How can you turn one property into two?

I had one of my clients call me recently to ask this very question and their new loans recently settled and they were so happy with the ease of how this worked so I thought I would share my thoughts.

One that only a few years ago I had helped them buy their first home and their story is amazing but for purposes of privacy, let’s call them Ren and Stimpy.

Ren called me and said “me and Stimpy have been talking. We really want to buy an investment property and we have no idea how to do this, can you please help?

All they needed to do was book in a meeting

I booked in a time to catch up with them both and when I did it was really nice to catch up with them as it had been 3 years since they purchased their first ever property.

Now mind you, when I helped them purchase their first owner occupied property 3 years ago – we really scraped the bottom of the barrel in terms of savings and only used the First Home Owners Grant or FHOG to get in.

They still have had to pay for stamp duty and just got into their first home at 95% inc LMI.

This means that they actually paid the most amount of Lenders Mortgage Insurance that they could because they had no other option.
In any case, they did what they had to do to get into the market. Let’s fast forward to today.

They had simply paid the minimum repayment for the past 3 years

At the meeting, Ren and Stimpy advised that they had simply paid the minimum repayment for the past 3 years and nothing more.

The good news for them was that their property had increased massively in value and thus were about to do a few things to put them in a much better position then they were currently in. Let’s crunch some basic math:

They built their first property for $457,000 and had an initial loan for $434150 which was 95% LVR inc LMI. Today their loan had reduced to $407,000 but their house value had increased to $757,000 in 3 years from their construction.

That’s an increase of $300,000 over the 3 years which is a 39% growth in their property or $100,000 per year since their construction finished.

Now this is where it gets interesting!

Their current out of pocket expense was $1650 which also included a personal loan that they had prior to buying their first home which was lingering around with an interest rate of 15% pa – ouch!

Anyway, $1650 is what they were paying for the last 3 years on their home loan.


I was able to get them approved for a new home loan for an investment property for a purchase price of $505,000.

This new investment loan would cost them $1362 per month for the interest only repayment.

However, with a new investment property under their belt they could earn another $415 per week of rental income. That’s a gross amount of $1798 per month.

This means that Ren and Stimpy’s new outgoing cost on all their debt is now $3012 however, the rental income that they can generate is gross $1798 per month.

This means that they now have a gross out of pocket expense of $1214. That mean that they can put this saving of $436 per month towards their current property and pay that down faster than before.

$436 may not seem like a lot but let’s multiply that by 12 months and we get $5232 and $52,320 in the next 10 years.

An extra $52,320 gross can go along way.

What would you do with that type of money?

This doesn’t even take capital growth or rental growth into the equation however; one must simply look at the last 10 years to get an idea of the growth that could potentially happen.

The beautiful thing here is that Ren and Stimpy are just 2 normal people.
One works as a tradie and the other works as a admin.

They are normal everyday Australians most like you right now.

Of course, just like anything, there is risk. There is always risk in anything that we do including driving a car each and every day. This is why we have insurance and something that you should always obtain.

Anyway, I digress. If you would like to investigate how you can achieve this then please reach out as I am here to help you.

Reach out using the below link and we will be in contact with you shortly.

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