Hello there!
I admit to feeling a bit guilty my first post here is a question, thanks in advance for any assistance
Over the last four weeks my fiance and I have come to a fork in the road which I think boils down to Net Worth in PPOR vs Cash Flow and what I would like to know is have you ever had to make this choice? How did it work out?
The story so far:
A few years ago we bought our home in Perth and then a small commercial unit, sold both for a healthy profit, moved to Melbourne and put all the proceeds into our current PPOR; an apartment in Melbourne valued at $975k less $340k mortgage. We're spending 45% of our income servicing the loan and outgoings.
Our lack of cash flow is preventing us from getting an IP and traveling as much as we'd like.
1) Sell our PPOR and buy something less expensive to free up cash flow for IP and travel
2) Keep our PPOR and struggle through building our equity in it, borrowing against that to travel
3) Move into a rental to free up cash flow and rent out our PPOR to cover the mortgage (it would) but still maintain this apartment as PPOR status to avoid paying CGT (up to 6 years I think)
Option 3 sounds like the best of both worlds but I dislike paying rent, dead money and all that.
So if you had to choose in investing exclusively in your PPOR vs IP/Cash Flow, how did things play out for you?
Thanks in advance, I look forward to contributing back soon!
I admit to feeling a bit guilty my first post here is a question, thanks in advance for any assistance
Over the last four weeks my fiance and I have come to a fork in the road which I think boils down to Net Worth in PPOR vs Cash Flow and what I would like to know is have you ever had to make this choice? How did it work out?
The story so far:
A few years ago we bought our home in Perth and then a small commercial unit, sold both for a healthy profit, moved to Melbourne and put all the proceeds into our current PPOR; an apartment in Melbourne valued at $975k less $340k mortgage. We're spending 45% of our income servicing the loan and outgoings.
Our lack of cash flow is preventing us from getting an IP and traveling as much as we'd like.
1) Sell our PPOR and buy something less expensive to free up cash flow for IP and travel
2) Keep our PPOR and struggle through building our equity in it, borrowing against that to travel
3) Move into a rental to free up cash flow and rent out our PPOR to cover the mortgage (it would) but still maintain this apartment as PPOR status to avoid paying CGT (up to 6 years I think)
Option 3 sounds like the best of both worlds but I dislike paying rent, dead money and all that.
So if you had to choose in investing exclusively in your PPOR vs IP/Cash Flow, how did things play out for you?
Thanks in advance, I look forward to contributing back soon!