When it comes to property investment, most people chase either capital growth or yield. Rarely do you find an opportunity that delivers both income security and future growth potential. That’s where rooming houses with rent guarantees step in.
What is a Rooming House?
A rooming house is essentially a single dwelling designed with multiple self-contained rooms, each with its own ensuite and living space. This means you’re not renting out “a house” — you’re renting out five income-producing streams under one roof.
The Winter Valley example in Victoria showcases this perfectly:
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Purchase Price: $906,000
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5 Bedrooms, 5 Ensuites, 2 Car Spaces
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Gross Rental Yield: 7.75%
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Weekly Rent: $270 per room ($70,200 annual rent)
The Game-Changer: Five-Year Rent Guarantee
Many investors get nervous about vacancies. With a standard single-family rental, one vacancy means 100% of your rent is gone.
With a 5-year rent guarantee, you’re effectively removing that risk. Whether or not the rooms are full, you’ll receive the agreed rent, creating true peace of mind. It’s like having a safety net built into your investment strategy.
For example, the Winter Valley property generates:
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Net Cash Flow Before Depreciation: –$2,004 (slightly negative)
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But once you add depreciation and tax savings, the net flips to + $11,646 per year (around $224 per week in your pocket) .
This is where the rent guarantee makes all the difference — you’re locking in that performance regardless of short-term tenant movements.
Why Investors Love Them
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Cash Flow Security – Even in a softer rental market, you’re covered for five years.
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Higher Yields – Rooming houses typically deliver yields between 7–8%, well above standard houses at 3–4%.
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Tax Efficiency – With depreciation benefits, your cash-on-cash return is even stronger.
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Growth Potential – Located in high-demand corridors like Ballarat, you’re not just getting cash flow, but also long-term capital growth.
A rooming house with a five-year rent guarantee isn’t just another investment — it’s a portfolio stabiliser. It gives you the certainty of cash flow while still playing in growth markets. For investors who want both peace of mind and strong performance, this is the kind of property that ticks every box.
👉 At Coleman Invest, we specialise in sourcing these opportunities and walking you through every step — from finance to build to tenanting. If you’re ready to add certainty and strength to your portfolio, this is where you start.
