Are you thinking about purchasing an investment property to rent out? If so, knowing where tenants are looking can help narrow your search. This article presents the top 10 most viewed suburbs by people who were seeking to secure a rental over the wet winter we have just left behind.
Topping the list was Mandurah in the south with more than 10,500 visits on reiwa.com.au’s ‘for rent‘ page, representing more than 10% of all site visits. This is hardly surprising given Mandurah is such a family-friendly lifestyle and tourist hotspot location with a relatively low median rent price and high Gross Rental Yield.
The full top 10 list & their respective median rent prices & Gross Rental Yield for June, July, August 2021
- Mandurah – $320 (5.7%)
- Ellenbrook – $380 (4.9%)
- Baldivis – $400 (5.0%)
- Midland – $320 (5.8%)
- Joondalup – $383 (4.1%)
- Willetton – $460 (3.6%)
- Canning Vale – $460 (4.1%)
- Scarborough – $460 (3.8%)
- Armadale – $300 (6.0%)
- Fremantle – $480 (4.5%)
This list indicate tenants are looking in every corner of Perth, with the suburbs offering an eclectic lifestyle mix, from coastal suburbs with vibrant cafe strips to inland suburbs with more open space at the gateway to the Perth Hills and vineyards.
Why is Gross Rental Yield important?
Every property investor wants to maximise their return on investment. That’s why it’s just as important to keep a close eye on a suburb’s Gross Rental Yield as it is on their popularity by searches.
Gross Rental Yield is the measure of how much rental income an asset is generating, as a percentage of the property’s value. The rental yield is useful for indicating the potential return of an investment property.
Most of the suburbs on the top 10 list above are generating decent rental returns, with Armadale topping the list with 6%. In general, rental yields are relatively healthy in Perth, with our capital’s median Gross Rental Yield for houses currently standing at 4.5%, compared to 2.6% and 2.9% in Sydney and Melbourne respectively.
Another factor to be mindful of when assessing the investment viability of a suburb and property is expected capital growth. Just remember though that property investment is a long game, not a means to make a quick profit in most cases.
Last but not least, it is interesting to observe a trend change in the areas renters are looking in comparison to pre-COVID times when more tenants would seek rentals closer to the CBD. The fact that they are looking further afield (much further in some instances) demonstrates the increase in the number of people working from home and opting for lifestyle over convenience.