Expats living in Saudi Arabia can enjoy the same home loan options as Australians back home.
What opportunities are there for Aussie expats?
Expat Mortgages for Australians in Saudi Arabia
Here is everything you need to know about expats in Saudi Arabia finding Australian home loans.
Variable, Fixed, or Interest-Only
Australian expats living in Saudi Arabia are eligible for variable-rate, fixed-rate, or interest-only home loans.
Fixed-rate home loans allow you to budget your repayments while variable-rate loans might result in lower interest payments. Interest-only home loans enable Aussie expats to lower their monthly repayments in the early years.
Loan Size and Term
All Australians, whether you’re an expat, citizen, or permanent visa holder, should be able to apply for a LVR of up to 95%, depending on the lender and your borrowing power. Some professions or guarantor loans can get you up to 105% of the property value.
Expats in Saudi Arabia can also apply for a maximum home loan of 30 years.
Home Loan Package: Offsets and Redraw
Offset accounts and redraw facilities are available for expats and Saudi Arabians. You might need a stronger borrowing capacity to apply for these additional features.
How Do Lenders View Saudi Riyal?
Saudi Riyal is a tier 2 currency. This means that Australian lenders might only consider between 60 - 80% of your net earnings in Saudi Arabia. You can improve your borrowing power by ensuring you have a good credit score and providing sufficient financial documents to prove your income.
Pros and Cons
Take a look at the pros and cons of home loans for expats in Saudi Arabia.
Saudi Arabia doesn’t impose income tax on individuals, so you have a better chance of saving up a significant deposit to improve your borrowing power.
Australian lenders might impose Australian tax rates on your Saudi income. However, a few specialist lenders might use Saudi tax rates, 0%.
Saudi Arabians can borrow up to 60% or 70% of the property price, if they meet other lending criteria.
Saudi Arabia and Australia do not have a double tax agreement. Therefore, if you become an Australian tax resident while earning in Saudi, you may have to pay tax on your foreign income.
Australian expats in Saudi Arabia have the same interest rates as those in Oz.
Self-employed Aussie expats in Saudi Arabia may struggle to supply sufficient evidence of their income without regular tax returns.
Self-employed Aussie expats in Saudi Arabia can apply for a loan of up to 80% of the purchase price, depending on their documentation.
Here are the main mortgage features expats in Saudi Arabia can expect:
Expats in Saudi Arabia typically need a deposit of around 20%. However, Australians can borrow up to 95% of the property price with some lenders if they’re willing to pay Lenders Mortgage Insurance. Saudi Arabians might need a deposit of around 30%.
If your Australian lender uses Saudi tax rates, you could greatly improve your borrowing power. However, if they apply Australian tax rates, the amount you can borrow may take a hit.
Australian expats and Saudi Arabians can choose a repayment plan to suit their foreign lifestyle. You can opt for weekly, fortnightly, or monthly repayments with most lenders.
Interest rates are the same for Australian expats in Saudi Arabia as in Australia. However, Saudi Arabians might face higher interest rates if applying for an Australian mortgage. A specialist Australian expat mortgage broker like Odin Mortgage can help you find lenders with the most competitive rates.
Applying for Australian Expat Mortgages in Saudi Arabia
When applying for an Australian mortgage as a Saudi Arabian or expat in Saudi Arabia, you’ll need to meet the lender’s eligibility criteria.
Make sure you apply with a lender who specialises in Saudi Arabian home loans.
- A good credit score or history of making repayments on time.
- Australian citizenship (if you’re an expat).
- 20 – 30% deposit if you’re a Saudi national.
- Over 18 years of age.
- Two forms of income verification, such as recent payslips or an employment letter.
- Form of identification, such as a passport, driver’s licence, or birth certificate.
- Details of your expenses, such as other credit liabilities and living costs.
Double Taxation Agreement
Saudi Arabia does not have a Double Tax Agreement with Australia. Most expats can enjoy a tax-free life. However, if you’re buying property in Australia, you may have to begin paying Australian taxes. Moreover, if you become an Australian tax resident, you’ll have to pay tax on your Saudi income.
Expats and permanent visa holders do not need to apply for FIRB approval, even if you are married to a Saudi. However, Saudis purchasing property individually will face restrictions and need FIRB approval.
Stamp Duty Surcharge
Australian expats only have to pay the normal stamp duty rate between 4 – 5%. However, Aussies purchasing property with a Saudi spouse might have to pay the foreign surcharge of 7 – 8%.
We also provide expat mortgage services in the following countries
Frequently Asked Questions
Australian citizens and permanent visa holders can apply for Aussie home loans from overseas. Expats in Saudi Arabia can expect up to 90 – 95% LVR, competitive interest rates and a range of additional loan features.
Australian expats in Saudi Arabia can apply for up to 90 – 95% LVR, with no limit on loan size. However, try to apply for an 80% LVR home loan to avoid paying Lenders Mortgage Insurance.
Saudi Arabia has a 0% tax rate, making it an attractive prospect for Aussie expats. However, some lenders might apply Australian tax rates (which reach as high as 45%) to your Saudi income, reducing your borrowing power.