NSW Property NOT selling in Sydney - Clearance rates below 50%!

Margin calls are specific to margin products. Not so when using home equity to purchase shares, no different to using said equity to purchase another property.

 

to some extent, YES.

when an investor doesn't have a cash buffer and property price declines sharply, it leads to fall in rental return, in result - repayments are much higher than rental returns, so an investor may be not able to make repayments - that is technically "margin call" for that investor

 

totally different beast IMHO - margin call -
Margin call is a demand.

With property bank loans you have control

 

'margin call' for property loan is a demand as well, but it is conditional and more flexibility (cash buffer, ability to increase income, ability to borrow, etc) and delayed in time.

 

You can take out a standard residential loan with a residential property as security for "investment purposes". I have done this twice. I could have done whatever I wanted with the loan funds: gone to Bali, put it all on red, bought Dick Smith shares, bought bitcoin, or invested in property. It went on property but if I have bought bitcoin instead, I would be filthy rich right now. My point is that these are not margin loans, they are normal residential loans and basically can't be called in.

 

secured against shares? not property?

 

A residential property is the security for the loan. Once the loan is set up I can buy shares.

I have a house. I use the house as security for a loan of $250,000. I use the funds to buy shares.

If the shares go up, great! If the shares go down, the bank won't hassle me because the loan is secured by a house. Does that make sense?

It's fairly easy to do. I have done it twice, except that I bought property, not shares with the loan funds.