More first home buyers are purchasing investment properties instead of homes to live in. Picture: Thinkstock. Source: Supplied

Mortgage Choice’s latest investors survey revealed 36.6 per cent of investors were first time buyers - up from 21.1 per cent at the same time last year.

When first time buyers were asked why they had bought an investment property rather than a home to live in, more than a quarter said because they could more easily afford.

About the same number said it allowed them to get their foot onto the property ladder, while around a fifth of respondents said it allowed them to “buy where they could afford and still live where they want”.

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Mortgage Choice chief executive officer John Flavell said the results weren’t surprising.

He said prices were rising particularly in capital cities where most people wanted to live.

“Australians increasingly want to live close to work and where the action is, which is why most people like to live as close to the capital city centres as possible,’’ he said.

“Of course, with prices rising across most capital cities, purchasing property near or close to the city is becoming increasingly difficult for buyers — especially first home buyers.’’

Mortgage Choice chief executive John Flavell said more first home buyers are buying investment properties. Source: Supplied

The result was an increase in the number of first time buyers purchasing investment properties which allowed them to buy where they can afford and still live where they want to.

Victorian respondents were most likely, 24.1 per cent, to say that was the reason they bought an investment property rather than a home to live in.

In Western Australia and New South Wales about a fifth of first home buyers said that was why they decided to invest first.

The phenomenon has been labelled reinvesting by real estate group LJ Hooker which recently released a White Paper on releasing a white paper on young buyers.

It said many young people had adapted the way they buy, use and invest in property to suit the way they want to live.

A wrap of the nation's property market for the week ending July 18th

“Young buyers have also looked to try to fund their current lifestyle by becoming investors, searching for positively geared properties to boost their regular income,’’ it said.

“The most common new buying habit, first identified in LJ Hooker’s The (new) Australian Dream white paper, is that of the rentvester.

“This buyer is currently renting and loves their lifestyle and doesn’t want to relocate from the area where they are presently living. The problem is that they can’t afford to buy in this area. Rather than disrupt their current lifestyle these buyers purchase a property in a more affordable part of the city or country, and rent that property out while they remain as tenants in their current location.’’

First home buyers are buying where they can afford and renting where they want to live. Picture: Thinkstock. Source: Supplied

Aussie Home Loans founder John Symond said last week that it was clear young people were not prepared to live in areas they didn’t want to live in.

“Young people today clearly want to live close to CBDs down the eastern seaboard,’’ he said.

“They want to be near their work because predominantly they work in the city, they want to be close to the cool restaurants and the bars.

“We are seeing a trend that has been happening now for a couple of years with young people with $50,000 or $100,000 refuse to buy to live in outer areas, they’d rather invest their money in the stock market and rent near the CBD and alternatively some of them are buying investment properties in areas where they would not live themselves and renting it out, at least they have their foot in the real estate door but renting because they want to live near the CBD.’’