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All Australians deserve secure housing and the independence to choose where they live and who they live with.

Predominantly funded via the National Disability Insurance Scheme (NDIS), there are now a range of short, medium and permanent housing solutions for people with disability.

Specialist Disability Accommodation (SDA) is a much-needed permanent housing solution and is designed for people with extreme functional impairment or very high needs. It aims to make accessing disability supports easier and provide choice and control to approved NDIS/SDA participants.
There is a significant shortage of appropriate SDA nationally and the sector requires much needed investment which can provide investors and the community with social and financial benefits.

What is the NDIS (National Disability Insurance Scheme)?

The NDIS, was established in 2013 to support people with disability and provides funding to eligible individuals (participants) so that they can purchase the disability related goods and services that they need. As at 31 March 2023 there were over 550,000* active participants with approved NDIS plans.

What is the SDA (Specialist Disability Accommodation)?

SDA is funded under the NDIS and assists participants to meet their home accessibility needs, live more independently and improve the delivery of their person-to-person care services. Dwellings must be independently certified, registered with the NDIS and enrolled for SDA use at a specific Design Category.

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Over 30,000 NDIS participants are expected to be eligible for SDA funding and there is an annual budget of $700m of which only half is being spent. The majority of existing SDA is older stock and group homes which are not meeting the needs of eligible participants. Moreover, there are nearly 1,500 participants stuck in hospitals and more than 3,000 people under 65 living in residential aged care many of whom will meet the eligibility criteria for SDA funding.

The funding for SDA covers the costs of building and maintaining the dwelling(s) and varies in level based on the building type, design category, location and how many participants will reside in it (see below for further detail). This funding is called the ‘SDA Payment’ and combined with 25% of a participants’ Disability Support Pension (DSP) and the Commonwealth funded Reasonable Rent Contribution (RRC) forms the Rental Income for an SDA Property.

Due to the various design and specification enhancements to an SDA dwelling, the costs to construct or purchase can be higher than a standard residential dwelling.

Fortunately, anyone looking to invest in SDA can apply for an NDIS property loan to help cover the costs.

What is an NDIS Property Loan for?

An NDIS Property loan has been designed to assist investors or NDIS participants buy or construct an SDA-compliant property.
Funding levels for SDA are designed to encourage investment and growth of the sector and can result in above average market rents which in turn increase valuations and enhance leverage and servicing capacity.

Whilst similar to other residential investments, SDA has unique risks so making informed decisions will enhance the chances of a strong returning investment.

Homestar Finance has in-house loan specialists who can guide you through the loan process journey from beginning to end – or alternatively, we can assist in refinancing your current SDA property.

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NDIS SDA Design Categories

There are 4 SDA design categories for new builds (pre-2016)

Improved livability

Housing with better physical access. It also has more features for people with sensory, intellectual or cognitive impairments and few stairs.

Fully accessible

Housing with a high level of physical access features for people who have lots of physical challenges and may need a manual or powered wheelchair at home, or can’t use steps.


Housing that is very strong and durable, reducing the need for repairs and maintenance. This type of design category may suit people who need help managing complex and challenging behaviours.

High support physically

Housing that includes a high level of physical access for people who need very high levels of support such as ceiling hoist, backup power supply, or home automation and communication technology.

NDIS SDA Property Building Types

With new build SDA dwellings, you must enrol them under a specific building type, which includes:


Beyond the usual structures, this type can also include detached low-rise buildings with a garden or courtyard


Mainly referring to self-contained units within a greater building complex

Townhouses, duplexes, villas

Semi-attached properties that have single land titles

Group homes

Only includes houses that hold up to five people

Other NDIS Property Requirements

Additional requirements to NDIS properties include:

  • SDA-compliant housing can only be considered for buildings made for long-term accommodation of at least one NDIS participant. This must be a permanent structure.
  • Even if the structure has been previously modified, is a parental home, or has received funding from the National Disability Insurance Agency (NDIA), it cannot be excluded from SDA.
  • The housing cannot already be funded by schemes or grants unrelated to disability.

Finding a tenant

Finding a NDIS participant approved for SDA to reside in your property is the critical area to making this type of investment work.

A SDA enrolled dwelling must have a registered SDA Provider linked to it and they receive the SDA income on behalf of the owner/investor. The SDA Provider is generally responsible for ensuring the property is tenanted by approved SDA participants.

Providers can be found via;

  • The NDIS provider finder searching the Registration Group “Specialist Disability Accommodation” and your state.
  • Local NDIS support co-ordinators
  • Local Disability Support Providers

How to get approved for an NDIS investment loan?

The process to getting approved itself is not that complicated, especially if you are already experienced in property investment, have connections to the NDIS or have already invested in SDA properties before.

A good starting point for any type of lending is:

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  • A good credit history and credit score
  • Stable employment with a reasonable income

Lenders are likely to approve of your loan if you are in contact with a registered SDA Provider and/or SDA-compliant builder who is aware of the intended tenant’s design requirements and/or you have an adaptable design already in place to build or renovate to.

As of March 2023, NDIS participants with SDA in their approved plans reached over 22,000 and there were only 3,500 new build enrolled dwellings. With approved SDA participants expected to double and more new build SDA desperately needed, this type of investment will provide social and financial benefits for years to come.

SMSF investors and NDIS property investment

For those with a Self-Managed Super Fund (SMSF), going into NDIS property investment over other potential investments can offer you significant benefits. Purchasing  approved SDA housing with your SMSF is a less riskier investment option for many. This is particularly true when contrasted against the rapidly changing stock market, or the potential underperformance of industry or retail funds.

Additionally, SDA can be invested in as part of a diversified asset allocation strategy in accordance with SMSF and NDIS investment property rules. With an SMSF, you can leverage your super to cover the costs that come with investing in such a property. In turn, this investment will eventually help fund your retirement, along with other investments in your portfolio.

Negative gearing outside of super

Negative Gearing refers to the situation where the expenses of an asset (including interest expenses) outweighs the income generated by it. This applies to all types of investment, even those outside of super.

The Australian personal income tax system allows for these negative expenses to be deducted from other income, such as wages and salaries, but many prefer not to reach this point. However, falling into negative gearing can be worth it in the case that the capital gain from selling the asset outweighs any expenses.

You may experience negative gearing during your investment into SDA housing, but the SDA payments/rental income along with some government funding should prevent a significant loss, or any loss altogether. Even if negative gearing does occur, the capital gain from selling may be significant enough to outweigh all expenses and land you in the green.

What you should know about an NDIS investment property?

Before choosing to start your journey into NDIS property investment properties, it is important to find a lender that is ready to support your cause. For those looking to buy within the NDIS sector, most lenders would be interested in lending the full 20% deposit due to the investment’s security and the government’s support.

However, do not just choose any lender for your big NDIS investment. At Homestar Finance, our home loan specialists are ready to put you first when it comes to finding you a loan that best suits you. For those with a good credit score, sufficient savings and an interest in expanding your property portfolio, start your journey into better investments with us today.


Get to know more about applying an NDIS loan

Contact one of our trained loan specialists at 1300 231 948 to learn more about opening an NDIS loan, or jump right in and enquire online today!

Disclaimer: This article is not intended as legal, financial or investment advice and should not be construed or relied on as such. Before making any commitment of a legal or financial nature you should seek advice from a qualified and registered Australian legal practitioner or financial or investment advisor.  

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    Understanding more about NDIS loans

    Is NDIS housing a good investment?

    Investing in a scheme that is backed by government support makes NDIS housing a safer investment than most. With plenty of costs being covered by said government’s support, investors may find this option particularly appealing. However, as with all investments, property market changes could happen suddenly, which can be intense in such a niche market. Always have a plan before attempting any investment to reduce risks.

    Can NDIS help with housing?

    NDIS can significantly contribute to the Australian housing market, especially as so many Australians live with disabilities that require specialised housing. Therefore, the scheme not only encourages investors to expand their property portfolio, but also provides many Australians in need with the housing they deserve.

    What are the NDIS housing requirements?

    Beyond the requirement of filing what building type and design category the SDA housing is, providers and their properties must also be enrolled with the NDIS. This enrollment should also include an outline on what features are there for aiding supported independent living, as these inform tenants on what properties are suited to them, while informing realtors how much the place should cost.

    How much funding does NDIS give?

    NDIS funding is intended to cover the cost of the building stipulated as an SDA home, but not the cost of rent or services and support required by tenants. It is expected to grow to approximately $700 million per year at full Scheme.