For many older Australians, wealth isn’t just tied up in the family home. Investment properties and holiday homes—often built up over decades—now represent a significant part of retirement planning.
A question we’re hearing more frequently is:
“Can I use a reverse mortgage on an investment property or holiday home?”
The short answer is yes, it’s possible—but there are important differences, conditions, and lender policies to understand. These types of properties are generally referred to as secondary properties, and reverse mortgages on them are becoming increasingly popular, particularly in a strong property market.
Why Interest in Secondary Property Reverse Mortgages Is Growing
In Australia, approximately 21% of all households own at least one residential property other than their primary residence. While a single percentage specifically for the over-55 demographic owning “more than one” property is not explicitly aggregated in a single 2026 figure, recent tax and census data highlights their dominance in the investment market:
- Age-Based Ownership Distribution: Australians aged 55 and over own nearly half (49%) of all investment properties in the country.
- Segmented Investment Rates: Specifically for those aged 55–64, approximately 25% of this age group own at least one investment property.
- Multiple Property Ownership: Among all property investors (of which the over-55s are the largest group), the distribution is as follows:
- 5% own exactly one investment property (meaning they own two properties total, including their home).
- 9% own two investment properties (three properties total).
- 6% own three or more investment properties.
Australia’s property market has delivered substantial long-term growth. Many seniors may own:
- A former family home now rented out
- A coastal or regional holiday house
- An investment property purchased years ago
Selling these properties may trigger capital gains tax, reduce long-term wealth, or remove a future income stream. As a result, more retirees are looking for ways to access equity without selling—and reverse mortgages are part of that conversation.
Using a reverse mortgage on a secondary property allows homeowners to unlock value while continuing to benefit from potential future capital growth.
What Is Considered a “Secondary Property”?
In reverse mortgage terms, a secondary property is typically any residential property that is not your primary place of residence, including:
- Investment properties (tenanted or vacant)
- Holiday homes
- Properties used part-time by the owner
- Properties rented on a long-term or short-term basis
These properties are assessed differently from owner-occupied homes, which is where policy variations come into play.
Is It Actually Possible to Reverse Mortgage a Secondary Property?
Yes—but not all lenders allow it, and those that do may apply stricter conditions.
Key points to understand:
- Eligibility criteria can differ significantly
- Loan-to-value ratios (LVRs) may be lower
- Interest rates may be higher than for a primary residence
- Property type and usage matter
This is why specialist guidance is essential before making assumptions about what’s possible.
What About Airbnb and Short-Term Rentals?
One of the most common follow-up questions relates to Airbnb and short-term accommodation.
The answer is: it depends on the lender and the property setup.
Some important considerations include:
1. Usage of the Property
Lenders often assess whether the property is:
- Permanently tenanted
- Occasionally rented
- Used primarily as a holiday home
- Used regularly for short-term stays
Short-term rentals like Airbnb can sometimes be seen as higher risk, which may result in additional conditions.
2. Income Assessment
While rental income is not always required for a reverse mortgage, lenders may still want clarity on:
- Whether income is consistent
- How the property is managed
- Whether usage could affect property value
3. Tenancy and Compliance
Properties used for Airbnb must comply with:
- Local council regulations
- State tenancy and short-stay rules
- Insurance requirements
Failure to meet these standards can affect lender approval.
Are Interest Rates Higher for Secondary Properties?
Often, yes.
Because secondary properties are not owner-occupied, some lenders apply:
- Higher interest rates
- Lower borrowing limits
- More conservative valuations
This doesn’t mean a reverse mortgage isn’t worthwhile—but it does mean comparisons and structure matter.
Why Lender Policy Differences Matter So Much
Unlike standard home loans, reverse mortgage policies vary widely from lender to lender. This is also on the question of secondary properties.
Differences in eligibility criteria may include:
- Whether secondary properties are accepted at all
- Maximum age-based borrowing limits
- How rental income is treated
- Whether Airbnb use is permitted
- Property location and type restrictions
Trying to navigate this without specialist knowledge can be frustrating—and costly.
The Importance of Using a Specialist Reverse Mortgage Broker
This is where working with a specialist like Seniors First becomes especially valuable.
A specialist broker:
- Understands which lenders accept secondary properties
- Knows how Airbnb and tenancy conditions are viewed
- Can compare policies across the market
- Structures loans to minimise long-term impact
- Explains risks clearly, without jargon
Most importantly, a specialist ensures the solution aligns with your retirement goals, not just what’s technically possible.
Is a Reverse Mortgage on a Secondary Property Right for You?
A reverse mortgage on an investment property or holiday home may suit seniors who want to:
- Avoid selling in a strong property market
- Preserve future capital gains
- Maintain rental income
- Reduce reliance on super or savings
- Fund lifestyle, healthcare, or family needs
However, it’s not a one-size-fits-all solution. Understanding the long-term implications is essential.
Final Thoughts
Reverse mortgages on secondary properties are growing in popularity, but they come with extra layers of complexity. Airbnb use, tenancy arrangements, and lender-specific rules all play a role in what’s available—and at what cost.
That’s why getting specialist advice upfront can make all the difference.
Ready to Explore Your Options?
If you own an investment property or holiday home and are curious about using its equity—without selling—Seniors First can help.
We specialise exclusively in reverse mortgages and later-life lending, providing clear, personalised guidance so you can make informed decisions with confidence.
👉 Book a no-obligation consultation with Seniors First today and discover whether a reverse mortgage on a secondary property could work for you.
Your property. Your future. Your choice.