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Looking for income? Consider these 3 ASX shares with 5%+ dividend yields

Investing in high-yielding shares remains an attractive option for income-seeking investors, especially when you consider interest rates could remain at these historically low levels for sometime to come.

Fortunately, there are a number of small-cap shares that investors can consider right now, including:

Villa World Ltd (ASX: VLW)

Villa World has been a consistent performer over the past few years and only recently upgraded its FY17 guidance on the back of a stronger-than-expected first-half result. While there remains some risks in certain parts of the Australian housing market, the home-building company is taking steps to mitigate these risks by expanding its operations across a number of different states. The Villa World share price has performed strongly over the past 12 months, yet the company still trades on an attractive price-to-earnings ratio (PER) of 7.5 and offers a massive dividend yield of 7.4%.

RCG Corporation Ltd (ASX: RCG)

Unlike Villa World, RCG underwhelmed investors with its first-half result and second-half trading update that resulted in a full-year profit downgrade. Despite the weaker-than-expected update, the athletic clothing and footwear company is still growing at a rapid pace and remains on track to deliver a big uptick in full year profits. Investors who believe the shares have finally hit a bottom should see the current share price as an attractive entry point considering they now offer a fully franked dividend yield of around 5.4%.

Lifehealthcare Group Ltd (ASX: LHC)

Lifehealthcare is a small-cap healthcare company that specialises in the distribution of specialist surgical equipment across Australia and New Zealand. The company’s first-half profit result was negatively impacted by the weaker Australian dollar, but its underlying business operations continue to track along nicely. After a decent pull-back, the shares currently trade on a PER of 11 and offer a dividend yield of more than 6%.

What about this!

A Big, Fat, Fully Franked Dividend

This company's dividend is almost the stuff of legends. Since it started paying dividends in 2007, it has increased its payout to shareholders every single year, a run that includes 21 consecutive dividend increases.

Based on the last 12-months of dividends, its shares are currently offering a fully-franked 4.8% yield, which grosses up to almost 7% when those franking credits are included. And in stark contrast to the likes of Commonwealth Bank and Telstra, this company just increased its dividend by over 13%, and guided for 2017 profits to grow by 20%!

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Motley Fool contributor Christopher Georges owns shares of LifeHealthcare Group Limited and RCG Limited. 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 Bruce Jackson.

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