7 top Australian suburbs for rentvestment

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6 min readDue to Australia’s soaring house prices, we’re seeing a growing trend in young Aussies turning to rentvesting to get into the property market.

Mozo property expert Steve Jovcevski says, ‘Young people are finding it increasingly unattainable to purchase their own home in the city they live in’.

In fact, recent research by Westpac shows 13 per cent of first-time buyers are now opting to rentvest instead of buying an owner-occupied home.

According to research by financial comparison site Mozo, rentvesting now accounts for over 30 per cent of all property investment in Australia, a whopping $200 billion worth of loans.

‘Ease of transportation, minimal commute, greater job opportunities and stellar education, healthcare and culture are just a few reasons people are having their cake and eating it too. They can enjoy the benefits of a big city while making savvy property investments that won’t break the bank’, Jovcevski explains.

A recent study by Westpac profiling rentvestors showed that 41 per cent of the people surveyed would be open to rentvesting, with Sydneysiders most keen to adopt it (47 per cent).

With so many Australians eager to take on this investment strategy, the experts at Mozo have identified seven of the best suburbs around the country ripe for rentvestment.

To make the grade suburbs had to have a median house price (MHP) below $600k, and appealing vacancy rates, rental yields, price changes and housing supply.

‘When looking for an investment property, there are a few key factors to assess. Vacancy rates will provide you with a good idea of rental demand. The lower the better.’, Jovcevski suggests.

‘Be sure to crunch the numbers on your mortgage versus the rental returns in the suburb you are looking to invest in, as ideally, the rent will cover the majority of the mortgage’. Jovcevski advises.

To help you assess the viability of rentvesting in one of these shortlisted suburbs we’ve included MHP, vacancy rates, distance from the CBD, average home deposit, monthly mortgage repayments (based on a 30 year loan with a 20 per cent deposit using average principal and interest investor rates on Mozo’s database of 4.87%) and insights on what it’s like to live there from homely locals.

The best Australian suburbs for rentvesting under $600k

Sunbury, VIC

Distance to CBD: 40km from Melbourne

MHP: $418,000

Vacancy rate: 0.9%

Average deposit: $83,600

Monthly mortgage repayments: $1,769

The word on the street:

‘The best thing about Sunbury is that everything keeps on improving- more shops, more housing, better medical facilities and transport. I love Sunbury and have lived here for 11 years. I hope to live here for many more.’- TheMac

‘We purchased a block and built due to the great land prices compared to Melton, Werribee etc. and the traffic isn’t that bad in the morning compared to the West Gate and Monash. Sunbury is a fantastic town with a great country feel, unlike most new instant suburbs.’- Michael

For sale: 14 Gowrie Court, Sunbury, VIC

Liverpool, NSW

Distance to CBD: 40km from Sydney

Median unit price: $448,000

Vacancy rate: 3.7%

Average deposit: $89,600

Monthly mortgage repayments: $1,896

The word on the street:

‘Liverpool is the epitome of multiculturalism in Sydney. It is a melting pot where different cultures live next to each other. It is quite a big city with many businesses…There is a cinema and a massive Westfield for all your shopping needs.’- RubyShoes

‘The next Parramatta…With pubs, nightclubs, endless shopping, train station, T-way, tafe, public and private hospitals, countless medical centres and parks, schools and daycares…I recommend Liverpool CBD for singles, couples and growing families.’- Urbanangel87

For sale: 12/21-23 Nagle Street, Liverpool, NSW

Trevallyn, TAS

Distance to CBD: 3km from Launceston

MHP: $324,000

Vacancy rate: 1%

Average deposit: $64,800

Monthly mortgage repayments: $1,370

The word on the street:

‘Private, peaceful and very trendy…Residents take advantage of the amazing views, access to the gorge, child care and primary school, public transport and a small shopping precinct with supermarket, newsagency, pharmacy, deli and cafe. As a Trevallyn local, I believe it’s great place to raise a family or invest.’- Joel Sloane

‘Close to everyday necessities…Everyone knows everyone here. Being walking distance to schools, grocer, delicatessen, local newsagent, bakery, chemist, doctors and the cafe. Trevallyn has it all.’  – Kathrun Ord 

For sale:  2/25 Floreat Crescent, Trevallyn, TAS

Brooklyn Park, SA

Distance to CBD: 5km from Adelaide

MHP: $504,000

Vacancy rate: 1.2%

Average deposit: $100,800

Monthly mortgage repayments: $2,133

The word on the street:

‘Brooklyn Park is great city fringe suburb with loads of potential and is very popular. There are lots of local schools, shops and public transport routes surrounding it.’- Michael Walkden

‘I’ve lived in Brooklyn Park for the last 3 years and would say it is a good value for money area that is 5 mins from city and 5 mins from beach with good shopping options, great for public transport’- Sayvar44

For sale:  5/13 Jeffrey Street, Brooklyn Park, SA

Tewantin, QLD

Distance to CBD: 9km from Noosa city centre

MHP: $517,000

Vacancy rate: 1.2%

Average deposit: $103,400

Monthly mortgage repayments: $2,188

The word on the street:

‘What I love about Tewantin is the friendly people in the township. The shopping area has great character and a good mix of shops for all your needs. The Noosa Harbour marina just a short walk away is the only marina in town and there are some good cafes and restaurants here whilst enjoying the cool breezes and river views.’- Richlocke

‘Tewantin is a small town set back from the holiday destinations of Noosa and surrounding areas. Many people who work or own businesses in the Noosa area live in Tewantin. The town is a mixture of old and new with more and more growth as the Sunshine Coast develops. Real estate prices are reasonable and rents are also reasonable.’ –Clickwriter

For sale: 12/58 Furness Drive, Tewantin, QLD

Scullin, ACT

Distance to CBD: 12km from Canberra

MHP: $540,000

Vacancy rate: 0.7%

Average deposit: $108,000

Monthly mortgage repayments: $2,285

The word on the street:

‘With large block sizes, quiet peaceful living and proximity to both the Belconnen city & Canberra CBD areas, Scullin is a great choice of place to buy or rent for all age groups. Public transport abounds as do all other amenities’- MM1

‘The local shops in Hawker are able to provide all of the daily necessities. Also Westfield Belconnen is only a short drive away. It is a family-friendly area with plenty of parkland to enjoy. It is a very sought after area and you have act quickly to buy’- BillieU67

Image: LJ Hooker Kippax

Madeley, WA

Distance to CBD: 20km from Perth

MHP: $580,000

Vacancy rate: 1.1%

Average deposit: $116,000

Monthly mortgage repayments: $2,454

The word on the street:

‘One of the best suburbs in Perth. Period. I honestly cannot fault this suburb, it has everything, shopping, and unbelievable convenience to Swan Valley, the city, and Hillarys (boat harbour).’- PomsInPerth

‘Fantastic for families and close to so many amenities. Overall a great suburb, friendly people and affordable’-Olivedale 

Image: eview group

Considering becoming a rentvestor? Check out our list of pros and cons and these hotspots for Melbourne Millennial home buyers.

Happy house hunting!

The Homely Team

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Larissa Gardner
Larissa Gardner is the Marketing Manager at arguably Australia’s best looking real estate website homely.com.au. With a superb devotion to product innovation, user-centred design and innovative marketing platforms for real estate agents, homely.com.au helps millions of Australians find their next home.

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