Keep current PPOR as an IP vs sell and invest in ETFs?

Hi all,

Hoping to get some opinions and perspectives while we line up a financial adviser in the new year.

Current situation: - Couple both 31, 1 child (2yo) - Household income expected to be ~$270k next FY - My income ~$230k (sole trader) - Wife ~$40k (3 days/week) - Adelaide (inner suburbs) - Current home: - 3-bedroom PPOR - Approx value $900k - Mortgage owing ~$540k - Cash: - ~$55k in offset - ~$20k in HISA (quarantined for business tax) - Liabilities: - Car loan ~$25k remaining - Monthly household expenses ~$9k (includes mortgage + car)

Plans: We’re hoping to move into a larger home around July next year.

Spoken to a mortgage broker who indicated: - Borrowing capacity of ~$850–900k if we keep our current home - ~$1.1m if we sell our current home first

Option 1 – Keep current home: - Buy a new PPOR around $900k–$1m using equity for deposit - Convert current home into an IP - Expected rent around $700/week - Current mortgage is ~$3.2k/month, so it would be negatively geared

Option 2 – Sell current home: - Sell PPOR - Buy a $1–1.2m home - Invest remaining surplus into ETFs (VAS/VGS or similar)

What I’m unsure about: - Whether holding a negatively geared IP at our stage of life makes sense vs simplifying and investing through ETFs - Risk of being asset-rich but cash-flow constrained - Balancing lifestyle (bigger home + renovations) vs long-term wealth creation

We’re planning to speak with a financial adviser, but keen to hear any thoughts.

Thanks