Interesting post – following with interest.

I’m in a similar situation (2 x Perth IP’s -ve geared on one on interest only and +ve on another P&I) with their market value rocketing along on double digits year on year – i will have a strongly significantly cash flow +ve portfolio very soon (also in high growth areas which is nice). My strategy…[Read more]

Thanks for the feedback.

This house used to be our POR and we paid most of the mortgage off when we were living in it so it is cash flow positive currently. That doesn’t mean we aren’t thinking about selling it. Not so sure it is a great use of capital…..

We have built into the contract 6 monthly rent reviews (even though it is a 2 year lease…[Read more]

Thanks for your feedback Derek and Stargazer.

I set this up about 6 months ago thinking this was a great idea. I guess I should have know better – if it seems too good to be true it probably is! I will pursue a second opinion.

Beforee I do and to make sure I understand this ……..
If I used the LOC to pay the IP’s IO monthly payment and then…[Read more]

Thanks Steven,

My IP has an interest only mortgage. I am claiming the interst on the IP mortgage and the interest accrued on the LOC (which is only paying interest off the IP mortgage) as deductions against income.

This does increase the loss but it’s all tax deductible and allows me to pay down my non-tax deductible PPOR IO mortgage much…[Read more]

I have a similar situation to this in Perth and have structured it as follows:

– PPOR has $270k equity and $80K PI mortgage
– IP has $380k IO finance
– IP interest payments are being made by a LOC (which I am not paying off)
– All rental income from the IP is channelled to pay down the PI mortgage on my PPOR.
– I also make voluntary payments to…[Read more]

Look at the bright side PurpleKiss – there is no wear and tear being inflicted!!

My insurance compay will insure an un-occupied place after the set period if I call them, advise them of teh situation and pay a little extra premium. Have you asked your insurance copmany whether they will do the same?

I would worry more about vandalism of the…[Read more]

We have a company mangaing two places (unfurnished houses) in Perth, WA for us. I think their fee structure is a little high, but they have done a very good job so far so am reluctant to change. They charge as follows:

– 9.9% of total incomings (such as letting fees, rents etc.)
– $10 / month – postage and sundaries
– $55 / quater – routine…[Read more]

I agree with the general theme of the replies so far – this really has to be your decision and it depends on your lifestyle choices etc. Putting money into your own home is not dead money as it builds equity which can be used later to finance IP’s. However, rent money is dead money from day 1. Having said that you can be better off renting as…[Read more]

This is an interesting topic, one which I am generally confused about the advise. Until you own your own home outright you will never achieve financial independence. Why put this off?

Additionally if structured correctly you can pump all generated cash into your own home and maximise your IP portfolio tax deductions (through LOC’s) which brings…[Read more]

Thanks for the constructive input. Robert I understand where you are coming from with the CoCR calcualtion – thanks for the patience.
I guess am I having trouble with the principal of the calculation because the calculation revolves around a choice you make (e.g. equity based or cash down) both of which change the output but don’t change the…[Read more]

Thanks Lucifer)au and Steve.

I have read pages 60 and 61 and that is what got me thinking about this in the first place. Thanks!

Once you have determind that a particular person(s) are suitable (i.e. you have determined why you need/want a partnership, what you expect to gain from it, how you protect the interestes of one anothere etc.) what…[Read more]

Thanks for the couple of comments. Whilst I agree the forumas are only a guide, used incorectly they can be very misleading.

On question 1….
I tend to agree with Lucifer_au on the CoCR question because whether you have physically injected cash or not is really irrelevant, it has locked this equity up and hence it can not be used for any other…[Read more]