Downturn done? Hobart home prices stabilise in May

The tides may have turned for house hunters hoping to snag a bargain in Hobart, a report has revealed.

AFTER 13 months of receding home price figures, Hobart has posted its first green shoots.

PropTrack’s May Home Price Index shows 0.07 per cent month-to-month growth in the southernmost capital city.

Most recently, homes trended 0.27 per cent lower in April, 0.43 per cent less in March, and 0.05 per cent down in February.

The 0.7 per cent increase was the smallest of any city or regional market, but ahead of declining areas such as regional NSW, regional Victoria and Darwin.

Hobart’s annual percentage of growth for homes — houses and units combined — sits 5.7 per cent lower than it was at this time last year.

However, the market’s growth since the pandemic started is 39.2 per cent, the third highest of the capitals behind the nation’s hottest markets, Adelaide and Brisbane.

Hobart home prices have shifted to growth.

Hobart’s home median is now $663,000. This is higher than Adelaide, Perth and Darwin.

PropTrack senior economist Eleanor Creagh said although interest rates are at or close to peak levels, they may still rise further. And the economy is expected to slow.

“These factors may weigh on home prices in the months ahead,” she said.

“However, the continued tightness in the labour market, stronger housing demand and the limited supply environment are likely to support an ongoing recovery.”

Ms Creagh said Hobart’s housing market conditions had improved this year.

She said auction clearance rates were rising and housing demand was strong relative to the stock on the market.

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In regional Tasmania, the report showed 0.27 per cent monthly home price growth and a 0.29 per cent annual reduction.

Regional Tassie’s median home value is $499,000. It is up by a nation-leading 52.9 per cent since Covid’s onset.

Eleanor Creagh, PropTrack senior economist.

Meanwhile, Finder’s Consumer Sentiment Tracker shows 21 per cent of Tassie homeowners are struggling to pay their mortgage, while 22 per cent think now is a good time to buy property.

Almost half of the Tasmanian survey respondents (46 per cent) expect property values in their local area to increase in the next 12 months.

Finder’s Graham Cooke.

Finder’s head of consumer research Graham Cooke said the widely forecast “big crash in pricing did not fully eventuate”.

“We are starting to see some cities return to growth, and this is likely affecting people’s outlook,” he said.

“This is why we are seeing some positivity in Tasmania.

“Of course, nobody really knows what’s around the corner.”

HOME PRICE INDEX MAY 2023

Monthly change, annual change, median value, growth since Covid

Sydney 0.58% -1.96% $1.019m 25.4%

Melbourne 0.22% -4.32% $797,000 14.9%

Brisbane 0.33% -1.3% $725,000 45.1%

Adelaide 0.58% 5.6% $660,000 47.6%

Perth 0.64% 4.21% $571,000 33.1%

Hobart 0.07% -5.7% $663,000 39.2%

Darwin -0.01% -0.93 $497,000 26.2%

Canberra 0.65% -4.63% $836,000 35.6%

Source: PropTrack all dwellings data