There’s a growing trend that’s helping Aussies crack into the property market, without sacrificing their lifestyle. And no, it’s not cutting out smashed avo from their diets.
The term is “rentvesting” and put simply, it means you own a home – but live somewhere else.
Rentvesters have both a mortgage and lease, which might sound like more hassle than hustle, but the practice is actually a solution to a very common problem.
As money expert at Finder.com.au Bessie Hassan explains, it gives buyers “a taste of the best of both worlds”.
Listen: Are you living a lavish life of daily brunches? No wonder you can’t buy a house. (Post continues.)
“Rentvesting is a trend that’s really taken off in recent years and it’s probably one that we’re going to be hearing a lot more about in the coming years with the property market getting more and more competitive,” she says.
“Young Aussies are looking to other options to break into the property market and rentvesting makes this possible.
“Essentially rentvesting is where you buy a property in a more affordable suburb and then rent in your desired suburb, which might be close to transport or close to work. That allows you to maintain the lifestyle that you want.”
Hassan says the rent may not cover the cost of renting another property, but this can still make sense as often the the focus is on the investment opportunity of owning a home.
Top Comments
Great article. It makes sense to be looking at all possible investment options and this presents a perfect way to invest and also maintain your lifestyle. A couple of things to note will be to look out for capital growth potential and not just affordability and also consider the rental yield in the short to medium term as you'll have to be able to maintain the investment, with less out of pocket expenses, to be able to realise a meaningful gain in the long term. Also, seeking the appropriate money advice through a qualified financial adviser may help young professionals realise the potential in their superannuation for this strategy over the long term. Worth looking into.