Aussie mining towns booming
The upswing in commodity prices will generate property investment opportunities in Australia's key resource regions over the next year, according to analysts.
However, the chances of solid returns in areas with large mining projects do not come without risks.
Demand for commodities was increasing and with it the need for workers and housing in mining towns, said RP Data analyst Cameron Kusher.
Accordingly, the north-west region of Western Australia and the coal-rich Bowen Basin in Queensland were likely to offer good opportunities for prospective property buyers, he said.
Average house prices in WA's north-west hit $910,000 in October 2008, slumped as much as 9.3 per cent in 2009, and went up again to just 3.3 per cent below their 2008 summit.
The Western Downs region of Queensland is another area likely to give opportunities. The district had a median house price of $263,000 and indicative gross rental yields of 5.6 per cent.
''We expect demand from China and India for resources to continue to be strong,'' Mr Kusher said.
According to him, there was a longer-term risk and buyers needed to do their homework on the area where they bought and pay attention to who was acquiring the resources and how long the demand would carry on.