How Much Can I Borrow for an Investment Property?

The Short Answer

It depends on three things: what you earn, what you already owe, and what you can put down as a deposit. Lenders look at all three together to work out how much they're comfortable lending you for an investment property.

Here's the part many homeowners miss: you may not need cash savings for the deposit at all. If you've owned your home for a few years, the equity sitting in it can often do that job - which means your borrowing power could be larger than you think.

What Lenders Actually Look At

An investment loan is assessed a little differently from the home loan you already know. Here's what matters:

According to Adel Pearce: "People are often surprised by what's open to them. The Scorecard gives you a realistic picture before you start dreaming about properties."

Home Equity: The Deposit You Might Already Have

Equity is the difference between what your home is worth and what you still owe on it. Lenders will typically let you borrow against your home up to 80% of its value while keeping the rest as a buffer - so your usable equity is roughly your home's value multiplied by 80%, minus your current mortgage balance.

A simple example: a home worth $800,000 with $400,000 still owing. Eighty percent of $800,000 is $640,000. Take away the $400,000 owing, and there's around $240,000 of usable equity - potentially enough for a deposit and purchase costs on an investment property, without touching your savings.

This is the mechanism behind most everyday Australians' first investment property: the home you've worked hard to pay down starts doing some of the heavy lifting. For the full walkthrough, see our guide on how to use home equity to invest and our plain-English explainer on usable equity.

LVR, Explained Simply

LVR stands for loan-to-value ratio - the size of the loan compared to the value of the property. Borrow $480,000 against a $600,000 property and your LVR is 80%.

Why it matters: most lenders are comfortable up to 80% LVR on investment loans. Go above that and you'll usually pay lenders mortgage insurance (LMI) - a one-off premium that protects the lender, not you. Staying at or below 80% generally means better rates, more lender choice, and no LMI.

The trade-off works the other way too: a lower LVR means borrowing less, which means a smaller purchase or a bigger deposit. There's no single right answer - it depends on your income, your buffer, and how conservative you want to be. Our property jargon guide covers LVR, offset accounts and the other terms lenders throw around.

The Costs Nobody Mentions

Your deposit isn't the whole story. You'll also need to cover stamp duty ($10,000-$25,000 depending on state and property price), conveyancing ($1,500-$3,000), building and pest inspections ($300-$600), loan establishment fees ($500-$1,500), and a cash buffer for the first few months of ownership - vacancies, repairs and rate movements happen.

Not just the deposit. The full picture. Budgeting for ownership, not just the purchase, is what keeps investors comfortable through the ordinary ups and downs.

Find Out Where You Stand

The Delphi Scorecard shows where you stand in under 5 minutes - your home, your equity, your income and your goal. No paperwork. No commitment. Just clarity on your numbers.

According to Adel Pearce, the "M" in S.I.M.P.L.E. stands for "Map Your Finance" - because you need to know your numbers before you look at a single property. And if it makes sense, you can book a free call to talk it through.

General information only. Not personal financial advice.