Experts have run the numbers across every suburb in Australia to find those that tick every box for investors with some surprising results in the top 10.
A small town where half the homes are under $350,000 and a suburb with a ridiculous 0.1 per cent vacancy rate were among five areas in Queensland, four in Western Australia and one in South Australia that made an elite list for investors.
Depreciation experts Washington Brown and property analysis firm Hotspotting sought out the best areas for robust economic conditions, affordable locations and an array of conditions including “the Holy Grail of property investment – strong capital growth and rising yields”.
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Agriculture continues to be the mainstay in Dalby but the resource industry has also had an impact including CSG and electricity generation. Picture: GasFields Commission
Dalby
The Queensland town of Dalby, west of Brisbane – population just over 12,000 who have handled seasonal flooding when Myall Creek rises – was among the 10 most outstanding places in the country for property investment numbers – thanks to its thriving agriculture base and surrounding gas boom.
Washington Brown director Tyron Hyde said despite major shifts in the market, there were places that still ticked every box for investors who were also able to claim thousands in depreciation benefits.
For Dalby “with vacancies near zero, rents have risen 24 per cent in the past 12 months, with the median rental yield increasing from 6.6 per cent to 7.2 per cent in the past three months,” Mr Hyde said. “Property values have also soared, with the median house price up 15 per cent to $350,000 over the past year.”
Hotspotting Director Terry Ryder said the vacancy rate in Dalby had dropped to just 0.1pc, with the area being a centre for natural gas, coal, and power generation in the region with “a plethora of employment opportunities for residents”.
Massive crowds at the annual Ekka Royal Queensland Show at Brisbane Showgrounds in Bowen Hill. Picture: Richard Walker
Units in Bowen Hills & Woodridge – Brisbane
Two of the top 10 were in Greater Brisbane – units in inner city suburb Bowen Hills and southern suburb Woodridge. Rents in both places have jumped 15 per cent in the past year, with Bowen Hills vacancy rate at 1.2pc and Woodridge even tighter at 0.6pc.
Rental yields were at 6.6pc and 7.1pc respectively in the past three months, but where unit prices grew 7.1pc to $455,000 in Bowen Hills, in Woodridge they were up 24pc to $298,000.
“There is growing demand for properties, especially apartments, in Bowen Hills and surrounds due to its close proximity to infrastructure projects and its position in one of the top 30 most liveable cities in the world,” Mr Hyde said in a statement. “With its population expected to continue growing, the unit market is expanding to accommodate its new residents.”
Mr Ryder said “Woodridge in the Logan council area of Greater Brisbane is well-located and well-connected and is benefiting from its affordable price points for homebuyers and investors.”
House prices in Murray Bridge, South Australia, rose 22pc in the past year.
Units in Yorkeys Knob, Qld
The vacancy rate for units in this location near Cairns dropped from 1pc to 0.7pc in just three months with rents up 11pc in the past year, rental yield now 6.5pc and prices rising 15pc to $340,000.
“Yorkeys Knob has long been a popular suburb for tenants with some 50pc of its residents being renters,” Mr Ryder said in a statement. “There are also more units and townhouses than houses in the suburb, which ensures that investors are purchasing dwellings that are the most in demand by the people who want to live there.”
Bundaberg South, Qld
The median house price here has grown 6pc to just $370,000 in the past year, but rents were up 20pc, Mr Ryder said, lifting rental yield to 7pc off a 0.8pc vacancy rate.
“Bundaberg has a diverse economy that includes three hospitals as well as being home to higher education campuses, including the Central Queensland University.”
“Bundaberg’s population of more than 100,000 is also expected to grow by some 15pc in the next two decades.”
Hotspotting managing director Terry Ryder.
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Murray Bridge, SA
Mr Hyde said investors were able to claim thousands of dollars in depreciation benefits each financial year off their properties, including about $5,200 in Murray Bridge, South Australia, and more than $4,000 in Armadale, Western Australia – both of which made the top 10 list.
House rents in Murray Bridge jumped 27pc in the past year, with the vacancy rate at just 0.4pc, median rental yield 5.5pc and house price up 22pc to $415,000.
“The top industries in Murray Bridge include health care and social assistance – which employs about 15 per cent of its workforce – as well as retail trade, manufacturing and agriculture.”
Armadale, Balga, Carey Park, Geraldton – WA
Armadale is the fourth fastest growing LGA in Western Australia and 15th in Australia, Mr Ryder said, with a 31pc rise in house prices to $420,000, 26pc increase in rents, rental yield at 6.3pc and the vacancy rate at 0.4pc.
“The Armadale property market has gone from strength to strength over the past year, partly due to strong investor demand as well as affordable buy-in prices,” he said, “The population is approximately 91,000 and is expected to grow to 141,000 by 2036.”
Northern Perth suburb Balga, 42 minutes drive away, also made the list with its ridiculous 0.1pc vacancy rate, median rent rise of 22pc and prices up 22pc in 12 months to $465,000. Rental yield is sitting at 6.4pc.
“One of the major infrastructure projects in Balga is the $47.9m upgrade of Balga TAFE, which is due for completion at the end of this year.”
About two hours from Perth City is Carey Park in Bunbury where house prices are up 23pc to $370,000, rents up 15pc, vacancy rate at 0.6pc and rental yield at 7pc.
Washington Brown director Tyron Hyde.
“As well as having a diverse economy, Bunbury benefits from its strategic location as a key transport hub and gateway to the southwest region of Western Australia. Being two hours’ south of Perth, Bunbury also benefits from the economic influence of the larger metropolitan area.”
Four and a half hours north of Perth is Geraldton – an important service and logistics centre for mining – which made the top 10 nationally, after seeing prices rise 11.6pc to $355,000 in the past quarter, rents up 23pc, rental yield at 6.7pc and vacancies at 0.8pc.
Mr Hyde said “Geraldton’s population is expected to grow in the years ahead with its affordable price points being particularly attractive to first home buyers and investors”.