The month in review: Albury

By Herron Todd White
July, 2010

In 2009, we commented that half a million dollars would invest in a block of flats, with an expectation to earn 4.5% to 6% gross return per annum. Or construct a new home in new established residential areas such as ‘Eastern Views Estate’, ‘White Box Rise Estate’ to receive tax depreciation benefits. In June 2010, this picture has not changed dramatically. Investing $500,000 into the local residential market in Albury/Wodonga gives a range of options. Investing in a block of flats in the sought after area is still the smart choice.

Central Albury is showing the quite impressive rental yields of up to 6.5% gross for strata unit and 6% to 7% for blocks of flats. Circa 2000s single residential homes in good locations are showing 4.5% to 5% gross yield. The lowest rental yields are being shown by most top end single residential homes as there is a ‘ceiling’ that potential tenants are prepared to pay for residential accommodation. This ‘ceiling’ sits about $550, on a $750,000 property, with the rental at the ceiling of $550 per week, the expected gross rental return would be
between 2.5% and 3.5%. Not a good investment by any means.

If you want to get a taste for country life, investing a lazy half mill in a semi-rural lifestyle property in either Tabletop or Splitters Creek can be a good alternative. However, rental returns are only fair, as is capital growth.

Please note that information in this publication is subject to change without notice. Smartline assumes no responsibility for any errors, omissions or mistakes in this document. © 2009 Smartline Home Loans P/L. ABN 38 085 370 270