In a move set to enhance borrowing potential, banks are now allowing certain home buyers to include boarder income when applying for a home loan.

The Commonwealth Bank has confirmed that it will factor in income derived from renting a room to a relative or friendl, an approach not previously accepted in mortgage assessments.

Under the revised policy, borrowers can include income of up to $150 per week from one boarder when calculating serviceability.

This change is designed to support first-home buyers by recognising additional sources of income that may improve their ability to meet loan repayments.

It is important to note that the policy is not available to investors and is restricted to owner-occupiers.

According to a Commonwealth Bank spokesperson, the initiative is expected to assist more Australians in accessing the property market.

By including boarder income, eligible borrowers could increase their borrowing capacity by up to $50,000, depending on their individual circumstances.

This adjustment aligns with broader efforts to support housing accessibility, particularly for first-home buyers facing affordability constraints.

Those receiving guarantor support, accessing First Homeowner Grants, or participating in the Home Guarantee Scheme will also be eligible under the new criteria.