STEP 1

Define Your Investment Strategy

Before searching for a property, it's important to understand what you're trying to achieve.

Your goals may include:

Refinancing only works if it aligns with your goals—otherwise, you could end up worse off.

• Long-term capital growth
• Generating rental income
• Building a property portfolio
• Creating passive income for retirement
• Using property to build wealth over time
• Diversifying your investment portfolio

If you already own investment properties, consider how your next purchase fits within your broader investment strategy and long-term financial objectives.

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STEP 2

Review Your Current Financial Position

Understanding your financial position is the foundation of any successful investment decision.

Review your:

Income

• Salary and wages
• Self-employed income
• Rental income
• Investment income
• Other sources of income

‍Liabilities

• Home loans
• Investment loans
• Personal loans
• Credit cards
• Buy Now Pay Later facilities

Assets

• Existing properties
• Savings
• Shares and investments
• Superannuation

For existing property owners, reviewing current property values and available equity may reveal opportunities to fund future purchases without relying solely on savings.

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STEP 3

Understand Your Borrowing Capacity

Before making an offer on a property, it is worth understanding how much you may be able to borrow.

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Lenders typically assess:

• Income and employment
• Existing debts and commitments
• Living expenses
• Rental income
• Number of dependants
• Credit history

For investors with existing properties, lenders will also consider rental income, existing investment debt and overall portfolio exposure.

Obtaining a pre-approval can provide greater confidence when searching for a suitable investment property.

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STEP 4

Determine Your Funding Strategy

There are generally two ways investors fund a property purchase.

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Using Savings

Many investors contribute a cash deposit to cover purchasing costs such as stamp duty and legal fees, along with funds.

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Using Equity

If you already own property, you may be able to access equity to help fund:

• Deposits
• Stamp duty
• Legal and conveyancing costs
• Other purchasing expenses

Using equity can be an effective strategy for investors looking to grow their portfolio while preserving cash reserves.

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STEP 5

Budget for Purchase Costs

When purchasing an investment property, it's important to budget for more than just the purchase price.

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Common costs include:

Deposit: Usually between 5%and 20%+

Stamp Duty: Varies by state and purchase price

Conveyancing Fees: Legal costs associated with settlement

Building & Pest Inspections: Recommended before purchase

Loan Costs: Depending on lender and loan structure

Lenders Mortgage Insurance (LMI): May apply when borrowing above certain LVR thresholds

Having a clear understanding of these costs can help avoid surprises during the purchasing process.

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STEP 6

Research the Market

Location remains one of the most important factors influencing investment performance.

When assessing a suburb, consider:

• Population growth
• Infrastructure projects
• Employment opportunities
• Public transport access
• Schools and amenities
• Vacancy rates
• Rental demand
• Future development plans

Strong fundamentals often contribute to long-term property performance and tenant demand.

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STEP 7

Choose the Right Property

Different property types may suit different investment strategies.

Houses

• Often offer stronger land value growth
• Popular with families and owner-occupiers
• Typically have higher land content

Townhouses

• Balance affordability and growth potential
• Can appeal to both owner-occupiers and tenants

Units and Apartments

• Often have lower entry prices
• May provide stronger rental yields
• Can suit investors seeking cash flow

The right property is one that aligns with your personal objectives, risk profile and financial situation.

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STEP 8

Understand Rental Returns and Cash Flow

A property's rental income should always be considered alongside its ongoing expenses.

Income Considerations

• Current market rent
• Vacancy rates
• Potential rental increases
• Tenant demand

Expense Considerations

• Loan repayments
• Council rates
• Water charges
• Insurance
• Property management fees
• Repairs and maintenance
• Repairs and maintenance
• Body corporate fees (where applicable)

Understanding your likely cash flow position can help you determine whether a property supports your investment goals.

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STEP 9

Structure Your Finance Correctly

The way your loan is structured can impact both current cash flow and future investment opportunities.

Investors commonly consider:

• Principal and Interest repayments
• Interest-only repayments
• Fixed versus Variable interest rates
• Offset accounts
• Multiple loan splits
• Equity access strategies

A well-structured loan can provide greater flexibility and may help support future investment plans.

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STEP 10

Complete Your Due Diligence

Before committing to a purchase, ensure appropriate research has been completed.

Consider:

✔ Reviewing the contract of sale

✔ Obtaining building and pest inspections

✔ Confirming rental appraisals

✔ Researching comparable sales

✔ Understanding local market conditions

✔ Reviewing body corporate records where applicable

Taking the time to complete due diligence can assist in making a more informed investment decision.

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STEP 11

Settlement and Property Management

Once your purchase settles, there are several important steps to consider.

These may include:

• Arranging landlord insurance
• Appointing a property manager
• Organising depreciation schedules
• Setting up loan accounts correctly
• Reviewing rental income and expenses
• Establishing an ongoing maintenance plan

Effective management can play a significant role in protecting your investment over the long term.

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STEP 12

Review Your Portfolio Regularly

Property investing is an ongoing process rather than a one-time transaction.

Regular reviews may help identify opportunities to:

• Access available equity
• Improve loan structures
• Review interest rates
• Increase cash flow
• Purchase additional investment properties
• Adjust your strategy as market conditions change

Many experienced investors use regular portfolio reviews to ensure their investments continue to align with their goals.

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Common Property Investment Mistakes to Avoid

• Purchasing without a clear strategy
• Overextending borrowing capacity
• Focusing solely on tax benefits
• Ignoring cash flow considerations
• Underestimating maintenance costs
• Failing to review existing loans regularly
• Not understanding available equity opportunities
• Purchasing based purely on emotion

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How Market Brokers Can Help

At Market Brokers, we assist investors at all stages of their property journey.

Our team can help with:

• Investment property finance
• Borrowing capacity assessments
• Pre-approvals
• Equity release strategies
• Loan structure reviews
• Portfolio growth planning
• Refinancing existing investment loans
• Comparing options across a range of lenders

Whether you're purchasing your first investment property or adding to an established portfolio, we can help you understand your options and structure your finance to support your long-term objectives.

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Ready to Explore Your Investment Options?

Every investor's situation is different. Understanding your borrowing capacity, available equity and lending options before purchasing can help you make more informed decisions.

If you're considering purchasing an investment property or reviewing your existing portfolio, the team at Market Brokers is here to help.

Contact Market Brokers today to discuss your investment goals and explore your finance options.