What do you plan to do with the vacant land?

Banks have stricter lending guidelines for blocks of land than actual properties and, in many cases, they won’t finance remote or large properties.

The good news is that each lender has different lending guidelines so it’s still possible to get approved.

How much can I borrow for different block sizes?

  • Up to 2.2 hectares (5.4 acres): Up to 95% of the property value.
  • Up to 11 hectares (27.2 acres): Up to 95% of the property value (note that some lenders would restrict your loan to 80% of the property value).
  • Up to 60 hectares (148.3 acres): Up to 80% of the property value (note that most lenders would decline your loan but some specialise in hobby farms).
  • Over 60 hectares (148.3 acres): Up to 70% of the property value (all loans are assessed on a case by case basis).
  • Commercial farms: Up to 60% of the property value (all loans are assessed on a case by case basis using rural farm guidelines).
  • Guarantor loans: Borrow up to 100% with select lenders only.
  • If there’s a house on the block: If there’s a house on the land already, then you may be able to borrow 95% of the property value for properties up to 50 hectares in size.

For your reference, one hectare is equal to 10,000 m2 or 2.47 acres.

Note: Most lenders will have trouble approving mortgages for vacant land if the land is over 2.2 hectares in size. We have access to several lenders who can consider larger blocks of land depending on the strength of your application.

Our mortgage brokers are specialists in financing vacant land so please call us on 1300 889 743 or complete our free assessment form to find out how much you can borrow.


What will the bank assess?

  • Land size: The larger the land, the fewer the number of people who are interested in buying it.
  • Location: Land inside major cities and regional centres can be financed quite easily. At least one of our lenders has no location restrictions Australia wide.
  • Access: The land must have direct access using an all-weather road but dirt roads are acceptable as long as they’re well maintained and the property can be accessed by a standard vehicle (not a 4WD).
  • Services: The land must be within range to be connected to the electricity grid without excessive costs. Town water and sewerage services aren’t required as many Australian properties have tank water or septic tanks instead but some lenders will limit borrowing to 80% of the value of the property.
  • Zoning: Land zoned rural or rural residential can be considered but industrial, commercial and farm/agricultuatal zoning are case by case. If the land is subject to GST, it will typically be seen as a commercial property by the banks.
  • Land use: The land should be used for personal or investment purposes, not as a farm. Hobby farms with minor farm improvements and that generate little income from farm production are usually accepted.
  • Intention to build: Many lenders consider someone who’s building on the land right away or within a year to be a lower risk than someone who has no intention to build. If you’re not, the bank may consider you to be a speculative investor and may decline your loan.

Why are the banks so conservative?

When the economy is weak, vacant land tends to fluctuate in value and may take longer to sell.

This is particularly true in country areas and remote locations where land prices fluctuate more often.

Normal houses on the other hand tend to have more potential buyers and sell much faster.

Banks are more conservative when approving a home loan for vacant land as a result of the higher volatility of land prices.


Apply for a home loan

Please call us on 1300 889 743 or complete our free assessment form for more information about how we can help you.

Our mortgage brokers are specialists in financing remote properties and large blocks of land so they can quickly let you know if you can qualify for a mortgage.

  • T Cook

    Is there any restrictions on the land size that we could get a home loan for? Actually, I’m seeking to buy a vacant land of 25 acres in north Adelaide, so how much can I borrow from the bank?

  • Hi T Cook,

    There is no size limit set for a home loan, however the maximum some lenders can go up to 60 Ha. The lender bases its risk on the purpose and marketability of the property. As the property size increases, the risk to them also increases as large properties are usually difficult to sell quickly. Most lenders don’t lend to properties over 10 Ha, but as yours is just above 10 Ha, you could still get approved for 95%.

  • JW Fereday

    I have $40,000 in savings but I’d like to borrow at 90% LVR to buy a $385,000 vacant land. Can one of your mortgage brokers help with this?

  • Hi there, yes, our mortgage brokers can help with this. There are banks that can go up to 95% LVR for a land size of up to 11 hectares but over that, they will only lend 80%. This means that you needs to have a $77k deposit to reach 80% LVR on this basis. However, you can also go guarantor or use a personal loan as the rest of your deposit if your income is strong. Please call 1300 889 743 to discuss this in detail with one of our vacant land mortgage specialists.

  • TuiSiong Hie

    Hi, I currently have a shared (sibling) portfolio loan where I have up to $80K borrowing capacity. I would like to purchase a vacant lot in Katoomba/Leura for roughly $220K. Are there any lenders that would lend the $140K difference?

  • Hi TuiSiong

    Yes that should be fine. We’ve got experience funding vacant land around Katoomba / Leura. Be careful as some have fire zonings that mean that construction is expensive. Look out for flame zone in particular! Also if there are not power poles or other utilities connected then this can be expensive.

    So the cheap blocks of land often have a hidden catch!

    A joint loan with your siblings can be used as a deposit. Some lenders will assess the debt as if it is 100% yours and others wont. We can work out what is best.

  • TuiSiong Hie

    great! I’ll fill out your contact form.

  • tori

    Aren’t there any 100% vacant land loan offers?

  • No deposit land loans are available on the condition that you’re building on the vacant land within one or two years. In some cases, we can negotiate with the lender to waive the requirement to build.

    Land loans are very location dependant so if you’re not buying in a capital city or regional centre please call us on 1300 889 743 or complete our free assessment form to find out if your location is accepted by the banks.

  • Angelica

    I am in a very unique situation so I would like to discuss this in detail with one of your land loan experts. I have a couple of pdf documents that I would like to send. Where can I send these and explain my situation? I would really like to talk only after they have a look at my situation and assess it a bit.

  • Hey Angelica,

    You can email your details and all the necessary info including the documents to us at info@homeloanexperts.com.au and one of our brokers will look into it. We will then contact you within 24 hours to discuss it all in detail.

  • Alyce Wedding

    Hi there, my brother, husband and myself are looking into buying some land and building with a builders licence. We have gone to the bank and our approx. borrowing capacity based on our current incomes is around $600 – $650k. What is the process of buying land separately and then building on it privately and is this way of building harder to get bank approval?

  • Hi Alyce,
    If you mean building it yourself then yes this is much harder to finance. You can likely borrow 60% of the property value unless one of you is a licenced builder.
    Or do you mean using equity in other properties / your own cash to fund the construction? That is ok and a lot of people choose to do this where they have enough spare funds / equity.

  • Alyce Wedding

    Hi there, yes I am meaning we build ourselves :-) we are in the Building and Construction industry so we know a few builders instead of going with the usual ones like Metricon, Coral etc. We are wanting to buy land and build then use the equity in that property to build another property in order to start our property portfolio.

    Between the 3 of we are hoping to have approx. $55 – $60k for a deposit amount.

  • Hi Alyce that wouldn’t be enough for an owner builder loan unless you already own other properties with lots of equity in them. I’d say you’d likely have to go with a contract builder unless you have your own building licence in which case we could assist.
    You can read some more info here https://www.homeloanexperts.com.au/property-types/owner-builder/

  • Alyce Wedding

    Oh sorry I got confused, we would go with a contract builder not owner builder.

  • Ok then likely this should be ok. It is a little more complex with three people buying together but as long as you have talked to each other about your future plans and are on the same page then this is fine. Please contact us if you’d like our help to get your construction loan approved https://www.homeloanexperts.com.au/free-quote/

  • Jolene Banks

    We are looking at purchasing a rural vacant block of land in 4310 but no body loans for our area for land with no dwelling? is there anything else we can do?

  • Hi Jolene,
    The Boonah area is considered high risk by several lenders despite its proximity to the GC / Brissie. We can finance up to 95% for vacant land up to 11 ha or if you buy a property with a house on it then 50 ha should be fine. Larger sizes would require a larger deposit.

  • Richie K

    Hello, 5 banks already say no to a loan for a rural vacant land, size greater than 50 hectares, that was the problem. All the banks my broker spoke to says it was outside their scope, got something to do with new “Regulations”.

    Actual size: 65 hectares
    Postcode: 4275 Canungra area

    I have more than 30% deposit
    I also have a solid income. So repayment will be no problem.

    Does anyone know which smaller/other banks would ready to take this on.

    Contact me on
    richie_k@live.com

    Don’t waste my time please, as I myself and a few brokers already done the research.

    Please do full research before contact me. Once sure, I am happy to hear from you.

    Richie

  • Hi Richie,
    Vacant land over 50ha is difficult. If it was a house this would be ok.

    This is a case by case basis and we’d need to know more info about the property, in particular regarding access, if there are services available (power) and the likely uses of the land.

    We’d need a full application from you to assess it. Unfortunately it isn’t possible to assess just the location and size of the property and determine the lender that can help.

  • Richie K

    Yeah, Im ready for full application after you assessed it.

    heres the answers you seek.

    – Site has power
    – site has no building
    – recreational use, weekend motorbike (no income will be produce from this)

    – price is $400,000
    – I have 35% savings, and solid income.

    ‘case by case’ that is what my broker said aswell, but after a week, he turned around and said no, bank just got a regulation that if >50 hectares, its outside their scope.

    So if you know any private lenders that don’t have that restriction. Call me.

    Richie

  • Unfortunately Richard we cannot assist without a full application. It takes a significant amount of work for us to assess and find solutions for this kind of application and without the full picture it isn’t possible for us to help you. If you’d like our help then please complete this and contact one of our brokers https://www.homeloanexperts.com.au/free-quote/
    We do have access to more lenders for rural finance than other brokers so while I can’t offer you any guarantees I can say that it isn’t a waste of your time to send us your full details.

  • Jess

    Hi can you advise which lender would look at a $357,000 mortgage on a 45 acre property in Nornalup WA 6333. Purchase price of the rural zoned land is $420,000. The property has a weekender classified shed with plumbing septic, power and water and we intend putting housing onto the land in the next 12 months.

  • Hi Jess,
    It would depend on the shed, however if it’s classified as vacant land we can lend 80% of the property value.
    If it’s classified as a house then we can lend 95%. When you build we can lend 95% of the land cost plus cost of construction.
    So potentially you will need a little more money to settle the land but when you build you will have enough equity. You’d be eligible for competitive interest rates.
    If you’d like our help then please contact us here https://www.homeloanexperts.com.au/free-quote/

  • Bruce Oliver

    Good afternoon, looking at purchasing 5 acre block in 3747 for $205000. Own a home in 3153 on 980m2 with $100k owing. (Probably $400-$500k equity). Your advice? Can we refinance both to access equity as we need to finance a shed, tanks and sewerage on the block also, prior to selling up and building in a few years. Regards, Bruce.

  • Hi Bruce,

    Yes we can assist with this. You’d be looking at a loan for approx $305,000 + purchasing costs + improvements (shed etc) from what I can see.

    With some of our lenders we can use your home as the sole security for the loan and then you’d get lower home loan rates rather than paying higher rates for the $205,000 used to buy the land (technically the land is an investment property). Looks like you have plenty of equity so this should be ok. Your home is in a prime lending location as well. The land is in a remote area so there is less competition from lenders and the rates aren’t as good. In other words best to use your home as security.

    You can contact us here if you’d like our help https://www.homeloanexperts.com.au/free-quote/

  • Hi Bruce

    Our system will automatically allocate you to a vacant land specialist. Thanks

  • alex

    Hello,

    I’m interested in a 3ha portion of land in Forbes NSW, it is zoned RU1 Primary Production dwelling houses are permitted within the zone and the subject site was subdivided as a concessional lot with building entitlement. The site is connected to power, has access to bore water, telecommunications and has road access. The surrounding land is owned by my parents and is used for extensive agriculture. My question is what form of loan would be required a hobby farm loan? or a farm loan? I intend to build in the next two years. The land is valued at $80,000.

  • Hi Alex,
    This would be acceptable for a hobby farm loan for up to 95% of the land value. We’d need to have the full details of your situation to confirm this.

  • Pacs

    Hi I m interested to buy land with 25 acre and its vacant land there is no property on it . It’s in Green wedge Zone. It’s in mount cottrell in melbourne. Can anyone let me know how much maximum I can borrow on this type of loan

  • Hi
    It’s likely we can lend 95% of the land value as long as it doesn’t exceed 11 hectares. If it’s over that then 80% is the maximum.

  • Mat

    Hi – looking at buying a 5 acre block of land in Sth Burnett area (Qld). We really just want to keep it vacant in the meantime and have no intention to build a complete house on it. Maybe a shed with living quarters built within next 3-5yrs. Want to camp on it during holidays. Do any banks lend on this sort of thing? Cheers.

  • Hi Mat,
    Yes vacant land can be used as security for a loan. The zoning, access and power being available would be important. Typically you can borrow up to 90% of the value of a 5 acre vacant block of land.

  • Haydn

    Looking at buying 1 ha block without a house. I will looking at building within 18 months. I have 10% deposit saved already and the property is in NSW. Will I be eligible for a land loan ?

  • Hi Haydn
    Based on what you’ve written you should be eligible. However there is a lot more to your situation that could affect your application such as your income, employment, credit history, the location of the land and the lender you apply with. If you’d like our help then please call us on 1300 889 743. Thanks and good luck!

  • Olivia

    Hello! We are looking at a bush block that’s 140 hectares and to build within 12 months. Property is northern VIC. Will it be difficult to secure a loan?

  • Hello Olivia
    Yes a 140 ha block is very difficult to finance. These can only be financed around 60% of the property value so you’d need a large deposit or other property to use as additional security.
    A better alternative may be to look for properties under 50ha. Vacant land under 50ha you can borrow 80% of the property value. A house under 50ha you can borrow 95%.

  • Mandy

    I purchased a block of land in Ipswich last year and am planning to start the construction. I want to know what are the basic documents to provide to the bank for a construction loan?

  • Hi Mandy, it’s important to provide as many details and documents of the building plans as possible. This includes: building contract or a formal written tender, full copies of the council approved plans, builder’s schedule of finishes/specifications, and additional documents such as the builders insurance will be needed before starting construction. You could check here for the documents that are usually required to submit a loan application. https://www.homeloanexperts.com.au/home-loan-documents/documents-loan-application/

  • peter brown

    my wife and I are 58 & 60 respectively (still happily working fulltime) and want to buy almost 5acres of vacant land 20kms from Ballarat in Victoria with the idea of paying it off over 10years, then getting services connected & purchasing a kit home and retiring there . Do you think we’ll get a loan on that basis?

  • Hi Peter,
    This is a possibility, as long as you intend to retire 10 or more years from now, your profession is one that can be worked at age 70 (e.g. not manual labour) and you have other assets that could help to pay off the loan e.g. superannuation or property. We’ve got some more info on this here https://www.homeloanexperts.com.au/home-loan-articles/retirement-age-home-loan/

  • Adeeb

    Hi i like buy a vacant land in goulburn around 200k and i have deposit 25k is it ok as a deposit or how much i need to to buy vacant land and how much repayment will be for that ?

  • Hi Adeeb,
    Yes that is approximately enough to complete the purchase. You may need a couple of thousand more just to be safe.
    The approx repayments would be $907 / month assuming you borrow $190,000 over 30 years at 4% p.a. This is a rough guide only, it’s likely you would get a slightly lower rate than this.

  • Steve

    Hi.
    We would like to purchase a block of land in the Illawarra. 550sqm. Price is $550,000.

    We would like to borrow the full amount. We own our own home outright worth $800,000. Plus.
    We would sell this to pay the loan out. Then build on the block.

    Thanks Steve

  • Hi Steve
    Yes this looks doable. If your income allows it then you may want to build and then sell your home. That way you don’t have to rent until the construction is complete, and move house twice.
    It may even be possible to structure this so that you get home loan pricing, many lenders would give you investment loan pricing (which is more expensive) because you are building on a property that isn’t your home.
    I’ll email you and cc one of our brokers who specialises in construction.

  • Eddie

    Looking at a under 50 acre hobby farm outside of Melbourne between $600-$700k, all power connected, water supplied and home established. What is the expected borrowing/deposit percentage? Thanks in advance.

  • Hi Eddie,
    It’s likely you can borrow 95% of the purchase price of the property including Lenders Mortgage Insurance (LMI) with our lenders. That means you’d need approximately 13% of the property price approximately to cover the deposit and costs such as stamp duty and LMI.
    Also note that you don’t need a deposit if you have a guarantor https://www.homeloanexperts.com.au/guarantor-home-loans/.

  • Mitchell

    Looking at buying a 100 acre block near casino nsw for $450000 have intent to build a house on the land and added costs of connecting power. We have a $90000 deposit. Would we be able to secure a loan with enough equity to build

  • Hi Mitchell,
    Yes a 100 acre block is acceptable. You’d need to borrow 80% when you buy the land ($90k is only just enough) and then when you go to build you would be allowed to borrow up to 95% of the land value plus cost of construction. So you will be ok. Only one or two lenders can assist with this, I’ll email you and cc a specialist in this area of lending. Best of luck!

  • Robyn Jane

    We are looking at purchasing a 5 acre block of land at Taromeo for $195,000. Power is not conected but is outside the boundary ready to be connected. (Right now we don’t want the power connected as we would be looking at being off grid using solar). There are also buildings on the property but they aren’t council approved as the owners have only been using it as a weekender. It has i think 4 tanks as well. & comes with a tractor & slasher. We are looking at buying it to retire on & holiday at until then. We have a house with about $136,000 owing & approx about $200,000 equity. (I’m not sure exactly what it’s worth). Thanks for your time

  • Hi Robyn,
    Taromeo QLD 4306 is a good area from a lenders point of view and so that aspect is fine. The land size is acceptable to most lenders. Power availability is fine however when you build some will not be ok with it being off grid. Likely should be fine.
    The improvements to the property are a potential issue. We’d expect lenders to allow you to borrow 80% of the value of the land only (ignoring improvements and tractor / slasher). You can borrow up to 90% of the value of your existing home. So it’s likely this is feasible if you have the income to support both loans.

  • Katrina Williams

    Hi … I have a 25 acre block at Glenorie that I want to purchase if my partner in a property settlement. I currently owe just under $300,000 on the mortgage and must pay him out $300,000 as well.

    The bank is not keen to lend me the money for vacant land although they valued it at 1.1 million when assessing the loan. I need a loan for around $600,000, which makes the loan 50% of the market value.

    I am employed full-time and earn $100,000 per year. Could you please advise what I can do to borrow this amount? Thank you.

  • Hi Katrina,
    This would all depend on your borrowing power. Assuming you have no other debts, no children and are living rent free with family you can afford it. So it then comes down to what debts / commitments you actually have as to if you can make this work or not.
    Lenders assess borrowing power in different ways so we just need to look at your situation to work out the best way forward. I’ll email you and cc one of our mortgage brokers who is an expert in this area of lending.
    Best of luck with your settlement.