Liz,
We have all been there, perhaps some of us we not  ever cute though!

FHOG – first home owners grant, frderal govennment $7k grant for first time home buyers
PPOR – principle place of residence (own home you live in)
LVR – loan to value ratio, a measure of the loan amount compared to the purchase price
LMI – lenders mortgage insurance, paid when a loan is > 80% LVR, a one off fee to provide insurance to the lender
IP – investment property
FTB – family tax benefit, a federal gov't payment to assist families
MI – mortgage insurer (see LMI above)

I am not sure that LVOR isn't a mistyping of LVR
I hope that helps.
Greg

While the contract date is the date that the CGT is calculated on, if you get the timing right and say sell early July 2010, your tax return may not need to be lodged until May 2012 by a tax agent, so you could have up to 22 months before you need to remit the CGT to the ATO.
Just a factor to consider.
Greg

Keiko,
As a general guide, CBA LMI rates for a loan < $500k and  94-95% LVR, is about 2.5% plus the relevant state stamp duty.
You could expect $12k plus as a once off fee.
To qualify with CBA you will need to be an existing customer and they define this as 6 months at least.
Nearly all lenders have exit fees but CBA is one of the lower ones, I think $700 if discharged within 4 years.

Some MI's will refund part of the LMI fee but it will not be proportional so if you are looking at a quick turnover of the property, expect a large hit.

Good luck
Greg

Wisepearl,
Check with a good tax accountant but my understanding is that you can apportion LMI over the period after it becomes an IP on the basis of 1.5 of 5 is private expense and 3.5 of 5 is an investment expense.

If the LMI cost was $5k all up, for the first year you lived in the property, it is not deducible.
The second year, you lived in it 6 months, no costs are deductible, for the second 6 months as an IP, expenses can be apportioned and deductible. You should be able to claim $500 as an LMI cost for that tax year.
For the 3rd year, as a full rental property, claim $1k LMI as a deductible cost etc.

The ATO allows you to make adjusted tax returns up to 4 years past, so you could adjust your tax returns and adjust these costs but again, check with a tax good accountant or the ATO itself.
Let me know how you go.

Good luck
Greg

Mel,
Whether it is a LOC or term loan, the loan to value ratio (LVR) is the total loan amount divided by the property value.
A $480k loan on a $600k property is an 80% LVR.

It is the overall debt total on the security property that the lender holds.
If you need to access more funds, simply borrow to a higher LVR. Depending on use and on lender, you can refinance to 90% inclusive of lenders mortgage insurance if you can show you can service the loan.

Take care as most lenders and mortgage insurers are wanting chapter and verse on what the additional funds will be used for.Be prepared to provide a detailed explanation.
Good luck
Greg

From where the post started to the paths it has taken, there is some excellent points raised about choice and balance.
I work with property investors and I work with seniors, people up in their mid 80's. They are two very different markets but I gain information and education and knowledge from the seniors to see what paths they have taken to get to where they are now.

Savings is not enough for most people as only 5% of us are paid extraordinary sums. The old advice of pay off your home and never get into debt is not sufficient to build a wealth base to be able to retire in a degree of comfort. I have seen too many seniors scratching a living just off the pension. They own their own home, paid it off long ago but have little savings and a very modest lifestyle because that is all they can afford to do on a pension. The advice and actions they took was not enough.

To create wealth for most, it is a finance strategy you need to take on, borrowing other peoples money to invest in capital growth and income producing assets. It is about getting your capital to work for you, not just your income, to increase your wealth.
I use property as the asset class because lenders will lend up to 90% in most cases, sometimes more. They believe in it and continue to lend on that security.

After that it is about understanding what type of property you need to buy in order to qualify for finance to buy the next property. For many investors property is a buy and hold strategy, for some it is an income replacement or supplement strategy of renovations or developments and you need to understand which it is that suits you.

You certainly need to build in safety nets and risk insurance for protection so you do not have to liquidate or sell unless it benefits you.
Good luck
Greg

Rob,
I would agree with getting professional advice but make sure the accountant is an experienced property tax person because I have heard some terrible uninformed advice from many accountants.

1. As it is your PPOR you can transfer ownership to your spouse with no stamp duty implications. Trying to sell it and creating loans between spouses smells of tax avoidance, perhaps stay away from that path. If your existing LVR is low, perhaps transfer that to the lower tax payer and when it is rented, it will be a positive income stream.
2. There is a 6 year period re CGT but see your accountant, most know this stuff.
3. see 1 above if it is a PPOR, different story for an IP.
4. I agree with Mr5o1, no, if additional funds you pull out will be used to purchase a PPOR, the use of the funds determines whether it is deductible, so purchasing a PPOR is a private capital purchase and not deductible.

You could refinance and pull out equity and use it to purchase or fund the purchase of another IP and then it will be deductible. You then rent for a period instead of buying a PPOR. Perhaps in 5 or 6 years, consider selling your Geelong property, take advantage of the CGT exemption, free up enough equity  to purchase your own PPOR outright or close to.
Good luck
Greg

Cellphone,
You have not provided enough information as to what sort of growth you are after or the gearing or cost of funds or your MTR.
$500k is a reasonable amount of money, it will buy a good apartment in most capital cities where rent yields may get to 5% plus but it will most likely be negatively geared. What is too much for you?

In Melbourne, depending on cost of borrowings , depreciation and other costs and MTR, you could be cash after tax out of pocket $9k pa. Buying an OTP in Melbourne, you could be $6k out of pocket.

It may be enough to buy two houses in regional areas, returning maybe 6% yield with perhaps not as strong long term capital growth. It could be a buy in ACT and take advantage of the stamp duty deduction on leasehold. You could look at the NRAS deals where they may return positive after tax cash flow due to the tax benefits. DHA is another option where generally higher rent yields can be obtained. Each have advantages and disadvantages and it is about matching the property type to your needs to be able to build a property portfolio where the property type enhances you ability  to obtain finance for the next purchase.
Good luck
Greg

Welcome to the world of real estate agents of up-pricing to get the deal and then conditioning you down to make an easy sale.
To get a valuation you can try another three or four agents in the local area to do a free market appraisal and/or pay to get a sworn valuation by an independent valuer. It may cost you around $500 depending if they see it as a residential or commercial property.

That does not mean it will sell for that, all it means is that it is a valuers opinion of its market value. Combine this with a type of average from the various REA's, you will have a better picture.
Good luck
Greg

,FrugalOne,
It may be a different interpretation in the use of the terms equity and debt here. It is debt you are using as Richard said,  it is 100% debt as you are borrowing the funds to be able to purchase the respective properties.
In each case you are borrowing these funds secured against existing properties. The strategy you are outlining is 100% + debt funded and you will be paying interest on these loans.
Greg