Top Suburbs for Rental Yield in New South Wales
Real estate is a hyper-localised market so when doing your research it’s important to go by suburb. Every suburb follows its own market trends that may not coincide with what’s happening nationwide or statewide. Similar properties with different area codes could have vastly different property values and rental yields.
When you invest in rental properties, looking at potential rental yields is essential. To help you in your investment journey, here’s an overview of high-rental yield suburbs in NSW.
A quick snapshot of NSW real estate
New South Wales, and Sydney specifically, has been a hotspot among property investors. Many want to capitalise on the growing demand for housing in the CBD and surrounding areas. With soaring property values, rental costs, and living costs in Sydney, more investors and renters are flocking to suburbs in regional NSW as well.
Getting into the rental market can be difficult with properties in NSW being some of the most expensive in the country. Median residential dwelling prices in the state are $1,184,500; the next highest is ACT at $948,500, a staggering $236,000 difference.
Rent prices in NSW have also increased in the last five years due to higher demand and interest rate hikes. To make the most out of the NSW rental market, you need to ensure your investment plan aligns with real estate trends.
Suburbs in Sydney with the highest rental yield
Sydney is one of the top real estate markets in Australia. It’s a popular destination for property investors because of the strong population growth and economic activity. The CBD and North Sydney, in particular, are major employment hubs.
There’s also a strong rental demand in Sydney. CoreLogic’s most recent rental report has Sydney at a 1.2% residential vacancy rate. This is especially low considering a healthy vacancy rate sits at 3%. It’s not a mystery why investors are clamouring to add a Sydney property to their portfolio even with rising property costs.
Here are the top-performing suburbs in Greater Sydney based on gross rental yields:
Top rental yield by Suburb in Syndey (houses)
| Suburb | Region | Rental Yield | Median Rental Value |
|---|---|---|---|
| Blue Haven | Central Coast | 4.2% | $581 |
| San Remo | Central Coast | 4.1% | $541 |
| South Windsor | Sydney - Outer West and Blue Mountains | 4.0% | $614 |
| Charmhaven | Central Coast | 4.0% | $552 |
| Watanobbi | Central Coast | 4.0% | $565 |
| Gorokan | Central Coast | 4.0% | $543 |
| Windsor | Sydney - Outer West and Blue Mountains | 4.0% | $612 |
| Lake Haven | Central Coast | 4.0% | $569 |
| Kanwal | Central Coast | 4.0% | $566 |
| Emerton | Sydney - Blacktown | 3.9% | $530 |
Source: CoreLogic Best of the Best 2023 (December 2023) report
Houses in Greater Sydney have a moderate rental yield with an average of 4%. There's not much difference between the top 10 performing suburbs with rental yields ranging from 3.9% to 4.2%. As an investor, you can choose from plenty of property options within Greater Sydney without sacrificing potential rental yields.
Top rental yield by Suburb in Syndey (units)
| Suburb | Region | Rental Yield | Median Rental Value |
|---|---|---|---|
| Lakemba | Sydney - Inner South West | 6.5% | $515 |
| Granville | Sydney - Parramatta | 6.1% | $553 |
| Wiley Park | Sydney - Inner South West | 6.1% | $501 |
| Mays Hill | Sydney - Parramatta | 6.0% | $620 |
| Rosehill | Sydney - Parramatta | 6.0% | $539 |
| Auburn | Sydney - Parramatta | 6.0% | $600 |
| Punchbowl | Sydney - Inner South Wests | 5.9% | $514 |
| Mascot | Sydney - City and Inner South | 5.9% | $912 |
| Harris Park | Sydney - Parramatta | 5.9% | $522 |
| Warwick Farm | Sydney - South West | 5.9% | $443 |
Source: CoreLogic Best of the Best 2023 (December 2023) report
Rental yields for units in Sydney have performed better than houses with an average rental yield of 6%. Lakemba has the highest rental yield in the top suburbs with 6.5%. Most of the suburbs in the top 10 performing areas have similar rental yields save for Lakemba with .4% more gross rental yield compared to the second-highest suburb.
Suburbs in regional NSW with the highest rental yield
In light of skyrocketing property and rent prices, more people are looking to regional NSW as a place to live. A lot of property investors have started to see the potential of regional NSW, as well, taking advantage of lower property values with higher median rental values.
Top rental yield by Suburb in regional NSW (houses)
| Suburb | Region | Rental Yield | Median Rental Value |
|---|---|---|---|
| Boggabri | New England and North West | 8.5% | $398 |
| South Lismore | Richmond - Tweed | 8.3% | $504 |
| Wellington | Far West and Orana | 8.0% | $431 |
| Condobolin | Central West | 7.5% | $326 |
| Lismore | Richmond - Tweed | 7.2% | $520 |
| Lismore Heights | Richmond - Tweed | 6.9% | $542 |
| Narrandera | Riverina | 6.9% | $374 |
| Quirindi | New England and North West | 6.8% | $412 |
| West Wyalong | Central West | 6.7% | $392 |
| Narromine | Far West and Orana | 6.6% | $446 |
Source: CoreLogic Best of the Best 2023 (December 2023) report
Regional NSW has some of the highest rental yields in the state ranging from 6.6% to 8.5%. The highest rental yield in regional NSW is almost double the yield of the top suburb in Greater Sydney.
However, unlike Greater Sydney where rental yields in the top suburbs are quite similar, in regional NSW there are notable differences in yields between each suburb. If you’re an investor who wants to make the most out of your real estate investment, the location may heavily impact potential rental yields.
Top rental yield by Suburb in regional NSW (units)
| Suburb | Region | Rental Yield | Median Rental Value |
|---|---|---|---|
| Sussex Inlet | Southern Highlands and Shoalhaven | 7.6% | $660 |
| Moama | Murray | 6.3% | $374 |
| Muswellbrook | Hunter Valley excluding Newcastle | 6.2% | $366 |
| Crestwood | Capital Region | 6.0% | $446 |
| Lavington | Murray | 5.8% | $326 |
| Casino | Richmond - Tweed | 5.8% | $357 |
| Queanbeyan East | Capital Region | 5.7% | $450 |
| East Albury | Murray | 5.6% | $338 |
| Queanbeyan | Capital Region | 5.6% | $453 |
| Singleton | Hunter Valley excluding Newcastle | 5.5% | $403 |
Source: CoreLogic Best of the Best 2023 (December 2023) report
Suburbs in regional NSW have lower unit rental yields compared to house rental yields. Although not by much, it’s still a significant difference that you need to consider when choosing an investment property.
Want to invest in NSW real estate?
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