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InvestorKit CEO Arjun Paliwal reveals how data, segmentation, and smart debt strategies like rentvesting can help investors find hidden growth pockets and stay ahead in a shifting market.
Investors should harness data and debt-optimisation strategies, such as rentvesting and downsizing, to navigate Australia’s dynamic housing market, according to Paliwal.
Speaking at the inaugural Smart Property Investment roundtable, co-hosted by The SPI Show’s Phil Tarrant, 33-year-old entrepreneur Paliwal unpacked how savvy investors are using technology and market segmentation to outmanoeuvre macroeconomic pressures and find growth in unconventional places.
Listen to the full roundtable discussion on the Smart Property Investment podcast.
A former Commonwealth Bank branch manager who now leads the national research-driven buyer’s agency InvestorKit, Paliwal said his data-led investment philosophy was born out of his early banking years.
“Back in 2017, I was working in the head office and heavily involved in data, which sparked my interest in applying research to property investing. While others focused on Sydney and Melbourne, I saw potential in other entry markets,” Paliwal said.
“At the time, colleagues thought I was crazy for looking there, but the data told a different story. I picked up a block of four units for $365,000, renting for around $700–800 a week. I invested $130,000 in renovations, and today that property is worth over $1.2 million, generating around $1,300 in weekly rent.
“It’s one of my best investment decisions. The experience showed me how combining on-the-ground lending knowledge with data-driven analysis can uncover serious opportunities in unexpected places.”
Paliwal said successful investing in the current environment hinges on understanding how markets behave at a local level – not just reacting to rate moves by the Reserve Bank.
“The fundamentals of Australia’s position are still rock solid when it comes to real estate as an asset class,” he said, pointing to the nation’s $11.4 trillion housing market and an average loan-to-value ratio of just under 30 per cent.
In analysing the market, Paliwal identified three phases of investor activity emerging in response to the interest rate cycle. The “first wave” of investors are already acting on anticipated cuts, while a second wave will enter as rates fall, followed by a third group whose borrowing power improves post-cuts.
But local supply and demand factors still dominate performance, splitting the market into three key segments: early adopters, hotspots, and second wind markets.
“We like to break the market down into three simple buckets: early adopter markets, which are just starting to show signs of growth; hotspot markets, where competition is fierce and properties are flying off the shelves; and second wind markets, which had a boom, cooled off, and now look ready to bounce back,” Paliwal explained.
“This kind of framework makes it much easier to make sense of what’s happening across the country. While Melbourne might be showing early recovery signs, places like Perth or Townsville are still running hot.
“Once you know where each area sits, you can be a lot more strategic with your portfolio and manage your risk more effectively.”
Through InvestorKit, Paliwal and his team track real-time market signals to map opportunities and risks. He argued that investors are now less tied to geographic proximity, thanks to digital tools, allowing portfolio diversification across states and property types.
Though, as borrowing capacity tightens for many investors, the property expert noted that interest in self-managed super funds has surged. Self-managed super funds, according to Paliwal, provide an opportunity to keep investing using super contributions and rental income. But he warned that investors must seek advice to avoid under-diversified portfolios.
He also encouraged strategic downsizing or delaying the gratification of buying luxury forever for those in their 40s, maintaining a modest principal residence while unlocking equity to support wider portfolio growth. This tactic, he said, helps investors expand their risk appetite while keeping retirement goals on track.
For younger investors, rentvesting – renting where you want to live while buying elsewhere – remains a powerful pathway, but requires discipline.
“A common trap rentvestors fall into, especially couples, is constantly debating whether to keep investing or buy a home to live in. This indecision can lead to years of lost progress,” he explained.
“We’ve seen it firsthand: two couples on the same income, one fully committed to rentvesting, the other stuck in ‘shall we, shall we not’ mode. The committed couple ended up with two more properties on average.
“The key? Be clear on your goal, stick with it, and don’t let home ownership debates derail your investment strategy.”
Listen to the full roundtable discussion on the Smart Property Investment podcast.
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