Buyer demand triples as Tasmanian agents buck national downturn

Recent data from REA Group found that the Hobart suburb of Risdon Vale saw the largest year-on-year (YoY) change in key inquiries per listing, soaring by 245 per cent.

Hobart had four other suburbs feature in the top ten, with Chigwell, Bridgewater, New Norfolk, and Berriedale boasting YoY changes between 199 per cent and 139 per cent.

Additionally, the township of Upper Burnie in Tasmania’s north-west had the second-largest jump at 243 per cent.

REA Group senior economic analyst Megan Lieu said strong growth across the other capitals and high rental yields had driven a spike in interest in Hobart.

"Following years of strong price growth in Brisbane, Perth, and Adelaide, Hobart is now the second most affordable capital city,” Lieu told REB.

“In addition to that, rental yields are the second highest among capitals, which is a major drawcard for investors. These two factors are driving a strong increase in demand in some suburbs within the city.”

Similarly, 4one4 sales consultant Aaron Murray said that the affordability and a lack of supply in Hobart’s housing market had bolstered buyer interest in the Apple Isle’s capital.

“It (the demand jump) is what we are seeing on the ground, and honestly, the numbers don’t surprise me,” Murray told REB.

Murray said investors and owner-occupiers had seen an opportunity to enter the housing market at more affordable prices.

With high rental yields available for a fraction of what investors would expect to pay in other capital city markets, Murray said Risdon Vale had become a hotbed of activity for interstate buyers.

“For Risdon Vale, the rental yield is around 5 per cent, and that’s probably one of the best across the board,” he said.

“A property around the $500,000–$600,000 mark makes so much more sense from a rental yield perspective than a million-dollar home, so investors are looking closely.”

He said that agents who adjusted to the speed of transactions were achieving strong results.

“If a buyer comes through an open home on a Saturday, you can’t necessarily wait until Monday to get back to have a conversation with them, because they’re looking at multiple other properties,” Murray said.

With more buyers actively in the market, Murray said it was important to generate the competition to achieve strong results for their clients.

He said that three-bedroom, one-bathroom detached houses were still the most popular asset in the market, offering strong yields for investors while giving first home buyers extra space.

“Well-presented, entry-level homes are still attracting strong interest from buyers, while the higher end of the range remains more selective.”

Going forward, Murray said Hobart would continue to benefit from strong investor interest driven by the lack of supply coming to market.

“What I do expect is the competition for the affordable properties will remain. It still has that aspect when compared to Sydney, Melbourne, and other capitals. We are still the most affordable state, but there is also a genuine housing shortage.”