There’s no pattern – the only thing to remember is that it’s not a standard variable based product so they can offer enticing rates to new borrowers, whilst letting their back book (existing clients) rates float up to balance their costs.

The only way you can avoid this is via a SVR product, but then they might not be discounted as heavily but will be more consistent in cost.

I’d note that this doesn’t mean all non-SVR based loans are bad – there are a lot of great lenders which don’t structure their loans as SVR products but still have consistent good pricing.

Best thing is to speak to your broker – you should have a trusting relationship with them. If you feel you cannot trust their advice then this may be a symptom of other issues and you’ll need to work out whether this is for a genuine reason and need to look elsewhere, or just fear of the unknown.

BTW – the product has been sitting around the same pricing for near on 6 months so they have been consistent in the near term – whether this remains over the next 29.5 years of a loan term remains to be seen.

Logan is OK – net yields aren’t amazing (if existent at all!)

My concern with the council area in general is the council has actively noted that their development plan is to keep increasing land release from their extensive undeveloped areas to try stifle property value growth over the longer term – to try to keep the council region as affordable to low-middle incomes.

Unless you have substantial income elsewhere it is doubtful. Lenders are required by law to look at your overall financial situation and stress test any debts etc. This means that before even considering what your existing IP mortgage is – they will plonk living expenses of $24,000+ p.a they will want to see covered, only take 80% or less of the rent you receive, stress test the mortgage repayments of your mortgage by more than double etc.

If you do end up using a POA – make sure you keep the original POA document as this will generally be required to be provided to the lender during the finance process/prior to settlement. If you throw it out/scan and get rid of the original you can leave yourself in a pretty tricky spot.

I’m curious – are you saying you are looking to do a development which only requires 100-250k (talk about a range to begin with) in development costs to divide 56 allotments?

If you’re looking at finance you will definitely struggle in the current environment, with most lenders not wanting to take on first time developers at all – so you will have a limited range of funding partners who will consider this.

There’s quite a bit written about that product – in most cases you end up coming worse off than if you had an aggressively priced PPOR and IP debt. The big caveat is that you can only get as low as that interest rate if you have multiple times the amount of IP debt at a substantially higher rate to offset the interest saving.

Don’t worry about it too much then – the variety of commercial products at this time means that even should your serviceability be constrained with time, there’s freestanding products available through certain brokers accredited with commercial lending panels which can be used to allow you to continue purchasing without your existing portfolios dragging your borrowing capacity down.

Most people will run out of deposit funds before they run out of capacity.

Not the worst interest rate out there, but likely to be able to be improved depending on how you would like to have it structured. With the right lender you could get a an IO loan in the low to mid 4’s, else if it suits your strategy there’s P&I options at sub 4% at the moment.

To get the best bang for buck – have a chat with a broker who will be able to let you know what your existing lender should be able to offer you without having to move, and then compare that against options which may be available elsewhere.