Same asset, two different repayment sources
To a valuer, an office suite bought by the business that will occupy it and an identical suite bought to lease out are much the same asset. To a lender, they are not. In the first case, the loan is repaid from the borrower's own trading cash flow; in the second, it is repaid from rent paid by a tenant the lender has never dealt with. That difference in who actually services the debt is what drives almost every gap in the terms that follows.
A loan to buy commercial property, whether owner-occupied or held as an investment, is also a business-purpose loan rather than one for personal, domestic or household use. ASIC's guidance on the scope of the National Credit Code confirms that credit provided wholly or predominantly for business or investment purposes generally falls outside the responsible lending obligations that apply to a home loan. That leaves individual lenders free to set their own deposit, pricing and serviceability rules, rather than working to the standardised consumer-credit framework used for home loans.
Deposit and LVR: the occupier gets more room
Australian Prudential Regulation Authority rules require every authorised deposit-taking institution to run a credit risk management framework, under Prudential Standard APS 220, that sets exposure limits and monitoring across all lending, including commercial property. APRA does not mandate a specific loan-to-value ratio for owner-occupied versus investment commercial loans; that calibration is left to each bank's own credit policy, and it consistently favours the occupier.
Macquarie Business Banking's published broker credit guidelines, for example, cap standard commercial owner-occupied lending at 80% of the security value, with medical professionals buying their own consulting rooms able to access an additional 10% under the bank's medical finance policy. Lenders assessing an investment-purpose purchase of the same class of property typically apply a materially lower ceiling, commonly in the order of 65-70%, because the debt is standing behind a tenant's covenant rather than the borrower's own trading history.
The assessment itself changes shape too. Loan Market's guide for business owner-occupiers notes that lenders in that scenario focus on the operating business: two to three years of financial statements, recent business activity statements and the stability of the industry it trades in. For an investment purchase, the same lenders instead work from the property: net rental income after outgoings, the strength of the tenant, the term remaining on the lease and the capitalisation rate implied by the purchase price.
Pricing follows the same logic
Base commercial lending rates move with the Reserve Bank of Australia's cash rate target, which the RBA's Monetary Policy Board held at 4.35% at its 12 August 2026 meeting. On top of that base, lenders layer a margin that reflects the risk they are pricing, and brokers consistently describe investment-purpose commercial lending as attracting a higher margin than an owner-occupied loan of equivalent size, term and security at the same institution. The exact margin varies by lender and by deal, but the direction is consistent: a bank relying on a third party's lease rather than a borrower's own business prices that risk in.
Tax and GST diverge at settlement
On interest deductibility the two scenarios end up in a similar place by different routes. The Australian Taxation Office's guidance on buying commercial property confirms interest on the loan used to acquire it is deductible, whether it is claimed as a business expense against trading income for an owner-occupier or as a rental deduction against rental income for an investor. In both cases the deduction follows the use of the borrowed funds, not the type of security given for the loan.
Where the two purchases can look genuinely different is at settlement, through GST. The ATO's guidance on selling a going concern sets out that a sale of tenanted commercial premises can be GST-free where the existing leases and the leasing enterprise are sold together with the property and both parties agree in writing that it is a going concern, a treatment generally only available because an investor is buying an operating leasing business along with the building. An owner-occupier buying vacant possession to move their own operation in has no leasing enterprise to acquire, so the purchase is more likely to attract GST upfront, recoverable as an input tax credit if the buyer is registered for GST and the premises are used for a taxable business purpose, but a real difference in the cash needed on settlement day regardless.
What this means when you're comparing offers
Ask a lender upfront which basis they intend to assess you on, since a purchase that looks like a straightforward owner-occupied deal can be treated as investment lending if part of the space will be leased to another business. Confirm the LVR and deposit that basis implies before relying on a headline commercial rate, and budget for the GST position at settlement rather than assuming it will mirror the last purchase you or a colleague made. This is general information, not financial, tax or legal advice. Commercial lending terms vary by lender, borrower and security, and going concern GST treatment depends on the specific facts of a sale. Regulatory and rate figures above are drawn directly from the sources listed; lender policy details are illustrative of current practice, not exhaustive of every lender.