How could restricted borrowing change investing approach

I was thinking through the potential impacts on the limiting of the ability to buy multiple properties .

Firstly , there is only a small proportion of investors who buy multiple properties , however my assumption is that somersoft has a much higher percentage of these investors than normal .

At the extremes there would be two different profiles .

At one end you have someone who has high income , lots of equity in reserve , and their investing is for them fairly conservative .

At the other end you have someone on a low / average income who relies on frequent revaluations to draw down equity to buy further properties . Their buffer is reliant on these and they have to watch their money very closely . Obviously after with time their equity builds up as does their income from increasing rent , but they would be relatively rent reliant .

I think we have both of these styles of investors on the forum with many in between .

My assumption is that any changes in serviceability will have a significantly bigger impact on the later group , and probably not much on the first group.

So if you were in the second group and couldn't buy those 12 properties that you know you can afford ?

You could try and find people in the first group to borrow from . Could that be a new opportunity ?

Or you could try and maintain the rate at which your equity increases by chasing the next hot market .

Buying in Sydney when you see the market starting to move , selling as it peaks , then putting that equity in to Brisbane for the next 2-3 years ,selling up and moving on to Perth , where ever you see the next opportunity .

So instead of revaluing and drawing out equity , selling , paying tax and moving on . Will the changes in servicability lead to a more trading approach .

obviously you'd need to run the numbers to see if that actually generates more money after costs are deducted ,

Thoughs ?

Cliff

How could restricted borrowing change investing approach