the maximum amount I can borrow from bank

[Yan W.]

Dear wise members,

I'd like to buy a 2nd property in the city and will rent out the 1st suburb one if needed. Will the new mortgage depend on the 1st one already having stable rental income for certain amount of time? But I couldn't rent out the 1st one before I purchase the 2nd one. 

Many Thanks

[Barry H.]

YAN - I am not an expert in this area, but common sense would tell you a traditional bank will want to see you have rental income on your primary residence before lending on the NEW home in the City.  If you have enough income to support 2 mortgages, it is not an issue.  

One suggestion would be to get a roommate in your existing suburban property and have a lease in place (on paper) reflecting a reasonable amount of rental income to cover your mortgage, taxes and insurance on the suburban property (if you don't have enough income to afford 2 mortgages).  

My last piece of advice is if you can't rent out the suburban home for the amount of your loan, taxes and insurance (or more), you may want to think hard about buying that property in the City until after you SELL your suburban house.  :-)