Property Investment for Millennials: Strategies Tailored to the Young Investor

Investing in real estate is a venture that young adults may either embrace early or avoid entirely, considering it an impossibility so early on in their life. 

It can be difficult to start that push towards property investing and to have that long-term foresight towards the future.

But the truth is that millennials make up the next generation of investors, with the potential to have a huge impact on the industry.

So, it’s important that people learn how to invest in real estate at a young age. Understanding the challenges and strategies of investing can take some time, but starting early can be the key to having lifelong success in the industry.

Let’s have a look at some of the reasons why investing early is a good idea, as well as some tips on how to start in real estate at a young age. 

Why investing at a young age can set up your future

Investing as a young adult has plenty of advantages, both short term and further down the line. 

1. In touch with technology

Understanding how technology works can really provide a leg up in the market.

Operating in the property industry relies on technology, and having quick and easy access to this world provides a more direct line to property investing.

It can also help you access a wider range of online resources and learning tools, such as podcasts, online courses, blogs and more.

This can fast-track your learning experience, developing your education at a faster rate than others.

2. Flexibility

One of the biggest advantages of investing while you’re young is the time and freedom you have to learn the ropes and build that portfolio. 

Investors in their 20s or 30s may not have as many commitments or responsibilities as those in their 40s or 50s. 

The more you move through life, the more commitments you’ll make, whether it be a family or job.

These responsibilities can make it difficult to dedicate time to learning the ins and outs of the industry, as well as taking the time to actually invest in property. 

While property investing is a great way to work towards passive income, it can take some time to get there. That’s why having the freedom of youth can be such an advantage!

This freedom allows young people to also take more risks and spend more time developing good investment habits.

It also allows young investors to test new and innovative investment methods, not necessarily having to stick with the traditional strategies. 

This flexibility can give young investors a serious edge over the competition. 

3. Time is on your side

Young people and millennials should remember that time is on their side when it comes to investing. 

Buying a home while still in your 20s and 30s means that the property has a longer opportunity to build equity.

A home purchased now or in the next few years has the potential to grow in value over time, with equity building through loan repayments. 

The longer you own the property, the longer you can experience this growth and benefit from it in the long-term future. 

4. Build a network and experience

The longer you spend investing and being around other investors, the more you’ll be exposed to the industry. 

You’ll develop key relationships with mentors, mortgage brokers, property managers, and other experts. 

These professionals will be able to assist in the investment journey, and can be especially helpful in providing investment ideas for young adults.

The longer you’re an investor, the more experience you’ll gain. Starting as a young adult also means you’ll have more time to learn from the mistakes you do make. 

Tips for young investors

While there are plenty of advantages when it comes to real estate investing for millennials, there are also plenty of challenges specific to investing as a young person.

Here are some quick tips to help you navigate those challenges!

1. Take it seriously!

With the luxuries of freedom and time, it can be easy for young investors to not take investing as seriously as it needs to be taken.

Investing in property should be treated like a business venture. Yes, there is time to make mistakes, but too many can really add up and become costly. 

That’s why it’s best to dedicate a good amount of time and energy into learning the ropes and building key relationships.

Remember, investing isn’t a hobby, but a means of setting yourself up for the future.

2. Managing limited finances

The biggest obstacle for young people investing in property most likely comes down to limited finances.

It’s true that this can be a major challenge which limits early investment opportunities.

That’s why it’s so important to manage the money you do make, save where you can and start early. Saving that first deposit will take time and a little bit of sacrifice.

But learning how to manage your limited finances can be the key to unlocking the short and long term benefits of property investing.

3. Managing Debt

As a young person, it’s likely you’re still paying off debts, either from bank loans or tertiary education.

But paying off debt for student loans shouldn’t really be an obstacle for investing. In fact, prioritising deposit saving and building equity through property can actually accelerate the ability to pay off that debt!

4. Building status

As a young investor there can be times where you may not be taken seriously by lenders, sellers and other professionals in the industry.

As mentioned, it’s a good idea to start building relationships to get around this.

Putting in the time to gain experience and develop those connections can really accelerate how you’re perceived by those in the industry. 

It’s a good idea to develop some key rapport-building and communication skills as a means of securing these connections. 

5. Overcome doubt through education

It’s natural to feel a little overwhelmed when it comes to investing.

There’s a lot to learn and plenty of experts with years of experience, which can result in some tough competition.

But the only way to overcome that self-doubt is through educating yourself and trying to absorb as much as possible. 

Learning to trust that knowledge is also important. It may sound corny, but believing in yourself is critical and can open up a world of possibilities. 

For more on property investing for millennials and young people, check out this interview with Glen James, who runs one of the biggest finance podcasts in Australia, My Millennial Money.