Hi all. First a reminder of current financials
Married no kids (for a few years yet)30 years old Wife 27
Combined income of $125,000
PPOR worth $345,000 Owe $190,000
IP worth $310,000 Owe $310,000. (Just bought, In great area of town but south coast nsw not doing anything great.total holding cost on this property including tax return are around $37 pw)Now my question. As i have stated before i also own a australian muscle car that has increased from $40,000 to just over $100,000 in just over 1 year. This muscle car boom looks set to continue for some time yet with my car potentially reaching $150,000 buy xmas ( maybe more but being realistic)
Now if i do sell and reduce my PPOR to around $50,000 should i pay the $50,000 off over the next year and then buy IP number 2 when i have no PPOR debt or.
Jump in and buy IP number two regardless of remainder owned.
I see the advantage of waiting becouse my $350 pw PPOR repayments are gone allowing me to fund another property easier.
What are your thoughtsWhy wait? You could set up a split loan on your PPOR and use this as deposits and shortfall, for the new property. It would therefore cost you nothing out of pocket and you can still pay off the home loan as per normal. I see the only reason to wait if you think house prices in the area you want to buy to remain flat or drop further.
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
Well I'd like to know what car you have!!!
hsv group a Walkinshaw
lol..its a piece of crap…
I'll take it off your hands for 400 bucks….Ha ha ha. Yes i wouldnt pay what they are worth today thats for sure. But i have had three genuine offers of $110,000 so you will have to increase your offer a bit.
Hey Devo. I was never that rude talking about your VL was I? Never even mentioned the nicknames they had……
Seriously, you have done well with your PPOR, and if you can reduce your loan to around 50k by whatever means that puts you in a great spot to sit back and decide what to do next. A refi (or if happy with your current loan split it in a way to suit investing) will put you in position to make some good offers for more IP's, or even fund a couple of deposits. Having that much equity in your home is a great springboard then. Maybe look at a slighly lower price bracket house in your area from a motivated vendor – there are plenty around your way.
All the best with whatever you decide.Devo76,
If your car is appreciating at a much greater rate than the interest payments for your PPOR then maybe it is worth hanging on to your car until the heat comes off the muscle car scene and things start to slow down, then it may be time to sell, cash in and smash down the principal on your PPOR.
Don’t hold off buying another IP though, I made the same mistake a few years ago by trying to pay off my PPOR in minimum time, it literally cost me hundreds of thousands of dollars from lost capital growth I could have had from additional investment properties. I wouldn’t wait, bite the bullet and invest, providing you are purchasing in the right area with sufficient growth potential of course.
Thanks guys. Im not sure how high muscle cars can go. History shows that once housing is flat and the economy slows.Muscle car prices suffer a fair bit becouse they are a luxury .I also heard that muscle car profits may be tax in the near future. I guess it was only a matter of time before the tax man got his slice.Also prices for cars in america have flattened and dropped on some models.
So i guess i want to jump with a good profit instead of risk it.
As for walkies being crap. What ever. $110,000 offers say they are alright to me.
So if i sell i save money on interest payments and after another IP purchase get some axcess to more capital growth.
I'll take it off your hands for 400 bucks….
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