Tasmania’s real estate boom continues with new figures showing rises in rents for both houses and units over the last year were the highest in the country.
The Domain Rental Report for the June quarter revealed Hobart was the only capital city market to record double-digit growth for rents over 12 months.
Median house rents increased to $410 a week, an annual increase of 13.9 per cent, while unit rents rose to $360 a week, a 12.5 per cent jump.
Domain said despite house prices declining by 2.4 per cent in the June quarter, rises over the other nine months kept the annual figure high.
Domain data scientist Nicola Powell said the June quarter drop was a seasonal change that the market usually experienced at the start of winter.
“In terms of house rents, we saw a double-digit growth in Hobart and Canberra, Hobart grew 13.9 per cent and Canberra grew 10 per cent,” she said.
“In the space of two years, Hobart had moved from [being] one of the most affordable rental markets.
“Now it sits behind Perth, Adelaide and Brisbane for houses, and for the unit market it sits behind Adelaide and Perth and is certainly closing the gap on Brisbane,” she said.
Building boom to relief the market
New figures from the Australian Bureau of Statistics also revealed a major increase in dwelling construction in the state.
In the March quarter of 2018, dwelling commencements were up 31.4 per cent compared with the same time last year.
Tasmanian Treasurer Peter Gutwein described the increase as “massive”.
“The solution to the current housing shortage is to build more houses,” he said.
“These encouraging figures confirm our long-term plan is working.”
Mr Gutwein said the building starts were the highest growth rate in Australia and nearly ten times the national average.
Domain’s Nicola Powell said the tight Hobart market would be relieved by the new housing stock arriving for sale.
However relief was not likely until early 2019.
“What we are still seeing is advertised listing for rental stocks continuing to decline, but it’s certainly not declining at the great pace that we did see last year and the year prior,” she said.
“I think what Tasmania has experienced is an increase in population growth from the turnaround of interstate migration.
“When you look at the tourism market, Hobart has reached record highs and perhaps it is an indication that some of the the rental stock is being offered for short-term leases rather than long term.”