Top 30 investor suburbs in regional Victoria

More affordable houses and better rental yields have buyers looking regional to get into the property game. SEE THE LIST.

47 Cureton Avenue, Mildura, is on the market for $380,000-$415,000.

Regional Victoria has become an investor’s haven, experts say, with markets outside Melbourne typically offering better affordability and rental yields.

And new research suggests property investors would be wise to target once-overlooked postcodes like Corio, Moe, Wonthaggi and Mildura.

Realestate.com.au has named the areas among 30 regional towns and suburbs that are standout performers for 10-year price growth, rental yields and demand among tenants.

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63 Wenhams Lane, Wangaratta, is on the market for $495,000.

REA economist Paul Ryan said Melburnians fleeing the city in droves during the pandemic had boosted demand for rentals across regional Victoria to make such spots “better outlets for investors than they have in the past”.

“A lot of renter demand has gone to regional centres where people know they’re going to get the lifestyle benefits of moving to the regions, but not without the other amenities you’d want, like access to shops,” Mr Ryan said.

“Rental yields tend to be higher the further you get from CBDs, too – and I don’t think that’s a Covid effect. (I do think) we’ll see more investors looking outside the major cities.”

Hotspotting founder Terry Ryder said it was essential to invest in places where you “can see where the growth is going to come from”.

He said towns or regional suburbs that were well connected and within striking distance of bigger cities, and offered strong job and infrastructure opportunities “ticked a lot of boxes” for renters and investors alike.

“A simple formula for investors is ‘buy property that lies in the path of progress’,” Mr Ryder said.

26 Armytage Street, Corio, is for sale for $385,000-$415,000.

“Buy on the infrastructure trail, in an area that has good transport links, affordable housing, proximity to jobs, and where there’s a strength and diversity to the opportunity.”

He named Geelong and Ballarat, as well as Warrnambool, Bendigo, Shepparton and Mildura as smart picks for their “vibrant local economy”.

Stockdale & Leggo Latrobe Valley’s Jim Demetrios has seen an uplift in first-time investors looking to regional areas for their “affordable and good, safe investments”.

A typical house in Moe gained 67.3 per cent in price in the past 10 years – and 137.9 per cent in the past 20 – and is now offering a 6.1 per cent rental yield.

Meanwhile, nearby Newborough has experienced a 15.7 per cent surge in rental demand.

“On the rental side of things, we’re at about a 1 per cent vacancy rate at the moment,” Mr Demetrios said.

“As a result, rent is definitely going up – you can get anywhere from say $250 to $400 a week. And because of that, with a lot of our investors we find that over a period of three or four years, the same investors are buying up other properties that show good returns. They’re building up a portfolio.”

1/8 Conifer Close, Yarrawonga, is up for grabs for $249,000.

Buyer’s agent Cate Bakos said homes around the $400,000 price point were popular with regional investors, with many “flipping” and then selling them for a premium.

But she said buying in the country “shouldn’t be capped to just low price points”.

“I’ve seen good, solid, long-term growth in the blue-chip areas of Geelong, where you could happily spend $1.2m – that’s not over leveraging,” Ms Bakos said.

“The secret is being familiar with the streets, making sure you know the area and asking yourself what performance you could get in a premium pocket in a place like Geelong.”

YOUNG INVESTORS PLAYING IT SMART

As soon as Echuca local Ebony Wardlaw finished school she set her sights on building an investment property.

Smart with her money and a self-confessed go-getter, Ms Wardlaw was keen to get a head start on the property game and while she knew it wouldn’t be her “forever home,” she also knew she had to start somewhere.

“My pop was actually the first one to encourage me to do it,” Ms Wardlaw said.

“He would say ‘we invested too late’ and ‘the sooner the better’. So little 19-year-old me jumped in head first.”

Ebony Wardlaw, 23, built an investment property in Echuca after finishing year 12.

The now 23-year-old said she worked in hospitality throughout year 11 and 12, then started a full-time job and received a pay rise, all while living at home with her mum, which enabled her to save up enough money to put down a deposit on a block of land.

“It was something I’d thought about pretty heavily at school and the year after year 12,” she said.

“I knew that there was only a few blocks left in this particular estate, which I knew was a good area.”

By June 2019, the build was finished and Ms Wardlaw moved in so she could receive the first homebuyer grant.

She stayed at the property for about 18 months before moving in with her partner, who had also built a house, and rented out her property.

“I want to keep the property long term, but I knew it was never going to be a forever home,” Ms Wardlaw, who started a social media page during the build and runs her own photography business, said.

“All I was really concerned about was that it covered the mortgage repayments”.

And it does.

Echuca, like many regional areas, is experiencing record-low vacancy rates, so rental properties are in high demand.

Ms Wardlaw said that it was a “big commitment” to build or buy, but she was happy she jumped in when she did.

“I’m the type of person that if I put my mind to something, I just do it,” she said.

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Originally published as Top 30 investor suburbs in regional Victoria