Townsville rental market remains tight: HTW residential

A strong pipeline of projects underway or yet to commence is creating a new air of expectation of improvement in Townsville, according to a recent Herron Todd White (HTW) residential report. 

The valuation firm took a look at rental yields across the nation. 

The report notes Townsville currently offers some good yield investing opportunities with a median house price of $320,000 as at June 2019 and the current trend median rent for houses at $360 per week.

The rental market tightened significantly following the February floods and although it has now eased somewhat, it remains tight, trending at under 2% vacancy according to our latest rent roll survey.

"We are seeing anecdotally increased investor interest including some investor groups acting on behalf of buyers seeking properties offering good yield returns and capital growth potential," the valuation firm said. 

In the current market, units are generally seeing higher yield returns due to the lower buy in cost and the trend median rent of $285 per week as at June 2019.

"We have seen some evidence of yields over 8.5% being achieved for houses in areas within the 4815 postcode due to the low buy in cost and the current rent being achieved on the back of the tighter rental market," the valuation firm added. 

The report notes house located closer to the city centre are typically showing lower yields due to the higher buy in cost, however the potential for capital growth in these areas in the shorter term is also more positive.

"Overall there are many suburbs throughout Townsville where solid yield investing options are available, particularly if not seeking short to medium term capital growth, however it is important to note that yields will vary based on demand and supply in the rental market and therefore it is important to take into consideration buying an investment property that will appeal to a wide range of potential renters."