Am i on the right track with my portfolio?

[m.sewell]

Hi,

I just signed up to this forum and find it very useful. I am hoping someone with more knowledge can help me.

I have been on a salary of 100k since I was 18. I bought my PPOR in 2006 for $299k in the suburb of Wandal in Rockhampton. One year later I bought a high rise building unit on Queen street Brisbane city for $430k. I recently bought my last IP in Wandal, Rockhampton for $248k.

2006 - PPOR $299k (now worth $350k)
2007 - Brisbane unit IP $430k (now worth $470k) rents for $2400 net a month. Body corp approx. $6k.
2014 - Rockhampton IP $248k (worth $248) rents for $1000 net month.

My loan is set up with three loans with offset accounts.

$260k owing on PPOR - P and I
$360k owing on Brisbane unit - Interest only
$200k owing on Rockhampton IP - Interest only
4.8% interest variable.
$30k in offset account.
Salary now is $160k

I am very disappointed with the small amount of capital growth in my first two IP's. However as I was so young with a large income I rushed in and bought them thinking I was doing the right thing. I would like to know thoughts and what I should do next as I feel as though I am going nowhere.

Any help would be greatly appreciated!

 

[Brady]

Change PPOR to interest only and divert the principal repayments into the offset. This will preserve your funds in the offset, possible that you might want to upgrade your 1st purchase and keep property as an investment property. You can still debt recycling at a later stage if required.

Besides that I would possibly look to diversify and something worthwhile that someone posted on here that has stuck with me... Going forward... If you aren't going to make money from the property in the first two years don't buy it. That could be either CF+ of CG which can also come from development or Reno.

Besides that you're on a decent income try to save as much a possible, set goals. Then when you get next deposit ready do some really good DD this forum is a great resource and try make the best possible purchase you can afford at the time. (Note don't use offset funds for deposit, make sure you debt recycle)

 

[m.sewell]

thanks brady

 

[m.sewell]

You can still debt recycling at a later stage if required.

This might seem like a simple question but what is debt recycling?

 

[D.T.]

You can still debt recycling at a later stage if required.

This might seem like a simple question but what is debt recycling?

Replacing non deductible debt with deductible debt.

Say PPOR has 100k of non deductible debt and 300k of deductible debt that you used as deposits for IP's. As you pay down the 100k portion, you can increase the 300k portion.

 

[m.sewell]

Thanks DT ;