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An expected interest rate cute in early 2025 could result in another property market boom, but the likes of Canberra, Sydney and Melbourne would experience relatively strong declines if they don’t materialise.

Whether or not Australian real estate markets soar or struggle is almost entirely down to whether or not interest rates are cut in 2025.

That’s the finding of SQM Research, which on Tuesday released its Christopher’s Housing Boom and Bust Report 2025 that concluded Perth was set for another bumper year regardless, while property prices in Sydney and Melbourne would likely retreat by up to 5 per cent.

The report factored in a series of potential economic eventualities, but used its base case scenario as one in which there would be a 25-50 basis point rate cut midway through next year and population growth of 500,000-plus.

In that circumstance, the report forecast property values would rise 1-4 per cent as long as there were no new inflationary outbreak events.

Sydney and Melbourne housing prices are predicted to continue to record moderate housing price falls of between 1 to 5 per cent, while Canberra was the market to avoid with expected price falls of 2 to 6 per cent.

Perth, Brisbane, Adelaide and, more surprisingly given its current stagnation, Darwin are expected to outperform the national housing market with Perth forecast to record the fastest dwelling price rises of between 14 to 19 per cent.

Brisbane is forecast to record strong dwelling price rises of between 9 to 14 per cent in what will be its 12th straight year of dwelling price increases.

In Melbourne, the bulk of the weakness over 2025 is likely to occur in the inner-city ring where SQM has been recording surges in distressed listings. However, given the underlying shortages in homes as has been recorded in the rental market, once interest rates are cut, SQM anticipates a quick rise in Melbourne buyer demand.

If interest rates were to remain at their current levels deep into 2025 it would be a very different scenario that played out across the country’s diverse property markets.

(Source: RateCity)

It has been a year since the RBA last changed the cash rate. The big four banks remain confident a rate cut will come early in the new year but the Reserve Bank of Australia (RBA) inflation forecasts ensure there is still plenty of cause to doubt that.

The RBA’s November monetary policy statement predicted headline inflation will gradually decline from 3.8 to 2.8 per cent in June 2025, easing towards the RBA’s target band of 2-3 per cent before lifting out of the range with 3.7 per cent in December 2025, dropping back to 2.6 per cent by the end of 2026.

Those estimates do little to instil confidence the cautious RBA Board will leap into rate cuts if it sees inflation at 3.7 per cent by the end of next year.

Nor does the October inflation data released Wednesday (27 November) shift the dial. The RBA’s preferred trimmed mean inflation measure rose slightly last month from 3.2 per cent to sit at 3.5 per cent.

Were the RBA to hold out on rate cuts in 2025, SQM’s research paints a markedly less buoyant picture of the national property market.

SQM’s second most likely scenario is where interest rates are not cut at all over 2025 but population growth remains strong. Sydney, Melbourne, Canberra and Hobart housing prices are expected to fall further in such an event, however, Perth is still expected to record a strong market given the strength and momentum that is currently in place.

Louis Christopher, Managing Director of SQM Research said for 2025 they were not anticipating much of a change in current population trends but were anticipating a cut in interest rates starting from mid-year that would continue the price rise momentum in Perth, Brisbane and Adelaide and keep the price falls in Sydney and Melbourne to single digits.

“To be sure, our two largest capital cities, along with Canberra and Hobart will start 2025 off in the red; indeed, we are currently recording dwelling price falls in each of these cities.

“Current interest rate settings are biting the community more in these cities which on our measurements, are in overvalued territory and/or are experiencing slower economic growth compared to the cities (and states) that have enjoyed good economic growth through a buoyant commodities market and/or have had generous contributions from GST receipts.

“However, once interest rate cuts do occur, we are expecting a speedy bounce in demand for Sydney and Melbourne in particular, which both are still experiencing underlying housing shortage relative to the strong population growth rates.

“This may well mean there is a good window for buyers at this time for our two largest capital cities.

“If rate cuts do not occur in 2025, it is unlikely a recovery will occur in Sydney and Melbourne at any time next year,” Mr Christopher said.

There’s a gaping chasm between the proportion of income that is deemed comfortably manageable and the amount the average Australian is actually spending.

Whether it’s a new or refinanced home loan, or the need to fund a major renovation project, well informed decision making can make or break the success of the property investment, writes Helen Avis, Director of Finance, Specialist Mortgage.

There’s a lot more to a home loan than just the interest rate.

The features of the loan can also have a big impact on your total mortgage costs and repayment flexibility, which is why it’s important to understand the potential benefits of a redraw facility and an offset account.

Redraw and offset have one thing in common – they reduce the amount of interest you get charged. If, for example, you have $500,000 outstanding on your loan and $40,000 in either redraw or offset, you’ll be charged interest on only $460,000 (i.e. $500,000 minus $40,000).

But there are subtle differences between the two features, according to Helen Avis, Director of Finance, Specialist Mortgage, who has just won her fourth successive WA/NT Broker of the Year Award at the Specialist Finance Group’s 2024 National Awards.

Redraw loan facility

Redraw is a facility that sits within your loan. The way you accumulate money in redraw is by making extra home loan repayments. The lender will allow you to borrow back (or redraw) these extra repayments, subject to certain conditions. But because this money belongs to the lender, it’s technically possible the lender might decide one day not to allow you to reclaim the money, or change the conditions of redraw.

Offset accounts

Offset is a separate transaction account that’s linked to (but separate from) your home loan account. The way you accumulate money in offset is through deposits – for example, salary payments. The money in your offset belongs to you, so the lender can’t prevent you accessing it.

Overall pros and cons

Pros: you can use redraw and offset to reduce your interest bill and pay off your home loan sooner.

Cons: your lender may charge you a higher ongoing fee or higher interest rate to access these loan features. Also, you may be charged a fee for each redraw transaction.

Financing renovations

Renovations are incredibly popular, with homeowners investing $2.84 billion on alterations and additions in the June 2024 quarter, according to the Australian Bureau of Statistics.

Typical costs range from about $2,000 to $5,000 for bedrooms, $15,000 to $30,000 for bathrooms and $25,000 to $50,000 for kitchens, according to JDL Constructions.

Helen Avis’ financing tips:

Here are three ways to finance your renovations:

• Take out a construction loan. With a construction loan, the funds will be distributed in stages throughout the project, rather than in an upfront lump sum, and you’ll be charged interest only on the funds you’ve already received. Your construction loan will be interest-only during the building phase and will then revert to a standard principal-and-interest home loan once the building has been completed.
• Take out a personal loan. Compared to a construction loan, the application process is likely to be faster and your chance of approval is likely to be greater, but your interest rate is likely to be higher as well.
• Pay cash. This is the simplest option. If you’re thinking about paying for the renovations with a credit card, be careful. While you will not have to go through an application process, the interest rate will be extremely high and could leave you susceptible to falling into a debt trap.

The hottest property markets in Australia are not spelt in capitals; it’s regional real estate that is outperforming the nation’s major cities, but where are the real hotspots?

From Geraldton to Townsville, regional property markets have outperformed the capital cities over the past three months.

The gains were driven by strong growth in the mining towns of Western Australia and Queensland, with quarterly price gains strongest in Mackay (8.3 per cent), followed by Geraldton, up 8.2 per cent, and Townsville, up 6.6 per cent.

Geraldton also recorded the strongest annual increase with dwelling values up 28.7 per cent over the year to October, adding more than $100,000 to the median value. Queensland’s Gladstone and Townsville also recorded significant annual growth of 27.2 per cent and 26.9 per cent respectively.

While sales activity was broadly losing momentum, Geraldton and Gladstone were again the standout performers, recording an increase in their annual sales volume of 44.2 per cent and 34.3 per cent, respectively.

Dwelling values in regional areas rose 1.1 per cent over the three months to October, exceeding the 0.8 per cent growth recorded in capital cities.

(Source: CoreLogic)

Kaytlin Ezzy, CoreLogic Australia economist and author of the CoreLogic Regional Market Update released Wednesday (27 November), said Queensland and Western Australia regions continued to dominate the top-performing- lists, taking out the top eight spots for quarterly value growth areas.

“Regions like Mackay, Geraldton, and Townsville are seeing exceptional growth, driven by affordability advantages compared to our major cities, as well as lifestyle appeal,” Ms Ezzy said.

“This will have contributed to the strong demand but even with the impressive growth, for those with the capacity to service a mortgage, they still remain attainable with medians less than $600,000.”

Conversely, across Australia’s largest 50 non-capital city Significant Urban Areas (SUAs), seven out of eight Victorian SUAs and 10 out of 21 NSW SUAs saw values fall over the three months to October.

The holiday town of Batemans Bay, on NSW’s south coast, recorded the largest decline, down 2.7 per cent over the quarter, followed by Victoria’s coastal city of Warrnambool, down 2.6 per cent.

Rents are also still inching upwards in the regions (0.5 per cent over the quarter), whereas they were unchanged over three months in the combined capital cities. Albany led the way for quarterly rental growth (3.0%).

The Kalgoorlie–Boulder region continued to record the highest gross rental yields among the largest regional Significant Urban Areas (SUAs), at 8.8 per cent, despite yields falling 70 basis points from a recent peak in March (9.5 per cent). Similarly, the Bowral–Mittagong region in NSW continued to record the lowest gross rental yields at 3.2 per cent, with yields expanding 20 basis points over the same period.

Over the year, 10 markets in NSW and Victoria fell in value, with Ballarat recording the largest fall at of 6.3 per cent, followed by the St Georges Basin–Sanctuary Point region in NSW, and the Warragul–Drouin region in Victoria, both down 3.9 per cent over the year.

Ms Ezzy said the downturn in regional coastal and lifestyle areas of Victoria and NSW partially reflects their strong performance during Covid, when demand surged for affordable lifestyle markets and more space.

“While these markets thrived during the early stages of Covid, reduced affordability and a range of headwinds have since softened conditions,” she said.

“There’s certainly been a slowdown in demand for these areas and more stock on the market and that’s in addition to higher interest rates, cost of living pressures, and limited borrowing capacity.”

API Magazine’s recently released quarterly property sentiment report found there was a renewed expectation that property prices in the regions would continue to rise over the next 12 months.

(Source: API Magazine Property Sentiment Report Q3 2024)

After falling 13 percentage points the previous quarter, most of that drop was recovered, with 64 per cent respondents now expecting prices to rise. This is the second highest ratio in the nine quarters this metric has been measured.

Issues with regional relocations

While the figures point to the regions broadly enjoying economic strength, the volume of people moving from the cities to regions is creating housing pressures that are escalating.

Real Estate Institute of Australia (REIA) President, Ms Leanne Pilkington, said the latest data revealed that the number of city-dwellers considering a move to regional areas has doubled over the past 18 months.

Citing the Year 2 Progress Report by the Regional Australia Institute (RAI), she said there was an urgent need to address key pressure points, particularly housing availability and affordability, to support regional communities.

“The persistently low regional rental vacancy rates, which remain well below the three per cent threshold for balanced rental markets, highlight the ongoing housing supply challenges in these areas.

“Regional areas have also experienced a sharper increase in house prices compared to capital cities, with prices rising by 54.2 per cent from March 2020 to December 2023, compared to 29.3 per cent in urban centres,” she added.

REIA partnered with the RAI and Master Builders Association earlier this year to host the National Regional Housing Summit, where nearly 300 delegates gathered in Canberra and online to address these critical issues.

Ms Pilkington said the recent National Regional Housing Summit in Canberra reinforced that regional Australia requires bespoke solutions that cater to the unique market dynamics of each community.

“Key messages from the summit included the need for long-term, systemic thinking, increased infrastructure investment, and enhanced collaboration across all levels of government and stakeholders.

“REIA’s policy positions include governments creating conditions for more dynamic regional rental markets, including significant investment in social and affordable housing, increasing housing supply and diversity and ensuring a steady pipeline of development-ready land is vital to meet demand.”

Ms Pilkington said the Australian Government’s recent housing programs, including the Housing Australia Future Fund, are positive steps but currently lack a specific allocation for regional areas.

National property prices are now almost flatlining, with the pace of growth slowing in the strongest markets and going backwards in Sydney and Melbourne.

The property boom that has been underway in Australia for two years is all but over.

In the weakest result since January 2023, dwelling values on a national basis eked out a 0.1 per cent gain in November.

The latest CoreLogic Home Value Index (HVI) reaffirmed the downward trend in property prices around the country.

The three cities that have been the powerhouse of capital growth – Perth, Adelaide and Brisbane – are still generating reasonably strong price growth but momentum is subsiding.

The country’s two biggest markets, Sydney and Melbourne, are now settling firmly into a slow price decline, with Hobart also sliding in the past month.

(Source: CoreLogic)

Perth’s pace of capital gain continues to lead the nation, with values up 1.1 per cent over the month and 3.0 per cent higher over the rolling quarter, however, this was the softest rise over a rolling three-month period since April 2023 and is less than half the rate of growth recorded through the June quarter (6.7 per cent).

Similarly, Brisbane’s quarterly rate of growth has eased back to 1.8 per cent, the slowest pace of gains since March 2023, while Adelaide’s 2.8 per cent rise in values over the past three months was the smallest outcome since June 2023.

Buyers who were holding out for an interest rate cut have seemingly put the wallets and purses aside as the prospects of an imminent cut to the official cash rate recede.

That was underlined on Friday (29 November) when ANZ become the third of the four big banks to push their expectations of a rate cut back from February to May 2025.

A rate cut in early 2025 would likely reignite property prices and drive affordability further out of reach of many but the current downward pressure on prices now appears to have little opposition even in the face of limited housing supply.

The money that had been pouring into the property market is now being squirreled away.

Household deposits hit another record high in October, according to RateCity.com.au data released Friday, with Australians saving an extra 19.5 billion in that month alone.

The correlation between interest rates and savings, and by extension its effect on property price pressure, has been made clear over the past couple of years. Household bank deposits have now risen by $272.6 billion since the start of the rate hikes (April 2022 to October 2024 inclusive).

Listings on the rise

Buyers are now enjoying more choice, with listings on the rise around the country.

Capital city unit and house listings are up 16 per cent since the end of winter, with Perth (33 per cent) and Adelaide (25 per cent) recording the largest lift in advertised stock levels through the spring season, albeit from an extremely low base, with total listings remaining well below average in these cities.

Sydney and Melbourne listings are now tracking 10.4 per cent and 9.1 per cent above their previous respective five-year averages, to be at their highest level for this time of the year since 2018.

Median selling times are also trending higher for private treaty sales.

Regional property has reinforced its outperformance of the capitals in the latest HVI.

Outside of the capitals, regional housing trends have been a little stronger, with the combined regional index rising 1.1 per cent over the past three months compared with a 0.3 per cent lift across the combined capitals.

As with the capital city trends, there is significant diversity, with regional Victoria weighing on the headline numbers, down 0.9 per cent over the rolling quarter, while every other ‘rest of state’ region continued to record a mild rise, led by regional WA up 3.3 per cent.

Real estate prices still have some factors preventing a more rapid deceleration.

Tim Lawless, CoreLogic’s Research Director, said an undersupply of newly built housing is likely to provide some support for housing values.

“Although population growth is expected to ease further in 2025, a cumulative undersupply of housing has accrued across Australia following the record levels of population growth since international borders re-opened.”

The unemployment rate has levelled out in the early 4 per cent range over the past seven months, with participation in the workforce holding around record highs and under-employment trending lower.

“While strong labour markets are a welcome outcome for most Australians, the risk in a tight jobs market could keep additional upward pressure on wages that could in turn fuel consumer spending, supporting higher housing prices.

International buyers have more to spend

Australian buyers are now also looking for bargains.

The fastest growing property markets have predominantly been driven by hot demand in the outer suburbs and findings released Friday support the perception this is set to continue.

The most common maximum price for Australian searchers when looking to buy on realestate.com.au is $600,000.

International buyers looking to Australia seemingly have their eyes on a pricier prize, in part due to Australia’s low dollar valuation.

The most searched top price band for overseas searchers is $1 million, according to PropTrack, which is reflective of the suburbs that get the most search activity from overseas.

Some of the cities frequently searched have more moderate prices, such as Brisbane, Perth, and Adelaide; however, suburbs such as Brighton, South Yarra, and Camberwell, all in Melbourne, which are popular with overseas buyers, are all in the pricier range.

This trend is similar for overseas property seekers looking to rent. Aside from the major CBDs, renters are interested in South Yarra, Bondi, and Manly, to name a few.

Of the countries with the largest search numbers, searchers from India have a smaller budget, mostly searching for properties below $600,000.

This is reflective of many of the suburbs they search for, preferring new development suburbs such as Tarneit and Point Cook, which have reasonably priced new homes for sale.

Building Or Undertaking Major Renovations On Your Home?

Or are you an Aussie expat looking to build or renovate your existing property in Australia? A construction loan might be just what you need. Unlike standard loans, construction loans allow you to pay for each stage of the build without needing all the funds upfront.

How Construction Loans Work In Australia

Construction loans, also known as building loans, are designed for individuals who are either building a new home or making significant structural changes, like adding a room or changing the roof, to an existing home. These loans offer flexibility by allowing you to draw down progress payments throughout the build or renovation.

A Mortgage With Draw Down Progress Payments

A significant feature of construction loans is the ability to draw down your loan in instalments during the construction process. This means you’ll receive the loan amount in stages rather than as a lump sum. Typically, these stages include the deposit, foundation works, framework, lock-up, fixing (plumbing and electrical), and completion.

This staged payment approach means you only draw down the amount needed to pay your builder and contractors as they complete each stage. Consequently, you are only charged interest on the amount drawn down, not the total loan amount. The principal loan amount does not need to be repaid until after construction is complete, which can help manage cash flow throughout the project.

Fixed Price Contract Australian Home Builds

Construction loans are generally based on a fixed price contract, whether you’re building on new land or renovating an existing property. This contract means there’s limited room for change once the building or renovations are underway.

Typically, the loan is interest-only during the construction period and transitions to principal and interest payments once the project is completed. You may be able to negotiate to extend the interest-only term, so it’s worth discussing this with your lender if it appeals to you.

If changes are needed during the build, discuss these with your lender as they can affect forecast costs. It’s wise to account for potential changes when applying for the loan, as variations are common in construction and renovation projects.

How to Apply For An Australian Property Construction Loan

To apply for a construction loan, you’ll need to provide your lender with council-approved building plans and a fixed price building contract from a registered builder. Usually, a deposit of 10%-20% of the total cost is required, and if your deposit is less than 20%, you might need to pay Lenders Mortgage Insurance.

Having a licensed builder increases your chances of loan approval, though you can apply as an owner-builder, which involves more paperwork and a longer process. A valuer may visit during construction to ensure the project is on track. Based on their report, the lender will continue payments or address any issues.

Be aware of key dates, such as when the build must be completed (Eg: within 24 months from the first drawdown). Keep your lender informed of any delays to discuss timeline adjustments.

Once construction or renovations are complete, you’ll need to provide final paperwork, such as the builder’s final invoice, building insurance policy, and certificate of occupancy.

Navigating the building and renovating process can be stressful, but we at Specialist Mortgage are here to help. Contact us today to learn how we can assist you with securing a construction loan, or any Australian home, and guide you through the process to make your dream home a reality.

If you are looking to buy property next year – congratulations!

You have an exciting but somewhat challenging time ahead of you. If you are feeling a little daunted by the prospect, the good news is there is help at hand.

Buying a home is certainly one of the biggest financial commitments you’ll make in your life, so you need to go into a property purchase feeling confident and informed. While we will of course be there for you every step of the way, we’ve also compiled some of the best sources of information and support for you to access.

Saving for a deposit

Although residential home values are falling across most of the country, it is still quite a challenge to come up with a deposit. While the rule of thumb is a 20 per cent deposit, some savers buy with a 10 per cent or 5 per cent deposit and either pay lenders’ mortgage insurance (LMI) or use a first home buyer scheme that allows low-deposit purchases but waives LMI.

In any case, that all-important deposit can be a significant sum to save but there are some valuable tools that can assist you. There are many online calculators such as this one that can help you determine how much you’ll need, and what you can afford.

To get a hand with the savings side of things there are a heap of apps to help you get a handle on and manage your financial situation. Frollo is a free budgeting app that you can use to sync all of your financial accounts, create a financial goal – like saving for a deposit – and track your progress.ⁱ

We are also here to let you know how much you can borrow and what your budget and deposit will need to be.

Financing your loan

The finance side of things can be tricky to navigate alone, and we can assist you to find the best deal and navigate the process and necessary paperwork. There are also several government grants and schemes available for first-home buyers both at the national and state level and we can assess what schemes you may be eligible for.

Searching for the property

To save you time and effort in your search for the perfect property, online real estate websites often have profiles of different suburbs and towns. Real estate institutes offer property data that lets you compare sales prices across locations.

It allows you to get to know the real estate agents in the area where you want to buy, let them know what you are looking for and have your name added to their mailing lists.

Inspecting potential properties

The purchase of property is still summarised by the Latin phrase ‘Caveat Emptor,’ meaning ‘let the buyer beware’. This puts the onus on the buyer to ensure they are satisfied with the condition of the property before signing the contract.

A house inspection can be an easy way to discover any potentially expensive problems.

Buying

Ok, so you’ve found that dream home and your offer has been accepted by the vendor. The next step is signing a contract and arranging the transfer of ownership. Lawyers (for example, a solicitor or a conveyancer) are generally used to make sure all legal obligations have been met by the buyer and the seller.

We are also here to help you manage your finance and settlement deadlines and then to guide you through the life of the loan if you need a hand with any aspect of your borrowings.

Wishing you the best in achieving your property dreams in 2025. Please get in touch at any stage if we can be of assistance.

i https://frollo.com.au/app/

The new year is a time when most people sit back and set some goals for the year ahead.

But why not think about your goals for next year now? If you are thinking of buying a property, get a jump-start on the new year and be ready to buy by starting the pre-approval process and doing your research now.

Prepare a budget

If you haven’t already, prepare a budget so you have a clearer understanding of your purchasing power. Calculate your monthly income, subtracting your monthly expenses and any debts – this will show you the amount that’s left over, so you have a clearer idea on what you can afford for your monthly mortgage payments.

We have a great budget tracking calculator you can use here

Keeping track of what’s going into your bank account (income, payments) and what’s going out (expenses) can also identify what you can cut back on – such as forgoing the daily café coffee or cancelling some subscriptions or memberships.

While setting a budget can be a simple process, it can also be a good opportunity to get professional advice during this stage. A broker can shine a light on things you may not have thought of, as well as provide a realistic perspective on what you can afford.

Begin the pre-approval process for an Aussie home loan

It is also worthwhile starting the pre-approval process, if you’re looking to buy early in the new year. Having a pre-approval shows the seller that you are serious and can give you a leg-up on the competition. Also known as conditional approval, pre-approval gives you an indication of how much you will be able to borrow, which can help you when it comes time to bid.

You will want to get your paperwork ready including your ID, payslips, and bank statements in order to submit an application form.

It’s generally free to get pre-approval. But keep in mind that pre-approvals expire – they are generally valid for three to six months – so this step is for when you’re closer to being able to buy.

Do your research on Australian property

Now is also a great time to do your research. If you know which area you’re looking to buy in, research how the area is performing (realestate.com.au/sold/ is a great resource). You can also refer to real estate institute websites as they list data such as the top growth suburbs by median house and unit prices. As well as researching online, get out and attend some auctions, especially in the locations you’re interested in.

It’s also worth narrowing down your needs and wants for a property. Most of us need to compromise somewhat given the cost of housing, so be realistic, but also be clear on what is a must – do you need a certain number of rooms, a backyard, parking spaces, etc? Are you able to buy a fixer upper and renovate or do you need move-in-ready?

Look into what government initiatives are available to you as a buyer, such as the Regional First Home Buyers Support Scheme or the First Home Buyer Scheme. State Government websites contain helpful information on the current schemes and grants.

Planning to sell your Australian property

If you have an existing property, prepare a plan for selling. You will need to give yourself time to spruce up the property if needed, style it, have photos taken and put it on the market. Again, this is a good time to research the market as well to see what similar properties in your location are selling for.

If you didn’t buy the home of your dreams this year, try not to get discouraged, but also be realistic. As there have been significant increases in the cash rate which have flowed onto interest rates, it might be a time to re-evaluate where and what type of property you can now reasonably afford. Whatever your financial situation, we can help you start the process to prepare to buy in the future.

Here’s What Expats Should Know!

As mortgage brokers, we’ve seen firsthand the unique challenges and opportunities faced by Australian expats interested in property investment back home. If you’re considering purchasing Australian property in 2025, here are some key insights and trends that could shape your journey.

1. The State of the Aussie Property Market

Australian property prices have surged in recent years, and although growth has slowed, the market remains strong in capital cities and regional hotspots. Interest rates have steadied after recent hikes, but high rates could remain a barrier for some. Expats should expect a more balanced market, where buyer demand meets increased property listings, creating opportunities for savvy investors.

2. Rising Demand from Expats

Many Australian expats are looking to secure a future family home or investment property, motivated by the weaker Australian dollar, lifestyle benefits, and potential tax advantages. 2025 might bring added competition, especially in high-demand suburbs with good rental yields.

3. Currency Exchange Rates

With the Australian dollar’s volatility, exchange rates can significantly impact your purchase cost. Some expats lock in exchange rates ahead of time to mitigate risk. A financial advisor can help you navigate currency fluctuations.

4. Trends to Watch

In 2025, sustainability features will continue to attract buyers, especially younger Australians. Properties with energy-efficient upgrades may offer long-term savings and resale value. Additionally, regional areas are gaining traction as remote work becomes mainstream.

5. Tips for a Smooth Process

– Get Pre-Approval: Securing a mortgage as an expat can be a little more complicated, so work with an experienced broker who understands expatriate lending policies.

– Consider Local Partners: Partner with a buyer’s agent for market insights and representation, particularly if you’re buying from overseas.

– Tax Implications: Consult a tax advisor, as Australian rental income and property sales may have tax implications depending on your residency status.

2025 promises to be a year of opportunity for expats interested in Australian property. By staying informed and working with the right professionals, you can make a sound investment that aligns with your goals.

Securing a home loan or Australian mortgage can be challenging for self-employed individuals, especially when they are also expatriates or foreign buyers.

Traditional lenders often require extensive documentation and may have stricter criteria for non-traditional borrowers.  With careful planning and preparation, self-employed individuals can increase their chances of obtaining a home loan for their Australian property; let’s explore some of the options.

Step 1: Prepare Accurate Financial Records

As a self-employed individual, maintaining accurate and up-to-date financial records is essential. These records should include income statements, tax returns, profit and loss statements, and bank statements. It’s important to have at least two years of financial history to demonstrate a stable income stream and the ability to repay the Aussie home loan.

Step 2: Engage the Services of an Accountant or Tax Professional

Working with an accountant or tax professional experienced in handling self-employed individuals can be invaluable. They can assist in organising financial records, ensuring compliance with tax obligations, and providing guidance on structuring income to meet loan eligibility criteria. Their expertise can enhance the credibility of your financial documents. As part of the SMATS Group of companies we can provide suitable contacts for your Australian tax and financial planning needs.

Step 3: Demonstrate Stability in Income

Lenders typically look for consistent income to assess the repayment capacity of borrowers. If you’re self-employed, demonstrating stability in income is crucial. Prepare a detailed business plan, highlighting long-term sustainability, client contracts, or agreements that demonstrate a stable income stream. This will provide reassurance to lenders about your ability to repay the loan.

Step 4: Save a Solid Deposit

Having a substantial deposit is advantageous when applying for an Australian Home loan, especially for expatriates and foreign buyers. Lenders may require a higher deposit to mitigate potential risks. Aim to save a significant portion of the property’s value to meet the deposit requirements. A larger deposit also reduces the loan-to-value ratio (LVR), increasing your chances of loan approval.

Step 5: Seek Specialist Lenders

Specialist lenders cater specifically to self-employed individuals, expatriates, and foreign buyers who may not meet the criteria of traditional lenders. These lenders have expertise in assessing non-traditional borrowers and understand the unique challenges they face. Engaging the services of an Australian mortgage broker can help connect you with specialist lenders who can provide tailored loan solutions. Specialist Mortgage have been servicing the expat community for over 30 years, if you want the expertise of an expat mortgage broker contact us today for an obligation free chat.

Step 6: Maintain Good Credit History

Regardless of being self-employed, expatriate, or foreign buyer, maintaining a good credit history is vital for loan approval. Regularly review your credit report to ensure accuracy and address any errors or discrepancies promptly. Make timely payments on existing debts and avoid taking on excessive new credit to demonstrate responsible financial behaviour to lenders.

Step 7: Provide Sufficient Supporting Documentation

Be prepared to provide additional supporting documentation as an Aussie expatriate or foreign buyer. This may include proof of income, employment contracts, visa documentation, and evidence of funds transfer for currency conversion. Thoroughly organising and presenting these documents will help strengthen your Australian mortgage loan application and demonstrate your credibility as a borrower.

Expatriates and foreign buyers face additional challenges when seeking a loan in Australia. It’s essential to plan ahead and be aware of the specific requirements. Consider factors such as visa status, foreign income sources, and currency exchange rates. Lenders may have specific criteria for expatriates and foreign buyers, and understanding these requirements will help you navigate the loan application process more effectively.

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© SMATS Services (Australia) Pty Ltd ABN 37 141 112 807 T/A Specialist Mortgage. Australian Credit licence 385201. The information provided on this site is on the understanding that it is for illustrative and discussion purposes only. Whilst all care and attention is taken in its preparation any party seeking to rely on its content or otherwise should make their own enquiries and research to ensure its relevance to your specific personal and business requirements and circumstances. Terms, conditions, fees and charges may apply. Normal lending criteria apply. Rates subject to change. Approved applicants only. Privacy Policy & Terms of Use | Credit Guide

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