Converting PPOR to Investment & Downsizing

Discussion in 'Accounting & Tax' started by Pleasure Paulie, 15th Jun, 2019.

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  1. Pleasure Paulie

    Pleasure Paulie Well-Known Member

    Joined:
    13th Jul, 2015
    Posts:
    61
    Location:
    QLD
    The property that I live in is fairly big and somewhat not fit for purpose after a divorce a few years ago so considering my options for Brisbane are either:

    1. Renting a smaller pace & converting to an investment
    2. Purchasing a unit/flat/townhouse and moving this to an investment

    My concerns are related to "unscrambling the egg". I have around 200k of debt left on this property (and some cash in the offset account) - worth about $550k+ I have another property too which is an investment only. So if I purchase another property or borrow against this my debt will be HIGHER for my new PPOR but SMALLER for my what is now an investment property as I couldn't get a unit for under 200k.

    Would you suggest renting is perhaps a better idea? I've never rented before so have concerns regarding it, but at the same time I'm also concerned about buying a unit/flat/townhouse in the current Brisbane market. There is also the issue of moving this loan to another I/O may be an issue.

    Thanks for your help!
     
    Pleasure Paulie, 15th Jun, 2019
    #1
  2. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

    Joined:
    14th Jun, 2015
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    10,653
    Location:
    Gold Coast (Australia Wide)
    suggest you have a broker and accountant look at the options.

    Should be a simple, but not obvious outcome from the numbers

    ta
    rolf
     
    Rolf Latham, 15th Jun, 2019
    #2
  3. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    Terry_w, 15th Jun, 2019
    #3
    craigc likes this.