A personal finance content creator told me they avoid posting about property investing. It causes too much angst on socials.

I had a look. They’re right.

People are angry and they’re not shy about calling it out as if this creator is wholly to blame for the housing market. Their comments section overflows each time. Commenters vent their vitriol about everything from human rights to capitalism.

I’m not surprised given Australia’s current housing market.

You could sum it up in three words: lack of supply. It can be agonising if you don’t own property. Especially since COVID turbocharged purchase and rental prices.

There are better places to air your grievances than a content creator’s channel if you want change, but I can understand the frustration. I’m not blaming those commenters.

Even with all the angst, I reckon there will always be a need for a private rental market in a democracy. In my opinion - which will surprise no one who knows my background as an avid property investor - private property investing has its place.

We just do it in a way that doesn't solve the root cause of housing stress:

What we’re lacking is housing security.

Home ownership is one way to achieve security. It's the most desired way in Australia at the moment ...but it’s not the only option.

We could improve housing security with:

• More supply: government-backed supplies of subsidised and/or low-cost housing

• Controls limiting private rental price increases

• Longer term (e.g. 5 to 10 year) private leases

• Policy encouraging people to sell their private property investments.

But you might be stuck on my statement about private markets in a democracy.

Let's cover that first...

Why do we need a private market?

Short answer: so you can choose where you live. 

Government-administered systems don’t tend to offer right of refusal on location. There are exceptions, such as for medical conditions preventing someone using stairs, but they tend to be rare. You can’t just say ‘I don’t like it’ and get the next offer.

Take my dad’s recent housing challenge. He moved from a National Rental Affordability Scheme (NRAS, private) apartment to WA’s Department of Communities (public) housing.

The Dept of Housing offered him a lease at a specific address. If he’d turned it down, he’d have gone to the bottom of the queue to wait for another offer. He would have been sleeping in his car till then if I hadn’t intervened via ABC Radio (thank you Nadia and Damian) and my local politician (thank you Lisa O’Malley) to complain about the Department of Communities trying to make him homeless with a notice to vacate his NRAS apartment, which they’d just bought.

Keep in mind: average time to get a lease on the Dept of Housing waitlist is 148 weeks in WA at the moment.

Thank goodness he liked it and said yes.

There are many reasons you might want to turn down a location. Where you live is a key factor in your happiness.

Not least among reasons not live somewhere is the neighbours.

I lived next to a Dept of Housing apartment block for around 15 months. For six months, I called and emailed with complaints about noise, rubbish and abuse coming from one of the ten units on the top floor. The other nine tenants appeared to hide as much as possible.

The Dept finally sent out a rep after a metal chair landed on the roof of my shed less than two metres from my infant’s head. They discovered the people in the apartment weren’t even tenants – they were squatters. How the Dept missed this and took so long to resolve it is anyone’s guess. I take it as an indication of their level of care for the neighbours, including their own tenants.

Imagine if you were a tenant in one of the other nine units? You’d be stuck there, feeling unsafe in your own home. Not a recipe for thriving.

100 per cent government-owned housing is my idea of a nightmare. I want to be able to choose where I live.

Do you?

If you're communist or socialist leaning, you may fundamentally disagree with me on this. That's fine. You're welcome to any opinion you can justify. Just please channel Dr Brian Cox:

"The correct statement of individual rights is that everyone has the right to an opinion, but crucially, that opinion can be roundly ignored and even made fun of, particularly if it is demonstrably nonsense!"

And yes, Cox’s take applies to my opinions too 😆

Why do we need rentals at all?

I’m often asked some version of ‘But can’t we all just own our home?’

Around two thirds of us do at the moment.

In the 2021 census, housing was roughly one third each:

• Owners without a mortgage (i.e. owned outright) - 32 per cent

• Owners with a mortgage (i.e. part bank owned) - 35 per cent

• Renting their home - 31 per cent

(Did you note the total isn't 100 per cent? Two per cent are 'other tenure').

The census didn’t say how many of the renters own investment property, a strategy known as 'rentvesting'. Regardless, some of those renters don't dream of owning their home right now.

There are several reasons someone might prefer to rent than own, such as:

• Temporarily relocating, e.g. for work or study

• Trying out a neighbourhood/street before you commit to buying (highly recommended!)

• Don’t want the entire responsibility for maintaining the property

• Worried about exposure to insurance risks, such as flood or fire, in the area you’d like to live

• Like a change of scene regularly

• Economics - in a short time frame, it’s generally cheaper to rent than own a given property

One reason people choose not to buy in such circumstances is the transaction costs.

Up front you’ve got stamp duty and inspections (e.g. pest, building). On sale you’ve got agent’s fees. You’ll have conveyancing at both ends. It can be tens of thousands each time you buy or sell. Suboptimal if you only expect to live somewhere for 12 months.

Another is the risk of taking on a mortgage.

Even those ready to pick a spot to live might think twice. Trying to save for a deposit while renting then make the mortgage repayments is hard.

Other stressors can include:

• Changing interest rates

• Lenders mortgage insurance (LMI)

• All the other costs of ownership. Council rates, building insurance, maintenance, body corporate or owners corporation fees if there’s shared land/facilities… the list goes on.

These add up and can make ownership off-putting. For some, it’s just plain out of reach on their incomes.

You only have to look at our mortgage stress figures to see how many people are finding home ownership burdensome. For the record, over a quarter are 'At Risk' of mortgage stress at the time of writing. When you consider the quantifiable IQ drain of financial stress (equivalent to 13 IQ points) this does not bode well for our nation.

This all goes to a bigger discussion about housing affordability:

• Yes, it's woeful.

• Yes, it's getting worse.

• Yes, it is harder to own now than pre-2000.

…but even if we could wave a magic wand and fix house prices, renting would remain a legitimate, occasionally desirable, long-term housing strategy. Some people will prefer it at certain times in their lives. Some may happily do for their whole life.

We just do renting poorly in Australia, on average.

We’re not alone – this is a global problem.

Which brings me to...

What we could do better?

Goodness knows I’m not a housing and economics expert, but Blind Freddy can see the root cause of our problem:

A. We need more supply

Our population continues to grow and we still have one in eight adults and one in six children living on or below Australia’s poverty line.

Federal and state governments of all stripes have failed to build enough social housing.

They have also failed to incentivise enough private residential construction. There have been some good attempts such as NRAS, but they appear to have fallen by the wayside.

Most policy put forward in recent years seems perversely designed to drive prices up instead of increase supply, or shift the problem to someone else.

Take this promoted content on my feed this morning from WA’s Labour Government:

Great work, WA. Except short stay apartments are popular in Perth for companies bringing workers in from the Eastern states and overseas. In fact, they’re essential for some. There’s nowhere else to put incoming workers with rental availability at all-time lows. We rob Peter to pay Paul, and still aren’t building enough.

One policy I reckon could be positive on supply is the downsizer contribution into super. This would help empty nesters move to smaller homes, freeing up more family sized home options for sale. Not enough, but better than nothing.

There's no escaping the basics. Governments need to:

1. Build tens of thousands of homes a year for several years as affordable housing supplies.

2. Make it easy for sensible and sustainable private construction to ramp up. This increases private market supplies for those who can afford it.

3. Encourage and financially support sustainable innovative housing solutions to speed up 1 and 2.

It’s a big job, made all the more challenging for decades of neglect. We’re now doing the nine stitches we could have saved by doing one stitch three decades ago, more fool us.

In the meantime (and after) there are other levers we can pull...

B. Limiting rent increases

I am in favour of policies limiting the frequency and scale of rental increases. It's awesome to see some states doing it already. It helps tenants feel secure and allows them to better plan their finances.

Anyone investing in property needs to have a big enough buffer fund in place to ride out maintenance and mortgage interest rate shocks. Don't have one? Think twice about investing.

Would you need to pass on a mortgage rate increase or maintenance activity cost to your tenant immediately? Consider boosting your cash buffer, pronto.

C. Longer term leases

After the first year or two in a property, I reckon multi-year, even multi-decade, leases should be on offer.

Apparently such leases are popular in Europe. They provide much needed security for tenants. We should study how they do it and copy/adapt the approach, though goodness knows they have their own problems with housing.

I’ve got one tenant who’s been in the same spot for 11 years. I’ve offered them longer term leases, but they've chosen a periodic (month-by-month) lease for the last seven years. Their call, but: if longer term leases were more popular, would they have taken me up on it?

D. Policy encouraging people to sell their investment properties

Right or wrong, taxes and fees drive specific behaviours.

I am in favour of taxing wealth. I support increased taxed on super (just not the unrealised gains piece). But you can’t blame people for making the best decision for them when you set the rules. You get what you incentivise, and we currently incentivise keeping property.

For example, investment property is subject to capital gains tax (CGT). Even with the generous concessions brought in by the Howard Liberal government, it can be a disincentive to sell.

Take a hypothetical $1m property bought for $250k two decades ago by an individual (not in a trust or company).

For the sake of the calc, let’s assume $700k profit. Your tax bill - if you earned no other income that year - would be $123k.

It’s an effective tax rate of 12.3 per cent, so it’s still an excellent deal and I’d take it if I had other plans for the equity. But it takes some resolve to accept a $123k tax bill given the Aussie allergy to paying tax.

I assume this is why the Albanese Labor Government wants to open the door on taxing unrealised gains. It might force investors to sell, increasing availability for buyers.

Then there’s fees like stamp duty. If you didn’t have that sunk cost to absorb, people might be willing to buy or sell more swiftly instead of hanging on for decades.

When Chalmers says he’s up for tax reform, I hope he means fixing allllll of this.

What can you do while we wait for systemic solutions?

One property investor can’t solve the whole problem, but you can make a difference. Especially for your tenant.

I am not here to lecture you on morals or ethics. You do you, babe. And goodness knows I am in no position to criticise anyone after realising I had been investing in fossil fuels in 2025 (I still feel the embarrassment, dear reader).

But I still have some ideas on what a property investor can do, having been one for over two decades and having experimented with different approaches.

If you have other ideas, I would love to hear them - please leave a comment or send me a message!

My suggested first step: vote for parties/pollies with policies to improve housing security for all.

Then you can consider these...

A. Know you don’t have to increase the rent

…especially for longer term tenants.

Get tax advice on this first so the Australian Tax Office (ATO) doesn’t ping you. But so far, this hasn’t been a problem for me: 

Once any property is neutrally geared, I’ve slowed down the rental increases. Usually, I take whatever the agent recommends and halve it. Over time, the compounding takes effect. For example, the tenant I mentioned above rents for $340 a week. I could probably get $500 on the open market. It’s my way of thanking my excellent tenants who take terrific care of their homes.

I know it’s tempting to charge more just in case you need the extra money for maintenance. Or, if cost of living increases and you’re relying on the rental income for your living costs. But if you can do without it, consider cutting your tenants a break. 

Which leads me to…

 B. Give your tenant a way to contact you directly

This is frowned upon in general, especially by agents, and with good reason. Privacy, confusion, following legal processes correctly etc. It is not without risk.

I do it anyway.

Agents are human. They make mistakes. Not surprising when the average rental agent has 180 properties to look after. Now I think of it, that ratio might have gone up if rental companies are using AI.

Giving your tenant an avenue to contact you if something’s not going well with the agent is, I think, a kind thing to do. It can be a phone number or an email address. So far I haven’t had a tenant abuse it and it’s helped me sort out an agent who wasn’t doing as I instructed:

He’d sent out a lease renewal at the full market rate to another long-term tenant. We’d agreed something lower via email. If my tenant hadn’t texted to check the increase, I might never have known.

I called the agent to ask: ‘Did you send out a lease at $X rate?’

He asked how I found out, then lectured me for being in direct contact with the tenant. Didn’t sound like it was a mistake to me. I found a new agent soon after.

(One failure in 20yrs is pretty good).

I am also pro...

C. Fixing things that break

Swiftly and properly.

I know property investors who have had bad experiences, such as tenants damaging their property.

That’s what insurance is for.

Don’t make it an excuse to not to sort out genuine problems quickly.

If you want someone to treat their home with respect, make sure it’s well looked after. Replace broken items as quickly as is feasible. This is why I have rental agents (and love them). Their networks of trade professionals are outstanding. They’ll usually get quicker results than you can as an individual unless you have a similar network.  

What would you add to the list? Leave a comment or send me a message to let me and other readers know.

What the heck do I know about it?

You might be wondering:

How does someone who’s owned property since 19 feel qualified to have an opinion on what renters might want or need?

The audacity, right?

I’ve also been a renter for extended periods.

It’s not the same being a renter without owning any property. I’ve only ever rentvested, so I had always a toe-hold in the homeowner market when signing a lease. Still, it’s given me some insight into the other side of the equation. Plus I have appreciated the breather from owning property I lived in occasionally, especially when the eave of my last rental collapsed (8 sec video here).

At various times, renting meant I could:

• Test living in different suburbs, streets and neighbours. I could find the right place to stay long-term. I lived in 17 different homes since I was 21, mostly by choice. That would have been impossible without renting (13 of the 17 homes were rentals). The sunk costs of property buying disincentivise such frequent purchases.

• Pack things into storage and go overseas three times. Twice for travel, once for work. This kept my costs low for my Aussie belongings and meant I wasn’t taking up a property that someone else needed.

• Have enough cash flow to qualify for a mortgage on an investment property. Buying as a rental instead of home can be more favourable on cash flow. The rent counts in the cash flow assessment. Note: it usually comes with higher interest rates).

I may rent again in the future too, though I’m delighted to be back in our first ‘forever’ home again now.

About Money School

If you’re new here, welcome! Delighted to have you 😁

This is the blog for Money School, an Australian financial education company.

The main site is at https://www.moneyschool.net.au, but I keep our articles over here on beehiiv. I really like their platform.

Everything on the main site and this blog is for educational purposes only. I’m not a financial adviser, nor do I play one on Netflix. I aim to help you learn about money so you can choose your own adventure.

Money School was co-founded in 2010 by me (Lacey Filipich) and my mother, Fran White. Money School offers workshops, online courses and I have an international award-winning book, commissioned by Penguin Random House and published in 2020.

I’m also a regular media commentator on all things personal finance. If you’ve got 16 minutes to spare, you might like to check out my TEDx talk (over 1m views!) on financial independence and mini-retirements.