Property Trader versus Investors

Sue Tierney

Hi Shyam

My interpretation of a property investor is somebody who purchases a property with the intention of owning for many years to come. I consider a property trader is somebody who purchases a property with the explicit intention to resell it for a profit in the short term. That could mean redecorate/renovate and resell it one month or six months later. But specifically they settle knowing they will sell again in the short term. If you purchased with the intention of selling at a profit in the short term, lets say 6 months time, then you certainly wouldn’t expect to fix your mortgage for say a 2 yr fixed rate, because you could be faced with a penalty being charged by the bank when you sold the house in 6 mths time. That is usually one clue that separates traders and long term investors. Another differentiation would be whether you have signed up a tenant for a long term fixed tenancy such as a one year term. A trader intending to on sell a property in say 6 months is unlikely to take on a fixed term tenancy for 1 yr.

We're here to help you with home loans, personal finance & insurance.

Latest Insights

by Sue Tierney 15 Apr, 2024
Cutting costs is a smart move. Cancelling your insurance probably isn’t.
by Sue Tierney 15 Apr, 2024
Lately we’ve had lots of clients contact us about refinancing. In fact, we arranged more refinances last month than we did for the whole of last year.
by Sue Tierney 15 Apr, 2024
It was lovely to have time off over Easter. Even the end of daylight saving can be a blessing as it gives us brighter mornings for a while.

Wealth creation is not what you own. It’s what you control.

Deliver Sue’s insights straight to your inbox.

Share by: