The new analysis comes from Nicola McDougall, board member of the Property Investment Professionals of Australia (PIPA), and Kate Hill, a buyers agent at Adviseable.
They are also co-authors of property investment book The Female Investor.
This research comes as Australia's median house price tips over $1 million, along with many capital cities hitting the $1 million median house price mark.
Ms McDougall said many home buyers have turned to rentvesting, which means renting in a location they actually want to live, and investing in property in a more affordable location.
"Rentvesting has become a popular strategy for those who want to buy property but still [live] in an expensive real estate city such as Sydney or Melbourne," she said.
Ms Hill said renting is still more affordable than buying in desirable pockets of major cities, where home prices can easily exceed a million dollars.
"However, being a long-term renter without putting your money to work somehow has significant ramifications on your financial future as well as potentially causing hardship in retirement," she said.
With this in mind, below are the five rentvesting locations identified in their research, which was based on median house prices and rental vacancy rates.
See Also: The Top-20 Tenant-Friendly Suburbs Close to the CBD
1. Casey City Council (Melbourne)
The first location was Casey City Council. An example suburb within this Local Government Area (LGA) is Cranbourne - located approximately 51 kilometres from Melbourne - which has a median house price of $657,000 and a rental vacancy rate of 1%.
This is compared to Melbourne's $1.1 million median house price according to Domain's latest data.
Ms Hill said the Victorian Government identified several suburbs in the City of Casey that will play a major role in creating employment.
"The area’s population growth rate during recent census periods was higher than other rapidly growing outer Melbourne municipalities," she said.
"In fact, it’s growing at a rate more than twice the national average."
She also said it's local industries are diverse, meaning the area isn't dependent on only one industry which keeps the employment rate stable, and 60% of locals live and work in the area.
"[This] makes it an attractive lifestyle choice for families along with very affordable housing compared to most of Melbourne," Ms Hill said.
"The economic fundamentals of the area are very solid with continued price growth potential.
"In spite of developments to cater for the growing population, the growth charts are steady, vacancy rates are generally low, and rents have been increasing steadily."
2. Moreton Bay Regional Council (Brisbane)
The example suburb provided within the Moreton Bay LGA is Caboolture - located about 50 kilometres from Brisbane City - with a median house price of $445,000 and a rental vacancy rate of 0.70%.
Brisbane's median house price currently sits at $792,065 according to Domain, after exploding by 25.7% over the past year.
Ms McDougall said the surging population and myriad of major infrastructure projects, including a new university and hospital, see Moreton Bay tick many fundamental boxes for investors.
"A few years ago, Moreton Bay was classified as a priority growth area by the State Government, with its population predicted to hit half a million within about two decades," she said.
"One of the many major projects that is earmarked for the region is the development of Caboolture West, which is a growth precinct that boasts a plethora of attributes as well as affordable property."
Ms McDougall said Caboolture West will also benefit from an updated structure plan to deliver a new community, and that broader Caboolture West was identified as a major expansion area in the South East Queensland Regional Plan.
"Caboolture West is at the heart of a rapidly growing corridor north of Brisbane and is expected to eventually provide about 30,000 homes for around 70,000 people as well as generate close to 23,000 jobs," she said.
"The area will also have access to a number of primary and high schools as well as a TAFE and a private hospital."
3. City of Onkapariniga (Adelaide)
Morphette Vale is the example suburb listed in the research - sitting 25.1 kilometres from Adelaide - with a median house price of $430,000 and rental vacancy rate of 0.10%.
Adelaide's median house price is now over $731,000, where prices have risen by 27.5% annually according to Domain.
Ms Hill said the City of Onkaparinga has strong population growth forecasts, affordable property prices, low vacancy rates, and access to the central city.
"The area also has an attractive seaside location, with a track record of steady price growth and above-average rental yields in one of South Australia’s strongest population growth areas," she said.
"Over the next 20 years, the region is expected to receive an influx of 48,000 additional residents, making it one of Adelaide’s strongest growth areas."
Ms Hill said the location ticks a lot of boxes for investors because it has lifestyle, affordability, improved transport links, economic growth drivers, population growth, and proximity to major job hubs.
"For example, $1 billion has recently been spent on infrastructure, including the duplication of the Southern Expressway, the McLaren Vale overpass and the electrification and extension of the Noarlunga rail network to Seaford," she said.
"The outcome is excellent and easy accessibility between Adelaide and the Onkaparinga region, which also has a diverse range of industries to support the local economy."
4. City of Sterling (Perth)
Mirrabooka - located within Sterling and a short 12.7 kilometre journey to Perth - has a median house price of $385,000 and rental vacancy rate of 0.40%.
This can be compared to Perth's median house price of $612,348 according to Domain.
Ms McDougall said the City of Sterling is one of four Perth precincts that led the recovery of Perth's property market two years ago.
"The region offers a leisurely seaside lifestyle, [and is] home to the internationally renowned Scarborough Beach, as well as trendy bars and cafes that impart a youthful vibrancy [which] attracts a steady stream of 20 to 40 year olds," she said.
"Further adding to the region’s appeal are the shopping and education facilities, coupled with good transport links to the Perth CBD."
Ms McDougall said it is also the largest LGA in Perth, the largest LGA by population in the state, and the second largest employment district in Western Australia.
"Serious development began to occur there in the 1960s and 1970s as Perth expanded. The City of Stirling has also initiated a project to improve the suburbs of Balga, Dianella, Nollamara, Mirrabooka, and Westminster," she said.
"Generally, these suburbs can expect revamped town centres, improvements to transport, and higher-density housing."
5. Penrith City Council (Sydney)
Penrith City Council is located in Western Sydney, which is considered Australia's third largest economy.
An example suburb within Penrith's LGA is Kingswood - located 51.2 kilometres from Sydney's CBD - with a median house price of $790,000 and rental vacancy rate of 1%.
This is compared to Sydney's median house price of $1.6 million, with Sydney being Australia's most expensive city, according to Domain.
Ms Hill said more than $22 billion is earmarked to be spent on transport infrastructure in the area over the next few years.
"Employment in Western Sydney is expected to grow 47% within the next 14 years," she said.
"Penrith City Council and business organisations have seized the moment and are implementing plans to create 12,000 jobs by 2036."
She said the decision to build Sydney's second airport at Badgerys Creek adds to the strategic appeal of Penrith, and that this was also a 'catalyst' for other large-scale projects in the area.
"These projects include the $5 billion Sydney Science Park and the Penrith Health and Education Precinct with trade training, a specialist science and mathematics high school, and a new university is to be established at North Bringelly," Ms Hill said.
"In the past two years, Penrith’s property market received a 'ripple effect' from the growth in Sydney, with most suburbs experiencing double-digit annual growth in median prices in recent years."
Ms Hill said the area is ideal for rentvesters and homebuyers alike that have a slightly higher budget.
"Penrith has a robust major infrastructure program, recorded population growth every year for decades, has diverse industries that keep its economy vibrant, as well as a more affordable property market that is incredibly active for both renters and buyers," she said.
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