Hi everyone,
I’m a new member and hoping someone could give me a good idea on what’s the best thing to do about my situation that’s why I registered. I and my wife owned a villa and lived for about 7 years then we bought a 2nd house which at present has about $110k owing and we rent out our villa for $210/w. As we’re having a positive gear or a full income on our villa we decided to buy a townhouse worth $180k for Investment and rent out for $200/w to offset the positive gear for tax purpose. Now because our loan is int/principal for 2nd house, we are paying $1400/month (which is more to pay the loan faster) and also our repayment for the townhouse is $1250/month in total $2650/month just for repayment. My plan now is to sell the townhouse and whatever profit we get we’ll pay it to my 2nd house to reduce our loan amount. Is this a good decision or shall we just continue with our present situation?
Any Help?
Thanks.Sonny,
What are your goals with your property investing?
Simon Macks
Mortgage Broker
http://www.mortgagehunter.com.au
0425 228 985Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.
Hi Simon,
Sorry for not answering soon, our goal is to acquire investment property to help us in our retirement as we are getting old. I’m 54 and my wife is 50 and aside from that my daughter is only 11 yrs. old, but it seems with our situation to acquiring more investment is more difficult because the repayment of $2650/month is already more that one person salary. Now if we buy another investment with our income we could not afford to pay the repayment anymore. Could you suggest something? If you have any question, please do so and I’ll be happy to answer.
Thanks
Sonny
Hi in my opinion if your objective is to acquire properties to rent, then you shouldn’t sell because the townhouse expenses such as mortgage etc is tax deductible. What I would do is try to borrow the full 80% value of each of the properties by getting your banks to revalue. Then you get the extra money given to you and pay that into your house mortgage where u reside….
I’d be concerned that if you pull the money out of your investment properties you won’t be able to claim the interest on this portion anyway as the redraw wasn’t for investment (ie: it went into PPOR).
You could use the equity in your current properties for investing in +ve cashflow property, if you are comfortable with that scenario. Have you read “0-130 properties in 3.5 years”? It might be a place to start so you can work out your risk/comfort level etc.
Regards
PKHi,
We tried to pull some money out from my Investment, but as PK said I can’t claim the interest in this portion cause this is not used for investment thanks for the opinion. I’ll try to read 0-130 property in 3.5 yrs. may be you”re right PK. Again, Thanks a lot for all opinion, hope some more opinion will be posted.
Thanks,
You must be logged in to reply to this topic. If you don't have an account, you can register here.
