Perth vs. Townsville: Which City is Better for Defence-Driven Property Investment (and what are the best established suburbs)?
When it comes to property investment, areas with a strong defence presence offer unique opportunities. The stability of military employment, government-backed housing initiatives, and ongoing infrastructure projects make cities like Perth and Townsville attractive options for investors. However, choosing the right city depends on various factors such as economic stability, rental demand, capital growth, and long-term investment potential.
In this comprehensive analysis, we examine Perth and Townsville through the lens of defence-driven property investment, focusing exclusively on well-established suburbs to provide the most reliable insights for investors.
- Defence Presence & Economic Stability
Perth, WA: A Strategic Defence & Economic Hub
Perth plays a crucial role in Australia’s defence strategy, particularly in naval operations. The city is home to several key defence assets:
- HMAS Stirling (Fleet Base West) – The largest naval base in Western Australia, supporting submarines, naval vessels, and fleet operations.
- RAAF Base Pearce – A critical training and operational hub for the Royal Australian Air Force.
- Henderson Naval Shipyard & Australian Marine Complex (AMC) – A major shipbuilding and maintenance facility supporting defence projects, including the AUKUS submarine program.
Beyond defence, Perth has a diversified economy driven by mining, technology, and infrastructure. This economic resilience provides stability for property investors, reducing reliance on defence employment alone.
Townsville, QLD: A Military Stronghold with Economic Dependencies
Townsville boasts one of Australia’s most concentrated military presences, making it a key location for defence-driven property investment. The city hosts:
- Lavarack Barracks – One of Australia’s largest Army bases, housing thousands of personnel and a range of operational units including the recent addition of tanks.
- RAAF Base Townsville – A significant air force installation supporting military and civilian operations.
- Defence Training & Support Facilities – With continual investments in infrastructure and personnel development.
However, Townsville’s economy is more dependent on defence spending, mining, and tourism. While this provides consistent rental demand, the market is vulnerable to policy changes and economic fluctuations.
- Property Market & Growth Potential
Perth:
- Market Strength: Strong demand driven by population growth and diverse industries.
- Vacancy Rates: Below 1% in key suburbs, ensuring strong rental returns.
- Capital Growth: Steady appreciation, especially in well-connected coastal and suburban areas.
- Defence Influence: Indirect but substantial, with personnel living across metro regions.
Townsville:
- Market Strength: More volatile, but defence presence ensures stable tenant demand.
- Vacancy Rates: Higher than Perth but gradually decreasing due to government spending.
- Capital Growth: Historically slower, with moderate appreciation driven by infrastructure projects.
- Defence Influence: Direct, as a significant portion of the population is linked to military employment.
- Established Suburbs for Defence-Driven Investment
Perth: Established Suburbs with Defence-Linked Demand
1️. Rockingham (Coastal, Defence-Oriented Community)
- Why? Popular with naval personnel due to proximity to Fleet Base West.
- Median House Price: ~$550K
- Rental Yield: ~5.5%
- Vacancy Rate: <1%
- Investment Potential: Strong rental market due to defence employment and ongoing infrastructure projects.
2️. Safety Bay (Adjacent to Rockingham, Strong Rental Demand)
- Why? Offers affordable housing near Rockingham, attractive to defence families.
- Median House Price: ~$580K
- Rental Yield: ~5%
- Vacancy Rate: <1%
- Investment Potential: Consistent demand due to proximity to HMAS Stirling and high-quality coastal lifestyle.
3️. Fremantle (Historical Naval Influence, High Demand Area)
- Why? Close to defence contractors and maritime industries.
- Median House Price: ~$900K
- Rental Yield: ~4.5%
- Vacancy Rate: <1.2%
- Investment Potential: High capital growth due to limited land supply and ongoing urban revitalization.
Townsville: Established Suburbs with Defence Housing Stability
1️.Douglas (Near Lavarack Barracks, Strong Rental Market)
- Why? Close to both Lavarack Barracks and James Cook University.
- Median House Price: ~$480K
- Rental Yield: ~6.5%
- Vacancy Rate: ~1%
- Investment Potential: High rental demand from both military personnel and university staff.
2️. Annandale (Premium Defence Housing Area, DHA Leases Available)
- Why? Attracts higher-end military tenancies and professionals.
- Median House Price: ~$550K
- Rental Yield: ~5.5%
- Vacancy Rate: <1%
- Investment Potential: Stability due to DHA lease availability and high-quality local amenities.
3️. Kirwan (Family-Friendly Area, Strong Military Presence)
- Why? Defence families prefer this suburb due to amenities, schools, and parks.
- Median House Price: ~$450K
- Rental Yield: ~6.5%
- Vacancy Rate: ~1.2%
- Investment Potential: Steady long-term rental demand and affordability make it a strong investment option.
- Investment Verdict: Perth vs. Townsville
| Factor | Perth | Townsville |
| Defence Presence | Strong (Navy, Air Force, Shipbuilding, Nuclear Technology) | Very Strong (Army, Air Force) |
| Economic Stability | Diverse (Mining, Tech, Defence) | Reliant on Defence & Government Spending |
| Capital Growth | Higher Long-Term Growth | Slower but Steady |
| Rental Yields | ~5-6% | ~6-7% |
| Vacancy Rates | <1% | ~1-2% |
| Risk Factor | Low (Diverse Economy) | Medium-High (Dependent on Defence & Govt) |
- For Long-Term Capital Growth & Low Risk: Perth (Rockingham, Safety Bay, Fremantle)
- For High Rental Yields: Townsville (Douglas, Annandale, Kirwan)
- For Defence-Focused Stability: Townsville (Lavarack Barracks proximity suburbs)
Final Recommendation
If you’re looking for long-term appreciation and economic resilience, Perth is the safer choice due to its diversified economy and strong infrastructure. Rockingham, Safety Bay, and Fremantle provide excellent investment potential for capital growth.
However, if you’re after higher rental yields with strong military demand, Townsville offers strong returns, especially in Douglas, Annandale, and Kirwan due to proximity to Lavarack Barracks.
Deeper insight to the pick?
The more stable of the two regions in defence terms will be Perth. The AUKUS project will be very difficult to rehouse in another region as the project is a more “infrastructure style of investment”, Perth will become the Nuclear technology hub for Australia.
Townsville on the other hand whilst home to the largest barracks in the country, the regiments based there have over the past 15 previously been based in Darwin, Adelaide, and Sydney they are highly mobile and can be moved quickly.
