The rapid increase in house prices in some parts of Australia has resulted in dramatic drop in rental yields in those areas according to a recent report by rpdata.com.
One of the biggest surprise falls in rents occurred in the resource-rich mining town of Collinsville in North Queensland where housing yields fell by 2.4% from a yield of 9.1% a year ago to 6.7%. During the same period, median house price surged by 8.7% in the area.
Newcastle’s Garden Suburb recorded the second biggest drop in rental yields, losing 2.3% to 4.5%, however, median house prices jumped by a massive 31.1% over the same period.
Another fast-growing town, Seaholme in Victoria saw yields fall by 1.4% to 2.2% after median house price rose to a phenomenal 64.5%.
In the unit market, Cromer in NSW racked up the biggest loss in rental yield, with a drop of 2.5% to 4.6% during the past 12 months…
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© Your Mortgage and republished with permission; January 22, 2010
Source: Your Mortgage Magazine