Home loans for Australians abroad: can you borrow?

By Rob McFadden, Founder and CEO at Hypothèque · Updated 2026-11-05 · 6 min read

Short answer: yes. Plenty of Australians living overseas get Australian home loans, but fewer lenders play, the paperwork is heavier and the rules are tighter than if you lived in Brisbane.

The short version

As an Australian citizen buying in your own name, you generally aren't treated as a foreign person for residential property, so the foreign buyer approval process and the 2025–2029 ban on foreigners buying established homes don't apply to you [1].
Not every lender takes expat applications. Those that do usually want a bigger deposit and discount your foreign income.
Banks must still test that you could repay at least 3 percentage points above your loan rate, and APRA caps how much high debt-to-income lending they can do [2].
Government help like the 5% Deposit Scheme requires you to move in within six months of settlement, which rules it out for most people staying abroad [3].
Get your documents, tax residency status and Australian bank account sorted before you start looking.

Who counts as "foreign" when you buy property?

This is the first thing most expats worry about, so let's clear it up.

The ATO, which administers foreign investment rules for residential property, says an individual is a foreign person if they are not an Australian citizen, a permanent resident or a New Zealand citizen on a special category visa [1]. Citizenship is the test for you as an individual buyer, not where you happen to live. From 1 April 2025 to 30 June 2029, foreign persons are banned from buying established dwellings, with limited exceptions [1]. As a citizen buying in your own name, that ban isn't aimed at you.

Two traps to watch:

Companies and trusts. The rules for entities look at people "not ordinarily resident in Australia". If you plan to buy through a company or trust while living overseas, get legal advice first, because the entity itself may end up classed as foreign [1].
Your partner. If you buy jointly with a partner who isn't an Australian citizen or permanent resident, state surcharges and foreign investment rules can kick in for their share. In NSW, for example, Revenue NSW treats people as foreign for surcharge purchaser duty unless they fall into an exception such as being an Australian citizen [4]. Each state has its own rules, so check where you're buying.

What lenders actually look at

Your passport gets you in the door. Your file has to do the rest. Here's what a lender weighs up when you apply from overseas.

What they check	Why it matters for expats	What helps
Citizenship and residency	Some lenders require Australian citizenship or an Australian address [5]	Passport copy, overseas visa or work permit
Income currency	Only some currencies are accepted; others are declined or assessed case by case [5][6]	A salary in a major currency such as USD, GBP, EUR or SGD
Income type	Many lenders are wary of self-employed income earned abroad [6]	Salaried role, employment letter, recent payslips
Deposit or equity	Expat maximum loan-to-value ratios are often lower than for residents [6]	A larger deposit, or equity in Australian property you already own
Living costs and debts	Your overseas rent, school fees and car loans all count	Clean statements showing regular saving
Repayment buffer	APRA expects banks to test you at least 3 percentage points above the loan rate [2]	Lower existing debt, realistic borrowing target
Purpose	Owner-occupied versus investment changes the policy and the rate	Be clear whether you'll ever live in it

Why it feels harder than at home

Lenders can't easily verify a Dubai payslip or a Singapore tax notice against Australian databases. They also take on currency risk: if the Australian dollar strengthens, your foreign salary buys fewer dollars to make repayments. That's why many lenders only count part of your overseas income and use their own exchange rates, which are often less generous than market rates [5].

The big rules every lender follows

The 3 percentage point buffer

The Australian Prudential Regulation Authority (APRA) expects banks to assess whether you can afford your loan at an interest rate at least 3 percentage points higher than the one you're actually offered. In its May 2026 update APRA kept that buffer at 3 percentage points [2]. If the loan rate is 6%, you're tested as though you're paying 9% or more.

The debt-to-income cap

APRA also limits banks so that no more than 20% of their new owner-occupier and investment lending goes to borrowers with a debt-to-income ratio of six times or more [2]. It's a cap on the bank's whole book, not a hard rule for each person, but if you're borrowing big relative to your income, you may find fewer lenders keen.

Tax: lenders may use Australian rates

When you're a foreign resident for tax purposes, Australian-source income such as rent is taxed from the first dollar at 30% up to A$135,000 in 2025–26, with no tax-free threshold [7]. Some lenders also assess your overseas income using Australian tax rates rather than the rates of the country you live in [5]. If you live somewhere with low or no income tax, that can shrink the income a lender thinks you have.

Can you use first home buyer schemes from overseas?

Mostly no, unless you're coming home soon. From 1 October 2025 the Home Guarantee Scheme became the Australian Government 5% Deposit Scheme, with income caps removed and higher price caps [3]. It's only for Australian citizens and permanent residents, and you must move into the property within six months of settlement and keep living there while the government guarantee is active [3].

If you're relocating home within that window, it may be worth a conversation with a participating lender. If you're staying in London or Tokyo for a few more years, plan without it. State first home buyer grants and duty concessions usually carry their own residence requirements too, so check the state revenue office before counting on them.

How to get ready: a practical order of play

Work out your tax residency. Your status affects how rent is taxed and how lenders treat you. Our guide on tax residency after moving covers the basics.
Keep an Australian bank account active. Some lenders want funds held in an Australian account [5], and you'll need one for repayments.
Gather six months of evidence. Expect to provide bank statements, recent payslips, an employment letter, passport and visa copies [6].
List every debt and cost. Credit cards in both countries, car leases, school fees, overseas rent. Lenders will find them anyway.
Decide the purpose. Home to move back into, or investment? It changes the loan type, the rate and the tax picture.
Talk to someone who knows expat policy. Policies vary widely between lenders, and a decline leaves a mark on your credit file. Mortgage brokers must act in your best interests when recommending a loan [8].
Get pre-approval before you go shopping. It typically lasts three to six months and shows what you can borrow; it isn't a final loan commitment [9].

Common mistakes Aussies abroad make

Applying to your old bank first and only. Being a customer for 20 years doesn't mean your bank's expat policy suits you.
Assuming the whole salary counts. Allowances, bonuses and housing benefits may be treated differently or ignored.
Forgetting the partner question. A non-citizen spouse can change duty, approvals and which lenders will consider you.
Leaving no buffer. Exchange rates move. Build in room for a stronger Aussie dollar and higher rates.
Signing before finance is unconditional. Auctions have no cooling-off period [9], and pre-approval is not a guarantee.

Home loans for Australians abroad: yes, you can still borrow back home