New Migrant Home Loans Australia: PR & Non-PR Guide

By Peter

Many new migrants settling in Australia face a critical question: "Can I get a home loan in Australia under my current visa status?"

The answer is yes. However, your loan options, borrowing capacity, and eligible government benefits depend heavily on your specific visa status and that of any co-applicants. Significant differences exist between permanent residents (PR) and temporary residents (TR) regarding lender policies, Foreign Investment Review Board (FIRB) requirements, and state-based tax surcharges.

Here is a breakdown of mortgage strategies and policy insights across three common visa scenarios nationwide.

How Does Getting a Home Loan Work if Both Applicants Have PR?

If all applicants hold Australian Permanent Residency (PR), most lenders treat you as a standard local borrower.

Loan Strategies and Requirements:

High LVR (Loan-to-Value Ratio): PR holders can typically borrow up to 95% of the property value (requiring only a 5% deposit), depending on income capacity and credit history.
Lender Selection: You can access virtually all mainstream banks and non-bank lenders, giving you full access to competitive fixed and variable interest rate products.
Loan Structure: Setting up an offset account is recommended to optimise tax efficiency and reduce interest costs.

Can You Get a Home Loan if One Applicant Is Non-PR?

This is a common scenario among new migrant households, such as one partner holding PR while the other holds a Temporary Graduate visa (subclass 485) or Temporary Skill Shortage visa (subclass 482).

Loan Strategies and Requirements:

FIRB Exemption: Across Australia, if you purchase a home jointly with your PR spouse, proper property title structuring often allows the non-PR applicant to qualify for a FIRB exemption, saving thousands in application fees and reducing processing delays.
Foreign Buyer Stamp Duty Surcharge: State regulations vary. In certain states, purchasing jointly with a PR spouse may exempt the transaction from foreign purchaser surcharges; in others, the non-PR partner may still incur surcharges proportional to their share.
Lender Variation: Banks assess this combination differently. Some mainstream lenders treat it as a standard domestic loan with LVRs up to 90% or 95%. Others classify non-PR applicants as higher risk, capping LVRs at 70% to 80%. Matching with lenders that have favourable policies for joint PR/TR applications is essential.

What Are the Lending Rules if Neither Applicant Has PR?

If both applicants hold temporary visas (e.g., work or student visas), lending criteria are stricter and upfront acquisition costs are higher.

Loan Strategies and Requirements:

FIRB Approval: You must obtain FIRB approval before signing a contract or include a standard "Subject to FIRB approval" clause. Temporary residents are generally limited to purchasing one established dwelling as their primary residence, or purchasing new dwellings.
Foreign Purchaser Surcharges: Most Australian states and territories apply a 7% to 8% foreign buyer stamp duty surcharge. This must be factored into your upfront purchasing budget.
Lower LVR Caps: Lenders accepting purely TR applicants typically require a 20% to 30% deposit (capping LVR at 70%–80%).
Lender Selection: Mainstream banks remain conservative with TR applications. Borrowers often need specialised second-tier lenders experienced with non-resident or foreign income.

What First Home Buyer Grants and Benefits Can New Migrants Claim?

Eligible new migrants purchasing their first home can leverage federal and state government schemes to lower their entry barrier.

Stamp Duty Concessions and Exemptions Every Australian state offers stamp duty relief for eligible first home buyers.

Eligibility: Properties must fall below specific price thresholds (e.g., full exemptions under $600,000 and concessions up to $800,000, varying by state).
Residency Requirements: Applicants generally must be Australian citizens or PRs. For joint PR and non-PR applications, some states allow concessions proportional to the PR applicant's share.

First Home Owner Grant (FHOG) State governments provide cash grants (typically $10,000 to $15,000) to encourage purchasing or building new homes. At least one applicant must be an Australian citizen or PR. This grant generally does not apply to established homes.

Australian Government 5% Deposit Scheme Administered by Housing Australia, this federal scheme allows eligible buyers to purchase a home with as little as a 5% deposit without paying Lender's Mortgage Insurance (LMI).

Policy Updates: Income caps and waiting list limits have been removed under recent policy updates.
Eligibility: Joint applicants are no longer restricted to married or de facto couples; friends and siblings can apply together. At least one applicant must be an Australian citizen or PR. Waiving LMI provides substantial upfront savings.

Client Case Study

We recently assisted a couple purchasing their first home. One partner held a PR visa, while the other held a subclass 482 work visa. The clients initially assumed they needed a 30% deposit or higher, along with FIRB approval and heavy foreign stamp duty surcharges.

After reviewing their financial position and relevant state regulations, we implemented the following strategy:

Navigating Regulatory Approvals: Guided the clients on appropriate ownership title structuring, enabling them to meet the requirements for a FIRB exemption.
Securing Standard LVR and Rates: Matched them with a mainstream lender with flexible PR/TR policies, securing approval at a standard 80% LVR with standard domestic interest rates.
Minimising Tax Liabilities: Maximised state first home buyer tax concessions, securing stamp duty relief and successfully avoiding foreign purchaser surcharges under local regulations.

This approach significantly reduced the clients' upfront capital requirements, allowing for a seamless settlement.

Navigating Your Home Loan Journey as a New Migrant

Securing a mortgage as a new migrant in Australia does not have to be overly complex, but it does require careful forward planning. Because bank policies, state taxes, and FIRB regulations change regularly, small differences in how you structure your loan application or property title can result in significant financial differences.

Before starting your property search, consider taking the following practical steps:

Verify Your Visa Conditions: Confirm your exact subclass, expiration dates, and work rights, as these directly dictate which lenders will accept your application.
Obtain Pre-Approval: Secure a formal pre-approval to confirm your real borrowing power and deposit requirements before signing any contracts.
Structure Contracts Correctly: If you are a temporary resident, ensure your purchase contracts include the appropriate FIRB conditions or subject-to-finance clauses to protect your deposit.

Working with a mortgage broker who understands the nuances of non-resident and new migrant lending will ensure you navigate lender policies efficiently, avoid costly mistakes, and maximize your eligible policy benefits.