Pharmacy assistants looking to build wealth through property investment often find units and apartments an attractive entry point into the real estate market. These properties typically require a lower initial investment compared to stand alone dwellings, making them suitable for first investment property purchases.
Understanding Investment Loan Options
When buying an investment property, you'll need to access investment loan options from banks and lenders across Australia. Investment property loans differ from owner-occupier loans in several key ways:
• Higher interest rates compared to home loans
• Stricter lending criteria and borrowing capacity assessments
• Different loan to value ratio (LVR) requirements
• Potential lenders mortgage insurance (LMI) requirements above 80% LVR
Most lenders offer both variable interest rate and fixed interest rate options for investment loans. Variable rates fluctuate with market conditions, while fixed rates provide certainty for a specified period.
Determining Your Borrowing Capacity
Your borrowing capacity depends on several factors that lenders assess during the investment loan application process:
- Income stability - Regular pharmacy assistant wages provide steady income
- Existing debts - Credit cards, personal loans, and other commitments
- Living expenses - Your monthly spending requirements
- Rental yield potential - Expected rental income from the investment unit
- Property type - Town house, apartment, or unit specifications
Lenders typically require recent bank statements, payslips, and tax returns to verify your financial position. The application process involves detailed scrutiny of your capacity to service both the investment loan repayments and your existing financial obligations.
Ready to get started?
Book a chat with a Finance & Mortgage Broker at Pharmacist Home Loans today.
Research Property and Market Analysis
Before applying for an investment loan, thorough research property analysis is crucial. Consider these factors when evaluating potential investment units:
• Location and proximity to transport, schools, and amenities
• Rental demand in the area
• Capital growth potential
• Body corporate fees for apartments and units
• Maintenance and management requirements
The property market varies significantly across different suburbs and states. Units in well-established areas often provide more stable rental yields and capital growth prospects.
Investment Loan Interest Rate Considerations
Investment loan interest rates are typically higher than owner-occupier rates. However, you may qualify for interest rate discounts based on:
• Loan amount and LVR
• Your relationship with the lender
• Professional package eligibility
• Loan features selected
Calculating investment loan repayments should include both principal and interest components, along with property-related expenses such as rates, insurance, and body corporate fees.
Tax Benefits and Negative Gearing
Many pharmacy assistants utilise negative gearing as part of their property investment strategy. This occurs when your rental income is less than the total costs of owning the investment property, including:
• Loan interest payments
• Property management fees
• Maintenance and repairs
• Council rates and insurance
• Depreciation allowances
The resulting loss can be offset against your pharmacy assistant income, potentially reducing your overall tax liability.
Streamlined Application Process
Working with experienced mortgage brokers can provide access to a streamlined application process. Professional brokers understand various lenders' criteria and can match your circumstances with suitable investment loan options.
Key documents typically required include:
- Employment verification and payslips
- Bank statements showing savings and spending patterns
- Tax returns and notices of assessment
- Details of existing assets and liabilities
- Property purchase contract (once identified)
Additional Costs to Consider
Buying a rental property involves several upfront costs beyond the loan amount:
• Stamp duty (varies by state and property value)
• Legal fees and conveyancing
• Building and pest inspections
• Lenders mortgage insurance (if LVR exceeds 80%)
• Loan establishment fees
These costs can add significantly to your initial investment, so factor them into your property investment strategy planning.
Building Your Investment Property Portfolio
Starting with an investment unit can be the foundation for building a larger investment property portfolio. As your equity grows and rental income increases, you may be able to leverage this position for additional property investments.
Successful property investors often start with one well-researched investment property and gradually expand their portfolio over time, using a combination of capital growth and rental income to fund subsequent purchases.
As a pharmacy assistant, your steady income and professional status can work in your favour when applying for investment loans. Lenders generally view healthcare workers as lower-risk borrowers due to job security and stable income prospects.
Call one of our team or book an appointment at a time that works for you to discuss your investment property loan options and start your property investment journey.
