Is there a better way?

[Riaki]

Hi all,

Still learning and hoping to research as much as possible before the next move in this all consuming market (not quite as fun as shoe shopping!!).... any advice would be appreciated!

Current situation is ... primary residence was bought for 270k in 2005, renovated and current market value is approx 320k...no CGT to pay since it's a primary residence; still owing on loan is approx 100k.

Target is....to buy a primary residence valued at approx 400k, and an investment property at around 200k, leave that negative geared for the moment.

Is it possible to achieve this under the one loan (anyway the entire amount could be negatively geared??)? Are there any clever ways to go about the next steps... This is most certianly demonstrating my lack of understanding of equity....is there a better way?

Cheers,
-Ria

 

[tubs]

Best to leave the two as separate loans. In fact, I'm not sure if you could even have 1 loan for 2 properties, since it would be messy if you sold one.

You could not claim interest in your PPOR anyway. You can only claim interest on your IP.

 

[alexlee]

Be VERY careful when determining how much is deductible and how much is not. e.g. if you refinance the PPOR to buy another PPOR, THAT portion is not deductible.
Alex

 

[Riaki]

Thank-you! any tips on using equity to be more clever about how I do it ?

 

[skater]

Thank-you! any tips on using equity to be more clever about how I do it ?

Do a search on debt recycling.