investor family buyers

Why an investor needs to steer clear of family buyers

I am a small time property investor.

As an investor I have bought my properties mainly at fire sale auctions (generally properties being sold by receivers or banks). These days it seems that auctions are moving to online platforms meaning you have no idea who you are bidding against.

This was not always the case. Just a couple of years ago we all sat in a room and raised our hand to bid. When doing so we would inevitably look around to see who we were dueling against for the property.

I remember one occasion in particular when I was bidding on a home and looked around to see my bidding nemesis. It was in fact a husband and wife with 2 kids. I stopped bidding and they immediately won the auction.

A sense of justice you might think? My highly trained moral conscience told me to give it to them? Well perhaps but more so was the fact that I wanted the property as an investment and they wanted it as a family home. As such I knew they would be willing to pay a lot more than I would.

An investor like myself does the math on the property price versus the return on rental and come to a maximum value they are willing to pay (this is called the rental yield and it is now quoted as a percentage of the guide price versus the rental return on property bidding websites such as

Family home buyers generally don’t do such math and instead simply need a place to live. As such bidding against them as an investor almost always ends in them winning.

You can find some property bargains on

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