Tasmania stays the course
Sales volume creeps up in the upper end segment as upgraders slowly return.
The property market in Tasmania has slowed during the first six months of 2009, however, it does appear to be showing some resilience to the adverse effects of the global economic downturn.
Residex data showed median house price in Hobart ended the June quarter up 2.82% to $356,000. Rental growth was also strong at 5.08%. The steady appetite for affordable properties in the city helped sales grow by a healthy 5.51% for the year.
The unit market also performed well with median unit price rising by 3.57% for the year ending June to $257,000.
""The market up to $350,000 remains buoyant due to the effects of the grants," says an Opteon report. "While the top end of the residential market remains soft, there has been an increase in volume of sales above $1 million in the last quarter."
Tasmania's rental market remains tight with the vacancy rates increasing marginally by 0.2%. "We expect the market to be relatively stable in those locality not adversely affected by unemployment," says the Opteon report.
As in other Australian states, the Tasmanian property market has been strongly supported by new entrants. First homebuyers accounted for more than 50% of recent mortgage approvals excluding refinancing according to the latest official data - the highest level in the country. This makes the state particularly vulnerable going forward as the impact of these new entrants starts to wear off. But Chris Bone, state manager for Roberts Real Estate, says he is yet to notice any sign of new entrants slowing.
"It's still very stable," he says. "There's still a lot of impact from first homebuyers and still a steady inquiry for properties up to and around $400,000."
Prices are remaining relatively stable, according to Bone, and investors are slowly starting to come in and replace first homebuyers. "There is a slow uptake on investors but they are definitely taking more interest in the market here," he says. "Returns are improving as rents increase with increasing demand."
Bone says a good rental property will set an investor back anywhere from $180,000 to $400,000 with most affordable rents in that range. Interestingly, Bone says he is seeing specialised home builders doing well and quite a few opportunities arising in the more remote areas.
"The regional areas are seeing some strong growth," he says. "There's a good opportunity to buy new homes and outer regions are experiencing some solid interest."
ABS figures also show that Tasmania enjoys the lowest unemployment in the country, which is touted as a reason that the state has avoided some of the more serious downturns of some areas of the mainland. With unemployment in June at 4.7%, it is actually bucking the trend of every other state with employment increasing further strengthening the confidence of potential homebuyers.
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