The most common way investors fund their next purchase isn't saving a fresh deposit — it's tapping the equity they've already built. Here's how that generally works. This is general information about the credit side, not financial or tax advice.
What is usable equity?
Equity is your property's value minus what you owe. Usable equity is the portion a lender will let you access — typically up to about 80% of the value minus your current loan (you may be able to go higher with Lenders Mortgage Insurance).
For example, on an $800,000 property with a $300,000 loan, usable equity at 80% is roughly $640,000 − $300,000 = $340,000. Try the numbers in our equity for your next property calculator.
How investors use it
That usable equity is generally released by refinancing or a separate facility, and used as the deposit and costs on the next purchase. Done well, it lets you keep investing without saving a full deposit each time.
Things to weigh up
- Releasing equity increases your total borrowing, so serviceability still has to stack up — check can I afford the next one?.
- How the new lending is structured matters (see cross-collateralisation vs standalone loans).
- Borrowing to invest magnifies gains and losses; values and rents aren't guaranteed.
We can help
We'll work out your usable equity, structure the release sensibly and find a lender that fits — talk to us about investment loans or refinancing. Get started.