Buying property in Australia

Australian mortgages are available for residential property only. You can get a maximum loan of 70% loan-to-value (LTV) on a repayment or interest only basis for up to 30 years (to age 70). The minimum loan amount is £100,000.

Mortgages are typically arranged in Australian dollars or Sterling and can be in individual or joint names.

Affordability and proof of income

There are no non-status/self-certification mortgage facilities available in Australia. Therefore all loans need to be supported by a minimum of proof of income.

If you are employed, you will need to produce your last three months' payslips and your last two years' P60 and employer's reference.

If you are self-employed you will need copies of your audited accounts, tax returns and accountant's reference for the past two years together with your last three months' personal bank statements.

Lenders will use a calculation to establish whether you can afford to keep up with your mortgage repayments. Firstly, they will calculate five times your gross annual salary, minus any existing mortgage borrowing.

Secondly, an affordability ratio is applied. This means your total monthly commitment (for example, your UK mortgage payments and personal loan payments, plus your Australian mortgage) can't exceed 50% of your net monthly income.

Need to know

Once you've found the property you want to buy in Australia, you need to apply to the Foreign Investment Review Board (FIRB) for approval. All non-Australian nationals must go through this process on all types of property. You can obtain the relevant application forms on the FIRB website.

While you are waiting on the decision from the FIRB, you can apply for an 'agreement in principle' from the lender in Australia.

Once approval has been granted, you can enter into the contract with the lender to purchase the property.

Make sure you have researched every possible cost that you may get charged when buying your property. You should bear in mind that you may be charged by the government in addition to the lender's legal costs – these should be specified when you apply for the loan. These associated fees are usually between 10-15% of the property's purchase price.

Unless you are very experienced in purchasing abroad, it's important to seek some sort of legal advice before signing the contract for a property or paying a deposit.