Real estate moves helping millennials beat out Boomers in the housing game
Millennials are shaking up the Victorian property landscape, outpacing Boomers with surprising investment moves. Find out the strategies turning the property market in their favour.
millennials are proving the great Australian dream isn’t dead, it’s just evolved – as they outpace Boomers in property investing.
By embracing innovative approaches like rent-vesting, co-investing, and targeting regional hotspots, millennials are not only getting into the market, but starting to thrive in it.
Data from the Australia Bureau of Statistics shows new loan commitments for investors reached a staggering $11.6bn nationally in September 2024, a massive 29.5 per cent jump from the year before.
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In Victoria, investor activity rose slightly to 3,905 new loans.
Millennial investors like 33-year-old Sydney-based investor Kej Kulane said the data was more than just statistics and was indicative of his generation turning the housing crunch into an opportunity.
“I have a portfolio of seven properties – I recently purchased a property in Bendigo,” Mr Kulane said.
“It was a fixer-upper I bought for $450,000 – I budgeted $40,000 for renovations and the total cost came to $520,000.
“The property is now worth around $650,000 – that’s a $130,000 equity gain in just eight weeks.”
Mr Kulane said cash flow was the name of the game for investors and keeps the rental yield of the property in mind to make sure the home is sustaining itself financially.
“I aim for rental yields of 5–6 per cent so I’m not breaking the bank to hold onto a property,” he said.
“Bendigo is perfect for that. It’s affordable, tightly held, and offers great returns.”
Belle property Bendigo principal Tim Noonan said his area has become a key hotspot for millennial buyers and investors priced out of Greater Melbourne.
“Strong rental yields and lower entry points are what makes Bendigo offer fantastic value for money and a balanced lifestyle,” Mr Noonan said.
“It’s close enough to Melbourne for convenience but without the sky-high costs.
“For millennials, Bendigo represents an affordable, accessible market that combines great value with strong rental returns.”
Mr Noonan said the accumulation of the anticipated rate cuts and number of listings made the best value for buyers.
millennials are also challenging the real estate norms in other ways, including rentvesting – renting where they want to live and investing where they can afford.
33-year-old Pascal Butler and his partner Georgia, who rent in Box Hill, shifted their mindset after realising homeownership in their dream suburb was out of reach while raising their daughter Mimi.
“Buying a home felt impossible while renting in Toorak,” Mr Butler said.
“But with my dad’s help and guidance from property investment group OpenCorp, we secured our first property in Perth — and it’s already grown by $250,000 in value.”
Mr Butler said instead of chasing the white-picket-fence dream he has remained focused on building wealth through investments.
“Our first property doesn’t cost us anything out of pocket, and it’s growing in value, which puts us in a better position to buy the home we really want down the track,” he said.
And with another baby on the way Mr Butler said he is getting ready to purchase another property to continue building his portfolio.
Belle Property/Hocking Stuart state director Anthony Webb said rentvesting is a game changer for millennial buyers.
“We’re noticing a shift in the types of properties investors are targeting,” Mr Webb said.
“Many are avoiding high-rise apartments in the Melbourne CBD and instead focusing on units and townhouses in good locations.
“These types of properties are more affordable and still offer solid returns.”
Mr Webb said for investors targeting Victoria’s regional areas was all about affordability and strong fundamentals.
“One of our agents in Bendigo has mentioned strong investor activity, particularly in the back half of last year,” he said.
“Investors are drawn to the area because property prices are lower, and the rental yields remain attractive.”
Despite their success, the Belle Property/Hocking Stuart director said millennials face challenges Boomers never had to contend with, including rising land taxes and increased taxes across the state.
“Investors are shifting toward townhouses and units with land, which tend to perform better in terms of growth,” Mr Webb said.
“High-rise CBD apartments, on the other hand, have struggled due to oversupply.”
Tax Depreciation Australia director Theo Mavratzkais said many millennials investors are missing out on significant financial benefits because they aren’t aware of what they can claim back for their rentals.
“For a brand-new three-bedroom house, we might be able to claim $10,000 –$15,000 in deductions in the first year alone,” Mr Mavratzkais said.
“Depreciation reports are an essential tool for property investors to maximise returns,” he said.
Meanwhile, co-investing is gaining popularity as millennials look to share the financial load with mates or partner.
OpenCorp chief executive Cam McLellan said the approach can get buyers into the market faster.
“By splitting the deposit and costs, millennials can get into the market sooner without sacrificing their lifestyle,” Mr McLellan said.
“It’s a win-win if you have a clear agreement about responsibilities and profit-sharing.”
The OpenCorp chief executive said millennials’ willingness to take bold steps will pay off in the long run – with lower interest rates predicted for 2025, their borrowing power is expected to increase, giving them an even bigger advantage in the market.
“The longer you wait, the harder it gets,” Mr McLellan said.
“But with the right plan, millennials are proving you can thrive — even in today’s market.”
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Originally published as Real estate moves helping millennials beat out Boomers in the housing game
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