Insight: The difference between younger and older investors in this market

A property educator has shared her insights into how the latest generation of younger and older investors are making decisions about property, so you’re skilled up when facing bidding competition.

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According to Helen Collier-Kogtevs of Real Wealth Australia, there is a clear distinction between the new generation of younger investors and older investors.

The young

Younger investors, according to Ms Collier-Kogtevs, have broken the taboo of renting and investing in property at the same time, or rentvesting; that “being a tenant is no longer a dirty word”.

“What I’m finding now is those that are new coming into the market are realising that renting in the area that they want to live in and purchasing investment properties, is actually a better proposition,” she said.

“The reason why is when you’re renting and you don’t have that owner-occupier mortgage, it actually increases your borrowing power, so if you rent and buy investment properties, it allows you to buy more investments versus if you were to buy your own home.”


What Ms Collier-Kogtevs said she loves about this new generation of young investors is that they are taking on the concept of rentvesting more easily than the young investors of a decade ago were.

“What I’m loving about this new group of investors coming through, when we talk about the possibility of renting while buying a whole lot of investment properties and then down the track buy your own home, they’re embracing it much easier than say 10 years ago when I was teaching this,” she said.

And the young at heart

Meanwhile, Ms Collier-Kogtevs said the pattern she has observed from the new generation of older investors is that they are considering downsizing as an option to start investing to build up a nest egg for later on in life.

“They’re realising that their big expensive homes… [are] worth a lot and they’re seeing the benefit of investing and creating that retirement fund,” she said.

“So, what I’m finding is many of them are downsizing, so they’re still living in a nice property … or they’re moving to areas that are a little bit cheaper so that they’ve got a whole lot more equity to use as deposits for investments.

“They’re starting to see the value, so the message is getting out there, that having all your money tied up in your own home isn’t necessarily the best strategy, and that having maybe a smaller home or in a slightly cheaper area allows people to invest and create more wealth for themselves in retirement.”

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