If a bankrupt owns, or is purchasing, a home which is in the bankrupt's name, the trustee has the right to sell the property and distribute any equity to the creditors. This does not apply to homes purchased with Defence Service Homes loans which are protected under the Defence Service Homes Act 1918 (Cth) and the Director will rarely give permission for the sale to take place.

In the case of jointly owned property, when one owner becomes bankrupt the trustee will become registered as a 'tenant in common' of the home with the non-bankrupt owner, or will lodge a caveat on the title to protect the bankrupt's interest.

The registration of the trustee does not prevent the mortgagee selling the property if the mortgage payments fall into arrears. The jointly owned home may be sold in any of the following ways:

If the home was bought with, or substantially with compensation money for an injury it cannot be taken, see property a bankrupt can keep.