Rent for life key to wealth
SAVVY Australians could have their property cake and eat it too.
For just $50 a week, keen Melbourne property investors could enter the market, according to rentvestor Tim Guest.
Mr Guest, who purchased 13 properties by the age of 27, still rents because he believes renting is the smartest, fastest and cheapest way to get onto the property ladder and build an investment portfolio worth millions.
"This isn't some high risk, get-rich-scheme - it's actually a very simple, sensible way to purchase a house and begin building wealth through property," he said.
"When you weigh up the pros and cons, rentvesting makes a lot of sense for a lot of people.
"It's smarter because you can buy in a lower cost, higher growth suburb while renting in a location that better suits your lifestyle.
"It's also cheaper because the rent you earn, combined with the investment tax benefits, gives you more disposable income, which can go into paying off your mortgage faster."
Mr Guest said Melburnians could spend about $32,000 a year in interest, council rates and maintenance on a $650,000 mortgage, which would amount to about $615 a week.
However, if it was an investment tax breaks available.
"All up, most people are realistically looking at being about $50 or less out of pocket a week," Mr Guest said.
He credits rentvesting to helping him build his personal fortune.
The 39-year-old grew up in a single-income family in the working-class suburb of Gosnells near Perth.
He bought his first property at 22 and was semi-retired with 13 properties by 27.
"(People) are gobsmacked when they hear I've always rented," Mr Guest said.
"I do this, because for me and for many, many other people, it's a much smarter move.
"Much of what we're taught about home ownership is fundamentally wrong.
"When you crunch the numbers (owning your own home) is not the best thing you can do.
"The property ladder is called a ladder for a reason and the most important thing is getting on to that first step in order to move towards your financial goals."
Mr Guest said he would likely rent for the rest of his life.