Tasmania’s property market scorecard: Simon Pressley

GUEST OBSERVER

Recognised for its wilderness, tourism, and mining, the local government authority (LGA) of West Coast has officially produced the best total property investment return of all Tasmanian LGA’s over the last fifteen years.

The population of West Coast has declined over the last ten years and, according to 2014 Census, is a mere 4,527 people. When combined with its high unemployment and rather remote location it’s unlikely that even the most astute property investor would even bother typing ‘West Coast’ in to their search engine. But, the actual returns on investment have been absolutely spectacular.

$21,750 is what one would have paid for a typical house at the start of 2000 and, even though properties declined by 34% over the last 6 years, it would now be worth $70,000.  As they say, small fish taste sweeter!

West Coast’s average annual capital growth of 9.4% is well above the 8.0% national average for the same period. An 11.1% rental yield means that its total return of 20.5% has it ranked number four in Australia over the last 15 years. Yes, 4^th out of 550.

Propertyology conducted a study to compare the historical property market performance of each of Australia’s 550 local government authorities between 2000 and 2014. Given that some property markets have higher rates of growth and others have higher rental yields, Propertyology calculated the ‘total return’ (average annual growth rate plus rental yield) and we then ranked the LGA’s from 1 to 550 based on this performance.

Of the seven LGAs which make up the Greater-Hobart capital city, Derwent Valley was the highest ranked LGA at 24^th – impressive stuff! Hobart City was ranked a very respectable 147^th (ahead of every LGA in Sydney and Melbourne). Sorell (55^th) and Glenorchy (58^th) were ranked in the best 10% in Australia over the last 15 years.

29 of the total 550 Australian LGA’s are in Tasmania. Twelve of those LGA’s featured in Australia’s Top 100 (the best 20%). Australia’s smallest state bats well above its weight in respect to property market performers over the last 15 years.

These results are further proof that, in isolation, population growth is not a magic potion for property price growth. Data from ABS confirms that Tasmania’s population grew by an average of 0.8% per annum, the lowest of all states and well below the national average of 1.7% per annum.

Tasmania’s north performed particularly well. Kentish (32^nd), Burnie (59^th), Devenport (113^th), Launceston (87^Th), and West Tamar (153^rd) were strong performers. 

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SIMON PRESSLEY IS MANAGING DIRECTOR OF PROPERTYOLOGY, AN REIA HALL OF FAME INDUCTEE, PROPERTY MARKET ANALYST, ACCREDITED PROPERTY INVESTMENT ADVISER, AND BUYER’S AGENT. PROPERTYOLOGY WORKS EXCLUSIVELY WITH PROPERTY INVESTORS TO PURCHASE PROPERTIES IN STRATEGICALLY CHOSEN LOCATIONS ALL OVER AUSTRALIA.