Bonnells Bay vs Katoomba

Houses cost about the same in both suburbs: the median house price is $920K in Bonnells Bay and $920K in Katoomba.

On cash flow, Bonnells Bay leads: houses there return a gross rental yield of 3.80%, compared with 3.59% in Katoomba, a gap of 0.21 percentage points.

Over the past year house prices moved +7.2% in Bonnells Bay and +7.6% in Katoomba, so recent momentum favours Katoomba, although both suburbs recorded growth.

Looking back three years, Bonnells Bay houses are +14.6% and Katoomba houses +13.4%, so Bonnells Bay has compounded faster than Katoomba over the longer window.

Rental vacancy is 0.7% in Katoomba and 1.6% in Bonnells Bay, so landlords in Katoomba face less competition for tenants. Anything under 2% is generally read as a tight market where tenants compete for homes.

Katoomba is the bigger suburb, with a population of 8,268 against 4,066, roughly 2.0 times the size of Bonnells Bay; a larger suburb usually means a deeper pool of buyers and tenants.

In short: Bonnells Bay for rental income, Katoomba for recent price momentum, Katoomba for the tighter rental market. Which matters more depends on whether the investor is buying for cash flow, capital growth or affordability.