Building a property portfolio doesn’t always mean saving for years to fund a new deposit. If you already own a home or investment property, you may be able to use the equity in that property to finance your next build, without dipping into your savings.
At DDP Projects, we help everyday Australians unlock the potential of their existing property and strategically use equity to grow wealth through smart investments. Here’s how it works.
What Is Equity?
Equity is the difference between the market value of your property and the amount you still owe on your home loan.
For example:
- Property value: $700,000
- Outstanding loan: $400,000
- Available equity: $300,000
Not all of this equity can be used, but lenders will often allow you to access up to 80% of your property’s value (sometimes more, with LMI), minus what you still owe. This is called usable equity.
Why Use Equity for a New Investment Property?
Using equity allows you to leverage your current property to fund a deposit, construction costs, or even the full build of a new investment. The benefits include:
- No need for a cash deposit
- Faster portfolio growth
- Maximised borrowing power
- Better use of idle capital
- Potential tax benefits for investors
It’s one of the smartest strategies to build wealth through property, especially when combined with high-growth locations and the right build type.
How to Access and Use Your Equity
Here’s a step-by-step overview of the process:
1. Get a Property Valuation
Lenders require a professional valuation to determine how much equity is available. The higher the market value, the more equity you can potentially use.
2. Calculate Usable Equity
Generally, lenders allow borrowing up to 80% of your property’s value, minus your existing loan.
Formula:
(80% of property value) – loan balance = usable equity
3. Choose a Finance Strategy
There are several ways to access your equity:
- Top-up loan: Increase your current loan
- Equity release loan: Access equity as a separate loan
- Line of credit: Flexible funds that you can draw on as needed
Your finance broker or advisor can help structure the best option based on your goals and borrowing capacity.
4. Use the Equity as a Deposit
Once approved, your equity can be used as the deposit for your next investment property—often covering the upfront costs of a new house and land build, a duplex, or dual occupancy project.
Using Equity with DDP Projects
At DDP Projects, we specialise in helping clients build their portfolios using equity, without overstretching their finances.
We’ll help you:
- Assess your equity and borrowing power
- Secure pre-approval through DDP Finance
- Select high-growth build locations across Australia
- Choose the right investment property design for your goals (turnkey home, dual living, duplex, etc.)
- Coordinate the build process, from land to handover
You stay in control, while we manage the details.
Common Questions About Using Equity
Can I use equity from an investment property?
Yes. Equity can be accessed from any property you own, including rentals or your primary residence.
Will my repayments increase?
Using equity increases your overall loan balance, which may lead to higher repayments. However, if your new property is rented out, the income can help offset those costs.
What are the risks?
Property markets can fluctuate, so it’s important to invest in the right areas with strong growth and rental demand. That’s where expert guidance is key.
Final Thoughts
Your current property could be the key to funding your next one. By unlocking and leveraging equity, you can build a stronger portfolio, generate more income, and accelerate your path to financial freedom—without needing years of savings.
Want to find out how much equity you can use? Speak to the team at DDP Projects and start planning your next investment today.