is it too early?

Hi Guys,

i am finishing up my 6months FHOB and heading back home and i'm thinking ahead when can i get my next IP?

current situation
purchased a house on 98% LVR 6months ago purchased a house $281K 5.1%
Rent will be $300 per week - $1200 month
Property management cost per month 5.5%
IO Loan - approx $1100-1200 per month repayments

based on the info what could i afford? is rent included in serviceability? i am out of pocket about $1840 costs per month leavin me $2100 to live on.

roughly how much deposit including costs will i need to satisfy 90%
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You have two things you would want to consider.

The first is: Will the bank actually give me some money? Yes, the bank will take your income into consideration - speaking to a bank or broker will give you a good idea if you can borrow, and if you can't - they should be able to gvie you some indication as to what position you need to be in so you can. It will give you something to aim for.

The second point is: Can I actually afford it? Just becuase the bank is going to give you the money, it does not mean you should go out there and spend. Look at what interest rates have done in the recent past, it will give you an indication of what could happen in the future - could you afford that? Do you have anything to fall back on if things go wrong, what about losing rent for a period of time?

Once you have these two issues answered, answer may become a lot clearer for you. Only you, at the end of the day, will know the answer to the second one. I know people that have successuflly lived off a pittance to get their properties, and they were prepared to do it. Many, however, would not.

Best of luck!