Across Australia, a new trend is making major inroads into the nation’s property market.
Called rentvesting, the strategy has seen families and individuals buying properties but choosing not to live in them. Instead, they opt to rent another property and live there.
So popular is the approach that 15% of all private tenants are now rentvestors. Stats also show that more than 40% of investors have considered or will consider rentvesting.
But why is rentvesting so popular?
The main reason is that renting enables someone to enjoy the benefits of living in a desirable area where they might not otherwise be able to afford to buy a home. Meanwhile, as a rentvestor, they can still get into the property market and build wealth through their real estate investment.
Effectively, you get to have your cake and eat it.
Here are our top 5 reasons why many Australians are turning to rentvesting:
- Affordability
Rentvesting helps people live in their preferred area (close to work, amenities, or better schools) without needing to buy an expensive property in the same location. - Wealth creation
Rentvesting allows people to build a property portfolio by investing in more affordable properties in other areas, potentially generating rental income and capital growth. - Timing
Accumulating a deposit for a house in a high-priced suburb might take many years. By investing in property in less desirable areas, rentvestors can enter the market sooner. - Flexibility
Renting can offer more flexibility to move compared to owning a home, which can be advantageous for people with changing lifestyle needs or job locations. - Financial strategy
Rentvesting can be part of a broader financial strategy to diversify investments, leverage tax benefits, and manage cash flow more effectively.
Overall, rentvesting is a way to balance your lifestyle preferences and your financial goals, especially in high-priced property markets.
If you’re interested in entering the market as a rentvestor, be sure to speak with Bravo Homes about why a house and land package is the ideal choice for the astute property investor.