The Pros Of Becoming A Rent-Vestor

by Sue Irons | Feb 14, 2022 | General, Property Investment Education

There are not many people out there who aren’t itching to buy their own home. It’s part of the Kiwi dream, right?! Who doesn’t want a slice of their own piece of paradise. But with slow wage growth and exceedingly high house prices, it’s getting harder and harder to become a traditional homeowner – which is why some people are opting to become rent-vestors instead. 

WHAT IS A RENT-VESTOR? 

A rent-vestor is a property investor who generally chooses to buy outside the city or suburb where they live. It simply gives them the option to buy in a location that performs well but may not be where they personally want to live because of work, social commitments or other lifestyle requirements. 

If you’re struggling to purchase your first home, here are three reasons why you may want to consider rent-vesting. 

1: YOU WON’T RISK BEING PRICED OUT OF THE MARKET 

More and more people are being priced out of the property market due to not being able to purchase the type of home and location they want to live in. For example, waiting until you have the financial means to buy in the inner-city suburbs may see you miss the boat completely. But on the flip side, rent-vesting allows you to rent in an area that you could not afford to buy in, while having an income producing asset in an area that serves the needs of your tenant. It’s a win, win! 

2: YOU’RE CREATING A PATHWAY OF WEALTH 

With a booming property market, acquiring a property now means future growth for tomorrow. Having a rental property grow in value means you’ll be able to use that equity to later purchase your own owner-occupied place or use it to buy more investment properties down the track. Either way, those options will be off the table if you choose to do nothing. 

3: YOU CAN BECOME A SUPER SAVER 

Not only are you able to generate additional income by being an investor through the returns from rent, but you’re also able to save A LOT of money by not personally living in the property. For example, if your mortgage and expenses are all covered by rent (we call this being positively geared), then you can opt for a shared living situation (either with family or flatting with friends) where you’re only paying for a room, not an entire house. 

HOW TO BECOME A RENT-VESTOR

While this type of strategy can be a highly effective way to get you on the property ladder and closer to achieving your financial goals, there are still many moving parts that must be managed correctly. For instance, getting the right type of finance and structuring your loans accordingly will be an important component. On top of this, you’ll need to do rigorous due-diligence on where to buy, as well as getting the right property manager in place to ensure your asset is being looked after. 

The best place to start is by assessing your overall goals. Where do you want to be in five or 10 years from now? Your first property will often determine your ability to acquire more real estate in the future, so having a clear pathway around how you’ll grow your portfolio is key even before you buy your first investment. 

Discover how you can create long lasting wealth through real estate today. Join our free property investing masterclass.

Book your spot now and find out what you need to know about the current market landscape and how you can use it to future proof your finances. 

Limited spaces available. 

Why Your 1st Property Purchase Is the Most Important!

by Sue Irons | Jan 20, 2022 | General, Property Investment Education

How important is it to buy right the first time? Well, I’d go as far as saying that your very first property could easily be your very last if you don’t play your cards right from the get-go.

This is because one of the key ways to build a thriving real estate portfolio is by banking on the growth of a property to support the next one (and so on and so forth) through the process of recycled equity.

DON’T GET STUCK IN THE ONE AND DONE TRAP

One wrong asset and you’re stuck!

Now you might say, ‘Oops, oh well I’ll just sell and start again…’

But it’s far from being that simple. Property is not a liquid asset and comes with a range of different variables that will impact your chances of having a positive outcome.

Factors will include what you buy, where you buy and the overall market conditions at the time. Just because you recognise that you made a wrong move, doesn’t mean the current real estate landscape will be forgiving – you may have to buckle up and hold on for years to get the same amount of money out that you put in – let alone make a profit or even think about purchasing additional property.

As you can see, getting it wrong can be detrimental, not just now, but for years to come.

So how can you ensure you’re buying right from the get-go?

AVOID WELL-MEANING ADVICE

Firstly, it’s not listening to your uncle Tom at the family BBQ about the do’s and don’ts of real estate wheeling and dealing (unless of course he’s an expert). All too often, the extent of our research doesn’t go beyond the opinion of our family and friends, who most of the time, are not property tycoons revelling in success.

The key is to get advice from professionals who have real experience and can demonstrate sound results.

But even before you speak to someone, you want to start thinking differently to all the other first-time home buyers.

House hunting can be emotionally exhausting and overwhelming, which can cause people to make rash decisions.
THINK LIKE AN INVESTOR
Yes, buying your first house can be one of the most exciting things you’ll ever do but the key to your long-term success is actually thinking three houses ahead.
Now, if you buy number one wrong, you may not have a chance to get to house number three, which is why we always want to be thinking ahead and looking at the bigger picture.

This comes down to having an investor mindset. Yes, buying your first home may look strategically different to how you’ll purchase your second or third, but there’s no point getting on the ladder if you don’t know how to get up it.

Good investors know the buying factors that will determine long-term victory, where capital growth will flow, how their financing needs to be stacked up and what their next move will be once their first property is secured.

HOW TO BUY RIGHT THE FIRST TIME

The reality is, if you don’t think ahead, you simply won’t get there.

Buying your first home has the ability to set you up for financial freedom in the future. Learn the ins and outs on how to buy right the first time AND how to develop a budding property portfolio in the process at our free property investing seminar.

Plus, you will also get the chance to have one of our property experts assess your exact situation and even establish a property growth plan that’s right for you if that’s what you choose.
There are limited spots available.

REGISTER NOW FOR THE FREE PROPERTY INVESTOR WEBINAR

Sue Irons
CEO – Positive Real Estate NZ