Whether you’re a beginner property mogul, a budding rentvester, or you’re looking to grow your existing real estate portfolio, opening up your search criteria to include that little island down south could be the key to unlocking a powerful investment strategy.
It’s a great time to ponder investing in Tasmania, as the boom conditions of the past few years have eaten into rental yields in Melbourne and Sydney, and investors are still wary of the recovering market in Perth.
Buy-and-hold rental properties have always been the mainstay of the investor market in the Apple Isle, as capital growth has historically lagged behind that of mainland capitals. However, with Hobart looking like it will be the strongest performer in the nation in 2018, there’s newfound potential for quick profits in the short term.
Where to consider investing in Tasmania
If you’re thinking of investing in Tasmania, the capital city Hobart is a great place to start. Units in close proximity to the University of Tasmania (UTAS) are an obvious choice, while family homes in the northern suburbs tend to be a sound investment.
In Glenorchy, a three-bedroom unit should command around $340 per week and set you back just $295,000, while a four-bedroom house could fetch $400 per week and be added to your portfolio for a touch over $400,000. A family suburb with plenty of schools, shops and parks nearby, Glenorchy has yet to be caught up in the price growth wave that’s sweeping across greater Hobart, so you can still snap up a bargain.
Read more: Tasmania’s most expensive suburbs
Meanwhile, house prices in ritzy Sandy Bay, near UTAS, may be a little outside your price range, the median unit price remains under $500,000, and three-bedroom unit rent at around $467 per week. These properties tend to be vacant for just 20 days between tenants, thanks to the need for affordable student accommodation in the area. A property here could also make a great holiday let, with the CBD, Wrest Point Casino and waterfront dining all within easy reach.
Two-bedroom units rent for $292 per week in Invermay, while in Newnham you can expect about $330 per week for a three-bedroom unit. With these types of properties selling for around a median of $187,000 and $169,000 respectively, they are temptingly affordable, and unlikely to be vacant for long. Do your research though, as these inner-north suburbs do have the odd undesirable pockets you’d be well-advised to avoid.
Not into city living?
On the northwest coast, real estate is even more affordable, and the strong rental market makes it a sound choice for investing in Tasmania.
In the town of Penguin, the median rent for a three-bedroom house is $285 per week, while two-bed units command around $245 per week. Houses take, on average, just 19 days to find new tenants, and the median selling price is $270,000 – your property could even boast stunning ocean views, for less than the price of a cubby house in Sydney! This tiny timber town has a population of just 4000 people, but draws a crowd on Sundays when it plays host to a massive undercover craft and vintage market.
If you’ve been toying with the idea of investing in Tasmania, there’s no time like the present. If forecasters are correct, Tassie’s exceptional affordability could soon be a thing of the past, so get in quick!