How to Find High Yielding Properties

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Join Your Investment Property magazine's editor Sarah Megginson for an exclusive webinar where we will show you how we used Real Estate Investar data to discover the high yield suburbs we highlighted in our April special report.

Date 22nd May 2019 at 8pm AEST
Location Webinar
Price Free

A high cash flow property investment is one that pays you more each month than it costs you to own.

Say the property sets you back $2,500 every month once mortgage repayments, council rates, insurance and other ownership costs are paid; a positive cash flow investment would then generate an income of more than $2,500 per month, thereby delivering instant profits to your bank balance.

When we look long term, the aim of most investors is to own their investments outright so they can eventually live o­ the income in retirement – and positive cash flow investments could be a step in that direction.

For instance, let’s go back to the previous example and assume this property generated a monthly income of $2,800, or $300 more than the expenses. After you’ve paid tax on that income (equivalent to your income tax rate; we’ll assume roughly one third), you’ll be left with $200 in additional income.

Plow that income straight back into the investment mortgage and you could accelerate your ownership plans. In fact, you could save up to $60,000 over the life of the loan – and own the property six years sooner.*

High-yield properties are also important for lower-income Australians who want to build a portfolio but can’t afford to manage additional expenses on a property where the income doesn’t cover the outgoings.

That said, not all high-yield properties are created equal. In chasing big property returns, investors could turn to remote locations based on the promise of a high rental income, without factoring in the potential for higher vacancy rates and/or sluggish capital growth.

It’s crucial that you consider the bigger picture when planning your next investment, which means doing your due diligence on everything from vacancy rates and unemployment rates to historical capital growth and population forecasts. The suburbs in this report may give you some inspiration as you embark on your search for your next investment.

Join Your Investment Property magazine's editor Sarah Megginson for an exclusive webinar where we will show you how we used Real Estate Investar data to discover the high yield suburbs we highlighted in this special report.
Date & Time: Wednesday 22nd May 2019 at 8pm
Register: realestateinvestar.com.au/yip-webinar
Bonus: Free Top 200 Yielding suburbs report. RRP $297

*Calculation based on the yourmortgage.com.au Extra Repayment Calculator, assuming a mortgage of $300,000, an interest rate of 4.5% and a 30-year loan term, with extra repayments made from the beginning of the loan.

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The full article highlighting all 141 high-yield top performers including suburb profiles was published in the April 2019 edition of Your Investment Property magazine. Download the magazine now.

 

 

 

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