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Investor trends uncovered: Who’s driving the market
As Australia’s property continues to attract investors, the market has been seeing a shift in buyers, with mid-career and older landlords shaping investment patterns and highlighting who’s buying and where.
Investor activity has been on the rise over the last 18 months, reaching its highest share of new lending over the past 8 years.
REA Group's PropTrack-Terri Scheer Investor Report showed that property investing has become more common over the last 40 years, with one in seven Australians being a landlord.
The report showed that in the 1978–79 financial year, about 4.1 per cent of the population reported receiving rental income, while this number more than tripled in the 2022–23 financial year, reaching 14.1 per cent.
Recently, investor activity has risen further, reaching its highest share of new lending since 2017, fuelled by tight rental conditions, strong rental yield, renewed confidence and multiple RBA rate cuts
But who invests?
The report found that most property investors own one or two properties, with about two-thirds holding a single investment and another fifth owning two.
Large portfolios are an expectation of the norm, with only 4 per cent owning more than four properties and around 1 per cent holding more than six.
Age-wise, the majority of property investors are aged between 35 and 64, accounting for seven-in-10 households, while investment in younger generations is underrepresented.
According to the report, the investor population has aged significantly over the past two decades, as mid-career, higher-earning households have both the financial capacity to invest and greater benefit from negative gearing.
Notably, 28 per cent of top-income households own investment properties compared to just 6.5 per cent of the lowest-income group.
Yet, the number of investors under 40 has steadily declined over the past two decades, shifting from the largest investor age group in 1999/2000 to the smallest today.
Among first-time buyers, rentvesting has become more common in NSW but remains rare in other states, as nationwide, only 4-5 per cent of investor purchases are made by first-home buyers.
While older investors might eventually sell their properties upon retirement, the trend of increasing retirement ages and higher workforce participation among those aged 65 continues.
The report said that later retirement has encouraged more Australians over 60 to stay active in property investment, with ATO data showing their share of investors rising from 14 per cent in the early 2000s to 27 per cent today.
However, investment property ownership drops sharply after retirement, particularly among those aged 75 and older, as the benefits of negative gearing diminish without employment income to offset.
Investment barriers: what is the largest expense for landlords?
While government policy, regulations and taxes have been key deterrents in building investors' portfolios, interest rates remain the largest expense for landlords.
In 2022/23, investors reported interest costs averaging just over 40 per cent of gross rental income, lower than typical due to unusually low early-year interest rates, compared with around 60 per cent in 2012/13.
Beyond interest, Insurance premiums rank seventh among landlord expenses, commonly covering loss of rent, tenant damage, and escape of liquids.
Additional major expenses include depreciation, repairs and maintenance, council rates, agent fees, and strata fees, with depreciation on “plant” assets declining slightly since its 2017 peak.
Where are they investing?
Investor activity in New South Wales remained strong, with loans up 12 per cent in 2025, driven by suburbs offering high capital gains, strong rental yields, and robust tenant demand.
Top-performing areas for houses include Tumbi Umbi, Werrington, and Austral, while units in Lakemba, Bankstown, and Wiley Park show fast leasing, strong price growth, and attractive rental returns.
In Victoria, activity increased by 9 per cent in 2025, driven by suburbs such as Cranbourne South, Meadow Heights, and Coolaroo for houses, and Notting Hill, Sunshine, and Broadmeadows for units, all demonstrating strong growth and yields.
While activity has risen more slowly than in other states, partly due to recent land tax increases, Victoria’s relative housing affordability may drive greater investor interest in the future.
Property investment in Queensland jumped 16 per cent from 2024 to 2025, driven by strong renter demand and attractive capital gains and yields.
Houses in North Booval, East Ipswich, and Kilcoy and units in Beenleigh, Slacks Creek, and Woodridge led the market, delivering above-average price growth and rapid leasing.
In South Australia, investor activity grew 16 per cent, supported by strong price growth, higher rental yields, and quick leasing times.
Top-performing suburbs include Evanston Gardens, Elizabeth North, and Evanston for houses, and Brooklyn Park, Camden Park, and Morphett Vale for units, all delivering above-average gains and prompt rentals, while Adelaide’s relative affordability continues to attract investors.
Investor interest in Western Australia grew 10 per cent in 2025, with Perth seeing strong house and unit price growth, high rental yields, and fast leasing times.
Leading Perth suburbs for houses were Midvale, Cannington, and Stratton, while units performed best in East Cannington, Hamilton Hill, and Cloverdale, delivering strong growth and high yields that appeal to investors.
