I’m in my 30s with a spare $100,000. Should I buy an investment property?

3 hours ago 1

Opinion

September 16, 2025 — 11.52am

I’m in my 30s with a stable income, and have about $100,000 to invest. I already have a home and enough cash in my offset to match my outstanding mortgage amount, so this is on top of what I have in my offset. I have some ETFs already, but I’m thinking maybe I could get an investment property. I know a buyer’s agent, who has recommended a property. I’m hoping it’ll appreciate in a few years, and then I can sell it and reinvest the money into ETFs later. Which is the best option?

What makes an investment the “best” investment? Is it the one that will give you the highest, fastest return, with the lowest risk (this is tongue in cheek: be wary of anyone promising all three of those things, because lowest risk won’t typically produce big, fast returns, and vice versa)?

There’s no easy answer when comparing ETFs to property, but the latter certainly involves more ingredients.

What if there is no such thing as the “best” investment? What if there are simply some investments that are better suited for you, personally, than others? Then, the goal isn’t to find the biggest or fastest return – it’s to find investments that are a good fit for your personal goals.

How do you do that? Here are some factors to consider.

Have you factored in fees when calculating your expected returns? You can’t control or predict returns. Sure, you can make educated estimates and use historical data to make an informed decision, but the future is, and always will be, unpredictable.

So it’s not a good idea to expect specific returns in a specific time frame. You might be able to use historical data to give an idea of what is reasonable to expect long-term, but it sounds like you’re “hoping” a property will give you enough growth in a few years that you’ll be able to sell it for a profit and re-invest the capital. What is this “hope” based on? Is it reasonable?

How confident are you in your (or your buyer’s agents’) ability to select a ‘good’ property?

However, you do have some control over costs, which will eat into your returns. You can do your best to keep costs low and ensure you keep more of whatever returns you do get.

One of the advantages that ETF investing has over property is that you can keep costs relatively low. Property is an “expensive” asset – to get into, hold on to, and get out of. There are many added costs – interest rates, stamp duty, insurances, maintenance and repairs, etc.

With any investment, you want to make sure you’re factoring expenses into your calculation of whether that investment is going to net you a good return, long-term.

How much time, energy and money are you willing to spend on maintenance? Buying investments isn’t the end of the road – there’s also work involved in maintaining them.

For ETFs, that could look like: reviewing and adjusting your asset allocation, reinvesting dividends, and preparing tax returns each year. For property, that could look like ongoing maintenance and repairs, finding new tenants when old tenants leave, dealing with strata, reviewing and refinancing loans as appropriate, collecting and chasing up rent, etc.

Yes, you can outsource management. However, going back to my first point: whether you’re signing up with a robo-advisor to manage your ETFs, or a property management company to manage your property, there will be fees involved, which will eat into your returns.

How confident do you feel dealing with the complexity of the investment? Many assume that sharemarket investing is complicated. Once upon a time that was truer than it is today, but ETFs and index funds have changed this considerably. Nowadays, in some ways, there’s less complexity involved with ETF investing than with property.

Buying property is an “active” form of investing. It is the equivalent of “stock picking” for real estate. Your returns are not just driven by the market – they’re dependent on the performance of the specific asset you choose.

So, how confident are you in your (or your buyer’s agents’) ability to select a “good” property? Do you know what you’re investing in and why – or are you just hoping it’s a good investment because someone else told you so?

The other complication with property is it’s a “team” sport. There are numerous parties involved – from the bank and mortgage broker, to contractors and insurers.

Each party adds risk and complexity. Being successful at property investing is not just about picking good properties; it’s also about picking good team players, and knowing how to work with them.

The right investment is less about the investment and more about the investor. Instead of asking whether property is better than ETFs – start asking whether the journey of property investing is a better fit for you as an investor than the journey of ETF investing?

You can get to the same destination in different ways – so don’t just pick the destination, pick the journey.

Paridhi Jain is founder of SkilledSmart, which helps adults learn to manage, save and invest money through financial education courses and classes.

Advice given in this article is general in nature and not intended to influence readers’ decisions about investing or financial products. They should always seek their own professional advice that takes into account their own personal circumstances before making any financial decisions.

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