Hi there,
My partner and I are starting to think about property investment in the future and what steps we can take to lead us in the direction of building a property portfolio. We purchased a unit two and a half years ago for $275,000, which we think is now worth $290,000 – $300,000. We currently owe $238,000 on the property. We are owner occupiers and are happy to be for the next 5-6 years before we start a family.
Just keen for some advice on whether we should focus on paying off our current property ASAP, or borrow against it in the next year or two to purchase an IP, or other options? We are a little lost and confused with all the options! We need to do more research and thought this would be a good start.
Also, I’ve heard bad stories about financial advisors and investment advisors, are there any decent ones out there?
Would love your feedback!
Hi Ashk
Firstly welcome to the forum and I hope you enjoy your time with us.
You would be suprised how many horrow strories i hear from clients who have been to financial adviser, charged a fortune and then been recommended not to buy a property but to put the money into managed funds etc.
As a Financial Planner we must be one of the only firms that actually recommends property to our clients.
Problem is the way in which FInancial Planners are remunerated as most are driven by the commission they receive from managed fund style product recommendations.
Ok enough of that onto some constructive suggestions.
Certainly from first glance you appear to have sufficient equity to purchase a new IP now however the loan would be fairly highly geared so might be worth get your broker to organise a valuation on your PPOR to see what numbers you are playing with.
Then subject to this you can start to thing about how you structure the new loan and look to move forward.
Remember any new borrowing will need to cover not only the purchase price of the IP but also sufficient to provide for the acquisition costs along the way such as Stamp duty etc.
Set up properly you could in fact find that the Tax savings enable you to pay down your PPOR quicker by buying a new IP than at present relying on your own incomes.
Once you get the property investing bug you will find it hard to stop and will at the same time be making provision for your own future.
Richard Taylor | Australia's leading private lender
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