For many years, the number of regions where you could find positively geared areas in Australia to invest in were in short supply.
A cooling of the housing market, higher rental yields and other factors from GFC fall-out has meant there are a number of regional areas now offering cash positive investing opportunities.
Independent property investor Brett McCallum said there were a number of areas which have a good story to tell for investors.
“The big areas that people overlook are regional centres, he said. “They’re a lot more affordable than capital cities, with better rental yields. And they have such strong growth drivers.”
Mr McCallum said there was a lot of money being diverted by industry (particularly the mining industry) into regional areas, particularly in Queensland.
“There are a number of hotspots that I can see at the moment,” he said. “Townsville is a real winner there is a great story to go with Townsville and there are a lot of good opportunities.”
He said there is a huge demand for rentals and the resale market is very strong, while there is a huge rental requirement for university students and the military.
“Some of the mining sector use Townsville a home base and then travel to the mines during the shift times,” he said.
He added: “The CBD is undergoing a huge transformation at the moment, and buyers are confident that this area will eventually be a huge draw-card, resulting in higher prices for the immediate and surrounding suburbs.”
Mr McCallum always looks for positively geared properties to add to his portfolio, and has found companies such as www.saltairrealty.com.au and www.nrascentral.com.au beneficial.
He said the other area he believed would boom was the Hunter Valley and the Newcastle area in NSW.
“Newcastle is the little hotspot north of Sydney that a lot of people do not realise is a mining hotspot in Australia,” he said. “You hear a lot of talk about the Bowen basin and Western Australia but not much about Newcastle.”
“This area was built on its coal mines and is rapidly expanding on a weekly basis. There is a 1% vacancy rate in this area due to the demand of the mines and other sectors that are rapidly growing.
He added: “Newcastle is no longer a small little city north of Sydney it is now the Hunter Region all gelling together bringing in the mining, tourism, wine making and a lot of other sectors and it is only a 2 hour drive to the Sydney CBD.”
“A $1 billion port expansion has just been completed, and another $1 billion expansion is now underway. The Hunter Expressway should also boost the region’s infrastructure. It’s affordable, and I think investors and homebuyers are looking for affordability right now.”
Despite the damage and devastation caused by this year’s flood, the third hotspot Mr McCallum is interested in is Toowoomba in Queensland.
“Since the devastation of the floods in QLD we have found that areas such as Toowoomba, rentals are in even higher demand as tradies and other workers are looking to rent whilst the areas are rebuilt.” he said.
“In a lot of cases a lot of families have been misplaced and need accommodation. If we can help them by offering good quality accommodation that is affordable then we will look at this.”
Contact Brett through firstname.lastname@example.org