Finance for property development can be a complex and confusing topic for many property developers or investors. It’s important to understand the differences between property developing and property investing when it comes to finance. There is one common question that property investors often have: how can they finance a property development when they have limited serviceability but sufficient equity?

 

Many people who are new to property development may not fully understand how finance works in this context. They may be familiar with obtaining loans for their primary residence or investment properties, where serviceability is a key factor in determining loan approval. Serviceability refers to the borrower's ability to repay the loan, typically demonstrated through income verification and financial statements.

 

In this week’s episode, Hilary and Bob discuss how you can finance a property development. They highlight the common confusion between property developing and property investing when it comes to finance. They also share insights and tips to help property investors navigate the complexities of financing property development successfully. So if you feel confused about the difference between property development and investing when it comes to finance, you won’t want to miss this week’s episode! 

Resources: 

 

To learn more about our Joint Ventures Workshop we have coming up, please click here: https://www.propertymastermind.com.au/joint-ventures-workshop/

 

Or to speak with us directly, click here: https://www.propertymastermind.com.au/schedule-an-appointment/

Episode Highlights:

 

• Common Confusion: Property Development vs. Property Investing [01:56]

• Understanding Retail vs. Commercial Finance [03:37]

• Tapped Out Investors and Serviceability Issues  [05:54]  

• Equity and Serviceability in Property Development  [08:18]  

• Capitalized Interest in Commercial Loans  [10:04]

• Accessing Equity in Principal Place of Residence (PPR) [12:00] 

• Using Unencumbered Property as Equity  [14:25]

• Using Investment Properties as Equity  [17:01]

• Joint Venture Workshop Announcement [19:13]

• Advice for Aspiring Property Developers [22:00]

• Encouragement and Final Thoughts [26:07]

 

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