It's a personal question that only you can really answer.

If you've decided to forego a nicer PPOR in order to utilise more of your income on IPs then have you considered the option of renting rather than owning?

Cheers

Jamie

Is that the one which featured a story on a guy who bought places in North Adelaide for next to nothing in the 60s and 70s?

Cheers

Jamie

Hi Anthony

Congrats on the first purchase and welcome aboard.

Signing up to this forum will provide you with a wealth of free, up-to-date information. There's also a heap of good books that will keep you busy.

Feel free to ask anything.

Cheers

Jamie

Do you think there's a chance that your next PPOR will one day turn into an IP? If so, you don't want to repeat the same mistake so I'd place an offset account against the loan (new PPOR loan) and place additional savings into that (rather than paying down the principle).

Cheers

Jamie

Hi Gary

I would be worrying about if they're applying interest to it.

Tell them to sort it out or you'll seek legal advice – just sounds like a lazy body corp to me.

Cheers

Jamie

Whether it's over supply or confidence depends on the area.

There's quite a few OTP developments in Canberra at the moment. While the boom in OTP properties stemmed from increased demand – it's been overcooked now and there's an over supply.

Cheers

Jamie

Hi rsubax72

Will this property be a PPOR forever or is there a chance you may turn it into an IP down the track?

I know it may be hard to determine now but it's an important question.

Stop shopping around with multiple banks! Each of them are probably submitting a preapproval which is ending up on your credit report.

Cheers

Jamie

Well done!

How much did it end up selling for? Do you know what type of buyer purchased it?

Cheers

Jamie

Hi Synergism

Welcome aboard.

Terry's right – some careful planning and correct advice from the start would have saved you quite a bit of money.

Back to your question though. It sounds like you've already done the calculations on holding costs and have recognised that you can't afford to purchase a new PPOR in the inner west. On that basis, I…[Read more]

Agree with the other guys – excel all the way.

Just set up a sheet for each IP with expenses captured on one side and income captured on the other. The total expenses and income from each IP can then feed into a summary page that shows your total expenses and income.

Cheers

Jamie

Agree with Terry – have mutual clients and all have been happy.

Cheers

Jamie

Qlds007 wrote:

Ohhh i have just noticed i have become a "property enthusiast".

lol – it's an understatement for a guy who owns an IP or two.

Cheers

Jamie

Hi Dave

There's a difference between actual equity and useable equity.

If your property is worth $1m and you have a loan of $700k – then the actual equity is $300k.

However, banks won't allow you to borrow up to 100% of the properties value – most will allow you to borrow up to 80% and some as high as 90%

So if you could take your loan up to…[Read more]

Thanks for the kind words Jac M

Jac M is spot on with maximising deductible debt.

Is your current loan set up as interest only or principle and interest?

If you're looking to purchase a number of IPs in the future, I'd look to spread your $130k over multiple IPs using smaller deposits – but this is a broad statement and I have no knowledge of…[Read more]

Hi there

I don't understand the $30k part? Is your friend saying that he/she will sell it to you at a discounted price or is there some sort of rebate?

Cheers

Jamie

Hi Mich

Welcome aboard.

In regards to selling your current home – that's only a question you can answer. Is their anything that suggests it could be a good investment over the longer term?

With buying a "stepping stone" type property (ie. live in and then rent out) it's important to set your loan up correctly from the start so you don't pay…[Read more]

Hi Luke

Other options to explore include spousal transfer (is possible) or sell the property to another entity like a trust. I'm not sure of what's involved in WA when it comes to either of these – but no doubt there will be costs, it's just a matter of weighing up whether it's worth it or not.

Cheers

Jamie

Hi Luke

Welcome aboard.

To determine whether a loan is tax deductible we need to apply the purpose test.

What is the purpose of the loan? If the increased borrowings are going towards your new PPOR, it won't be deductible.

However, the current debt against your property should be once it turns into an IP (providing all the redrawing of cash…[Read more]

Dave@PI wrote:
Jamie, is sub 6 with offsets? I had a bit of a look around and anything that low didn't seem to have 100% offset. Come to think about it, I'm not really sure if  I am 100 %

Cheers

Dave

Yes.

Cheers

Jamie

Hi Dave

If you want to reduce your repayments to improve your cashflow then just convert to interest only and make additional payments into an offset account rather than paying down the principle.

You can get a much better rate than what you have now. There are also some lenders that will provide you with a cash rebate to cover some (if not all)…[Read more]