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Personal Residential Real Estate Investment in Australia: Investor Characteristics and Investment Parameters

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  • Rayna M Brown
  • Gregory Schwann
  • Callum Scott

Abstract

To date our understanding of the factors affecting the housing supply stem from the private provision of new units through real estate development. This article investigates a different aspect of housing supply, the private provision of rental housing through investment in existing properties. Using logistic regression and a series of micro data sets of Australian households, we examine the investment decision of residential rental property investors over the period 1990–2004. The sample period incorporates a full real estate cycle. Our results indicate that wealth‐related factors are the dominant factors driving these investments. Life‐cycle factors such as marriage and children play a less important role. Most of the determinants of income property investment do not vary with the property cycle. Marriage is an exception. It became more important as house prices rose.

Suggested Citation

  • Rayna M Brown & Gregory Schwann & Callum Scott, 2008. "Personal Residential Real Estate Investment in Australia: Investor Characteristics and Investment Parameters," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 36(1), pages 139-173, March.
    • Handle: RePEc:bla:reesec:v:36:y:2008:i:1:p:139-173
    DOI: 10.1111/j.1540-6229.2008.00210.x
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    References listed on IDEAS

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    1. Marion Kohler & Anthony Rossiter, 2005. "Property Owners in Australia: A Snapshot," RBA Research Discussion Papers rdp2005-03, Reserve Bank of Australia.
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    Cited by:

    1. Wei-Ling Tsou & Chen-Yi Sun, 2021. "Consumers’ Choice between Real Estate Investment and Consumption: A Case Study in Taiwan," Sustainability, MDPI, vol. 13(21), pages 1-13, October.
    2. Munirul H. Nabin & Sukanto Bhattacharya & Shuddhaswatta Rafiq, 2015. "Mortgage-Backed Securities (MBS): Is It a Curse or a Blessing for the Australian Home Loan Market? A Natural Experiment," Australian Economic Papers, Wiley Blackwell, vol. 54(2), pages 104-120, June.
    3. Chyi Lin Lee, 2017. "An examination of the risk-return relation in the Australian housing market," International Journal of Housing Markets and Analysis, Emerald Group Publishing Limited, vol. 10(3), pages 431-449, June.

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