When to start?

[seano87]

Hi all,

I've recently purchased my first PPOR with my partner for $423,000. We paid with a 20% deposit and got an IO loan, parking all our cash in an offset.
Together we bring in about 100k (after tax).

We set up the loan as an IO structure, because we would like to buy a new PPOR in the future and rent this one out, maximising the tax benefits.

I'm trying to determine when we should move and rent this house out. How much should we have paid off (ie; sitting in the offset)?

 

[Aaron_C]

You should move when you need to move.....you got a good position to start off with!

 

[tobe]

there isnt a specific amount you should have paid off, its more that with the benifits of negative gearing, you could potentially pay off a heap more if it were rented out.
Alternatively you could buy a smaller investment property in the meantime, leveraging off the equity you have in your current home.

 

[Cammclellan]

I'd bring your LVR up to 90-95%. Enjoy paying LMI and use any lazy equity (keeping a small buffer of cash) and use the additional funds for deposit and cost on 1 or 2 mor IP's.