Sydney's average gross rental yield is about 3.3% in 2026, and units return far more than houses. Units average around 4.4% and houses around 2.9%, so any Sydney property yielding 5% or more is a strong result.
Quick answer
- Average Sydney yield: 3.3% across all dwellings (Cotality, 2026)
- Units vs houses: about 4.4% for units and 2.9% for houses (OpenAgent)
- Highest-yield Sydney suburb: Haymarket apartments at 6.6%
- Highest-yield NSW areas: regional towns such as Coonamble and Nyngan, above 9% for houses
Yields are rising in 2026 because rents keep climbing while Sydney values fall. That makes this a better year to look for yield than 2024, when we first published this guide. It also comes with new tax rules for investors, covered below.
This guide covers how to calculate yield, the top-yielding Sydney and NSW suburbs, and how to finance a high-yield investment property.
How to calculate rental yield
Gross yield is the annual rent as a percentage of the purchase price. Net yield subtracts your running costs first, and it is the number that affects your cash flow.
Gross yield = (weekly rent × 52) ÷ purchase price × 100
Net yield = ((weekly rent × 52) − annual costs) ÷ purchase price × 100
Worked example: a $700,000 Sydney unit renting for $600 a week
| Item | Amount |
|---|---|
| Annual rent ($600 × 52) | $31,200 |
| Gross yield | 4.5% |
| Strata levies | $5,000 |
| Council and water rates | $2,500 |
| Landlord insurance | $600 |
| Property management (about 6.6% of rent) | $2,060 |
| Maintenance allowance | $1,500 |
| Total annual costs | $11,660 |
| Net yield | 2.8% |
The example costs are illustrative, so use real strata and council figures for any property you consider. Net yield still excludes loan interest. To see what your repayments would be against the rent, try our mortgage repayment calculator.
The gap between gross and net matters most for units. Strata levies can take a big share of the higher gross yield that units offer.
Sydney rental yields in 2026
Sydney has the lowest gross yield of any capital city, at about 3.3%, but it is rising. Rents are still climbing while home values fall, which pushes yields up.
| Measure | Sydney, 2026 |
|---|---|
| Gross yield, all dwellings | 3.3% |
| Gross yield, units | about 4.4% |
| Gross yield, houses | about 2.9% |
| Median weekly rent (June 2026) | $841 |
| Rental vacancy rate (June quarter) | 1.9% |
| Rental listings vs five-year average | 24.1% below |
Sources: Cotality Quarterly Rental Review, Q2 2026; unit and house split from OpenAgent.
Sydney remains Australia's most expensive rental market. Cotality puts its median rent about $200 a week above Melbourne's. With listings well below normal, landlords face little vacancy risk right now.
The unit advantage has held since our 2024 edition. Back then, SQM Research had Sydney units at 4.3% and houses at 2.8%. Units are cheaper to buy relative to the rent they earn, so they yield more, though houses have usually delivered stronger long-term capital growth.
Sydney suburbs with the highest rental yields in 2026
Sydney's best yields are in apartments, led by Haymarket at 6.6%. Every top apartment market out-yields every top house market, and most sit in the CBD fringe or the Parramatta corridor.
Top Sydney suburbs for unit yields
| Suburb | Median price | Median weekly rent | Gross yield |
|---|---|---|---|
| Haymarket | $980,000 | $1,250 | 6.6% |
| Sydney Olympic Park | $652,500 | $810 | 6.5% |
| Granville | $515,000 | $630 | 6.4% |
| Harris Park | $508,000 | $600 | 6.1% |
| Pendle Hill | $500,000 | $590 | 6.1% |
Top Sydney suburbs for house yields
| Suburb | Median price | Median weekly rent | Gross yield |
|---|---|---|---|
| Pyrmont | $1,608,000 | $1,283 | 4.1% |
| Macquarie Links | $1,288,000 | $1,000 | 4.0% |
| Werrington | $865,000 | $650 | 3.9% |
Source: OpenAgent analysis of Domain data, 12 months to June 2026. Suburbs needed at least 10 sales and 10 rent records to qualify.
Macquarie Links featured in our original 2024 list of suburbs to watch for long-term yield. It now ranks among Sydney's top house yields.
Four of the five top unit markets have medians of $652,500 or less. That puts them within reach of many first-time investors, especially those using equity from an existing home as a deposit.
Rental yields in the suburbs we work in
Yields vary widely across Sydney, even between neighbouring suburbs. Here is how the areas Home Loans Hub works in most compare.
Eastern Suburbs: Randwick and Coogee
Eastern Suburbs houses are a capital growth play, not a yield play. Randwick houses return about 2.0%, while its units return about 3.7%, with a median unit rent of $880 a week (Your Investment Property, CoreLogic data, 12 months to March 2026). Demand from UNSW students and staff and the Prince of Wales Hospital precinct keeps the unit rental market deep and steady.
If you're weighing an Eastern Suburbs investment, talk to a mortgage broker in Randwick about structuring the loan around a lower yield. For beachside units, our Coogee mortgage broker page covers purchase and refinance options.
St George: Kogarah, Rockdale and Carlton
St George sits in the middle of Sydney's yield range, with better entry prices than the Eastern Suburbs and good rail access to the CBD. Unit stock near Kogarah and Rockdale stations is popular with renters who commute.
Home Loans Hub is based in Kogarah, so this is our home turf. See our Kogarah mortgage broker, Rockdale mortgage broker and Carlton mortgage broker pages.
The North West
Our 2024 edition flagged Parklea, Stanhope Gardens and Kellyville Ridge for long-term unit yield. The North West suits investors who want newer stock, which matters more under the 2027 negative gearing changes covered below. Our investment loans page explains how we structure loans for these purchases.
Best rental yields in NSW beyond Sydney
The highest yields in NSW are in regional towns, where houses can return more than 9%. Low prices do the work: a $180,000 house renting for $325 a week yields far more than a Sydney property.
| Area | Property type | Median price | Median weekly rent | Gross yield |
|---|---|---|---|---|
| Coonamble | House | $180,000 | $325 | 9.4% |
| Nyngan | House | $225,000 | $400 | 9.2% |
| Wee Waa | House | $308,000 | $495 | 8.4% |
| Broken Hill | House | $250,000 | $370 | 7.7% |
| Scone | Unit | $367,500 | $470 | 6.7% |
| Crestwood (Queanbeyan) | Unit | $347,500 | $430 | 6.4% |
| Wyong | Unit | $427,500 | $515 | 6.3% |
Source: OpenAgent analysis of Domain data, 12 months to June 2026.
Wee Waa, Broken Hill and Crestwood also appeared in our 2024 list, so these regional markets have held their yields.
High regional yields come with real risks:
- Thin markets: fewer buyers and tenants mean longer vacancies and slower sales.
- Single-industry towns: rents in mining and farming areas move with those industries.
- Natural hazards: flood-prone areas such as parts of Lismore carry higher insurance costs.
- Lender limits: some lenders cap the loan size or require a bigger deposit in small towns.
That last point is where a broker helps most. Lender policies on regional postcodes differ, so the right lender can change what you're able to buy.
Ready to get started?
Book a chat with a Finance & Mortgage Broker at Home Loans Hub today.
Yield, growth and the 2027 tax changes
A high yield usually comes with slower capital growth, and in 2026 tax rules matter more than before. Weigh all three before choosing a suburb.
Yield vs capital growth
High-yield suburbs are rarely the fastest-growing ones. Buyers who want growth tend to pay more for houses on land, which pushes yields down. Decide first whether your goal is cash flow now or wealth over time.
Watch unit supply
New apartment supply can hold down rents and values. Sydney has little room to spread out, so future housing will mostly be apartments. If many similar units are approved near yours, rents and resale prices can suffer.
Before buying a unit, check the council's approved developments nearby. Also look at what makes your building different: size, parking, outlook or a smaller block.
Negative gearing changes from 1 July 2027
The 2026–27 Federal Budget announced that negative gearing will be limited to new builds from 1 July 2027. The change applies to established homes bought after 7:30pm on 12 May 2026. Properties held before then keep the current rules.
For established properties bought after that date, rental losses can't be offset against salary. They can still be offset against other residential rental income, and carried forward. The Budget also plans to replace the 50% capital gains tax discount with indexation for gains from 1 July 2027.
This makes yield more important. Cotality notes that Sydney gross yields remain well below the cost of borrowing, so most leveraged buyers will run a shortfall. A higher-yield property shrinks that shortfall, which matters more once you can't claim it against wages.
These rules were still being finalised in 2026. Confirm how they apply to you with your accountant before you buy.
How to finance a high-yield investment property
The loan structure can matter as much as the suburb. Deposit, loan type and lender choice all change your cash flow and borrowing power.
- Use equity instead of cash. If you own a home, its equity can fund the deposit and costs. Our investment loans page explains how this works.
- Consider a smaller deposit. Borrowing more than 80% usually means paying Lenders Mortgage Insurance (LMI). That can still make sense if it gets you into the market sooner. A guarantor loan can help you avoid LMI.
- Choose interest-only or principal and interest. Interest-only lowers repayments and improves cash flow in the early years. Principal and interest builds equity faster.
- Use an offset account. Keeping savings in an offset linked to your home loan, not the investment loan, can reduce non-deductible interest.
- Compare lenders on rental income. Lenders count a different share of rent when assessing what you can borrow. Check yours with our borrowing capacity calculator.
- Self-employed investors can use alternative income verification with some lenders. Ask us which lenders suit your situation.
Already own an investment property? Refinancing to a sharper rate or releasing equity can fund your next purchase.
Ready to invest?
A higher yield is only half the story; the right loan decides whether the numbers work. Home Loans Hub is an independent Kogarah-based broker with access to more than 40 lenders. We can compare how each lender treats rental income and structure the loan for cash flow.
Book an appointment with a mortgage investment expert or learn more about Home Loans Hub.
This article is general information only and doesn't consider your personal circumstances. Yields change monthly, so check current data before buying. Home Loans Hub is Credit Representative Number 557885 of Australian Credit Licence Number 384704.
Frequently Asked Questions
What is a good rental yield in Sydney?
Anything above 5% gross is strong for Sydney, where the average is about 3.3%. For units, 4.5% or more is above average. For houses, 3.5% or more is good.
Which Sydney suburb has the highest rental yield?
Haymarket apartments lead at about 6.6% gross, followed by Sydney Olympic Park and Granville. For houses, Pyrmont and Macquarie Links lead at around 4%.
Do units or houses have better rental yields in Sydney?
Units do, at about 4.4% compared with 2.9% for houses. Houses have historically delivered stronger capital growth.
What is the average rental yield in Sydney?
About 3.3% across all dwellings in 2026, the lowest of any Australian capital city. Yields have been rising as rents grow and values fall.
Where are the best rental returns in NSW?
Regional towns such as Coonamble, Nyngan and Wee Waa return 8–9% or more on houses. Those markets carry more risk, including thinner demand and reliance on one industry.
What's the difference between gross and net rental yield?
Gross yield is annual rent divided by the purchase price. Net yield subtracts costs such as strata, rates, insurance and management first.
Can I still negatively gear an investment property?
For properties held before 12 May 2026, yes. For established homes bought after that date, losses can't be offset against salary from 1 July 2027. New builds keep negative gearing. Check your situation with an accountant.
