Where did you find the best rental yields in 2014?
January 1, 2015 / Written by Rich Harvey
As we continue looking back on the year that was, let's now see where the best rental yields were found across Sydney and the wider state. While not everyone wants positively geared property, those that do will be always on the lookout for areas that provide high yields. And now that the results are in from this year, we can take a look at the top performers.
Who had the highest rental yield?
A high rental yield means being able to charge rent that is proportionately high compared to the price you pay for your property. This also increases the likelihood of the your Sydney investment property being profitable. According to the RP Data Best of the Best report, the place where this was most likely right across New South Wales was Warragamba, in Wollondilly. With a median home price of $305,000 and a median rent charged of $370 per week, this makes for a rental yield of 6.3 per cent.
Just over an hour out of Sydney, the Wyong area was the other top performer. The remaining nine suburbs in the top ten for rental yields were all concentrated in this region, with yield figures ranging from 5.5 to 6 per cent. This price drive may be due to the tight rental market, with SQM Research data showing vacancy rates of only 0.7 per cent.
However, just finding the suburb doesn't mean you will automatically get an investment property with great yields. You need to make sure you choose real estate that has the right price for your budget that will get rent to match up with your home loan repayments. Using a buyers agent is a surefire way of getting in the know. We have detailed insight into markets and will get you ahead on the property ladder.
But what about capital gains?
Of course, rental yields are not the only factor that makes a great investment property in Sydney. The growth of a home in value is also important, as it lets you sell down the line for a tidy profit. The Best of the Best report also collated these figures, showing the areas of Sydney that saw the highest change in median values over the last five years.
The top performer here was Burwood Heights, which saw median home values rise an astonishing 104.2 per cent - effectively doubling in value.
Picking the areas where this growth will occur is not easy, but by speaking to a buyers agent, you give yourself a great chance of finding the next suburb in this vein.