How To Buy A Investment Property Using Equity Apr 2026

Using the in your current home can be a powerful way to jumpstart an investment portfolio without needing a massive cash deposit. Essentially, you are leveraging the value you've already built to fund a new venture. 1. Calculate Your Useable Equity

Since property markets fluctuate, your home might be worth significantly more than when you bought it. Contact your or a mortgage broker to arrange a formal valuation . This official number dictates exactly how much equity you can access. 3. Choose Your Financing Strategy There are two common ways to structure this: how to buy a investment property using equity

Once your finance is pre-approved, you can shop for an investment property as a "cash" buyer for the deposit portion. Once settled, the goal is for the and capital growth of the new property to outperform the interest cost of the equity you borrowed. Using the in your current home can be

Most banks use an rule. To find your "useable" equity: Take 80% of your home's current value . Subtract your remaining mortgage balance . how to buy a investment property using equity

Even if you have $500k in equity, a bank won't lend to you if your can't support the higher loan repayments. They will look at your salary , existing debts , and the projected rental income from the new investment property to ensure you can afford the "buy-in." 6. Execute and Manage

The result is the amount you can potentially borrow for a deposit on a new property. 2. Get a New Valuation

Equity is the difference between your property’s current and the amount you still owe on your mortgage . However, lenders won’t let you borrow the full amount.