What sort of animal are you? Five types of property investor

Graeme Salt

I arrange lots of loans for clients’ investment properties. Property investors are not all alike; broadly-speaking, here are the different animals I see on my travels:

The Negative Gearer

We used to see lots of these beasts. But, in the past few years, they have dropped off.


The negative gearer was in its prime when it was sure it could buy a property and then sell it for a profit a few years later. The negative gearer thrived went rents did not cover mortgage payments because they believed would make up for it with a juicy capital gain when they sold the property.


But, in the past few years things have changed:

  • The property market is not-so-robust that investors are confident of making a profit on sale
  • The GFC has made investors cautious about riskier investments


The Positive Gearer

The positive gearer is the opposite of its negative cousin. Nowadays we see lots of them. Many of my clients are achieving 7% or even 10% returns.


This animal likes to buy an investment and minimise stress, they like to sit back confident that the property makes a profit from day one. There is, however, one area where the positive investor will take ‘risk’ - often they are prepared to invest in places they do not know (often in WA, QLD and NT). But much of this risk has been mitigated by them doing much research.


Home bird

There are two types of home bird:

  • Home bird conservatrice and
  • Home bird fixitus

Home bird conservatrice likes to invest in its home town so that it can keep an eye on the property and feel reassured. They take a very low-risk strategy by sticking to something they know.

Home bird fixitus takes a more aggressive investment stance. She will decide to manage and maintain the nearby investment property herself. By doing this she takes out the management fees and hence makes a more generous profit than her cousin. She does, however, have to deal with tenants!


The Collector

The collector wants to build a portfolio of investment properties. Generally it is driven by two factors:

  • A plan to have, say, ten properties in ten years’ time
  • A reluctance to buy and sell properties because it is a costly exercise


Frequently, the collector will have done its research and often be in investment clubs and subscribe to investor newsletters.


The Migrator

The migrator has really flown the nest as it likes to invest in overseas property. There are two types of migrator

  • Some buy properties in, say, Bali with an eye on the tourist market
  • Others buy in places such as the US following attendance at property expos or seminars.


Over the years I have been arranging finance for clients, I have concluded that there really is no right or wrong – it is simply a question of working who you are and what your goals are.

For a free consultation on how to finance your investment property, please contact me on 0457 755084 or graemes@originfinance.com.au