Unit growth forecasts for the next five and eight years are substantially smaller than they are for houses across most areas. But as the median prices are also lower, they are often a better choice for investors.
The Residex classifications that we use for unit areas are also much broader.
There is a smaller number of units than houses in Australia and some areas have a very low density of units. Residex says it’s because of these factors that they aggregate units into larger regions to give the most reliable results.
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But even for units, areas that are in reasonable proximity to city centres, have good transport access, infrastructure and amenities, are those that are most likely to grow over the next five years.
Frankston units come in at number one on our list. Frankston is 45 minutes away from Melbourne and accessible now via the EastLink. The postcodes this area cover also include suburbs closer to Melbourne.
Not far behind Frankston is inner city and north west units in Melbourne, which should come as no surprise. Both these areas are recording annual yields of close to 5%, which is good news for the investor.
Also in the statistical area of Melbourne, 66.1% of residents reported that they rented their dwelling in the last Census and 99.4% of dwellings were units.
In Sydney and NSW, the areas predicted to grow the fastest are far western units. According to the postcodes, these localities range from as far afield as Badgerys Creek to Mount Druitt. The median price is quite low at $263,500 and the yield is high. The investment prospects appear quite strong, but as with all investments, make sure you do your due diligence. An area isn’t a good investment if it is miles from schools, public transport and work.
Important information: This content has been prepared without taking account of the objectives, financial situation or needs of any particular individual. It does not constitute formal advice. Consider the appropriateness of the information in regards to your circumstances.