Serviced apartment property finance

Ardent Capital Group brings the same method to every client: execution and strategy, clear advice for smart lending, and long-term growth. That means the right lender, structure and timing, straight advice so you borrow with confidence, and today's deal built toward where you want to be tomorrow. We are specialists in helping business owners secure finance to purchase their own property, and we understand the complex structures that often sit around it, including multiple trusts, holding companies and self-managed super funds. Funders often hesitate over whether a serviced apartment is residential or commercial, so it goes to those who understand letting income and management agreements and can read your occupancy figures as real trading. Long after settlement, the team stays here as you add to your holdings. Every figure is subject to serviceability, lender appetite and approval.

Management rights are the right to let and caretake a complex. You earn a caretaking salary paid by the body corporate for maintaining the common property, and commissions for letting the lots that sit in the letting pool. It is a business purchase, not a property purchase, and it is funded as a split facility that usually lands between 65% and 75% of the price all up, so the deposit runs to 25% to 35%. The price is normally a multiple of the verified net profit, and lenders require a verification report from a specialist management rights accountant before they will look at it.

Because the agreement is the asset. The income stops when the agreement ends, so the number of years left to run is what a lender is really funding. The remaining term drives the value, because the income runs with the agreement, and under about 10 years the LVR tightens, so we check the term first and, where it helps, arrange a top-up before you buy. In Queensland, standard module agreements run to a maximum of 10 years and accommodation module agreements to 25, and topping the term back up needs a resolution of the body corporate. Check the term and the last top-up date before you sign anything.

Size is a hard gate, and lenders measure internal living area, excluding balconies, storage cages and car spaces, so the number on the brochure is rarely the number they use. Above 50 sqm internal, most lenders are comfortable. Between 40 and 50 sqm the pool of lenders narrows and the LVR tightens. Below 40 sqm you are into specialist territory and a larger deposit, though the mortgage insurers will look at lots down to around 30 sqm in the right building. For serviced apartments specifically, 50 sqm internal is the line several lenders hold before they will consider their better LVR tier, no matter how well the lot lets. A small lot is financeable. It is just a shorter list of lenders and a bigger deposit.

An individual serviced apartment is generally funded to 50% to 70% of value, so a deposit of 30% to 50% is common. Where you land depends mainly on the size of the lot and whether it sits in a letting pool or on a residential lease. With extra security, a cross-collateralised structure can reach up to 100% of the price. The exact number depends on your file, so talk to us.

As two different assets. On a standard 12 month residential lease, the lot is close to ordinary residential security, so the LVR is higher and the loan term is longer. Committed to a short-stay letting pool, the same lot becomes specialised security: the LVR drops, the term shortens and the list of lenders willing to write it gets short. Leaving a pool takes notice under the agreement, and the exit terms feed straight into the valuation, so tell us before you change the letting arrangement.

The rules are real, but they are set by state planning frameworks rather than by individual councils, and they differ sharply by state. In New South Wales, non-hosted short-term letting is capped at 180 days a year in Greater Sydney, Ballina, and specified land in Clarence Valley and Muswellbrook. Byron Shire is tighter again at 60 days. Bookings of 21 consecutive days or more do not count toward the cap, and hosted letting, where the owner is on site, is not capped at all. Registration on the state register is mandatory. Victoria applies a 7.5% short stay levy to bookings under 28 days, and in Western Australia unhosted short stay in metropolitan Perth has needed development approval beyond 90 nights a year since January 2026. The point worth checking early, though, is the letting by-laws: in New South Wales an owners corporation can pass a by-law banning short-term letting in a lot, but only where the lot is not the owner's principal place of residence. If you are buying to let, those by-laws are what protect your income, so we confirm there is no restriction in place up front, which is exactly what a lender wants to see.

As a real cost, deducted from the letting income before serviceability is worked out. Administrative fund levies, sinking fund levies and any special levy for building work all come off the top, and on an older complex a special levy can be substantial. Lenders read the body corporate minutes and the sinking fund forecast to see what is coming. We read the body corporate minutes and sinking fund forecast early, so any upcoming levy is built into the return from the start.

For management rights, two to three years of the verified net profit from the caretaking salary and the letting commissions, the body corporate agreements, and the letting pool numbers showing how many lots are signed up. For an individual apartment, two years of pool distributions or short-stay income, averaged rather than taken at the peak season figure. Where the business has traded under a previous owner, that is the starting point, and a verification report from a specialist accountant is what a lender will rely on rather than the vendor figures alone.

For a full-doc application, most lenders want two to three years of business financial statements and tax returns, personal tax returns for all guarantors, the contract of sale, the strata plan showing the internal area, the letting pool or caretaking and letting agreement, and the body corporate records. Many operators do not fit a standard full-doc assessment neatly. Alt-doc and low-doc routes exist, supported by an accountant's declaration, BAS lodgements and business bank statements. We work through your income situation upfront to identify the best approach.

Going direct means one lender's appetite and one set of criteria, and this is a sector where appetite is genuinely narrow. Some banks will not lend on a lot under 50 sqm at all, others decline anything in a hotel letting pool, and only a small group of lenders fund management rights properly. A specialist broker knows which lenders are actually writing strata accommodation this quarter, and how each one reads a caretaking agreement. Sending a fundable apartment to the wrong credit team is how it gets declined.

Yes, it is possible, and we arrange these. It is also one of the more intricate purchases in commercial finance, and the detail is what decides whether it works. The fund borrows under a limited recourse borrowing arrangement, so the apartment sits in a separate holding trust and the lender can only come after that one property. From 10 August 2026 a new arrangement can only be used for business real property: this is where it bites. The ATO treats a serviced apartment let through a management company, with earnings returned to the owner after fees, as not business real property. That is the standard letting-pool arrangement, so a fund generally will not be able to borrow to buy one under a new arrangement. Your operating company leases the apartment back from the fund, in writing, at market rent supported by an independent appraisal, and the rent has to actually be paid. Cross-collateralisation is not available inside super, so the fund needs its own deposit and the 100% LVR structures described elsewhere on this page do not work here. Lenders cap SMSF lending below a standard purchase, generally between 65% and 75%, and want cash left in the fund after settlement. We know this sounds complicated. It is, and that is exactly why we do it every day. Reach out to our team and we will guide you through the entire process. We structure the finance, tell you which lenders will take a strata lot as SMSF security and on what terms, and bring in the SMSF specialists and licensed advisers who set the fund side up. You will not be working it out on your own. Get that right and it is a solid, compliant structure.

Often, yes. A decline usually means the apartment went to a lender whose criteria did not fit the asset, not that the asset is unfundable. The three most common reasons are a lot under the minimum size, a hotel letting pool the bank will not accept, and a short remaining term on the caretaking agreement. Non-bank and specialist lenders assess all three differently. We will give you a straight answer on whether it is fundable elsewhere, and at what LVR.

Most of the time, no. We are paid a commission by the lender once your loan settles. Where a purchase requires significant preparation, a small mandate fee may apply, and we will always be upfront about this before work begins.

Although we are based in Sydney, we service clients across all major Australian cities, including Melbourne, Perth, Brisbane, the Gold Coast, Adelaide, Canberra and Hobart, along with their surrounding regional areas. Wherever your property is located, we can arrange your finance.

Although our main speciality is property loans for business owners, we also assist with apartment fit-out finance and working capital for serviced apartment operators. On asset finance, that covers apartment furnishing and FF&E packages, reception and booking technology, laundry and housekeeping equipment, and cleaning and grounds machinery. On working capital, we arrange business overdrafts, lines of credit and cash-flow funding to cover body corporate levies, seasonal occupancy troughs, refurbishment cycles and the timing of letting pool distributions.

Yes. That is our core ethos, helping you understand the right strategy, structure and clear advice from the very first conversation. Our main borrower profiles are short-stay operators, management rights buyers and accommodation investors seeking finance from $100,000 upwards, so a first commercial loan is well within our wheelhouse. We will walk you through the minimum size rules, the agreement term, the deposit you will genuinely need, and what the lender will ask for, before you commit to anything.