Many people now are choosing to split their loan both ways, which allows you to pay extra off still on the variable portion if the lender is one (in the minority now I think) who does not allow extra payments on fixed rate loans.
You can answer it yourself easily. SUre , you do have to consider your aversion to risk, but really, think of this…..
* What is the lowest interest rate you ever have seen in Australia? When and for how long?
* What is the interest rates now?
* DOes it apeear likely they will increase again (most suggest inevitable) and anothe 2 or 3 times before they level off, and eventually start their trip down again (if they ever do)?
In the best case scenario, you could not see them ever dropping less than a full 1% (100 basis points) below what they are now – essentially your worst case scenario – but what is the worst they could rise?
Really, more importantly is to consider how long you plan to have your property for. Is it likely you will move or choose to , or need to sell in the next few years? If so, locking in a fixed rate is not such a good idea. If not…..well, sounds like a good idea.
The rest is up to you. All the best. 

Hi morty. I'll save you some money, anxiety, and it won't even be financial advice! If you are as you say 'treading water' perhaps you can relate to the thought ' it 's hard to arrive at your destination if you don't have one' or similar. May I suggest first writing down (yes I know it seems silly – years ago when I was in a position to have been quite constructive with a 'plan' my criteria was 'eat, buy a new car every year or two, and have a good holiday every now and then – and would have laughted at the suggestion I am making now! ) some goals you have, or what you want to achieve this year, nex year, and in five years time. Ten? bit serious fo now maybe. What do you want to achieve, and do you want to achieve it via real estate, or via r/E, shares, and other investments too? Going form no idea at all, to shelling out a grand or two for a full 'financial plan' is like hopping off your push bike and getting into a formula one car. There are some terrific financial planners, but please bear in mind, very few can legitimately advertise themselves as being 'independant' under current legislation.
Don't hesitate to get (ie pay for) direction as needed down the track, but ,maybe see how you go getting a bit of a vision/plan/goals meanwhile – and see how your spouse (if yo have one) feels about it too.
All the best.!

Welcome to the forum Tez? What sort of deposit do you have? A 30% deposit, or even 20% should be doable somewhere, but you need to ensure your default is shown up as paid – not unpaid. I must admit, if you have an unpaid default, and want to borrow 90 or 100% of the funds, you will indeed have difficulty, especially in the current economic climate. If you can easily afford the loan repayments, perhaps put them aside as savings for 3 to 6 months, which will increas your deposit, and of course show a savings history, although I am only speculation on your situation/finances without more detail
All the best. 

If you have a reasonable LVR, and are on a variable rate loan with your lender, (baa) depending on the size of the loan it may indeed be well worth looking at refinancing. Do the sums, or perhaps give us a bit of an idea what interest rate/loan size/property value you are talking about. Simons point on the tax variation is critical for heavily neg geared properties.

Have you got some good capital growth out if it to make up for the neg gearing or is it too early?

Cheers

Hi prusli. Unfortunately when it comes down to it, the rental income received and any market appraisels have very little if any to do with the actual property valuation, although a rental value is reported on in the val usually. Was it a full valuation – ie done inside the property? All that essentially is used is comparible sales of similar properties in that area.
 Unless you can prove yours is better in some way, or find some other comparible sales you will possibly be stuck. As a last resort, you could commission an independant val of your own for comparitive purposes.
All the best.

I guess it's not really free advice is it if thir 'structuring and investment' advice is to buy properties they get a commission for – in fact it could prove rather expensive I reckon. You will get good advice 'free' from any lender with an experienced staff member, or a good broker. Sadly banks, brokers, and other lenders do not always fall into the capable catagory, but you should be able to tell. So that part is free, and you can always employ a buyers agent too I guess if you are unsure of the actual property. That costs, but likley less then buying properties with commissions built in to the price – 'cos they are.  All the best.

Yep, this ones been discussed a few times now – O for a time machine eh? SOme people still claim you can guy properties like this, but not so. They are in piddly rural towns, mining towns, or require a lot of renno work, or are rented room by room. When this book was written, the yield on places like that would have been 50% probably! THe principles certainly still apply though. When you look at how quickly things can change on the 'world scene' (in a matter of weeks sometimes- ie US market, Rams collapse', Interest rates etc etc) you can't expect a book several years old to still apply when it comes to specifics such as pricing, yields, examples etc. Still, a great read, and as mentioned, if it gets you thinking outside the square, being creative, and helps start you on your investment journey, it has still served it's purpose.  AND   Welcome to the forum, 

If it did not involve anything illegal or dishonest, and did not cause anyone else any suffering…….no brainer. Go for it. Just do it Who dares wins etc etc.

Please excuse me dr. spock and others – but do feel the need to reply to the last post……..

1. …..wonder if people actually read the post, other comments, and try and get the gist of what is being said rather than pushing their own barrow or thing all the time. It is nice to be able to vary and personalise your comments to each post a little, rather than 'develop develop develop' or 'use a buyers agent use a buyers agent use a buyers agent' or whatever the barrow is being pushed (in theis case, developing/co developing.

2.  Absolutely not. I have enjoyed listening to some developers speak such as Peter Comben and Carly Crutchfield, and certainly plan on doing so with Micahel Yardney when I am able – who I have the utmost respect for. Developing is a great idea, but do you really think that would be the first project 'the spock family' should tackle, in light of the comments and circumstances???

3. Absolutely, buy and hold is only one stategy. 

4. This is the comment you made that really shows flagrant ignorance – and why I bothered replying.
While I am not suggesting spock fits this criteria, I have lost track of how many people I have spoken with that perhaps have their own business, had it for less than 2 years, (or perhaps just spend any surplus profits on non appreciating things/entertainment etc) and have no deposit, and yet are desperate to get into debt and make repayments higher than what they apperar to have been ever able to save……SERIOUSLY, if someone (anyone) is not in a position to purchase something NOW, but would like to as sonn as they are able, I stand by my comments of doing all you can to SAVE MONEY meanwhile as they can, via savings, selling something, or using a sensible budget…..yes a 'kitty' for their new property purchase. It's called a deposit. A great goal to have.  Beats getting dissalusioned and blowing it on rubbish instead and finding yourslef in the same position in 2 years time surely?…….A 5% deposit is certainly an attainable goal in a year or two for someone if there income/business is reasonable. 

5. It seemed a lack of excitement did not appear to be the issue, especially if a CF positive or CF neutral property causes consternation.

6. No.

Phew.  

Hi madprop – purely my opinion, for the PPOR I would be fixing at either term you mentioned, possibly five, depending on how long you have to go, BUT I am not a believer in signing up for a fixed loan that cannot have some extra payments made. (other than an option I will mention in a jiff….) Some lenders still do not allow this, others have an annual maximum without penalty, others a flat max amount for the fixed term. The thing is, no one can forecast ahead what circumstances may change in 5 yrs – new job? inheritance? BOnus? Sell the spare car? As far as the IP goes, much would depend on what you paln – if it is to sell within a couple of years, or the possibility you may, variable may be a wiser choice. The other option with the PPOR is to split the loan, with say a small part (25%??) variable, and the rest fixed. THat way, if the lender does not allow extra repayments off the fixed part, you can then make extra payments at your leisure from the variable part of the loan, and of course use redraw from it too if needed for emergencies etc. Three more rate rises on a small variable loan is obviously a lot less painfull than on the whole large loan. All the best.