Top Suburbs for Rental Yield in Victoria
To help you find the ideal place for your investment property, we’ve compiled the suburbs with the highest rental yields.
When it comes to real estate investments, your property’s location is an essential detail. As a property investor, you need to do your due diligence and find a suburb with a price range that fits your budget and can provide the best return of investment.
To help you find the ideal place for your investment property, we’ve compiled the suburbs with the highest rental yields below.
Victoria rental real estate overview
Recent tax reforms have seen some investors opt out of doing business in Victoria with some established investors choosing to sell rather than continue to rent out properties. However, a lot of property investors still believe the state has worthwhile real estate investment opportunities because of Victoria’s steady economic growth, increasing population, and a strong demand for rental housing with a notably low vacancy rate of around 1%.
Victoria has one of the strongest economies in the country home to industries such as finance, manufacturing, tourism, construction, and agriculture. The stable and strong local economy helps contribute to the growing population, rental demand, and increasing average house prices.
Suburbs in Greater Melbourne with the highest rental yields
According to the latest market insights from REIV, the median weekly rent is at $560 and the average rental yield is at 3.2% across Metropolitan Melbourne.
For houses in Greater Melbourne, the top rental yields are above 4%, however, a majority of the median rental value is lower than the average yield for Metropolitan Melbourne.
Units with the highest rental yields are notably higher than the average rental yield with median rental values hovering between $443 to $672.
Highest rental yield suburbs in Greater Melbourne for houses
| Suburb | Region | Rental yield | Median rental value |
|---|---|---|---|
| Coolaroo | Melbourne – North West | 4.5% | $470 |
| Campbellfield | Melbourne – North West | 4.5% | $472 |
| Melton | Melbourne – West | 4.4% | $403 |
| Meadow Heights | Melbourne – North West | 4.4% | $471 |
| Melton South | Melbourne – West | 4.4% | $412 |
| Jacana | Melbourne – North West | 4.3% | $458 |
| Broadmeadows | Melbourne – North West | 4.3% | $457 |
| Wollert | Melbourne – North East | 4.2% | $582 |
| Roxburgh Park | Melbourne – North West | 4.2% | $510 |
Source: CoreLogic Best of the Best 2023 (December 2023) report
Rental yields in the Greater Melbourne region for houses are lower compared to units in Greater Melbourne and rental yields in Regional Victoria. It may be attributed to several factors such as new tax reforms, high property costs, and more competition.
Most of the top yielding suburbs for houses in Greater Melbourne can be found in the Melbourne – North West region with only three found in Melbourne – West and Melbourne – North East.
Highest rental yield suburbs in Greater Melbourne for units
| Suburb | Region | Rental yield | Median rental value |
|---|---|---|---|
| Coolaroo | Melbourne – Inner | 7.2% | $502 |
| Travancore | Melbourne – Inner | 6.8% | $517 |
| Melbourne | Melbourne – Inner | 6.3% | $624 |
| Notting Hill | Melbourne – South East | 5.7% | $503 |
| West Melbourne | Melbourne – Inner | 5.7% | $588 |
| Southbank | Melbourne – Inner | 5.7% | $649 |
| Flemington | Melbourne – Inner | 5.7% | $443 |
| Box Hill | Melbourne – Inner East | 5.5% | $558 |
| Footscray | Melbourne – West | 5.5% | $479 |
| Docklands | Melbourne – Inner | 5.4% | $672 |
Source: CoreLogic Best of the Best 2023 (December 2023) report
Rental yields for units are much higher compared to those for houses in Greater Melbourne. Units also have a higher median rental value which some investors find more attractive in terms of returns. Most of the suburbs on the list above are found in Melbourne – Inner. The region’s proximity to the Melbourne CBD could be a factor in their rental yield compared to the rest of Greater Melbourne.
Suburbs in Regional Victoria with the highest rental yields
Rental yields in Regional Victoria are higher compared to Greater Melbourne. The relatively lower property prices, population, economic growth, and positive real estate trends may have influenced the rental yield disparity.
Highest rental yield suburbs in Regional Victoria for houses
| Suburb | Region | Rental yield | Median rental value |
|---|---|---|---|
| Nhill | North West | 7.3% | $314 |
| Red Cliffs | North West | 6.3% | $391 |
| Mortlake | Warrnambool and South West | 6.2% | $394 |
| Mooroopna | Shepparton | 5.9% | $455 |
| Morwell | Latrobe – Gippsland | 5.9% | $383 |
| Stawell | North West | 5.7% | $372 |
| Ararat | North West | 5.6% | $379 |
| Portland | Warrnambool and South West | 5.6% | $416 |
| Horsham | North West | 5.5% | $387 |
| Moe | Latrobe – Gippsland | 5.4% | $385 |
Source: CoreLogic Best of the Best 2023 (December 2023) report
For Regional Victoria, houses have higher top rental yields compared to units. This may mean there’s a higher demand for houses in the area or that house prices are considerably lower. Although most of the suburbs are found in the North West region, the rental yields in the area are notably different.
Highest rental yield suburbs in Regional Victoria for units
| Suburb | Region | Rental yield | Median rental value |
|---|---|---|---|
| Benalla | Hume | 5.8% | $350 |
| Mildura | North West | 5.7% | $337 |
| Sale | Latrobe – Gippsland | 5.7% | $356 |
| Moe | Latrobe – Gippsland | 5.6% | $289 |
| Traralgon | Latrobe – Gippsland | 5.6% | $329 |
| Morwell | Latrobe – Gippsland | 5.5% | $294 |
| Wodonga | Hume | 5.4% | $367 |
| West Wodonga | Hume | 5.3% | $357 |
| Shepparton | Shepparton | 5.2% | $352 |
| Golden Square | Bendigo | 5.2% | $364 |
Source: CoreLogic Best of the Best 2023 (December 2023) report
The top rental yield suburbs for houses in Regional Victoria are mostly found in the Hume and Latrobe – Gippsland regions. The rental yields for the suburbs are around 5.2% to 5.8% with a median rental value between $289 to $357. Because of the close rental yields among the top yielding suburbs, investors may have more options when choosing a place to purchase investment properties.
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