Sell and Buy, or Re-mortgage, rent and buy???

Hi All!

My first post, and hoping to get some help with what to do going forward;
Currently, I have a 2 bedroom house in a good area of Albury NSW. Sale value would be close to $400k and I currently owe $175K on it with 29.5 years left (Recently re-financed to re-do the roof)
My rental return on this would be around $330-$350 a week. Potentially more, as it needs to be re-painted (external weatherboards) and will come up a treat after tipping another $10k into it!

My partner and I just had our first baby and are looking for something bigger in the next 12 months.

I'm not sure if I should re-finance this again and use the funds for a deposit to buy another property to live in or just sell up and buy something else?

What are your thoughts? To buy what we are after, we would be looking at approximately $650k (maybe less)

Any help / advise / things to consider would be appreciated.

Thank you all!!!

 

Just note if you refi for the deposit, that interest is not deductible. Ie you will be taking on 650k of non deductible debt.

otherwise not enough detail. Income? Borrowing capacity? Cash?

 

Welcome aboard & congrats on the new addition!

I'd look at a couple of things:
1) Do you think the long term prospects for that property and the estimated rental yield make sense for you to hold it for the long term? (compared to either buying the next property with a lower level or debt, or allocating funds into other investment(s)
2) Have you done the numbers on what you're able to borrow if you hold the existing property? (this may make the decision easier if the numbers won't work!)

 

Thanks for your replies.

More details
The house I own (have a mortgage on) is in a great spot. I purchased it for $235k about 8 years ago, and have tipped probably 60k into it.
Income is about $90 before tax
Obviously the other half is on mat leave, but prior to that, it was about $80k
I can borrow close to $700k but i don;t really want to stretch it out that far and become a slave to the house!

I hope this helps?

 

700k will make you a slave to the house, and 650k wont?

235+60 cost with a market value of 400 over 8 years isnt a great return.