Using Equity to Purchase an Investment Property
UNLOCKING THE VALUE IN YOUR HOME
As property values continue to rise across Sydney and loan balances reduce over time, home equity can become a powerful tool to help purchase an investment property — often without the need for a cash deposit. When used correctly, equity can support long-term wealth creation through property investment.
WHAT IS EQUITY?
Equity is the difference between your property’s current market value and the balance remaining on your home loan.
In most cases, lenders will allow you to access equity up to 80% of your property’s value without paying Lenders Mortgage Insurance (LMI).
For example, if your home is worth $1,000,000, 80% of that value is $800,000. If your current loan balance is $500,000, you may be able to access up to $300,000 in equity without paying Lenders Mortgage Insurance (LMI), subject to lender assessment.
This equity can then be used as a deposit or to cover purchasing costs for an investment property.
BENEFITS OF USING EQUITY TO PURCHASE AN INVESTMENT PROPERTY
Benefit from long-term property value growth
Use up to 80% of your home’s value and avoid paying Lenders Mortgage Insurance (LMI)
Access possible tax benefits, including deductible interest and property expenses
Choose between negative or positive gearing depending on your goals
Access equity in your existing home to support your investment plans sooner
Buy an investment property without needing a large cash deposit
Keep your savings available for other expenses
GET IN TOUCH
If you’re considering using your home equity to purchase an investment property, reviewing your current loan structure is the first step.
Get in touch to explore your options and see how your equity could work for you.