Regional Queensland leads in investment hotspots, new research reveals

New analysis has spotlighted Australian suburbs and towns with rental yields above five percent, indicating that investors looking for affordability, cash flow, and capital growth potential should turn their gaze towards major regional areas, especially in Queensland. The Hotspotting National Top 10 Positive Cashflow Hotspots report, applying multiple key criteria, uncovers locations across the nation that promise not only high rental yields but also strong economic diversity, vibrant rental markets, and significant capital growth prospects. Queensland has emerged victorious, securing half of the top 10 positions.

Terry Ryder, Director at Hotspotting, emphasized the value of regional areas, particularly Queensland, as prime locations for astute investors. He noted, “Cash flow has become increasingly important over the past two years, given the much higher mortgage repayments in play.” However, he advised against making investment decisions based solely on rental yields, stressing the importance of capital growth prospects driven by booming local economies.

Tim Graham, Hotspotting’s General Manager, highlighted regional Queensland’s prominence in the top 10 due to its affordability and a range of major infrastructure projects in progress. He pointed out the economic diversification in places like Gladstone and Rockhampton, noting that such diversification had led to more stable property markets and robust investment opportunities.

The report’s findings include notable entries such as West Tamworth in regional New South Wales, with a median house price of $340,000, and Yorkeys Knob in regional Queensland, featuring a median house price of $325,000 for units. It underscored Tamworth’s emerging status within a renewable energy precinct and the diverse economic background that supports its attractiveness to new residents seeking affordable lifestyle options.

Gladstone, according to Graham, has evolved significantly over the past decade, moving away from a heavy reliance on the resources sector, hence witnessing a drop in vacancy rates and a rise in property prices. The forecast indicates that Gladstone’s population could surge by over 60% from 2021 to 2041, presenting an intriguing prospect for investors.

Other locations such as Bundaberg North and Berserker in Rockhampton showcase the potential for substantial capital growth, with ongoing billion-dollar projects and very affordable median house prices attracting both migrants and investors.

In North Adelaide, the suburb of Elizabeth Downs shows promising signs of growth, buoyed by significant investments in technology, equipment, and infrastructure at the RAAF base in Edinburgh. The report also draws attention to areas like Orelia in Kwinana, Perth, and Withers in Bunbury, Regional WA, where affordable property prices coupled with high rental yields and major infrastructure projects present lucrative opportunities for investment.

The analysis extends to the unit market, highlighting Bowen Hills in Brisbane and Yorkeys Knob in regional Queensland as regions experiencing strong demand, affordability, and potential for growth, making them attractive to both first home buyers and investors.