How to Find Positively Geared Properties in Australia (2026)

A positively geared property — one where rental income exceeds all expenses — is the holy grail for many investors. It generates income from day one, doesn't require you to fund a shortfall from your salary, and lets you scale a portfolio without hitting serviceability walls.

Here's how to find them in 2026.

What Does Positively Geared Actually Mean?

A property is positively geared when: Annual rent > Annual mortgage repayments + All expenses

This is harder to achieve than most people expect. Even at 5.5% gross yield, when you factor in a 6.2% interest rate on an 80% loan plus expenses, many properties still run at a small loss. True positive cashflow typically requires either a gross yield above 6%, a large deposit (reducing loan size), or a very low-expense property (no strata, low rates area).

The Positive Gearing Formula

Quick test: Does gross yield > (loan-to-value ratio × interest rate) + 1.5%?

Example with 80% LVR at 6.2% interest: 80% × 6.2% = 4.96% + 1.5% expenses buffer = 6.46% needed for positive cashflow. So you need a suburb with gross yield above 6.46% to be comfortably positive.

With a larger deposit (60% LVR): 60% × 6.2% = 3.72% + 1.5% = 5.22% needed. Now Darwin (6.5%), Salisbury (6.0%), Cairns (5.9%) all work.

Where to Find Positively Geared Properties in 2026

Darwin, NT — 6.5% Yield

Darwin is Australia's most accessible positive gearing market. At 6.5% gross, a $575,000 property with a 20% deposit ($115,000) generates positive cashflow even at today's interest rates. The catch is limited capital growth — Darwin is a yield play, not a growth play.

Salisbury, SA — 6.0% Yield

Salisbury at 6.0% yield on $500,000 is close to neutral with an 80% LVR and positive with a larger deposit. Adelaide's broader market momentum adds a growth dimension that Darwin lacks, making Salisbury arguably the best risk-adjusted positive gearing market in Australia right now.

Cairns, QLD — 5.9% Yield

Cairns at 5.9% crosses into positive territory with a 30%+ deposit. Strong tourism and interstate migration keep vacancy below 2%.

Regional Queensland

Mackay, Townsville, Gladstone, and Rockhampton all offer 5.0–6.5% yields depending on property type. Resource sector towns can deliver exceptional yield but require careful timing relative to commodity cycles. Townsville at 5.0–5.5% is the most stable of the regional QLD markets, with a diversified economic base (military, university, healthcare, tourism).

Property Types That Support Positive Gearing

• Houses over units: No strata fees — significantly better net yield. A 5.5% gross house typically beats a 6.0% gross unit on net yield.
• Older stock: Lower purchase price relative to rent. A 1970s fibro house in Cairns may yield 6.5%+ while a new townhouse in the same suburb yields 5%.
• Multi-tenancy: Dual-occupancy (dual key) properties or properties with a granny flat can generate $100–$200/week extra rent with modest extra cost.
• Commercial residential: Some regional town main-street commercial/residential properties deliver 7–9% yield, though they have different risk profiles.

The Positive Gearing Trap to Avoid

Very high yields (8%+) are often a warning sign. Check: Is vacancy high? Is the town population declining? Is the property poorly maintained? Is it in a flood zone? A 9% yield property with 20% vacancy and $30,000 in deferred maintenance is not a positive gearing win — it's a cashflow negative disaster waiting to happen.

Not financial advice. Always consult a qualified adviser before investing.