The property market in Tasmania ended unpredictably strong at the back end of 2016, with 9793 residential sales in total for the year. This figure broke a record for the state as well, exceeding a total of 3.1 billion dollars’ worth of property sold. Numbers quite this high haven’t been seen in Tasmania for at least the last 7 years as the previous record was set back in 2009.
Some of the primary reasons for this outstanding growth rate are due to strong business and economic conditions, a confident and encouraging political environment and of course, the record-low interest rates available. Secondary to these influences are the relaxed, and considerably less expensive lifestyle that Tasmania has to offer, in conjunction with lower density locations. According to the figures, Tasmania was the place Australians wanted to be in 2016.
December’s Quarter Figures Alone
Hobart alone accounted for over 33% of Tasmania’s property sales, selling 592 houses. This also included 54.2% of all units sold in the December quarter.
Hobart’s average selling price increased by 9.7% as well, bumping it up to $430,000. However Launceston had seen a marginal decrease in sales numbers with only 243 houses sold, with a median property price of $230,000. Northwest locations recorded their highest numbers as well, selling 161 houses at a median price of $259,000.
The highest selling numbers are still seen within inner Hobart where average house prices are towards the $600,000 mark, and units $370,000 respectively.
The December quarter found investor activity had increased by 3%, however for the year in total this activity had actually decreased by 1% – down to 16%.
Over The Full Year – 2016
630 investors purchased a property in Tasmania, while 1014 made a purchase with the intention to live there in the near future.
23 properties were bought that sold for over $1,000,000. Investors made up 1870 properties, buying at a median price of $235,000 with approximately 66% of them being locals. The strong rental yields of between 4% and 6% are the driving factor behind the investment appeal in Tasmania.
Pressure had been placed on the Tasmanian market as properties for sale were down around 30% compared to recent years. This had affected prices is some locations dramatically, despite the influx in buyer interest and confidence over not just 2016, but 2015 as well.
Strong demand over the past 24 months is what has kept the Tasmanian market stabilised up until now. On the contrary, this level of demand combined with short supply of homes available to rent will see prices rise over the coming year. While this may be the case, the steady market conditions are likely to remain relatively similar to what we’ve seen in 2015 and 2016.
It is a local market as well, with 80% of purchases made by Australians. With this trend continuing into 2017, Tasmania will still be the most affordable place to buy a property in the whole of Australia, and will remain a hotspot for serious investment and lifestyle opportunity for young families.