The top 10 holiday hotspots: Finder.com.au
Despite being Australia’s most popular travel destination, houses in the Sydney CBD have an median yield of just 3.33%, according to finder.com.au.
Meanwhile, units Darwin, which is at the bottom of Tripadvisor’s Traveller’s Choice 2014 Top 10 Destinations, have a median yield of 6.82%.
The comparison website analysed the country’s top 10 tourist destinations to see how their investment potential stacked up against their popularity with visitors. With a median CBD house price of $1.75 million and median rent per week of $1,120, the city’s estimated yield of 3.33% is the second-lowest of any city on the list.
Michelle Hutchison, finder.com.au Money Expert, says that popular holiday destinations present widely varied returns for property.
“It’s always nice to imagine what it would be like to own an investment property at your favourite holiday spot, but our findings revealed there can be a big difference between the value of return you can receive for the most popular holiday destinations,” said Hutchison.
“For instance, out of the top 10 most popular holiday destinations in Australia, some yields were less than half of others on the list, with yields ranging from 2.41 to 6.31% for houses and 5.33 to 7.77% for units.
“By doing your research on the most popular destinations and making an informed decision, property investors could be making more than twice the amount of yield per year.”
New South Wales’ Cessnock had the lowest median house price of any of the top 10 destinations on the list, returning the highest yield for houses at 6.31%. Port Douglas had the highest yields for units, with 7.77%.
“While holiday homes may be a good option for investment property owners, not knowing the yield of your potential property may leave you funding someone else's holiday instead of your own,” said Hutchison.
“So make sure you do your homework, compare locations based on potential returns and not just their popularity, and research investment home loans to ensure you get the biggest bang for your buck,” she said.
finder.com.au's top investment holiday hotspots: Houses
- Cessnock, New South Wales
Median house price: $255,500
Median weekly rent: $310
Yield: 6.31% - Byron Bay, New South Wales
Median house price: $705,000
Median weekly rent: $670
Yield: 4.94% - Hobart, Tasmania
Median house price: $468,000
Median weekly rent: $435
Yield: 4.38% - Darwin, Northern Territory
Median house price: $903,500
Median weekly rent: $750
Yield: 4.32% - Brisbane, Queensland
Median house price: $959,000
Median weekly rent: $770
Yield: 4.18% - Port Douglas, Queensland
Median house price: $500,000
Median weekly rent: $380
Yield: 3.39% - Airlie Beach, Queensland
Median house price: $667,000
Median weekly rent: $435
Yield: 3.39% - Melbourne, Victoria
Median house price: $993,500
Median weekly rent: $605
Yield: 3.37% - Sydney, New South Wales
Median house price: $1,175,000
Median weekly rent: $1,120
Yield: 3.33% - Canberra, Australian Capital Territory
Median house price: $2,150,000
Median weekly rent: $995
Yield: 2.41%
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Some of the cities with the highest yields for houses had the lowest yields for units.
The top investment holiday hotspots: Units
- Port Douglas, Queensland
Median unit price: $184,000
Median weekly rent: $275
Yield: 7.77% - Darwin, Northern Territory
Median unit price: $510,500
Median weekly rent: $670
Yield: 6.82% - Brisbane, Queensland
Median unit price: $455,000
Median weekly rent: $570
Yield: 6.51% - Sydney, New South Wales
Median unit price: $598,000
Median weekly rent: $720
Yield: 6.26% - Airlie Beach, Queensland
Median unit price: $338,500
Median weekly rent: $405
Yield: 6.01% - Byron Bay, New South Wales
Median unit price: $441,500
Median weekly rent: $510
Yield: 6.01% - Canberra, Australian Capital Territory
Median unit price: $450,500
Median weekly rent: $510
Yield: 5.89% - Melbourne, Victoria
Median unit price: $414,500
Median weekly rent: $465
Yield: 5.83% - Cessnock, New South Wales
Median unit price: $259,500
Median weekly rent: $290
Yield: 5.81% - Hobart, Tasmania
Median unit price: $424,000
Median weekly rent: $435
Yield: 5.33%
