“How are our kids ever going to afford to buy property?”. This question is asked every time we sell a property for a new benchmark.
One strategy for many first home buyers is rentvesting. It’s a strategy that sees them buy a property where they can afford to buy, usually in a location a lot further away from where they want to live. Then, rather than live in their new property, they are renting it out to a tenant and renting themselves in their preferred suburb. This allows them to share rent and costs, while enjoying the benefits of a central location.
It’s being driven by a rising property market that is proving the sooner a buyer gets into the property market, the sooner they can benefit from the capital growth that has been so consistent over the last few years.
One of our property managers couldn’t afford to buy in Brisbane, so they bought in their home town of Tamworth. They paid $270,000 in 2018 and today it’s worth about $450,000. That’s nearly a $200,000 uplift and has now given them the equity to buy in Brisbane.
The tip to rentvesting is to know where you are buying. The further you drive from the city, usually the more affordable the property. Do your research, drive the area and talk to friends that live there. Plan to buy and then never sell.
That first property purchase is the hardest. You need to save up your deposit, against a rising market, while you’re navigating the cost of living.
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I always like the question, “Where should I buy?”. I think it’s because there are so many great places and so many different reasons why one property or area would suit a person. Surprising to a lot of people is the first question, “where did you grow up?”. This usually … Read more