Smart Ways to Approach Rentvesting as a Concreter

Rentvesting lets you own property without locking yourself into living somewhere that doesn't suit your work.

You buy an investment property where the numbers stack up, keep renting where you need to be for your concreting jobs, and claim the costs against your tax. The appeal is financial rather than lifestyle. You get into the market without committing to a suburb that might be two hours from your regular sites or paying inner-city prices when you spend half your time in the ute anyway.

The lending side works differently to an owner-occupied loan. Lenders assess investment loans on rental income as well as your own, but they also apply stricter buffers and lower borrowing limits. If you're planning to rentvest, you need to understand what lenders will actually fund and what the tax changes from mid-2026 mean for your numbers.

Why Concreters Often Look at Rentvesting

You work where the jobs are. That might be residential subdivisions on the fringe one month and commercial sites closer to the city the next. Buying a home in one fixed location often means either overpaying to be central or spending hours each week in traffic.

Rentvesting separates the decision. You can rent near current job sites or in an area that suits your lifestyle, and buy investment property in a suburb with stronger rental demand and lower entry prices. The rent you pay is not tax deductible, but the mortgage interest, depreciation, and other holding costs on the investment property are. For someone pulling decent income through a company or as a sole trader, that deduction reduces your taxable income and smooths out cash flow during quieter months.

Another angle is deposit size. Saving 20 per cent to avoid Lenders Mortgage Insurance on a property you plan to live in takes time. Rentvesting in a lower-priced suburb can get you into the market sooner, even if you're still paying LMI on a smaller loan amount, because the actual dollar figure required up front is lower.

How Investment Loan Serviceability Differs from Owner-Occupied

Lenders add rental income to your application, but they don't count all of it. Most apply a shading factor of 75 to 80 per cent to allow for vacancies and management costs. They also test your ability to service the loan at a rate roughly 3 percentage points above the actual product rate, which is the current APRA serviceability buffer.

Consider a concreter earning around $95,000 through a company and looking to buy a unit returning $420 per week in rent. The lender will assess roughly $315 of that weekly rent as usable income. If the loan amount sits at $450,000 on a variable interest rate, the lender tests serviceability at a notional rate over 6 per cent, even though the actual rate might be closer to 6.3 per cent. That assessment rate changes how much you can borrow compared to applying for the same loan as an owner-occupier.

Debt-to-income caps also apply. From February this year, lenders can only write 20 per cent of new investor loans at a debt-to-income ratio of 6 times or more. If your declared income is $95,000 and you're applying for a $600,000 loan, you're over that threshold, which means the lender needs capacity within that 20 per cent allocation or the application gets declined regardless of serviceability. Some lenders hit that cap early in the quarter. Others manage it across the year. Timing and lender choice matter more now than they did 18 months ago.

Interest Only Repayments and Cash Flow

Most investors choose interest-only repayments for the first few years. You're not paying down the principal, so the monthly repayment is lower and the cash flow gap between rent collected and loan cost narrows. The trade-off is that you're not building equity through repayments, only through any capital growth in the property value.

Interest-only periods typically run for one to five years, after which the loan reverts to principal and interest unless you apply to extend. Not all lenders will extend, particularly if your circumstances have changed or if the loan-to-value ratio has increased due to a market downturn. You need a plan for what happens when the interest-only period ends, either by refinancing, switching to principal and interest, or selling.

Interest only loans suit investors who want to maximise deductions in the early years and who expect income or equity growth to handle the higher repayment later. They don't suit someone relying on forced equity build-up to stay ahead of holding costs.

What Changed with Negative Gearing in Mid-2026

Negative gearing still exists, but the rules tightened for properties bought after 12 May 2026. If you buy an established dwelling from that date onward, any net rental loss can only be offset against other residential rental income or carried forward. You can't offset it against your wage or trading income the way you could before.

That change doesn't kill rentvesting, but it does shift the appeal toward properties that are closer to neutral or positive cash flow from the start, or toward new builds. New residential dwellings built on previously vacant land, or builds that increase the dwelling count on a site, remain fully deductible under the old rules. That means a house-and-land package in a growth corridor or a new townhouse in an infill development still lets you offset losses against salary or business income.

If you bought a property before 12 May 2026 or entered a contract before then, the old negative gearing rules continue to apply for as long as you hold that property. The transitional window closed on 30 June 2027, so anything purchased between May 2026 and June 2027 had limited time under the old settings.

Anyone rentvesting now needs to model the investment assuming rental losses stay quarantined unless they're buying a qualifying new build. That puts more weight on capital growth and less on short-term tax relief.

Choosing Between Variable and Fixed Rates on an Investment Loan

Variable rates on investment loans sit higher than owner-occupied rates, usually by 0.3 to 0.6 percentage points depending on the lender and your loan-to-value ratio. Fixed rates are also higher for investors, and the discount for fixing is often smaller.

The decision comes down to cash flow predictability versus flexibility. A fixed rate locks in your repayment for one to five years, which helps with budgeting if you're managing lumpy income from contracts. The downside is that break costs apply if you want to pay down extra, refinance, or sell before the fixed term ends. For an investment property, you're less likely to make big lump sum repayments anyway, so fixing can make sense if you want certainty.

Variable rates let you access offset accounts, which can be useful if you're holding cash from a big pour or waiting on progress payments. The interest saved by parking funds in an offset reduces the loan cost without triggering a taxable event. Some investors split the loan, fixing part for stability and leaving part variable for flexibility and offset access.

Rate discounts depend on the loan amount and your equity position. Lenders offer deeper discounts on larger loans or where you're borrowing below 70 or 80 per cent of the property value. It's worth comparing investment loan options across a few lenders rather than assuming your current bank will offer the sharpest rate.

Borrowing While Self-Employed or Through a Company Structure

Most concreters operate as sole traders or through a company. Lenders want to see consistent income over at least one full financial year, preferably two. If you've recently switched from PAYG to a company structure, some lenders will assess you on the shorter timeframe, but expect a higher scrutiny on cash flow and declared earnings.

For self-employed loans, lenders typically assess your taxable income plus any add-backs like depreciation or one-off expenses that don't reflect ongoing cash flow. If you've been minimising tax by keeping declared profit low, that same strategy will reduce your borrowing capacity. You can't have it both ways.

Low-doc products exist but come with higher rates and lower loan-to-value ratios, usually capped at 60 to 70 per cent. They're a fallback if your tax returns don't support a full-doc application, but the cost over the life of the loan is significant. It's usually worth planning ahead and running a year or two of higher declared income before applying if you're serious about building a property portfolio.

What Happens When You Want to Buy a Home Later

Rentvesting is often a stepping stone, not a permanent strategy. At some point, you might want to buy a home to live in. The investment property doesn't stop you, but it does eat into your borrowing capacity.

Lenders assess your total debt, including the investment loan, when you apply for an owner-occupied loan. They'll give you credit for rental income, but as mentioned earlier, only 75 to 80 per cent of it. If the investment property is close to cash flow neutral, the impact is manageable. If it's negatively geared by $200 or $300 a week after accounting for shaded rent, that shortfall reduces what you can borrow for the next property.

Some people sell the investment property to free up deposit and borrowing capacity. Others hold it and accept a smaller budget for the owner-occupied purchase. The third option is to use equity in the investment property as part of the deposit for the next purchase, provided the combined loan-to-value ratio and serviceability still stack up. Equity release works well when the investment property has grown in value and you've built some buffer between the loan amount and the property's current worth.

How Rentvesting Fits with Long-Term Wealth Building

Property investment works on leverage and time. You control an asset worth several hundred thousand dollars with a deposit of 10 to 20 per cent, and you benefit from any capital growth on the full value, not just your deposit. The loan is a tool, not dead weight, provided the property grows and the holding costs don't drain your cash flow to the point where you can't sustain it.

Rentvesting lets you start that process without locking yourself into a location that doesn't suit your work or lifestyle. The tax settings are less favourable than they were a few years ago, but the fundamentals still hold. Rental income covers part of the cost, you get deductions on the rest, and over ten or fifteen years the property value should grow enough to justify the holding period.

The risk is buying in the wrong area or overpaying at the peak of a cycle. Location matters more for investment property than for a home, because you're not getting any lifestyle value out of it. You need rental demand, infrastructure, and a reasonable expectation of capital growth. Suburbs with strong employment, transport links, and affordable entry points for renters tend to perform better than areas relying on one industry or demographic.

If you're looking to expand your property portfolio over time, the first purchase sets the foundation. Get the structure wrong or stretch too far on borrowing, and the second property becomes much harder to fund.

Call one of our team or book an appointment at a time that works for you. We'll run the numbers on your income, work out what lenders will actually lend, and talk through whether rentvesting makes sense given where you're working and what you're earning right now.

Frequently Asked Questions