Hello everyone..I am new to this forum..Need some opinions from all you experts and then decide what to do..
i have a PPOR and also one investment property in melbourne..Got aboout 60k in cash..properties have gone up in value so there is equity..
Is it a good idea to buy another property in current market and apply buy and hold policy or just try to get plans and permit for the investment proprty..Kinda confused whch would be the best option..
If I decide to buy another property as for investment can I borrow on the basis of equity I have on two properties..
Any advise would be helpful..how do I approach to this scenario whats the best way todo..
Thanks in advanceHi there
Welcome to the forum.
It’s difficult to comment without knowing the numbers but from a finance perspective, if you have enough usable equity I’d certainly opt to use that as your deposit/costs for your next IP rather than use your cash savings.
This way, you keep the entire IP debt tax deductible and also preserve your cash savings (it’s always nice to have some cash stored away when building a portfolio).
Cheers
Jamie
Jamie Moore | Pass Go Home Loans Pty Ltd
http://www.passgo.com.au
Email Me | Phone MeMortgage Broker assisting clients Australia wide Email: [email protected]
For me:
Park the cash in an offset linked to your PPOR loan and use the equity from existing properties for deposit. Just make sure you set your loans up correctly – see a broker about this.
As for second part of the questioon – I am big on having a property. Not sure that a simple 'buy and hold' strategy is going to be that beneficial in the short/medium term. I'd be looking for something with inbuilt equity (undervalued), value adding potential and/or small scale developments. Based on figures I suspect buying undervalued or based on reno potential is the best option at this time.
Many Thanks Jamie and Derek…
If you still have a mortgage you need to look to keep buying in areas that are cash flow strong and yet still get good growth. Doing this will enable you to build equity so you could sell in a few years and pay off your current home loan, which in turn will open up plenty more equity to keep buying more investment properties if you so desire.
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