Australia’s Highest Rental Yield Suburbs in 2022

Investing in a property with the best rental yield possible ensures you get a good return on your investment. Rental yield is your annual rental income from the property and is shown as a percentage of the property’s value. Naturally, a higher rental yield means the investment property will give you higher cash flow.

While various factors contribute to the rental yield of each property, location is a big one. We’ve compiled rental yield data for major locations around Australia to help you find the perfect investment property.

What is a good rental yield in Australia?

Good rental yield in Australia
What is a good rental yield?

A good rental yield in Australia falls anywhere between 7% and 8% for capital city suburbs. In the regional areas, houses bring rental yields of 12% to 13%, while you can expect rental yields of 8.5% to 11% for units. 

The best rental yields in 2020 were found in Collinsville, Queensland at 14.6% and South Hedland, Western Australia at 14.1%.

 

Here are the highest rental yield suburbs by city in Australia

Best rental yield suburbs near Sydney, NSW

# Suburb Region Rental yield (%) Median rental value ($)
1 Blue Haven Central Coast 4.7 465
2 San Remo Central Coast 4.6 438
3 Charmhaven Central Coast 4.5 438
4 Watanobbi Central Coast 4.4 446
5 Lake Haven Central Coast 4.4 456
6 Mount Victoria Sydney – Outer West and Blue Mountains 4.4 447
7 Gorokan Central Coast 4.3 423
8 Kanwal Central Coast 4.3 445
9 Summerland Point Central Coast 4.3 459
10 Gwandalan Central Coast 4.2 460

Source: CoreLogic

The above table is taken from the Corelogic report and provides an overview of the best rental yields in Greater Sydney.

The Sydney rental market has been significantly impacted by the closure of international borders and repeated closure of state borders during this COVID pandemic. Historically, a high proportion of immigrants to Australia initially rent before some go on to buy. With the overseas market completely gone, Sydney rent prices have fallen due to lower than average demand.

According to SQM Research data, the gross rental yield in and around Sydney is 2.5% for houses and 3.4% for units. The average median sale price* in Sydney is currently $1,686,257 for houses. This is more than 30% higher than prices when the pandemic began.

The average for units is $702,678, which is only a slight drop from figures early in the pandemic.

*SQM Research updates their figures weekly.

Best rental yield suburbs near Brisbane

Brisbane rental yields
Rental yields near Brisbane
# Suburb Region Rental yield (%) Median rental value ($)
1 Riverview Ipswich 6.9 317
2 Kilcoy Moreton Bay – North 6.8 378
3 One Mile Ipswich 6.5 320
4 Kingston Logan – Beaudesert 6.5 369
5 Goodna Ipswich 6.5 357
6 Leichhardt Ipswich 6.4 322
7 Logan Central Logan – Beaudesert 6.4 356
8 Woodridge Logan – Beaudesert 6.4 357
9 Laidley Ipswich 6.3 321
10 Russell Island Brisbane – East 6.3 293

Source: CoreLogic

The above table is taken from the Corelogic report and provides an overview of the best rental yields in Brisbane.

The COVID pandemic has affected the Brisbane rental market but not as dramatically as in Sydney and Melbourne. Rental prices have remained relatively stable throughout the pandemic, despite a lack of international immigrants. This may be due to an influx of people moving to Brisbane from interstate. Both the Gold Coast and the Sunshine Coast in Queensland were in the top three destinations for internal migrants during the pandemic. The Sunshine Coast experienced the highest annual capital growth in houses nationally.

According to SQM Research data, the gross rental yield in Brisbane is 5.2% for houses and 3.7% for units. The average median sale price* in Brisbane is currently $743,428 for houses. This is almost $100,000 more than the price at the beginning of the pandemic.

The average median sale price for units has remained relatively stable in Brisbane and is currently $397,859.

*SQM Research updates their figures weekly.

Best rental yield suburbs near Melbourne

# Suburb Region Rental yield (%) Median rental value ($)
1 Melton Melbourne – West 4.5 340
2 Hastings Mornington Peninsula 4.2 455
3 Harkness Melbourne – West 4.2 377
4 Melton South Melbourne – West 4.1 360
5 Kurunjang Melbourne – West 4.1 358
6 Campbellfield Melbourne – North West 4.1 383
7 Frankston North Mornington Peninsula 4.1 346
8 Maddingley Melbourne – West 4.1 402
9 Dallas Melbourne – North West 4.0 378
10 Meadow Heights Melbourne – North West 4.0 384

Source: CoreLogic

The above table is taken from the Corelogic report and provides an overview of the best rental yields in Melbourne.

The Greater Melbourne rental market was severely impacted in 2020 with a drop in rental prices of -7%. Not only has Melbourne faced border closures, it has also experienced multiple long lockdowns, which have likely exacerbated the rental price decline. The rental market has dropped further this year but will likely begin to increase once the international borders open to immigrants. 

According to SQM Research data, the gross rental yield in Melbourne is 2.5% for houses and 3.4% for units. The average median sale price* in Melbourne is currently $1,104,885 for houses. At the beginning of the pandemic, the average price was just shy of $1,000,000. With a increase of close to 10%, it’s clear that prices in Melbourne have not risen as dramatically as in other states during the pandemic.

For units, the average median sale price in Melbourne is currently $570,695, which is approximately $20,000 higher than early pandemic prices.

*SQM Research updates their figures weekly.

Best rental yield suburbs near Adelaide

Best rental yield suburbs near Adelaide
Rental yields near Adelaide
# Suburb Region Rental yield (%) Median rental value ($)
1 Elizabeth North Adelaide – North 8.3 282
2 Elizabeth Downs Adelaide – North 7.7 296
3 Elizabeth South Adelaide – North 7.6 287
4 Davoren Park Adelaide – North 7.5 287
5 Elizabeth Grove Adelaide – North 7.3 294
6 Smithfield Adelaide – North 7.3 312
7 Elizabeth Park Adelaide – North 7.2 301
8 Smithfield Plains Adelaide – North 6.7 297
9 Elizabeth Vale Adelaide – North 6.6 307
10 Andrews Farm Adelaide – North 6.5 318

Source: CoreLogic

The above table is taken from the Corelogic report and provides an overview of the best rental yields in Adelaide.

The Adelaide rental market has experienced rises and falls throughout the pandemic but has remained relatively stable when compared to other states. Rental yields are now on the increase and this trend will likely continue once borders open.

According to SQM Research data, the gross rental yield in Adelaide is 3.9% for houses and 5.5% for units. The average median sale price* in Adelaide is currently $607,817 for houses. Prices remained relatively stable in 2020 but have begun to rise sharply this year in line with national trends.

For units, the average median sale price in Adelaide is currently $322,669, which represents a slight increase since early 2019.

*SQM Research updates their figures weekly.

Best rental yield suburbs near Perth

# Suburb Region Rental yield (%) Median rental value ($)
1 Cooloongup Perth – South West 7.1 356
2 Brookdale Perth – South East 6.9 350
3 Parmelia Perth – South West 6.9 327
4 Calista Perth – South West 6.8 313
5 Hillman Perth – South West 6.8 350
6 Orelia Perth – South West 6.8 331
7 Armadale Perth – South East 6.7 309
8 Medina Perth – South West 6.7 309
9 Camillo Perth – South East 6.6 323
10 Hilbert Perth – South East 6.4 381

Source: CoreLogic

The above table is taken from the Corelogic report and provides an overview of the best rental yields in Perth.

In 2020, the Perth rental market saw rental prices rise sharply by 8.2%. The downward trend that Perth had been experiencing since 2013 ended shortly before the pandemic began and rental prices have been on an upward trend ever since. This cyclical rebound in rents will likely see investors return and rental prices in Perth continuing to climb.

According to SQM Research data, the gross rental yield in Perth is 3.9% for houses and 5.4% for units. The average median sale price* in Perth is currently $700,900 for houses. 

For units, the average median sale price in Perth is currently $388,269, which is almost identical to average prices during the early pandemic.

*SQM Research updates their figures weekly.

Is it a good time to buy a property?

Best time to buy a property
Best time to buy a property

Despite skyrocketing prices, now may actually be a good time to buy. Interest rates are at record lows and are forecast to stay that way for the next few years. The cheaper loans on offer could help offset the higher sale prices. 

Interest rates aren’t the only reason to buy now. Prices are forecasted to rise even more in 2022 and international borders will soon be open, restoring the flow of migrants and international students to Australia. This will see empty apartments filling up, may cause rent prices to increase and increase the prices of units and starter homes.

Whether you are buying a home or an investment, now could be perfect timing. 

For more information on when to buy, see our time to buy guide. It provides general information, which may not account for COVID. You may be surprised to learn that buying during quieter times may work against you as stock may have dried up, but demand continues to push prices.

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