Quick answer
Caravan and holiday parks borrow to add cabins, rebuild amenities blocks, upgrade powered sites and pools, fix roads and infrastructure, and buy a freehold or leasehold park. Lenders look at income by site type, peak and off-peak occupancy, permanent and long-stay residents, the land tenure or Crown lease and the condition of the park. Purchases and large builds usually rely on property security.
Key points
- Income is split between cabins, powered sites, tent sites and long-stay residents.
- Peak holiday weeks can carry a big share of the year.
- Freehold, leasehold and Crown land tenure are assessed very differently.
- Cabins add income but are costly to build and maintain.
- Common uses
- Cabins, amenities, infrastructure, purchases
- Lenders focus on
- Occupancy, tenure, site mix, condition
- Unsecured options
- Typically $5k – $500k
- Property-secured
- $20k – $5m
A caravan park is part property investment, part hospitality business. There’s land, roads, power and sewer to look after, and there’s a front office taking bookings for cabins, powered sites and tent pitches through school holidays and long weekends. Some parks also house permanent residents and long-stay workers. Lenders weigh all of it: the steady income, the seasonal peaks, the tenure of the land and how much the infrastructure needs spending on.
What do caravan and holiday parks borrow for?
- Cabins and glamping. New cabins, villas or safari tents that earn more per night than a powered site.
- Amenities blocks. Rebuilding toilets, showers and laundries, often the first thing guests judge.
- Powered sites and infrastructure. Upgrading power, water, sewer, roads and drainage.
- Guest facilities. Pools, camp kitchens, playgrounds and jumping pillows that lift occupancy and reviews.
- Buying a park. A freehold going concern, a leasehold, or a park on Crown land.
- Off-season cash. Wages, maintenance and insurance through the quieter months.
How do lenders assess a caravan park?
Income by site type. Cabins, powered sites, unpowered sites and long-stay residents each earn differently. Lenders like a breakdown so they can see where the money really comes from.
Occupancy across the year. Most parks run full over Christmas and Easter and much quieter in winter — unless they’re in the tropics, where the pattern flips. Booking system reports covering at least a full year help the lender see the real shape.
Land tenure. A freehold park is valued largely as property. A leasehold park depends on the lease term and rent. Parks on Crown land operate under a lease or licence from the state, and its remaining term and transfer conditions matter a great deal.
Condition and compliance. Councils and state authorities regulate caravan parks, and what applies depends on your state and location. As business.gov.au explains, most licences and permits for accommodation businesses sit with local councils and state or territory governments. Lenders want the park’s approvals current and its infrastructure in reasonable shape.
Operator experience. Managing a park is a seven-day job. Lenders feel more confident when the buyer has run accommodation or hospitality before.
Planning new cabins before next summer? See if your park qualifies — enquiring won’t affect your credit score.
A closer look: adding cabins
Cabins are often the best way to lift a park’s income. A good cabin can earn several times what a powered site does in peak season, and it books outside school holidays too, when couples and grey nomads travel. But cabins cost real money to build or buy, need council approval, and must be cleaned and maintained.
Lenders ask:
- how full existing cabins are across the year;
- whether you’re turning guests away in peak season;
- what the new cabins cost, delivered and connected;
- whether approvals are in place;
- how the extra cleaning and maintenance will be staffed.
| Funding route | When it suits |
|---|---|
| Property-secured loan | Several cabins, larger builds, freehold parks |
| Equipment or asset finance | Relocatable cabins that can be removed and resold |
| Unsecured business loan | One or two units, or furnishing and fit-out |
| Line of credit | Ongoing maintenance and off-season costs |
Buying a caravan park: what lenders look for
Park purchases are where most of the borrowing happens. Business.gov.au’s guide to how to buy an existing business recommends checking the records, leases and licences before you sign, and a lender will do the same. Expect requests for:
- two to three years of financials and recent BAS;
- booking system reports showing occupancy by site type;
- the title, lease or Crown tenure documents;
- council approvals and any compliance notices;
- a building or infrastructure report on amenities, power and sewer;
- your own accommodation or hospitality experience.
Freehold parks usually suit commercial property loans, while leasehold purchases are often structured as business acquisition loans backed by other property.
What red flags do lenders see?
- Ageing amenities and infrastructure with no budget to fix them.
- A short lease or Crown tenure close to expiry.
- Occupancy falling or relying on one peak period.
- Compliance notices from council or the state regulator.
- Owners stretched thin with no relief manager.
- ATO debt after a weak season (considered case by case).
Questions a lender will ask a park owner
- How does income split between cabins, sites and long-stay residents?
- What’s the occupancy in January compared with July?
- How long is left on the lease or Crown tenure?
- What maintenance is due in the next three years?
- What will the funding change — more nights booked, higher rates, lower costs?
Illustrative example: a coastal park adds cabins
Illustrative example: a freehold coastal caravan park books out its six cabins every school holiday and turns away dozens of enquiries. The owners want $420k to install six more cabins and upgrade the camp kitchen. Booking reports show strong peak demand and decent shoulder-season cabin occupancy. Council approval is in hand. The lender provides a property-secured facility over the park, with the owners keeping a smaller line of credit to cover winter maintenance. The motel guide and tourism operator guide cover neighbouring accommodation businesses.
Common misconceptions about caravan park finance
“A freehold park is just a property loan.” The land matters, but lenders still read the trading figures closely. A park with falling occupancy or tired amenities is worth less as a going concern, and that flows through to what it can borrow.
“Permanent residents make the park a sure thing.” They bring steady income, but lower yield per site and, in some states, specific rules about residential parks. Lenders look at the mix, not just the stability.
“We’ll fix the amenities once business picks up.” Guests read reviews. Run-down facilities often cause the slowdown, so funding the upgrade can be what turns occupancy around.
When should a park owner apply?
Give yourself plenty of runway. Cabins can take months to approve, build and install, and contractors are hard to book in the lead-up to summer. Starting the finance conversation in autumn or early winter, using a full year of booking data, means the new cabins or amenities can be ready before the next peak. For a purchase, talk to a lender as soon as you’re seriously looking at a park, because tenure and approvals take time to review.
Could your caravan or holiday park qualify?
Parks are long-term businesses, and the right finance should match that. The enquiry takes about 60 seconds and there’s no credit check just for asking. We won’t send your details to a crowd of lenders. Someone who understands accommodation businesses will look at your park and call you. Please enter your turnover, the amount and any property accurately so the first option we discuss is the right one.
Frequently asked questions
Can I borrow to add cabins to my caravan park?
Yes. Lenders look at existing cabin occupancy, how quickly new cabins are likely to fill and whether council approvals are in place. Strong peak-season demand that turns guests away is a good sign.
How do lenders treat permanent residents?
Long-stay and permanent income is steady, which lenders like, but it usually earns less per site than holiday trade. A balanced mix is often viewed as lower risk than a park that relies entirely on tourists.
Is a park on Crown land harder to finance?
It can be. A lender wants the lease or licence to run well beyond the loan term and to be transferable. Shorter Crown tenure may limit the amount or term on offer.
Can I get a loan to buy a leasehold park?
Often, yes. Lenders review the park's trading history, the lease term and rent, and your experience. Many leasehold buyers use equity in other property as security alongside the park's income.
Do lenders care about deferred maintenance?
Yes. Old amenities blocks, failing roads or outdated power and sewer systems can be costly. Lenders want to know they are budgeted for, and a loan that fixes them can strengthen the park's future income.