Using Equity to Invest
Step-by-step on leveraging your property to buy again Already own a home? You might be sitting on a powerful tool — equity. Equity is the portion of your property you truly own, and it can be the key to buying your next investment property sooner. Here’s how to do it safely and strategically.
Step 1: Understand What Equity Is
Equity = Property Value – Loan Balance
Example: If your home is worth $700,000 and your loan is $400,000, you have $300,000 in equity.Lenders will usually let you access up to 80% of your home’s value (to avoid Lenders Mortgage Insurance).
In this case, you could use around $160,000 as usable equity.
Step 2: Get a Professional Valuation
Ask your lender or mortgage broker for a formal property valuation.
This confirms your home’s current market value — and determines how much equity you can unlock.
PropTip: Even small renovations or market changes can boost your valuation and increase your usable equity.
Step 3: Unlock Your Equity
You can access equity by:
Refinancing your current home loan for a higher amount.
Using a line of credit secured against your property.
The released funds can then be used for a deposit on another property, renovations, or strategic investments.
Step 4: Crunch the Numbers
Before diving in, review your position:
Can you comfortably manage two loans?
What are your rental yield and cash flow projections?
Are you targeting an area with strong growth potential?
Have you factored in costs like stamp duty and loan fees?
Planning your finance and risk upfront keeps your strategy sustainable.
Step 5: Put Your Equity to Work
Once your funds are released, your equity can become the deposit for your next property.
For example:
You release $160,000 from your current home.
That’s enough for a 20% deposit on an $800,000 investment property, plus purchase costs.
You now own two properties, both growing in value — and your wealth grows faster through leverage.
Step 6: Partner with the Right Team
Successful equity investing relies on good advice.
Work with:
A mortgage broker to structure your loans efficiently.
A buyer’s agent to find the right investment property (PropTip can help!).
An accountant or financial adviser to ensure your plan aligns with long-term wealth goals.
How PropTip Can Help
At PropTip, we help homeowners unlock their property’s potential through clear education and smart strategy.
We’ll show you:
How much equity you can use
Where to invest next
And how to grow safely without overextending
Whether you’re a first-time investor or building a portfolio, PropTip gives you the step-by-step roadmap to invest confidently.
Next Step: Book a free strategy chat to find out how much equity you could use to buy your next property.
Ready to Take the Next Step?
Book your free property strategy session with Proptip. Learn how to structure your purchase, use grants wisely, and get ready to buy with confidence.