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Investment Property - To buy outright or mortgage?

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Vanessa | 12 Sep 2013, 09:21 PM Agree 0
I live in my home which I own outright. I am also looking to invest in property. I have the funds available (currently earning only about 4% in term deposits and also some cash in USD which isn't earning any interest!). Am I better off buying the investment property outright or taking out a mortgage?
  • Eos Property | 13 Sep 2013, 03:29 PM Agree 0
    Are you based in the US?

    Tax rules are different between the US and Aus. I'll frame my response as if you are an Australian taxpayer investing in Australia.

    Having cash reserves parked in safe places is always a good strategic move and is it gives you a great deal of flexibility. From a wealth perspective parking cash reserves in an offset account linked to a mortgage is more advantageous to lumping money in term deposits.

    Without knowing the ins and outs of your situation; what your plans are, how old you are, family, property plans etc a more comprehensive answer is difficult to give.

    If you care to add some detail you may have others join the conversation.
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