Hi All,
I've only recently signed on my first home, to by my PPOR. I'm 27y.o IT professional on an OK salary (sub 70k, over 60k) which should continue to rise ~5% per year.
I had been searching for about 6 months, and while it's not as central as I would have liked to to be, I believe it's in a good pocket for future capital growth, some of which could be realised within the next 3 years due to a major bypass completion being quite near. Future CG should also be fed from a proposed train station nearby on the Melbourne line, and commerical development for much of Geelong's future (30yr) growth also planned nearby.
For those familar with the Geelong region, the house in in Waurn Ponds. Approximately 1km from the end/start of the Geelong Bypass, making travel to Melbourne much easier than through Geelong, and at the same time making travel to the Surf Coast for Melbournites also much quicker. The house is also within 1-2kms of the University. It's a 4br double garage, so future rental opportunities is well placed for a larger family. Currently at 90% LVR.
My loan will be split 50/50 between a 5yr fixed rate (for security) and a variable loan - both P&I. I will have an offset account linked to the variable portion, where all my excess funds will be kept. I have a 25k family debt (assistance for a deposit) which I need to pay off in approximately 5 years. There is no interest on this, and no real drama if not ready to pay in 5yrs - though I don't like owing family money.
I want to start tying together a diverse collection of assets for my future. At this stage I'm not too concerned with working out how much I need to retire early etc. Though, I do want to start building the wealth to take advantage of my young age.
My intentions.. all of which includes paying off small portions of the 25k in cash when I can afford to.
Regarding the purchase of the first IP, will it work in my benefit to save for a cash deposit in my offset account, or simply have my PPOR revalued to a point where there is enough equity in it to borrow 80% of IP value and get the 20% off my PPOR? How does this function - I mean, does it in effect help me buy an IP without saving the cash, but at the same time work against me in that I am borrowing against the PPOR, which is not tax deductable? Will the 20% deposit from my PPOR equity being tax deductable?
Similarly, can things such as the Margin loan for share investments be funded from CG on my PPOR? I understand once I have my first IP, it's that property I'd be wanting to draw any equity down from and not the PPOR?
It's a mind shift for me, for years I always had the intention of buying my first home, and working as hard as possible to pay of the mortgage outright.
I've only recently signed on my first home, to by my PPOR. I'm 27y.o IT professional on an OK salary (sub 70k, over 60k) which should continue to rise ~5% per year.
I had been searching for about 6 months, and while it's not as central as I would have liked to to be, I believe it's in a good pocket for future capital growth, some of which could be realised within the next 3 years due to a major bypass completion being quite near. Future CG should also be fed from a proposed train station nearby on the Melbourne line, and commerical development for much of Geelong's future (30yr) growth also planned nearby.
For those familar with the Geelong region, the house in in Waurn Ponds. Approximately 1km from the end/start of the Geelong Bypass, making travel to Melbourne much easier than through Geelong, and at the same time making travel to the Surf Coast for Melbournites also much quicker. The house is also within 1-2kms of the University. It's a 4br double garage, so future rental opportunities is well placed for a larger family. Currently at 90% LVR.
My loan will be split 50/50 between a 5yr fixed rate (for security) and a variable loan - both P&I. I will have an offset account linked to the variable portion, where all my excess funds will be kept. I have a 25k family debt (assistance for a deposit) which I need to pay off in approximately 5 years. There is no interest on this, and no real drama if not ready to pay in 5yrs - though I don't like owing family money.
I want to start tying together a diverse collection of assets for my future. At this stage I'm not too concerned with working out how much I need to retire early etc. Though, I do want to start building the wealth to take advantage of my young age.
My intentions.. all of which includes paying off small portions of the 25k in cash when I can afford to.
- Save $15,000 in the Offset Account ASAP. Margin loan $10,000 and Invest 20,000 in a moderate growth managed fund/shares fund. (5k stays in offset)
- Purchase an IP (or new PPOR).
Regarding the purchase of the first IP, will it work in my benefit to save for a cash deposit in my offset account, or simply have my PPOR revalued to a point where there is enough equity in it to borrow 80% of IP value and get the 20% off my PPOR? How does this function - I mean, does it in effect help me buy an IP without saving the cash, but at the same time work against me in that I am borrowing against the PPOR, which is not tax deductable? Will the 20% deposit from my PPOR equity being tax deductable?
Similarly, can things such as the Margin loan for share investments be funded from CG on my PPOR? I understand once I have my first IP, it's that property I'd be wanting to draw any equity down from and not the PPOR?
It's a mind shift for me, for years I always had the intention of buying my first home, and working as hard as possible to pay of the mortgage outright.
