Real estate investment property loans boost home mortgage lending

Many homeowners are considering moving into the property investment market for the first time as property rental yields rise.

Growing a property portfolio is easier with the right mortgage finance

The mortgage lenders have always had some great mortgage loans tailored to the person that wants to build a property portfolio. Equity home loan portfolio mortgage products developed in the 1990’s by CitiBank, St George Bank,  State Bank [the Viridian now offered by CBA], Adelaide Bank [now merged with Bendigo Bank] and many non bank lenders  including building societies and are a great alternative, but not necessarily the better alternative to the fixed interest rate, interest only home loan traditionally favoured by property investors.

The Real Estate Investment Opportunity

Besides higher rentals, and lower mortgage rates, lower buy in prices have been achieved in some areas, but this is unlikely to present for much loanger as median house prices in the capital cities have stabled or even grown.

But there is plenty of growth left to go.

Many predict Housing property value growth, for instance that Canberra will grow by 17 per cent, Brisbane by 16 per cent, Gold Coast 14 per cent, Perth by 12 per cent and Darwin by 11 per cent over the next 3 to 5 years years.

I personally favour the evergreen, revolving line of credit, portfolio equity home loan package as the way to manage a growing property investment portfolio, but individuals need to get financial advise on the personal situation before they make any selection of mortgage loan finance.

Portfolio equity home loans can allow from maximums 6 to as many as 12 sub-accounts, with interest options of fixed, variable, interest only and in different borrower names, to maximise any negative gearing tax benefits. These accounts also make the management of the tax aspects of the investments easier to sort.

Author: Rick Adlam for Mr Mortgage