Hi all,
my first post so firstly want to say great forum.
Have been reading this forum for some time and have managed to learn a lot about the property market but now need some advice/opinions as we are starting down the path of first home ownership.
Here is my situation:
Currently overseas but am looking to buy later in the year once we return.
Will have around 150K deposit by then and am looking in the eastern suburbs of Melbourne (FT Gully, Croydon, Boronia etc).
Initially our plan was to buy a house (PPOR), then in a few years down the track use whatever equity we have to buy our first IP.
But from having read a few others posts on here I see a lot of opinions to buy with an IO loan and not use all of the deposit (i.e. leave some cash sitting there in an offset).
Can someone give me good reasons why to do this?
I would have thought with a PPOR you would want to be building as much equity as you can, especially as the areas I've mentioned haven't had such huge growth over the last few years, and aren't predicted to in the next few.
Now, we also may live in said house for a few years and instead of buying an IP, turn that into an IP and buy something else to live in. I guess in this situation it would be good to have it with an IO loan, but if it doesn't work out that way and we stay there then I'd feel I'd wasted x number of years paying interest but no principal.
Any help would be appreciated.
G.
my first post so firstly want to say great forum.
Have been reading this forum for some time and have managed to learn a lot about the property market but now need some advice/opinions as we are starting down the path of first home ownership.
Here is my situation:
Currently overseas but am looking to buy later in the year once we return.
Will have around 150K deposit by then and am looking in the eastern suburbs of Melbourne (FT Gully, Croydon, Boronia etc).
Initially our plan was to buy a house (PPOR), then in a few years down the track use whatever equity we have to buy our first IP.
But from having read a few others posts on here I see a lot of opinions to buy with an IO loan and not use all of the deposit (i.e. leave some cash sitting there in an offset).
Can someone give me good reasons why to do this?
I would have thought with a PPOR you would want to be building as much equity as you can, especially as the areas I've mentioned haven't had such huge growth over the last few years, and aren't predicted to in the next few.
Now, we also may live in said house for a few years and instead of buying an IP, turn that into an IP and buy something else to live in. I guess in this situation it would be good to have it with an IO loan, but if it doesn't work out that way and we stay there then I'd feel I'd wasted x number of years paying interest but no principal.
Any help would be appreciated.
G.
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