Macquarie’s Guidelines Count 95% of Gross Rent and Apply a 15% Expense Floor Underneath. What Reaches Servicing Is Closer to 80%

There is a version of the investment lending conversation that happens hundreds of times a week in Australian broking, and it goes roughly like this. The client has a property returning $800 a week. They want to know what that does to their borrowing capacity. The broker does the arithmetic in their head, applies the shading figure they remember for that lender, and gives a number.

That number is almost always too high, and the reason is rarely the shading. It is the expense floor sitting underneath it.

Macquarie Bank’s broker credit guidelines were updated to Version 15.0 on 22 October 2026, and the rental income section is a clean illustration of why the quick answer so often misses. It also arrives in the same week as a change to how liabilities have to be recorded in ApplyOnline, which is the kind of unglamorous process amendment that quietly generates re-work across a whole book of applications.

What the guidelines actually say

Section 3D of the guidelines sets out the rental income treatment. For standard residential investment property, rental income is counted at 95% of gross rental income, in line with each borrower’s percentage ownership of the property. The guidelines describe that 95% as representing a 5% shading for vacancy.

That wording matters, because it closes off a common misreading. Brokers who see “95% of gross rent” and “a 5% vacancy shading” listed as separate line items in a policy summary sometimes apply both, and shade twice. They are the same cut expressed two ways.

The second cut is genuinely separate. The guidelines state that a floor of 15% of gross rental income will be applied to investment property expenses. It is a floor, not a fixed figure — where the actual, verified expenses on a property exceed 15% of gross rent, the higher number is the one in play. But 15% is the minimum the lender will assume, whatever the client says their outgoings are.

Stack the two and the arithmetic on a sole-owner property returning $800 a week looks like this. Gross annual rent of $41,600. Counted at 95%, that is $39,520. Deduct the expense floor at 15% of gross, or $6,240, and $33,280 reaches servicing. That is 80% of gross rent — a long way from the 95% headline, and $6,240 a year of assessed income different from the answer a broker gives if the expense floor slips their mind.

On a single property that gap is a rounding error in a conversation. Across a client with three investment properties, it is the difference between a pre-approval that holds and one that comes back short.

Not all rent is treated the same, either. The guidelines count short-term stays, room rentals and non-residential property — commercial, industrial and office — at 80% of gross, building in a 20% vacancy shading, with the same 15% expense floor applying. The guidelines also note that where an applicant relies heavily on non-residential rent, lease agreements should be obtained so the risk can be assessed. If your client has moved a property onto a short-stay platform since you last looked at the file, the income assumption underneath your servicing changes.

Two Macquarie documents, two sets of numbers

Here is where it gets more interesting, and where the practical instruction for the week sits.

Macquarie also publishes broker help pages explaining how to input income and liabilities into its serviceability calculator. Those pages set out a different set of figures. They say 75% of verified residential rental income is considered, with shading applied automatically in the calculator. They put investment property expenses at a minimum of 20% of verified rental income, always input at 20% for a new investment property, and at the actual figure for an existing property where actual expenses exceed 20%. Short-term stays, room rentals and non-residential property are described as considered at 65%, with a worked instruction to enter gross rental income multiplied by 0.65 and divided by 0.75.

Both documents are Macquarie’s own. The credit guidelines carry a version number and a last-updated date of 22 October 2026. The calculator guidance pages carry no published date at all, which makes it impossible to tell from the outside how they sit relative to the current pack.

That is a dull conclusion, and it is also the correct one. Capacity numbers given from memory are one of the quieter sources of client disappointment in broking — not because the broker was careless, but because lender policy moves faster than anyone’s recall of it, and because the same lender can describe the same treatment in two places in two different ways.

Overtime at 100%, but only for a defined list

The same guidelines pack sets out the overtime treatment, and it is worth knowing precisely because the generous figure is narrowly gated.

Overtime for occupations the guidelines classify as essential services is counted at 100%. Everything else is counted at 80%. Both require the overtime to be confirmed as regular, ongoing and evidenced.

The essential services definition is a closed list, not a judgement call. The guidelines limit it to occupations in named service categories, covering public transport, firefighting, health services, waste and sewerage services, corrections, police, and energy-sector technicians, with electricians excluded. Frontline aged care, frontline disability care and frontline aviation roles qualify. The guidelines carve out general support, cooking, cleaning, administration and baggage handling roles, which means two people employed by the same hospital or the same airport can sit on opposite sides of the line.

For a broker, the discipline is to read the occupation against the list rather than against the employer. A kitchen hand at a hospital is not a health services worker for this purpose, on the guidelines’ own wording. Getting that wrong in either direction — shading income that did not need shading, or assuming the full figure where the list excludes it — changes the capacity you present.

The liabilities change is the one that will cost you time

Broker Daily, in its lender policy round-up for 15 to 22 October published on 23 October, reports a further Macquarie change taking effect from 26 October: the liabilities section in ApplyOnline will require brokers to record, for each liability, whether it is partially cleared, fully cleared or unchanged. For partially cleared liabilities, the new limit and balance must be given. Where a liability is being cleared, the submission must state how — from loan funds, from sale proceeds, or from the customer’s own funds. All liabilities must be included.

This is a single-outlet report at the time of writing, so treat the detail as Broker Daily’s and confirm the specifics with Macquarie or your aggregator before you rebuild a process around it. But the shape of it is familiar, and the cost is predictable. Changes to mandatory fields in a lodgement platform do not reduce approvals; they generate requests for further information on files that were otherwise complete, because the information now has to be captured in a structured field rather than inferred from a supporting document or a note.

The brokerages that handle this well will not be the ones that read the notice. They will be the ones who update their own data collection before the lodgement, so the payout source for every liability being cleared is on file from the client conversation rather than chased afterwards.

It is worth noting the wider context too. The same round-up reports NAB introducing serviceability calculator Version 66 on 23 October, updating its household expenditure measure values, and describes the new calculator as mandatory for new home loan applications submitted after midnight AEDT that day. Two majors adjusting servicing inputs in the same week is a reasonable prompt to re-run any live pre-approval you are relying on.

Why capacity has become the competitive question

None of this would matter much if clients still chose a lender purely on rate. Increasingly they do not.

The Adviser reported in late September on Macquarie Equity Research’s 2026 Mortgage Broker Survey, which found that borrowing power was nominated by 84% of brokers as a factor customers seek from a lender — up 17% year on year and 26% since 2021. Best rates remained the top consideration at 93%, unchanged on the prior year, with time to improve cited by 81% and bank reputation by 43%. The same report noted APRA’s requirement that most residential mortgage borrowers be assessed with a serviceability buffer of three percentage points above the loan rate, which constrains maximum loan sizes and complicates refinancing.

Read those two things together and the commercial logic is plain. When the buffer is doing most of the work in limiting what a client can borrow, the lender-by-lender differences in how income is counted stop being technical trivia and become the thing that determines whether a deal is placeable at all. Rental income treatment is one of the largest of those differences on an investor file.

That is also why precision here is worth more than speed. A broker who can explain to an investor client why $800 a week of rent contributes roughly $33,280 rather than $41,600 to an assessment, and what that does to the number they can borrow, is demonstrating exactly the expertise that is driving brokers to a record share of new residential lending. A broker who gives a confident number from memory and revises it down a fortnight later is undermining it.

A note on file records

Australian mortgage brokers operate under a best interests duty under the National Consumer Credit Protection Act 2009, with ASIC’s guidance on that duty set out in Regulatory Guide 273. The detail of what your obligations require in any given situation is a matter for your licensee and, where needed, your own legal adviser — nothing here should be read as a statement of what the law requires on your files.

What can be said as a matter of practical craft is narrower. Where lender policy on a material input is genuinely ambiguous, and you resolve it by confirming with a BDM or by running the lender’s own calculator, the confirmation is worth recording on the file at the time you get it. Not because a rule here says so, but because a file that shows what you relied on and when is a far easier file to explain six months later than one that shows only the outcome.

What to review this week

The strategic point

Lender policy packs get read for the headline. A new alt-doc product, a rate move, a change to a maximum LVR — those are the items that travel. The settings that actually determine whether a file services are buried in sections like 3D, expressed as floors and shadings and apportionments, and they change without a press release.

The brokers who build an advantage out of this are not the ones who memorise more percentages. They are the ones who stop quoting from memory on anything material, who know which inputs on their panel are most likely to differ between a policy pack and a calculator, and who treat a confirmation from a BDM as part of the file rather than a conversation that happened.

On a Macquarie investor file this week, the practical version of that is simple enough. The lease says $800. The guidelines say 95%. The floor says 15%. The number you give your client should come from the calculator.