I am in a situation where i have a mortgage of about 250k and can sell the principal residence for $750k leaving 500k profit. The property is in an appreciating acerage area that probably wont be subdivideable. With 500k i can buy a newish principal place , be debt free and have somewhat higher borrowing capacity to invest in other investment properties. selling enables me to be debt free and put all income into paying for income producing debt, but selling also means im giving up a blue chip investment that has made me some good profits. What to do!!!!!!
Andrew
Don’t fall into the trap of selling a good growth property jsut to invest in inferior cashflow property. You will be worse off in the long run. $250K is not much debt on a property like that. Acreages near teh cities are becoming scarcer, making values rise quicker than average homes. I’d be hannging on and using the equity to buy more.
Terryw
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Hi. This really depends on your goals and what you want to achieve. If you love the property, and it is a family home for you and you have no difficulty making repayments, as Terry said you would be way better off to use the equity in your property to borrow. However, if you wish to ‘simplify your life’ and get out of debt lots of people take this course of sell, and buy a cheaper property to live in debt free……which for many is a good idea. Would you/your family be happy though off the acreage is just one question you have to ask. All the best.
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