Positive gearing suburbs in Australia’s hottest property market
Strong rents easily cover repayments in 57 suburbs of Western Australia
3 min
Western Australia remains Australia’s strongest property market, with home values up 23.2% to a median price of $751,000 in Perth and 14.9% to a median of $528,000 in regional Western Australia over the year to August. This is the highest rate of annual capital growth among Australia’s capital cities and regional areas, according to Proptrack data.
Rents have also risen more in Western Australia than anywhere else. The latest available Proptrack data covering the March quarter shows a 15.5% annual increase in rents in Perth and a 14.3% uplift in regional Western Australia. The state has also seen the strongest growth in property investment lending as investors from all over the country seek to buy in the booming market. Proptrack economic analyst Megan Lieu said investor lending in Western Australia was 48% higher in the June quarter compared to the same period last year, according to Australian Bureau of Statistics data.
Rapid increases in weekly rents have led to more suburbs across the country offering positive gearing opportunities for investors. Proptrack has identified 140 positive gearing suburbs nationwide where rental returns entirely cover the investment loan repayments for investors.
“Rent growth has … outpaced home price growth over the last 12 months, making conditions increasingly favourable for investors,” Ms Lieu said. “While many of them are benefiting from the current market, those with properties in select suburbs are not only seeing their rental income cover their mortgage but also deliver positive cash flow.”
The data shows Western Australia has 57 positive gearing suburbs, which is the most of any state and territory. Examples of these suburbs are listed below. The data assumes a 30-year loan at an 80% loan-to-value ratio (LVR) with an interest rate of 6.52%.
Positive gearing suburbs in Western Australia
Baynton
Baynton is in the Pilbara mining region and is the best positive gearing suburb in the state. Investors can cover their mortgage repayments with $2,100 per month to spare, according to Proptrack data. A typical house in Baynton costs a median of $682,500 and fetches $5,600 per month in rent. This is more than enough to cover the monthly loan repayment of $3,458.
Kambalda West
Kambalda West is in the Goldfields-Esperance mining region of Western Australia. A typical house costs $180,000 and rents for $1,520 per month. The mortgage costs $912 per month, which gives investors surplus cash of $607 per month to help cover other expenses like council and water rates.
Port Headland
Port Hedland is the second largest town in the Pilbara mining region and another strong positive gearing suburb. The median house price is $730,000 and the rental return is $4,900 per month. The investment loan repayment costs $3,698 per month, leaving the investor with $1,201 per month in their pocket. Investors on a lower budget can buy an apartment for a median of $474,396, which will rent for $3,200 per month and easily cover the mortgage of $2,403 per month.
Cable Beach
In the Broome region of Western Australia, Cable Beach sits on a 22km stretch of white sandy coastline along the Indian Ocean. The suburb was named after a telegraph cable that was laid between Broome and Java in 1889. Cable Beach houses have a median price tag of $670,000 and rent for $3,930 per month which is more than enough to cover the loan repayment of $3,394 per month.
Perth CBD
Investors can purchase a unit for a median of $465,000 and rent it out for $2,480 per month in Perth CBD. While the loan repayment gobbles up most of this, costing $2,356 per month, it is a notable rarity for a CBD suburb in the centre of an Australian capital city to deliver positive gearing.
Mosman Park
Mosman Park is an affluent suburb along the Swan River in Perth. An Australian house price record was set here in 2009 when mining magnate Chris Ellison bought a waterfront mansion for $52.5 million. Property investors can achieve positive gearing in this suburb with apartments. The median unit costs $380,000 and commands $2,000 per month in rent. This covers the monthly mortgage repayment of $1,925.
Somerville
Somerville is a positive gearing suburb in the city of Kalgoorlie-Boulder in the state’s Eastern Goldfields region. An investment unit here will cost a median of $282,000 and command a monthly rent of $2,440. This easily covers the loan repayment of $1,428 per month, with more than $1,000 to spare.
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New research shows a widening divide across Australia and New Zealand’s property markets, with investors increasingly forced to look beyond traditional strongholds to find real returns.
3 min
By any traditional measure, Australia’s property market should be moving in sync. Instead, it is fragmenting.
New research from MaxCap, led by Head of Research Bruce Wan, paints a picture of a market no longer defined by national trends, but by sharp regional divergence, where performance gaps between cities are widening, and the smartest capital is moving accordingly.
At the top end of the ladder, Perth and southeast Queensland are surging ahead. At the other, Melbourne and Auckland are only just beginning to recover from recent downturns. And sitting squarely in the middle is Sydney, steady but constrained.
The takeaway is clear: the era of relying on headline markets is over.
The rise of the unexpected leaders
Brisbane and the broader southeast Queensland region have emerged as standout performers, driven by population growth, infrastructure investment and a sustained undersupply of housing.
According to the report, housing values in the region have continued to accelerate, supported by long-term tailwinds including the 2032 Olympic Games and a decade of relatively subdued price growth prior.
Perth is telling a similar story, albeit for different reasons. Once heavily tied to commodity cycles, the Western Australian capital is now benefiting from a broader base of economic drivers, including defence spending and sustained resource sector strength.
The result is a housing market that remains one of the strongest in the country, even as price growth begins to ease from its peak.
Sydney holds, but doesn’t lead
For Sydney, the story is more nuanced.
While prices continue to climb and the city remains Australia’s most expensive market, affordability constraints are clearly limiting its pace. Residential growth, while positive, lags behind smaller capitals, and commercial sectors are being held back by softer demand in key industries.
There are, however, signs of momentum building. New infrastructure, including the western Sydney Airport and expanded rail networks, is expected to unlock development opportunities and support future growth, particularly in emerging precincts.
Still, the report positions Sydney firmly in the “middle of the pack”, no longer the automatic frontrunner for investors.
Melbourne’s slow reset
Melbourne, once a consistent performer, has spent recent years recalibrating.
Extended lockdowns, combined with new state property taxes, have weighed heavily on investor sentiment and pricing, particularly across the commercial office sector. Residential values have also underperformed, though for different structural reasons.
Now, there are early signs of recovery.
Improved affordability, population growth and a stabilising economic backdrop are beginning to draw buyers back into the market, with both residential and commercial sectors showing tentative signs of improvement.
Auckland’s turning point
Across the Tasman, Auckland has faced its own challenges, particularly from an outflow of younger workers to Australia, which has dampened demand and stalled price growth.
But here too, the tide appears to be shifting.
A return to positive migration, lower interest rates and policy changes — including the easing of foreign buyer restrictions — are expected to support a gradual recovery, alongside renewed interest from offshore capital.
A market that rewards precision
If there is one unifying theme, it is this: broad-brush strategies no longer work.
MaxCap’s research highlights that the most compelling opportunities are increasingly found outside the traditional powerhouses of Sydney and Melbourne, requiring investors to take a more targeted, locally informed approach.
“Given these persistent performance gaps, there is plentiful scope for alpha returns, just by picking the right locations and market segments,” the report notes.
In other words, success in this market is no longer about being in property — it is about being in the right property, in the right place, at the right time.
And increasingly, that place may not be where you expect.
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