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Buying a second property? Consider all options first

Buying a second property requires hard work with a disciplined and strategic approach. If done correctly, a second property as an investment can set you on the path to building greater wealth for your future.

Just because you have purchased one property doesn’t make the second one any easier and below you will find some areas to consider before you buy again.

Managing your finances and cashflow

The most critical and initial question you should ask yourself is are you covering your current home loan repayments comfortably? A comprehensive analysis of your current financial situation and projected future outlook will provide you with the understanding as to whether you can embark on a second home loan.


  • If you lose your job will you be able to cover two loan repayments until you find your next job?
  • Have you considered the impact of pregnancy on your financial situation if you plan to expand your family in the near future?
  • Do you have a back-up plan if any unforeseeable issues or major life changes arise in the future?
  • Have you factored in the additional costs of the investment property such as body corporate, rates, maintenance and repairs?

Lenders want to see that you have the capability to service two mortgages as well as your ongoing cost of living. A comprehensive assessment will be undertaken to assess any existing assets and liabilities along with projected income verses expenses. This is fundamental to ensure a positive cashflow to fund the costs of holding both properties.

What to buy?

Having a clear goal in mind is fundamental when researching to buy your second property. Are you buying to renovate and develop? Are you buying a beach house or rural property to spend some time in? Are you buying to rent it out as an investment property?

These key questions and reasons why one option is more suitable than another must be considered when researching the location and market situation of the ideal property. Your decisions regarding the type of property you’re after will guide the purchasing process so ensure you have clearly thought it through and have confidence in why you are buying again.

Loan structure and choosing the right mortgage

The mortgage type and structure is dependent on how much you can borrow in accordance with your current equity in your home, property valuation, income, expenses and the asset you are looking to buy. A full assessment of products with the right loan features to match your investment goals is essential to ensure a free-flowing purchasing process.

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