Can I use the equity in my current home as a deposit?

Yes, equity is a powerful tool that can help you to build a profitable investment property portfolio.

The equity in your home can be used as an investment property deposit and if you have enough equity built up, you can borrow 80% of the property’s value without having to use your own cash.

How equity is calculated

Your accessible equity is the difference between your home’s current value and how much you owe on your home loan.

If you’ve lived in your home for five years or more, you’ve probably accumulated quite a bit of accessible equity.

But lenders will only lend up to 80% of your home’s current value minus your current mortgage. This is known as your useable equity, which is quite a bit less than your accessible equity.

It can still however, be a significant amount for an investment property deposit or any other use you may have such as renovating, investing in shares or managed funds or improving your lifestyle with a holiday or a new car.

Buying an investment property

All investments carry some level of risk, so it’s important to get professional financial advice to fully understand your options.