Hobart is shaping up to be among Australia’s strongest capital cities in terms of growth and economic potential
The Apple Isle continues to gain momentum in the property market as prices soar.
At the end of July 2017, Hobart recorded a year-on-year increase of 6.5% in dwelling values, according to CoreLogic. The median property price came in at just under $340,000 – the lowest among all of the capital cities.
“Australia’s most affordable capital city produced 15% price growth last financial year. It also has the best rental yields, lowest vacancy rates and tightest housing supply pipeline,” says Simon Pressley, managing director at Propertyology.
“We forecast that it is the only capital city in Australia with double-digit annual price growth potential over the next couple of years.” A significant contributor to this growth is the boost in the job market. As of May 2017, there were over twice as many employment opportunities in Hobart as in other capital cities. New infrastructure projects have also helped spur investor interest, such as the redevelopment of the Royal Hobart Hospital.
“A university city and foodie heaven, Hobart’s economy is benefiting from a boom in domestic and international visitors,” Pressley comments.
Tourism sets the bar
Given Hobart’s affordability and excellent prospects, private firms are looking into capitalising on the its appeal now to add further value to the city.
“Keep an eye out for large capital projects such as The Fragrance Group’s $240m application to build two hotels, including the tallest building in Hobart at 210 meters,” says Josh Hart, director at One Agency Launceston.
“If approved, this will set a new precedent for Hobart and for future developments.”
Mixed-use developments are helping to enhance the profile of Tassie cities outside Hobart as well.
“Developments for accommodation, retail and leisure known as The Silos and Penny Royal have boosted confidence in a city [Launceston] that is only a 45-minute flight from Melbourne,” Hart explains.
“For the savvy investor looking for a more aggressive opportunity, look out for short-term accommodation opportunities across Hobart and Launceston, with the shortage of quality hotel rooms.”
The University of Tasmania is also set to be relocated to Invermay on the outskirts of the Launceston CBD.
“This has made ‘in the know’ investors go into a tailspin securing property around the precinct, keen to attract students and faculty staff,” Hart explains.
These initiatives point to Launceston having much appeal for buyers in the near future. Over in Burnie, there are also plans to develop West Park as a technology and business hub.
SUBURB TO WATCH
LUTANA: Zinc producer evolves into hotspot
Originally established by the company Electrolyte Zinc as a place for its employees to settle in, Lutana has since become a fast-growing suburb that is popular with buyers because of its excellent location.
Lutana is just a 10-minute drive north of Hobart, and being near the Brooker Highway enhances its accessibility. It is also bordered by the River Derwent, which provides beautiful views of the water. Northgate Shopping Centre is close by to meet residents’ needs, and families have access to various schools, such as Sacred Heart College in New Town and the University of Tasmania in Hobart. Locals are also just a short distance away from the lively culture of the Hobart CBD.
