Why property investors are looking west
With the median house price in Melbourne and Sydney now well in excess of $1,000,000, investors are looking west as a way to build their property portfolio, while enjoying strong rental yields.
They are being rewarded with exceptional value. With a median house price of $552,128 (Apr, 2022), Perth is the most affordable capital city in Australia, besides Darwin, to buy property.*
*Source: Core Logic
Investors aren’t the only ones heading to Perth to find affordability. In the last quarter of 2021, Western Australia welcomed over 13,000 new residents from other states – its largest inflow on record.* With WA’s international borders permanently re-opened, this number is only set to increase.
*Source: WA Today
Record low vacancy rates
This has created a huge demand for rental properties in Perth, with vacancy rates down to a historic low of 0.9 per cent. This in turn has seen rents rise by 6.7 per cent, between March 2021-2022, according to the latest property report by CoreLogic*.
*Source: ABC News
While it is a tough time to be a tenant, it’s a great time to have an investment property in Perth.
Perth rental property is delivering strong yields, with the potential for healthy capital gains – without the turbulence of the stock market, or whiplash of cryptocurrencies.
The strongest rental yields of any capital city
Investors across the country are taking advantage of Perth’s low buy-in price and strong rental demand, to achieve average rental yields of 4.4% - the highest of any state capital.*
*Source: Core Logic
With a little research, it is easy to achieve in excess of this figure. Thoughtfully planned estates, with good amenity, and easy access to major transport routes and employment hubs, are delivering even stronger yields.
Brendan Acott, Managing Director of LWP Group, notes, “Estates like Ellenbrook near the Swan Valley, Trinity along Perth’s northern coastal corridor, and The Glades at the foothills of the Darling Scarp in Perth’s south-east, are all delivering rental yields of 5% or greater.”
He points out the best investment suburbs in Perth, share a number of attributes: “They’re all in growth areas, popular with young families and about to benefit from major government infrastructure projects.”
A new home in an in-demand estate offers the dual benefit of attracting more stable tenants, and having far lower maintenance costs than an older property.
This ability to more accurately predict outgoings, makes new homes a safer choice for the estimated 340,000* Australians who are ‘rentvestors’ and have to balance paying their own rent, with paying a mortgage and maintaining a rental property.ABS figures
As Sydney and Melbourne grapple with a housing affordability crisis, the rentvestors are demonstrating there are still ways to get into the property market – if you know where to look.