Average Aussie investor isn’t who you think

Apr 2024Karen Millers

Australia’s landlords aren’t who you probably think.

The public image of investors is often older Aussies building a nest egg for retirement or cashed up institutional buyers, but turns out they’re increasingly 20- and 30-somethings who are also tenants.

New Commonwealth Bank research indicated those born between 1981 and 1996 were the most active group buying investment properties, accounting for 46 per cent of investor purchases in 2023.

And about a third were buying their properties alone, without the help of a partner.

CBA said investors were getting younger because of a growing inclination to “rentvest”.

This involved the investors buying where they could afford, while continuing to rent in locations they deemed more desirable to live in.

Others, spurred by social media, saw property investing as a way to create wealth and retire early.

CBA manager home buying Michael Baumann said rentvesting gave Australians the chance to get their foot on the property ladder sooner.

“(They) purchase a property in a lower cost area without having to give up the lifestyle they have become accustomed to when renting,” he said.

Many employing this strategy were hoping their investment would become a stepping stone to their dream home.

The hope was they could capitalise on the value growth in a few years by selling and diverting the funds to a new residence.

Property Investment Professionals of Australia chair Nicola McDougall said it wasn’t surprising more millennials were investing given improved access to financial data.

“Their generation has probably been more exposed to property investment strategies than any generation before them because of the proliferation of content readily available,” she said.

Among the new generation of investors who have clawed their way into the market is Lachlan Vidler, who bought his first investment property aged 22, while serving in the navy.

Now 28, the Sydney-based investor said his plan when we was 22 was to focus on where he could afford, which meant looking outside the Harbour City to the Ipswich area southwest of Brisbane.

He said he gained much of this investment knowledge through podcasts and by age 25 he already had three properties.

Sanjay Parasher, 29, started investing in his mid-20s and said he got educated about the topic from YouTube. He now has 37 properties.

“I literally learnt it all off YouTube,” he said. “All the information you need is out there, you just need to apply it … I think more younger people should invest because trying to buy (a residence) is becoming too expensive.”

Originally Published: Aidan Devine | news.com.au | 8 April 2024


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