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I can see what your saying, but I'm also looking at cash flow. If my holding is to expensive, then I will not be able to save anything once I buy. Essentially relying on rent increases to improve cash flow, which could take years. So your saying buy with say 10% deposit, 90% LVR and buy sooner...

Either way if I use cash or equity, the calculation is the same. as cash goes into offset account on IP1, which reduces this loan, and once spent, loan on IP goes back up. yes using variable rate will reduce payments, but we dont expect rates to remain at ~5% So although holding costs now are...

I would expect this IP to double in 10 years, so I would make $450,000 profit, less holding costs of $91200.. so thats $360,000 profit.

I have 1 IP, and am doing the figures on purchasing another one. I have looked at purchasing a $450,000 house. These are the stats: 5 year fixed rate 7.79% CBA: $35,055pa Rent expected: $20800pa Costs: $4500 Total gross holding cost: -$18755pa negative gearing tax refund : $5626...