Motivations of investors in the private rental market

Summary

The perceptions of property as a low-risk investment, guaranteed to yield long-term capital gains, are key motivators for small-scale private rental investors. However, not all motivating factors are financial. Personal goals and personal or family circumstances also play a key part in investment decisions.

Project Number: 20280
Research Theme: Private_Rental
Project Leader: Seelig, Tim
Funding Year: 2005
Research Centre: Queensland

Research & Policy Bulletin

Issue 115: What motivates households to invest in the private rental market?

Download the PDF
459 KB PDF Document

Description

This research involved 100 interviews with investors and real estate industry professionals that were conducted in Queensland, New South Wales and Victoria in 2006-07.

The key findings of the research are:

Financial motivations for investing in rental property are important but not overriding considerations of 'mum and dad' investors.
The primary financial concern is the capital gain rather than rental income, hence, negative gearing is, subjectively, of less importance.
Property investment is regarded as a safe, stable, familiar, long-term investment.
The range of other factors driving investment decisions include, proximity to their home, whether their children might one day live there, whether they might retire there, how well they know the area.

More Information

Positioning Paper: No. 087: Motivations of private investors in the rental market
1.6 MB PDF Document

Final Report: No. 130: Understanding what motivates households to become and remain investors in the private rental market
561 KB PDF Document

Research and Policy Bulletin: Issue 115: What motivates households to invest in the private rental market?
459 KB PDF Document

Printer friendly version Email to a friend Send feedback