By Aska Soo April 21, 2025

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Two-thirds of Property Investors Are Experiencing Negative Cash Flow – What Does This Really Mean?

Property Market News
Two-thirds of Property Investors Are Experiencing Negative Cash Flow – What Does This Really Mean?

There’s been a lot of noise lately suggesting that property investors are raking it in thanks to soaring rents.

But when you look past the headlines and dig into the data, a very different picture emerges.

According to the 2024 PIPA Annual Investor Sentiment Survey, nearly two-thirds (65%) of property investors are currently experiencing negative cash flow

This is a substantial jump from 57% in 2023.

And let’s be clear, this isn’t a one-off blip.

Many of these investors expect the situation to continue for years to come.

What the data tells us

Here's how it breaks down:

67% of investors who own one property are in negative cash flow
72% of those with two properties are feeling the squeeze
66% of those with three properties are in the same boat with negative cash flow

And it's not just a temporary setback.

A significant portion of investors believe they'll be stuck with negative cash flow for five years or more, with some forecasting 10 to 20 years before they break even.

This isn’t surprising when you consider the environment we’re in.

Yes, rents have risen but they haven’t kept up with interest rates and skyrocketing holding costs like insurance, rates, land tax, etc.

Why this matters

Despite the narrative in some corners that investors are cashing in on the rental crisis, this data highlights a harsh truth: many investors are dipping into their own pockets just to keep their heads above water.

PIPA Chair Nicola McDougall rightly pointed out that this is not an ideal scenario.

In fact, over 40% of investors surveyed said their cash flows were “tight”, and another 11% were already dipping into savings to cover the shortfall.

And what’s driving investors to the edge?

Interest rates remain stubbornly high
Insurance, council rates, and maintenance costs have surged
Depreciation benefits and tax offsets can only do so much when you’re topping up the mortgage every month.

The bigger picture

Here’s something worth remembering: 71% of property investors only own one property.

Another 18% own just two.

These investors aren’t property moguls. They’re everyday Australians trying to secure their financial future and take pressure off the pension system.

Yet these same investors are often demonised in the media or targeted with ill-conceived policies like changes to negative gearing or additional land taxes.

And that’s the danger.

When governments or commentators suggest further penalising this group, it could have a ripple effect on rental supply because many investors are already on the brink of selling up.

In fact, 57% of those considering selling say it’s due to rising holding costs.

What should investors do?

At Metropole, we’ve always said property investment is a long-term game, but it must be strategic.

Negative gearing can be a valid short-term tactic if it's part of a well-thought-out wealth creation plan, especially when investing in high-growth locations.

But it’s not a sustainable strategy on its own.

Here are three things smart investors should be doing right now:

Review and renegotiate loans – Don’t just accept the bank’s default rate. Many investors are sitting on variable loans with interest rates that are 0.5% to 1% higher than necessary.
Reassess portfolio performance – Not every property in your portfolio will be a winner. Consider whether it's time to rebalance—especially if you're carrying underperforming assets.
Get professional advice – Now more than ever, investors need clarity, strategy, and support. This is not the time for DIY property investment.

Final thoughts

The latest PIPA findings should serve as a wake-up call not just for investors, but for policymakers too.

We’re in a period of recalibration. Investors are adapting to a new reality where holding costs outpace rental growth.

But as always, those with a clear plan, realistic expectations, and access to the right advice will not only weather this storm but come out stronger on the other side.

After all, property investment has never been about getting rich quickly, it’s about building long-term, sustainable wealth.

Are you wondering how you should invest in this interesting phase of the property cycle?

If you're like many property investors, you're probably wondering what's the right thing to do at present.

Should you buy, should you sell, or should you just wait?

You can trust the team at Metropole to provide you with direction, guidance, and results.

Whether you’re a beginner or an experienced investor, at times like we are currently experiencing you need an advisor who takes a holistic approach to your wealth creation and that’s exactly what you get from the multi-award-winning team at Metropole.

We help our clients grow, protect and pass on their wealth through a range of services including:

Strategic property advice – Allow us to build a Strategic Property Plan for you and your family. Planning is bringing the future into the present so you can do something about it now! Click here to learn more
Buyer’s agency – As Australia’s most trusted buyers’ agents we’ve been involved in over $4Billion worth of transactions creating wealth for our clients and we can do the same for you. Our on the ground teams in Melbourne, Sydney, and Brisbane bring you years of experience and perspective – that’s something money just can’t buy. We’ll help you find your next home or an investment-grade property. Click here to learn how we can help you.
Property Development - We enable you to become an “armchair developer” and get all the benefits of property development without getting your hands dirty. We take the hassles out of your investment by assisting you with all the expertise you need, from concept to completion, including construction. Click here to see if it’s the right way for you to grow your portfolio.
Wealth Advisory – We can provide you with strategic tailored financial planning and wealth advice. Click here to learn more about we can help you.
Property Management – Our stress-free property management services help you maximise your property returns. Click here to find out why our clients enjoy a vacancy rate considerably below the market average, our tenants stay an average of 3 years, and our properties lease 10 days faster than the market average.

About Aska Soo Aska is a passionate and driven professional with many years of experience as a property consultant helping clients achieve their financial goals through property acquisition. She has consulted clients around Australia by reviewing, educating, and advising clients about their financial situation and what they need to achieve their end goal of being financially free.