ABOUT one in three property investors are buying their first real estate investment before the age of 32.
Rising property prices have forced many first-time buyers away from the great Australian dream of buying their own home, opting for investment properties instead.
Mortgage Choice has found that in 2013 about 29 per cent of first-time property buyers were aged under 32. Forty-four per cent were aged between 32 and 45, and the remainder were 46 years or older.
The amount of entry-level buyers getting a leg onto the property ladder has increased in recent years – in 2011 just 19 per cent of first-time investors were aged 32 and under. Mortgage Choice spokeswoman Jessica Darnborough says it is now far more common for entry-level buyers to become investors before they are owner-occupiers.
“We expect, as property prices continue to rise in the capital cities (where younger people wish to live) we will continue to see an increase in the number of first-time buyers purchasing investment properties,’’ she says.
Loan Market director Mark De Martino says about 30 per cent of their inquiries about property investment comes from Gen Ys.
“We’re seeing more Gen Y investors coming into the market often as first-home buyers,” he says. “For a young professional with a good income, no debt and ample savings, buying an investment property is a great way to get into the market and build equity very quickly.”
He says capital cities are good places for investors to buy property, particularly given the current market conditions.
“The economic conditions in most capitals are favourable for investors with rental yields high and vacancy rates low,’’ De Martino says. “All-time low interest rates are one of the biggest factors encouraging Gen Y to invest in property.
“For Gen Y, or any other demographic, it’s an ideal situation to live rent-free and built equity in another property.’’
Original article by Sophie Elsworth from Newscorp Australia