The global credit crisis is having its effect on first time homebuyers as no deposit home loans could disappear next year.
The Commonwealth Bank has told Mortgage brokers that from December 1st lenders would have to pay a deposit of between 5 - 20 percent of the purchase price based on whether they have mortgage insurance.
Commonwealth Bank has also announced that they will lend up to 95 percent of the value of a property.
According to InfoChoice research figures 145 lending institutions offer 100 percent home loans subject to mortgage insurance.
Both the ANZ and Commonwealth banks have decided to restrict home loans to 90 percent of a homes value, while Westpac, St. George and NAB have all confirmed that they have no immediate plans to withdraw their 100 percent no-deposit home loans.
In light of the government's grant initiative for first homebuyers some banks believe it is still important to continue to provide a range of mortgage options.
Financial research house Cannex said that it was only a matter of time before the no-deposit home loans disappeared as lenders become more cautious of borrowers being exposed to negative equity lenders.
Financial analyst Frank Lopez said lenders were concerned property values were dropping and that there was increasing investor pressure for a greater asset base.
Morgan banking analyst Brian Johnson said that "The era of getting very easy credit to buy a house was over."