Property prices in Hobart surged to record highs this past quarter, the latest Domain House Price Report has revealed.
From July to September, median house prices in the Tasmanian capital rose 6.9% to $555,754, marking the steepest quarterly increase since late 2017.
The growth dwarfed Sydney’s third quarter rise of 1.2%, Perth’s 0.9%, Brisbane’s 0.4%, and the national figure of 0.9%. Melbourne posted zero-growth in real estate prices in the previous quarter, primarily due to the government-imposed lockdown.
Year-on-year, median house prices in Hobart rose 15.7%, eclipsing Sydney’s increase of 6.8%, Melbourne’s 1.6%, Brisbane’s 3.7%, and the national average of 4.6%.
Although property prices in the Tasmanian capital are still well below Sydney’s median of $1,154,406 and Melbourne’s $875,980, these are fast catching up to Brisbane’s $596,316.
But while house prices were on an uptrend, unit prices in Hobart declined further in the previous quarter, dropping 9.1%, which was the steepest fall among all capital cities. The annual median value of units dipped for the first time in a year, with a 1.5% decrease year-on-year.
The median unit value in the Tasmanian capital is down to a one-year low of $384,672, according to the Domain report.
“Hobart’s housing market has become highly fragmented in recent months, with houses outperforming units,” the report said. “The significant drop in unit values could be attributed to Hobart’s exposure to tourism and reduced investor interest will be weighing on units’ values considering the vast majority are located in central Hobart.”
“While Hobart has been a destination of choice given the relative affordability and lifestyle on offer, the health pandemic could accelerate this trend, as working from home becomes the norm for white-collar workers, which is likely to continue to support house prices.”
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