Hi All New to this. We have an LVR of 75% on our home. How do we go from here? Did we make a mistake and borrow too much? house is worth 600k. Do we neg gear? Both in our forties and want to get into investment properties and strategies as no one can pay off a loan and retire comfortably on wages alone. I am thinking we are in a no win situation and would love to know what to do. Do we sell and rent and then buy but then we would lose stamp duty,fees, etc and have less than we do now. We really want to get "on our feet" asap. How do we borrow more and get another cheaper property to start our collection of properties? Are there any major benefits to us renting and renting out our home? We would still have to put in up to between 100 - $200/wk I think to supplement rent. Thanks in advance for the advice.
Hi Tribulation Only you can make the choice regarding PPOR and whether or not to rent- it's really a lifestyle decision. 75% LVR is high but then again I don't know your personal situation. How long have you had the mortgage? Have you used equity in the past to invest? What are your long term investment goals? So many variables but it sounds as though you need to start with paying more PPOR debt down before you can access any decent equity to invest. Most lenders will allow you 80% of current value less your debt so you're not there quite yet. Rather than renting, which may well save you money, whilst you rent out your current PPOR (and remember that you can rent out your PPOR for up to 6 yrs after you exit cap gains free, as long as you don't retain another PPOR) can you add any value to your existing PPOR to create equity faster? Eg: renovate, subdivide etc. Lots of avenues to consider. Best of luck.
