Revealed: The 136 Australian suburbs where investment properties pay for themselves

Port Hedland has a rental yield of 12.3 per cent, PropTrack figures show.

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They are the suburbs where investment properties pay for themselves.

A new report by PropTrack has identified the Aussie suburbs with the highest rental yields for houses and units, including postcodes where investment properties are positively geared; which means the rental income covers all the costs of holding the property, such as home loan repayments, strata fees, council rates, landlord insurance and property management fees.

To be positively geared, or at least neutral, a property needs a rental yield of at least 6 per cent.

PropTrack crunched the numbers and revealed 136 top suburbs around Australia that fit that bill.

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Areas near mining projects are always the highest yielding for rental income, due to the low value of properties and the high rent caused by demand from workers on the projects.

For this reason, the Western Australian outback tops the list for the highest yielding units.

The suburb of Newman has a median unit sale price of $210,000 and median weekly rent of $615, which equals a 13 per cent rental yield. Newman is followed by Pegs Creek (12.9 per cent yield), Port Hedland (12.3 per cent), South Hedland (11.2 per cent) and Bulgarra (11.2 per cent).

Port Hedland’s mining connections mean high rental yields.

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For houses, it was Coolgardie (11.5 per cent), followed by Kambalda East (11 per cent), Baynton (10.6 per cent), Port Hedland (10.5 per cent) and Nickol (10.4 per cent).

For Perth suburbs, just the unit markets of Wellard (6.3 per cent) and Northbridge (6.1 per cent) were above the 6 per cent mark.

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In Victoria, the Melbourne unit market had five suburbs above 7 per cent, being Travancore (7.9 per cent), Notting Hill (7.4 per cent), Melbourne (7.3 per cent), West Melbourne (7.2 per cent) and Carlton (7 per cent).

Top mention for regional Victorian houses was Warracknabeal, where $340 a week on a median priced home of $260,000 translated to an 8.3 per cent yield.

Units in Travancore provide significant returns.

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Tasmania had three regional suburbs only where houses could be considered positively geared: Zeehan (8.5 per cent), Queenstown (8.1 per cent) and Strahan 7.2 per cent.

Regional houses in SA also proved strong with Port Pirie West, Roxby Downs, Solomontown, Peterborough, Jamestown, Port Pirie South, Risdon Park and Waikerie all above 6 per cent yield.

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Qld’s mining areas yielded strongly too, with units in Moranbah at 10.7 per cent, houses in Pioneer at 10.3 per cent and areas such as Dysart, Blackwater, Emerald and Mackay all featuring.

NSW had three suburbs for units above 6 per cent, being Jindabyne (7.5 per cent), Moama and Crestwood, while its regional top 10 for houses were all at 7.2 per cent or above.

Coonabarabran topped the list at 9.2 per cent, followed by Broken Hill (8.7 per cent), Condobolin (8.6 per cent), Henty (7.8 per cent) and Moree (7.7 per cent).

In Sydney itself, units in Ultimo (6.3 per cent), Auburn (6.3 per cent), Mascot (6.2 per cent) and Chippendale (6.1 per cent) made the mark.