There are a lot of contributing factors that make a good investment property, such as high rental returns or buying in an in-demand location where tenant activity is up.
If you are an investor, or looking to invest, it is wise to search in the suburbs where tenants are most active. Generally speaking, when suburbs are popular among renters, landlords have an easier time leasing out their property - in fact, you might even have the luxury of choosing out of multiple applicants.
Another benefit is that rental returns are likely to be higher in suburbs where tenants are competing.
To help you decide where to invest, we have looked at the 10 Perth suburbs which have experienced the biggest growth in leasing activity during the last year.
Median house price: $880,000
Median unit price: $500,000
Taking out the top rental hotspot is North Beach. In the year to March 2019, North Beach’s leasing activity increased 28.6 per cent, while leasing activity in the overall Perth region declined eight per cent. Tenants in the area are paying a weekly median rent price of $520. North Beach is a coastal northern suburb of Perth with huge investment potential, drawing in tenants to its attractive lifestyle appeal.
Median house price: $1.225 million
Salter Point comes in at number two on the list, with leasing activity having increased 25 per cent over the last year. Close to the Perth CBD and public transport, Salter Point offers tenants the opportunity to live in one of Perth’s affluent suburbs, with stunning river and city views.
Salter Point presents a classy lifestyle and houses in the area are generally more expensive. Tenants renting in Salter Point are paying a median rent of $498 a week.
Median house price: $430,000
Median unit price: $299,000
If you are considering buying an investment property north of the river, consider Bennett Springs. Like Salter Point, tenant activity is strong in the area, having increased 25 per cent over the last 12 months.
Bennett Springs is an affordable area to buy an investment house, but it will still give you a higher rental return than the Perth region, with tenant’s paying a median weekly rent of $400. This equates to a rental yield of 4.8 per cent which is the highest on this list.
Median house price: $570,000
Median unit price: $371,650
Next on the list is Mundaring, where tenants pay a weekly median rent price of $370. Despite the suburb being 45 minutes from Perth, it proved popular with tenants in the year to March 2019, with leasing activity up 24.1 per cent compared to the year before.
Situated away from the hustle and bustle of city living, Mundaring holds great appeal for families thanks to its wide-open spaces and beautiful parklands.
Median house price: $1 million
Median unit price: $675,000
Daglish is a small western suburb of Perth with lots of investment potential. Located within the City of Subiaco, Daglish is only four kilometres from Perth CBD and is well served by public transport making it highly desirable among tenants. Daglish saw leasing activity increase 23.5 per cent during the last year, suggesting now is a good time to buy an investment house in the area.
If you are interested in buying an investment property in Daglish, you can expect a median weekly rental return of $460.
Median house price: $361,000
Beechboro is a large developed suburb which has been subdivided with many estates. Beechboro ticks all the boxes from an investment perspective, with leasing activity increasing 20.8 per cent while the average rental yield in the area is 4.6 per cent.
The suburb has a median rent price of $318 a week, making it an affordable option for tenants. If you are looking to invest in a suburb with development potential and higher density, then consider Beechboro.
Median house price: $652,500
Median unit price: $300,000
Coming in at number seven on the list is Guildford, which saw leasing activity increase 20.8 per cent during the last year. Guildford is situated on the Swan River in Perth’s east, and is best known for its colonial architecture and rich history. Tenants living in Guildford pay a weekly median rent of $380.
The suburb holds plenty of appeal for tenants, thanks to its relaxing lifestyle, peaceful charm and hilly landscape with plenty of sight-seeing activities close by like the Swan Valley wine region.
Median house price: $1.25 million
Median unit price: $500,000
West Leederville saw a 17.7 per cent increase in tenant activity during the year to March 2019. Landlords with investment properties in West Leederville are charging a median weekly rent price of $590. With Leederville, Subiaco and Perth City all close by, West Leederville is a popular choice for tenants, straddling the balance of suburban living in an urban environment to great effect.
Locally, there is West Leederville shopping centre, the train station and West Leederville Primary school all close by, whilst everything else tenants need can be found in neighbouring Leederville.
Median house price: $780,000
Median unit price: $432,500
The suburb of Perth is another rental hotspot to consider if you are looking to purchase an investment property. During the year to March 2019, leasing activity rose 16.7 per cent. Many tenants who look for a rental are attracted to the suburb of Perth for its convenience and city lifestyle. If you are considering buying an investment property in Perth, you will be looking to charge around $450 a week for rent.
Median house price: $735,000
Median unit price: $320,000
Rounding out the list of Perth’s rental hotspots is Coogee, which saw leasing activity increase 16.3 per cent over the last year. Coogee is located just south of Fremantle and has recently undergone major developments. New houses in the area boast amazing views of Coogee beach and the marina. Investors are charging a median rent price of $500 a week for their investment houses which is $150 per week more than the overall Perth average.
Thinking about investing in property? P&N Bank have competitive interest rates for investors, including interest only repayment options and redraw facilities to give you the freedom you need. P&N's Mobile Lending Specialists can visit you at home or work, night or day, weekday or weekend.
Visit our investment loan page to find out more.
Article first appeared on reiwa.com.au.
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