Using your home equity in retirement: an Eastern Suburbs guide
Retired Eastern Suburbs homeowners have seven main ways to use home equity: stay as is, refinance, the Government's Home Equity Access Scheme, a reverse mortgage, downsizing, renting part of the home, or family help. Each affects tax, pension and estate differently, so compare them in writing, with family, before committing.
Written by James Chee CPA, Credit Representative 517980 of Global Mutual Funds Pty Ltd (ACL 222640), FBAA member·Reviewed by Graham Chee FCPA·Last reviewed
Seven ways to use your home equity
No option suits everyone. The right mix depends on your income, health, family plans and what you want to leave behind.
| Option | Pros | Risks | Who to talk to |
|---|---|---|---|
| Stay as is | No new debt, no costs and no change to your home or estate plans. | Cash flow may stay tight, and repairs or care costs can arrive later with fewer choices. | Your accountant, and a licensed financial adviser for super and Centrelink questions. |
| Refinance | Can reduce an existing loan’s cost or release some equity with a standard home loan. | You must show you can make repayments from retirement income, and lenders’ age and term rules apply. | A mortgage broker (credit representative) to compare lenders. |
| Home Equity Access Scheme | A Government loan paid fortnightly or as limited lump sums, secured against Australian real estate you own. | Interest compounds and the debt grows. Voluntary repayments are allowed; otherwise it is repaid when you sell, move into care or pass away. | Services Australia, plus a licensed financial adviser for pension effects. |
| Reverse mortgage | Lump sum, regular income or a line of credit while you stay at home. No regular repayments: the loan is repaid when you sell, move into care or pass away. | Compound interest can use up a large share of your equity and reduce what you leave to family. Fees apply and pension entitlements can change. | A mortgage broker (credit representative), a solicitor for independent legal advice, and a licensed financial adviser. |
| Downsize | Frees capital, can reduce upkeep, and eligible people may make a downsizer contribution to super. | Stamp duty, agent and moving costs, leaving your community, and possible Age Pension assets test changes. | Your accountant, a licensed financial adviser and a local real estate agent. |
| Rent part of the home | Extra income without selling or borrowing, and company or help around the house. | Rent is taxable income, part of the main residence capital gains exemption can be lost, and it affects privacy and insurance. | Your accountant for tax and capital gains, and a solicitor for the agreement. |
| Family help | Family can contribute, buy in or lend on agreed terms, keeping the home in the family. | Disputes, gift and granny flat rules for Centrelink, and estate or stamp duty issues if it isn’t documented. | A solicitor, your accountant, and a licensed financial adviser for Centrelink effects. |
No interest rates or lenders are quoted on this page. Costs, eligibility and lender criteria vary.
Questions answered
- Home Equity Access Scheme vs reverse mortgage: which suits you?
Eligibility, interest, lump-sum limits, negative equity protection and who you apply through, side by side.
- Can I lose my home or owe more than it’s worth with a reverse mortgage?
Statutory negative equity protection, what it doesn’t cover, and the projections and information statement lenders must give you.
- Paying a RAD for aged care: sell, rent or borrow against the family home?
Selling, renting or borrowing against the home to fund a RAD, from a credit and tax angle, with main residence CGT points.
Not sure which option fits your goal? Try the home equity options explorer.
Why an accountant and broker together
Most home equity decisions are part lending and part tax. A broker can compare loan products, but renting a room, selling or helping family can change your capital gains position, taxable income and estate. Having the accounting side looked at in the same conversation means the loan question isn't answered in isolation.
Our accounting practice, Local Knowledge accountants (localknowledge.au), covers tax returns, capital gains and estate-related tax questions, while lending options are handled here.
Official tools and information
- ASIC Moneysmart reverse mortgage calculator
See how a reverse mortgage balance can grow over time and what it may leave in your home.
- Services Australia: Home Equity Access Scheme
Eligibility, payment options and how the Government loan is repaid.
- ATO: downsizer super contributions
Age, ownership and timing rules for adding sale proceeds to super.
- My Aged Care
Government entry point for home care and residential aged care, including fees.
Home equity in retirement FAQs
General information only. It does not take your objectives, financial situation or needs into account and is not financial product, tax or legal advice. Lending criteria, fees and charges apply. Super, Centrelink and aged-care fee advice is referred to a licensed financial adviser.
See all seven options compared for your home
A 60-minute Home Equity Options Review, family welcome, with a written comparison you can take away and think over.