Where to now?

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From: Kal Gould


Hi all,
I am a new user of this site and have found the info quite helpful.

My dilemma.

I have one IP valued at 230K returning $250 p/w. It has good depreciation attached due to renovations recently performed. I also have the family home valued at 340K. Both are in a good capital growth area. Borrowings are 175K on IP, 170K family home and a LOC at 61K, total 406K. All are cross colateralised. Our combined income is 115K before tax. Savings are around 10K

I am thirsty for more IP's and we need a larger house for the family. (Extending current house is not an option)

Do I,
(a) Rent out family home, rent ourselves and use equity for more IP's?

(b) Sell family home, buy again and try for another IP with what's left?

(c) a combination or other suggestion?

I am able to do 80% of renos and would also like to try my hand at speculation.

Regards........Kal
 
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Reply: 1
From: Duncan M


Hi Kal,

Based on those figures, you could borrow another $555K for property, worked
out thus:


Total Value of Properties = 570K
Total Debt = 345K
Current LVR = 60.5%

Borrowing 111K would take you back up to an LVR of 80%

$111K geared at 80% is $555K


Given that you could still possibly get LMI (and I would if you could to
maximise your borrowings) you may indeed be able to go much higher. You have
great serviceability.

Dont rent, buy a new home and turn your existing home into your next IP.
Dont sell, never sell.


Thats my thoughts.

Duncan.




-----Original Message-----
From: propertyforum Listmanager
[mailto:listmanager@bne003w.webcentral.com.au]
Sent: None
Subject: Where to now?


From: "Kal Gould" <kalgould@ozemail com .au>

Hi all,
I am a new user of this site and have found the info quite helpful.

My dilemma.

I have one IP valued at 230K returning $250 p/w. It has good depreciation
attached due to renovations recently performed. I also have the family home
valued at 340K. Both are in a good capital growth area. Borrowings are
175K on IP, 170K family home and a LOC at 61K, total 406K. All are cross
colateralised. Our combined income is 115K before tax. Savings are around
10K

I am thirsty for more IP's and we need a larger house for the family.
(Extending current house is not an option)

Do I,
(a) Rent out family home, rent ourselves and use equity for more IP's?

(b) Sell family home, buy again and try for another IP with what's left?

(c) a combination or other suggestion?

I am able to do 80% of renos and would also like to try my hand at
speculation.

Regards........Kal



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To start a new topic: mailto:propertyforum@bne003w.webcentral.com.au
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Reply: 1.1
From: Duncan M



Whoops, I missed the LOC you mentioned.. hence your debt is higher, given
you potential borrowings of around $55K or about a $250K purchase if you
geared it.

Sorry about that.

-----Original Message-----
From: propertyforum Listmanager
[mailto:listmanager@bne003w.webcentral.com.au]
Sent: None
Subject: RE: Where to now?


From: Duncan Margetts <duncan.margetts@cispl.com.au>

Hi Kal,

Based on those figures, you could borrow another $555K for property, worked
out thus:


Total Value of Properties = 570K
Total Debt = 345K
Current LVR = 60.5%

Borrowing 111K would take you back up to an LVR of 80%

$111K geared at 80% is $555K


Given that you could still possibly get LMI (and I would if you could to
maximise your borrowings) you may indeed be able to go much higher. You have
great serviceability.

Dont rent, buy a new home and turn your existing home into your next IP.
Dont sell, never sell.


Thats my thoughts.

Duncan.




-----Original Message-----
From: propertyforum Listmanager
[mailto:listmanager@bne003w.webcentral.com.au]
Sent: None
Subject: Where to now?


From: "Kal Gould" <kalgould@ozemail com .au>

Hi all,
I am a new user of this site and have found the info quite helpful.

My dilemma.

I have one IP valued at 230K returning $250 p/w. It has good depreciation
attached due to renovations recently performed. I also have the family home
valued at 340K. Both are in a good capital growth area. Borrowings are
175K on IP, 170K family home and a LOC at 61K, total 406K. All are cross
colateralised. Our combined income is 115K before tax. Savings are around
10K

I am thirsty for more IP's and we need a larger house for the family.
(Extending current house is not an option)

Do I,
(a) Rent out family home, rent ourselves and use equity for more IP's?

(b) Sell family home, buy again and try for another IP with what's left?

(c) a combination or other suggestion?

I am able to do 80% of renos and would also like to try my hand at
speculation.

Regards........Kal



To reply: mailto:propertyforum.31883@bne003w.webcentral.com.au
To start a new topic: mailto:propertyforum@bne003w.webcentral.com.au
To login: http://bne003w.webcentral.com.au:80/~wb013


To reply: mailto:propertyforum.31885@bne003w.webcentral.com.au
To start a new topic: mailto:propertyforum@bne003w.webcentral.com.au
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Reply: 1.1.1
From: Les .



G'day Kal,

You asked:-

"Do I,
(a) Rent out family home, rent ourselves and use equity for more IP's?

(b) Sell family home, buy again and try for another IP with what's left?

(c) a combination or other suggestion?"



Main question is "What are your priorities?" Using Jan's example, you could live in a tent and own 20 IP's, or live in a mansion and own 1 IP" (or something like that - sorry Jan ;^)

If saving/making money is highest, then I am convinced you will do better by renting out your own home, and renting a property for yourself. Hopefully this would also fit in with a lifestyle requirement too (e.g. rent a bigger house or closer to work, or whatever....) Gear up by further borrowings on your current "own home - soon-to-be rental" to fund your other IP purchases. Also, depending on your risk profile, current disposal income, etc you might want to consider 90% lends rather than 80%.

What area are you in??

Regards,

Les


- "Eschew Obfuscation" - ;^)
 
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