The Fractional Investment in Residential Property in Australia report, published in partnership with online property platform BRICKX, found that Australians aged between 18 and 34 are most likely to engage in fractional property investment through an online platform, representing 44 per cent of total respondents, with Australians aged 25 to 34 making up 37 per cent of the surveyed investors.
The research also found that interest in such investment declined with age. Respondents aged 35 to 44 made up 22 per cent of respondents, followed by Australians aged 45 to 54 (19 per cent) and respondents aged 55 to 74 (15 per cent). There were no investors aged over 75.
BRICKX CEO Anthony Millet claimed that fractional property investment provides Millennials with an opportunity to break into the increasingly unaffordable Australian housing market.
“Property investment has long been synonymous with the Australian Dream but can often be thought of as unachievable for everyday Australians — particularly Millennials,” the CEO said.
“Fractional property investment breaks down the traditional barriers of property investment and helps people to get a leg up on achieving their own personal Australian Dream.
“The uptake of fractional property investment from Millennials is driven by the affordability challenges they face around property prices. It showcases their resourcefulness and adaptability to a changing market.”
When analysed on an income basis, the report noted that two-thirds of investors (64 per cent) earn a salary between $50,000 and $150,000.
Respondents with a salary of less than $50,000 made up 12.5 per cent of investors, while investors earning over $150,000 accounted for 16.7 per cent of investors.
“This is consistent with the view that those on relatively high incomes do not need to invest fractionally due to having the resources to purchase residential real estate outright,” the report noted.
Moreover, the typical investor was male, under the age of 55, and university educated, with an annual income of between $50,000 and $150,000.
The report noted that the typical investor viewed online fractional investment as a savings vehicle that could drive capital growth and rental returns, with most respondents expecting to hold on to the investment for more than five years, with an expected annual rate of return of up to 10 per cent.
The survey found that respondents view fractional investment as a substitute savings vehicle, rather than an investment that could facilitate future entry into the property market.
[Related: Aussies blowing the budget to buy a home]
Charbel Kadib is a journalist on the mortgages titles at Momentum Media.
Before joining the team in 2017, Charbel held roles with public relations agency Fifty Acres, and the Department of Communications and the Arts.
Charbel graduated from the University of Notre Dame Australia with a Bachelor of Arts (Politics & Journalism).