Mixed Use Property Finance in Australia

A mixed use property is any building that combines commercial and residential components under one title, such as a shop on the ground floor with apartments above. The lender's classification depends on the ratio of commercial to residential floor area or income. If the commercial portion exceeds the lender's threshold (typically 30% to 50%), the entire loan is assessed under commercial lending policy.

Yes, but only if the residential component dominates and the property can be used primarily as a home. Some lenders will treat a property as residential if the commercial element is below 20% to 30% of floor area and the zoning allows residential conversion. Once the commercial share crosses the lender's threshold, the loan moves to commercial policy with a higher deposit and different rate structure.

Most borrowers need a deposit of 30% to 40% of the purchase price for a mixed use property. Because lenders typically apply commercial LVR limits (60% to 70%), the deposit requirement is larger than for a standard residential investment property. A stronger lease profile on the commercial component can sometimes support a lower deposit with the right lender.

Lenders assess the commercial and residential rental streams separately. Residential rent is typically shaded at 70% to 80% of gross rent for serviceability, similar to a standard investment loan. Commercial rent is assessed against the lease terms, tenant quality, and remaining lease term, and may be shaded more conservatively if the tenant is weak or the lease is short.

Mixed use property rates generally sit in the same range as standard commercial loans, typically 6.5% to 9.5% p.a. with major banks as at May 2026. The rate depends on LVR, the commercial-to-residential ratio, tenant strength, and the borrower's financial position. For a more detailed breakdown, see our guide to commercial property loan interest rates.

Yes, mixed use properties can be purchased through a Pty Ltd company, family trust, unit trust, or SMSF. Each entity structure has different lender requirements and documentation needs. Director guarantees are typically required for company and trust borrowers, and the entity structure can affect which lenders are willing to participate.

Valuers must assess both the commercial and residential components separately, then determine an overall market value for the combined asset. Comparable sales for mixed use properties are often limited because each building has a different commercial-to-residential split. This additional complexity typically adds one to two weeks to the valuation timeline compared to a single-use property.

If the commercial tenant leaves, the lender may reassess the facility at the next review because the income supporting the loan has reduced. This could lead to a margin increase, a request for additional security, or a reduction in the facility limit. Having a plan for re-leasing and the ability to service the loan from other income sources during the vacancy period helps protect your position.