Need an awful lot of these to retire I imagine?
Generally one sacrifices growth for yield and vice versa. Of course the recent boom made even the most regional of towns look great as they showed prices doubling in three years - what the spruikers didn't show was the flat growth in the 20 years prior.
I know that a well located middle class home will rent easily and well. After a few years rents are rising and the loan repayments are shrinking in relation to median incomes. The moral here is that if you can afford the negative outflow for the first 5-10 years it will all be gravy later on in life when you are sitting on a cash cow.
Maybe an illustration might help:
My folks bought wterfront in Sydney in the 70's for $48K. Was a huge loan back then when median incomes were $4K ish pa, a new Falcon was $2700 and wives generally didn't work.
But had they kept it, even if they stayed IO the whole time, they'd have a great income from it and Huuuuge capital growth.
Instead of chasing regional properties I am suggesting that the young investor needs to "just do it" then hold it.
How I wish I had never sold anything I bought....... shares included.....
If only young folks would listen to me they'd have it made