Selling an IP to pay down non deductible debt Sometimes it may be worthwhile to sell an investment property as the proceeds can be used to debt recycle - pay down the non deductible debt and reborrow to invest. Property is generally only a good asset to hold when it is leveraged. A $1million property may return about 3% in rent pa. So once you have a low LVR you can possibly use that equity which is tied up to invest further. You can simply borrow against the property, but interest on any loan taken out to do this would be deductible against the income the borrowed money is used for. e.g $1mil property with a $100,000 loan Increase the loan to $800,000 to invest in shares. The interest on the extra $700k borrowed is deductible against the shares, not the rent of that property. This means you are still lowly leveraged against the property. You could sell it use the money to pay down the PPOR loan, pay the CGT and borrow against this to buy the shares. A property owned may also be a dud - sometimes it is best to get rid of a dud and invest in something better. There may also be structure issues with potentially mixed loans and other deductibility of interest stuff ups. land tax may be high too and selling and buying again could help you save a fortune in land tax. Combine any of the above reasons with a period of no or low income could mean any CGT may be minimal. There are also other strategies which could be used to reduce the CGT. You just have to weigh up all the reasons and then run the numbers and see how much better off financially you could be if you sold that property. Work out Selling costs CGT Interest saved on the main residence loan Tax savings one the new loan Purchase costs of the new property Your ability to borrow again Once you have worked out the costs then work out how long it would take you to recoup those costs and then assess if it would be worthwhile to sell and buy again. If you could save $10,000 per year in tax, but it would cost you $80,000 upfront would it be worth it - this sort of thing.