- These regions were chosen for affordability
- The main criterion was a median house price below $500,000
- Townsville scored highest on Investorkits analysis
InvestorKit has released its latest analysis, delving into Queensland locations that can be purchased for less than half a million dollars.
The company delved into SA3 areas in Queensland that had median prices below $500,000, and whittled down four of the best locations, from some 20 regions.
In the report, each region is given a score out of five, with a higher score correlating to a stronger economy and representing a good time to invest in the market. The scores are based on incoming supply, growth cycle, price pressure, rental pressure and rental yield.
Top 4 regions to buy a house in Queensland
- Townsville, Score 5.0
- Rockhampton, Score 4.8
- Cairns – South, Score 4.7
- Bundaberg, Score 4.2
“Among the 20 Queensland SA3 regions where many suburbs have median prices below $500,000, four regions caught our eye: Bundaberg, Townsville, Rockhampton and South Cairns,” InvestorKit Head of Research and founder Arjun Paliwal.
“Not only do these areas have affordable house prices, but they also show the potential for further capital growth, healthy rental yields and expected rental growth in the short term due to the high pressure in their sale and rental markets.”
Arjun Paliwal, InvestorKit head of research and founder
“These locations also stand out because of internal migration towards affordability and lifestyle alongside their thriving local economies due to industry diversification and infrastructure investments.”
Townsville
Located some 1,300 kilometres north of Brisbane or a two hour flight away, median house prices in Townsville are $400,000, according to Investorkit.
The latest figures show a recovery from 2020 levels, with the 12 month growth coming in at 9.6%. This comes as many locations around the country saw declines during the same period, with the 10 year median price increase found to be 8.7%.
Asking prices for North Queensland region
“Even with a high level of outgoing charges in the form of insurances, property management and rates, it’s important to note the high yield neutralises many of these points, bringing it back to a more normal rental yield,” said Paliwal.
“What can’t be underestimated here is the sheer level of shift in the city’s local economies. From one of the worst in 2016 to now one of the nation’s best in unemployment levels, spending and more. Prices and rents in our opinion remain heavily undervalued here, irrespective of what one may think of with outgoings, weather and more.”
Rockhampton
Coming in at an even more affordable $385,000 median price, the major inland city has seen prices rise 5.5% over the past 12 months, according to Investorkit. Prices have risen 16.7% over the past decade, with the region seeing strong rise in median rents.
The report noted that: “The average number of rental listings have decreased by 3.8% and the vacancy rates still remain below 1%.”
Based on rent growing by a total of 25% over the decade, report author Paliwal predicts there will be a strong future upside in the area for both price and rental growth, as current performance remains well-under long-term averages, while the current market heat indicators are far better than any year over the last decade – indicating change is occurring here.
Rental vacancy rate for Central Queensland
Rental yield for Central Queensland
Cairns – South
This region recorded the highest median price of the four at $485,000. Despite that, the growth figures for Cairns – South has been particularly strong, seeing a 12.2% rise over the past 12 months and a 47.7% rise over the past decade.
The report noted the median price rises were below long-term averages, “offering room for growth.” It was also observed that: “… there is currently a high-level yield of 5%”, with Paliwal predicting this trend to continue given the strong rental growth trends over the past decade.
Rental vacancy rate for Cairns
Rental yield for Cairns
Bundaberg
The region “stood out as one of Australia’s top 10 performers in 2022,” according to Paliwal, who noted, “There is more room for growth, as the 10-year average is still under 25-year averages for annual growth.”
Median prices in the region are $45,000, a 12-month increase of 23.6% and 50.8% increase over the past decade.
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* Statistical Area, or SA, is an Australian Bureau of Statistics (ABS) ‘standard framework’ of areas, regions, towns, and cities. For full details, please see the ABS website.
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