Unlocking Equity - the smart way to grow your property portfolio

Nov 11, 2025

3 min read

Thinking about building your investment property portfolio, but not sure how you’ll fund the deposit?

You might be sitting on the solution already, your home equity.

In today’s market, where saving a six-figure deposit can easily take years, using equity is one of the most powerful strategies available to Australian homeowners. Not only does it help you enter the market faster, it also positions you for long-term portfolio growth.

At Claremont Financial, we help clients every day unlock equity safely and strategically, so here’s a breakdown of how it works and what you need to consider.

What Exactly Is Equity?

Equity is simply the difference between your property’s current market value and your outstanding loan balance.

Example:

Property value: $900,000
Remaining loan: $500,000
Total equity: $400,000

But here’s the key part:

Lenders don’t let you borrow all your equity. They typically allow you to access up to 80% of your property value, minus your existing debt.

This is what we call usable equity, the portion you can actually tap into.

How Equity Can Fund Your Next Investment Property

Using equity for an investment property deposit can fast-track your wealth-building strategy. Here’s how it usually works:

1. Get a Valuation

A lender or your broker (us!) organises a valuation to confirm your property’s current value. Different lenders will value the same property differently so smart lender selection matters.

2. Calculate Your Usable Equity

Formula: (Property value × 80%) – existing loan = usable equity

This is the amount you can borrow without needing a cash deposit.

3. Access the Equity

This can be done through:

Increasing your existing home loan
A separate investment split
Or in some cases, a line of credit (less common today)

4. Structure It Correctly

This is where many get tripped up.

"Cross-collateralisation" which is tying multiple properties to the same loan can create unnecessary risk and limit future borrowing power.

At Claremont Financial, we avoid this unless there’s a very specific strategic reason.

Why Using Equity Can Be a Game Changer

Here’s why so many investors lean on equity to grow their portfolio:

✔ Faster Entry Into the Market

No need to spend years saving a deposit while prices keep rising ahead of you.

✔ Keep Your Existing Property

You’re building wealth without selling assets that are likely appreciating.

✔ Potential Tax Benefits

When structured correctly, interest on equity used for investment can be tax-deductible.

✔ Boost Long-Term Borrowing Power

A strong equity position makes the next purchase and the one after that far easier.

✔ Leverage Works

If your investments grow faster than the cost of borrowing, equity becomes your most powerful tool.

The Claremont Financial Approach - Strategy First, Lending Second

Too many people dive into investing without understanding structure, this is where we step in.

At Claremont Financial, we:

Assess your equity position
Model your borrowing power across multiple lenders
Show you what you can buy without hurting cash flow
Build a structure that protects tax efficiency and future borrowing power
Map out the next property and the one after that

Thinking About Your First (or Next) Investment Property?

Whether you’re just starting out or you’re planning your next acquisition, tapping into your equity could be the move that accelerates your portfolio.

If you want to explore it properly safely, strategically, and with the right structure we’re here to help.

Reach out to Claremont Financial and we’ll walk you through your options step by step.

Your next investment might be closer than you think.