With an average dividend yield of approximately 4.5%, the Australian share market is one of the most generous in the world.
Which will certainly be a relief to income investors given the outlook for interest rates in Australia over the coming years.
But you don't have to settle for a yield of 4.5%. Three dividend shares that offer yields well above the market average are listed below. Here's why I like them:
Coles Group Ltd (ASX: COL)
This recently listed supermarket giant could be a great option for income investors in my opinion. Although it has yet to reveal its dividend plans, brokers have been busy predicting what it will pay out to shareholders based on what management has said previously. According to a note out of the Macquarie equities desk late last year, it expects Coles to pay a fully franked full year dividend of 65.7 cents per share in FY 2019. If this estimate proves accurate it will mean that its shares offer a forward fully franked 5.6% yield. This potential yield and its attractive valuation make Coles a buy in my eyes.
Commonwealth Bank of Australia (ASX: CBA)
Australia's largest bank had a very disappointing 2018 due largely to the Royal Commission and a cooling housing market. While the housing market looks unlikely to improve greatly in the near term, I believe the dark clouds of the Royal Commission will finally lift next month after its final report and recommendations are released. This could make it worth snapping up CBA shares whilst they are down. Especially as they currently offer a trailing fully franked 5.95% dividend.
National Storage REIT (ASX: NSR)
National Storage is one of Australia and New Zealand's leading self-storage providers with a sizeable network of modern centres generating increasing amounts of revenue per available square metre. Although it isn't the most exciting share to buy, its robust business model and long-term growth plans make it worthy of consideration. Last year the company raised ~$175 million, putting it in a great position to fuel its growth through acquisition strategy in a highly fragment market. At present the company's units provide a trailing 5.4% distribution yield.
