Hi There our loans are interest only and are all stand alone loans.  Can't increase the rent because we made two bad choices when we bought these properties and they are not in super growth corridors.  We are already PAYG these properties.

Cleveland we owe 420K, rent is only $420 , we are out of pocket $320 per week but this does not include the variation rebate we get back.

Lemon tree we owe $174K, rent is $220, we are out of pocket $157 per week but also this doesn't include the variation.

Anyone in a similiar situation or has any ideas on what we should do??

Bel

Hi, According to my calculation, you out of pocket money should be much less than you claimed.

Your Cleveland property: Gross rent: 420×52 weeks=$21,840

                                          Net rent:    $21,840×90%=$19,656

                                          interest: $420,000×6%=$25,200

                                           Other expenses (water, rate and body corp fee) about $5,000

                                         So your annual lost is 19,656-25,200-5,000=-10,544

                                           Tax offset on you loss: 10,544 x31%=$3,269

                                           Your real loss: 10,544-3,269=$7,275

                                            However, because your property is only several years old, I guess you can get about $3,000 as

                                           building depreciation.

                                             So your out of pocket money is 7,275-3,000=$4,275 per year, that is: about $80 per week.

Similarly, your out of pocket money for lemon tree property is far less than $175 per week.