Two Types of People Who Should Genuinely Never Buy Investment Property

I'm about to say something that 99 out of 100 buyer's agents would never say, because it's bad for business.

Some people should not buy property.

I mean it. There are personality types — patterns of thinking — that are fundamentally incompatible with how property investment works. And if you recognise yourself in either of the two types I'm going to describe, I'm not going to pitch you anything. I'm going to tell you to be extremely cautious. Because buying the wrong property at the wrong time with the wrong mindset can cost you five years of your life.

I'm Joey. I only say what I mean.

Type 1: The penny-wise person who grabs the sesame seed and misses the watermelon

I'm not criticising this person. They have real strengths — they're careful, analytical, detail-oriented. They track every dollar. They notice when one suburb is $20K cheaper than another and they fixate on that difference.

But property is a long-horizon asset. And people who optimise for short-term costs consistently underperform people who optimise for long-term trajectory.

Here's what I mean. I'll put two charts in front of this client. Melbourne's outer southeast — Cranbourne, Narre Warren, Hampton Park — has appreciated 12-16% over the past twelve months. The data is right there. Comparable sales up. Rental yields strong. Population influx from first home buyers and migrants. The cycle is turning 1.

They look at the chart. They acknowledge the numbers. And then they ask: "But isn't Melbourne's stamp duty higher than Queensland's? And don't they have higher land tax?"

They're comparing a $3K stamp duty difference against a potential $80K capital appreciation over two years. They're picking up the sesame seed while the watermelon rolls away.

I had a hilarious situation last year. A client who'd bought five properties in Melbourne in twelve months was publicly bad-mouthing Melbourne in our group chat. I asked him why. He laughed and said: "Because I don't want anyone competing with me for the good deals" 2.

That's a man who understands trajectory. He doesn't care about the marginal cost differences between states. He cares about where the growth is happening, and he's loading up while others are distracted by stamp duty calculators.

The penny-wise investor would have read his negative comments and concluded Melbourne was a bad bet. And they would have missed a 12-16% run.

If you find yourself spending more time comparing transaction costs across states than analysing capital growth drivers within a market, property investing will frustrate you. You'll always be chasing the cheapest entry point rather than buying into the strongest trajectory.

Type 2: The rearview driver who uses yesterday's data to predict tomorrow

This one is more common and more dangerous.

This person looks at what happened in the last three years and assumes it will continue for the next three years. If a market hasn't grown recently, they conclude it won't grow in the future. If a market has been running hot, they conclude it will keep running.

Both are wrong. And both are expensive.

Let me give you the pattern. Perth and Adelaide in 2020: ten years of virtually flat growth. The rearview driver looked at a decade of stagnation and said "not touching it." Then both markets took off — 20-30% growth over the next few years 3.

The rearview driver missed the bottom. They sat on the sidelines through the entire first two years of the growth cycle, watching and waiting for "confirmation." By the time they felt confident enough to buy — after seeing three years of consecutive growth — they were buying near the top.

And then what happened? Perth plateaued. Growth slowed. The rearview driver, who bought in year three of a five-year run, is now sitting on an asset that's barely moved for two years. They expected another three years of 10% growth because the last three years delivered that. The market had other plans.

Meanwhile, the people who bought early — during the flat period, before the growth started — already cashed their gains. Some of them sold. Some refinanced. All of them are better off than the rearview driver who waited for "proof" 4.

Now apply this to Melbourne. Melbourne has been flat for roughly three years. The rearview driver sees three years of stagnation and concludes the market is dead. They won't buy here because "it hasn't been performing."

But our data shows the early indicators are already shifting. Three-month price changes in the eastern suburbs are turning positive even while twelve-month numbers are still negative or flat 5. That's the leading edge of a cycle turn. The twelve-month data is backward-looking. The three-month data is forward-looking.

By the time the twelve-month data confirms the uptrend, the easy money has already been made. The rearview driver will buy in month 18 of the recovery, pay 10-15% more than they would have at the bottom, and then wonder why their returns are mediocre.

If you can't bring yourself to buy an asset that hasn't recently performed — if you need historical proof before committing — property cycles will consistently chew you up. You'll buy late, hold through the plateau, and sell frustrated.

Why property punishes these mindsets specifically

Shares don't punish these traits as badly. If you buy a stock after it's run 30%, you can sell it next week if you change your mind. Transaction costs are minimal. Liquidity is instant.

Property is different. You buy. You pay 5-6% in stamp duty and transaction costs. You can't sell for at least two years without incurring punishing short-term CGT. The asset is illiquid — selling takes eight to twelve weeks in a good market, longer in a bad one 6.

So when a penny-wise buyer picks the "cheaper" market rather than the better one, they're locked into that decision for years. And when a rearview driver buys late in a cycle, they're stuck holding through the downturn because selling would crystallise a loss.

Property rewards patience, conviction, and long-term thinking. It punishes short-termism, hesitation, and backward-looking analysis. If those second traits describe your default decision-making style, you need to either consciously override them or accept that property may not be the right asset class for you.

I've seen it play out dozens of times. An investor buys in year four of a five-year cycle. The market flattens. Their property plateaus for seven years. Seven years of mortgage payments, maintenance, property management fees — and the asset barely moved. One wrong decision, and the whole family tightens their belt for the better part of a decade 7.

That's real. That happens. And it's preventable.

What the right mindset looks like

The investors who build real wealth in property — the ones I've watched go from zero to four or five properties in five years — share a few traits.

First, they think in cycles, not snapshots. They understand that markets don't go up forever and they don't stay flat forever. They buy when affordability is favourable and growth indicators are turning — not when growth is already confirmed by three years of data.

Second, they focus on fundamentals over feelings. Land value ratio above 80%. Rental yield above 5%. Owner-occupier ratio above 60%. Vacancy rate below 3%. These are the numbers that predict five-year outcomes. Whether the property "feels" like a bargain today is irrelevant 8.

Third, they commit and they hold. They don't second-guess after buying. They don't check comparable sales every week. They set the strategy, execute, and review annually. The emotional energy they save by not obsessing over monthly price movements is enormous.

And fourth, they get professional help. Not because they're lazy. Because they recognise that a buyer's agent who transacts 100 properties a year sees patterns that someone buying their first investment property cannot see.

Our team bought nearly 100 properties last year in Melbourne. Every one was positively geared. Every one was on land exceeding 600 square metres. Every one had a land value ratio above 80%. The data from those 100 transactions gives us a view of the market that no individual investor — no matter how clever — can replicate from their living room 2.

If you're either of the two types I described and you still want to invest in property, the best thing you can do is work with someone who will counterbalance your tendencies. Someone who'll tell you "stop comparing stamp duty and look at the growth trajectory" or "stop waiting for proof and look at the leading indicators."

That's what we do. And if you're interested in having that conversation honestly, reach out.

I'm Joey Don. I'd rather lose a sale than let someone buy wrong.