Forest Hill Vic rental yield sits at approximately 3.6% to 4.2% gross for houses and 4.5% to 5.2% gross for units in 2026, making the suburb a quietly attractive pocket of Melbourne’s eastern corridor for income-focused investors. Read on for a full breakdown of what the numbers mean, what drives them, and how to position yourself to earn more from Forest Hill property.

What Is the Rental Yield in Forest Hill Vic Right Now?

Forest Hill is a leafy suburb in the Whitehorse local government area, roughly 17 kilometres east of the Melbourne CBD. It draws steady tenant demand from families, young professionals, and students accessing Deakin University’s Burwood campus nearby. That consistent demand underpins the suburb’s rental performance year after year.

Gross Yield: Houses

CoreLogic data for the 12 months to mid-2026 points to a median house price of approximately $1,050,000 in Forest Hill, with a median weekly rent of around $730. Applying the standard gross yield formula (annual rent divided by purchase price, multiplied by 100) gives:

• Annual rent: $730 x 52 = $37,960
• Gross yield: $37,960 / $1,050,000 x 100 = ~3.6%

Gross Yield: Units

Units and townhouses deliver a noticeably better income return. CoreLogic and SQM Research figures indicate a median unit price of approximately $650,000 and a median weekly unit rent of close to $580:

• Annual rent: $580 x 52 = $30,160
• Gross yield: $30,160 / $650,000 x 100 = ~4.6%

Net Yield: What You Actually Keep

Net yield accounts for ongoing ownership costs: council rates, property management fees, insurance, maintenance, and any body corporate levies. A reasonable deduction benchmark for Melbourne investment properties sits between 1.5% and 2.0% of the gross yield. Applying that to Forest Hill:

• Net house yield: approximately 1.8% to 2.1%
• Net unit yield: approximately 2.6% to 3.2%

The ATO allows investors to claim deductions on interest expenses, depreciation, and eligible property costs, which can meaningfully improve after-tax cash flow. According to the ATO’s most recent investor tax statistics, over 2.2 million Australians hold at least one investment property and claim net rental deductions each year, underlining just how mainstream property investing remains as a wealth-building strategy.

What Do the Broader Numbers Say About Forest Hill Vic Property?

Context matters when assessing any single suburb. According to CoreLogic’s June 2026 suburbs report, Melbourne’s eastern corridor has recorded median house price growth of roughly 4.8% over the past 12 months, with Whitehorse LGA tracking slightly above that at closer to 5.1%. Forest Hill benefits from this broader momentum while still sitting at a more accessible entry point than neighbouring Box Hill or Blackburn.

SQM Research’s vacancy rate tracker shows Forest Hill’s rental vacancy sitting at approximately 1.4% as at Q2 2026, comfortably below Melbourne’s metro average of around 1.9%. A vacancy rate below 2.0% is generally considered a landlord’s market, supporting rent growth and minimising the risk of prolonged empty periods between tenancies.

For investors comparing options across the city, our rental yield Melbourne guide benchmarks Forest Hill against other high-performing suburbs and shows where the suburb ranks within Melbourne’s broader investment landscape.

How Does Forest Hill Compare to Nearby Suburbs?

• Box Hill: Median house price ~$1,180,000, gross house yield ~3.3%
• Nunawading: Median house price ~$980,000, gross house yield ~3.8%
• Vermont: Median house price ~$1,020,000, gross house yield ~3.7%
• Forest Hill: Median house price ~$1,050,000, gross house yield ~3.6%

On a pure house yield basis, Forest Hill sits mid-table for the eastern suburbs. However, its unit market stands out, with gross yields approaching or exceeding 5% for well-positioned stock, which is above the Melbourne metropolitan unit average of approximately 4.3% (CoreLogic, June 2026).

What Are the Key Considerations for Investing in Forest Hill Vic?

Raw yield figures are a starting point, not the whole story. Investors targeting Forest Hill should weigh up the following factors before committing capital.

1. Stock Type and Depreciation

Newer townhouses and units constructed after 1987 attract the highest depreciation deductions under ATO Division 43 and Division 40 rules. A quantity surveyor’s depreciation schedule on a post-2000 Forest Hill unit can generate between $5,000 and $12,000 in claimable deductions in the first full financial year alone, significantly improving after-tax cash flow beyond the headline net yield figure.

2. Tenant Profile and Lease Stability

Forest Hill’s proximity to Deakin University Burwood, Eastlink, and the Ring Road creates a mixed tenant base of families seeking school catchment access (Forest Hill College being a key drawcard) and professionals commuting to Box Hill or the CBD. Family tenants typically sign longer leases, reducing turnover costs and vacancy risk.

3. Capital Growth vs. Yield Trade-off

Investors weighing Forest Hill against inner-city alternatives should note that capital growth and rental yield often sit in inverse relationship across Melbourne. Inner suburbs like Northcote and Fitzroy tend to offer stronger capital growth histories but lower gross yields. Forest Hill offers a more balanced profile. If you are exploring inner-north options as well, the rental yield Northcote breakdown provides a useful comparison point.

4. Body Corporate Costs for Units

Unit investors in Forest Hill should budget carefully for body corporate (owners corporation) levies, which range from approximately $1,200 to $4,500 per year depending on the building’s size, age, and shared amenities. These costs directly reduce net yield and should be confirmed before any purchase.

5. Interest Rate Environment

The RBA’s most recent rate decision cycle has seen the cash rate settle at 3.85% as at July 2026 (RBA, July 2026). Investors using interest-only loans should model repayments at a 3% buffer above the current rate (as APRA requires lenders to apply) to stress-test their cash flow position before committing.

For investors considering a portfolio approach, Investment Properties Melbourne curates high-yield units and townhouses across Melbourne’s best-performing pockets, including the eastern suburbs.

How Does Collings Real Estate Help Forest Hill Investors?

Collings Real Estate has been working with Melbourne property investors for decades, combining on-the-ground sales expertise with dedicated property management. Our team understands that the difference between a good Forest Hill investment and a great one often comes down to buying the right asset at the right price, then managing it with precision.

Property Management

Our property management division actively manages rental properties across Melbourne’s eastern and inner suburbs. We focus on minimising vacancy, achieving market-leading rents, and keeping landlords informed with transparent reporting. For Forest Hill landlords, that means faster leasing, rigorous tenant selection, and proactive maintenance management that protects the long-term value of your asset.

Off-Market Access

Some of the best-yielding investment stock in Forest Hill and surrounding suburbs never reaches the public portals. Collings maintains an active pipeline of off-market opportunities sourced through our vendor network. Registering on our investor portal gives you priority access to these listings before they are offered to the broader market.

Strategic Investment Advice

Every investor’s situation is different. A retiree seeking passive income has different priorities to a 35-year-old building a portfolio for future financial independence. Our property strategists work through your goals, current position, and risk tolerance to identify whether a Forest Hill unit, townhouse, or house best fits your strategy, and what yield you can realistically expect after all costs are accounted for.

Talk to a Collings property strategist today. Call us on 03 9486 2000, email info@collings.com.au, or visit us at 230 Waterdale Road, Ivanhoe, VIC 3079. You can also register for priority access to off-market investment opportunities through our investor portal.

Frequently Asked Questions About Forest Hill Vic Rental Yield

What is the average rental yield in Forest Hill Vic?

Based on CoreLogic and SQM Research data for mid-2026, gross rental yield in Forest Hill averages approximately 3.6% for houses and 4.6% for units. Net yields after ownership costs sit lower, at roughly 1.8% to 2.1% for houses and 2.6% to 3.2% for units.

Is Forest Hill a good suburb to invest in?

Forest Hill offers a combination of stable tenant demand, a vacancy rate of approximately 1.4% (below Melbourne’s metro average), and a unit market delivering above-average gross yields. It suits investors seeking a balance of income return and moderate capital growth in Melbourne’s eastern corridor.

What is the median rent in Forest Hill Vic?

As at mid-2026, the median weekly rent in Forest Hill is approximately $730 for houses and $580 for units, according to CoreLogic suburb data. Rents have grown at roughly 4% to 5% annually over the past two years, reflecting tight vacancy conditions across the Whitehorse LGA.

How do I calculate rental yield for a Forest Hill property?

Gross rental yield is calculated by dividing the annual rent by the purchase price and multiplying by 100. For example, a unit renting for $580 per week ($30,160 per year) purchased for $650,000 returns a gross yield of 4.64%. Deduct ongoing costs (management, rates, insurance, maintenance) to arrive at net yield.

Does negative gearing apply to Forest Hill investment properties?

Yes. If your rental income is less than your deductible ownership costs (including loan interest and depreciation), you can offset the shortfall against other income under ATO negative gearing rules. Many Forest Hill investors, particularly those holding houses at lower gross yields, use negative gearing to reduce their tax liability while building long-term capital value.

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