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Mortgage Mantra

Second Home Buyers

You’re considering buying a second home - congratulations! The next step is to decide whether you are going to sell your existing property first, buy a new one first, or hold onto your existing property as an investment! Talk to us to find out the best option for you and your property plans! Mortgage Mantra is here to help you make the right decision for your particular requirements backed by up-to-date property market knowledge and broker expertise!

Explore your options here!

Mortgage Mantra

Buy, Sell, or Hold?

There is a lot to consider when buying your second home, it can often feel more complicated than buying your first as there are more factors to weigh up. When choosing to buy a second home, you can choose to buy a new property before selling your first one, sell your first property before buying a second one, or buy a second property but hold onto the first as an investment. Investment properties are usually rented out so that over time, your mortgages are helped by the payments you receive from your tenants who live in your investment property
Second Home Buyers

Pros and Cons

How much deposit do I need for a second home ?

Before you start considering buying a second home, now is a good time to get your finances sorted. Knowing exactly how much you are willing, or can afford, to put down as a deposit on a second home is not something that should be guessed.

How much do I need?

About 20% of the value of the property. This varies from seller to seller, but generally, that is the suggested ballpark figure. The criteria of a deposit vary between lenders so it is best to ask the specific questions to the lender you are looking to buy from. So if you are looking at a property for $600,000, you’d need to put down a $120,000 deposit to secure it

Using the Equity from your existing property

If you are planning on using your equity from your first home as a way to borrow more money to put a deposit down on a second home, you need to understand your borrowing power. As a general rule, you should leave 20% in your property and deem it as unusable. To work out your usable equity, take the value of your house and then multiply it by 0.8, then minus your mortgage. This money can be used as a deposit alongside any other equity and cash.

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