Home Loans for Indigenous Australians
Low interest home loans for Aboriginal people across Australia are available for eligible applicants.
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Where can you get Indigenous home loans?
Government assistance programs for Aboriginal home loans are available across Australia. These programs are designed to help as many Indigenous Australians as possible to qualify for a home loan.
The table below shows where Indigenous Australians across Australia can get help to access a low interest home loan. All of these assistance programs are specific to Aboriginal Australians except the South Australian programs. All programs are also State or Territory-specific except the national Indigenous Home Ownership Program and Remote Indigenous Housing Loans.
| Home loans for Aboriginal Australians | State/Territory government authorities |
|---|---|
|
New South Wales |
The Home Ownership Deposit Co-contribution Scheme administered by the Aboriginal Housing Office |
|
Victoria |
The HomesVic Shared Equity Initiative |
|
Queensland |
The Remote Home Ownership Program and Home Ownership Leases |
|
South Australia |
The Affordable Homes Program and HomeStart Finance |
|
Western Australia |
The Aboriginal Home Ownership Scheme (administered by Keystart) |
|
Tasmania |
The Indigenous Home Ownership Program and Remote Indigenous Housing Loans (these are nationally administered programs via Indigenous Business Australia) |
|
Australian Capital Territory |
The Indigenous Home Ownership Program and Remote Indigenous Housing Loans (these are nationally administered programs via Indigenous Business Australia) |
|
Northern Territory |
The Home Ownership Sublease Programv |
Does Indigenous Business Australia (IBA) provide home loans?
Yes, the IBA runs the national Indigenous Home Ownership Program (IHOP). This program is designed to make it easier for Indigenous Australians to get home loans. Their lending approval criteria aren’t as strict as mainstream lenders.
According to the latest figures from the Australian Institute of Health and Welfare, 38% of Indigenous Australians are home owners. This is much lower than the overall Australian figure of 67%.
The IBA approved $166.1 million worth of Aboriginal home loans according to its annual report for the 2019/20 financial year. Over 95% of these loans were approved for first home buyers. Many of these buyers would have been unable to meet the higher lending approval criteria of mainstream lenders. However, the IBA does help successful applicants to transition to mainstream home loans over time.
The table below lists the deposits needed for IBA home loans for first home buyer applicants.
| Annual gross income | Minimum deposit required |
|---|---|
|
Less than $76,378 |
$1,500 |
|
Between $76378 and $125,798 |
$3,000 |
|
Between $125,799 and $148,262 |
3% of the property purchase price |
|
Between $148,263 and $202,176 |
5% of the property purchase price |
You can use our borrowing power calculator to work out how much you may be able to borrow.
The standard variable rate for an IBA home loan is 4.14% as at 1 December 2020. This rate is subject to change at any time. However, first home buyers are eligible for a temporary discount off this rate depending on their income. These discounts are usually for a minimum of 12 months to 2 years and are outlined in the table below. The rate will gradually increase until it reaches the standard variable rate.
| Gross income | Introductory interest rate |
|---|---|
|
Less than $76,377 |
2% |
|
Between $76378 and $125,798 |
3% |
|
Between $125,799 and $148,262 |
3.5% |
What is the Remote Indigenous Housing Loans scheme?
This is another program run by the IBA. As the name suggests, it is designed for eligible Indigenous applicants living in more remote parts of Australia.
This scheme provides additional benefits to the Indigenous Home Ownership Program. These benefits include:
- an even lower minimum deposit (as little as $1,500, depending on your income).
- a $20,000 grant being available for renovations, repairs and maintenance.
The table below lists the remote locations where the Remote Indigenous Housing Loans scheme is available.
|
New South Wales |
Bourke, Baradine, Brewarrina, Collarenebi, Cobar, Coonamble, Hilston, Lightning Ridge, Lake Cargelligo, Menindee, Nyngan, Narrabri, Wilcannia, Walgett |
|
Queensland |
Charleville, Camooweal, Cooktown, Cunnamulla, Coen, Longreach, Mitchell, Quilpie, St George, Winton, Yowah |
|
Western Australia |
Carnarvon, Halls Creek, Kununurra, Onslow Town, Wyndham |
|
South Australia |
Umoona |
|
Northern Territory |
Timber Creek, Tennant Creek |
What are the benefits of home loans for Indigenous Australians?
There are several benefits of an Indigenous home loan compared to a standard home loan. Aboriginal home loans typically:
- require less deposit.
- have longer terms (32 years, as compared to the standard 25 or 30-year home loan term). This longer term can lower your repayments.
- are either partly or fully funded by governments.
- have reduced or government-subsidised fees.
- don’t require you to pay for lenders’ mortgage insurance.
They also may:
- provide you with a grant to help you cover your costs.
- involve a co-ownership arrangement with a government housing authority.
Each of these benefits can help eligible Indigenous Australians to achieve the great Australian home ownership dream sooner.
However, it’s important to understand that there is often a waiting list for these loans. You should therefore check that you meet the eligibility requirements and apply up to a year in advance.Â
What are the eligibility requirements for Indigenous home loans?
These vary across different Australian States and Territories, but the following eligibility requirements generally apply.
- You (or your partner) will need to prove your Aboriginal/Torres Strait Islander heritage. Only one of you needs to be Indigenous.
- Your income must fall within maximum thresholds.
- You will need to come up with a minimal deposit that may be dependent on your income. The higher your income, the more deposit you will usually need to provide. However, if you’re a first home buyer, you may be eligible for the First Home Owners Grant (FHOG). This grant can help you with your deposit if you’re building a home.Â
- You must be able to demonstrate that you can afford your home loan repayments.
- You must be buying a home to live in, not an investment property.
- You must be aged over 18.
- You must be an Australian citizen or permanent resident.
- You must not currently be bankrupt.
What should I do before applying for an Aboriginal home loan?
Taking out a home loan is a big financial commitment. Before you apply, you should make sure that you can comfortably afford your repayments. You can do this by doing up a monthly budget of your income and expenses.
Make sure the budget is realistic and accurate. It should include all your income and expenses. If you have expenses that only happen every quarter, divide the amount by 3 to include in your monthly budget. Half-yearly expenses should be divided by six and yearly expenses should be divided by 12.
Divide your expenses into two categories: essential and non-essential. Eliminate or reduce your non-essential expenses so you’ll have more money available for your home loan repayments.
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