Hi,
I contemplating doing the following :
I have 2 developement sites (1 x duplex and 1 x triplex) which are both positively geared with a retail value of approx 550k with 280k worth of equity. The locations aren’t prime (8km from CBD) but do attract decent growth per year.
A property in a prime location (5kms from CBD) as become available for 550k. This site can be duplexed developed.
What I’m thinking of doing is, selling the two lower value development sites to purhcase the new 550k property and put the 280k profit back into my own mortgage.
I’m not sure if this is the right way to go?
Cheers – nj
Firstly, what is your goal? What are you working towards?
Secondly, is the developing-selling-buying-developing strategy going to get you to where you want to be?
Thirdly, do the numbers on the deals. Work out the costs, possible costs, contingencies, profits (losses) and then decide which is the best way for you to move forward. Do you have to sell the 2 lower value properties? Is there a way that you can develop all three properties??
As for the mortgage part – only you can decide on what’s best for you. Perhaps you can find a good accountant/advisor if you haven’t already done so.
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