The property investor’s must-know guide to Australia’s top 50 rental suburbs

Brisbane’s Fortitude Valley has topped the list of suburbs with the highest proportion of rentals, with 70% of dwellings occupied by renters.

It narrowly pipped Canberra’s City at 69.7% and Perth’s Northbridge at 69.3%.

The other 30% of Fortitude Valley is made up of 20.6% owned with a mortgage, 6.7% owned outright, 2.3% not stated and 0.4% other tenure.

The top 20 is dominated by Sydney and Brisbane suburbs while Victoria doesn’t make an appearance until 21, with the Melbourne CBD at 63.1% renter occupied.

The list, compiled by RP Data’s Tim Lawless using ABS 2011 Census data, does not include suburbs with fewer than 200 dwellings or suburbs where more than 25% of rental dwellings are not privately owned.

This excluded suburbs like Sydney’s Claymore where 93.9% of homes were renter occupied, but mostly made up of public housing.

The top 10 suburbs include Brisbane’s Fortitude Valley, Canberra’s City, Perth’s Northbridge, Adelaide’s New Port, Sydney’s Chippendale, Brisbane’s Spring Hill, Sydney’s Gosford, Sydney’s Ultimo, Darwin and North Cairns.

Sydney suburbs appear 20 times on the top 50, Brisbane suburbs seven times and Melbourne and Perth suburbs five times respectively. The rest of the list is made up of Queensland, Adelaide, Hobart, Darwin and NSW suburbs.

The median unit price in Fortitude Valley is $399,000 with an indicative gross rental yield of 6.0%. Some 78.6% of rentals dwellings are privately rented.

Meadowbank in Sydney had the highest proportion of privately rented properties on the list, with 97.8% of rental dwellings privately rented.

“What is even more interesting is drilling down on the Census data to show exactly where the most popular suburbs for investment/renting are located. The table below shows the top 50 suburbs around the nation that have the highest proportion of renters where at least 75% of the dwellings are privately rented (ie. dwellings where the landlord is the government or a community/church group comprise 25% or less of all occupied rental dwellings). Based on these parameters, Brisbane’s Fortitude Valley is the most popular ‘investor/rental’ suburb in the nation with 70% of all occupied dwellings being rented, followed by Canberra’s city centre (69.7%) and the Perth suburb of Northbridge (69.3%).

Of the top 50 list, 40% of the suburbs are located in Sydney, 14% are in Brisbane and 10% respectively in Melbourne and Perth. Unit dwellings are clearly the most popular dwelling type for investors, with many of the suburbs in the top 50 list recording fewer than 10 house sales over the past year (this is why a median price or rental yield is not recorded for houses in some suburbs). Yields for units tend to be well above average in most of these suburbs, highlighting the attractive investment conditions.”

Source: RP Data/2011 Census

This article first appeared on Property Observer.