strategies for investment - which is best?

[mitchp]

I want to build some wealth (surprising idea isn't it!). My situation is: I have reasonable equity in my home. I'm looking at a few possibilities - either 1) buying investment property and renting it out while I continue to live in my home OR 2) buying another property to live in and rent out my home. Qu: Oh extremely knowledgable/wise Forumites: in your opinion(s) what are the costs/benefits of these 2 strategies in relation to growth, taxation etc?
Cheers
Mitch

 

[TheCamel]

or, move out into a rented premises, and rent out your existing property.

you'd normally look for a place to live where you are ideally paying equal or (preferably) less then the rent you are receiving on your property.

this is what i ido - i'm renting somewhere for 300pw, and have a tenant paying 300pw for my apartment.

 

[twobobsworth]

1) buying investment property - deductible
2) rent out my home - not deductible

 

[TheCamel]

why do you say it's not deductible to rent out your home.. ?

 

[BayView]

I think what 2 bob's worth means is that if you rent out your house, and buy another house to live in, then the loan on the house that you have just bought to live in is non-tax deductible.

A further option would be to move out of your existing home and rent it out while you rent somewhere yourselves; hopefully for less than you get from your house.
Then, buy another I.P as well using the existing house's equity as part of the payment (or all if there is enough equity).

This way, you will be renting yourselves, but will have two I.P's ticking along.

The interest on the loans on both properties, as well as all the holding costs are tax deductible this way.

 

[Liverpool St]

Rent PPOR

A further option would be to move out of your existing home and rent it out while you rent somewhere yourselves; hopefully for less than you get from your house.
Then, buy another I.P as well using the existing house's equity as part of the payment (or all if there is enough equity).

.

Does anyone have a spread sheet that will give figures on renting out your PPOR and renting somewhere else, taking into account depreciation, interest repayments on existing property and rental to be paid on rental property

Thanks

 

[mitchp]

Some good ideas - not sure which way I'll go but I appreciate the feedback. Cheers