Kiama NSW Property Investment

THE MARKET

Kiama has compounded at 10.6%/yr over 5 years — a house that cost $906,391 in 2021 is worth $1,500,000 today. Properties are sitting on market for 40 days (roughly balanced conditions). At the same growth rate, today's median reaches $2,482,372 by 2031.

- **Median house:** $1,500,000 | **Units:** $406,715 - **Gross yield:** 2.8% | **Net yield:** 1.3% - **5yr price CAGR:** 10.6%/yr | **3yr forecast:** 12.0%/yr - **Population:** 33,604 | **Owner-occupier rate:** 36% | **Affluence:** Very High

- **Supply pipeline:** Moderate — Strong population growth likely attracting new development approvals

RENTAL SNAPSHOT

- **Vacancy:** 2.1% (improving) | **Rental demand:** High - **Median weekly rent:** $800/wk | **Days on market:** 40 (stable) - Balanced market — vacancy manageable but monitor trend.

SHORT-TERM RENTAL

- **Median nightly rate:** $195/night | **Occupancy:** 68% - **Estimated annual STR gross:** ~$48,399/yr - **vs long-term rent:** $41,600/yr (+16% STR premium — factor in higher management costs)

INFRASTRUCTURE & CATALYSTS

- No major confirmed infrastructure projects on record. - **Transport:** Well-connected inner-city location

BULL CASE

If Kiama maintains 3%+ annual growth and vacancy stays below 1.5%, median prices could reach $1,725,000 within 3 years with yields compressing slightly as capital values rise.

BEAR CASE

A market correction or interest rate shock could see prices in Kiama pull back 10-15% from $1,500,000, with vacancy rising to 3.8% and rental yields softening as tenants gain leverage.

KEY RISKS

- No significant risk factors identified for this suburb

COMPARABLE MARKETS

- **Wollongong** (NSW): $1,300,000 median, 2.4% yield, 4.0% 1yr growth - **Newcastle** (NSW): $1,578,000 median, 2.8% yield, 19.1% 1yr growth - **Marsden Park** (NSW): $1,200,000 median, 3.5% yield, 5.8% 1yr growth

THE PLAY

Kiama presents a compelling investment opportunity. The combination of solid fundamentals and high rental demand supports entry at current price levels. Proceed with due diligence on specific properties. Target gross yields above 2.8% and prioritise properties with value-add potential. Consider timing entry around the current growth phase of the market cycle.

- Entry range: $1,350,000 – $1,650,000 - Minimum gross yield to target: 4.5% - Watch signal: vacancy dropping below 2% and days on market falling below 35

This analysis is for informational purposes only and does not constitute financial, legal, or investment advice. Seek professional advice before making investment decisions.