Working from home presents a new opportunity for first home buyers desperate to get into the property market. While inner-city prices spiral further out of reach, those who can work from home are turning to regional locations for more affordable housing or rentvesting as viable options. But with surging demand driving the fastest rise in house values in these areas, first home buyers who may be waiting to buy are urged to start considering their options now when it comes to settling in the regions or rentvesting.
Moving to the regions
As more first home buyers aspire to be home owners, and rising property values make it increasingly harder to buy in the capital cities, fringe locations and regional areas are fast becoming the logical next choice. Digital property platform, REA Group, reports a spike in regional enquiries from first home buyers, with nine out of the top 10 areas researched falling in outer suburbs.
Between May and August 2021, the number of first home buyers settling in outer suburbs grew by a whopping 77 per cent when compared to the same period in 2020, according to data from NAB, while a separate report from CoreLogic backs this up, showing regional house values are up by 25.9 per cent during 2021, a result of the growing demand for these areas.
Rent while you own
The rise in house values has also prompted an increase in first home buyers considering rentvesting as an option to get into the property market. Rentvesting means buying an investment property in a more affordable area – perhaps an outer-city suburb or regional location – while living and renting in a desired location within commutable distance of the city or work.
Rentvesting is a particularly helpful strategy for those who live – or who need to live – in the city but are unable to afford city living property prices. Largely driven by affordability, these savvy first home buyers recognize the benefits of owning an investment property as a strategy for moving up the property ladder.
Rentvesting could give first home buyers the kickstart they need to eventually buy their own home in their desired location, by leveraging the financial gains from their investment property. And with house price increases fast outstripping wage growth, it makes sense for many to buy now rather than spending several more years waiting to save a larger deposit.
More options for first home buyers
For first home buyers, there’s never been a better time to take advantage of historically low interest rates to get a foot onto the property ladder: either by buying a property in a regional location and working from home, or rentvesting.
If you’d like to discuss either of these two options for first home buyers, or you’d like financial advice about investing in property, refinancing an existing property, or financial advice designed around your specific circumstances, please get in touch with the team at Mortgage Express.
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