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Still affordable opportunities for investors, as prices rise

Despite property prices rising substantially since 2020, there are still opportunities for investors to find good quality, affordable locations.

Adviseable Property Buyer Kate Hill said the cost-of-living crunch and the burden of higher interest rates have forced many prospective purchasers to tighten their belts.

“Those active in the market face strong competition, though, with a lack of supply and a rapidly growing pool of buyers,” Ms Hill said.

“It’s tough out there at the moment, with the shallow pool of available properties for sale attracting a lot of attention.”

Ms Hill said there were still a number of viable investment locations across the country for less than $550,000, despite prices increasing nationally in the past six months.

She said Armadale, in Western Australia, was a suburb that showed a lot of potential and is affordably priced.

“Sitting some 30km southeast of Perth, charming Armadale offers a strong sense of community, amenity, and connection, all for an almost unbelievable price,” she said.

“The median house price of $338,500 has already risen by 12.8 per cent in the past year, while the median unit price of $290,000 is also up 7.8 per cent.

 “Investors can achieve solid gross yields right from the get-go, with the median house rent of $400 per week – up 14.3 per cent year-on-year – offering 6.1 per cent.”

According to Ms Hill, Darling Heights in Toowoomba, Queensland, has an abundance of natural beauty, elevated vistas, and a relaxed, peaceful vibe to boot. 

“Far less tempered is the interest of investors, who see Darling Heights as a prime location to snap up a rental property – and it’s all thanks to the bustling University of Southern Queensland campus,” she said. 

“The median house price here has surged by 19.4 per cent in the past year to hit $513,500 while the median unit price is $315,000.

“As well as the uni campus, Darling Heights is also just a stone’s throw away from the CBD. Its youthful vibe makes it a possible destination for first-home buyers, too.”

Ms Hill said Delacombe in Ballarat, Victoria, is a rapidly growing suburb on the southwestern fringe and is in the midst of a transformation thanks to an ambitious $50 million masterplan developed by the State Government.

“As part of the Big Housing Build Scheme, more than 100 new modern and energy efficient dwellings will be built, sparking the construction of high-quality streets and open public spaces,” she said. 

“Government agency Homes Victoria intends the masterplan to lay the groundwork for the long-term development of the suburb, benefiting current and future homeowners.” 

She said the relatively affordable price tag will see first-home buyers, young families, and investors increasingly prioritise this area.

Ms Hill said with an abundance of green space, safe streets, good amenities and plenty of parks, it’s no surprise Adelaide families favour Munno Para in the city’s northern suburbs. 

“Despite the appeal, the median house price is just $390,000 – although it has leapt by 15.4 per cent in the past 12 months,” she said. 

“First-home buyers are increasingly flocking to Munno Para because of its sense of community, affordable price tag and a relatively convenient proximity to the CBD via good road connections. 

“Investors are sitting up and paying attention, too, with a median house rent of $420 per week offering a gross 5.6 per cent yield.”

While Crestmead in Logan, Queensland is set to see its population balloon from 350,000 currently to 500,000 by 2034. 

“The suburb is favoured by families, with parks, greenspace, leafy streets, and a handful of good schools, including St Francis College, Ms Hill said. 

“It also boasts exceptional connectivity to both Brisbane and the Gold Coast thanks to its proximity to the Logan Motorway and Gateway Motorway interchanges.

“The median house price of $524,000 has risen by 6.9 per cent in the past year. Despite sharp growth over recent years – the median was just $325,000 in July 2020 – it remains undervalued given its appealing attributes.” 

She said the median house rent of $470 per week reflects this popularity, with a staggering 14.6 per cent increase in the past 12 months. 

“That delivers investors a 4.6 per cent gross yield,” Ms Hill said

“Among some exciting infrastructure projects is the mega Crestmead Logistics Estate – a $1.5 billion project delivering 650,000sq m warehousing, business and manufacturing space.”

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Rowan Crosby

Rowan Crosby is a senior journalist at Elite Agent specialising in finance and real estate.