New loan helping high-income Australians buy property sooner
A new fintech-backed product called Deposit Pro, launched by Australian firm Reaia, is offering buyers earning $250,000 or couples on $400,000-plus a way into $2m-$5m properties, without the usual decade-long wait to save a 20 per cent deposit.
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It's a bold pitch for a growing class of income-rich, asset-poor professionals who are paying $50,000 to $80,000 a year in rent, while house prices continue to outpace their savings.
Reaia co-chief executive Neil Smoli said that while many still viewed homeownership as a milestone that could be reached by 'just saving harder', the economic reality had changed, even for those on top salaries.
'It's absolutely the new normal,' Mr Smoli said.
'Unless you've got the Bank of Mum and Dad or inheritance behind you, the deposit gap is almost impossible to bridge.
'We've had clients earning $500,000 a year who still can't buy close to work because they're stuck renting and repaying HECS.'
Mr Smoli said the problem was magnified by the limitations of lenders mortgage insurance (LMI), which typically disappears once a property's value exceeds $2m, or becomes prohibitively expensive.
'LMI drops off completely once you hit the $2.5m to $3m mark.
'And if it is available, your allowable loan-to-value ratio falls. Suddenly that 10 per cent deposit still takes a decade to save.'
Instead of offering insurance against a low deposit, Deposit Pro provides a stand-alone deposit loan to help qualified buyers purchase earlier, while still managing their mortgage repayments through traditional lenders.
'It's structured for people who can clearly afford the repayments, but just can't out-save the market,' Mr Smoli said.
'They've done everything right, and yet they're locked out.'
M R Advocacy director and co-founder of Scale Lending Mortgage brokers said she'd seen demand rising sharply from high-income professionals unable to pull together a large enough deposit fast enough.
'If something like this exists and they've got the serviceability, I'd tell them to take it with both hands,' Ms Roberts said.
'The traditional deposit system is broken, even people earning $300,000 are still renting because they just can't keep up with cost of living and savings expectations.'
Ms Roberts said Deposit Pro wouldn't suit everyone, and clients should always compare it to LMI or consider rentvesting in more affordable areas, but agreed it offered a practical solution.
'At least it doesn't involve the government owning half your home,' she said.
'We need more alternatives that don't rely on luck or inheritance.'
Arin Russell Property director and buyers agent Arin Russell said that while most of his clients were buying under $1m, he believed a product like Deposit Pro filled an important gap for time-poor, ambition-rich buyers in prestige markets.
'There's definitely a stigma around LMI,' Mr Russell said.
'So if you've got a genuine alternative that's better tailored for high-end buyers, I think a lot of people would jump on that.'
Mr Russell said younger buyers, especially in the Generation Z and Millennial cohorts, were desperate to find ways to 'hack' the system and enter the market sooner.
'For younger clients, my advice is always the same, get in as soon as you can,' he said.
'Don't wait around for the perfect conditions. Set your goals, optimise your income, and take the opportunity if it makes sense.'
According to Reaia's internal research, there are more than 100,000 Australians earning high incomes but renting long-term because of deposit barriers.
Mr Smoli said the national savings rate — recently as low as 1.2 per cent — was nowhere near enough to keep pace with rising home values.
'This is about offering a genuine path forward for people who've done everything right, got the grades, studied hard, built their careers — and still can't get in,' Mr Smoli said.
'If we keep locking out an entire generation of high earners from homeownership, the social and financial implications will be massive.'
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ABC News
23 minutes ago
- ABC News
WA's RAC electric-highway charging project ends despite rise in EVs
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News.com.au
35 minutes ago
- News.com.au
‘We should be worried': From peanuts to paper, Australia's manufacturing industry is in crisis
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Administrators KordaMentha revealed in March the steelworks was losing $1.5 million a day, totalling $319 million in the seven months to January, before its collapse leaving $1.34 billion in debts. A sale process is currently underway, with reports BlueScope has been granted a rare right-of-last refusal in the deal. BlueScope, the country's largest steelmaker, was last year handed nearly $140 million by the federal government to upgrade its Port Kembla plant, as part of a $200 million rescue package that included $63 million for Whyalla. In 2017, a parliamentary inquiry into the future of Australia's steel industry warned that rising power prices were affecting the viability of steel and other energy-intensive industries. 'The committee is concerned that without remedial measures and a tenable bipartisan plan to reduce energy costs, the future of the Australian steel industry remains in doubt,' the report said. 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ABC News
2 hours ago
- ABC News
'Enrolment crisis' for performing arts students at Virtual School Victoria
Amid surging enrolments a state-run virtual school is tightening its entry criteria, making it effectively impossible for talented performers to be accepted into the school. Many singers, actors and dancers who are attending private performing arts colleges get their high-school education from Virtual School Victoria (VSV), formerly called Distance Education Centre Victoria. The industry peak body, Ausdance VIC, has told the ABC if change comes into effect at VSV next year, the academic future of over 100 high-school students could be in doubt. From 2026, performance students enrolling in VSV require support from specific creative organisations. The problem, according to Ausdance VIC, is the listed companies cannot provide references. "None of the organisations on that list knew they were going to be required to give these references," Ausdance VIC spokesperson Eilannin Harris-Black said. "Accordingly they've got no policies in place, and they are just generally unable to provide these [references] through lack of remit, lack of insurance, lack of procedures and no communication at all from the Department of Education. Since April, Ausdance VIC has been trying to negotiate with VSV and the Department of Education to find a way forward. It is calling on VSV to "urgently suspend" the new criteria until a workable solution has been found in consultation with the sector. Only students re-enrolling for years 11 and 12 can apply under the existing requirements. "The dance sector is happy to participate in proper checks and balances — but there needs to be consultation before action." The Department of Education said the enrolment criteria had been strengthened to ensure the category remained focused on elite students. A spokesperson said the changes were to "ensure alignment with the category's original intent — to support elite athletes and performers with extraordinary commitments, and to support students to engage meaningfully in their education and meet minimum instructional hours." "VSV is supporting students and their parents to explore alternative educational options if they are no longer eligible to attend VSV and can give special consideration on a case-by-case basis". Following questions from the ABC and stakeholders, the ABC understands the Department was reviewing VSV enrolment requirements for 2026 and will update the school community in term 3. VSV was contacted for comment. Transit Dance trains around 30 high school students annually. The school's artistic director and Ausdance board member, Jayden Hicks, said if the proposed criteria goes ahead in 2026, it would create an "enrolment crisis". "Anyone below year 10 couldn't continue and we couldn't accept new students, even if they were exceptional." He wants VSV and the Department of Education to see how performance arts high schools operate before making any changes. "We have classroom set-ups, we have high school teachers — we are a great alternative to mainstream school for creative students," he said. Mr Hicks said he was happy for independent oversight of incoming students, but the current list of "recognised organisations" was unworkable. "Our governance body is Ausdance, they should be able to assess if students are elite or advise on who would be an appropriate referee." Imogen Premraj knew she wanted a career in musical theatre from the moment she saw MAMMA MIA! on stage as a three-year-old. Now 14, Imogen has already performed professionally with the Melbourne Theatre Company, and at Melbourne's Regent Theatre. When she was accepted into the Ministry of Performing Arts College (MOPAC) for year 8, she was elated. "The community at MOPAC is amazing and my skills have definitely improved," she said. "I think my academic performance is going really well with VSV." Imogen's mother, Bridie Premraj, said the planned enrolment changes for 2026 "don't make sense". She hoped performance students, including her daughter, could continue with the virtual school. "Having access to VSV means communities like MOPAC can exist, accessing really high-quality [performance] training while also accessing high quality education," Ms Premraj said. "Since starting at MOPAC we have seen a huge growth in her confidence and skills, far beyond what we would have imagined. "It would be disappointing if Imogen couldn't continue with VSV." VSV describes itself as "the state's leading virtual school". In recent years enrolments at VSV have exploded — from 3,530 students in 2018 to 6,673 in 2025. Most pupils are school-based students completing VCE subjects not offered at their home school. Others attend VSV full time because they cannot attend a mainstream school due to elite sports or performing arts commitments, mental or physical health conditions, travel, or living remotely. Of the non-school based students, it appears most of the enrolments come from the medical "mental health" category, which was previously named "social emotional". VSV's 2022 annual report said there were "1,431 students enrolled in this category including 895 students referred to the school by medical practitioners due to school refusal". Some people questioned whether the change in criteria for the sports/performance category was an effort to reduce enrolments and push students back into mainstream schools. This was despite the sports/performance category accounting for just three per cent of VSV's total enrolments in 2025. VSV and the Department of Education didn't respond when the ABC asked if the new criteria are designed to reduce enrolments. In October 2024, VSV announced an update to the sports/performance enrolment category to "clarify and standardise the requirements for elite athletes and performers seeking enrolment at VSV". Previously students were required to get a letter from their current school stating the student had left for performing arts commitments and that "in their view, VSV is an appropriate alternative educational experience". The students sporting or performing arts organisation was then required to confirm: New criteria means that from 2026 only Victorian residents entering years 9-12 with exceptional abilities will be eligible. Applicants will also require support from a recognised sports or performing arts organisation. The problem for these performing arts schools is that even if students are "exceptional" the artistic companies listed are not in a position to provide references, according to Ausdance VIC. The ABC has contacted several of the listed organisations — those that responded said they were not notified of the change and could not provide the detailed endorsement asked for in the guidelines.
