Educational information · Not a quote · beyondthebrochure.com.au · Sources retain their individual dates.

Evidence-led guidance · Mornington Peninsula

Do you have to sell the family home to pay for aged care?

Australia 2026: compare keeping, renting or selling the family home while separately understanding residential aged-care means assessments and Age Pension treatment.

Published by Tom Le Cerf · Sources retain their individual dates.

Do I have to sell the family home to enter aged care?

No automatic requirement to sell. Paying for residential aged care and choosing what to do with the family home are connected but distinct decisions. A provider can explain available payment methods; Services Australia or DVA assesses means; a qualified independent adviser can review the household’s goals and obligations.

The relevant questions are: Who owns the home? Does a protected person remain? Which aged-care fee and accommodation arrangements apply? Is an Age Pension assessment involved? Can the household meet cash-flow needs without committing to a sale?

Two government assessments — do not confuse them

What a house can mean for two different tests
Test	Relevant treatment	Next step
Residential aged-care means assessment	Keeping the former home can mean a capped amount counts as an asset, unless a protected-person exception applies. As at 20 September 2026, My Aged Care states a $219,858.40 cap (or lower net market value). Special couple rules apply.	Confirm ownership, protected person, entry cohort, relevant income and your Services Australia/DVA fee advice.
Age Pension means tests	The principal-home and assets/income rules are separate. A conditional two-year former-home exemption may apply when a person enters care due to illness, with exceptions where a partner remains living there and other circumstances. Rental income or sale proceeds can change the assessment.	Ask Services Australia what period, homeownership classification and income treatment apply to this household.

The aged-care capped-home figure is not a universal Age Pension home exemption or a forecast of how much the person will pay.

My Aged Care: residential means assessment · Services Australia: principal-home asset treatment

Keep vacant, rent out or sell — three questions to compare

Housing choice and the questions it raises
Option	Check before deciding	Avoid assuming
Keep it vacant	Maintenance and insurance, ongoing home expenses, protected-person status, aged-care home cap and Age Pension exemption period.	That keeping the house always preserves pension or always avoids assessed care contributions.
Rent it out	Net rental income, agent/repairs/insurance, tenants, aged-care means assessment and Age Pension income treatment.	That all rental income is ignored or automatically offsets accommodation costs in the same way.
Sell it	Sale costs, settlement timing, resulting cash/financial assets, applicable deeming and the chosen room payment mix.	That the house has to be sold before entry, or that sale proceeds are exempt from means testing.

None of these is a recommendation. Property, pension, tax, estate and accommodation outcomes can be material and depend on actual dates and financial circumstances.

Who counts as a protected person for aged-care assessment?

My Aged Care identifies a partner or dependent child living in the home, or an eligible carer or close relative who meets specified residence periods and Australian Government income-support conditions. The carer period is generally at least two years and close-relative period generally at least five years; merely being related or helping informally is not enough to establish eligibility.

The protected-person status and home occupancy can change. Ask Services Australia/DVA to confirm the evidence and the consequences if that person later moves.

Prepare these facts for an individual calculation

The resident’s permanent care entry date, any earlier Home Care Package status and applicable fee/accommodation arrangements.
Who owns the home, each partner’s position and whether an eligible protected person lives there.
Current residential-care means-assessment status and fee advice letter, with its issue date; ask whether a new SA485/SA457 or updated assessment is needed.
Whether the house would remain vacant, be rented or sold, with actual net income, outgoings and expected settlement dates where known.
Actual room price and payment choices (RAD, DAP or combination), and separate advice on any pension, tax, estate or cash-flow consequences.

My Aged Care says pre-entry fee advice is generally valid for 120 days; a change in circumstances may require an updated assessment. Read aged-care costs · Check the fee and accommodation dates · Organise an itemised quote.

Copy the separate-assessment questions

Do not upload private financial documents to this website. For official individual advice, contact Services Australia’s aged-care line on 1800 227 475, or My Aged Care on 1800 200 422. Seek independent financial/legal advice before deciding to dispose of property.

Editable family-home assessment request

The wording asks for a written explanation. It does not calculate pension, prescribe a home sale or submit personal details.

Editable request — copy into your own email

Subject: Written explanation of family-home treatment for permanent residential aged care

Hello [Services Australia / aged-care financial specialist / provider],

I am seeking information about how the existing family home at [general location] may affect the person’s aged-care costs and Age Pension.

Please explain these separately:
1. Residential aged-care means assessment: how the home is valued or capped, any protected-person exemption, and what changes if it is retained vacant, rented out or sold.
2. Age Pension assets and income tests: whether any principal-home exemption or two-year period applies, and how rent, sale proceeds or other financial assets would be treated.
3. Which agreement/entry dates and assessed fee arrangements apply, and whether an updated SA485, SA457 or other form and current fee advice letter is needed.
4. How accommodation payment choices and any refundable deposit would affect the means assessment and cash-flow questions.
5. Which documents and exact dates should be supplied to obtain a written individual calculation and who will notify the aged-care home of changes.

Please label all assumptions and dates, and explain any uncertainty. I am not asking for a decision to sell the home without independent advice.

Thank you,
[Person / authorised representative]
[Contact details]

No message is sent and no personal details are saved. If copying is unavailable, select the text manually. Verify the facts and recipient before sending.

Official sources and limits

My Aged Care: home assets and means testing · Services Australia: real estate and Age Pension · My Aged Care: room and accommodation agreement

Source review 13 November 2026. The capped-home amount is specifically dated 20 September 2026, not a live quote. This general guide does not determine a resident’s protected-person status, financial entitlement, individual tax position or the best housing choice.