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How new investors can leverage equity

With home prices rising in value over the past few years, it is very likely that you may have accumulated some significant capital growth in your property. where you can use that newly created equity to expand your property portfolio.

One of the most powerful elements of owning property is the ability to access equity and put it towards the purchase of an investment property.

If you’re thinking about starting to grow your property portfolio, this is how you can potentially do it.


Know the equity in your property – Capital Growth

So how do you do this with any degree of confidence to begin with?

Based on the value of your property, your funder that will ultimately decide how much equity you can access.  So, knowing the value of your property in advance, can be a great advantage.  If you would like to know the value of your property, just call or email us and we will send you your Property Report free of charge.

There is no doubt that all homeowners/buyers want to see their property grow in value over time. This type of growth is driven by market conditions and is not something that you can control (unless you make some improvements to your property, such as a renovation for example).


Equity you can control – Cash Equity

If you’ve been channeling all of your income into your offset account or paying extra into your home loan as a redraw facility, then you will have access to excess funds that can be used at any time.


Combining the above two equity positions can be a very powerful tool that can enable you to buy your first or next investment property sooner.


Refinance or Top-Up

This strategy accesses the equity in your property by refinancing your loan to another funder or by topping up your existing loan with the same funder. In either case, your choice should always be based on which gives you the greatest benefit.


Use your equity

Once you’ve freed up the equity from your property using any of the above options, you can use it as a deposit on your first or subsequent investment property.


TIP #1 – Both equity positions should be reviewed on a regular basis to make sure that your structure is always working in your best interests. Please feel free to call or email us for some professional advice and together, we will make whatever changes are necessary.

As a property investor, it’s always a good idea to have a team of professionals such as a Mortgage Broker, Real Estate Agent, Solicitor/Conveyancer, Accountant, all working with you to maximise your outcomes.


TIP #2 – As a Property Investor, it is vital that you have a clear strategy in place before you start this journey. It is equally important that you have a finance strategy in place that supports your property strategy. This will help you avoid mistakes and support success as a property investor.


We are only a phone call away, on 02 8004 2222 or click to book an appointment.

Although we are located in Crows Nest, we service clients from St Leonards, Artarmon, Wollstonecraft, Cammeray, Northbridge, Naremburn, Neutral Bay, Greenwich, North Sydney, Waverton to Willoughby and all areas of Greater Sydney.

PS  This article is prepared based on general information. It does not take into account individual financial or property objectives or needs and is not financial product or investment advice.