Buying your first home in Australia can feel impossible. With skyrocketing property prices, saving a deposit for your dream home might seem out of reach. But what if there was another way to get into the property market without sacrificing your lifestyle? That’s where rentvesting comes in.

What Is Rentvesting?

Rentvesting is when you rent where you want to live and buy an investment property somewhere more affordable. Instead of waiting years to afford your ideal home, you become a property investor while continuing to rent in a location that suits your lifestyle.

How Does Rentvesting Work?

Here’s how it typically plays out:

  • You rent in a suburb or city you love (close to work, family, or amenities).
  • You buy an investment property in a more desirable or affordable location.
  • You rent out your investment property to help cover mortgage repayments and with the plan to build equity.

Why Choose Rentvesting?

  1. Affordability: You can get into the property market sooner by buying in a more affordable
  2. Lifestyle: You keep living where you want without compromising on location.
  3. Investment Growth: Your property has been selected with the aim to increase in value, building wealth.
  4. Tax Benefits: You may be able to claim tax deductions on expenses for your investment property, reducing your taxable income.

Example of Rentvesting

Let’s say you live and work in Sydney, where property prices are too high. Instead of spending years saving for a deposit on a home in Sydney, you buy a more affordable investment property in Brisbane or a regional area. The rent from your tenants helps pay the mortgage, and you continue renting in Sydney. Meanwhile, you are building up equity from the growth in value + rental income.

Is Rentvesting Right for You?

Rentvesting isn’t for everyone. Consider it if:

  • You want to get into the property market sooner.
  • You value flexibility and lifestyle.
  • You are comfortable being a landlord.
  • You want to buy a property but where you currently live is too expensive

However, it may not suit you if:

  • You prefer the stability of owning your home.
  • You don’t want to manage an investment property.

Key Things to Keep in Mind

  • Research the Market: Make sure the area you invest in has strong rental demand.
  • Consider the Costs: Factor in maintenance, property management fees, and loan repayments.
  • Understand Taxes: Negative gearing and capital gains tax can affect your returns.

Rentvesting is a clever strategy for Australians who want to enter the property market without putting their lifestyle on hold. By renting where you love and investing where you can afford, you get the best of both worlds — a foot on the property ladder and the flexibility to live where you want.

If you’re struggling to buy your first home, rentvesting could be the game-changing strategy you need to start building wealth today.

We can help you get the best deal for your mortgage! Contact us today to learn more.