Written by

Steven Lee

Mortgage Director, ODIN Mortgage & Tax

10+ years in Australian banking and mortgage lending

Last reviewed

Updated on: October 8, 2026 View profile →

Australian expats searching for the best investment property in Australia in 2026 are no longer choosing between a Sydney apartment and a Brisbane house. A third option is gaining traction: build-to-rent (BTR), a model where large-scale residential buildings are constructed expressly to be rented long-term under single institutional ownership ^[4]. Alongside this, the long-running debate between buying and renting is being stress-tested by new research and shifting policy settings ^[1]. For expats structuring an investment from overseas, understanding how these asset classes compare on financing, tax, and long-term return is no longer optional; it is the foundation of a sound decision.

What exactly is build-to-rent and how does it differ from established residential property?

Understanding the structural difference between these two asset classes is the starting point for any informed investment decision. Build-to-rent refers to purpose-built residential buildings designed from the outset to be rented, not sold, with a single entity retaining ownership of the entire building. Under the finalized legislation, the single-entity ownership requirement must be maintained for at least 15 years to qualify for the enhanced capital works deduction ^[5]. This is fundamentally different from the established property market, where individual units or houses are sold to private owners who may then rent them out.

The key distinctions an investor should grasp are:

• Ownership structure: BTR is institutionally owned; established property is individually owned.
• Eligible investors: BTR developments must offer 50 or more apartments and are not sold as individual strata lots ^[4], meaning individual expats cannot purchase a BTR apartment the way they would buy an investment unit.
• Tenant experience: BTR typically offers longer lease terms and professional building management, which is one of the policy arguments made in favour of the model as an answer to housing insecurity ^[2].
• Liquidity: Established property is highly liquid relative to BTR fund structures; you can sell a house or unit independently, while exiting a BTR fund involves different mechanisms.

How can Australian expats actually access build-to-rent as an investment?

Building on the structural differences above, the harder question for an expat is: can you participate in BTR at all, and if so, how? The short answer is that direct individual ownership of a BTR development is not the model. Expat investors can access BTR exposure through two primary indirect routes:

This means that for most Australian expats, the BTR conversation is an investment thesis question, not a mortgage question in the traditional sense. The expat home loan in Australia remains primarily relevant to direct established property purchases. Expats interested in BTR exposure should seek independent tax and legal advice on fund structures, which falls outside the scope of mortgage broking.

What tax changes are reshaping the investment case for established property in 2026?

A related but distinct question from asset class access is how the tax treatment of each option is evolving, because this is where the investment calculus for established property is quietly shifting. Two policy changes are particularly relevant for 2026 expat investors:

Negative gearing reform (from 1 July 2027): From 1 July 2027, losses from established residential properties will only be deductible against rental income or the capital gains from residential properties, not against other income streams ^[3]. For expats using an established investment property as a tax-efficient structure today, this change warrants early planning. ODIN Mortgage works alongside ODIN to model the lending and tax implications together, rather than treating them as separate exercises.

BTR tax concessions from mid-2024 onwards: Federal and state governments have rapidly expanded BTR incentives since mid-2024, including changes to managed investment trust withholding tax rates and state-level land tax concessions ^[5]. These concessions are designed to attract institutional capital into the sector, not to benefit individual expat buyers directly, but they signal a structural policy shift toward BTR as a preferred housing supply mechanism.

How does financing established property actually work for Australian expats in 2026?

Stepping back from the policy landscape, a practical concern for any expat considering direct property investment is how lenders treat their income and residency status. Securing an expat home loan in Australia is not a uniform process across lenders; each lender applies its own policies on how to treat foreign-sourced income, which currencies it will accept, and what documentation it requires. These policies are not published in rate comparison tables and they change regularly.

Key factors that affect an expat’s borrowing capacity include:

• Income shading: Many lenders apply a discount to foreign income when calculating borrowing power. The discount varies by lender and currency.
• Acceptable currencies: Not all lenders accept all currencies. USD, HKD, SGD, AED, and GBP are more commonly accepted than less liquid currencies, but acceptance depends on individual lender policy.
• Residency classification: Whether a borrower is classified as a non-resident, temporary resident, or returning Australian resident affects both LVR limits and product eligibility. Borrowing power, LVR, and approval outcomes depend on individual circumstances and lender policy, which is subject to change.
• FIRB compliance: Foreign nationals and some Australian expats may require Foreign Investment Review Board approval before purchasing, depending on the property type and their residency status at the time of purchase.

ODIN Mortgage holds lender-by-lender data across 40+ Australian lenders on exactly these variables. This is not information available publicly; it is the product of more than a decade of non-resident deal flow, and it is the practical difference between a loan being approved at one lender and declined at another.

Is established property still the best investment property in Australia for expats in 2026?

The honest answer is: it depends on the investor’s objective, timeline, and tax position. Research on the long-term financial trade-offs between renting and buying in Australia shows the picture is more nuanced than the traditional “property always wins” narrative ^[1]. For expats specifically, the case for established residential investment remains strong for several reasons:

• Direct ownership provides borrowing capacity, which BTR fund participation does not.
• Established property offers flexibility for future owner-occupation on repatriation.
• Australian residential property markets in capital cities have historically demonstrated capital growth over long periods, though past performance does not guarantee future returns.
• Integrated mortgage and tax structuring (as ODIN provides) can optimise the after-tax return in ways that a passive BTR fund cannot replicate for an individual investor.

That said, the negative gearing reform from July 2027 ^[3], combined with growing BTR concessions ^[5], suggests that diversifying across asset classes is worth modelling. The Australian property landscape in 2026 is more policy-sensitive than at any point in the past decade ^[2].

Frequently Asked Questions

Can an Australian expat buy a build-to-rent apartment directly?

No. BTR developments are not sold as individual lots. They are held under single institutional ownership. Expats can access BTR exposure indirectly through listed REITs or unlisted wholesale funds, but these are not mortgage-financed purchases in the traditional sense ^[4].

Does the negative gearing reform affect expats investing in Australian property?

Yes. From 1 July 2027, losses on established residential properties will only be deductible against residential property income or capital gains, not against other income ^[3]. Expats currently using negative gearing structures should review their position with a qualified tax professional before this date. ODIN, part of ODIN, works alongside ODIN Mortgage on exactly this kind of integrated planning.

How does a lender assess an expat’s borrowing power?

Each lender applies its own foreign income shading policy, currency acceptance rules, and documentation requirements. There is no single industry standard. Borrowing power depends on individual circumstances and lender policy, which changes regularly. A specialist expat mortgage broker holds the lender-by-lender data needed to identify the most suitable option.

Do Australian expats need FIRB approval to buy property in Australia?

It depends on the individual’s residency classification and the type of property. Australian citizens are generally exempt from FIRB requirements regardless of where they live. Permanent residents living overseas and foreign nationals face different rules. ODIN Mortgage provides FIRB compliance guidance as part of its service, though formal legal advice should be obtained for complex situations.

Can I get an investment property loan in Australia while living in Hong Kong, Singapore, or Dubai?

Yes, subject to lender assessment of your foreign income, residency status, and the property type. ODIN Mortgage is headquartered in Hong Kong and serves clients across Singapore, the UAE, UK, USA, and 40+ other countries. The entire process can be completed remotely, including settlement via PEXA and remote document signing.

Is now a good time for expats to invest in Australian property?

This is a question that depends on individual financial circumstances, not a general market call. What is clear in 2026 is that the policy environment is shifting, particularly around negative gearing and BTR concessions, which makes early planning more valuable than waiting. Any investment decision should be considered alongside a full assessment of borrowing capacity and tax position.

References

1. Buy or Rent? The Australian Dream May Need a Makeover | FTI (www.fticonsulting.com)
2. Rethinking the Australian Dream: from homeownership to sovereign investment and secure rentals (thepolicymaker.appi.org.au)
3. Build-To-Rent’S Balancing Act: Will Australia’S Tax Tweaks Tip The Scales? | Altus Group Insights (www.altusgroup.com)
4. Dentons – Navigating build to rent: Latest updates on Commonwealth and state tax concessions – what investors need to know (www.dentons.com)