2nd IP or PPOR

This definitely is a different state, very different 

Thanks Angel. I think I might be confusing myself with tax benefits; trying to buy outright so that we don't have to pay rent (as a non deductible expense, if we do end up moving) while still being able to use equity from ppor to finance other IP's, as per one of Terry's strategies. Does that make sense?

My partner would be very excited to attend the meetup. When is the next one? I guess I'm lucky that she doesn't fancy super fine things and fancy homes so we can inject our capital somewhere else.

 

Exactly what I'm afraid of and what I constantly have in the back of my mind

What if/when the good days end..

 

True. I was thinking a straight forward transfer.
But if you're on a good wicket you should factor in the lower income if you're moving back to Perth and use that as a worst case and look to buy cf+ then.

Thats what we just did. Bought 2 ips that are cf+ knowing that we may have time off between contacts or if things changed we knew they would look after themselves.

You're not going to be able to do that in Perth now.

 

Unless you're happy to live there forever, it's inevitable so you need to plan for that.

 

Another state in another country

Is your job secure? Are in you construction or have sussed out how you're placed?

 

Lol.. I would add another planet too

Well I think I'm positioned very well at the moment as I'm in operations, but it just looks too good to last very long, to be honest. Hopefully I'm very wrong and I spend another 10 years in this sunny red paradise.

 

I might just play it safe then. Save hard over the next two years and buy a cheap 300k unit in Glendalough or something like that. Of course I'd monitor the market and buy close to the bottom, not now.

That way I prepare myself for the worst. Probably less reward as I'm playing it very safe, but minimun risk as well. If good times keep rolling, then I can draw equity against the unit and invest.

 

I think that's probably the worst possible thing to do but that's just me!

 

Ok I get it, you would go for scenario 2

 

Thats why cash buffers are important either savings, equity or a combo of both.

Ps. they will end and come again, its called market cycles

 

Consider some structuring strategies.

Do you keep finances separate? Could you buy the IP property in one name with that person borrowing the deposit from the other person?

This way the loan is 100%. By the time you want to buy the PPOR you will have your other cash available but the owner of the IP could increase the loan, borrow to refinance the private loan from the spouse and have the interest deductible. More cash for your PPOR.

Make sure you get tax advice before doing this.