rent out mortgaged apartment and rent elsewhere

Would it be a good idea to rent out my mortgaged apartment and rent somewhere else? I would be turning my PPOR into a IP.

Are there any issues to consider in this scenario?

While I like the apartment that I own, I don't like the idea of being forced to live there for the next 5-10 years. I would like to try out other suburbs, which is something you can do if you are a renter.

 

Renting gives you heaps of flexibility, u wont be tied down any location, which is kool especially if your working from home. Get your tenant & the ATO man to help pay down your mortgage. Get a depreciation schedule and combine that with the property expenses and interest component on your loan to be tax deductible against your income, which is a nice little bonus come end of financial year.

 

Hit the search function and dive into Rentvest and 6 year rule. Also depreciation schedule.

As fellow rent-vestor, I wish you good luck.

 

Do you have offset or redraw on the loan?

 

There are plenty of people that do this. If this is what you want, then go for it.

 

I have redraw but no offset. The current amount owing in the loan is about $290K due to having paid about $60 into the redraw.

 

Yep! If you are considering using this property as an IP, it may be prudent to look into this.

 

Very common scenario, it's called rentvesting (if you google the term, you'll find some relevant articles) and I know a few people that do this myself who are very happy.