Rental yield is the cornerstone of a successful property investment. Positive cash flow from real estate isn't just money in your pocket – it's money off your mortgage. But where do you find properties that provide this in Adelaide?
Two bedroom units
On average Adelaide's investment property yields are fairly high compared to those of most other capital cities.
Two bedroom units are your best bet for high rental yields. According to SQM Research data, they were returning around 5.2 per cent on average as of early March 2017. As that's the average, it could be possible to find investment property yields even higher.
Buying a home with solid yields won't clear out the coffers either. On average, units in Adelaide are valued at around $350,000, according to CoreLogic RP Data. Looks like affordability and profitability can go hand in hand!
Three bedroom homes
For an alternative option in a slightly higher price bracket, consider three bedroom homes. The average value for a detached house in Adelaide nears $500,000, but high rental yields make them worthwhile Adelaide investment properties.
SQM Research puts three bedroom house's average investment property rental yields at 4 per cent. Despite their slightly lower yield, such properties are certainly still worth considering as CoreLogic Data shows that on average they appreciate in value faster than units do.
If you can afford to top up the mortgage repayments after renting, a detached house may be the better long term investment.
Prime locations
No matter how perfect the property you select, if it's in the wrong location it won't be a successful investment. When selecting your Adelaide investment property, the city centre's not a bad place to start – the average yield for units in the area is 5.45 per cent according to Smart Investment Property.
For even better returns look to units in Elizabeth Downs where the average return is sky high at almost 8 per cent. Those with slightly deeper pockets should look at house in the next suburb across – Elizabeth North – where houses return almost 7.5 per cent.
When you've got the perfect Adelaide investment property in your sights, get in touch with the expert team here at Advantage Finance. We can tailor a wide selection of loan products to your specific needs, to help take the financial stress out of your investment.
We'll be with you for advice and support every step of the way. From the day you welcome your first tenants, through to the moment you sell for a massive capital gain.
