Can your first home double as an investment?

What we look for in a first home and what we look for in a rental property are 2 different things. When we look for a first home, we look for what we want. Things like, whats close to work? Where is my family? What size do I need for my family and I?

When we look for an investment property, we look for what the majority of people want – as we want to keep our potential tenant pool as large as possible. So we change these terms out for “what is close to the main labour hubs? Or What size house does the average family in this area need?”

And this is where we need to try and balance things. If it’s your first home and you plan on being in for a period of time, it’s important that this property has some personal adaptation to you, although there may be some investors that disagree.

Let’s take the following example:

Let’s say you live in Ashburton just outside of Christchurch and you’re looking to buy your first home (wahoo!). You work in Ashburton, but you see at the moment the, properties in Ashburton aren’t yielding up as much as somewhere in Christchurch, where you could be getting up to a whole % more yield. It's your first home, so should you be put off by the investment numbers?

Theres a couple of questions that you should be asking to check whether your first home might be able to double as a rental property.

Will people want to live here when I go to rent?
Rental demand has quite a few factors but some of the main drivers are population growth, housing supply, and economic. Things like having interest rates that may push people towards renting, or employment statistics in your area.

Population naturally has a large impact on rental demand – are new families moving into your area, potential to rent your new property? Or maybe people are moving away from your area to seek employment in the more metro areas.

Do you see your potential area being a long-lasting work or family town? Or maybe you fall into one of the towns in the country seeing migration out towards some of the main hubs.

The tenant is always right, in matters of taste
You’ve also got the matters of taste. I’ve seen some funny things since I’ve started in the industry, things that might be the absolute dream for one owner and could risk putting a potential tenant off. I’ve seen homeowners put completely clear windows in their shower and bathrooms, orange paint on the house, Converting Hot water cupboards into offices, and even clients asking to not have a driveway put in (and before you ask, no, this usually isn’t allowed.

All this to say, it is very important to make sure that the design features of your home match the status quo, to open you up to as big a tenant pool as possible. The further an idea is from the status quo, the more you should ask yourself: “Is this something I absolutely need? Or could I wait until I am in a home I don’t intend on using as a rental”

You’re allowed to want things.

You’re allowed to be excited about your first home. And you’re allowed to personalise it - to a point. But if you’re even remotely entertaining the idea that this home might one day become a rental, you’ve got to think a step ahead. What does Future You need this property to be?

Because here’s the golden rule: you can always add personality later, but it’s hard to strip it back when you’re trying to get someone else to love it as much as you did.

So what does this mean in practice?

It means thinking with both hats on - the homebuyer hat and the investor hat.

- Is the area trending well? Even if it’s not your forever town, are there signs it’s growing, developing, or at least holding steady?
- Would someone else live here? Not your best mate or your aunty, but a wide net of potential renters. If the answer’s yes, you’re on the right track.

But what if the numbers don’t stack up?

Sometimes you run the cashflow numbers, and yeah, maybe this first home doesn’t scream "textbook investment." Maybe the yield isn’t as high as Christchurch. Maybe the area doesn’t tick every box in the investor playbook.

Here’s where you zoom out.

The first property doesn’t need to maximise return; it needs to open the door. If you buy a home that holds value, grows steadily, and gives you the option to leverage into a second property later, you’ve already won.

So don’t let perfect be the enemy of smart. Smart means choosing a house that works for you now, but doesn’t limit you later. It’s a foot in the door, not your final destination.

So, can your first home double as an investment?

Yes - if you plan with both eyes open.
Yes - if you think long-term.
Yes - if you balance your heart with your head.

Because with the right mindset, the home you live in now could be the launchpad for your whole investment journey.

And hey, you’ll still get to pick the couch.