Surprise top market for investors

In the latest Herron Todd White month in review report, valuer Hayden Lynam said investor activity in Townsville had remained strong in the past six months.

“Despite national conversations around interest rates and economic uncertainties, Townsville offers a compelling alternative narrative,” Mr Lynam said.

“The city’s diverse economy, anchored by sectors including resources, defence and healthcare, provides a degree of resilience that many other markets lack.

“Coupled with relative affordability compared to southern capitals and consistently healthy rental yields, Townsville presents a value proposition that’s hard to ignore.”

Latest data from PropTrack showed the median unit price in Townsville was $340,000 in February and the average rental yield was 6.5%.

The median house price in Townsville was $536,500 and the average rental yield was 5.14%.

Mr Lynam said traditionally, investor stock in Townsville mainly consisted of detached houses, however, recent trends pointed to a noticeable increase in investor interest in units.

'The hottest investor suburbs for 2025': youtube.com/mortgagechoice

“This shift likely stems from affordability considerations and the potential for higher rental yields compared to houses,” he said.

“Duplexes and triplexes are also gaining traction as increasingly attractive investment options.

“While the traditional investor demographic comprised local residents and interstate buyers, we’re now seeing growing interest from investors who are priced out of more expensive markets.”

Mr Lynam said investors targeting detached houses were buying in the $400,000 to $700,000 price range in inner-city areas, targeting rental income and the potential for long-term capital growth.

“The 12-month outlook for detached investor-level housing in these areas is cautiously optimistic, with steady rental demand expected and potential for moderate capital growth,” he said.

Mr Lynam said investors chasing units, apartments and townhouses were looking in areas such as the city centre, South Townsville and North Ward.

This three-bedroom house in the Townsville suburb of Railway Estate is on the market for a tempting $399,000. Picture: realestate.com.au

“Price points generally range from $250,000 to $450,000, with yields potentially reaching 5-6% or even higher in certain cases,” he said.

“While capital growth might be more conservative compared to detached houses, the rental yields present a compelling proposition.

“The outlook for attached housing remains positive, with continued demand anticipated from students, young professionals and those seeking low-maintenance living.”

Lynam said while national economic conditions were always a factor, Townsville’s unique local dynamics, including a resilient economy, ongoing infrastructure development and appealing rental yields, continued to drive strong investor activity.

“The overall outlook for the Townsville property market in 2025 remains positive, with continued growth anticipated,” he said.