20 best investment locations for buyers with a $100k deposit

Only house markets were selected, as freestanding houses are likely to give investors better long-term capital gains than units.

Additionally, they carved out a slim set of criteria that each area must meet to be considered a good investment.

Areas were excluded if they fell within a statistical area where the median price for a three-bedroom house was $1 million or above, with researchers looking for locations where the vacancy rate sat at 1.5 per cent or below over the course of 2021, with yields of 3 per cent or above.

The area’s share of owner-occupiers had to fall between 65 per cent and 90 per cent and also be a location where the weekly rent had increased by at least 5 per cent over the past 12 months.

Finally, the number of building approvals over the previous 15 months must have been less than 2 per cent of the total existing housing stock to be considered.

The ability to buy with a $100,000 deposit was based on the understanding that a buyer would be comfortable putting down a 10 per cent deposit and paying lenders mortgage insurance in order to get into the market sooner.

According to those specifications, these are Australia’s top 20 places to buy a three-bedroom house with a 10 per cent deposit, based on their average price:

1. Safety Beach, NSW, $765,000
2. Tyabb, Vic, $715,000
3. Valley Heights, NSW, $736,200
4. Belgrave, Vic, $755,000
5. Millthorpe, NSW, $637,000
6. Tecoma, Vic, $815,000
7. Kariong, NSW, $852,676
8. Wickham, NSW, $760,000
9. Medowie, NSW, $700,000
10. Sandhurst, Vic, $950,000
11. Reedy Creek, Qld, $988,000
12. Lower Beechmont, NSW, $610,000
13. Riverside, Tas, $501,000
14. Ropes Crossing, NSW, $795,000
15. Park Grove, Tas, $460,000
16. Tarago, NSW, $530,000
17. Gilston, Qld, $850,000
18. Flagstaff Hill, SA, $627,500
19. Wellington Point, Qld, $756,000
20. Robina, Qld, $901,500

Current yields in all of these locations have proven to be robust over the past year. The lowest was Tecoma to the east of Melbourne, where owners still reported yields of 2.9 per cent. On the higher end, Tarago offered yields of 4.9 per cent, with Tasmanian locations Park Grove and Riverside reporting a healthy 4.6 per cent.

Eventus Financial chief executive Alex Veljancevski said that while many investors might be put off by the market’s recent rise, this data showed there was still plenty of opportunity for those willing to think outside the box.

“If you want to put down a 20 per cent deposit on a house close to the centre of a major capital city, you’ll need much more than a $100,000 deposit,” he acknowledged.

“But if you’re willing to be open-minded about your loan-to-value ratio and location, you can definitely buy a good investment property with a $100,000 deposit.”