Loan Market Sunshine Coast home finance broker Dominic Polifrone said a growing proportion of first home buyers were Gen-Y’s who were looking for investment properties. Mr Polifrone said over the past two months the company had experienced a 40 per cent rise in enquiries for property investors in the Gen-Y category compared to the same period last year.
“The days of property investors being primarily Mums and Dads are over – many younger people, including recent graduates, are seeing the upside of getting into the property market early in their careers,” he said.
“Under the right circumstances, young buyers have the capacity to purchase a property and have it work well for them as an investment.”
Mr Polifrone said the key for many young property investors was the fact rental yields are at favourable levels in all capital cities, meaning young investors can rent elsewhere while their mortgages are being serviced.
“It’s very important that any investor, young or old, receives the right advice and be completely aware of the implication of investing in property,” he said.
“The feedback from our broker network has been unanimous in that Gen-Y investors have already done a considerable amount of research before meeting with a mortgage broker.
“The savings initiatives of Gen-Y have been well documented through the past two years and many of these savers now have large deposits which they’re putting towards property investment purchases.
“There’s a variety of research and market tools available for many investors to determine the right time to enter the market. It seems Gen-Y think that time is now.”
Mr Polifrone said a deposit was one of the most important aspects of a property investment because it not only demonstrates to the bank you can save but it will also reduce additional Lenders Mortgage Insurance costs.
He said Loan Market’s uplift in enquiries were echoed in recent data from Genworth Financial, which showed property investments by recent graduates were around 12 per cent, a figure more than double the average of 5 per cent nationally.