Rather than missing out on the opportunity to enter the property market while interest rates are low, Gen Y first home buyers are electing to buy homes that are more affordable. These homes are typically situated in areas that are better suited to rentals rather than buying a home in a more desirable location for themselves.
Many property investment experts feel that Gen Y are investing in property earlier because high housing prices are preventing them from buying a home that they can afford to live in. Instead, Gen Y’ers are renting out their property and having someone else pay the mortgage. Then at a later date, they sell their investment, utilise capital gain, and then purchase their dream home.
Despite rising home prices, some 16 percent of Gen Y’ers now own two or more investments. In comparison, 17 percent of Baby Boomers and Gen X’ers are said to own two or more investment properties.
While the average age of a property investor is 34-years, younger generations are said to be entering the market at younger ages. The average age for Gen Y property investors is 25-years, Gen X is 35-years and Baby Boomers were typically aged in their 40’s when they began investing in property.
The number of first home buyers purchasing property to live in fell from 14.7 percent in the last quarter of 2014. However, the number of first home buyers that bought investment property rose by 2 percent to 10.1 percent in the first quarter of 2015.
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