As I have read I agree it is all about strategy. My strategy was to kill off my PPOR debt.
So this is my story:
My first IP became my home after evicted due to redevelopment in the cheap unit we were renting.
We sold that PPOR to buy development block.
We developed two unit and sold one to lower debt by half but left with crap house and it did provide income during the 1990 recession when i was retrenched twice!
Keep that house and bought another PPOR in Sydney when we moved.
Sold first house and existed original PPOR debt. So we had nothing to gain really at this point other experience and income.
Worked hard to pay down first PPOR
Bought IP.
Bought 2nd IP.
Sold 2IP and existed all PPOR debt so we owned PPOR worth $500 in Sydney at this point no debt and IP in VIC worth $160k bought for $112k.
It was at this point, it all became easier. From here we have bought multiple IPs and the banks loves us being PPOR debt free.
My strategy worked however I learn't :
Development is variable to bet on at the early stages, not worth the risk unless you buy a wreckand hold it.
Buy a good PPOR with growth potenital, then ASAP buy an IP in the same area.
Let the first go up and then use the equity to pay PPOR and IP. Move into IP then no CGT.
My mistake was to sell the IP not the PPOR. I payed CGT as a result.
FYI Peter 14.7
So this is my story:
My first IP became my home after evicted due to redevelopment in the cheap unit we were renting.
We sold that PPOR to buy development block.
We developed two unit and sold one to lower debt by half but left with crap house and it did provide income during the 1990 recession when i was retrenched twice!
Keep that house and bought another PPOR in Sydney when we moved.
Sold first house and existed original PPOR debt. So we had nothing to gain really at this point other experience and income.
Worked hard to pay down first PPOR
Bought IP.
Bought 2nd IP.
Sold 2IP and existed all PPOR debt so we owned PPOR worth $500 in Sydney at this point no debt and IP in VIC worth $160k bought for $112k.
It was at this point, it all became easier. From here we have bought multiple IPs and the banks loves us being PPOR debt free.
My strategy worked however I learn't :
Development is variable to bet on at the early stages, not worth the risk unless you buy a wreckand hold it.
Buy a good PPOR with growth potenital, then ASAP buy an IP in the same area.
Let the first go up and then use the equity to pay PPOR and IP. Move into IP then no CGT.
My mistake was to sell the IP not the PPOR. I payed CGT as a result.
FYI Peter 14.7
