Property market buyer demographics

Discussion in 'Investment Strategy' started by Finrod, 1st Nov, 2016.

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  1. Finrod

    Finrod Active Member

    Joined:
    18th Jun, 2015
    Posts:
    43
    Location:
    Sydney
    The market of property purchasers is composed of many different groups of people from First Home Buyers to Downsizers. The prevalence of each group in a particular suburb and their unique wants/needs would presumably be a factor in your purchasing decision.

    One of the property-guru's newsletters I received today suggested the following break down of the market, which I thought interesting:
    • 30% Investors
    • 10% First Home buyers
    • 40% Upgraders
    • 20% Downsizers
    • Outside the 100%: Smashed-avo loving renters, prison inmates, and people who live in camper vans. (this last bullet point of characters was not mentioned in the newsletter)
    Do these numbers sound right to you, or are they surprising? Have you based your investments targeting one or more of these demographics?

    Do you think that the aging population situation will see an increase in downsizers and investors (with the downsizers having extra cash to splurge on investments)? Do you envision any other demographic shifts?

    Are there any other slices of the population we could look at that would be of interest to investors, and build a strategy around? e.g. ethnicity, types of jobs (miners, public sector/defence force employees, students)

    Keen to hear your thoughts, and whether it is related to your investment strategy.
     
    Realist35 likes this.
  2. Propertunity

    Propertunity Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    3,476
    Location:
    NSW
    Generally the market is made up of 30% investors and 70% owner occupiers. However in NSW at present 56% of housing loans are taken out by investors - so they are over-represented by almost a factor of 2! This number is easily measured by loan data. I'm not so sure how data is captured on OOs that are upgrading or downsizing though :confused: I suspect perhaps interviewing a small number of REAs? Dunno, but I think the numbers unreliable.


    Either way, my personal strategy is Buy & Hold and to rent out - so I don't care who my tenants are - but they're not FHB or upgraders or downsizers - they are renters.
     
    Finrod and Realist35 like this.