Generally, you'll need at least 20% deposit (80% loan-to-value ratio) for the property purchase. This can come from your savings or equity from your existing home. You may need to pay lenders mortgage insurance (LMI) if your deposit's lower than 20%.

For eligible applicants, a 5% deposit^[#] (up to 95% loan-to-value ratio) with Lenders Mortgage Insurance on Principal & Interest repayments, could be an option. Speak with a home loan specialist to learn more.

Certain medical practitioners can apply for our LMI waiver with a min 5% deposit. And certain emergency services and healthcare practitioners, earning a minimum annual income of $90,000, can apply for our LMI waiver with a min 10% deposit.

• Home equity calculator
• Low deposit professions

It depends on your investment strategy, personal situation and appetite for risk. Property tends to have a long-term investment time frame. For example, some investors hold their property for more than 5 years to maximise return on investment.

Some indications you may need to adjust your plan:

• Your negatively-geared property isn't growing in value
• You make less than you spend on your investment property
• Opportunity cost: there are better investments out there
• You plan to retire/work less sooner than expected.

Moneysmart: investment timeframes

They generally have the same features, though there are some differences:

1. Investment home loans often have higher home loan interest rates compared to owner occupier home loans
2. An additional interest rate discount may be applicable for investors for paying 12 months interest in advance.
3. Investors can apply for up to 15 years of Interest Only repayments^[#] (it's 5 years for owner occupiers) as opposed to Principal & interest repayments.

All types of investing come with a level of financial risk, and investing in property is no different. So, it depends on your personal situation, investment strategy, risk appetite, and your level of experience.

Advantages of property investing:

• Capital growth. Property prices have shown good growth over the long-term, with less volatility than other investments like the stock market.
• Physical asset. You can renovate and add your personal touches to increase its value.
• Tax deduction. Your property's expenses may be offset against your annual taxable rental income - talk with your accountant or financial advisor.
• Passive income. The right property filled with quality tenants can generate a steady long-term income.
• Diversification. A property portfolio adds balance to your investment portfolio, protecting you against underperformance in any one asset class.

Property investing watchouts:

• Costs involved. Investment properties can be costlier than other investments, with high upfront costs like stamp duty, as well as other costs like a professional property manager and maintenance costs, Landlord Insurance and exit costs. For example, you may need to pay Capital Gains Tax when you sell - even if it's your holiday home - which could eat into your capital growth. Read more on investment property costs.
• Non-liquid asset. If you need to access money, you can't sell off a room. It takes a long time to sell and settle a property, unlike reselling other investments, like shares and managed funds - read more on using equity to invest in shares.
• Risk. You could overestimate market value, property prices could fall, and you could get into negative equity - where your property value is less than your loan amount.
• Interest rates. Investment home loans have higher rates than owner-occupied home loans. And interest rates could rise over the life the of your loan, increasing your repayments.
• Tenants. You're reliant on your property having good tenants - periods of vacancy or bad tenants can eat into your property income, and reduce your rental yield.