What is the minimum or maximum sized home or block I can get with a home loan?

author-avatar By on July 26, 2021
What is the minimum or maximum sized home or block I can get with a home loan?

Have a trendy apartment or dreams of making a big tree change? Find out if your floor plan size or property makes the cut for a regular home loan.

If you’ve been at an auction and wondered why that trendy inner-city apartment struggled to make reserve, it could be because of its ineligibility for a normal home loan due to the small floor plan, turning away some buyer interest. Similarly, if you’ve wondered why a huge block is going for relatively good value, it could be because a lender doesn’t want to lend in rural areas, or has a cap on the land size.

Savings.com.au reached out to a range of major banks, challengers, customer-owned banks, and non bank lenders to find out where they stand on floor plans and property sizes.

In this article…


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Minimum apartment floor plan size for home loan

Lenders typically have their own set of requirements in regards to the minimum square footage - or 'metreage' - of the floor plan. They may or may not include things like balconies and garage spaces in the equation. This could potentially rule out some smaller apartments, so double check before you buy or bid.

Note: Westpac and Commonwealth Bank declined to participate in this article.

ANZ

"ANZ uses a number of policies and criteria when determining eligibility for a loan, including the type of property to be used as collateral. Location and quality of the property are also considerations," a spokesperson told Savings.com.au.

"While we will require larger deposits for some smaller apartments, there is no absolute restriction on the minimum size of the dwelling."

NAB

NAB confirmed the minimum floor plan requirement is 50 sq m, inclusive of balcony and car park.

86 400

A spokesperson for 86 400 confirmed the minimum floor area for apartments is 40 sq m (excluding balconies, car parking and storage cages).

AMP Bank

"AMP Bank’s minimum floor plan requirements for units/apartments is one bedroom; 40 sq m in metro areas, and 45 sq m otherwise (excluding balconies and car accommodation)," an AMP spokesperson told Savings.com.au.

Athena

Online lender Athena confirmed with Savings.com.au the minimum floor plan size is 50 sq m, excluding garage and balcony.

"For properties that don’t fit the above, we offer Athena Select. It’s our broker service where we find a lender that suits the customer’s needs if they aren’t eligible for an Athena home loan," an Athena spokesperson said.

"Although it’s something we offer we don’t advertise this."

Bank of Queensland

A spokesperson informed Savings.com.au that the minimum floor plan size is 40 sq m, subject to "extra credit commitments", such as the location of the property, and individual borrower specifications.

They also urged potential borrowers to reach out directly, as applications are done on a case-by-case basis.

Bendigo and Adelaide Bank

A spokesperson for the brand confirmed the minimum is 50 sq m for a one bedroom apartment, and 60 sq m for two bedrooms.

Citi

A Citi spokesperson told Savings.com.au the minimum unit size is 40 sq m of living space, excluding garage and balcony.

"Citi is a niche player in Australia’s mortgage market, making up less than 2% of market share," they said.

"Accordingly, we have limitations on the types of loans that we progress so we can focus on lending in specific areas, for example for complex loans for high net worth individuals."

Greater Bank

"Dwelling is to be > 40 sq m in size (excluding balconies and parking) and have at least one bedroom (separate from living areas), lounge/dining, kitchen/laundry, bathroom or bathroom/laundry," a Greater Bank spokesperson said.

Great Southern Bank (formerly CUA)

A spokesperson for Great Southern Bank said the minimum is generally 50 sq m, but "do go smaller on a case by case basis."

homeloans.com.au

"40 sq m minimum floor size for apartment under 'Flex' (our specialist loan)," a spokesperson told Savings.com.au.

"50 sq m minimum floor size under 'Low Rate Home Loan' (our prime loan product)."

HSBC

A HSBC spokesperson confirmed the minimum living area must be 45 sq m, excluding balconies and car space.

loans.com.au

"The minimum living area for a unit (excluding balcony/outdoor, car space etc) is 40 sq m in a capital city or metro location, and 50 sq m if not in capital city or metro location," a loans.com.au spokesperson told Savings.com.au.

Macquarie

A spokesperson for Macquarie told Savings.com.au the minimum floor plan size is 50 sq m, however some additional credit criteria may apply, such as a lower loan-to-value ratio, i.e. a bigger deposit.

Newcastle Permanent

A Newcastle Permanent spokesperson confirmed the lender accepts units "greater than 50 sq m".

However, additional LVR restrictions may apply if the unit is located in a high density apartment complex.

Suncorp

Suncorp confirmed the minimum floor plan size for an apartment is 50 sq m.

Teachers Mutual Bank

"The size of the dwelling must be a minimum of 35m2 in floor space, excluding balconies and car space for studio or one bedroom units," a spokesperson told Savings.com.au.

"The size of the dwelling must be a minimum of 60m2 in floor space, excluding balconies and car space for two or more bedroom units."

This also applies to Teachers Mutual subsidiaries including Firefighters Mutual Bank, Health Professionals Bank, and UniBank.

Virgin Money

Bank of Queensland - which underwrites Virgin Money home loans - confirmed that the minimum apartment floor plan size is 50 sq m.

Yard

Yard CEO Toni Mladenova detailed the non-bank lender’s requirements for apartments.

"Yard can accept small units and studios as eligible property. Minimum floor requirements are 35 sq m internal living area for strata title properties," Ms Mladenova told Savings.com.au.

"If the property is outside high demand capital city areas, then the minimum internal area requirement is 40 sq m."

Maximum land size for home loan

By the same token, mainstream lenders typically have a maximum land size they are willing to lend money for, but it usually numbers into the many hectares. While not a worry for most suburban or even semi-rural blocks, it could be an issue if you’re wanting a bigger slice of the pie.

Note: Westpac and Commonwealth Bank declined to participate in this article.

ANZ

"In terms of large rural residential properties, we will lend up to 50 hectares, although we will require a larger deposit," a spokesperson said.

NAB

NAB confirmed the maximum is 10 hectares, or 25 acres.

However, for vacant land (no residence or dwelling on the property), the maximum is 2.2 hectares, or five acres.

86 400

For land size, 86 400 confirmed the maximum is 10 hectares and must be rural residential property, i.e. it can be a rural block in a rural town but not a commercial farm.

AMP Bank

"The maximum land area is up to 40 hectares (100 acres) with a dwelling, whether zoned as residential, rural residential or rural. For vacant land, the maximum area is two hectares (five acres)," AMP Bank's spokesperson said.

Athena

Athena confirmed the maximum land size allowable is six hectares.

Bank of Queensland

A BoQ spokesperson confirmed the maximum land size allowable is 40 hectares.

This also applies to Virgin Money home loans, which BoQ underwrites.

Bendigo and Adelaide Bank

The joint outfit confirmed the maximum land size allowable is 10 hectares.

Citi

Citi confirmed the maximum size allowable is four hectares.

Anything over two hectares must be owner occupied, and is subject to a lower LVR i.e. a bigger deposit.

Greater Bank

Greater Bank confirmed the maximum land size with a dwelling is up to 70 hectares, whereas vacant land is up to 50 hectares.

Great Southern Bank

Great Southern Bank confirmed there is no maximum for land size.

homeloans.com.au

A spokesperson for the company told Savings.com.au the maximum land size is 10 hectares.

HSBC

HSBC confirmed the maximum allowable land size is up to 10 hectares.

loans.com.au

"[For] land with a dwelling on it, [the] land size is 10 hectares. We don't accept vacant land as security unless there is a building contract and we are doing a construction loan," a spokesperson said.

Macquarie

Macquarie confirmed it can lend to properties larger than 10 hectares, however some additional credit criteria may apply, such as a lower loan-to-value ratio, i.e. a bigger deposit.

Newcastle Permanent

Newcastle Permanent’s maximum land size it will lend for is 50 hectares, however additional LVR restrictions may apply for properties greater than 10 hectares.

Suncorp

Suncorp confirmed vacant land is up to 10 hectares, while the the maximum for residential properties is anywhere between 10ha and 50ha.

Teachers Mutual Bank

“The size of the land, be it vacant land or on which the dwelling is located, must be no more than 40 hectares,” a spokesperson said.

This also applies to Teachers Mutual subsidiaries including Firefighters Mutual Bank, Health Professionals Bank, and UniBank.

Yard

"We can do 80% LVR for properties up to 10 hectares. We can then consider properties between 10 up to 40 hectares but our max LVR changes - for example, we can consider 40 hectares property up to max 60% LVR," Ms Mladenova said.

"The property needs to be in a rural residential area and be connected to key services - electricity, water, sewage and have access to a sealed road."


Photo by Patrick Perkins on Unsplash

Disclaimers

The entire market was not considered in selecting the above products. Rather, a cut-down portion of the market has been considered which includes retail products from at least the big four banks, the top 10 customer-owned institutions and Australia’s larger non-banks:

  • The big four banks are: ANZ, CBA, NAB and Westpac
  • The top 10 customer-owned Institutions are the ten largest mutual banks, credit unions and building societies in Australia, ranked by assets under management in November 2020. They are (in descending order): Great Southern Bank, Newcastle Permanent, Heritage Bank, Peoples’ Choice Credit Union, Teachers Mutual Bank, Greater Bank, IMB Bank, Beyond Bank, Bank Australia and P&N Bank.
  • The larger non-bank lenders are those who (in 2020) has more than $9 billion in Australian funded loans and advances. These groups are: Resimac, Pepper, Liberty and Firstmac.
  • If you click on a product link and you are referred to a Product or Service Provider’s web page, it is highly likely that a commercial relationship exists between that Product or Service Provider and Savings.com.au

Some providers' products may not be available in all states. To be considered, the product and rate must be clearly published on the product provider's web site.

In the interests of full disclosure, Savings.com.au, Performance Drive and Loans.com.au are part of the Firstmac Group. To read about how Savings.com.au manages potential conflicts of interest, along with how we get paid, please click through onto the web site links.

*Comparison rate is based on a loan of $150,000 over a term of 25 years. Please note the comparison rate only applies to the examples given. Different loan amounts and terms will result in different comparison rates. Costs such as redraw fees and costs savings, such as fee waivers, are not included in the comparison rate but may influence the cost of the loan.

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author-avatar
Harrison is Savings.com.au's Assistant Editor. Prior to joining Savings in January 2020, he worked for some of Australia's largest comparison sites and media organisations. With a keen interest in the economy, housing policy, and personal finance, Harrison is passionate about breaking down complex financial topics for the everyday consumer.

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