Hi there

I'm not a lawyer or PM but I would have thought that it would be covered under strata.

Did you ask strata if the costs would be covered before the work was done? If not, maybe that's the issue.

Cheers

Jamie

lol – massive difference.

Canberra winters are ridiculous.

I was up in Sydney on the weekend and the weather was amazing. Their winters aren't as harsh either.

The biggest draw back is what money can buy in terms of a PPOR. I can buy a 5 bedroom house with a decent yard in Canberra which is less than 5kms from the CBD  for the same price as a two bedroom unit on the Northern Beaches.

Cheers

Jamie

I have a preference for established properties that you can add value to. Particularly via affordable, cosmetic renovations.

Like xdrew said above – you generally pay a premium for a new property and there's no scope for value add which means you could be waiting quite a while for any equity gain.

Cheers

Jamie

Further to what's been mentioned above. When/if you decide to access equity in that property, make sure it's set up as a separate loan of the new funds are being used for non investment purposes so you can identify your non-deductible debt from your deductible debt.

Cheers

Jamie

Hi Goatus

Fantastic name!

Anyways, back to the property stuff.

If the two properties that are to become IPs aren't already set-up as interest only, then get onto that asap.

When you release equity in the properties, ensure that the equity releases are set-up as separate loans so you can determine which debt is deductbile and which isn't.

Will the new PPOR ever become an IP?

Apart from that, it's hard to provide a better response without knowing more.

Cheers

Jamie

It's a personal question that only you can really answer.

If you've decided to forego a nicer PPOR in order to utilise more of your income on IPs then have you considered the option of renting rather than owning?

Cheers

Jamie

Hi Anthony

Congrats on the first purchase and welcome aboard.

Signing up to this forum will provide you with a wealth of free, up-to-date information. There's also a heap of good books that will keep you busy.

Feel free to ask anything.

Cheers

Jamie

Hi Gary

I would be worrying about if they're applying interest to it.

Tell them to sort it out or you'll seek legal advice – just sounds like a lazy body corp to me.

Cheers

Jamie

Hi rsubax72

Will this property be a PPOR forever or is there a chance you may turn it into an IP down the track?

I know it may be hard to determine now but it's an important question.

Stop shopping around with multiple banks! Each of them are probably submitting a preapproval which is ending up on your credit report.

Cheers

Jamie

Hi Synergism

Welcome aboard.

Terry's right – some careful planning and correct advice from the start would have saved you quite a bit of money.

Back to your question though. It sounds like you've already done the calculations on holding costs and have recognised that you can't afford to purchase a new PPOR in the inner west. On that basis, I wouldn't jump into the next purchase until you're in a position where you can confidently meet your increased level of debt.

Owning a PPOR on a smallish income can be quite burdensome on serviceability. I have a few clients on relatively low incomes who still live at home with the folks or rent in a share house and are able to accumulate properties because they don't have a large PPOR debt weighing them down.

Cheers

Jamie