What to do for 2nd IP?

Hi,

After any suggestions that people may like to offer.

We’ve moved OS this year for work and travel. During our time here I’d like to invest surplus income as we’re fortunate enough to have our rent covered.

We have our PPOR in Australia which is CF neutral and a -ve geared investment property bought for location and CG. Total loans are at about $760k on a combined value of $1020k.

Gearing is fairly high but job CF is good as earning pounds.

Currently looking into refinancing in pounds to get access to lower interest rates. Has anyone been successful with this and how is the interest and borrowing costs treated for Australian tax?

Due to gearing we are probably restricted to borrowing a max of about $250k.

My ideas are to either:

– purchase some +ve CF at around the $100-150 mark, use the money to put into existing loans and then reborrow to do again once equity restored.

– purchase a rentable place on a large block that can be subdivided. This will likely be -ve CF but we have income to cover this. Intent would be to develop in a few years time on return to Australia.

– save to get enough to buy into a commercial investment for say $200k, would need $60k for the 70% LVR on commercial property.

– look into the UK market for investments here.

Any other ideas? Has anyone been in a similar position?

As we won’t be going back to Australia very much research will be over the net and likely to use some of the property hunters (have contacted some from this forum already).

Would be great to some input from the experienced investors out there.

Thanks,

Thomas