Over the last couple of years, Hobart has been the star performer of Australian real estate, and there appears to be no end in sight to the southern state’s healthy capital growth.
The residential market in the Tasmanian capital is growing at 3.5%, according to the latest statistics from CoreLogic, pushing the median dwelling price above $ 445,200. In comparison, the Canberra is achieving the next best growth of 2.4% with a median dwelling price of $587,600.
While the Hobart market isn’t setting the same growth records as 12 months ago, Ron Brooks, Director of Raine & Horne Tasmania said, lack of new stock will continue to underpin real estate values long-term in Australia’s southernmost capital city.
“Builders and developers are just finding it tremendously difficult to keep up with demand for off-the-plan residential opportunities,” Ron said. “New property sales are off the map, but getting land titles organised is tough for builders, which is slowing the development process.”
Exacerbating the situation, Ron said Hobart is fast running out of land for new developments due to rapid population growth. Hobart and South East Tasmania are growing at 1.4% compared to 0.8% growth for Launceston and the state’s north east, according to a March report form the Tasmanian Department of Treasury and Finance. “Concerning sales, we might have a few more days on the market. However, any property that is priced well in Hobart is selling quickly due to demand.
“On this basis, and unless there is a dramatic and unpredicted external event such as the global financial crisis, I can’t see why we won’t have healthy market conditions in Hobart for some time yet.
In Launceston, Ron said the property market is also very steady. “They have the same issues regarding land shortages that face developers in Hobart.”
On the commercial front, Ron said multiple high-value developments are under construction or consideration for the city within the next few years, including the Elizabeth Street retail precinct upgrade and Hobart Bus Mall upgrade. Also, due to be built by year's end is the $45-million Crowne Plaza located above the new Myer store in Liverpool Street. It is set to open early in 2020.