Tasmania April 2017

The month in review: Tasmania

By Herron Todd White
April 2017

Moonah, an inner-city suburb located approximately five kilometres from the city, is a highly desired location in the south of the state. The median house price is $310,125 and the median unit price is $218,500. Local real estate agents have reported buyer demand outweighing current property stock in Moonah, as the suburb is popular with both investors and owner-occupiers. Vacancy rates are tight at 0.4% and rental yields are high at 5.7%, making Moonah an in-demand location for investors. Typically, older-style homes under 150 square metres or units under 100 square metres can be purchased within the $250,000 to $350,000 range, which also offer renovation potential to bring them up to date. Currently for $340,000 you can purchase a circa 1930s-built 3-bedroom, 1-bathroom weatherboard house that offers renovation potential and sits on a 518-square metre allotment. Local real estate agents have reported that a mix of both local and interstate investors have shown interest and purchased properties in Moonah. The level of activity is set to rise due to buyer demand outweighing property stock available on the market, which most likely will push the price up. Should prices increase and stock levels remain low we could see buyers pushing into the neighbouring suburb of Glenorchy.

In the north of the state located approximately four kilometres from the city, South Launceston is highly desired by buyers at present. The median house price is $260,790 and the median unit price is $204,525. The average house in South Launceston is rented for $300 per week and rental returns are high at 5.87%. The median rental price for units is $265 per week and the rental return is 5.75%. Strong rental yields coupled with low interest rates have increased demand as many first home buyers and investors have shown interest in the area. Currently for $255,000 you can purchase a 2-bedroom, 1-bathroom weatherboard house on 450 square metres of land that offers renovation potential with an expected rental return of $280 per week. Much like Moonah in the south of the state, the stock level in South Launceston is low with buyer demand high, which will most likely lead to a price increase in the area should there be no increase in stock released to the market.

Houses throughout Moonah and South Launceston are in higher demand compared to units as most buyers are after the additional land size, which can also offer development potential subject to council approval. Older-style homes with renovation potential appear to be in high demand at present as many buyers are looking to purchase homes in these locations for a lower price compared to an already renovated home. This allows the owner-occupier the opportunity to customise the home to their taste and for the investor to potentially increase the value in the property along with an increase in the rental price. A standard 3-bedroom, 1-bathroom, weatherboard home on a minimum of 500 square metres of land appears to be the most desirable throughout Moonah and South Launceston as homes with these characteristics fall within the desired price range.

The strongest price point in the south of the state is within the $350,000 to $400,000 range, as within this range first home buyers and investors are looking to buy property. In the north of the state the strongest price point is the $250,000 to $300,000 range, which again is popular with investors looking for a strong rental return and for first home buyers looking to get into the market with an affordable first home. We may see a slight increase in price due to the low stock levels and high demand; however, this could lead to buyers moving into neighbouring suburbs, which may keep the prices steady.

 

Share on:

DISCLAIMER: The information contained in this article is correct at the time of publishing and is subject to change. It is intended to be of a general nature only. It has been prepared without taking into account any person’s objectives, financial situation or needs. Before acting on this information, Smartline recommends that you consider whether it is appropriate for your circumstances. Smartline recommends that you seek independent legal, financial, and taxation advice before acting on any information in this article.