31% of Hobart house sales below $300,000: Is the Apple Isle ripe for investor harvesting?

31% of Hobart house sales below $300,000: Is the Apple Isle ripe for investor harvesting?
Jonathan ChancellorFebruary 4, 2015

The Real Estate Institute of Tasmania (REIT) has released its December Quarter Property Report revealing both an increase in house sales volume and the median house prices for the quarter.

REIT president Tony Collidge said the median house price for Tasmania saw a 4.5% increase for the quarter to $315,000, the highest median house price recorded since December 2010 when the state’s median house price peaked at $320,000.

The report also revealed a slight increase in house sales volume across the state up 3.1% on the previous quarter.

Hobart’s median remained steady for the quarter at $360,00. Launceston’s median house price rose 7.2% for the quarter, a 3.3% increase on December 2013.

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Source: REIT

Nine municipalities had a median price higher than the state median. These were Clarence ($370,000), Hobart ($475,000), Huon Valley ($349,000), Kentish ($333,500), Kingborough ($395,000), Latrobe ($344,500), Meander Valley ($320,000), Sorell ($325,000) and the Southern Midlands ($340,000).

“Breaking these figures down into regions, we can report that house sales in Hobart increased for both the quarter and the year, up 11.2% and 2.4% respectively," said Collidge.

“Launceston house sales were also up, recording a 5.1% increase for the quarter, while the North-West centres bucked the trend, reporting an 11.5 decrease for the quarter.”

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Source: REIT

Collidge said whilst increases in median house prices were observed across most of the state, the price distribution of sales differed significantly.

“Hobart saw 31% of all house sales occur below the $300,000 price point, while 59% occurred between the $300,001 and $600,000 bracket, and 10% of sales came in above that price, which included 10 sales up to and above $1 million dollars,” he said.

“While in Launceston, 58% of the quarter’s sales were recorded below $300,000, 40% between $300,001 and $600,000, while only 2 two% of all houses sold were above this price point.

“In contrast, the North West Centres saw 76% of all house sales occur below $300,000 and the remaining 24% fell into the bracket of $300,001 - $600,000."

“It’s interesting to note the appearance of a wide range of regional areas in Tasmania making it onto the list of locations with higher median house prices compared to the state average.

“The removal of the First Home Owners Grant on 1 July for purchasers buying established dwellings, resulted in a marked decrease in house purchases from first home buyers, with sales from this market segment dropping from 17%, to now sit at 13% of all house sales.

“Second home buyers picked up the 4% loss in first home buyers and continue to hold over half the market, accounting for 57% of house sales and a median house purchase price of $330,000.

“The report also revealed that 10 percent of sales occurred to overseas purchases while interstate buyers remained steady at 15% for the quarter.”

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Source: REIT

Jonathan Chancellor

Jonathan Chancellor is one of Australia's most respected property journalists, having been at the top of the game since the early 1980s. Jonathan co-founded the property industry website Property Observer and has written for national and international publications.

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