Strong gains in regional Victoria
New REIV data shows homes in regional Victoria produced some of the state’s strongest returns in the last three months of 2016.
Two-bedroom houses in regional Victoria were among the best performing for investors, delivering a gross rental yield of 5.3 per cent in the December quarter, higher than any other property type in metropolitan Melbourne.
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Towns in the Gippsland area produced some of the state’s highest returns for two-bedroom homes, with Morwell leading the way with a gross rental yield of 8.1 per cent.
This was followed by similar sized homes in Moe, Sale and Traralgon. All delivered returns of at least 7 per cent for investors.
Strong returns for the same property type were also seen in Mildura, Wendouree and the Geelong suburb of Norlane, at 6.6 per cent, 5.9 per cent and 5.8 per cent respectively.
In comparison, in the sought-after Melbourne suburb of Hawthorn, the gross rental yield was just 2 per cent on a two-bedroom house. Despite a weekly median rental of $500, the significant median price of $1.3 million held down the yield.
Three-bedroom homes also delivered solid returns for investors across the state at 4.8 per cent in the December quarter. Red Cliffs, near Mildura, recorded one of the highest returns for this property type, at 6.7 per cent.
Other towns recording strong yields for three-bedroom homes included Bairnsdale, at 6.3 per cent; Mooroopna, at 6.2 per cent; Tatura, at 6.2 per cent; and Benalla, at 6.1 per cent.