What Is The Average Expat Mortgage Size In Australia?
For many working people in Australia, acquiring a home with a fair mortgage is not only essential but extremely challenging. However, securing a mortgage can be even more difficult and stressful for expats in Australia.
Recent years have made the mortgage process even more difficult for ex-pats because multiple well-known vendors have pulled their funding for expat mortgages. Therefore, understanding the current mortgage market in Australia is beneficial.
Continue reading our guide to the average mortgage size in Australia for the average mortgage size by state and type, the median monthly mortgage repayment for expats, and more!
Average Australian Mortgage Sizes By State
The national average size for a mortgage in Australia floats around $549,493 (according to a May 2021 report by the Australian Bureau of Statistics, or ABS). However, the average mortgage size differs from state to state. Here are the average Australian mortgage sizes by state (last updated in Jan 2022).
- New South Wales (NSW) has the largest average mortgage size with around $804,675.
- Victoria (VIC) has the second-highest average mortgage size with $652,000
- The Australian Capital Territory’s (ACT) average mortgage size has risen significantly to trail behind Vitoria with $641,000.
- South Australia’s average mortgage size rose steadily from $406,086 in July 2021 to $457,493 in January 2022.
- The Australian Northern Territory’s average mortgage size went down from $406,598 in July 2021 to around $400,000 in January 2022.
- The average mortgage size in Tasmania was at $380,932 in July 2021 but is now at $428,000.
- Western Australia’s average mortgage size is rising slightly; in July 2021, it sat at $430,248, and it sat at $463,844 in Jan 2022.
- Queensland’s average mortgage size rose from $457,006 in July 2021 to $516,686 in Jan 2022.
Get a free Australian mortgage assessment today.
Average Home Loan Amount In Australia
Now you know the average mortgage sizes in each Australian state, you need to know how much the average home loan amount is for each type of home loan. Here are the main types of home loans in Australia and how much the average price has risen in Jan 2022 (in a report by the Australian Bureau Of Statistics).
- For a home loan on existing properties, the average loan size rose by 2.3% (the average home loan on an existing property was $578,335 in June 2021), resulting in a rise in loan commitments for existing home loans.
- For the purchase of a new property, the average Australian home loan price rose by a tiny 0.3% (the average loan for a new home was $544,325 in June 2021). However, the average home loan price was around 6% higher about a year prior.
- For the construction of a new property, the average loan size decreased by 3.6% (the average loan for a property under construction was $455,331in June 2021). However, the average home loan price for a property under construction was around 46% higher about a year prior.
Details About New Home Loans For Expats
Although the statistic for the average mortgage for each state and type are relevant to an extent for expats in Australia, there are details that expats should consider when taking one out. These details include getting approval from the Foreign Investment Review Board (FIRB), higher costs, hidden costs, documents they need to provide, and more.
Foreign Investment Review Board (FIRB) Approval
First, it’s worth saying that you can buy a property in Australia if you aren’t a resident. However, you must jump through more hoops than a resident to purchase a property in Australia.
The first significant element an expat needs to complete to acquire a property in Australia is to get Foreign Investment Review Board (FIRB) approval. You also need to get their approval for the specific property you want; there is a FIRB fee for this approval, but the fee will be lower if you buy a new property or property under construction.
Potential Hidden Charges
One aspect of mortgages that expats need to be aware of is the potential for higher and hidden charges. Some of these potential charges include:
- Extra charges on interest rates: Charges on interest rates depend on what interest rate you get; you can get a fixed interest rate, a variable interest rate, or a combination of both (for first-time buyers). You should check the average interest rate to see if they are fair.
- Legal fees: There are many potential legal fees, including lawyer fees. These can go up to $2000, depending on the quality of the lawyer.
- Loan establishment fees: The fee ex-pats need to pay to confirm the home loan; is usually around $900.
- FIRB approval fees: The FIRB approval fees depend on the property’s price.
- Foreign citizen stamp duty: The foreign city stamp duty fees depend on the property’s price.
- Property inspection fees: The Property inspection fees can be around $800 for expats.
Loan To Value Rate For Expats
Expats should be able to get a mortgage with around 80% loan to value as long as they don’t hfail the previous steps. Your bank will base the exact amount you can borrow on how much you earn, your savings, your credit history, your Visa status, and more.
Documents You Need To provide
If you’re an ex-pat, you must make sure you have all of the necessary evidence to provide; here is the evidence you will need:
- A copy of your ID: Driving license or passport.
- Proof of your creditworthiness: A credit check from your credit provider, bank statement, proof of your wages, or a tax return.
- Evidence to prove you can afford the mortgage: Utility or a bank statement.
Get a free Australian mortgage assessment today.
What Is The Median Monthly Mortgage Repayment For Expats In Australia?
When you secure a mortgage, an essential element is to know what your monthly repayments will be; this is especially important for expats because they need to know the precise number for their research.
Here is a table covering a report by the Australian Bureau of Statistics in March 2022. They cover the mean value of monthly repayments (including interest repayments) in all Australian states and cover all mortgage types (existing property, new property, and properties that need building).
|Australian State||Existing Property Monthly Mortgage Repayments||New Property Monthly Mortgage Repayments||To-be-built Property Monthly Mortgage Repayments|
Australian Capital Territory (ACT)
Northern Territory (NT)
Southern Australia (SA)
Western Australia (WA)
New South Wales (NSW)
How Can Expats In Australia Calculate Their Cost Of Mortgage Repayments?
Calculating your mortgage repayments per month can be challenging because expats need to think about the following aspects:
- The fees on the account.
- The terms of payment on the mortgage agreement.
- The amount of the home loan.
- The interest rates and interest repayments on the mortgage.
Knowing where to start when calculating your mortgage payments per month can be daunting. Thankfully, you can use our ODINMortgage mortgage repayment calculator to calculate your monthly payments (including interest and extra repayments).
For example, we inputted a dummy $500,000 mortgage into our calculator to show you the repayments.
For a $500,000 home loan with a 3% interest rate, the minimum repayment will be $2,108.02 per month. Over a 30 year term, you would save $13,565.54 in interest.
How Many Years Should An Expat Opt For With An Australian Mortgage?
Usually, the home loan repayment term can last between 10 and 30 years. However, most homeowners go for 30 years because it gives them a better financial situation and less mortgage stress.
Expats temporarily living in Australia should consider a smaller repayment term (if they can afford it) if they need to take out a loan in a different location.
How Much Expat Income Should Go Into Home Loan Repayments?
The amount of monthly income an ex-pat should place into their repayments will be entirely individual; it can depend on the home loan’s size, income, monthly budget, mortgage interest rate, and more.
However, generally, you should look to put aside between 25-30% of your income for repaying your mortgage (28% is the most common practice). It is inadvisable to add more than that amount per month because you will strain your finances and get into mortgage stress.
Remember that it is entirely individual; there isn’t a rule that you can’t add more than 30% a month. You will benefit by repaying your home loan more quickly if you can afford it. However, you should still budget so you know what you can and can’t afford.
Get a free Australian mortgage assessment today.
Average Mortgage Australia: Final Summary
Overall, the average mortgage size for an expat in Australia isn’t clear cut; it entirely depends on what state you live in (Northern Territory, Australian Capital Territory, etc.) and type of home loan you go for(The ABS reports the average mortgage size a few times every year).
Home loan repayments are also not completely definitive because they can depend on the size of the home loan, income, monthly budget, mortgage interest rate, and more. However, you can use our ODINMortgage mortgage repayment calculator to calculate the repayments for your home loans.
Frequently Asked Questions
How Large Is The Average Mortgage Size For Ex-pats In Australia?
The average mortgage size for ex-pats in Australia depends on several elements. It depends on the state you will live in (Northern Territory, Australian Capital Territory, etc.) and the type of home loan (new property, existing property, etc.).
Although the state average mortgage sizes vary, the national average size for a mortgage in Australia is $549,493 (according to a May 2021 report by the Australian Bureau of Statistics).
Can An Ex-pat Get A Mortgage In Australia?
If you are an ex-pat, you can most certainly acquire a mortgage for a property in Australia.
However, there are several aspects you will come across to secure a mortgage, including higher costs, multiple documents to provide, getting approval from the Foreign Investment Review Board (FIRB), and more.
What Are The Median Monthly Repayment Requirements For Australian Ex-pats?
The median repayment requirements per month depend on a few elements, including the expat’s monthly income, the overall size of the home loan, the interest rates, and more.
Use our ODINMortgage mortgage repayment calculator to input your specific information and calculate the repayments.
What Is The Best Repayment Term Time For An Ex-pat In Australia?
Usually, the home loan repayment term lasts 10 to 30 years. However, most homeowners go for 30 years because it gives them a better financial situation.
Expats temporarily living in Australia should consider a minor repayment term if they need to take out a home loan in a different location. Alternatively, they can go for a larger repayment term to give themselves more financial freedom.