How James Turned $40K Into a Property Portfolio Through Rentvesting

By Molly Benjamin, Founder of Ladies Finance Club

Listen to the full podcast here.

In this episode of Get Rich, I sat down with James Kerr from InvestorKit to unpack how he turned a $40,000 deposit into a thriving property portfolio by embracing the strategy of rentvesting. If you’re priced out of your local property market or unsure whether to buy or rent, this episode is a must-listen.

We cover everything from what rentvesting really means, how to get started with minimal savings, using equity to build your investment portfolio, common mistakes first-time investors make, and why your first property probably shouldn’t be your dream home.

What Is Rentvesting and Why Is It a Smart Property Investment Strategy?

Rentvesting is a strategy where you rent a home in a location you love (hello Bondi Beach!) while investing in property somewhere more affordable with better growth potential. Instead of waiting to buy a home you can live in, you get on the property ladder sooner by investing smartly elsewhere.

James shared how he became an accidental rentvestor after selling his underperforming home and using the remaining $40K to invest in Perth. By focusing on growth markets and leveraging property equity, he built a property investment portfolio while still renting in a suburb he loved.

How to Start Rentvesting With a Small Deposit

Think you need $100K+ to start? Think again. James walked us through how:

• He used a $40K deposit to buy a property in Perth
• He looked for positively geared properties in growth suburbs
• He outsourced the heavy lifting to a buyer’s agent

The key takeaway? You don’t need to live where you invest, you just need a clear investment strategy and the right support.

Using Equity to Build Your Property Portfolio

Once your property goes up in value, you can tap into that equity to fund your next purchase. James explained how after just a year, his Perth property had grown by over $100K, giving him the equity to invest again.

This is how you go from one property to many, without needing to save a massive deposit each time. But remember: this only works if you’ve bought in the right market.

City Living, Regional Investing: Why Location Matters in Real Estate

Many aspiring investors fall into the trap of only looking in their own backyard. But as James explained, real estate is hyper-local. The right suburb in the right city at the right time can mean the difference between a property that barely moves and one that grows $100K in a year.

He also shared a list of what to look for:

• Strong rental demand
• Low vacancy rates
• Suburbs with infrastructure growth
• Properties with 3+ bedrooms, garage, and away from main roads

The Role of a Buyers Agent in Your Investment Strategy

James and I are both huge advocates for using a buyer’s agent. Why? Because they:

• Do the research
• Know how to negotiate
• Have access to off-market deals
• Can save you from making costly mistakes (like buying emotionally)

This is a six-figure decision. It’s worth getting expert advice.

Common Property Investment Mistakes First-Time Buyers Make

Some of the big ones James sees:

• Buying an apartment in their own suburb (because Mum said it was a good idea)
• Getting emotional about a property instead of treating it like a business
• Failing to diversify across different markets

It’s not about what you like; it’s about what the market demands.

Can You Still Invest on a Low Income? Absolutely.

James shared his story of investing while earning $60K a year, thanks to support from a guarantor and by keeping costs low. Other options include:

• Self-managed super funds (SMSFs)
• Joint ventures with friends or family (with legal advice!)

The key is having a buffer, getting clear on your goals, and not rushing in.

Should You Pay Off Your Mortgage or Keep Investing?

This one sparks debate. But James broke it down:

• Paying off a mortgage slowly builds equity
• Investing in more properties (the right ones!) allows you to leverage and build wealth faster

It depends on your goals, but don’t let fear of debt hold you back from growing your investment portfolio.

What About Government Policy and the Property Market?

Yes, rules and taxes can change. But the overall trend in property is long-term growth. As James said, don’t try to time the market. Focus on time in the market.

Your Dream Lifestyle Doesn’t Have to Wait

Rentvesting gives you the freedom to live where you want, while still growing your wealth. Whether that’s by the beach, in a bush suburb, or close to work—you can create a lifestyle you love now, while your real estate investments work behind the scenes.

Rentvesting isn’t for everyone, but it might be the smart strategy you’ve been waiting for. Whether you’re just getting started or looking to grow your portfolio, James’ advice is clear: get educated, use experts, and stay the course.

Want to learn more? Check out InvestorKit for property investment research and buyer’s agent services. And don’t forget to listen to the full podcast episode for more real-life tips and insights.

Plus, a huge shoutout to our sponsor, InvestorKit! Australia’s #1 Buyers Agency for 2023 and 2024. They specialise in helping investors find high-growth properties utilising industry leading AI and data driven research process across Australia. 70%+ of the properties they purchase are off-market and they have consistently outperformed national average capital growth rates by over 49%. Whether you’re looking to build your property portfolio or secure your first investment. Check them out here.