Thanks for the replies! My wife and I weren’t married at the time she bought, (even though we found the place together and were defacto) and she was gifted a good chunk of money but unfortunately she couldn’t get a full 80% loan at that point due to her employment (and the person who gifted it didn’t want my name on the property, which is fair enough as we weren’t engaged at that point). So we got the largest loan we could and went interest only right away. So the loan is still as big as it was when we bought the place and we have been putting all our cash into an offset account as you suggested.

The other option I see to increasing the gearing, is for me to buy 50% of the property using s104B of the Duties Act NSW which permits a transfer from ONE spouse so that after transfer the ownership is then either joint tenancy or 50/50 Tenants in Common..Just a matter of my serviceability then.

As you said, Erskineville is a prime location and if we sell we will never be able to get back in at the price we paid.

Thanks for the help!