Which Hobart suburbs are the best for property returns?

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Berriedale is Hobart’s latest housing hotspot. Picture: Supplied

Two of Hobart’s northern suburbs have been deemed the most lucrative areas to invest in property.

Exclusive PropTrack data shows Berriedale houses and neighbouring Claremont units provide the best bang for buck.

The report analysed capital growth, cash flow and rental days on the market.

In Berriedale, the median house price is $590,000, substantially less than greater Hobart’s median of about $700,000.

PropTrack found Berriedale’s median had risen by 6 per cent over the past year, delivering a rental yield of 5.1 per cent.

Its rental days on market — the time before a new lease is signed — was typically just 14 days sitting vacant between tenants.

Margate, West Moonah, Dodges Ferry and Chigwell were PropTrack’s next best hot spots.

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MIX Property Group has No.29 Twelfth Ave, West Moonah listed at $735,000-plus. Picture: realestate.com.au

No.23 Chardonnay Dr, Berriedale is for sale with LJ Hooker Pinnacle Property priced at “Offers over $845,000”. Picture: realestate.com.au

On the unit front, Claremont’s median value is $459,000, with 4 per cent annual growth, a 5.2 per cent yield and an average of 15 days on the market.

New Town and Howrah round out the top three unit options.

REA Group executive manager of economics, Angus Moore, said while past performance doesn’t necessarily predict future performance, there is some momentum in home prices.

“Strong performing areas tend to continue to perform strongly,” he said.

“Investors do need to go and dig in and understand the area and what’s been driving that, to figure out whether it’s going to continue.

“Locally specific factors are going to be very important.

‘This includes new builds, whether people are moving to the area from other states, big construction projects, or changes in local labour markets and employers.”

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REA Group economist Angus Moore.

Hobart buyer’s agent, David Zerna, said investor inquiry levels had about doubled through July and August.

“Investors are starting to pour back in,” the Timar Buyers Agency director said.

“We are seeing that investors are focused around the Glenorchy City Council area and that sub-$600,000 price point.

“And you can see it reflected quite prominently in PropTrack’s top 10 list of housing suburbs.”

Director of Hobart’s Timar Buyers Agency, David Zerna.

Mr Zerna said alongside this sub-$600,000 price, investors look for gross yields of about 5 per cent.

“Interestingly, they’re open to houses and units, which has been a bit of a shift for us,” he said.

“Most of this activity is being driven by buyers out of Sydney, with some also from Melbourne.

“Another trend I’m noticing is families taking their first step into investment.

“Many purchased their owner-occupier homes around 2019–2020, and now five years on they’re tapping into that equity growth to put it into an investment property for the future.”

Last week, a Real Estate Institute of Tasmania report revealed a steep increase in investor activity, with it growing by over 40 per cent compared quarter-on-quarter.

REIT president Russell Yaxley said a positive investment environment was key to a healthy property market and that “rental property sales outpacing rental supply is something we cannot afford”.

Peterswald has No.3/16 Mahoney Dr, Claremont on the market for $625,000. Picture: realestate.com.au

No.1/49 Hiern Rd, Blackmans Bay is for sale with Harcourts Kingborough, priced at “Offers over $610,000”. Picture: realestate.com.au

Meanwhile, Property Investment Professionals of Australia analysis of ATO data has revealed the steepest annual decline in individual property investors in over 25 years, excluding the GFC and Covid.

PIPA says the rental crisis is set to worsen with thousands of investors nationally exiting the market.

“Investors are selling up, and the homes they leave behind are often snapped up by owner-occupiers, permanently removing them from the rental pool, ” PIPA chairman Lachlan Vidler said.

TOP 10 INVESTOR SUBURBS – HOUSES

Rank Suburb Median sale price 12 month growth Rental yield Days on market

1 Berriedale $590,000 6% 5.1% 14

2 Margate $869,000 15% 4.0% 13

3 West Moonah $656,000 6% 4.7% 16

4 Dodges Ferry $728,000 21% 4.1% 16

5 Chigwell $477,000 5% 5.6% 19

6 Mornington $608,000 4% 5.1% 16

7 Moonah $635,000 4% 4.6% 15

8 Lindisfarne $785,000 6% 4.2% 18

9 Lutana $615,000 2% 4.8% 16

10 Claremont $554,000 4% 5.0% 18