Top 7 Newcastle Suburbs with the Best Rental Yields Heading into 2026

In 2025, Newcastle’s property market has held firm, bolstered by infrastructure growth, regional migration, and a resilient local economy. As we approach 2026, savvy investors are searching for the best rental yield suburbs in Newcastle, NSW, areas where rental returns remain strong despite market fluctuations.

Strong rental yields often come from suburbs with high tenant demand, good public transport, proximity to hospitals and universities, and diverse housing options. These high-performing rental pockets are ideal for positively geared investors, first-time landlords, and anyone looking to secure consistent rental income with long-term growth potential.

With market conditions shifting, Mortgage Brokers Newcastle can help you navigate a wide range of lending options. Whether you're investing in a unit or house, our local team offers expert advice and tailored loan solutions to help you succeed.

Now, let’s dive into the key suburbs set to lead in rental returns by 2026.

Key Takeaways

• Newcastle’s rental market remains strong heading into 2026, driven by lifestyle appeal and infrastructure growth.
  
  
• Suburbs with the best rental yields in Newcastle NSW share traits like high tenant demand, accessibility, and housing diversity.
  
  
• Mayfield, Waratah, Jesmond, and others stand out for their consistent rental performance.
  
  
• These suburbs are not general investment leaders but are strictly high-yield rental pockets.
  
  
• Mortgage Brokers Newcastle provides expert support to help you finance a property in these areas.

Top Suburbs with High Rental Yield in Newcastle, NSW

1. Mayfield

Mayfield is one of Newcastle’s most active high-return rental pockets, loved for its city-fringe location and affordability. Just 10 minutes from the CBD, it continues to attract young professionals and students alike. 

The suburb benefits from close proximity to the University of Newcastle and Calvary Mater Hospital, with frequent public transport and local amenities like cafes, supermarkets, and green spaces. With revitalisation projects breathing new life into the area and vacancy rates remaining low, Mayfield is showing all the signs of a suburb where rental yields could strengthen further in 2026.

• Median Rental Yield: 3.7% to 4% (houses); 4.47% to 4.5% (units)
  
  
• Median House Price: $975,000
  
  
• Median Unit Price: $735,000
  
  
• Median Weekly Rent: $680 (houses); $600 (units)
  
  
• Vacancy Rate: 0.85% to 0.9%
  
  
• Rental Demand Index: High
  
  
• Infrastructure Development: Local town centre upgrades, new mixed-use developments
  
  
• Growth Drivers: University proximity, gentrification, inner-city access
  
  
• Population Growth: Steady
  
  

2. Waratah

Waratah stands out among strong-yielding suburbs in Newcastle, thanks to its balanced mix of family homes and student rentals. It’s just a stone’s throw from the University of Newcastle, John Hunter Hospital, and major shopping centres. 

Families, professionals, and students all find appeal here, keeping tenant demand consistent. Reliable public transport, quality schools, and green spaces contribute to the suburb’s ongoing rental appeal, positioning it well for continued yield strength heading into 2026.

• Median Rental Yield: 3.6% to 4.13% (houses); 4.0% to 4.5% (units)
  
  
• Median House Price: $945,000
  
  
• Median Unit Price: $674,000
  
  
• Median Weekly Rent: $650 to $670 (housees); $520 - $570 (units)
  
  
• Vacancy Rate: 0.9%
  
  
• Rental Demand Index: Very High
  
  
• Infrastructure Development: Transport corridor improvements
  
  
• Growth Drivers: Hospital proximity, access to CBD, school zones
  
  
• Population Growth: Moderate
  
  

Unsure which loan suits your investment goals in Newcastle’s high-yield rental suburbs? Our local brokers compare and recommend smart loan options tailored to your strategy. Book a free loan assessment with our Newcastle mortgage brokers at (02) 4920 6468 or visit www.mortgagebrokersnewcastle.com.au.

3. Jesmond

Jesmond is a standout high-demand rental precinct due to its affordability and strategic location near the University of Newcastle. It’s known for its large student population, a major shopping centre, and frequent bus connections.

Units and townhouses are especially popular among tenants seeking low-maintenance homes close to essential amenities. With strong rental demand, consistently low vacancy rates, and competitive rent prices, Jesmond is well-placed to deliver reliable yield returns as we move into 2026.

• Median Rental Yield: 3.76% (houses); 5.32% (units)
  
  
• Median House Price: $745,000
  
  
• Median Unit Price: $442,500
  
  
• Median Weekly Rent: $530 (houses); $450 (units)
  
  
• Vacancy Rate: 1.0%
  
  
• Rental Demand Index: Very High
  
  
• Infrastructure Development: Student housing, shopping precinct expansion
  
  
• Growth Drivers: University access, affordability, tenant mix
  
  
• Population Growth: High
  
  

4. Adamstown Heights

Adamstown Heights offers excellent yield potential with its mix of established homes and newer developments. It’s ideally positioned between Westfield Kotara and Charlestown Square—two of the region’s major retail hubs—and enjoys strong public transport connections, including its own train station. 

Families and professionals are drawn to the suburb for its quiet streets, reputable schools, and overall convenience. With tenant appeal remaining high and infrastructure continuing to support growth, Adamstown Heights is shaping up as a suburb where rental yields could remain solid through 2026.

• Median Rental Yield: 3.51% (houses); 4.3% (units)
  
  
• Median House Price: $1,125,000
  
  
• Median Unit Price: $830,000
  
  
• Median Weekly Rent: $760 (houses); $560
  
  
• Vacancy Rate: 1.2%
  
  
• Rental Demand Index: High
  
  
• Infrastructure Development: Retail upgrades, public transport expansion
  
  
• Growth Drivers: Central location, school catchments, family appeal
  
  
• Population Growth: Steady
  
  

5. Charlestown

Charlestown is one of the largest commercial hubs in Newcastle outside the CBD, making it a consistently strong rental performance area. The suburb offers a broad mix of housing, from apartments to townhouses, appealing to local workers, young couples, and downsizers. 

With Charlestown Square, reputable schools, and easy access to the coast, it’s a practical choice for a wide range of tenants. As infrastructure continues to support both lifestyle and employment in the area, Charlestown is expected to maintain steady rental returns well into 2026.

• Median Rental Yield: 3.81% - 3.88% (houses); 4.36% (units)
  
  
• Median House Price: $900,000 - $982,500
  
  
• Median Unit Price: $620,000 - $650,000
  
  
• Median Weekly Rent: $650 - $700 (houses); $520 - $570 (units)
  
  
• Vacancy Rate: 1.4%
  
  
• Rental Demand Index: High
  
  
• Infrastructure Development: Medical precinct expansions
  
  
• Growth Drivers: Major retail hub, transport corridors, diverse housing
  
  
• Population Growth: Moderate
  
  

From planning to pre-approval, our Newcastle mortgage brokers guide investors and first-time buyers through every step of securing a home loan in Newcastle’s best rental yield suburbs. Call (02) 4920 6468 or head towww.mortgagebrokersnewcastle.com.au to learn more.

6. New Lambton Heights

Known for its proximity to the John Hunter Hospital, New Lambton Heights offers both rental stability and strong long-term performance. This leafy, elevated suburb appeals to healthcare professionals and families seeking a peaceful environment with easy access to the city.

Housing ranges from classic cottages to modern family homes, adding to its broad appeal. With consistently high tenant quality and limited rental supply, New Lambton Heights is likely to remain a reliable performer in the yield market moving into 2026.

• Median Rental Yield: 3.86% (houses); 4.3% (units)
  
  
• Median House Price: $1,190,000
  
  
• Median Unit Price: $750,000
  
  
• Median Weekly Rent: $850 (houses); $550 (units)
  
  
• Vacancy Rate: 1.0%
  
  
• Rental Demand Index: High
  
  
• Infrastructure Development: Hospital precinct upgrades
  
  
• Growth Drivers: Healthcare access, school zones, lifestyle appeal
  
  
• Population Growth: Low to steady
  
  

7. Fingal Bay

Fingal Bay, though technically part of Port Stephens, continues to attract attention for its strong rental returns and coastal lifestyle appeal. The suburb benefits from consistent tourism traffic, a relaxed beachside atmosphere, and a growing local services sector.

With demand for both long-term and short-stay rentals rising, investors are seeing reliable occupancy and healthy returns. As visitor numbers grow and infrastructure improves, Fingal Bay is poised to remain a high-performing rental area through 2026.

• Median Rental Yield: 3.16% (houses); 3.7% (units)
  
  
• Median House Price: $1,250,000
  
  
• Median Unit Price: $860,000
  
  
• Median Weekly Rent: $650 (houses); $590 (units)
  
  
• Vacancy Rate: 0.90%
  
  
• Rental Demand Index: High
  
  
• Infrastructure Development: Tourism enhancements, beachside upgrades
  
  
• Growth Drivers: Coastal living, short-term rental growth
  
  
• Population Growth: Moderate
  
  

Note: Property prices mentioned in this article are current estimates based on available data at the time of writing and are subject to change. For the latest figures, consult a licensed real estate agent or property professional.

Sources: Realestate.com.au, Domain, City of Newcastle, Infrastructure NSW Government 

Buying into a high-return suburb in Newcastle NSW? Our expert brokers help you choose the right lender, loan type, and structure to maximise rental income. Call (02) 4920 6468 or visitwww.mortgagebrokersnewcastle.com.au to book a free consultation.

FAQs

What is considered a good rental yield in Newcastle?

A rental yield above 4% is typically considered strong in Newcastle, especially when vacancy rates are low and rental demand is high.

Why is rental yield important for property investors?

It measures how much rental income a property generates relative to its purchase price. A high yield indicates stronger cash flow potential.

Are suburbs with high rental yields always good for capital growth?

Not always. High rental yield suburbs can offer strong cash flow but may not see rapid price growth. It depends on broader market factors.

How often does rental yield data change?

Rental yield figures can shift quarterly based on changes in property prices and rental income, as well as market supply and demand.

Is Newcastle a good place to invest in rental property right now?

Yes, Newcastle remains a strong choice for rental property investment. With ongoing infrastructure growth, rising tenant demand, and stable rental yields, it offers solid returns and long-term potential.

What factors affect rental yield in Newcastle suburbs?

Key factors include tenant demand, proximity to universities and hospitals, transport access, vacancy rates, and housing diversity. Suburbs with strong amenities and employment hubs tend to deliver higher yields.

Can I use equity to buy an investment property in Newcastle?

Yes, many investors use the equity in their current home to fund a new property. A broker can help assess your equity and structure a loan that supports your investment strategy.

What are the available investment loans to property buyers in Newcastle, NSW?

Property investors in Newcastle can access various loan options, including interest-only loans, principal and interest loans, fixed-rate or variable rate loans, and line of credit loans. Many also use equity from existing properties to fund new investments.

A mortgage broker can help tailor the right loan based on your investment goals, financial situation, and borrowing capacity.

Can Mortgage Brokers Newcastle help with investment loans?

Yes. They offer tailored lending solutions for investors, helping you access the most suitable home loan products for your strategy.

Thinking of Investing in a Newcastle High-Yield Suburb?

If you're planning to step into one of the best rental yield suburbs in Newcastle NSW, it’s important to pair your property strategy with the right financial support. From understanding borrowing capacity to accessing competitive loan products, the team at Mortgage Brokers Newcastle is here to help every step of the way.

As Newcastle's property landscape evolves heading into 2026, working with experienced brokers ensures you're making informed decisions that align with market trends and your long-term goals.

Whether you're buying your first investment property or expanding your portfolio, we can help tailor lending solutions to suit your needs.

Visitwww.mortgagebrokersnewcastle.com.au or call (02) 4920 6468 to speak with a local broker today. Let’s make your property investment journey a success.