Young property buyers are ‘rentvesting’ to beat the housing affordability crisis by renting where they want to live and buying where they can actually afford.
The trend will no doubt become increasingly popular among young and first-home buyers as house prices in Melbourne continue to rise.
A new report from Westpac has found the rentvestors are already an established category of property buyer in Sydney, where prices have long been out of touch for many buyers.
Westpac’s Lauren Fine told News.com rentvesting had arisen in response to soaring house prices, and it was especially popular with young men.
“Many young Australians are looking at savvy ways to get into the property market, showing that there’s still clear aspiration for home ownership while maintaining their lifestyle,” she said.
“Rentvesting presents choice and flexibility, whether these homeowners live with parents or rent in a location that’s suitable to them, their needs and lifestyle.”
“From our research we can tell men – not just those who are rentvesting – are often more open to having a diversified investment plan.”
Finder.com has put together a quick summary of the pros and cons of rentvesting for those thinking of the idea.
PROS
Enter the property market sooner
Live the lifestyle you want
Build wealth and an investment portfolio
Save for a dream home later down the track
Enjoy the flexibility of renting
Investment property tax benefits
Choosing where to invest which may be a better option for capital growth than where you want to live
CONS
Buying an investment before your own home feels counter-intuitive
Dead rent money
You don’t own your own home
You can’t change you own home
