The PropTrack Terri Scheer Investor Report published on Thursday attributed the surge in investor activity to tight rental conditions and expectations of further rate cuts.
This marks a decisive rebound after the slowdown that followed the Reserve Bank of Australia's cash rate hikes in 2022 and 2023.
Since the RBA's easing cycle commenced in February, Australia's benchmark interest rate has reduced by a cumulative 75 basis points to 3.60% as of September.
More Aussies investing in properties
The report revealed investing in housing "has become more common in the past four decades", with more than 14% of Australian taxpayers reporting rental income in 2022-23, up from just over 4% in the late 1970s.
"This share has been largely stable since the turn of the 2010s, though it has declined from the peak seen in the 2013-14 financial year," the report said.
"This is high by global standards," it continued. "In other countries, corporate and government ownership of housing is more common."
These investors are typically high-income earners, earning above $225,000, and aged between 35 and 64.
The share of property investors aged over 60 years has risen from 14% in the early 2000s to 27% today.
Among Australians who do invest in property, two-thirds own just one investment property, and one-fifth hold two. Only a small minority expand to three or more.
Falling mortgage rates and tight rental market conditions are seen as the drivers of the resurgence.
"The number of new investor loans has risen solidly in the past two years," said REA Group senior economist Angus Moore.
"Rental market conditions remain very tight, and rents have grown rapidly in recent years. That's likely encouraging investors to buy in.
"With markets expecting at least one further rate cut by the Reserve Bank, strong investor activity is likely to continue over the rest of this year and next."
However, prior to the release of this report, three of the big four banks in Australia have pushed their rate cut forecasts from the upcoming RBA meeting in November to February or May 2026.
Rents soar, yields strengthen
The investor resurgence is being fuelled by two reinforcing forces: soaring rents and limited supply.
National vacancy rates have dropped to near record lows, with the latest figures at 1.2% in September, per SQM Research.
Meanwhile, advertised rents have surged nationwide, 4.8% year-on-year, taking the national average to $655 per week.
Gross rental yields have also improved, lifting the income appeal of residential investments.
More than 90% of investment properties sold in the past year achieved prices above their original purchase price, one of the highest proportions on record.
Terri Scheer executive manager Carolyn Parrella said the conditions were generating real momentum.
"With more than 90% of investment properties selling for more than their purchase price, the current market conditions could present a lucrative opportunity for property investors," she said.
Hotspots: Cities and beyond
Inner-city Sydney and Melbourne remain favourites, but surrounding suburban belts and more affordable regional markets are also attracting strong attention.
The combination of rising yields and price growth across multiple geographies suggests investors are looking for both security and diversification.
Image by Daniel Brubaker on Unsplash
