Traditional Residential Investment Properties and Specialist Disability Accommodation (SDA) – a Comparison
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Property investment remains a popular wealth-building strategy in Australia, with both traditional residential properties and Specialist Disability Accommodation (SDA) offering distinct benefits. Understanding how each performs in terms of rental income, yields and risk can help investors choose the right option for their goals.
A standard residential investment property—such as a house or apartment in a capital city—typically offers stable, long-term growth and broad tenant demand. Rental yields generally range between 3% and 5%, depending on location and property type. For example, a $700,000 house renting for $650 per week would generate approximately $33,800 per year, equating to a gross yield of around 4.8%. Residential properties also benefit from strong liquidity, easier financing, and well-understood market dynamics, making them a lower-complexity investment.
In contrast, Specialist Disability Accommodation (SDA) is a niche asset class designed to house people with high support needs under the NDIS. SDA properties often deliver significantly higher rental incomes due to the SDA funding provided by the government to NDIS participants. A well-located 3 bedroom plus OOA (carer’s room) High Physical Support SDA home valued at $1.5 million may generate between $149,000 to $217,000 per year in gross rent*, if tenanted with 2 to 3 participants depending on tenant funding levels and location and tenant configuration. This can translate to gross yields of 9% to 14%, substantially higher than a standard residential property.
SDA investments also offer the benefit of the income being largely disconnected from broader rental market fluctuations. Additionally, SDA provides a strong social impact by addressing the shortage of appropriate housing for people living with disability.
While SDA requires greater upfront research, compliance, and specialist management, it can offer higher cash flow and diversification for experienced investors. When choosing to invest in SDA, it pays to do your research and choose an experienced provider with the knowledge and experience to ensure your investment is managed successfully from start to finish.
Ultimately, both property investment types can play a valuable role in a balanced portfolio—residential property offering simplicity and capital growth, and SDA delivering enhanced income potential and social outcomes.
*Income figures quoted are based on a home in Brisbane South with fire sprinklers and are calculated from NDIS SDA Price Calculator 2025/26 New Builds issued July 2025 & includes SDA funding + tenant Reasonable Rent Contribution (RRC).
