Hi All,
first of all, there is some great advice on this forum! so thought I’d see what great ideas might help me..
My Situation:
1st IP
Mid-low $400’s unit with 2 bed/ 2 bath/ 1 car owned it for about 3 years with about $40k equity… have good tenants paying $400 per week..it was my PPOR, got the FHOG years ago and the stamp duty exemption – lived in it then rented it out since, got a TDS which is good as the unit is only 5 years old. so been out of it for about 2 years…still only in my name on title… so for another 3 years if sold there would be no CGT payable on this property.
Land $372K valued at $430k – located in Gymea
Current PPOR
Now living with my partner in one she bought, worth in the mid $400’s 2bed/ 1bath/ 1 car also with about $40k equity…but no tax effectiveness as we both live in it…could do with a new bathroom and kitchen…earning potential of about $370-$380 per week
Loan $384 valued at $440k – located in South Cronulla
each property are in single name only on title – the first in my name and the current ppor in my partners name.
Our issue:
We have an eight month old baby, my partner has just returned to work and we are planning to expand our family in the next 2 years.Our current unit is fine for a first child and will do a couple of years… we need to get into a bigger house whilst we are both still working.
What have others done or what would you do in this situation?? We would like to keep at least one of these if possible…
Any advice would really help us!!
Thanks All!!
You are highly geared with little room to move.
Have you considered moving out and renting? You will probably find something similar to what you are in now for much less per week than the loan. You will also be able to get tax savings by negative gearing your current home – and can do so without CGT implications for up to 6 years.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Switch both loans if not already to interest only with 100% offset on the new PPOR and ensure you have done a Depreciation report on your IP.
This should reduce the monthly cash flow and give you time to decide what to do when you are ready to leap.
Richard Taylor | Australia's leading private lender
Bear in mind that you and your partner can ony have one PPOR between you, you can both elect whether it is yours or your partners otherwise it is 50% for each. You need to do the figures to see which way to go on claiming PPOR.
Qlds007 wrote:Switch both loans if not already to interest only with 100% offset on the new PPOR and ensure you have done a Depreciation report on your IP.This should reduce the monthly cash flow and give you time to decide what to do when you are ready to leap.
We have the PPOR as an offset loan.. and just doubled our monthly repayment while we can afford it. Trying hard to pay down the loan on the PPOR as much as we can… would love to get into a house in about 15-18 months if we can!!
Why would you pay down the principal rather than merely deposit the funds into the offset account.
i would switch the loan to Interest only.
This gives you flexibility as well as protecting the tax deductibility of the interest.
P & I with xtra repayments gives you little to no room to move.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi All
Well – now a little further down the track our little boy is just over 1 and we are expecting another baby later in the year, so we have rapidly outgrown our 2 bedroom unit and will have to move.
Also we are going to live off one salary!
We need some professional advice to see what options are available to us. We’d like to at least keep the place we are in and would like to move to a 3 bedroom house.
Any advice or recommendations of a professional property advisor would be great if anyone knows of one.
Cheers!
Hi level3
Congratulations on the second baby
It sounds like you need to speak with a broker regarding your borrowing capacity and the options available to you rather than a property advisor.
Cheers
Jamie
Jamie Moore | Pass Go Home Loans Pty Ltd
http://www.passgo.com.au
Email Me | Phone MeMortgage Broker assisting clients Australia wide Email: [email protected]
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