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ISCOVER
Staff Reporter
Low interest rates and rising rents should encourage aspiring property investors to take their first step onto the property ladder, according to a leading brokerage.
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Reviewing suburb statistics commissioned from RPData, Aussie executive chairman John Symond revealed there are at least half a dozen suburbs in each capital city where gross rental yields are greater than the cost to repay the mortgage.
“Everyday Australians can seriously consider moving into the investment property market and having the rent cover the mortgage. In effect they could ‘set and forget’ an investment plan for their future,” said Mr Symond.
“Both fixed rates and variable rates are the lowest they have been in years; interest rates can be below five per cent. Housing prices in some areas are historically low but are starting to move back up and now investors can earn rental yields between five and 10 per cent in some areas, and as high as a whopping 16 per cent in one area of Darwin.
“Properties with high rental yields are of benefit to those investors who have less disposable income that they can use to pay the property's associated bills. If they are earning higher gross rental yields, they can afford to own it in the first place, where otherwise they might not be able to,” he said.
The best suburb in the country for investors to consider, according to Aussie, is Bellamack in Darwin, with a 16.9 per cent rental yield coupled with an even bigger 24 per cent increase in rents in the last 12 months.
RP Data’s senior research analyst Cameron Kusher noted that the figures only looked at properties under half a million dollars.
“This research is primarily looking at those areas where the ordinary Australian on an average income may be able to afford to enter the investment market and, as such, we looked at properties that were under $500,000, and which earned high gross rental yields,” he said.
