In the competitive Australian property investment market, younger Australians are making their mark, with Millennials now at the forefront as the most active demographic in property investments across Australia, including Queensland, Brisbane, the Gold Coast, and Townsville.
The demand for mortgage and refinance options continues to surge, as shown by the Australian Bureau of Statistics, which recorded a 21.5% rise in new investor loans in February year-over-year.
Investment loans now significantly contribute to the overall growth in new mortgages over the last year, demonstrating a robust interest in property finance.
Unexpectedly, it is not the older Australians who are dominating the push for rental properties.
Millennial Investors Take Centre Stage
Recent data from the Commonwealth Bank highlights that Millennials (born between 1981 and 1996) represent nearly half (46%) of the bank’s new property investors in 2023, including those interested in mortgages for investment properties in Queensland, Brisbane, the Gold Coast, and Townsville.
A notable one in three of these investors are securing investment properties independently, without financial partners, reflecting a trend in solo property investment.
Generation X (1965 – 1980) also shows strong activity, comprising 37% of CommBank’s new investment property loans, including refinancing options, throughout 2023.
Rentvesting – A Smart Strategy for Home Ownership
Rentvesting, a strategy involving purchasing properties in more affordable areas while renting in desired locations, continues to attract individuals looking to enter the property market sooner. This approach is facilitated by accessible mortgage and refinance options.
With an average investment loan size of just over $528,000, compared to $624,000 for owner-occupiers, rentvesting makes financial sense. It allows investors to generate rental income, aiding in mortgage repayments.
This method not only helps in stepping onto the property ladder earlier but also minimizes lifestyle sacrifices, providing a feasible option for millennials seeking to balance investment and living preferences.
Current Opportunities for Property Investors
The property market currently offers ample opportunities for investors, with mortgage rates expected to decrease and property values anticipated to rise. National rental vacancy rates are at a record low of just 0.7%, and property listings have increased, giving investors, including those in Queensland, Brisbane, the Gold Coast, and Townsville, more options.
Rental rates have climbed by 11.4% across state capitals, highlighting the lucrative potential for property investors considering mortgages or refinancing.
Begin Your Property Investment Journey
Considering stepping into property investment or needing a car loan in Australia? Talk to us today to explore your options for mortgages, refinancing, or car loans, and find out how you can become a property investor sooner.
To learn more, contact Premium Finance Group Australia at (07) 4720 8888 or email us at finance@pfga.com.au.
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