According to InvestorKit’s latest whitepaper, four SA3 regions out of an analysed 20 have property that can be purchased for under $500,000, and are pegged for strong future growth.
The selected regions by InvestorKit include Bundaberg, Townsville, Rockhampton, and South Cairns.
InvestorKit Head of Research Arjun Paliwal said there are still areas where owner-occupiers and investors can buy property at affordable entry-level prices and experience long-term capital gains.
“Not only do these areas have affordable house prices, but they also show the potential for further capital growth, healthy rental yields and expected rental growth in the short term due to the high pressure in their sale and rental markets,” Mr Paliwal said.
“These locations also stand out because of internal migration towards affordability and lifestyle alongside their thriving local economies due to industry diversification and infrastructure investments.”
The four regions below achieved the highest Market Performance Score (out of 5). A higher score correlates with a strong economy and a good time to invest in the market.
Bundaberg
Market performing score: 4.2
Median house price: $445,000
Over the past 10 years, Bundaberg’s house prices have increased 50.8%.
Mr Paliwal said the region stood out as one of the top 10 performers in 2022 despite consecutive interest rate rises clouding market sentiment.
“There is more room for growth, as the 10-year average is still under 25-year averages for annual growth,” he said.
Vacancy rates in Bundaberg are currently at 0.6%, while investors can expect rental yields of 5.3% given the tight conditions.
Rockhampton
Market performing score: 4.8
Median house price: $385,000
Over the last 12 months, Rockhampton has seen house prices rise by 5.5%.
Meanwhile, the median house price has increased by 16.7% over the past decade.
The region’s rental market has been under pressure over recent years, with the average number of rental listings decreasing by 3.8%. Vacancy rates remain below 1%.
Mr Paliwal expects more robust growth to come considering its strengthening local economy and increasing market pressure.
Townsville
Market performing score: 5
Median house price: $400,000
Townsville achieved the highest market performing score, with house prices increasing by a total of 9.6% over the last 12 months.
In terms of decade-average growth, median prices in the region only recorded an 8.7% gain, which is far below its long-term average growth.
Vacancy rates remain below 1% despite a slight increase (0.3%) in listings over the past year. Investors can expect yields of around 5%.
“What can’t be underestimated here is the sheer level of shift in the city’s local economies - from one of the worst in 2016 to now one of the nation’s best in unemployment levels, spending and more,” Mr Paliwal said.
“Prices and rents in our opinion remain heavily undervalued here, irrespective of what one may think of with outgoings, weather and more.”
South Cairns
Market performing score: 4.7
Median house price: $482,500
Cairns South, which includes areas such as Woree, White Rock, Mount Sheridan, and Bayview Heights, has seen house prices grow by 12.2% over the last year.
The past decade has seen a balanced increase of 47.7% in house prices in the area, still below its long-term averages, hinting at room for growth.
Vacancy rates in Cairns South are at crisis levels, currently at 0.4%. However, the upward pressure within the rental market has resulted in a strong rise in median rents over the past 15 months.
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Buying a home or looking to refinance? The table below features home loans with some of the lowest interest rates on the market for owner occupiers.
| Lender | Home Loan | Interest Rate | Comparison Rate* | Monthly Repayment | Repayment type | Rate Type | Offset | Redraw | Ongoing Fees | Upfront Fees | Max LVR | Lump Sum Repayment | Additional Repayments | Split Loan Option | Tags | Features | Link | Compare | Promoted Product | Disclosure |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
6.04% p.a. | 6.06% p.a. | $3,011 | Principal & Interest | Variable | $0 | $530 | 90% | 4.6 Star Customer Ratings |
| Promoted | Disclosure | |||||||||
5.99% p.a. | 5.90% p.a. | $2,995 | Principal & Interest | Variable | $0 | $0 | 80% | Apply in minutes |
| Promoted | Disclosure | |||||||||
6.09% p.a. | 6.11% p.a. | $3,027 | Principal & Interest | Variable | $0 | $250 | 60% |
| Promoted | Disclosure | ||||||||||
5.69% p.a. | 6.16% p.a. | $2,899 | Principal & Interest | Fixed | $0 | $530 | 90% |
| Promoted | Disclosure |
Image by Steve Davison via Unsplash
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