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The second oldest capital city after Sydney and what a great underdog story. Nearing the end of 2003, the housing market had hit rock bottom. The state had record unemployment, the once buoyant forestry industry was in sharp decline and tourism was sluggish. The following years saw a decline in property values, high vacancy rates and tough economic conditions. However, over the past 12-months things have certainly changed and all indicators are pointing to Hobart being Australia’s best-performing capital city in 2017.
Let’s take a look at why this is:
- The Tasmanian government committed 1.8B in infrastructure projects as part of the 16/17 budget
- Tourism has been key to the recovery of the state; illustrated by the increase of international visitors by 13% while their expenditure increased by 23%*
- The above has promoted a stronger economy, creating an influx of job opportunities
- Housing affordability in Sydney and Melbourne is driving native Tasmanians home and a migration of mainland residents
- A cultural shift in remote working is allowing these residents to migrate whilst still retaining their mainland employment.
Hobart offers a vibrant lifestyle filled with history, picturesque scenery, rugged wildlife and gastronomical delights! Everyone's taste buds are covered with hi-end hatted restaurants like Franklin and cool bars of Salamanca Place. It wouldn’t be a blog on Tasmania and Hobart if we didn’t mention the Museum of Old and New Art (MONA), opened in 2011, it’s being credited in many circles as the southern states renaissance. Since opening, 1.7M people have walked through its doors.
Let’s look at the housing and economic figures:
- Stock on market is taking a sharp downturn while the population is increasing causing a large supply and demand issue
- The vacancy rate sits at 0.5%, being the lowest in Australia
- Houses and units gained 11.71% and 6.07% respectively in 2016
- In the CommSec State of the States report, Tasmania is up to 4th position from 7th on performance rankings
- Annual growth in home lending is strongest in the nation at 10.3%
- In January 2017, the unemployment rate in Tasmania was estimated to have decreased by 2.5% to 5.9% (national average is 5.7%)
- Tasmania government population growth strategy is aiming to increase the population to 650,000 by 2050 (current population 520K).
We believe Hobart is in a rising market and there are some great buying opportunities. Although any investment must be closely monitored as the capital city is so reliant on tourism. This market can drop as quickly as it has risen.
Milk Chocolate purchase residential and commercial property in Australia on behalf of Australians living abroad, looking for a home or investment property. To see how we can help you get in touch here.
*For the year ending June 2016
Sources: Make it Tasmania / Fairfax Good Food Guide / ABC News / Tasmanian Government /
Department of Treasury and Finance / Department of State Growth / Tradingeconomics.com /
CoreLogic / Your Investment Property / Herron Todd White / Hobart Mercury / Tourism Tasmania / CommSec Stat of the States Report / SQM Housing Boom and Bust Report / Sydney Morning Herald / News.com.au
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