Should You Buy an Investment Property in 2026?

The Mortgage People Insights

Should You Buy an Investment Property in 2026?

Buying an investment property can be an exciting step, but deciding when to buy is often where people get stuck. Here's what Australian property investors should consider before making their next move.

Quick answer

There is no perfect year to invest. The better question is whether buying an investment property makes sense for your borrowing power, cash flow, deposit or equity position and long-term goals right now.

Should you buy now? Wait for interest rates to change? Hold off to see what happens with property prices? Build a bigger deposit first?

There will always be reasons to wait.

Property markets move. Interest rates change. Lending policies evolve. Headlines can shift from optimism to uncertainty in the space of a week.

Rather than trying to predict exactly what happens next, there is a more useful question to ask.

The question that matters Does buying an investment property make sense for your financial position right now?

For some Australians, 2026 may be the right time to take that next step. For others, spending another six or twelve months strengthening their financial position could make more sense.

The important part is knowing the difference.

At The Mortgage People, we believe that starts with understanding your borrowing power, deposit or equity position, likely repayments and the different finance options available to you.

Is 2026 a Good Time to Buy an Investment Property?

There is no single answer that applies to every investor.

A strong property market doesn't automatically mean you should buy. A slower market doesn't automatically mean you shouldn't.

Your own circumstances matter.

How much can I realistically borrow?

How much deposit or usable equity do I have?

What will my repayments look like?

Can I comfortably afford the ongoing costs?

What happens if my expenses increase?

Does this purchase fit my long-term goals?

Those questions tell you far more about whether you're ready to invest than a property-market headline ever will.

If you're not sure of the answers yet, that's completely normal. Understanding your investment loan options before you start seriously looking at properties can give you a much clearer idea of what is realistic.

Should You Wait for Interest Rates to Come Down?

This is one of the biggest questions prospective investors ask.

Common thinking “I'll wait until rates come down and then I'll buy.”

The difficulty is that nobody knows with certainty when rates will move or what the property market will look like when they do.

Lower interest rates could improve borrowing capacity and reduce repayments. They could also influence buyer demand and property prices.

That doesn't mean you should rush into the market before rates change. It means interest rates shouldn't be considered in isolation.

A more useful approach is to understand whether the numbers work under current conditions. What would your repayments look like today? Would you still be comfortable if expenses increased? Is there enough room in your budget to absorb an unexpected cost?

If an investment only works on the assumption that interest rates will fall considerably, that's worth knowing before you commit.

Related insight What the Latest Inflation Figures Mean for Interest Rates and Your Mortgage →

How Much Can You Borrow for an Investment Property?

Knowing your borrowing power before you start searching can save a lot of frustration later.

Your borrowing capacity isn't based on income alone. Lenders may consider your income, expenses, existing mortgage, other debts, credit card limits, dependants, deposit or equity position and expected rental income.

Something many borrowers don't realise is that different lenders can assess the same person differently.

Lenders have their own credit policies and assessment criteria. The amount one lender is prepared to offer can therefore differ from another.

Before spending every Saturday walking through open homes, it's worth getting a clearer understanding of your investment property borrowing power .

How Much Deposit Do You Need for an Investment Property?

The 20% deposit gets talked about a lot, but it isn't a universal rule for every investment property borrower.

Your deposit requirements will depend on your circumstances, the lender, the property and the amount you want to borrow.

Some borrowers may have options with less than a 20% deposit, although Lenders Mortgage Insurance (LMI) or other considerations may apply.

Remember to think beyond the deposit. Costs may include:

• Stamp duty
• Conveyancing
• Building and pest inspections
• Loan-related costs
• Insurance
• Other property purchase expenses

Another useful question is how much money you'll have left after settlement. Putting every available dollar into the purchase may leave very little room for unexpected expenses.

Could You Use Equity to Buy an Investment Property?

Existing homeowners may be in a very different position from someone who doesn't already own property.

If your home has increased in value or you've reduced your mortgage balance, you may have built equity.

In simple terms Equity = Property Value − Loan Balance

Having equity doesn't automatically mean all of it is available to use. Your lender will still consider your income, existing debts, property value and ability to service additional borrowing.

For eligible homeowners, usable equity may potentially help fund part of an investment property deposit or associated purchase costs.

Using equity also means taking on additional debt, so understanding the numbers and how the lending is structured is important.

Already own a home? Learn about refinancing and accessing equity →

Should You Refinance Before Buying an Investment Property?

Not automatically.

Reviewing your existing mortgage before investing can still be worthwhile. Plenty may have changed since you originally took out the loan.

• Your property value may have increased.
• Your mortgage balance may have reduced.
• Your income may have changed.
• Your goals may now include property investment.

A home loan review can help establish whether your existing rate remains competitive, whether you have usable equity and whether your current loan structure still fits what you're trying to achieve.

Sometimes refinancing may make sense. Sometimes staying exactly where you are will be the better option.

Learn more about refinancing your home loan before taking the next step.

The Cheapest Investment Loan Isn't Always the Right Investment Loan

Interest rate matters. It just isn't the only thing that matters.

Interest Only or Principal and Interest?

Interest-only repayments generally cover the interest charged for an agreed period without reducing the principal balance. Principal and interest repayments gradually reduce the amount borrowed.

Offset Account

An offset account may allow money held in a linked account to reduce the loan balance used to calculate interest. Whether you need one depends on how you intend to manage your money.

Fixed or Variable?

A fixed rate can provide greater repayment certainty for a period. A variable loan may provide different features and flexibility. Neither is automatically better.

What About Your Next Investment?

If your goal is eventually to own more than one investment property, today's lending decisions may affect your future options. The right structure should consider more than simply getting this purchase across the line.

Explore your options See how The Mortgage People help with investment loans →

What Does an Investment Property Really Cost?

Your mortgage repayment is only one part of the cost of owning an investment property.

• Council rates
• Water charges
• Landlord insurance
• Property management fees
• Repairs and maintenance
• Body corporate or strata fees
• Periods without a tenant
• Land tax where applicable
• Unexpected repairs or expenses

Rental income can help offset these costs, but it's worth looking beyond the weekly rent when deciding whether an investment is affordable.

What happens if the property is vacant for a few weeks?

What happens if the property suddenly needs a major repair?

What happens if repayments or household expenses increase?

How much financial breathing room will you have after settlement?

You can use The Mortgage People's home loan calculators to explore repayments and other numbers before making a decision.

Five Mistakes to Avoid When Buying an Investment Property

1

Waiting Forever for the “Perfect” Time

There will always be another property forecast or interest-rate prediction. Your own financial readiness is something you can actually understand.

2

Finding a Property Before Understanding Your Finance

Understanding your borrowing position first gives you a realistic buying range before emotion enters the decision.

3

Borrowing the Maximum Just Because You Can

The maximum a lender may approve isn't necessarily the amount you're personally comfortable repaying.

4

Focusing Only on the Interest Rate

Rate matters, but lender policy, fees, flexibility, features and loan structure can also influence the right option.

5

Forgetting That Property Ownership Comes With Surprises

Tenants move out. Hot-water systems break. Strata levies appear. Building breathing room into your finances can make investing much less stressful.

What Should You Know Before Making an Offer?

Your Borrowing Power Know what you may realistically be able to borrow.

Your Contribution Understand how much cash or equity you'll need for the deposit and costs.

Your Repayments Know what the loan could cost and whether repayments fit your budget.

Your Loan Options Understand which lenders and structures may suit your circumstances.

Having those answers won't tell you which property to buy. It will help you make property decisions with a much clearer understanding of the finance behind them.

Should You Speak to a Mortgage Broker Before You've Found a Property?

You don't need to wait until you've found a property to speak with us.

In many cases, having the conversation earlier can be more useful.

A perfectly good place to start “I'm thinking about buying an investment property, but I don't know what's possible yet.”

We can help you understand your borrowing power, deposit or equity position and suitable lending options before you begin making offers.

Learn more about working with an Investment Loan Broker on the Gold Coast .

So, Should You Buy an Investment Property in 2026?

There isn't a simple yes or no.

The right time to buy an investment property is when the investment makes sense for your financial position and your goals.

Understand what you can borrow, what you'll need to contribute, what the property will cost to hold, how the loan might be structured and whether you're comfortable taking on the additional debt.

If those numbers make sense, it may be worth exploring what's possible. If they don't, waiting isn't necessarily a bad outcome.

Sometimes the smartest investment decision is knowing you're ready. Sometimes it's knowing you're not ready yet.

Frequently Asked Questions

Is 2026 a good time to buy an investment property in Australia?

There isn't one answer for every investor. Your borrowing power, deposit or equity, cash flow and long-term goals can be more important than simply choosing a particular year to invest.

Should I wait for interest rates to fall before buying?

Not necessarily. Lower rates could affect repayments and borrowing capacity, but other market conditions can change at the same time. Assess whether the investment works under current conditions rather than relying entirely on a future rate movement. Read our latest interest rate and inflation update .

How much can I borrow for an investment property?

Borrowing capacity depends on your income, expenses, existing debts, expected rental income and lender assessment criteria. Different lenders can assess borrowers differently. Explore our investment loan service to understand what may be possible.

How much deposit do I need?

Deposit requirements vary depending on the lender, property and your financial circumstances. A 20% deposit isn't necessarily required in every situation, although higher loan-to-value ratios can involve Lenders Mortgage Insurance or other considerations.

Can I use equity in my home to buy an investment property?

Potentially. If you've built sufficient equity, you may be able to access some of it to help fund an investment property purchase. Your income, existing debts, property valuation and lender criteria also influence what's available. Learn more about refinancing and accessing equity .

Is an interest-only loan better for an investment property?

Not necessarily. Interest-only and principal-and-interest loans have different advantages and considerations. The appropriate option depends on your circumstances, cash flow and investment goals.

Do I need to find a property before speaking to a mortgage broker?

No. Speaking with a broker before you find a property can help you understand your borrowing power, deposit requirements and potential repayments so you have a clearer buying range before making an offer.

Thinking About Buying an Investment Property?

Whether you're considering your first investment property, looking to grow your portfolio or wondering whether the equity in your home could help you take the next step, we can help you understand what's possible.

At The Mortgage People, we'll take the time to understand your goals, assess your borrowing position, compare suitable lenders and explain your options clearly.

No pressure. No obligation. Just clear advice.

Book a Free Call