How Much Can I Borrow for
an Investment Property?

Why investment borrowing is assessed differently

When you borrow for an investment property, lenders add the expected rental income to your total income — but they discount it. This shading, typically 70 to 80 per cent, accounts for vacancy, management fees, and maintenance. A property expected to generate $500 per week in rent might only be counted as $350 to $400 per week for serviceability purposes.

Lenders also apply a buffer rate to stress-test your repayments. If the loan rate is 6 per cent, the assessment might be done at 8.5 to 9 per cent. This buffer ensures you could still afford repayments if rates rose significantly. APRA requires a minimum 3 percentage point buffer, but some lenders apply more.

APRA DTI caps and what they mean for investors

In February 2026, APRA introduced a cap limiting banks from issuing more than 20 per cent of new home loans where the borrower's total debt exceeds six times their gross annual income. This debt-to-income (DTI) cap particularly affects investors who already have a home loan and are adding investment debt on top.

If your total debt (home loan plus investment loan) would exceed six times your income, some lenders may decline the application even if you pass their standard serviceability test. A broker can identify which lenders are still lending at higher DTI ratios and which treat rental income more favourably. Read more about APRA's DTI caps and what they mean for investors.

How to maximise your investment borrowing power

• Reduce existing debt — pay down credit cards and personal loans before applying. Lenders assess the full credit limit, not just the balance
• Choose the right lender — borrowing capacity can vary by $50,000 to $100,000+ between lenders for the same borrower. A broker identifies who treats your income and expenses most favourably
• Provide a strong rental estimate — a property manager's appraisal can result in a higher assessed rental income than generic market data
• Structure your loans carefully — interest-only on investment loans can reduce assessed repayments and improve borrowing capacity for additional properties

Read our full guide on how investment property loans work for the complete picture on rates, structures, and strategy.

Frequently asked questions