Derwent Valley Property Market Update 1st Half 2023
In Q3 2022, Derwent Valley recorded a median house price of $477,500. This is an annual (Q4 2021 – Q4 2022) median price growth of 3.0%. That said, on a quarter-by-quarter basis (Q3 2022 – Q4 2022), median house price softened by -10.7%. This is a reflection of interest rate hikes, consumer uncertainty, and economic conditions. House sales declined annually and quarterly, with Q4 2022 recording the lowest number of sales (25 sales). Median vacant land price in Derwent Valley was $266,000 in Q4 2022, reflecting a 13.2% annual median price growth, but a -4.1% softening on a quarter-by-quarter basis.
Average vendor discounts between Q4 2021 and Q4 2022 have remained at a premium for houses, although trending lower at 5.0%. Average vendor discount has swung to a discount for vacant land, to -4.8% in Q4 2022. House market conditions in Derwent Valley continue to favour sellers, where buyers will have to pay above the initial listing price. Vacant land buyers can now benefit from a discount, thus an opportune time.
In December 2022, house rental yields in New Norfolk were recorded at 4.5%, on par with Hobart Metro (4.5%). In the 12 months to Q4 2022, median house rental price increased 7.8% to reach $485 per week. In this time the number of houses rented increased by 66.7% and average days to let remained at 20 days. Overall, this represents a resilient rental market.
2 bedroom houses have provided investors with +10.5% rental growth annually, achieving a median rent of $420 per week.
New Norfolk recorded a vacancy rate of 1.0% in December 2022, which is slightly above Hobart Metro’s 0.6% average. The sudden spike can be attributed to interest rate changes, with investors potentially selling their rental properties due to financial viability. That said vacancy rates in New Norfolk have trended relatively steady over the past 12 months and under the Real Estate Institute of Australia’s healthy benchmark of 3.0%. This indicates a conducive and sustainable environment for investors, particularly with a slower growth in median property sale prices.
