Hobart housing affordability remains stable

A national report shows Hobart housing affordability sat flat over the past three months. Picture: Roger Lovell

The amount of household budget needed to cover mortgage payments in Tasmania has not budged much over the past quarter.

The latest Real Estate Institute of Australia Housing Affordability Report showed Tassie households dedicated 43.4 per cent of their income to loan repayments in March.

The 0.1 per cent improvement compared to the December quarter was the smallest shift among the states.

Tasmania’s expensive rental market was behind only NSW, with 26.8 per cent of family income required to meet rent payments. While slightly up compared to the previous quarter, this result was down from 27.4 per cent at the same time last year.

The report also found that the number of loans to first home buyers in Tasmania decreased to 489. This was a decrease of 5 per cent over the quarter, but an increase of 15.3 per cent over the past year.

Real Estate Institute of Australia president Leanne Pilkington. Picture: Supplied

Of the total number of Australian first home buyers who purchased during the March quarter, 1.9 per cent were from Tasmania.

First home buyers made up 32.4 per cent of the state’s owner occupier market.

Over the March quarter 2025, the average loan to first home buyers increased to $446,421. This was an increase of 5.4 per cent over the quarter and 8.8 per cent over the past year. The total number of loans for all owner occupiers decreased to 1510. This was a decrease of 3.6 per cent over the quarter, but an increase of 11.7 per cent over the past year.

Tasmania had the lowest decline of new loans over the quarter.

Tasmania’s average loan size increased to $487,020. This was an increase of 2.9 per cent over the quarter and 8.9 per cent over the past year.

REIA president Leanne Pilkington said “all states and territories saw housing affordability gains, with the exception of the Northern Territory, however Tasmania recorded the smallest improvement”.

While the overall market improvements offer some relief, Ms Pilkington said, “it’s too early to declare a full-scale recovery in affordability,” adding that sustained interest rate settings and wage growth will be key to maintaining this positive momentum.

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Meanwhile, property valuer Mark Davies wrote about purchasing property for around the median price — about $700,000 for houses, $526,000 units — for Herron Todd White’s monthly report, and noted that whether or not a property represents good buying at the median price depends heavily on its location, condition and future potential.

Mr Davies said in Hobart’s inner suburbs — Sandy Bay, North Hobart, Battery Point — the median might only stretch to smaller homes or units, but the location offers enduring demand and strong resale value.

Petrusma Property has No.521 Huon Rd, South Hobart on the market for “Offers over $699,000”. Picture: realestate.com.au

He said the middle ring properties — Lenah Valley, Moonah or Glenorchy — often provide the best balance of price, space and proximity, while outer ring properties — Brighton, Sorell and New Norfolk — offer value for money but come with more risk in terms of long-term capital growth.

“Buyers should exercise caution when purchasing properties at the median price in rapidly developing outer suburbs,” he said. “These areas can be more susceptible to oversupply, slower infrastructure rollout and economic fluctuations.”

Hobart’s market is expected to remain stable, with modest price growth predicted over the next 12 to 18 months, Mr Davies said.

No.2 Young St, Glenorchy is for sale with Peterswald at $695,000-plus. Picture: realestate.com.au

No.4 Dent Court, West Moonah is for sale with Fall Real Estate for $680,000-plus. Picture: realestate.com.au

“Population growth, tight rental conditions and lifestyle appeal will continue to underpin demand, particularly in well-serviced suburbs,” he said.

“Houses in desirable school catchments and units in boutique, well-located complexes are likely to perform well.

“As interest rates begin to reduce, we may also see renewed interest from interstate buyers, which could lift competition.

“Buying at the median price in Hobart doesn’t guarantee a quality asset.

“What matters most is how wisely you spend that budget.

“Whether you’re looking for a character home in the inner ring, a family-sized house in Glenorchy, or a high-yield villa in Claremont, the focus should always be on long-term fundamentals: land value, location, and quality.”

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