Australia’s top 10 in-demand suburbs head south

Forget Sydney. Interest in one city is soaring, taking up seven of the top 10 in-demand suburbs over the past six months.

North Hobart was in the top 10 along with six other suburbs in the Tassie capital.

As Sydney housing prices look out of reach for many prospective first-time buyers, interest is shifting south.

Interest in Hobart properties is soaring, with South Hobart topping a list of the most in-demand suburbs over the past six months on realestate.com.au.

The median price in South Hobart is $541,000 for houses and $351,000 for units, according to the listings website.

A three-bedroom, two-bathroom townhouse with outdoor entertainment deck and two balconies in the suburb has recently been listed for $395,000-plus, while another three-bedroom townhouse with three car spaces and located close to cafes is listed for $495,000.

Seven Tasmanian suburbs featured in the top 10 list, including Mount Stuart at number three, Battery Point at five, followed by Bellerive, Mornington, Hobart and North Hobart.

The median dwelling price across Hobart is $396,000 according to CoreLogic, up 12.7 per cent over the past year but significantly more affordable than the Sydney average of $906,000 and Melbourne’s average of $710,000.

An August report by property researcher CoreLogic found only three in every 100 houses that sold in Sydney over the past year changed hands for less than $400,000, while 7.4 per cent of units came under that figure.

One case in point was a fire-damaged, boarded-up four-bedroom house in Whalan, 39km west of the Sydney CBD that sold for $398,000 in December last year, while a three-bedroom 49km from the city sold for $350,000 the month before.

Even as the Sydney and Melbourne markets have started to slow amid regulatory clamps on lending and buyer exhaustion — Sydney prices fell 0.6 per cent over the past quarter — the east coast capitals are still a challenge for first-home hopefuls facing sluggish wages growth and low rates of return on savings.

Chief economist at realestate.com.au Nerida Conisbee said the Sydney market was slowing but conditions remained strong in Hobart.

“The drivers of popularity are not uniform across states, with affordability being a bigger driver in Sydney, compared to lower cost cities where popularity is still driven by lifestyle factors,” Ms Conisbee said.

“There is no guarantee that high demand will immediately result in strong price growth, but using history as a guide, high-demand locations do typically perform better.”

Buyers have also been looking at Melbourne’s outer east, with Briar Hill taking second spot and Warrandyte ranked fourth.

Allambie Heights in Sydney’s north, with a median house price of $1.7 million, rounded out the top 10.