Commercial Property Loan Deposit: How Much You Need in 2026
Commercial Property Loan Deposit | Switchboard Finance
Property Lending
Deposit tiers · Stamp duty by state · Cash to complete
Commercial Property Loan Deposit: How Much You Need in 2026
The deposit on a commercial purchase is set by the tier your deal sits in, not by a single national rule. This page maps the tiers, prices the costs that sit on top, and sets out how stamp duty on commercial property differs across every state and territory.
Quick Answer
How much deposit you need for a commercial property is set by the tier your deal sits in, not by one market rule. Security type and documentation path fix the lending ceiling, and the deposit fills the gap above it plus transaction costs. See commercial property loans.
How much deposit do you need for a commercial property loan?
Enough to cover the gap between the price and what the lender will advance, plus the costs that sit on top. Lenders assess the property, apply a loan to value ratio ceiling to their assessed value and advance up to that limit. Everything above the advance is yours to find. On standard security with a full financials path, the conversation commonly starts near 20 to 30 per cent of the price plus costs, indicative and varies by lender.
The number is not set by the market as a whole. It is set by the tier your deal sits in, and the tier is a function of two things: what the security is, and how you evidence the income. Get the tier right and the deposit follows. Chase a lower deposit inside the wrong tier and you burn weeks.
Commercial property is a substantial and growing book for Australian lenders. Authorised deposit-taking institutions held approximately $487.6 billion in commercial property exposures in the March 2026 quarter, against approved limits of $525.8 billion, up 8.7 per cent on a year earlier. Source: APRA quarterly authorised deposit-taking institution property exposure statistics, March 2026 quarter, read 23 August 2026. That is a measure of system appetite, not of the ceiling any one file will be offered, and it is not a forecast of what you will be approved for.
The deposit by tier: security and documentation set the floor
This is the comparison the scattered blog posts never put in one place. Ranking pages give a single national percentage. In practice the deposit moves through a ladder of tiers, and knowing which rung you are on is worth more than any headline number.
Indicative bands only. Drawn from Switchboard Finance broking experience as at August 2026, not a quote and not an offer. Actual ceilings and deposits vary by lender, security type, lease strength and the file in front of the credit desk.
Two of those tiers are worth reading in full before you budget. Lease doc commercial property loans explains what a lender wants to see when the rent is doing the heavy lifting, and how lenders value a specialised commercial property explains why a purpose-built asset carries a lower ceiling and therefore a bigger deposit.
What is the minimum deposit for a commercial property?
There is no market-wide minimum, only a tier floor. On standard security with full financials the practical floor commonly sits around 20 to 30 per cent plus costs, indicative and varies by lender. Below that you are not negotiating a better deal, you are changing tiers, and that means changing either the security or the evidence.
One thing catches buyers out repeatedly. The deposit is calculated against the lender's valuation, not the contract price. If those two numbers diverge, the deposit moves and the price does not. Ordering the valuation early is the cheapest way to remove that uncertainty, and what a commercial valuation actually tests is worth reading before you sign.
Why commercial deposits are bigger than home loan deposits
Three structural reasons, none of which are negotiable at the individual file level.
Commercial LVR ceilings are lower. Commercial property takes longer to sell and its value depends heavily on the lease and the tenant, so lenders hold more of the risk buffer themselves. Lenders mortgage insurance is generally unavailable on commercial security, so the mechanism that lets a home buyer settle on a small deposit simply does not exist here. And the valuation method is different: commercial value is driven substantially by the income the property produces, not by comparable sales alone.
Which asset you offer as security changes all three at once. Residential security or commercial security on a purchase sets out how that choice moves the ceiling, the valuation basis and your freedom to sell later.
The costs that sit on top of the deposit
Cash to complete is the number that decides whether you settle, and it is always larger than the deposit. On top of the deposit sit stamp duty, GST where it applies, valuation and legal fees, and lender establishment costs.
Stamp duty is the item that most national guides get wrong, because they quote one figure as though the country had one rule. It does not. Commercial property duty differs so sharply between jurisdictions that the same purchase price can produce nil duty in one state and close to fifty thousand dollars in another.
How to read that table. The dollar figures are calculated from each revenue office's published rate as read on 23 August 2026 on a $1,000,000 dutiable value with no concession, and they are indicative only. New South Wales applies $11,602 plus $4.50 for every $100 over $387,000 (Revenue NSW, page updated 19 August 2026). Queensland applies $17,325 plus $4.50 for every $100 over $540,000 (Duties Act 2001 schedule 3, and the Queensland Revenue Office rates). Western Australia applies $28,453 plus $5.15 for every $100 above $725,000 (WA Department of Treasury and Finance, page updated 30 July 2026). Tasmania applies $27,810 plus $4.50 for every $100 above $725,000 (State Revenue Office Tasmania rates of duty). The Northern Territory applies 4.95 per cent of the dutiable amount between $525,000 and $3 million (Territory Revenue Office). South Australia has charged no duty on qualifying land, meaning non-residential and non-primary-production land, since 1 July 2018 (RevenueSA). The ACT charges no duty on commercial transactions valued up to $2,100,000 from 1 July 2026, and a flat $5.00 per $100 of the total value above it (ACT Revenue Office, page updated 9 July 2026).
Victoria is deliberately not given a dollar figure. Commercial and industrial property in Victoria now runs through the commercial and industrial property tax reform: the first sale after the property enters the reform is an entry transaction that pays land transfer duty once, with a government transition loan available to spread it, and after a ten year transition the property moves to an annual commercial and industrial property tax set at one per cent of unimproved site value. That changes what you budget at settlement and what you budget every year afterwards, so it should be priced with your accountant against the current State Revenue Office position on commercial and industrial property tax rather than from a rate table. Confirm every one of these figures with the relevant revenue office before you commit. Duty settings move with each state budget cycle, this is general information only and it is not tax advice.
From our broking, indicative
What we actually see on files we place, rather than what a rate table implies.
- Cash to complete on a $1,000,000 owner occupier warehouse purchase typically lands around $320,000 to $380,000 all in, being a 25 to 30 per cent deposit plus duty and costs. Basis: recent files, Victorian example, as at August 2026.
- Equity-backed files have settled with under $50,000 of cash contributed, where equity in a residential property covered the gap and the combined position serviced. Basis: recent files, as at August 2026.
Indicative only, based on deals we have placed, not a quote and not an offer. Actual terms depend on lender policy, the security, the valuation and your circumstances at the time of application. General information only, not financial advice.
GST on a commercial purchase: going concern, taxable sale or margin scheme
GST is the cost most likely to move your cash to complete by a six figure amount, and it turns on how the contract is structured rather than on what the property is. There are three common treatments.
A GST-free supply of a going concern. The Australian Taxation Office treats a sale as a GST-free going concern where the sale is for payment, the purchaser is registered or required to be registered for GST, the purchaser and seller have agreed in writing that the sale is of a going concern, and the seller supplies everything necessary for the continued operation of the business and carries it on until the day of sale. Source: ATO, Selling a going concern, page updated 15 December 2022, read 23 August 2026. A taxable supply, where GST is charged on the full price and a registered buyer may claim it back, which still means funding it between settlement and the refund. The margin scheme, where, subject to eligibility, GST is worked out on the margin rather than on the full sale price. Source: ATO, GST and the margin scheme, read 23 August 2026.
Whether any of these apply to your contract is a question for your accountant or solicitor, not for a lender or a broker. What matters for the deposit conversation is that the treatment is settled early, because it changes the cash you need on the day.
If the valuation comes in under the contract price
A short valuation does not reduce the price, it reduces the advance, and the whole difference lands on you as extra cash. The arithmetic is unforgiving because you lose the shortfall and the lender's share of it at the same time. On a $1,000,000 purchase at a 70 per cent ceiling, a five per cent shortfall takes the advance from $700,000 to $665,000 and adds $35,000 to the cash you need. A ten per cent shortfall adds $70,000. That is illustrative arithmetic on the tier bands above, not a prediction of any particular file.
What happens next, and which levers are still available once the number comes back, is covered in full in valuation came in under the contract price, what happens next. When a commercial valuation comes in under your contract price walks through the same situation from the deal side.
Buying commercial property inside an SMSF
An SMSF buying commercial property under a limited recourse borrowing arrangement generally needs a larger deposit than a trading entity would, because lenders apply lower ceilings to fund borrowing and there is no recourse beyond the asset itself.
The eligibility question now comes before the deposit question. From 10 August 2026, a new limited recourse borrowing arrangement can only be used to acquire real property where the property is business real property. Arrangements entered into before that date, refinances of them, and binding contracts to acquire real property exchanged before that date are not affected. Source: ATO, Changes to LRBAs for property from 10 August, page updated 29 July 2026, read 23 August 2026, implementing the Treasury Laws Amendment (Tax Reform No. 1) Act 2026.
SMSF structuring is licensed advice and this page does not give it. Speak to your SMSF adviser and your accountant about whether the property qualifies, then come to the deposit and lender question. We can help with the finance side through commercial property loans once the fund's position is confirmed.
How to fund the deposit without all the cash
The deposit does not have to arrive as savings. Equity you already hold can stand in for it, and this is the lane where a broker earns their keep, because the structure decides whether the file works at all.
What makes an equity substitution work
- The equity is real after a current valuation, not a hoped-for value
- Combined debt across both properties services from provable income
- There is a sensible exit, whether that is sale, refinance or amortisation
- The additional security is acceptable to the same lender or is structured to avoid a clash
- Tax position is clean, because unresolved arrears shrink the lender pool
What sinks it
- Equity that only exists at the old valuation
- Servicing that works on the new loan but fails across the combined position
- Cross-collateralisation entered without understanding the release conditions
- A second mortgage the first mortgagee will not consent to
- No exit, so the structure has no way to unwind
There are two common routes. Offering an existing property as additional security, where the lender reads the combined position and advances more against the pair. Or raising cash first through equity release and refinance, or through a second mortgage registered behind the existing loan, so that the cash is in hand as a deposit before you buy. Which one fits depends on the first mortgagee, the timing and what you want to be able to sell later. Talk it through against the property lending hub before you commit to a structure.
The commercial property deposit is not one number, it is a tier. Security type and documentation path set the lending ceiling, the ceiling sets the deposit, and the costs on top decide what you actually need in the account on settlement day. Those costs are where the national guides fail you: duty on commercial property ranges from nil in South Australia and below the ACT threshold, through a reform-based entry transaction in Victoria, to a flat percentage in the Northern Territory. Work out your tier, then price your jurisdiction, then talk to a lender.
Key takeaway: change the tier, not the negotiation, if you want the deposit to move.Frequently Asked Questions
The deposit on a commercial property is the gap between the purchase price plus costs and what the lender will advance against the security. On standard security with a full financials path it commonly starts around 20 to 30 per cent of the price plus costs, indicative and varies by lender. The lender sets its advance from its own valuation, so the deposit is measured against the valuation, not the contract price. How commercial property loans work sets out the mechanics behind that advance.
There is no single national minimum for commercial real estate. The floor is set by your tier: standard security with full financials commonly starts near 20 to 30 per cent plus costs, lease doc and low doc paths generally push it to 25 to 35 per cent plus costs, and specialised security sits higher again, all indicative and varying by lender. Work out which tier your deal sits in before you chase a lower number, and see commercial property loans for the paths we place.
On a $500,000 commercial property with standard security and full financials, the deposit conversation commonly starts around $100,000 to $150,000 plus costs, indicative and varying by lender. Stamp duty, legals and valuation fees sit on top of that and differ by state, so the cash you actually need at settlement is materially more than the deposit alone. Deposit and cash at settlement walks through the same arithmetic on an industrial unit.
Yes, equity in a property you already own can stand in for a cash deposit, either by offering that property as additional security or by raising cash against it first. The lender reads the combined position across both properties, so the equity has to be real after a current valuation and the combined debt has to service from provable income. Equity release and refinance covers the ways that equity is released.
What you can borrow is the lender's LVR ceiling applied to its assessed value of the property, provided the income services the repayments. On standard security with full financials those ceilings commonly sit around 70 to 80 per cent of value, indicative and varying by lender, and they fall as the security gets more specialised. How lenders value a specialised commercial property explains why the ceiling moves.
Generally no. Lenders mortgage insurance, which lets home buyers settle with a small deposit, is not typically available on commercial security. That is one of the main reasons the commercial deposit is larger than a home loan deposit, and why the gap has to be filled with cash or with equity in another property. Talk to a commercial property lender about which structure fits.
They add to the cash you need at settlement, which is the number that actually matters. Stamp duty follows the rules of the state or territory the property sits in and those rules differ sharply, from no duty at all on qualifying commercial land in South Australia through to a flat percentage in the Northern Territory. Whether GST applies to your contract depends on how the sale is structured and is a matter for your accountant or solicitor.
Yes, and the differences are large enough to change your cash to complete. South Australia charges no duty on qualifying non-residential land, the ACT charges no duty on commercial transactions below its threshold, Victoria runs commercial and industrial property through a reform that replaces ongoing duty with an annual tax, and the remaining states apply general ad valorem transfer duty. Always confirm the current figure with the relevant revenue office before you budget.
An SMSF buying commercial property under a limited recourse borrowing arrangement generally needs a larger deposit than a trading entity would, because lenders apply lower LVR ceilings to fund borrowing. From 10 August 2026 a new limited recourse borrowing arrangement can only be used to acquire real property that is business real property, so the property itself has to qualify before the deposit question arises. This is a licensed advice area, so speak to your SMSF adviser and accountant first.
A low valuation does not change the price, it changes how much the lender will advance, so the shortfall lands on you as extra cash. Because the lender advances a percentage of the lower of valuation and price, a shortfall costs you the full gap plus the lender's share of it. Valuation came in under the contract price sets out what happens next and the levers that are still available.
FBAA Accredited
From the Switchboard Desk
Updated August 2026The latest from our brokers, and the hubs where these guides live.
- What a Commercial Valuation Actually TestsHow valuers test income durability to set a lendable value
- Buying Your Premises From Your Landlord: How the Purchase RunsLease terms, an unadvertised price and the landlord's timetable
- Development Finance for Two to Six TownhousesHard cost, TDC or GRV decides what you fund yourself
- Buying a Warehouse or Industrial Unit: Deposit and Cash at SettlementCash needed on the day, deposit through duty and GST
- When a Commercial Valuation Comes In Under Your Contract PriceWhat the shortfall means, and levers to keep the deal moving
- Residential Security or Commercial Security on a PurchaseWhich asset carries the mortgage changes the ceiling and the valuation basis
- The 60 Days Before Your Overdraft Facility ReviewThe window to change the review outcome opens two months out
- What Twelve Months of Bank Statements Tell an Overdraft LenderHow an assessor reads your working capital cycle from statements
