• Login:
Welcome, Register Here
follow PropertyTalk on facebook follow PropertyTalk on twitter Newsletter follow PropertyTalk on LinkedIn follow PropertyTalk on facebook
Results 1 to 6 of 6
  1. #1

    Default Is 30% equity on my home enough to start investing? Thoughts?

    Hi all,

    this is my first post and I want to thank everybody for their willingness to help.
    I've been reading the forum for quiet sometime and I got a lot of info, I read a lot of books and I attended a few seminars as well but I think is time for me to take more action.

    I bought a house in February which I live in and I have a boarder in it which helps to pay the mortgage.

    my goal is to buy and hold, i have been looking at properties within a 300k-500k range in Wellington area.
    my question here is:
    is 30% equity on my home (about 97k) good enough to think of buying another house?
    or should I keep increasing that number and wait a bit longer?

    any advise, opinions, thoughts would be much appreciated.

    thanks in advance.

  2. #2
    Join Date
    Aug 2003


    Hi Elivi,

    20% min equity in your PPOR (home you live in) so you can borrow 80% of the approved reg. valuation.

    You need 35% min. equity for rentals and borrow max. 65% of the value.


    PropertyTalk Blogs - property articles

    BusinessBlogs - the best business articles are found here

  3. #3


    30% equity in your home means you have 10% equity "spare" to use as security (deposit) on an investment property.

    You then need 35% deposit on that investment property as Donna mentioned. So your spare 10% is 35% of _____? That is how much you can buy today, assuming you meet servicing criteria.

  4. #4


    Thanks a lot donna and Nick G!!!

    I better keep saving :-)

  5. #5
    Join Date
    Apr 2009


    Hi Elivi,

    It looks like you need to build up confidence.

    You mentioned boarders, this may be your strength and the type of real estate you can make work. Maybe one day you will become a commercial boarding house operator.

    Here is a suggestion to think about where to go from now:

    a) Sell your house through private sale (it's still a sellers market). This will give you $97k. You may be good at staging the house nicely to attract a better price. Of course you will then need to find a place to rent while you look for your next property, but you will be in a strong position as a cashed up buyer.

    b) Buy a $400k house ($80k deposit) and move in. Find a house which has the potential to improve, preferably the worse house on the best street type buy. When I say improve I don't mean a house which is falling apart needing major renovations, I mean one where you can spend $10k to add an additional bedroom, or furniture, for example.

    c) The more rooms the better for your rental income from boarders. You can present this income to the bank as they will take 80% of rental income towards your servicing of mortgages. A lot of people make more money in rental income than they do in their regular job.

    This will help you with your confidence and may take 9 months to complete, after-which you will be a better position and better experienced for the next step.

    Don't worry about the market going up or down. Just focus on building your rental income for now.

    This approach you can do now rather than waiting how long to save a 35% deposit for a regular $300k rental house which has less rental income than your by-the-room boarders.

    Your new home after your improvements may value up to nearly $500k if you bought well and improved well. The game is to make your own capital gains.

    Something to ponder. If you have any questions feel free to ask.
    Last edited by DaveW; 13-02-2019 at 02:56 PM.

  6. #6


    Hi DaveW,
    thanks a lot for advice, much appreciated


Thread Information

Users Browsing this Thread

There are currently 1 users browsing this thread. (0 members and 1 guests)

Similar Threads

  1. If banks start charging Low Equity Premium should house prices fall?
    By newbyvest85 in forum Finance, legal and tax (NZ)
    Replies: 7
    Last Post: 04-09-2017, 02:48 PM
  2. Investing in Point England - thoughts
    By marieh in forum Property Investment (NZ)
    Replies: 5
    Last Post: 02-06-2016, 07:24 PM
  3. Your thoughts on investing in Dunedin for an investing noob?
    By StartingOutInDunedin in forum Property Investment (NZ)
    Replies: 31
    Last Post: 03-03-2016, 06:30 AM
  4. Thoughts about investing in Christchurch
    By mgun020 in forum Property Investment (NZ)
    Replies: 50
    Last Post: 05-02-2015, 06:45 PM
  5. Investing in Invercargill for cashflow and equity
    By Clancy in forum Property Investment (NZ)
    Replies: 45
    Last Post: 12-01-2014, 09:02 PM
  6. The right start to investing.
    By Odin in forum Property Investment (NZ)
    Replies: 3
    Last Post: 28-08-2009, 09:37 AM
  7. Help where do I start with investing from scratch........
    By dontworrybehappy in forum Property Investment (Oz)
    Replies: 1
    Last Post: 11-02-2008, 10:32 PM
  8. I would start investing again when values drop:
    By Monid in forum Property Investment (NZ)
    Replies: 15
    Last Post: 17-01-2008, 10:06 PM
  9. What made you start investing?
    By McDuck in forum Property Investment (NZ)
    Replies: 43
    Last Post: 08-01-2007, 11:04 PM
  10. American Mortgage Rate feeds
    By sarahk in forum Property Investment (USA)
    Replies: 0
    Last Post: 26-06-2005, 08:28 PM

Tags for this Thread

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts