Have you found a property that happens to be near high tension power lines?
Whether it’s an existing property or you’re building a home, high voltage power lines can see your home loan declined unless you choose the right lender.
How much can you borrow?
- Power lines are more than 50 metres from the boundary: Borrow up to 95% of the property value with select lenders.
- Power lines are above the property: You can borrow up to 80% on a case by case.
- Power lines within 50 metres of the boundary: Borrow up to 80% on a case by case basis.
- In many cases, valuation risk ratings and the property valuer’s comments will affect the outcome.
- Borrow up to 105% of the property value with a guarantor home loan.
Some lenders are more conservative than others when it comes to high tension power line home loans.
You may be knocked back even if the property boundary is 150m away from power lines or a substation!
How do I qualify?
You’ll need to provide the following details when applying for your home loan:
- The property address or, better yet, a link to the listing from a real estate website like realestate.com.au or domain.com.au.
- Confirm whether the power lines run over the property.
- Confirm how far the house from the power lines in metres.
- Confirm how far the boundary of the property is from the power lines in metres.
In most cases, we will need to complete a valuation to confirm the property is acceptable.
In the meantime, we strongly recommend that you do not commit to buying a property with high tension power lines until we have completed our assessment.
What if I’m building a home?
In most cases, the building plans should detail whether power lines will run near your property.
Before paying your deposit, ensure that:
- Your builder is licenced and experienced.
- The building plans are council-approved and factor in legal requirements for clearance from high tension power lines.
When applying for a construction loan, it’s important to let your mortgage broker know that high voltage power lines will be located near the property.
This will help determine the lender they choose.
Why are banks so conservative?
Properties that are under or near high tension power lines are usually avoided by most homebuyers.
The same is true for properties that are near telephone poles and wind turbines.
The saleability or marketability of these properties presents a risk to the bank because they need to be able to sell the property quickly in the event that you default on your mortgage.
These properties aren’t covered under the bank’s Lenders Mortgage Insurance (LMI) so that’s why they’re wary about approving high tension power line home loans.
We can order a free upfront property valuation with a few of our lenders so you can be confident that your property will be accepted.
Are powerlines a health risk?
Power lines are known to buzz and affect mobile signals but technology is getting better so this is no longer as big of an issue.
Where the main concern lies is with potential health risks, whether the risks are perceived or accurate.
Many studies have been undertaken on the effect of power lines, substations, transformers and the emission of so-called extremely low frequency (ELF) and magnetic fields (EMF).
The Australian Radiation Protection and Nuclear Safety Agency (ARPNSA) concluded: “scientific evidence does not establish that exposure to ELF-EMF found around the home, the office or near power lines and other electrical sources is a hazard to human health.”
There are obviously other studies available online so we recommend that you undertake your own independent research to make an informed decision.
The good news for investors is that while valuations may be affected, properties near power poles don’t necessarily have higher vacancy rates.
Tenants generally don’t live near power lines for any longer than 12 months but they certainly aren’t shying away in droves.
In fact, a property near high tension power lines can be a great investment opportunity.
Are all power lines the same?
Power cables can come in the following classes:
- High voltage lines (69-115 kilovolts).
- Medium voltage lines (0.6-69 kilovolts).
- Low voltage (up to 600 volts).
What most lenders are concerned with are those in the 69-115KV range where the power lines are suspended high above the ground along transmission towers.
Discover if you qualify for a home loan
Call us on 1300 889 743 or complete our online enquiry form and we can let you know if we can get your approved for a home loan.
We’re experts in getting home loans approved for properties with high tension power lines over or near the property.