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Rentvesting: buy the investment first and keep renting. Does it work?
Bayley Clarke · Mortgage broker on the road · Last checked 3 September 2026 · 3 min read
The short answer
Lovely buzzword, and it works for a lot of people. You rent where you want to live and you buy where you can afford, so you get the asset and the growth without giving up the lifestyle.
The trade is your first home buyer benefits. Buy an investment first and the 5% scheme and the stamp duty concessions are gone. For most rentvestors that's fine, because the plan is a property with real growth and rent strong enough to support it, and then the next one. The numbers decide it.
The 90 second version. The rest of this page is the detail underneath it.
What rentvesting actually is
You rent where you want to live and you buy where you can afford. It gives you the exposure and the ability to invest in property in markets that maybe aren't as expensive as where you're currently living, and it means you have exposure to property from an asset and growth perspective while you're still enjoying the place you live in.
For someone renting near the coast or in a capital city where the numbers don't work, buying a $450k place in a regional market with a solid rental return can be the first step onto the ladder without moving away from work, mates or the beach.
The trade: first home buyer benefits
Whether or not it makes sense for you is a matter of running the numbers, and understanding that if you buy an investment first and continue renting, you do forgo your first home buyer benefits. The 5% deposit scheme and the stamp duty concessions are for a home you live in.
Which for a lot of people is fine, because typically when you're rentvesting, your goal is to buy an investment property and continue buying and building your portfolio while you keep renting where you live. So the fact you're paying stamp duty doesn't concern you too much. The full trade-off is on investment first and first home buyer benefits.
What the numbers have to show
You're making sure you're buying a property that has good growth potential, strong rental income returns, and can actually continue to support the lifestyle you're living where you are. That last part is the one people skip. The bank assesses your rent as an expense and the investment loan as a debt, then shades the rental income before counting it. If the combined picture doesn't service comfortably, the strategy doesn't work no matter how good the suburb looks.
Deposit-wise, you're buying without the scheme, so it's 20% to avoid LMI or a smaller deposit with LMI on top, and investment loans often carry a slightly different rate and loan-to-value ceiling than owner-occupied ones. Run it as a monthly number: rent you pay, plus the shortfall on the investment after rent received, against what you're paying now.
The honest bit: it's a strategy, not a shortcut
Rentvesting works when the investment property is chosen on growth and yield and the sums are done cold. It goes wrong when it's used to justify buying something, anything, because owning feels better than renting. Paying stamp duty and LMI to hold a flat property while you also pay rent is the worst of both.
If the plan is one investment and then a home to live in, check whether buying the home first on the scheme and investing second gets you further. Sometimes it does.
Thinking about buying an investment while you keep renting?
A 30 minute call. Your rent, your income, the property you're looking at and its likely rent, and I show you the monthly number with and without the first home buyer benefits, so you're choosing on maths.
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Next question
Can I buy a block of land now and worry about the build later?Another way people get onto the ladder without moving.
Related answers
What does it actually cost me to sell a property? Do I need to save a full 20% deposit again for my next home? If I buy an investment property first, do I lose my first home buyer benefits?Not your question? Book a call and ask it, or call 0437 189 939.