Launceston house and unit values are on a tear and catching up to Hobart's, new data shows, with seven of the state's 10 fastest-growing suburbs by dwelling value in the year to May now in Launceston and the North East.
Subscribe now for unlimited access.
$0/
(min cost $0)
or signup to continue reading
Regional Tasmanian dwelling prices grew in value by 3.9 per cent in the three months to May - one of the fastest rates in the country - and much faster than in Hobart, where dwelling value increased by just 0.3 per cent over the same period, according to the latest data released by analytics firm Corelogic.
The value of units in Launceston and the North East grew by 4.6 per cent in the quarter - the fastest rate in regional Australia except Riverina in NSW - while Launceston houses grew by 2.6 per cent in the period.
By contrast, Hobart house prices increased by 0.3 per cent in the quarter, and units there increased in value by 2 per cent.
Median dwelling values in Hobart are still much higher than in the North, but the data shows the gap closing.
David Hernyk, a real estate agent at Harcourts in Launceston, said there were several reasons why Launceston dwelling values are catching up with Hobart's.
"What we found is investors are struggling to find a decent return - in Hobart, the return on investment is nearly non-existent [at current prices]. Also, the supply just isn't there in Hobart," Mr Hernyk said.
His firm has now started to refer investors that were looking to buy in the south of the state to areas in the north, including Launceston, Devonport and George Town.
"Financial planners - their clients are now looking outside of Hobart, they are getting outpriced in Hobart - it's hard to buy, they are overpaying, and if you do that it's hard to get a good return on investment."
According to Corelogic, the fastest-growing suburbs in the state are Evandale - which increased in value by 38.5 per cent in the year to May - Waverly (38 per cent) and St Marys (36.6 per cent).
Terry Robinson, managing director at Peter Lees Real Estate in Launceston, said the growth values seen in the data might have been distorted by the small numbers of sales in these suburbs.
But he agreed that Launceston, which has traditionally lagged the state capital, does seem to be catching up.
"It's a ripple effect - everywhere gets its turn. But people are becoming more aware of the value in the North," he said.
Harcourt's Mr Hernyk also noted that the recent outperformance of units was typical for Tasmania.
"Units have always done extremely well as we have an ageing demographic in Tasmania and there is a lot of demand from that [aged] population."
He also said the development of new units in the state has slowed, putting upward price pressure on existing units.
The other major trend pushing prices up across the state is the pandemic.
With other states on lockdown and Tasmania relatively lockdown-free, the trend for mainlanders moving to Tasmania accelerated, Mr Hernyk said.
"I used to get calls from [mainland] clients with a three to five-year plan to move to Tasmania. They are now ringing me with a plan to do that in the next year," he said.
Why not have your say? Write a letter to the editor here:
Our journalists work hard to provide local, up-to-date news to the community. This is how you can continue to access our trusted content:
- Bookmark www.examiner.com.au
- Make sure you are signed up for our breaking and regular headlines newsletters
- Follow us on Twitter: @examineronline
- Follow us on Instagram: @examineronline
- Follow us on Google News: The Examiner
