The landscape is shifting. Within the dense regulatory text of APRA’s announcements lies a critical exemption that provides a strategic lifeline for the industry. For brokers, understanding this exemption is the most powerful "pivot" tool available in 2026.
In This Briefing
The Hidden Exemption
APRA has explicitly exempted loans for the construction of new dwellings and the purchase of newly erected dwellings from strict DTI (Debt-to-Income) limits.
This policy design is intentional, aiming to curb systemic risk related to asset price inflation of existing stock without stifling the supply of new housing—a politically sensitive topic given the ongoing national housing shortage.
Why This Matters
An investor capped at 5.5x DTI for an existing terrace house in Sydney might still be eligible for 7x DTI for a house-and-land package in a growth corridor, simply because the latter does not count toward the bank’s restricted quota.
The Opportunity: By The Numbers
Use the simulator below to visualize the borrowing power gap for your clients.
Borrowing Power Simulator
Includes credit cards, HECS, auto loans.
The "Pivot" Strategy
Instead of delivering a "no" to a high-leverage client, brokers can deliver a "yes, but..."—pivoting the asset selection toward new stock.
Diagnose the Blockage
If the DTI calculation exceeds 6.0x on an established property, the application will likely trigger a system decline or high-risk referral.
Propose the Pivot
Present construction options. House-and-land packages or off-the-plan apartments utilize the DTI exemption.
"While the banks have tightened lending on existing homes in this price bracket, your income profile is actually perfect for a new build strategy. We can secure the leverage you need if we look at growth corridors..."
Operational Execution
Ensure the Loan Purpose Code is correctly flagged as "Construction" or "Newly Erected" in the submission platform to bypass the DTI filter.
Risk Education & Mitigation
While the leverage is available, construction carries completion risk. Brokers must educate clients to ensure the "tax tail doesn't wag the investment dog."
Critical Checklist
- Fixed Price Contracts: Scrutinize "rise and fall" clauses.
- Builder Solvency: Verify builder insurance and track record.
- Valuation Buffers: Ensure clients have a buffer for low on-completion valuations.
Strategic Alliances
Now is the time for brokers to forge referral relationships with reputable builders. They will be the primary beneficiaries of this regulatory arbitrage, and they need finance-savvy brokers to qualify their buyers.