Property investment is not a dice roll. You have to do your homework and find an investment property that will give a good rental return and increase in value over time. These 11 tips will help you find the right investment property. One: Smart property investment Smart property investment means doing your sums ahead of […]
Finding the right apartment to invest in takes time and a lot of research. One of the major hurdles to overcome is identifying the right location. The key is to find growth suburbs with low supply and high demand. Here are ten areas around Australia to invest in an apartment:
1. Canberra, ACT
Enjoy the benefits of a steady Canberran market in suburbs like Conder, Amaroo and Theodore where median prices range between $414,000 to $440,000 and rental demand is high with a solid rental yield of 5.1% for the capital.
Ngunnawal is leading the way in the ACT with a capital growth score of 69 according to PropertyValue.com.au, which is powered by CoreLogic. The median price in this cosy suburb is $410,000. Driven by excellent local schools, and a close proximity to Gungahlin Town Centre the rental yield is 5.2%.
2. Melbourne, VIC
Melbourne may be cooling, but you will find real value in the outer areas with suburbs like Cranbourne, Lilydale, Koo Wee Rup and Beaconsfield. Skye is a hidden gem on the outskirts of Melbourne’s south-east, and with a high capital growth score of 89, it’s a safe bet for solid returns. Median sales prices sit at $428,000 and the annual growth rate is 9.9%.
Next door, Cranbourne is thriving with its close proximity to the Royal Botanic Gardens, the racecourse and commercial centre. Apartments are priced at a median of $360,000 with plenty of growth. Beaconsfield offers a country feel with city amenities and is known for having some of the top schools and daycares in Victoria. Quick access to the freeway and good public transport makes the median price attractive at $463,000.
3. Ballarat, VIC
The gold rush is back! Savvy Melbourne millenials are rushing into the town of Ballarat to mine for property investment gold. With Melbourne just over an hour away by rail, Ballarat is fast becoming a popular area to invest due to its affordable market. Central suburbs like Soldier’s Hill, Sebastapol, Redlan and Ballarat East offer high rental yields and annual growth. Ballarat East’s rental yield is 6.1% and median sales prices are only $246,000. It’s easy to see why investors are adding this town to their portfolios.
Large infrastructure projects such as the Eureka Stadium development, the Ballarat Link Road and the Ballarat West Employment Zone are set to boost employment and population growth, which will continue to drive demand according to QBE’s Australian Housing Outlook.
4. Sydney, NSW
Sydney may be in an affordability crisis, but thanks to its strong economy, growth is still looking good. Getting into the market might be easier in areas like Liverpool, Blacktown and the Greater Parramatta area. With the new airport at Badgerys Creek, Liverpool’s local economy is bustling.
Investigate outer areas that are well linked to public transport, like Macquarie Park, Fairfield, Petersham, Stanmore and Croydon Park. Suburbs such as Ashfield, Green Square and Marrickville are only a few stops from the city.
5. Illawarra, NSW
A little over an hour from Sydney, Illawara is seeing some of the highest capital growth scores in the country for apartments, according to PropertyValue.com.au. With the region benefitting from deteriorating housing affordability in Sydney, the close proximity of the city and alluring lifestyle makes it an obvious choice for a sea-change.
The Shellharbour suburb of Warilla is performing well with a capital growth score of 74 and a median apartment price of $483,000. Increasing 82.0% over the past five years, this puts Warilla’s annual growth rate at a tidy 12.7%. Port Kembla scored in the top at 81 and Barrack Heights at 73.
6. Maitland, NSW
Maitland, Cessnock and Toronto are seeing the ripple effects of Newcastle as they continue to experience high levels of growth. Close to Newcastle and on the doorstep to the Hunter Valley, areas like Thornton, East Maitland and Ashtonfield are booming. The median sales price in Thornton is $429,000 and $325,000 in East Maitland.
7. Brisbane, QLD
While Sydney and Melbourne are cooling, Brisbane is a buyer’s market, affordable due to an oversupply of apartments. With roughly 20% of units unoccupied, prices have been slashed. It’s not likely that prices will stay this low with developments easing, so it could be the perfect opportunity to invest. Capital growth may be slow in the inner city right now, but rental yields are strong and demand is on the rise.
8. Gold Coast, QLD
As Brisbane continues to be in oversupply, the Gold Coast is burning up with demand for coastal apartments partially due to the Commonwealth Games, but largely because of lifestyle factors.
Moments from the beach and Burleigh Heads National Park, and in the thick of all the amenities, Burleigh Waters is a popular choice for investors. With apartments priced at a median of $439,500 and property value increases of 7.2%, you should see a tidy ROI. Comparable to the rest of Queensland, Burleigh Waters has higher rental yields at 5.09% and reaches 903 visits per property as listed by realestate.com.au (May 2018). Sister suburb Miami is following suit.
9. Sunshine Coast, QLD
There is still strong confidence in Noosa’s economy which is supported by multiple projects and developments to infrastructure. The median unit price in the picturesque suburb of Tewantin is $349,000 and with 598 visits per property on realestate.com.au demand is high. Tewantin is experiencing a stable annual growth rate of 3.7% and offers good rental yields for units at 5.2%. Other areas to investigate are Forest Glen and Buddina.
10. Cairns, QLD
Cairns is being touted as the next hot property spot in Australia. With expansions to the port, naval hub, Cairns Convention Centre and two major universities, combined with other significant investments in the works, Cairns is seeing a lot of action. And this means jobs! Already at 11.2% for job growth in the city, Cairns is flourishing and this is definitely going to make a big impact on property. With its tropical lifestyle, strong tourism sector and growing economy, Cairns has a lot of appeal.
Rental returns are high, with suburbs like Woree reaching 9%. Apartments are affordable and in Cairns City the median price is $275,000 for apartments with a rental yield of 6.4%. Inner city suburbs like Manoora and Edge Hill have cheaper apartments (below 200k) and higher rental yields around the 8% mark with steady growth. With tight vacancy rates of 1.5%, rental properties are in hot demand with an average of 561 visits per listing via realestate.com.au.
Don’t underestimate the power of regional areas which are set to outperform the metropolitan areas this year!