The confidence of both local and interstate buyers keeps increasing as Hobart’s property market maintains its winning streak
Where other markets are going down, Hobart is moving up, and investors are taking notice. According to ABS housing finance figures, the number of housing loans taken out over the six months to March 2018 has dropped in most of the states – except in the Apple Isle.
“In trend terms, decreases were recorded in all states and territories except Tasmania, where lending increased by 7.2%,” says Malcolm Gunning, president of the Real Estate Institute of Australia.
This statistic is just one of many indicators of how much the Hobart property market is flourishing at present, supported by its stellar economy.
“Hobart is going through a bit of a profitable patch economically. The low dollar has meant that it’s been attractive for overseas tourists. It’s also becoming increasingly attractive for domestic tourists who’ve been going there in increasing numbers,” says Angie Zigomanis, senior manager of residential property at BIS Oxford Economics.
Aside from the strong inflow of visitors, Hobart has been seeing a lot of interstate migrants come into the market. The population growth is helping to anchor the excellent performance of the property market.
“There’s every possibility that 2018 might be the year that metropolitan Hobart becomes the first Australian capital city in the post-GFC era to produce 20% price growth,” predicts Propertyology managing director Simon Pressley.
Tenants squeeze in
Low levels of housing supply help to maintain high demand among renters and those looking for short-term accommodation, to the delight of investors. Pressley says, “Rents haveincreased significantly over the last 12 months. A combination of improved interstate migration and high demand for Airbnb accommodation has held vacancy rates at an all-time national low.”
CoreLogic data confirm that, in the 12 months to April 2018, rental rates increased by 11.7% in Hobart – the biggest increase recorded by a capital city and the market’s fastest rental growth rate for almost a decade.
While the Tassie capital remains the most expensive place to rent in the state, other areas are catching up – for instance, Southeast Tasmania’s rents went up by nearly 50% during this period. It was also the only region to show a boost in rental yields, which makes it the most profitable pocket in the state for investors.
SUBURB TO WATCH
NEWSTEAD: House demand is high
A stone’s throw from the Launceston CBD is the suburb of Newstead. It is an education hub, and many schools make their base here. The list includes Newstead College, Newstead Christian School and Launceston Preparatory School. In addition, residents’ medical needs can be met by Newstead Medical, a general practice on Elphin Road.
Being so close to a tourist town like Launceston means that Newstead residents get to be a part of its bustling scene, enjoying the many retail amenities Launceston offers.
This low-priced pocket is quickly showing itself to be a gem, with houses recording 9.8% growth in the 12 months to April 2018, continuing a positive trend observed for the past five years.
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