Rentvesting gaining popularity among aspiring buyers in 2025
A recent Westpac survey has spotlighted that first home buyers are increasingly considering “rentvesting” in order to get onto the property ladder.
Westpac’s annual Home Ownership Report for 2025 revealed that rentvesting has risen in popularity as an avenue for first home ownership, with more than half (54 per cent) of first home buyers considering the practice, marking a 4 per cent increase from this time last year.
This research, commissioned by Westpac and undertaken by Lonergan Research, incorporated responses from 2,000 Australians aged 18-plus through surveys distributed across both capital city and non-capital city areas nationwide.
The rentvesting concept sees buyers purchase a property in a growth market or more affordable area, while continuing to rent in a more desirable market, in the hopes of building equity that can be eventually put towards buying a future home to live in.
Westpac observed that NSW was the top jurisdiction for rentvesting, with 61 per cent of respondents considering rentvesting in the state, followed by 54 per cent in Victoria, and 52 per cent in Queensland.
Westpac’s managing director of mortgages, Damien MacRae, said the report’s findings also highlighted that first home buyers are increasingly considering purchasing property in alternative markets.
“Our research shows that 82 per cent of Australians would be open to purchasing in an area they hadn’t originally considered, as buyers adjust their expectations in response to the market,” MacRae remarked.
Nevertheless, the director noted that rentvesting is simultaneously “growing in popularity as more buyers look to get their foot on the property ladder sooner, particularly in capital cities where housing prices are typically higher”.
This trend of aspiring home buyers looking to buy sooner was also evident in the 13 per cent of survey respondents who said they were looking to have purchased a new home to live in by the year’s end, representing an increase from the 10 per cent recorded in Westpac’s 2024 report.
“More Australians are entering 2025 planning to purchase a property than last year, reflecting renewed optimism from aspiring home buyers,” MacRae said.
“We’re continuing to see strong demand from customers seeking pre-approval for home purchases across both the owner-occupier and investor segments,” he added.
Looking ahead, Westpac’s senior economist, Matthew Hassan, predicted that potential rate moves will be a significant motivator for aspiring buyers in 2025.
“Interest rates are almost certainly having an influence here. Last year high rates deterred buyers, but the possibility rates will move lower appears to be shaping would-be buyer plans. For rentvestors the potential rate moves bode well for increased buying power,” Hassan said.
These insights into rentvesting are the latest signifier of the practice’s growing popularity, with agent responses to a recent CoreLogic survey framing increasing interest in rentvesting among first home buyers as a response to affordability hurdles.