ANZ's luxury residential hit-list has been divided into trophy postcodes worth $5 million, or more, and $4 million, or more, in Sydney and Melbourn, the nation's engine houses for property rises.

Ten elite Sydney postcodes are listed for review in the $5 million-plus category, including suburbs such as Bellevue Hill, Double Bay, Rose Bay and Northbridge. The entire list is in the

accompanying table. Only two Melbourne postcodes are in the top postcode category, which includes East Melbourne and Toorak.

Several suburbs where rocketing values mean properties now sell for more than $4 million are included in a separate list. They include inner suburban Melbourne and Sydney suburbs, such as Kew, Hawthorn, Manly and Willoughby.

Major banks turning up the heat on property buyers.

The new arrangements mean the bank's Property Risk team will review lending criteria, valuations and reassess risk decisions made to lower levels. It has the authority to amend, or reject, the approval. ANZ was not available for comment.

Major lenders are discreetly moving away from building market share in the mass market to higher end, bigger margin property funding, according to analysis by investment bank JPMorgan.

National Australia Bank's changes, which apply from this Saturday, will bring borrowers' switching their loans from another lender to NAB into line with existing customers.


At present, borrowers with other lenders shifting to NAB would have a hypothetical 30 per cent added to the loan to assess whether the borrower lender could service the loan.

Under the new arrangements, their ability to service their loan will be assessed on a hypothetical rate of 7.4 per cent, or 2.25 per cent plus the current borrower rate.

In addition, the bank will require details on the type of loan, current balance, current interest rate and when the loan will expire. It will only apply to new loans.

"This change ensures that we continue to lend responsibly, and make the most accurate and precise assessment of a customer's ability to repay their loan both today and in the future," a NAB spokesman said.

"Customers will now all be assessed by the same calculation for both new and existing debt," she said.

Ten banks, including Firstmac and loan.com.au, are raising their fixed term rates raising their fixed term rates in response to higher funding costs as global markets' expectation of higher rates is aggravated by expectations of higher inflation if President-elect Donald Trump implements his election promises.

"Large loans are potentially more risky, as top end property is likely to fall in value first in a downturn, together with inner city apartments," according to Martin North, principal of Digital Finance Analytics, a consultancy for banks and financial service companies.


"But there is still a need to lend, as it's the only growth engine in town; they need to drive on the accelerator and brake at the same time! Tricky!" said Mr North.

About 42 per cent of ANZ's loan book is home mortgages, compared with 52 per cent for NAB and 60 per cent for Commonwealth Bank of Australia, according to analysis of bank lending.

Other lenders are targeting other sectors of the market, such as foreign, or older borrowers.

For example, Macquarie Bank is also introducing tougher lending conditions for some borrowers by tightening rules on verification of rental and pay-as-you-go income, and imposing $2million caps on inner-metropolitan properties with a loan-to-valuation ratio of 80 per cent.

It is also demanding independent legal and financial advice for all borrowers aged over 70.