I really agree with StumpCam.  Make those extra dollars count and pay off that principle.  I've popped back onto the forums to test the general sentiment about property investment (and seems quite positive) to see if I should get another property, rip down the current one and build house/duplex/units or go into shares.  I wanted to know if the people chanting Australian property collapse is likely and if I would lose my equity.  If the worst did happen, at least I wouldn't be left owing the bank lots of money like those high and dry with interest only. But looks like that is not going to happen.

My wife and I get paid directly into the offset account.  Each $1000 in that offset reduces the interest payment by approx. $0.20 per day.  That is $0.20 per $1000 per day being paid off on the principle.  Doesn't sound like much but we are up to $12 per day after 1.5 years.  More is paying off the principle that way than the P portion of P&I.  There's the motivation.

I've been wanting that large TV for the last 4 years but can't quite bring myself to spend $4K when that's almost a $1 per day I would be missing out on.  It's quite sad, I think of everything that way now

marg4109 is the most correct here.  Just one minor alteration, instead of 365 days per year, use 365.25.  Account for that leap year.  The banks don't miss this trick, neither should you.

Keep looking around. My partner and I just purchased 299K at macgregor – 3bed house, very liveable (first investment). We were actively looking for around 8mths – saw a lot of houses, units, land, etc. Prior to this time and during we had cash invested (as well as reinvesting) in management funds … earning about 20% plus capital growth – ended up with 110K. Not sure whether it is a squeeze but there are a few cheap properties popping up at the moment.