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27-10-2015, 09:56 PM
- Oct 27 2015 at 2:23 PM
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[img=620x0]http://www.afr.com/content/dam/images/1/1/c/a/g/9/image.related.afrArticleLead.620x350.gke1o9.png/1445923251989.jpg[/img]Looking good in Hobart: A hotspot for investors and owner-occupiers, PRDnationwide says.
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by Michael Bleby
A seven-fold increase in infrastructure spend in and around Hobart is creating affordable real estate hotspots for investors and owner-occupiers, real estate agency, PRDnationwide says.
The rise in infrastructure spend to $123 million this year from $17.4 million last year is boosting price growth of houses and apartments in areas such as Howrah, Rokeby and Glenorchy, PRD's latest Hotspots report shows.
"With great affordability and major support in the form of large upcoming infrastructure spend, Hobart will become a hotspot for first time home buyers and investors alike," said PRDnationwide national research manager Asti Mardiasmo.
Locals agree.
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"In the last six months, property prices have lifted dramatically here," said Michael Kerschbaum, the executive director of Master Builders Tasmania. "We've had an incredibly hot spring in terms of prices."
The perennial under-performer of the Australian property market, Hobart is now a growing attraction for people priced out of other markets. The median Hobart house price in the September quarter was $346,370 and the median apartment price $269,302 - both the lowest in the country - last week's quarterly report from Fairfax Media-owned Domain showed.
Earlier this month SQM Research director Louis Christopher said Hobart would be one of Australia's best-performing property markets in 2016, along with Melbourne and Gold Coast and that rents would grow between 5 per cent and 8 per cent as vacancies fell.
The growing market of mainlanders seeking a lifestyle change made locations such as Byron Bay and Hobart good opportunities, CoreLogic RP Data head of research Tim Lawless said in August.
Price growth of houses in Howrah, a suburb across Derwent River and 12km from the CBD, has picked up to an annualised 2.8 per cent in the year to September from just 0.5 per cent six months earlier, boosted by projects such as the $1.5-million, 98-lot Minno Street residential subdivision, the PRD report shows.
Neighbouring Rokeby has undergone a bigger lift, with projects such as the $5-million King St-Mockridge Rd residential subdivision, which is creating 180 new lots, giving houses in the suburb a 5.6 per cent annualised boost to prices. Six months ago, they were falling 5.3 per cent a year.
In Glenorchy in the city's north unit prices, which were falling at an annual pace of 7.1 per cent six months ago, have turned around and are now gaining at a 5.1 per cent clip. The median unit price in Glenorchy, the blue-collar former home of MONA founder David Walsh, is $205,000.
Another pick-up has occurred in Bridgewater on Greater Hobart's northern edge, where units that six months earlier were growing at a pace of 0.5 per cent, are now enjoying a 9.9 per cent rate of gain. Despite the lift, the median unit price in Bridgewater - is a modest - by mainland standards - $155,000, the PRD report shows.