Bodalla NSW Property Investment

## 1. Investment Verdict Hold – the key figure is the median house price of around $850,000. At this price level the current rental return is modest, so the suburb does not present a clear upside for a fresh purchase but still offers enough yield to justify holding existing assets.

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## 2. Market Overview - Median house price: approximately $850,000 - Median unit price: $428,003 (exact)

*Growth trend & days on market* – not supplied in the data set, so we cannot comment on recent price momentum or how quickly properties are selling.

Signal: With a median house price near $850k and no evidence of rapid price appreciation, the market appears relatively stable. Buyers should expect a measured price environment, while sellers may need to price competitively to attract interest.

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## 3. Rental Market - Median weekly rent: $480 (exact) - Vacancy rate: not provided - Gross yield (house): - Annual rent = $480 × 52 = $24,960 - Gross yield = $24,960 ÷ $850,000 ≈ 2.9 %

• Demand rating: Investment Scorecard = 52 / 100 (moderate demand)

Implication: A 2.9 % gross yield is low for a long‑term rental (LTR) investment, indicating limited cash‑flow upside. The moderate demand score suggests occupancy should be stable, but the low yield means investors need either strong capital growth expectations or a lower purchase price to improve returns.

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## 4. Short‑Term Rental Opportunity - STR nightly rate: not supplied - Occupancy rate: not supplied - Estimated annual STR revenue: cannot be calculated without nightly rate or occupancy data.

Conclusion: With no STR data, we cannot assess whether short‑term rentals would outperform the modest 2.9 % LTR yield. Until local STR performance is known, LTR remains the safer default.

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## 5. Infrastructure & Growth Drivers No specific projects, transport upgrades, or major employers are listed in the data. Consequently, we cannot identify any concrete demand catalysts or constraints beyond the existing moderate demand score.

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## 6. Bull Case If the suburb experiences modest price growth and rental uplift:

• Assumed price growth: +5 % per annum (a typical modest uplift for stable regional markets)
• - New median house price ≈ $850,000 × 1.05 = $892,500

• Assumed rent growth: +3 % per annum (aligned with CPI)
• - New median weekly rent ≈ $480 × 1.03 = $494
• - New gross yield ≈ ($494 × 52) ÷ $892,500 ≈ 2.9 % (still low, but capital gains would drive returns).

The upside hinges on capital appreciation rather than cash flow.

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## 7. Risks | Risk | Detail (with numbers) | |------|-----------------------| | Vacancy risk | No vacancy data; moderate demand score (52/100) suggests occupancy could slip if rent expectations rise. | | Single‑employer dependency | No employer data supplied; if the local economy relies on a single large employer, any downturn could pressure both rents and prices. | | Supply pipeline | No information on new housing supply; an influx of new units could push yields lower than the current 2.9 %. | | Rate sensitivity | At a purchase price of ~$850k, a 1 % rise in interest rates adds roughly $8,500 to annual financing costs (assuming a $850k loan), further squeezing the thin 2.9 % gross yield. |

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## 8. The Play - Entry price range: roughly $800,000 – $900,000 (centered on the approximate median). - Minimum yield target: aim for ≥ 3 % gross (the current 2.9 % is borderline; a lower purchase price or higher rent would be needed). - Watch signals: 1. Any announced infrastructure or tourism projects that could boost STR demand. 2. Evidence of rent growth above 3 % YoY. 3. Changes in the local employment base (e.g., new major employer). 4. Shifts in the Reserve Bank’s cash‑rate that materially affect borrowing costs.

• Recommended strategy: Hold existing positions while monitoring for the above signals. If a clear catalyst emerges (e.g., a new tourism development that lifts STR rates), consider repositioning to short‑term rentals. Otherwise, maintain the asset for capital‑preservation rather than cash‑flow generation.