As we are selling two, we will end up with 3 IPs only. And buy another which will become the PPOR. No cash buffers
My after tax income is 38.5k. And my partner takes home around 35k. She has been working full time during the last 18 months. We live on one income and invest the other. *But we will be on one income in a few months. If our sales and purchases go smoothly, we will have LOC equivalent to her earnings (35k). That is going to be our buffer. We will mitigate risks by fixing the loans.
Wow you would have to be very disciplined with your spending, good work!*
I*agree it can be a good idea to sell an ip. It depends what your strategy is & what you want to achieve I think!
One of my ideas/possible strategy is to add value sell later on in say a 1, 2, or 3 years and put the profit into my ppor offset account. So it will reduce the non deductible debt.Then I can draw out of my ppor line of equity funds for another deposit.
I like the idea of having a bit of a cash buffer. Once the ppor mortgage is smaller then my plan *could/would be buy and holds for a while so as to increase my capital base and grow my equity further. I know that there will be all sorts of costs involved like agents commission, CGT but I think I'd be ok with that if I get a reasonable profit. I'll still have another 20 years to invest in buy and holds. Oh also I could use some of my profits for a Reno here and there. It will come in handy for all kinds of unexpected expenses and would give me done sanf.