Northcote Delivers 6.8% Rental Yields, Leading Regional Investment Returns

Northcote posted the highest rental yield among local suburbs in the June quarter, reaching 6.8 percent on properties valued near the median of $825,000.

Investors have shifted focus to Northcote after interest rate cuts announced in May began to lift borrowing capacity while tenant demand stayed steady. The suburb’s mix of older weatherboard homes and newer townhouses on smaller blocks appeals to both families and young professionals who work at nearby employment hubs.

Streets drawing steady tenants

Clarke Street and Merri Parade continue to attract renters fastest, with vacancy rates below 1.5 percent. Properties within walking distance of the Northcote Community Centre and the High Street shops lease within two weeks on average. Local agents report that two-bedroom units on these streets command weekly rents between $620 and $680, supporting the elevated yield figures.

Numbers behind the yield

CoreLogic data released on 7 July showed Northcote’s gross yield at 6.8 percent, ahead of every other suburb tracked in the same report. Median house prices rose 3.2 percent over the past twelve months to $825,000, while median rents climbed to $645 a week. Investors who bought on Merri Parade in late 2024 at $790,000 now receive $650 weekly, equating to an annual return of roughly $33,800 before costs.

Buyers considering entry should check current listings on Clarke Street and inspect comparable sales from the past six months at the Northcote Library planning counter. Engaging a local property manager early and confirming body corporate fees on any townhouse purchases will help lock in the yield before the next rent review cycle in October.

This article is general information only and is not personal financial or investment advice. Consider your own circumstances and seek licensed professional advice before making financial decisions.