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Are you suggesting that instead of paying the bank the interest repayments or paying body corporate fees for example with my own money that i should pay these expenses by increasing my IP loan amount?
Thank you for the feedback. I have been playing around with different scenarios in spreadsheets….
Consider that i will have a PPOR which i will owe say 150k on and a IP which i owe the full amount on say 350k. I have calculated that the IP will cost me approx 7k per year after calculating the tax savings from depreciation and all other deductions and at a interest rate of 8%.
I do not see how i am benefiting from owning the IP if it is costing me 7k per year. In terms of cashflow, i will be paying 16k over the year. After tax i will be at a loss of 7k for the year. Am i better off paying off the PPOR first then buying a IP when I and the person renting can both pay off the IP? Is it common to owe the full amount on the IP and have it costing you money rather than making you money? Am I taking the right approach?Your advice and opinions are much appreciated
