Australia’s regional property markets are emerging as prime opportunities for investors, with new analysis highlighting regional towns as the top locations for strong investment potential.

REA Group has identified 37 key locations offering an ideal combination of affordability, capital growth, and high rental yields, essential factors for both property investors and mortgage lenders assessing risk and opportunity.

The analysis focused on suburbs already recognised as desirable and family-friendly.

The selected locations feature median property prices below national averages, capital growth above 4% for houses and 3.6% for units, and rental yields exceeding 4% for houses and 4.9% for units.

Of the 37 locations, 24 are house markets and 21 are unit markets. Queensland and South Australia lead the list in house market investment potential, providing significant opportunities for both investors and lenders.

Rockhampton, Queensland, ranks highest among house markets, offering the lowest median house price at $359,500, a remarkable 53% annual price growth, and the highest rental yield of 6.5%.

Other high-growth suburbs include Kirwan in Townsville, Gatton in Queensland’s Lockyer Valley, Munno Para West, and Andrews Farm in Adelaide—each recording over 20% price growth in the year to February.

Western Australia has six suburbs listed among the top house markets, New South Wales has two, and Tasmania has one.

In the unit market, Queensland leads with eight suburbs, followed by Victoria (4), Western Australia (3), Tasmania and the ACT (2 each), and New South Wales and South Australia (1 each).

Wright in the ACT and Mandurah in Western Australia top the unit market list with rental yields of 5.7%, presenting strong cash flow opportunities for investors and key considerations for lenders assessing financing strategies in these high-demand areas.