Selling, keeping or renting the family home: how the aged care rules treat each

Nobody has to sell to move in

This is usually the first worry, and the answer is clear: no rule says the family home must be sold before someone moves into an aged care home. A home cannot ask for accommodation costs before the person moves in, and every resident has the right to choose how to pay.

The room can be paid for three ways: a refundable lump sum (a refundable accommodation deposit, or RAD), a daily payment that works like rent (a daily accommodation payment, or DAP), or a mix of the two. People with lower means pay a contribution towards the room instead, and the government pays the rest.

What the home changes is the money: how much the person contributes to their care, how much Age Pension they get, and whether there is cash for a lump sum. Those effects depend on who lives in the home, the person's other income and assets, and how the room is paid for. This guide explains the published rules for each path. It does not say which path suits anyone, because that depends on the whole picture.

Source: Department of Health, Disability and Ageing: managing accommodation costs

How the home counts for aged care fees

Services Australia's means assessment sets what the person contributes to their care and whether the government helps with the room. If the person keeps the home and no protected person lives there, it counts as an asset, but only up to a cap:

• the home is counted at its net market value or $219,858.40 (as at 20 September 2026), whichever is lower
• for a couple, each partner is treated as owning half, and the cap applies to each half
• the cap is indexed in March and September each year.

So a home worth far more than the cap is still counted at the cap for as long as it is kept. Its full value only comes into the aged care means assessment if it is sold, because the money from the sale then counts as an ordinary asset.

When a protected person lives there

The home is not counted at all if, when the person moves into care, it is lived in by a protected person:

• their partner, or a dependent child
• a carer who provides daily care, has lived with them for the past 2 years, and is eligible for an income support payment
• a close relative (parent, brother, sister, child or grandchild) who has lived with them for the past 5 years and is eligible for an income support payment.

The carer or relative only needs to be eligible for an income support payment, not actually receiving one. Services Australia collects their details in a separate carer or close relative assessment, done online or on form SA483.

If the protected person later moves out, the home can start to count. That is a change to report to Services Australia (or DVA) within 28 days.

Source: My Aged Care: means assessments for residential aged care

How the home counts for the Age Pension

The Age Pension has its own, different rules:

• The former home stays exempt from the pension assets test for 2 years after the person moves into care. The homeowner asset limits keep applying during those 2 years.
• It stays exempt for as long as the person's partner lives in it.
• After 2 years, if it has not been sold and no partner lives there, it is counted at its market value and the person is assessed as a non-homeowner. The non-homeowner limits are higher, but the home's whole value now counts, so a part pension can fall or stop.
• If the home is sold within the 2 years, the person moves to the non-homeowner limits, and the money from the sale counts as a financial asset that is deemed to earn income.

Services Australia revalues residential property each year using local market data. If you disagree with its value, you can ask it to reconsider, and it may arrange an on-site valuation at no cost.

Source: Services Australia: real estate assets

If the home is sold

Selling changes both tests at once:

Both tests apply the same deeming rates. As at 20 September 2026, the first $66,800 of a single person's financial assets is deemed to earn 1.75% a year, and anything above that 3.75%.

Other points from the published rules:

• Selling the home, and paying a lump sum to the aged care home, are both changes to report to Services Australia (or DVA) within 28 days.
• Assets given away, or sold for less than they are worth (including a home sold to family below market value), can still be counted under the gifting rules in both tests.

Source: DVA: residential aged care means testing (selling your home)

Paying for the room while the home is on the market

Selling a house takes time, and the rules allow for it. For people who first entered care from 1 November 2025:

• There is no deadline to choose how to pay for the room. Until a lump sum is paid, the room is paid for with daily payments.
• A lump sum can be paid, in full or in part, at any time after the means assessment is finalised (or "means not disclosed" status is set). A part lump sum can be topped up later, and each payment reduces the daily payment from then on.
• Daily accommodation payments are indexed on 20 March and 20 September each year.

People who entered care before 1 November 2025 were under the older rules: they had 28 days after moving in to choose how to pay, and up to 6 months to pay a lump sum.

How much the daily payment is

The daily payment is the room price multiplied by the maximum permissible interest rate (MPIR), divided by 365. The MPIR is 8.51% for room prices agreed from 1 October 2026, and the rate on the day the price is agreed stays with the person while they are in that room. On a room priced at $500,000, the full daily payment works out at about $116.58 a day before indexation.

What to watch while the sale goes through

• Daily payments have to be kept up. If agreed accommodation costs go unpaid for 42 days for reasons within the resident's control, the home can ask them to leave, although it must first find them suitable other accommodation.
• If paying is genuinely hard, financial hardship assistance through Services Australia can help with the basic daily fee, means-tested fees and daily accommodation payments.
• The home can ask for daily payments up to one month in advance, but no more.

For how the two ways of paying work, see RAD or DAP: paying for the room.

Source: Department of Health, Disability and Ageing: managing accommodation costs

If the home is kept and rented out

Some families keep the home and rent it out. The published rules on rent are:

• Aged care means assessment: net rent from the former home counts as income for anyone who entered permanent care on or after 1 January 2016. The home itself still counts at the capped value, unless a protected person lives there.
• Age Pension: rent counts as income. The home stays exempt as an asset for the first 2 years, then counts at its market value.

Concessions that kept rent out of these calculations apply only to some people who entered care before 2016 (for aged care fees) or before 2017 (for the pension), generally where the room was paid by daily payments.

A home that is kept, whether rented or empty, still needs looking after: insurance, rates, repairs and someone to manage it. Those costs and tasks are part of the picture too.

For anything to do with tax, including on rent or a later sale, speak to a registered tax agent.

Source: DVA: residential aged care and your income support payments (renting out your home)

The Home Equity Access Scheme

The Home Equity Access Scheme is a voluntary loan from the Australian Government, run by Services Australia, secured against real estate the person owns in Australia. Services Australia publishes these details:

• Who can get it: people who (or whose partner) are Age Pension age or older, who get or qualify for a qualifying pension (including a pension paid at a zero rate because of income or assets), who own Australian real estate to secure the loan, and who have adequate insurance on it.
• How it is paid: fortnightly, as a lump sum advance, or both. For a pensioner, the pension and the fortnightly loan together cannot be more than one and a half times the maximum pension rate.
• Repayment: the loan, interest and legal costs are repaid to the government. Interest compounds fortnightly on the balance until it is repaid in full.
• Effect on the pension: advances are deemed and counted in the pension income and assets tests, with a 90-day assets test exemption when the principal home secures the loan.

DVA adds that payments under the scheme can count as income in the aged care means assessment, and that if the home is sold, the remaining loan balance has to be repaid from the sale.

Services Australia suggests getting legal or financial advice before applying. The current interest rate, the calculators and how to apply are on the Services Australia Home Equity Access Scheme page.

Source: Services Australia: Home Equity Access Scheme

Questions to take to an adviser

The rules above are the same for everyone. What they add up to for one family is not, and working that out is personal financial advice. These are questions to write down for a licensed financial adviser who works in aged care, or to ask the Financial Information Service about:

• If the home is kept, what will the aged care contributions and the pension be now, and after the 2-year pension exemption ends?
• If it is sold, what happens to both once the money from the sale is deemed, and if some of it is paid as a RAD?
• If it is rented, how does the rent change the contributions and the pension?
• What would different mixes of lump sum and daily payment mean for fees and for cash flow?
• For a couple, how does each path affect the partner at home?
• Who has the legal authority to sign a sale contract or a lease if the person cannot? See enduring power of attorney.

The Financial Information Service is free on 132 300. Its officers explain how the rules and financial products work, but they do not give financial advice or recommend advisers. Check any adviser on the Financial Advisers Register at moneysmart.gov.au before engaging them, and take tax questions to a registered tax agent.

Source: Services Australia: Financial Information Service