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It is the Australian dream to own residential property, whether it is just for owner-occupier purposes or for investment purposes.

So, how exactly can one break into the property market?

Of course with the continual growth of property prices in well-selected markets around the country, some may find it harder to break into the property market, however, I am here to tell you that it is not impossible, it can be done by anyone given the goals and discipline are in place.

Some of the common strategies to crack into the property market include:

  1. First home buyer incentives

  2. Parental guarantee

  3. Rentvesting

Let's break each of these down:

Strategy 1: First Home Buyer Incentives.

Homebuyers who are looking to live in the property they purchase are known as owner-occupiers. In response to the global pandemic, the Federal Government have created incentive packages to further stimulate the economy, which has lead to the perfect storm for first home buyers looking to live in the properties they purchase.

It has never been easier for first home buyers to get into the market if one qualifies for the current government incentives.

Being able to use a 5% deposit with no LMI, massive stamp duty concessions, and certain first homeowners and new building incentives has enabled those who qualify a wonderful opportunity to get into the market with ease.

With this strategy, first home buyers may use this initial property as a stepping stone to get into the suburb where they want to live down the line.

Strategy 2: Parental Guarantee.

Another strategy to get into the property market faster, if you have managed to save a small deposit is to have a close family member (parent, sibling, or partner) become a guarantor to the property, hence avoiding the expense of lenders mortgage insurance (LMI).

Lenders Mortgage Insurance (LMI) is a fee banks and other finance lenders charge borrowers when they are deemed high risk. Usually, this is when their deposit is less than 20% of their property’s purchase price.

Strategy 3: Rentvesting

The rentvesting strategy allows for a more affordable entry into the property market.

The term rentvesting is when you rent where you live and own an investment property that you rent out to someone else.

Rentvesting allows investors to live exactly where they want, enjoy the lifestyle benefits of that area without the price tag. The owned investment property is a generally more affordable market, however, selected well to ensure capital growth over the long term to develop equity.

Key Takeaways

Getting into the property market requires sacrifice and discipline in order to save a deposit and the ability to get a loan. As always getting your foot into the market is key.

The importance however is not to get into a property for the sake of it, particularly if it is an investment property. It must work, in terms of serviceability and growth or that will be the only property one ever gets to buy.

To stay up-to-date make sure you join our Property Market Pulse Newsletter here.

Warren Jacobs - Senior Property Investment Consultant at Meridian Australia

P: (02) 9939 3249

Disclaimer: When considering purchasing a property, it's always prudent to seek the advice of an appropriately qualified professional to determine which strategy is most appropriate for your individual circumstance.


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