Joint ventures driving new property market opportunities
As property prices continue to rise, joint ventures will likely become a key model for funding Australia’s growing housing demand.
Joint venture property developments are emerging as a dynamic alternative for investors seeking entry into Australia’s surging housing market.
With living costs on the rise and property prices growing steadily, more Australians are teaming up financially to secure a foothold in the market.
In fact, 6.7 per cent annual property price growth was recorded to September 2024, amplifying the need for innovative investment strategies. In Brisbane and Adelaide this was 19 per cent and in Perth a massive 30 per cent.
Barry Jennings, CEO, Infinite Investments said joint ventures are allowing everyday Australians to break into developments that were previously only accessible to high-net worth individuals.
“It’s a game-changer in terms of market accessibility.”
“By pooling resources, smaller investors can now access lucrative high-return developments once exclusive to institutional players.
“These projects, ranging from residential to commercial, offer shared financial benefits and lower entry barriers.”
How real estate joint ventures work
A joint venture (JV) involves two or more parties combining expertise and capital for a property project.
For example, if a development requires $1 million in funding, 20 smaller investors could each contribute $50,000.
Investors typically receive returns through either rental income and project sale profits, with voting rights determining key decisions like whether to sell or rent completed units.
Large-scale JV developments benefit from economies of scale, offering higher profit potential compared to individual residential investments.
Amid a housing shortage, this can lead to premium sale prices, while lower per-unit construction costs improve rental yields. The demand for more flexible work-from-home spaces also provides opportunities to meet new market preferences.
Mr Jennings began Infinite Investments to manage and deliver multi-dwelling properties with various partners in 2015 and boasts a 100 per cent project completion success rate to this date. “
“In more recent years, the need to bring the knowledge of navigating JV legalities together with development research and processes became more apparent.
“This makes higher return projects more accessible to everyday investors who want to avoid the risks of normal investment strategies.”
Mr Jennings said they were seeing strong demand for multi-residential developments.
“With the current rental pressure and low vacancy rates, JVs provide a win-win scenario for both developers and investors by tapping into housing needs that just aren’t being met.”
The future of joint ventures
While JV developments reduce barriers to entry and allow portfolio diversification, they’re not without risk.
Delays in construction, regulatory issues, or majority voting conflicts could impact returns. Nonetheless, partnering with seasoned developers offers more security than going solo.
As property prices continue to rise, joint ventures will likely become a key model for funding Australia’s growing housing demand.
Developers are already using fractional ownership structures to engage smaller investors, creating new avenues for individuals to participate in large-scale property developments shaping urban landscapes.
