Investment Property Finance, Independent and Free
Whether it's your first rental or you're growing a portfolio, we structure your lending to give you the best shot at long-term returns. We compare investment loan products across 25+ lenders, and our advice doesn't cost you a cent. The lender pays us if you go ahead.
How Much Deposit Do You Need for an Investment Property?
The deposit you need depends on whether you're buying an existing property or a new build.
The 30% deposit rule on existing investment property comes from the RBNZ's LVR speed limit, eased from 35% to 30% effective 1 December 2025. Banks can still lend a small portion of their new investor lending above 70% LVR, but that's case by case and not the norm.
That's a $70,000 swing. On top of that, new builds typically have lower maintenance, better tenant appeal, and come pre-compliant with Healthy Homes Standards.
Where does the deposit come from? Most investors don't use cash savings. The most common source is equity in an existing home (see the next section).
DTI restrictions you need to know about
Banks are limited to lending no more than 20% of new investor mortgages above a 7x debt-to-income ratio (your total debt divided by your gross annual income). Most banks will apply this as a hard cap when assessing you. It's a newer rule that catches some investors off guard. We factor it into your numbers from the start.
Using Your Home Equity to Buy an Investment Property
If your home has increased in value or you've paid down your mortgage, you likely have usable equity that can serve as your deposit.
How it works. Most NZ banks will lend up to 80% of your owner-occupied home's current value. The gap between that and what you currently owe is your available equity.
Having equity doesn't automatically mean you can borrow. The bank also needs to be satisfied you can service both your existing mortgage and the new investment loan at their test rate (Westpac's most recent publicly disclosed test rate is 6.85% p.a., following the May 2025 OCR cut). Banks also discount expected rental income when working out how much you can afford (we cover this in the FAQ below).
New Build vs Existing Investment Property
This is one of the biggest decisions for property investors. Here's how they compare under 2026 rules.
20% (LVR exempt).
30%.
Low, everything is new. Often a Masterbuild Guarantee.
Higher. Older homes need more upkeep.
Generally built to current standards.
May need upgrades to comply.
High, warm, dry, modern.
Varies by property.
Often lower (higher purchase price relative to rent).
Often higher (lower purchase price, similar rent).
Can be slower initially (you pay a new-build premium).
Potential for renovation or development upside.
100% deductible (always was).
100% deductible (restored from 1 April 2025).
2 years.
2 years.
Higher (newer chattels, fittings).
Lower.
Limited to where new builds are available.
Full choice of suburbs and areas.
There's no universally better option. It depends on your deposit, goals, and risk appetite. New builds get you in the door with less deposit and less hassle. Existing properties in established suburbs can offer stronger yields and more upside through renovation. We'll model both scenarios for your situation.
Understanding Rental Yield
Rental yield tells you the return you're getting from rent relative to the property's value. It's one of the first numbers most investors look at.
What's a "good" yield?
It depends on what you're optimising for. Higher yield isn't automatically better. High-yield areas often have weaker capital growth and higher vacancy risk. Where your property sits on this spectrum shapes the whole strategy.
Gross vs net yield
Gross yield ignores costs. Net yield is what actually lands in your pocket after the property's real expenses come out of the rent.
Gross yield ignores costs. Net yield is what you actually take home after:
- Rates
- Insurance (house and landlord)
- Maintenance
- Property management fees (7 to 10% of rent)
- Healthy Homes compliance costs
- Mortgage interest
- Vacancy periods
Tax on Investment Property, What Changed in 2025 and 2026
Two big tax changes have made property investment materially more attractive since 2024.
From 1 April 2025, you can deduct 100% of mortgage interest on residential rental properties from your rental income for tax purposes. This was phased back in after being progressively removed under the previous government.
New builds were always exempt from the interest limitation rules, so they sat at 100% throughout.
On a $500,000 investment loan at 5.5% interest, you're paying $27,500/year in interest. At 100% deductibility and a 33% marginal tax rate, that's $9,075/year more in your pocket compared to when deductibility was at 50%.
If you sell a residential property within 2 years of buying it and it isn't your main home, any profit is taxed as income at your marginal tax rate. After 2 years, the bright-line rule no longer applies (though other property-tax rules may still catch specific situations, like speculation or intent to resell).
You can't use losses from your rental property to reduce tax on your other income (salary, business, etc.). Rental losses are "ring-fenced" and can only be carried forward to offset future rental income or gains. These rules have been in force since 1 April 2019.
The main deductible expenses against rental income are:
- Mortgage interest (now 100% as above)
- Council rates
- Insurance (landlord and house)
- Property management fees
- Repairs and maintenance (genuine repairs, not improvements)
- Depreciation on chattels (not the building itself)
- Advertising for tenants
- Accounting fees for rental returns
- Body corporate fees
There's a clear line between repairs and improvements: repairs are deductible in the year you incur them, while improvements get capitalised. If you're mid-renovation, it's worth checking the boundary with your accountant.
Important. We're mortgage brokers, not tax advisers. We'll help you structure the loan. Talk to an accountant for advice specific to your situation.
Investment property questions
The ones we hear most from first-time landlords and growing portfolios.
Sebastian Pierce
Director & Principal Mortgage Adviser
Seb set up Simpler after a 10-year career working within the banking and finance industry. His deep knowledge of how banks operate, combined with a genuine passion for helping people, makes him an exceptional adviser.
With a Bachelor's in Finance and a Masters of Engineering Management, Seb is often referred to as the 'go-to guy' for all things finance. Whether it's investing in the markets or property, he loves talking shop.
Ready to Talk Investment Lending?
Whether you're buying your first rental or adding to a portfolio, we'll structure your finance to get the best deal across 15+ lenders. Free, independent, and ongoing. In a 15-minute chat we'll cover:
- How much equity you can release as deposit
- Whether new build or existing fits your numbers better
- Where you sit against the 7x DTI cap
- How to structure the loan for tax and cash flow
