Tasmania July 2018

The month in review: Tasmania

By Herron Todd White
July 2018

Hobart

Hens teeth are almost easier to find than a sub $500k house in the inner Hobart region! The property ‘boom’ has lifted most houses out of this price segment. However, their are still units to be found with currently two on the market; one a 1970’s flat style 2- bedroom 1- bathroom in West Hobart for sub $400,000 and another sub $450,000, 2- bedroom 1- bathroom older style in Molle Street.

With Hobart’s median pricing just having passed the $450,000 price threshold ($453,000 in April; now just $10k below Adelaide!) the search for affordable housing takes you to the middle ring and outer ring suburbs. For example, in Berriedale you can still purchase a neat 3- bedroom 1- bathroom for around the $300k mark while in Howrah, a sought after suburb on the eastern shore a 1960’s style brick 3- bedroom, 1- bathroom is currently on the market at the $500,000 range mark.

The housing shortage, as we have discussed previously, has left Hobart with a virtual nil vacancy rate with rents now accounting for a greater percentage of the average wage than in Sydney!

Using the Howrah property as an example we would expect a gross return of around 5% if that were to be placed in the rental pool. Gross yields in excess of 7% are being achieved in some of the lower socio-economi suburbs such as Bridgewater and Gagebrook.

That said, we are starting to see some cooling in the buyer activity with one agent describing putting a new listing to market this time last year as throwing to a pool of piranahs, while this year it is a pool of trout.

Launceston

Launceston still offers affordable buying with the median house price just $292,000 for the Greater Launceston Region. However, taking just the Launceston suburb itself, this rises to $462,000.

In essence, under $350,000 will buy you a renovated 3- bedroom, 1 or 2- bathroom brick home in an established, solid residential suburb such as Summerhill and for the investors, you would expect a gross yield of between 5 to 6%. Those who took this advice last year would have enjoyed a capital return upwards of 10%.

The piranahs are very much still feeding in the northern capital with this market continuing full steam a head.

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.