Agree with Corey - IO on a PPOR is likely to have a negative impact on future borrowing capacity with most lenders under the current lending environment.
However - it shouldn't be a massive difference and if the PPOR is going to be converted into an IP at some point then I'd IO is still...
Yep - inner North seems to be going nuts.
Just had a look on allhomes - one property in Downer was listed for $620k+ sold for $760k.
Another 3 bedroom ex govy looking place in its original condition just sold for $657k. It would have went for $550k - $570k this time last year.
In some areas - and for certain properties, it's picked up heaps.
My suburb is going crazy :-)
The demand for houses in established areas is pretty strong. A lot of it is driven by the Mr Fluffy buy back and a general lack of decent stock coming onto the market.
There's still heaps of...
Owner occ or IP?
Doesn't sound like a good investment to me.
I'd search for a detached house in the surrounding burbs instead. You may need to beef up the purchase price a bit - but long term you'll get a better return from a house rather than a unit in Belco IMO.
If servicing permits and you've got 10% equity then WBC is generally a good option at this LVR.....but the deal will be scrutinised hard. They'll even order desktop vals on your existing portfolio to confirm you hold enough equity.
Borrowing power is determine by your income minus ongoing liabilities/expenses. LVR doesn't come into play (well technically it can for certain deals but there's no point confusing you further).
Banks look at both.
Whilst they won't take into account 100% of your rental income - they'll generally take 80% of it.
The biggest factor impacting investors serviceability right now is how banks calculate the debt you hold with other lenders.
Agree with getting a second opinion...