The Defence Home Ownership Assistance Scheme (DHOAS) was created to provide current and former Permanent Australian Defence Force and Reserves members with a monthly subsidy toward their home loan interest. It’s open to eligible members and encourages home ownership and long-term service.
The eligibility criteria include active service within the last five years and qualifying service. A financial advisor can help navigate the necessary paperwork to secure a defence home loan, and it’s also possible to apply for a construction or multi-party loan. However, these come with additional conditions. It’s the defence force member’s responsibility to ensure they comply with the eligibility criteria, but working with a financial advisor helps ensure the correct steps are taken.
The benefits include agreeable interest rates, government subsidies, relocation flexibility, deployment considerations, low loan-to-value ratio, prepayment freedom, exclusive support, loan portability, insurance benefits, and construction loans.
What does that mean for property investors and financial planners?
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Property Opportunities
The property market has shifted in recent years, and while the country is recovering positively from the early 2020s, there are still labour shortages and material costs to consider. Ultimately, these shifts have resulted in higher property prices, and that makes homeownership an even greater challenge for many people. That doesn’t mean there aren’t opportunities, whether you’re looking to invest or expand your portfolio.
You won’t receive a defence home loan subsidy payment until you’ve lived in the property for 12 months, and you can only receive the payment for one home at a time. That doesn’t mean you can’t apply for a new subsidy if you pay off and purchase a new home. However, it does make matters more complicated.
The market, as it stands, is about finding the right location to ensure value for your money. While rental yields are expected to remain strong, you should look at vacancy rates in the area where you’re thinking about buying.
With defence home loans and other government incentives available, more first-home buyers are on the market and that’s direct competition to property investors who are looking to find the right investment property. That being said, there are government incentives for property investors as well, it’s about finding the right financial advisor to guide you.
ADF first-home buyers and property investors should fully explore options like stamp duty concessions, housing grants, and tax benefits to reduce the upfront costs of purchasing a home and improve their investment options and outcomes. Working with an experienced financial advisor will give you a clear view of all the information you need to make the best decisions around your investments. Knowing your entitlements as an ADF member is key.
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Invest Wisely
While the cash rate was reduced in early 2025, the banks haven’t followed suit in reducing interest rates. However, all the experts seem to agree that we’re entering a period of stability. The key to solid investment decisions is acting when you’re ready rather than reacting to interest rate changes. If you’re ready to invest now, you should be ready to invest now, not because the market turns more favourable.
While investors may like the high-demand areas, it’s worth looking at smaller cities or emerging markets in regional areas. There are plenty of growth areas with great property prices that offer growth. People are embracing more rural living, and they’re shifting toward beach towns and walkable cities, so investing in these areas is a win. Research is key, but if you’re still unsure, it’s worth consulting a broker or advisor for better guidance.
Every investment comes with an element of risk, but as long as you’re aware of the potential risks and have a mitigation plan in place, you’re as ready as you can be to move forward as a property investor. If you plan to invest in renting your property out, you need to know tenancy laws and prospective changes. States are looking at legislation regarding tenant rights and capping rent increases. If you can handle that, you’re ready to invest no matter who is competing in the market.
Ultimately, getting to grips with your financial position is the key to being ready to act when the opportunity presents itself. Know what you need to qualify for the relevant loans, have the deposit lined up, and be ready to act quickly. If you have established a solid financial foundation and an investment plan in place, you shouldn’t face too many issues.
