Outer-western suburb of Tregear leads Sydney suburbs for house rental yields

Tregear, in Sydney’s outer west, is the city’s suburb with the highest gross yield for houses at 7.1%.

Property Observer has listed the top 15 suburbs with the highest rental yields for houses in Sydney.

The list is dominated by western suburbs, and most have median prices in the $200,000s.

Middleton Grange had the highest median price at $407,400, with a rental yield of 6.3%.

With the highest yield, Tregear also had the lowest median price at $220,000.

Blackett had the second highest yields, followed by Willmot and Lethbridge Park.

According to the 2011 census, Tregear had a population of 3,916 and had 1,341 residences.

Managing director of Ben Price Estate Agents Ben Price says the area is made up of former housing commission properties.

“There were originally 12,000 Department of Housing homes in the area, clumped in one spot. Now more that 50% of those have been sold off. Existing tenants were offered the homes to buy and some have been sold on the private market,” Price says.

“That happened over the last couple of decades.”

RP Data lists the median price for the suburb at $220,000, but Price says that figure is probably a bit low.

“There’s not really much for $220,000. You might find something that needs a bit of work. Then you might have to spend $20,000 to get it up to a rentable condition. For that you’d get in the low $300s per week.”

Price recently sold a property on Aurora Drive to an investor for $285,000. The four-bedroom cladded home is leased at $350 a week.

He says it’s an attractive area for investors, with 50/50 divide between investors and home buyers.

“There’s not much development here. We run a vacancy rate of less than 1%. I think the returns will be there for a long time to come.”