Hobart top Aussie market for capital growth

Hobart has emerged as Australia’s strongest market for price growth, while in Queensland, the Sunshine Coast has edged in front of bigger cities Gold Coast and Brisbane to be the state’s best performer.

Recent research by Knight Frank named the Tasmanian capital as Australia’s best performing city in its Global Residential Cities Index, which tracks movement in residential property prices across 150 cities worldwide.

Hobart was ranked 13th overall to be the top Australian city, with its annual price growth from midway through last year to the end of June of 10.8 per cent.

Sydney was ranked 20th at 9.4 per cent, Melbourne 37th at 6.8 per cent, while Canberra was 39th at 6.7 per cent.

Knight Frank head of residential Shayne Harris said Hobart’s relative value and lifestyle proposition were attractive to mainland buyers prior to COVID-19, while the crisis only enhanced its appeal.

“Tasmania has seen increased popularity by those seeking a regional tree-change, especially now when we have officially seen the success in the adaptability of many white-collar workers working from their homes,” Mr Harris said.

“Sydney continues to be underpinned by a severe shortage of stock for sale by both auction and private treaty and this has been reflected by the high clearance rates recorded.

“In the past couple of months difficulties around obtaining finance has drawn out many Sydney sale transactions and this still remains a hurdle, but in the past few weeks, I’ve been taken back with the increasing number of registered bidders at auctions.

“In some instances, we are once again seeing first home buyers being outpriced by downsizers and this is most likely to continue given their lower reliance on steady employment and a reasonable performing stock market.”

Meanwhile, Sunshine Coast houses and units continue to record solid price growth, with population growth in the region at its highest point in around 10 years.

In the year to the end of June, research by CBRE showed median house prices on the Sunshine Coast rose by 3.8 per cent, while the median unit price rose 2.4 per cent in the same period.

On the Gold Coast, house and unit prices were up 3.1 per cent and 1.7 per cent, respectively, and in Brisbane price growth was 1.3 per cent for houses and 1.7 per cent for units.

CBRE senior managing director of residential valuations Jarrod Fazer said the prevalence of people working from home had resulted in significant transactional activity on the Sunshine Coast.

“Regional and satellite residential property markets are experiencing remarkable resilience in the face of COVID-19,” Mr Fazer said.

“Places like the Sunshine Coast are reaping the benefits of a Zoom boom, with people realising that the world has probably changed forever in relation to their ability to stay connected via video conferencing.

“Over the past few months, we’ve seen people who were considering a sea-change to the Sunshine Coast bring that decision forward due to COVID-19. 

“Being able to connect to the workplace remotely via video conferencing has made it easier for people to enjoy benefits of a regional lifestyle, while keeping their capital city jobs.” 

More than 5,660 houses were sold over the 12 months to the end of June on the Sunshine Coast, a 6.4 per cent uptick on the previous year.

The city has recorded population growth of 2.7 per cent per year over the past three years, with a net population increase of 25,500 people, the strongest sustained increase since the early 2000s.

Around 60 per cent of new residents to the Sunshine Coast were from other parts of Queensland, while 30 per cent came from NSW or Victoria.