Where Millennials can make $1m in SA property in 10 years

Looking to make a fortune in property? Here are the 10 SA suburbs where finance savvy Millennials can start making their fortune now – with a deposit as low as $16,000.

Finance-savvy Millennials facing some of the toughest conditions in generations have become millionaires working the system to find the best suburbs to make money off the property market.

And now, new data from PropTrack has uncovered suburbs where Millennials – those aged between 26 and 42 – can invest to make money now, using rents to pay off more than their mortgage repayments, but also where they too can become millionaires inside a decade.

If SA property experiences the same value growth over the next 10 years as it did the past decade, homes Prospect could be worth almost double what they are now – potentially rising by 98 per cent from its current $1.05m median to $2.08m.

Popular Prospect Rd is one of the main reasons Prospect is so sought by househunters and tenants alike. AAP/ROY VANDERVEGT

This would be an increase of a whopping $1.03m.

Parafield Gardens has also experienced 98 per cent growth over the past decade. Should this continue at the same rate, homes there could be worth $1.056m in 2033 – a far cry from its current $534,000 median.

Making money in property doesn’t mean you need to start with a lot of money, investor Eddie Dilleen says.

The 31-year-old lives in Sydney’s inner-western suburbs and has amassed a 75-property portfolio, starting with zero assets and no inherited real estate.

He said it is possible for the average investor to become $1m richer within a decade through property.

“You can get in with as little as a 5 to 10 per cent deposit, so looking at a $300,000 unit, a 5 per cent deposit is $16,000 – that’s achievable for anyone,” Mr Dilleen said.

“You can do that today. It’s still achievable for anyone working at McDonald’s or on a lower income to do that. It just takes a different mindset.”

Young property mogul, Eddie Dilleen pictured at home. He has amassed 75 investment properties. Picture: David Swift

PropTrack economist Angus Moore said most Millennials will have a different homeownership experience from their parents.

“Homeownership rates among 24 to 35-year-olds are lower than they were a few decades ago,” he said.

“They’ll be buying at a later point in life. They’ll be carrying debt later. So they won’t be mortgage free as early as perhaps their parents were.”

Mr Moore said a nationwide repeat of the growth the Australian market has experienced over the past decade was unlikely over the next one but “there are certainly places that will see strong growth in the next 10 years”.

Mr Dilleen said SA property should form a part of every Australian investor’s property portfolio.

“Some of the properties that I purchased there in 2017 have more than doubled in price in just four years,” he said.

“All investors with a property portfolio should have properties in Adelaide, because even though prices up have gone up there, they still have better rental yields than Sydney and Melbourne.”

Kurralta Park’s popular shopping centre on Anzac Highway is helping drive value growth and fuelling strong rental yields in the suburb. Pic Tait Schmaal.

While many investors look for long-term gains, those looking to make money now through rental yields should look at buying a unit in Kurralta Park.

Median mortgage repayments currently sit at $1580, with units renting for $1880, delivering a gross monthly yield of $300.

Smithfield Plains had the highest rental yield for houses – with landlords up $280 each month – while Now Port has the highest gross overall rental yield when looking at a suburb’s combined house and unit pool at $240 per month.

PropTrack’s calculations assume a mortgage rate just above 5 per cent based on RBA data on average rates on new loans for November, 2022, and adds in the cash rate change from December 2022.

PropTrack economist Angus Moore said units tended to have better gross rental returns “in part because they’re more affordable to buy but the rent doesn’t fall by as much commensurately”.

New Port has the highest gross overall rental yield at $240 per month. Pic: Realestate.com.au

“The important caveat there is that these are gross rental yields, so it’s not accounting for costs like maintenance fees, strata fees, council rates, which for units can be quite significant,” he said.

“For other investors long-term capital growth might be more important, and so knowing your suburb and the prospect for price growth might be more important to you than a steady rental cash flow.”