Top 10 markets for yield and capital growth in WA
New data has pinpointed the top 10 investment locations that are seeing solid yields and capital growth prospects in one recovering property market.
Data provided by the Real Estate Institute of Western Australia (REIWA) has found Greenfields to be the number one location where investors can find a rental yield and capital growth well above the Greater Perth average.
Speaking to Smart Property Investment, Lisa Joyce, deputy president of REIWA, identified Greenfields as a “standout” suburb due to its relatively low median house price of $275,000, a rental yield of 5.4 per cent and experiencing growth in its medial sales price of 4.6 per cent.
In comparison, Greater Perth’s median house price sits at $470,000, has a rental yield of 3.8 per cent and saw its median house price shrink by 2 per cent.
“Greenfields is a suburb on the fringe of Mandura, which is a city outside the metropolitan area, and it has good infrastructure, shopping centres, schools, golf course; so there are amenities surrounding that suburb,” Ms Joyce said.
“So there are all the sort of things that tenants look for – employment opportunities, recreational facilities, cycle paths, park lands – those areas that are attractive to all of us really when we consider where we ideally would like to live, so Greenfields is desirable for those reasons.”
Over the Greater Perth area, Ms Joyce predicted that the currently shrinking average days to lease will shrink even further.
“What was experienced in Perth is a dramatic contraction in the vacancy rate, so up around that 5.3 [per cent] mark… for a long time. It was the 31st of December that dropped quite rapidly to 2.8 per cent. It then declined down to 2.5 per cent and it stayed fairly consistently or fairly steady at 2.5 per cent,” she said.
“That’s the lowest vacancy rate we’ve experienced in Perth in many years, so I would say that we will see a further reduction in average days to lease across the board.”
Ms Joyce said this statistics highlighted the strength of the rental market in Perth, and labelled it as a “very positive aspect of our property market”.
“Investors are looking very closely at what’s going on. We’re seeing modest growth in rents, which is very positive, but a considerable decline in vacancy rate, and as that supply of rental properties continues to be absorbed, we may start to see some pressure on demand, and then it’ll be interesting how that plays out in the rental markets.
“Certainly positive news for investors.”
According to the Real Estate Institute of Western Australia, the top 10 capital cities for both rental yields and median sales price growth over the last year to April 2019 are:
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Suburb
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Median sale price |
Median weekly rent price |
Rental yield |
Average days to lease |
Median sales price growth for the last 12 months |
|
1. Greenfields |
$275,000 |
$280 |
5.3% |
42 |
4.6% |
|
2. Lakelands |
$380,000 |
$338 |
4.6% |
35 |
4.8% |
|
3. Two Rocks |
$357,000 |
$310 |
4.5% |
51 |
5.9% |
|
4. Caversham |
$440,000 |
$370 |
4.4% |
35 |
1.2% |
|
5. Roleystone |
$529,000 |
$440 |
4.3% |
35 |
1.5% |
|
6. Singleton |
$425,000 |
$350 |
4.3% |
32 |
5.6% |
|
7. Munster |
$525,000 |
$430 |
4.3% |
39 |
5.0% |
|
8. Falcon |
$365,000 |
$295 |
4.2% |
45 |
4.3% |
|
9. Lynwood |
$406,888 |
$328 |
4.2% |
46 |
3.3% |
|
10. Edgewater |
$511,000 |
$410 |
4.2% |
41 |
3.1% |
|
Greater Perth |
$490,000 |
$360 |
3.8% |
43 |
-2.0%
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