{"id":150703,"date":"2021-02-24T16:30:34","date_gmt":"2021-02-24T05:30:34","guid":{"rendered":"https:\/\/propertyupdate.com.au\/?p=150703"},"modified":"2021-02-19T11:57:55","modified_gmt":"2021-02-19T00:57:55","slug":"how-the-government-delivered-an-accidental-investor-boom","status":"publish","type":"post","link":"https:\/\/propertyupdate.com.au\/how-the-government-delivered-an-accidental-investor-boom\/","title":{"rendered":"How the government delivered an \u2018accidental investor\u2019 boom"},"content":{"rendered":"

Cause and effect is a well known law of relationships.<\/strong><\/p>\n

\"canberra-politics-ACT-australia-government-leader\"In 2020, there was an almighty cause, which brought an incredible response across political and social landscapes.<\/p>\n

But another lesser-known law is, \u201cIf you\u2019re going to throw a party you\u2019ve got to expect a little damage.\u201d<\/p>\n

In other words, things implemented to bring about one set of results invariable encourage others.<\/p>\n

So it goes with moves by governments at all levels to help boost the economy and the building industry in the wake of COVID-19.<\/p>\n

You see, a few moves by our politicians are also driving a buyer group I first spotted a few years back \u2013 and as a result, their numbers will be on the rise in 2021.<\/p>\n

Accidental investors<\/span><\/h2>\n

About four years ago I was analysing data about our investor clients and their assets.<\/p>\n

It included elements such as how far they lived from their investment and how long they\u2019d owned their property before commissioning our services.<\/p>\n

Among the very interesting statistics revealed was one standout \u2013 and I\u2019ve been watching its progression ever since.<\/p>\n

<\/div>It\u2019s the rise of the \u2018accidental investor\u2019.<\/p>\n

In short, I identified the percentage of people who had first lived in their assets before moving house.<\/p>\n

They\u2019d retained that original home as part of an investment portfolio rather than sell it.<\/p>\n

In most cases, these owners bought their first home for the usual reasons.<\/p>\n

Maybe it was close to family, or great schools, or a workplace.<\/p>\n

But for whatever reason, when the time came to shift, they were able to keep the property and find tenants, thus becoming investors without the initial intention of buying real estate as an asset.<\/p>\n

In 2018, I found that around 23 per cent of investors had once lived in their investment property, with owners living in their former home for four years and 11 months on average before moving out and flipping it into their portfolio.<\/p>\n

Then at the beginning of last year I published our\u00a01000 Assets (2020)<\/em>\u00a0report which was a four-year study of investor behaviour.<\/p>\n

The information revealed for data analysed between April and December 2019, the percentage of accidental investor had risen slightly to 25.7 per cent of landlords, with the average occupancy falling to four years, two-and-a-half months.<\/p>\n

In short, accidental investor numbers were rising, and their initial occupancy period was falling.<\/p>\n

The new trend in 2021<\/span><\/h2>\n

While there\u2019s been a definite trend toward accidental investment throughout the past five years, I believe the numbers in 2021 will show an exponential rise.<\/p>\n

And, this time, it will be no accident.<\/p>\n

In a recent news article, property investment advisor Richard Crabb, said a new cohort was on the increase.<\/p>\n

\"First<\/p>\n

He said the \u2018livevestor\u2019 had spawned.<\/p>\n

Livevestors are a cohort who are buying their home (usually their first) with the express intention of it becoming an investment in the future.<\/p>\n

As such, they purposefully move their property selection criteria away from the usual homebuyer checklist and, instead, look for long-term investment potential in their first house.<\/p>\n

In short, they\u2019re not-so-accidental investors.<\/p>\n

Here\u2019s why we\u2019ll see the numbers skyrocket in the near future.<\/p>\n

The introduction of the HomeBuilder stimulus by Federal Government has been a huge success.<\/p>\n

The building and development industries are singing their praises as employment and activity in the new-build property sector goes \u2018boom!\u2019.<\/p>\n

In addition, there is a range of state and territory incentives, from first homeowner grants to stamp duty discounts, that have taken home buying assistance to record levels.<\/p>\n

On top of this, low-interest rates designed to keep our economy improving in the post-pandemic world are boosting the buying power of purchasers, as loan serviceability \\ becomes ever easier.<\/p>\n

\"HousesThis confluence of factors is about to spawn a new wave of accidental (on purpose) investors.<\/p>\n

They will drive markets in city fringe high-rental-demand suburbs with excellent long-term value growth prospects.<\/p>\n

These buyers will choose to stay in their home for at least 12 twelve months (the minimum usually required in order to qualify for various grants).<\/p>\n

But many will decide to move out soon after the year is up and make plans to upgrade their abode while retaining their first purchase.<\/p>\n

When we next visit our study, my bold prediction is that the \u2018Accidental Investor\u2019 number will be over 27 per cent, and in-residence time will be between two and three years \u2013 and it\u2019ll just be the beginning.<\/p>\n

Accidental Investors are on their way and set to become a cohort of influences that will be hard to ignore in Australian property markets.<\/p>\n

<\/div>\r\n
<\/div>\n","protected":false},"excerpt":{"rendered":"

Cause and effect is a well known law of relationships. In 2020, there was an almighty cause, which brought an incredible response across political and social landscapes. But another lesser-known law is, \u201cIf you\u2019re going to throw a party you\u2019ve got to expect a little damage.\u201d In other words, things implemented to bring about one…<\/p>\n","protected":false},"author":122,"featured_media":150704,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[54,3],"tags":[],"class_list":["post-150703","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-latest-property-updates","category-property-investment"],"acf":[],"yoast_head":"\nHow the government delivered an \u2018accidental investor\u2019 boom<\/title>\n<meta name=\"description\" content=\"Cause and effect is a well known law of relationships. 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