Geelong’s rental hot spots as investors reveal long-term strategy
PROPERTY investors are looking at Geelong with a long-term view for capital growth while pocketing immediate returns as new data reveals the city’s rental hot spots.
Belmont and Highton are the most in-demand suburbs for rental homes in the past six months, according to Realestate.com.au.
More than 330 Belmont rental properties attracted 417,516 views — averaging 1243 per property, while 325 properties in Highton had 342,856 views — an average of 1055.
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Property insiders said keen investors were capitalising on strong demand as local property managers told the Advertiser they faced queues of up to 30 hopeful tenants for a single rental property. Readers reported witnessing more than 50.
Gartland Property, Geelong agent Nathan Ashton said this year could be the year of the investor.
“A lot of investors were looking for really solid growth and a good return in the immediate future, whereas now they are looking at purchasing with a longer term vision,” Mr Ashton said.
“They are not going to get the immediate growth as it has already occurred but they are going to get a good yield today and in five to 10 years time we will see a bit more of the capital appreciation.”
MOST IN-DEMAND RENTAL SUBURBS
Average views per property
Source: Realestate.com.au for six months to February 28.
He said the investors buying now had the capacity to make swift purchases.
“They are not going to haggle on price as they know the rental yields are supportive of the price they are paying,” he said.
Mr Ashton said any rental yield above 4 per cent was pretty good but anything over 4.5 per cent was really good.
The top five rental returns in Geelong are unit markets in Lara, Norlane, Leopold, Bell Park and Manifold Heights, according to CoreLogic data that shows yields ranged from 4.7 per cent to 5.2 per cent.
The best returns for houses were in Marshall, Wandana Heights, St Albans Park, Breakwater and Whittington, while yields ranged from 4.3 per cent to 4.5 per cent.
Mr Ashton said he sold a lot of new townhouses and units to investors as they offered exceptional tax benefits along with really good rental yields.
Hayeswinckle, Highton agent Michelle Winckle said units were quite popular with investors as they were low maintenance.
“Geelong is always a good solid investor market and investors like Geelong as it is close to the coast and it has great amenities,” she said.
Ms Winckle said she found investors typically focused on suburbs along the ring road corridor.
Buyers agent Karen Avallone said investors were in Geelong for short and long-term growth with a reasonable yield that was better than Melbourne.
“If we had a client chasing yield where growth wasn’t important, we wouldn’t look in Geelong,” Ms Avallone said.
“We see Geelong as having good medium and long-term prospects for growth.”
Ms Avallone recently bought a house in Iona Ave, Belmont for an investor for close to the asking price of $525,000. It’s now up for rent for $425 a week.
“Yields are definitely jumping and vacancy rates are extraordinary,” she said.
Geelong’s rental vacancy rate is 1.7 per cent, according to REIV.
HOW GEELONG’S TOP RENTAL SUBURBS RATE
12 month change
Median asking rent
Gross rental yield
St Albans Park