Hobart’s hot streak has tempered slightly, but growth remains impressive and demand is still high from both buyers and renters
Hobart is staying put as one of Australia's hottest markets at present. According to Empower Wealth director of research Jeremy Sheppard, Hobart’s average demand-tosupply ratio is similar to that of Sydney’s in its boom period.
“The impressive thing about Hobart is that the worst market according to supply and demand is not nearly as bad as in other significant urban areas around the country. That means it’s not too hard to pick a winner,” Sheppard says.
“Hobart has cooled a bit since late last year but is still pretty hot. Demand is still well ahead of supply, so growth doesn’t look like levelling out.”
It’s a win-win situation for everyone, from buyers and sellers to landlords and tenants.
“Properties are being snapped up pretty quickly, and venders are getting the prices they want. The auction clearance rate is very high too,” Sheppard reports.
“From a rental perspective, vacancy rates are the tightest in the country for a state capital, and yields are up there too, at over 5%. And with such a long period of low vacancy rates, rents are growing. In the last year they’ve grown by 10%.”
Regional markets shine
For a while, it seemed like Hobart alone was enjoying the attention, but now more of the regional markets are catching investors’ attention.
“Launceston is another Tasmanian market doing quite well. It was always behind Hobart for 2017 but has now matched Hobart. Hobart’s impressive run last year has pushed it past the best time to buy. But Launceston is still early in its growth cycle,” Sheppard says.
Many outer-ring suburbs are still struggling, but over 40% growth has already been recorded in the Clarence and Glenorchy property markets.
“Outside of Hobart, parts of regional Tasmania are seeing markets tighten,” says Simon Pressley, managing director of Propertyology.
“For example, over the last 12 months, Burnie and Devonport have seen a healthy increase in sales volumes and a significant reduction in days on market. This combination generally leads to price growth.”
Pressley also emphasises just how strong the Hobart market has become over recent years.
“Over the last three years, property prices in metropolitan Hobart have now increased at a higher rate than both Sydney and Melbourne.”
SUBURB TO WATCH
LONGFORD: A thriving rental market
A country suburb steeped in Australia’s history, Longford is popular with tourists, but its affordability is also making it a hit with buyers and tenants.
After a consistent pattern of growth observed since 2013, the median house price in Longford is still only $274,639, while the unit median is under $250,000. Rental rates for houses soared by 11% in the 12 months to March 2018, with investors able to reap returns of over 5%.
A 20-minute drive from Launceston, Longford is known as the home of the oldest motorcar racecourse in the country. It also has a thriving agriculture industry that supports a foodie culture.
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