One in four property buyers choose “rentvesting”
"Rentvesting" is popular, but the proportion of buyers choosing this strategy has fallen.
New research from Mortgage Choice shows that 27.6% of property investors purchased an investment property before choosing to become owner-occupiers. While the strategy remains popular among buyers, the proportion of “rentvestors” has fallen, Mortgage Choice said.
The company’s annual Investor Survey found that the proportion of buyers choosing to buy an investment property before an owner-occupied property fell from 36.1% in 2016 and 37.1% in 2015. Mortgage Choice chief executive John Flavell put the changes down to moves by lenders to curtail property investment.
“In recent months, a lot of Australia’s lenders have made adjustments to their investment policy and pricing, which has made it harder for some borrowers to secure this type of finance. Australians are becoming increasingly concerned that they won’t be approved for an investment loan and, as such, are choosing to bide their time and put their property investment plans on the backburner,” Flavell said.
However, Flavell said that the fact that more than a quarter of buyers chose to invest before buying an owner-occupied property was still significant.
“When you consider how much property prices have risen across the different markets in recent years, it can make sense for some borrowers to look at buying an investment property before an owner-occupied home,” he said.