In a nutshell
When you can’t afford to buy a property where you want to live, so you buy a property somewhere affordable as an investment and keep on renting somewhere awesome. Otherwise know as having your cake and eating it to.
In a bit more detail
Your parents have most likely told you a thousand times how they bought their first home somewhere cheap, aka the burbs (and not the fancy burbs). For my parents it was Ryde in Sydney. Problem is, that just isn’t all that appealing these days. Renvesting comes to the rescue by giving your new-age life choices some proper financial justification.
If you want to get into the housing market but can’t afford to buy somewhere you want to live, then snap up a pad in a more affordable suburb and rent it out as an investment property. Meanwhile, you keep renting in the part of town that suits your lifestyle. A concept that might knock the socks of a couple of great-australian-dream type people, but it’s proven to be a savvy financial decision.
Rentvesting gives you an option to get into the property world sooner and start building wealth without sacrificing ALL of your lifestyle. You’ll certainly be making sacrifices, your postcode just doesn’t have to be one of them. It gives you much greater flexibility for up or down-grading properties when you bounce through life stages, all the while helping you save and build equity to help you get to that dream home one day which IS in the suburb of your choice.
See all of our pieces about renting below, and if you’ve got a money term you’re confused about, hit us up and we’ll add it to the dictionary!