Why property investors are heading to Hobart: HTW
Investor purchasing has increased in Tasmania, and according to the valuation firm, Herron Todd White (HTW) currently represents a 20% to 25% quota of residential property transactions.
Interstate investor activity has also increased, it noted.
"With Tasmanian investors achieving average gross yields of 5.2% and Hobart out performing all other capital cities it seems the returns on offer in Tasmania are capturing more investor attention," a recent report by HTW advised.
Some property market commentators are predicting that 2017 could see Tasmania turn over its highest volume of residential property sales in more than 10 years if property sales continue at the same pace as they have in the first half of this year.
The north has experienced the greatest percentage increase in residential sales volumes when compared to the same period last year.
"This may be as a result of reported stock shortages and capital growth in the south with buyers looking further a field for investment opportunities," HTW's report noted.
The upgrader or second home buyer price bracket is where buyers are most active within Hobart’s residential property market.
Glenorchy and Claremont are experiencing the greatest amount of entry level sales activity. Both suburbs are north-west of Hobart approximately 10 and 15 kilometres respectively north-west of the city centre.
It noted the Museum of Old and New Art (MONA), a popular tourist destination sits within a three kilometre radius of both Glenorchy and Claremont.
Examples of recent sales in Glenorchy include an older style, two bedroom, one bathroom unit in original condition which sold for $225,000 and an older style, dated, three bedroom, one bathroom home with single garage that backs onto Hobart’s show grounds that was purchased for $297,500.
In addition, a three-bedroom house at 46 Tolosa Street, Glenorchy (picture above) recently sold for $333,000.
Another three-bedroom house at 1-15 Malabar Road, Claremont sold for $317,500.
Sandy Bay, Kingston and Howrah are areas where upgraders or second home buyers are focusing their attention.
Sandy Bay is popular due to its position immediately south of the city with the Derwent River forming its southern border.
Contained within the suburb are the University of Tasmania campus, casino, private and public schools, local shops and recreational facilities. Recent sales within this price bracket in Sandy Bay include an older style, first floor, renovated, waterfront two bedroom, one bathroom unit with uninterrupted water views and single carport which recently sold for $850,000 and a renovated, four bedroom, two bathroom, period terrace that transacted for $985,000.
Within Hobart’s prestige market a modern Sandy Bay home offering five bedrooms, five bathrooms, indoor pool and double garage with views of the Derwent River recently sold for $3 million.
Similar levels of activity are occurring in the first home buyer and upgrader price brackets of the northern residential market, it noted.
The greatest activity occurring in Launceston’s more affordable suburbs is taking place in Newnham, Invermay and South Launceston.
Newnham is located approximately ve kilometres on the northern outskirts of Launceston and is predominantly residential with the University of Tasmania and The Australian Maritime College located nearby.
Properties that have recently sold in Newnham include a modern, two bedroom, one bathroom unit with one off street carpark which sold for $255,000 and an older style, renovated, five bedroom, two bathroom home with double garage that sold for $270,000.
Within the upgrader residential market segment Riverside, Newstead and Legana are proving to be the most popular with purchasers, HTW said.
Riverside is located along the western side of the Tamar River and is well contained with a shopping centre, public and private schools and sporting facilities. It is approximately a six kilometre commute to the city centre. A modern, four bedroom, three bathroom home with double garage and river views was recently sold in Riverside for $610,000 and a modern, three bedroom, two bathroom unit with river views and double garage sold for $360,000.
A recent notable sale in Launceston was for $1.4 million for a modern, four bedroom, three bathroom home located at Launceston’s Seaport overlooking the Tamar River.