Hobart, the capital city of Tasmania, has gained a significant amount of attention from potential investors and first-time house buyers in the past three years. The quaint scenery and quirky architecture and steady economic growth has made Hobart an attractive choice for property buyers.
The market downturn that affected Sydney, Melbourne and other Australian cities had little effect on the capital city of Tasmania. Hobart has experienced the most rapid growth in property prices in recent years, and it still maintains a relatively affordable median house price.
Considering the current market climate, what does 2019 have in store for Hobart?
What Happened in 2018?
Despite the market decline in other parts of Australia, Hobart remained mostly unaffected in 2018. It experienced notable growth, with a strong rental market and steady population growth, Hobart avoided much of the issues that plague Sydney and Melbourne.
QBE’s Australian Housing Outlook 2018-2021 states that Hobart’s median house price was $481,000 in June 2018, a 10.6% increase since June 2017.
The most notable growth happened in Brighton, a 17.3% increase in the past year.
Hobart City recorded a lower growth rate of 6.3% from 2017-2018.
The rental market recorded vacancy rates of 0.7% in June 2018, the same as in 2017.
Hobart Property Market Forecast 2019
Property experts predict that growth will continue in 2019. However, Hobart could experience a slight property market growth reduction in the next two to three years.
QBE Australian Housing Outlook predicts a +8% price growth for 2019-2021, thus bringing the median house price to $520,000. The median unit price is expected to increase to $420,000 which is a +9% rise.
Forecasted figures may vary depending on political climate, economic growth, and bank interest rates. Here are some of the factors that might affect Hobart’s property market in 2019.
+5% – +9% growth if the cash rate remains the same and the economy slows down, and Labor government
+4%- +7% and a 0.20% interest rate increase, no change in cash rate and Labor government
+5%- +9% with a 0.50% rate reduction by banks, and a Labor government
If Labour government is elected in 2019, this could harm the property market; however, as it stands, Hobart’s property market looks relatively healthy.
Top Suburbs To Invest in Hobart 2019
As a potential property investor, understanding the best areas to invest your money is crucial. Here are some of the suburbs to consider when thinking about investing in Tasmania property.
Focus on affordable suburbs north-west of the city such as Glenorchy and Moonah. These areas provide good vacancy rates and strong rental returns. For example, Glenorchy’s rental yields are 5.4% currently, and the median house price is $365,000.
The outer ring suburbs are often the best choice because they offer the most substantial growth potential and they are less costly.
Kingston is a decent option if you are looking South of the city, with strong price growth, affordability, and 4.7% rental yields, it is a viable choice for potential property investors.
Lindisfarne is also a suburb to watch in 2019, North-east of the city, it provides, excellent living conditions, and affordability. As well as healthy rental yields of 4.6%, unemployment and crime rates are relatively low as well as good schools, shops, and efficient transport links, Lindisfarne is another excellent choice for potential property investors in 2019.