New research from The Female Investor has identified five affordable locations across Australia that offer growth prospects for those considering rentvest.
Female Investor co-author Kate Hill says rentvesting is a viable option for many first-time homebuyers who want to enter the market without compromising their ideal location to live.
"Renting continues to be more affordable than buying in coveted pockets of big cities, where purchase prices can easily run into the millions of dollars and where many young people want to live ", she said.
"However, being a long-term tenant without putting your money to work somehow has significant ramifications on your financial future and can potentially cause difficulty in retirement."
Nicola McDougall, co-author of Female Investor and member of Property Investment Professionals of Australia, said that despite price gains over the past year, many Australians are actually encouraged to participate in the market real estate through rentvesting, as many locations have remained affordable.
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"Just as many young people have moved to more affordable areas in recent years, rentvesting has become a popular strategy for those who want to buy property but still want to continue living in an expensive real estate city like Sydney or Melbourne,” she said.
Here are five of the best places in Australia for Australians considering renting a jacket:
Casey City Council (Melbourne)
Suburb: Cranbourne – $657,000
Rental vacancy rate: 1%
Ms Hill said one of the factors making Casey Town Council a viable place to invest in is strong economic fundamentals.
"The local industries are diverse, which means that the region is not dependent on a single industry, therefore the region is less volatile, which keeps employment rates very stable."
Casey City Council's population growth rate has exceeded that of other fast-growing outer Melbourne municipalities.
"In fact, it's growing at more than twice the rate of the national average," Ms Hill said.
Town of Onkaparinga (Adelaide)
Suburb: Morphett Vale – $430,000
Rental vacancy rate: 0.1%
The town of Onkaparinga is considered an attractive seaside location, thanks to its lifestyle, affordability, improved transport links, engines of economic growth, population growth and proximity to major job poles.
"For example, $1 billion has recently been spent on infrastructure, including the duplication of the Southern Motorway, the McLaren Vale Viaduct and the electrification and extension of the network railway from Noarlunga to Seaford," Ms Hill said.
Ms Hill said she has a track record of steady price growth and above-average rental returns, making it one of the most populated areas in South Australia.
"Over the next 20 years, the region is expected to receive an influx of an additional 48,000 residents," she said.
Penrith City Council (Sydney)
Suburb: Kingswood – $790,000
Rental vacancy rate: 1%
Located in Western Sydney, Penrith City Council benefits from the region's economy and is expected to create 12,000 jobs by 2036.
"Over the past two years, the Penrith property market has received a 'ripple effect' from growth in Sydney, with most suburbs seeing double-digit annual growth in median prices in recent years years," Ms. Hill said.
Penrith City Council is ideal for tenants or home buyers with slightly higher budgets.
"Penrith has a robust major infrastructure program, has seen population growth every year for decades, has various industries which keep its economy vibrant, as well as a more affordable property market which is incredibly active for renters and buyers," Ms. Hill says.
Suburb: Mirrabooka – $385,000
Rental vacancy rate: 0.4%
The City of Stirling is one of four neighborhoods that helped spur Perth's market recovery two years ago.
Home to Scarborough beach, the seaside town of Stirling makes it attractive to young buyers and renters.
"Shops and educational establishments, together with good transport links to Perth's CBD, further add to the attractiveness of the area," said Ms McDougall.
As the City of Stirling is Perth's largest local government area, it is expected to continue to see infrastructure improvements, which would benefit its suburbs.
Moreton Bay Regional Council (Brisbane)
Suburb: Caboolture – $445,000
Rental vacancy rate: 0.7%
Ms. McDougall said the Moreton Bay area ticks many fundamental investment boxes for real estate investors.
"A few years ago, Moreton Bay was listed as a priority growth area by the state government, with its population expected to reach half a million within about two decades," a- she declared.
"One of the many major projects planned for the area is the development of Caboolture West, which is a growing neighborhood that has a plethora of attributes as well as affordable properties."
In addition, Caboolture West is identified as a major expansion area in the South East Queensland Regional Plan.
Located in the heart of a rapidly growing corridor north of Brisbane, Caboolture West is expected to eventually provide around 30,000 homes for around 70,000, generating almost 3,000 jobs.
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Photo by @patwhelen on Unsplash.
