RP Data has identified 45 suburbs where the average rental return provides positive cash flow, enabling investors to enjoy a net gain after all costs are accounted for.
The Cash Flow Positive Report released this week named Queensland as having the greatest number, accounting for 38% of all the suburbs named in the report. NSW came a close second with 31%.
The resurgence in Australia's rural areas continues to have a positive effect for new and existing property owners, with rural townships accounting for a third of the greatest portion of positively geared suburbs.
Inner city properties captured just 16%, and these were only found in Darwin, Canberra and Sydney.
"With confidence low due to high inflation, property value declines in specific areas and money lost on the share market, many buyers are likely to now turn back to the typical bricks and mortar-type investment strategies," said Cameron Kusher, author of the Cash Flow Positive Property Report.
"More and more investors will be looking to purchase cash flow positive properties in order to reap the benefits of a return from their property and to also capitalise future property value growth. With vacancy rates now the lowest they have been in years, coupled with strong rental growth and minimal property value growth, we anticipate that more and more properties will be moving into cash flow positive territory over the coming years."
The following is just a sample of the 45 suburbs named in the report.
Forrest - is an inner city suburb of Canberra, situated approximately 4km from the Canberra CBD. Forrest offers an inner city unit location which is achieving particularly strong rental demand because of its location which is close to both Parliament House and the CBD. Canberra is currently recording the nation's second best average gross rental yields, fuelled by strong rental demand largely from the public sector.
Chipping Norton - is a suburb of western Sydney situated approximately 27km from the Sydney CBD. The suburb's unit offering is dominated by older two and three storey walk-up units which generally have an affordable price tag. The suburb has a large park within and its own lake. The suburb sits adjacent to Liverpool, where there is an abundance of retail amenities within the local Westfield shopping centre. The suburb also enjoys the benefit of nearby train stations at Liverpool and Warwick Farm, providing linkages to the Sydney CBD.
Greenwich - is an inner city suburb of Sydney situated 4km northwest of the CBD. The suburb enjoys an elevated harbour-front position which affords many properties excellent views. The unit offering within the suburb is dominated by older-style walk-up units which are likely to have significant internal renovation potential. The suburb has its own train station, and an abundance of retail, dining and social amenities can be found in the nearby suburbs of North Sydney and Crows Nest. These areas also house major employment nodes.
Dysart - is a Central Queensland mining town which serves as a service centre for the nearby Saraji and Norwich Park Coal Mines. A significant increase in demand for coal in recent years has seen the demand for workers in the region increase exponentially. As a result, there has been a significant increase in demand for housing and new supply has been unable to keep up, therefore resulting in a significant increase in rental rates.
South Hedland - is a suburb of the town of Port Hedland. Port Hedland is Australia's highest tonnage port and the largest town in Western Australia's Pilbara region. The recent huge surge in demand for resources from the Pilbara region has seen strong growth in demand for housing, as more and more workers move to the area for jobs which are closely aligned to the mining and resources sector. This influx of workers has resulted in strong growth in house prices and exceptionally strong rental rates.
For more information on Positive Cash Flow properties contact one of our approved advisors.
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