Are first home buyers the new investors?

It might’ve been a while since young Aussies thought of buying a home as a real option, but the trend is on the up once again. Research has reported an upward swing in first home buyers, from apartments to blocks of land, just so they can get into the real estate market.

First home buyer numbers have hit a six-year high of 29.8% in August, in terms of new borrowers. According to Australian Bureau of Statistics figures, about 18% of Aussie properties financed in September were for first home buyers. The new data has started counting all first-time buyers, not just the ones receiving the First Home Owner Grant. 

And while first home buyers tend to buy a property to live in, for many this is just the first of many stepping stones to building a real estate portfolio. 

According to the 2018 Property Investment Professionals of Australia survey, 36% of property investors in 2019 were actually first home buyers, who were opting to invest in one property and continue renting another. This trend of ‘rentvesting’ – AKA renting a place that suits your needs now while investing in a property that will deliver better ROI in the long-term – is an exciting prospect that many first home buyers are adopting. Instead of using the purchase of a home as another checkbox on the adult timeline, first home buyers are being smart about what they buy, where they buy it, and how it will help them become financially independent in the long run.

So what should first-time home buyers look for if they’re keen to keep their investing options open? Let’s have a look.

Rental appeal

Is your desired home in a place where there’s a strong rental market and growing population? Are there schools, hospitals, and parks in the area? What other features of your location could be useful when looking to rent or sell down the track? And let’s not forget to consider the potential rental yield of your investment property, given this will influence the amount of cash flow rolling in to help service your loan repayments.


Don’t knock the idea of going outside the city for your first home purchase. In fact, most people who rent tend to lean outside of the city given the high cost of inner city housing. And for a first-time mortgage, opting for something in a good neighbourhood with good infrastructure, not to mention an acceptable outside-the-city price tag, will be a much easier bite to swallow. 

Capital growth

If you’re not across this term, then make sure you are by the time you sign on the dotted line of your first home loan. Being aware of the capital growth trends in similar properties in the area is crucial to confidently buy in an area that’s moving up – not down – the popularity ladder. 

Expert advice

The world of property investment is not the easiest to navigate so it helps having some experts in your corner. Property gurus have the inside track on real estate trends, interest rates patterns, financial advice and tips to spotting a winner. Not to mention getting your head around all the tax and legislative rules that come with both first-time buying and investing.

Financial experts everywhere are spouting the benefits of using your first home buyer status as a way to leap into the property investment pool. The Australian Government’s new First Home Loan Deposit Scheme that comes into play from January 2020 will even allow 10,000 eligible first home buyers to secure a loan with a 5% deposit and no lenders mortgage insurance. So you don’t even need to be hell bent on investing right now – you could use your newbie status as a way to land a sweet property to live in before leveraging it for future property purchases. 

The possibilities really are endless if you’re looking to plunge into the deep end of home ownership.