Invest
Investors hit with yield warning on property
SMSF trustees looking for lower volatility in the capital value of a property should consider that yields are compressing both in Sydney and Melbourne, says one property analyst.
Investors hit with yield warning on property
SMSF trustees looking for lower volatility in the capital value of a property should consider that yields are compressing both in Sydney and Melbourne, says one property analyst.

CoreLogic RP Data's head of research, Tim Lawless, said the yield environment should be an important part of an SMSF trustee's assessment of their investment decisions.
“Of course you want to maximise your prospects for capital growth but you also want to ensure you have a decent rental market behind your investment to make sure you’re getting a high level of cash flow or rental income,” said Mr Lawless.
“For an SMSF investor looking for something a little less volatile in capital growth or loss, as well as higher, stable yields, they perhaps want to take into consideration the fact that yields are increasing in Sydney and Melbourne.”
Mr Lawless said yields in the major capital cities are currently experiencing a compressing trend.

“We’ve seen yields move lower in every capital city outside Hobart; it’s just a factor of rents and rental growth being lower than value growth,” he said.
“Yields are getting squashed smaller and smaller and in cities where we’ve seen the strongest value growth, Sydney and Melbourne, we’ve seen gross yields near 3 per cent [in] Melbourne and 3.1 per cent [in] Sydney and they’ll probably [go] lower yet.”
SMSF investors need to be conscious that the yield profile of cities which are performing best in terms of capital growth is unbalanced and that suggests that values relevant to rents are out of balance, he said.
“We either need to see rents rise or values fall to see that balance return to the market,” he said.
Low yield also implies that a marketplace is becoming more affordable in which to rent, according to Mr Lawless.
“That’s not the case in every capital city, but it’s definitely the case in Sydney and Melbourne,” he said.
Property markets such as Brisbane, Adelaide and Hobart, on the other hand, have not seen as much compression in their yield because they are still very early in the growth cycle he said.
“They’re probably looking a little better for an investment over a short to medium term,” Mr Lawless said.

Property
North platform adds household reporting feature to boost adviser efficiency
AMP's North platform has launched consolidated household reporting across multiple client accounts, helping financial advisers streamline their client review processes. Read more

Property
What Adds The Most Value To Properties?
Wondering how to up the value of your property? Properties are worth a lot of money in general, but there’s always a way to maximise value. The good news is that most of the things you can do to ...Read more

Property
Centuria reports strong growth in alternative real estate sectors for FY24
Centuria Capital Group has reported significant growth in alternative real estate sectors for the 2024 financial year, driving stable performance and increased guidance for FY25. Read more

Property
How to leverage equity in your home for investment or renovation
Home equity, the value of your property minus any debts owed, is a powerful financial resource many homeowners in Australia can utilize to further their financial goals. Whether you're looking to ...Read more

Property
Exploring REITs: Real estate investment without buying property
Real Estate Investment Trusts (REITs) offer a compelling investment alternative for those interested in the real estate market but may not want to endure the complexities and capital requirements of ...Read more

Property
Retirement communities: a pivotal element in meeting Australia's housing targets
The Retirement Living Council (RLC) has recommended that retirement communities should be considered a vital part in the Australian Government's initiative to fulfill the Housing Australia Future Fund ...Read more

Property
Australians adjust financial strategies amid changing property market dynamics
The 2023 calendar year saw Australian borrowers acquiring a total of $300.9 billion in new loans for property purchases, marking a 12.7% decrease from the previous year. Read more

Property
Split home loans unlocking doors for Aussie buyers
Australians are teaming up to dive into the real estate market and seize the advantages of home ownership, with the trend of split home loans surging as family and friends unite to buy properties ...Read more

Property
North platform adds household reporting feature to boost adviser efficiency
AMP's North platform has launched consolidated household reporting across multiple client accounts, helping financial advisers streamline their client review processes. Read more

Property
What Adds The Most Value To Properties?
Wondering how to up the value of your property? Properties are worth a lot of money in general, but there’s always a way to maximise value. The good news is that most of the things you can do to ...Read more

Property
Centuria reports strong growth in alternative real estate sectors for FY24
Centuria Capital Group has reported significant growth in alternative real estate sectors for the 2024 financial year, driving stable performance and increased guidance for FY25. Read more

Property
How to leverage equity in your home for investment or renovation
Home equity, the value of your property minus any debts owed, is a powerful financial resource many homeowners in Australia can utilize to further their financial goals. Whether you're looking to ...Read more

Property
Exploring REITs: Real estate investment without buying property
Real Estate Investment Trusts (REITs) offer a compelling investment alternative for those interested in the real estate market but may not want to endure the complexities and capital requirements of ...Read more

Property
Retirement communities: a pivotal element in meeting Australia's housing targets
The Retirement Living Council (RLC) has recommended that retirement communities should be considered a vital part in the Australian Government's initiative to fulfill the Housing Australia Future Fund ...Read more

Property
Australians adjust financial strategies amid changing property market dynamics
The 2023 calendar year saw Australian borrowers acquiring a total of $300.9 billion in new loans for property purchases, marking a 12.7% decrease from the previous year. Read more

Property
Split home loans unlocking doors for Aussie buyers
Australians are teaming up to dive into the real estate market and seize the advantages of home ownership, with the trend of split home loans surging as family and friends unite to buy properties ...Read more