Best way to buy 2nd house

Discussion in 'Investment Strategy' started by rainbows, 5th Jun, 2021.

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  1. rainbows

    rainbows New Member

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    I recently bought a $1.8M house in Sydney and discussing loan options with broker. I need to borrow $0.8M to complete the purchase. My borrowing power is ~$1.2M. I would like to buy a house on the Central Coast within a year after settlement.

    Option 1: Get a $1.2M loan, spend $0.8M on the Sydney house. Use the remaining $0.4M + use equity / another loan to buy 2nd house.

    Option 2: Get a $0.8M loan for Sydney house. Use equity / separate loan to buy 2nd house.

    Any advice on whether these plans are realistic / which is the better option? Thanks! :)
     
    rainbows, 5th Jun, 2021
    #1
  2. Trainee

    Trainee Well-Known Member

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    Did you ask your broker what your borrowing capacity would be after you buy the first house?
     
    Trainee, 5th Jun, 2021
    #2
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  3. rainbows

    rainbows New Member

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    No. I thought this depended on the loan amount I took out?
     
    rainbows, 5th Jun, 2021
    #3
  4. Sackie

    Sackie Well-Known Member

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    You know the saying about assumptions......
     
    Sackie, 5th Jun, 2021
    #4
  5. Trainee

    Trainee Well-Known Member

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    sure but the broker can run scenarios. At least check that what you are thinking of are in fact possible?
     
    Trainee, 5th Jun, 2021
    #5
  6. rainbows

    rainbows New Member

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    Ok I'll check with my broker and post with update :)
     
    rainbows, 5th Jun, 2021
    #6
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