Should you keep your old property as an investment if you move?

Is your home no longer fitting your needs? Whether you need some more room, less room, are keen on a different location or something else entirely, a need for a property change happens to just about everyone at some point. While you may think that you’ll need to sell your property to purchase the next one, there are plenty of reasons why keeping your old place could be a smart choice to help build your future wealth.

If it’s time to upgrade, then keeping your old place could be a lot easier and affordable than you think and could result in a bunch of great benefits in the future. It’s worth considering all the options when you’re considering a move, so our team at Mortgage Choice in Arundel and Broadbeach will help you determine what you can comfortably afford. 

Here are some of the reasons why keeping your old home as an investment could be the right decision if you decide to relocate.

It’s likely more affordable to keep your old home than you think

Many homeowners assume that it would be too financially stressful to keep their old property as an investment, but this is often not the case.

Turning your previous home into an investment can be very affordable with the right loan structure in place. Plus, it can be very effective to leverage your existing property to buy your next home.

Our Broadbeach and Arundel mortgage brokers have helped many customers with this process and are experienced in how to make it work to your advantage in building future wealth.

You can use your equity to help finance your next property

Have you owned your home for a few years? You could have a decent amount of equity available to help finance your next purchase while keeping your old home.

When it comes to how much you can borrow, equity can be especially important. Equity is the difference between the value of your property and what’s left that you owe. Our mortgage brokers in Arundel and Broadbeach will determine your current borrowing power based on the amount of useable equity you’ve built up in your property. You may be pleasantly surprised at how much this might be!

Also, with the 20-plus lenders that our team has access to, we will help you find the home loan options that will fit with your needs, save you money and make your equity work as hard as possible for you.

Rental income from your investment could cover most of your repayments

Since many suburbs are still experiencing competitive rental markets even in the wake of the Covid-19 pandemic, this can put you in an excellent position to keep your old property and not sell when you move.

If you do decide to keep your previous property as an investment, it’s common to be required the lender to provide proof from a Real Estate Agent of what that property is expected to rent for. Our Broadbeach and Arundel brokers can help with this process to determine what proportion of your repayments will be covered by your rental income.

You may even find that the anticipated rental income for your old property covers the majority of your additional home loan repayments. However, even if your investment property costs you a bit of money each month, you can take advantage of negative gearing at tax-time.

Find out about available investment property tax benefits

Tax benefits may actually give you a few more reasons to keep your old property, since you can claim things like investment expenses as tax deductions to help lower your payable tax.

You could also make tax claims against property depreciation when you have an investment property. Tax depreciation is the reduction in the value of your property and its fixtures overtime, such as carpets and window coverings. While, these items will gradually need to be updated, you can claim their depreciation each year without having to replace them.

Our Arundel and Broadbeach mortgage brokers can give you an idea of the tax-time advantages that an investment property can give you and we have reputable Tax Depreciation Specialists who can help you maximise your annual return.

We can structure ‘stand-alone’ loans for your investment and residence

Our Broadbeach and Arundel teams have also found that there can be advantages to mitigating any potential risks (no matter how small) posed by investing in property. There are options such as structuring each of your home loans to be independent, in order to reduce risks for you if the market happens to change down the track.

Let us help you buy a new property and turn your home into a savvy investment

Our teams at Mortgage Choice in Arundel and Broadbeach can help you form a strategy that fits your budget, circumstances and helps you grow wealth for the future. We will help you work through the process of purchasing your next home while keeping your existing property and as-always our service is at no cost to you.

Contact your mortgage broking teams in Broadbeach and Arundel for a no-obligation appointment to discuss all your options. Call 07 5676 6433 for Mortgage Choice in Broadbeach and 07 5594 6746 for our Mortgage Choice in Arundel office. You can also book a free, no-obligation appointment online with one of our mortgage brokers directly at our locations - click to book for Broadbeach and Arundel.