Thursday, July 13, 2017

The rise of the ‘Rent-vestor’

Gen Ys are proving that perhaps, they really can have it all. And not just when it comes to breakfast and smashed avocado... but in property too. 

Let me explain.

If you are a 20-something year old, with a good job, living in a capital city across Australia, chances are you're looking to buy a property. However, the current climate makes this particularly challenging, especially if you live in Sydney or Melbourne. But the best thing with Gen Ys is, they don't see hurdles... they see ways to get around them.

The hurdle. Housing affordability coupled with the fact that Gen Ys want to be close to the action. Living near the CBD, beach or a trendy metropolitan neighbourhood is the dream location, but purchasing nice homes in these areas is simply unattainable for the vast majority of people in today's property market.

The solution. Gen Ys have found another way, where they can have their cake and eat it too. Introducing... the 'Rent-vestor'.

A Rent-vestor is a person who chooses to rent a home to live in, whilst buying investment properties to rent out. Essentially this results 
in getting 'the best of both worlds'.

The logic. By renting, Rent-vestors can afford to live in their area of choice, and they don't have to compromise on the modern kitchen or the second car park. A 12 month lease means it's super flexible. They're not tied down and can pick and choose new trendy areas, or relocate for career opportunities. And the best part is, it's all without having the hefty mortgage repayments that would come with owning that particular home. And while they are enjoying the perks of renting their dream home, they've purchased a modest unit - one with good growth potential, in an up and coming area. This property requires a reasonable (but achievable) deposit, and the Rent-vestor starts receiving a rental income that covers the mortgage repayments. And in a few years? The Rent-vestor's goal is to achieve capital growth as this will allow them to draw equity from their investment property, to in fact buy their dream home in their suburb of choice.

Hurdle. Overcome.

A simplistic view, yes. But on the whole, it is proving to be a creative way to achieve a win-win. The Rent-vestor gets to experience the financial security of home ownership, with the flexibility of renting. Unprecedented housing growth has created a new era of property ownership right across the country. Rent-vestor, aka genius.

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