Hobart Property Market Update 2nd Half of 2022
In Q2 2022, Hobart recorded a median house price of $1,092,500, and a median unit price of $586,200. This represents annual (Q2 2021 – Q2 2022) median price growth of 18.8% for houses and a softening of -16.9% for units. Total sales slowed between Q2 2021 – Q2 2022, by -0.8% (to 123 sales) for houses and by -43.2% (to 46 sales) for units. The Hobart market is split into different speeds. There is still strong demand in the house market as price growth is coupled with a decrease in sales, thus an undersupplied market. The imbalance in demand and supply can provide a buffer against cash rate hikes.
Average vendor discounts between Q2 2021 and Q2 2022 have shifted for both property types, to lower premiums of 5.6% for houses and 2.8% for units. Market conditions still favour vendors, but premiums have tightened with buyers offering closer to the initial listing price. This creates an opportunity for buyers and may swing further downwards due to cash rate hikes.
In June 2022, house rental yields in Postcode 7005 were recorded at 2.9%. In the 12 months to Q2 2022, the median house rental price increased by 5.5% to sit at $580 per week, despite a 6.0% increase (to 316 rentals) in the number of houses rented. This suggests renters are willing to pay higher, even without an undersupply in the market. Average days on the market declined -8.7% to 21 days during the same period, indicating a strong rental market in Hobart.
4+ bedroom houses have provided investors with +7.7% rental growth annually, achieving a median rent of $700 per week.
In June 2022 Postcode 7005 had a vacancy rate of 1.0%, above Hobart LGA (0.8%) and Hobart Metro (0.6%). Vacancy rates in Postcode 7005 remain well below the Real Estate Institute of Australia’s healthy benchmark of 3.0%. Low vacancy remains a feature for Hobart, however, have recently trended upwards after reaching its lowest point in February 2022 at 0.4%, but remaining under 1.0%. These key indicators create a conducive and sustainable environment for investors.
