How will Centrelink assess my investment property?

A reader who has an investment property with a mortgage wants to know how Centrelink will assess the property.


Q. Noel

How does an investment property that has a mortgage affect your Centrelink pension?

A. An investment property is considered an asset under the Age Pension assets test, but Centrelink will only assess the portion of the property you own.

To do this, Centrelink takes away the loan amount you owe for the property from your share of the total value.

Sounds simple, right?

However, there are some other issues to consider, not the least Australia’s booming housing market.

To match the ever-escalating value of housing in Australia, Centrelink will index the value of your property on the same date each year.

If Centrelink can’t index a property, it will organise to have it valued.

If the new valuation affects your payment, Centrelink will let you know. Normally, you won’t have to pay anything back. But you will need to pay Centrelink back if you have been paid too much because you didn’t tell them about any significant upgrades that have increased the value of the property or bought any new real estate.

Centrelink will also check land title records to confirm what real estate you own. If these records don’t match what you have told Centrelink, they will contact you.

If the value of your real estate is more than what you’ve declared, any payments you receive through Centrelink may reduce or stop and you may need to pay back money.

If you disagree with the indexation or valuation you can appeal the decision.

It’s also worth noting that any rent you receive from the property will also be included in the Age Pension income test.

Your assessable income from real estate is the gross income you get from it, minus the deductions Centrelink allows

You can claim loan interest payments, rates and costs to maintain the property.

You cannot claim capital depreciation, special building write-offs, costs to build and costs of borrowing money such as loan establishment fees.

Do you have an investment property? Are you happy with Centrelink’s valuation process? Why not let us know about your experience in the comments section below?

Also read: Centrelink Q&A: Carer fears for her future

Disclaimer: All content on YourLifeChoices website is of a general nature and has been prepared without taking into account your objectives, financial situation or needs. It has been prepared with due care but no guarantees are provided for ongoing accuracy or relevance. Before making a decision based on this information, you should consider its appropriateness in regard to your own circumstances. You should seek professional advice from a Centrelink Financial Information Services officer, financial planner, lawyer or tax agent in relation to any aspects that affect your financial and legal circumstances.

Jan Fisher
Jan Fisher
Accomplished journalist, feature writer and sub-editor with impressive knowledge of the retirement landscape, including retirement income, issues that affect Australians planning and living in retirement, and answering YLC members' Age Pension and Centrelink questions. She has also developed a passion for travel and lifestyle writing and is fast becoming a supermarket savings 'guru'.


  1. I am on the pension and own a investment property.
    The original loan was subtracted from the asset value at time of applying for the pension but was not subtracted in full as the loan was secured by both the investment property and my family home. After about a year I managed to get my title back from the bank and notified Centrelink of the change so the full loan amount could be subtracted from my assets . A further 6 months passed and I realised that Centrelink have not made the change to my assets . I complained to Centrelink and received the the lower asset assessment . I pointed out to Centrelink that the loan amount was reduced by 15 k as I had paid it down since first getting the pension . I was told not to bother about that and the original loan amount would be deducted from my assets.
    I’ve since paid down my investment loan another 40k but have not bothered to notify Centrelink. So at this point in time I still have the original loan amount deducted from my assets. I’m not sure if I am on unsafe ground or not. I may have to repay money or is it the practice to stick with the original loan amount until it is paid out in full??

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