At present Commonwealth Bank of Australia (ASX: CBA) is offering interest rates of just 0.9% on five-year term deposits. This is broadly in line with what the rest of the banks are offering.
If you’re an income investor, then I wouldn’t settle for these paltry interest rates.
Instead, I would turn to the share market, where you can easily get a greater return on your investments.
But which ASX dividend shares should you buy? Here are two top options for investors to consider buying:
National Storage REIT (ASX: NSR)
The first ASX dividend share to look at is self-storage operator National Storage. I think the company is a top option for income investors due its positive long term growth outlook thanks to its organic and inorganic growth opportunities. The latter is through its growth through acquisition strategy which has been very effective over the last few years.
It does look as though FY 2021 could be a reasonably subdued year because of the pandemic, but I expect a swift rebound once the crisis passes. Especially given optimism over the housing market. This could lead to higher housing sales activity and increasing demand for its storage solutions. Based on the current National Storage share price, I estimate that the company’s shares offer investors a forward 4.2% dividend yield.
Vitalharvest Freehold Trust (ASX: VTH)
A second ASX dividend share to consider buying is Vitalharvest. I think it would be a great option for investors that are looking to diversify their portfolio. This is because the company’s shares provide investors with exposure to quality agricultural property assets. Some of these assets, which comprise four berry properties and three citrus properties, are leased to horticulture giant Costa Group Holdings Ltd (ASX: CGC) and are exposed to the nutritious and healthy food trend.
In light of this, I believe the company is well-placed for earnings and distribution growth over the next decade. For now, based on the current Vitalharvest share price, I estimate that it offers investors a forward ~6% distribution yield.
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Returns As of 6th October 2020
More reading
- ASX 200 finishes 1.3% higher after federal budget
- ASX 200 up 0.4%: Big four banks push higher, Westpac upgraded, ARB impresses
- Is the CBA share price a buy right now?
- Why this Federal Budget is good for many ASX shares
- Here’s where you could invest your Woolworths (ASX:WOW) dividends today
Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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