Why regional Qld offers the best of both worlds

Want cash flow without compromising on capital growth? Investors in central Queensland may not have to choose.

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New analysis from Hotspotting found that regional Queensland has nabbed the “lion’s share” of high cash flow hotspots in Australia.

With strong and diverse economies, high rental returns and affordable price points, regional Queensland towns are increasingly become top choice locations for investors who want a compromise-free investment destination.

Hotspotting director Terry Ryder noted that “cash flow has become increasingly important over the past two years, given the much higher mortgage repayments in play”.

He noted that in addition to high rental yields, “it is imperative that investors seek out areas that also offer capital growth prospects, often due to their booming local economies across a diverse range of industries”.

For regional Queensland, increasingly diverse local economies are providing investors with this essential balance of rental returns and capital growth prospects.

Tim Graham, general manager at Hotspotting, stated that some areas of regional Queensland “had previously been over-reliant on the resources sector, which had a positive or negative impact on its property market depending on the strength or weakness of the mining industry at that time”.

Now, however, a burst of smaller projects across a varied array of industries are able to put this turbulence to rest.

One particular hotspot is Glen Eden in the Gladstone region of central Queensland, where the median house price is just $400,000.

“The region has had its share of ups and downs previously, predominantly due to a number of very large resource projects,” Graham reported.

“However, today its economy has a range of smaller projects that are spread more evenly across a range of sectors.”

Annual rental yield currently sits at 6 per cent, while a tight vacancy rate of just 1.2 per cent is set to further tighten in years to come with a 60 per cent population boom forecast in the next two decades.

Meanwhile, Bundaberg is another central Queensland destination with impressive opportunities on offer for property investors.

Despite experiencing annual growth of 17 per cent, the median house price in Bundaberg is just $405,000.

Ryder noted an influx of infrastructure developments in the pipeline for the town, including “the $1.2 billion new hospital as well as the $2 billion South Beach residential development in Elliott Heads”.

“However, there are a myriad other major residential, transport, community, as well as health and medical infrastructure projects under way that are all underpinning the region’s performance now and into the future,” he noted.

Finally, Berserker in the Rockhampton area is set to see significant growth in coming years, while investors can benefit from 8 per cent rental yields and a median house price of just $290,000.

“The region has billions of dollars of major infrastructure projects under way, including transport, defence, resources and energy,” said Graham, who also noted that the town centre has recently undergone a revitalisation project.

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