Your 2020 goal may be to take your first step into the property market or to grow your investment portfolio. Location is always a key factor to consider and we have provided a state-by-state overview to help you decide where to buy an investment property.
New South Wales
The most populated state in Australia provides many opportunities for investors. Sydney alone has recorded a 23.9 per cent change in dwelling values in the past five years and median values are over $850,000. Although dwelling and median values are on the rise in Sydney, gross rental yields are currently trending the lowest out of the major cities.
Sydney is always high on the list of property discussions, however investors shouldn’t rule out entering the regional New South Wales market. With increasing dwelling values, and positive population projections the smaller cities such as Newcastle and Penrith are proving to be smart choices.
Australian Capital Territory
As one of the most consistent property markets in the country, Canberra is set to continue to be steady in 2020. Dwelling values are at record heights and stamp duty deductions for investors make the Capital an appealing choice.
Despite the slight downturn that Melbourne experienced in 2019, things are starting to look on the up for 2020. Stabilised auction clearance rates, high rental yields and strong competition are helping to create a popular market.
Regional Victoria dwelling values are at their peak and investors shouldn’t rule out searching for a property outside of the CBD in popular areas such as Wyndham and Greater Geelong.
Often overlooked, our smallest state is boasting a strong property market for investors. Dwelling values are at their peak and Hobart is experiencing the most competitive rental market across the country, with low vacancy rates, high demand and rents up 5.8 per cent over the past 12 months.
To add further to Tasmania’s strong case as an investor’s choice, sub-regions such as Launceston and North East Tasmania are currently recording the highest annual change of dwelling values.
High rental yields and lower property prices makes South Australia a popular choice among investors. Adelaide dwelling values are at their peak with median values sitting at over $430,000.
Coming in at second place to Hobart, Adelaide is continuing its trend of producing a tight and competitive rental market.
Slowly but surely, Perth dwelling values are improving following their slump lasting over five years. While dwelling values are yet to reach their 2014 peak, Perth rental yields are trending positively by 1.9 per cent. On the outskirts of the capital, the City of Swan is also making its mark with one of the highest projections of population growth across the country.
For investors looking to buy in regional Western Australia, it’s important to be aware that the southern region is one of the lowest performing housing markets in Australia due to persistent drought and overall underperforming economic conditions.
Like Perth, Darwin dwelling values have been consistently falling over the past years. While they aren’t out of the woods yet, the good news for investors is that Darwin recorded its first subtle rise of 0.1 per cent in January 2020.
Although Darwin’s housing market conditions are weak overall, the city features high rental yields as housing values are falling at a higher percentage than rental rates.
Investors searching for a property in Queensland commonly look to the capital and major cities. Median values in Brisbane are almost at the $500,000 mark, while sub-regions such as the Gold Coast and Sunshine Coast are recording positive dwelling value increases and strong projections for population growth.
The broader outback regions of Queensland continue to be one of the weakest housing markets due to persistent drought and weak economic conditions.
Most properties across Australia, both new and old, have depreciation deductions available. BMT found residential property investors an average of almost $9,000 in first full financial year deductions last financial year, so it’s worth speaking with a specialist Quantity Surveyor to help inform your investment decisions.
Contact our specialist team on 1300 728 726 or Request A Quote.