Housing price rise tops list
Hobart values up almost 27pc
IN the past year, Hobart home values have ballooned by 26.8 per cent – the highest increase in the nation.
And the median value has climbed to $659,622.
If price growth continues to ascend at the current quarterly growth rate of 6.4 per cent, the median will surpass $700,000 by year’s end.
Just one year ago, Hobart’s median was $170,563 lower than what it is today. In September 2019 it was $200,351 less than what it is now.
Of the capital city property markets, Hobart recorded the largest monthly median price change in September at 2.3 per cent.
CoreLogic’s September Home Value Index revealed only Sydney, Melbourne and Canberra have a higher median dwelling value – houses and units combined – than Hobart.
Hobart is closing in on Melbourne’s median – there is now a $115,520 gap between the cities.
Real Estate Institute of Tasmania president Mandy Welling said at this point results should not come as a surprise.
“Dare I say, we could expect this type of growth to continue,” she said.
“When Covid restrictions are lifted, I think we will see a surge of buyers coming to Tasmania. The result would be more upward pressure on our prices.”
CoreLogic research director Tim Lawless said with housing values rising substantially faster than household incomes, raising a deposit and funding transaction costs has become more challenging for most cohorts of the market, especially firsthome
buyers. In order to raise a 20 per cent deposit, the typical Hobart buyer would need about $131,924.
Mrs Welling said affordability was of real concern.
“We are seeing many parents act as guarantors to help young buyers get a foot in the door,” she said.
“A silver lining for buyers who bought a property that was under construction or about to be built is that by the time the title is issued the value of their home may have grown $60,000 to $100,000 higher.
“That is phenomenal for a firsttime buyer, it gives them a buffer.”
In regional Tasmania the growth story was the same as the capital, with the Apple Isle ranking No.1 with 27.2 per cent annual growth, just slightly ahead of regional NSW.
On the rental front, Hobart house rents have pushed 12.6 per cent higher over the past year while unit rentals trended upward by 13.3 per cent.
Both represented the third-largest change in rents in the nation behind Perth and Darwin.
Rental yields have dipped to 3.9 per cent in Hobart, which is still higher than the combined capital cities dwelling figure of 3 per cent.
Mr Lawless noted an emerging risk factor in the market was the potential for tighter credit constrictions. “This week we saw the federal Treasurer endorse tighter credit policies for home lending,” he said.
“This is consistent with commentary from the Reserve Bank and APRA.”