Hobart’s shock property hotspots that surpassed glamour suburbs

Home prices have climbed higher in Bridgewater than any other suburb. Picture: Supplied

Two Hobart suburbs located 50km apart have something unexpected in common: city-topping home price growth.

In exclusive 30-year analysis of dwelling prices, PropTrack found that Bridgewater and Dodges Ferry outperformed Hobart’s glamour suburbs by a wide margin.

These suburbs were the only areas out of 36 suburbs where the 30-year price growth factor (PFG) was in double digits.

For Bridgewater, one of Hobart’s cheapest areas, the current median dwelling price is $421,000, which is 11.7 times higher than it was in 1995.

In beachy Dodges Ferry, the median has climbed to $567,000, with a PGF of 10.8.

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Bridgewater, Tasmania. Picture: Supplied

Greater Hobart dwelling prices have increased by a factor of 5.9, to a median of $680,190.

Richmond, West Hobart and Sorell round out the top five performing areas, with growth ranging from 7.9 to 8.6. Sandy Bay and Battery Point increased by a factor of 7.2 and 7.3.

REIT figures show Bridgewater’s median house price was under $100,000 as recently as 2003.

PropTrack economist Angus Moore said in 1995, the suburb’s median dwelling value was in the mid-$30,000s.

He said the research used PGF rather than expressing the change as a percentage because percentages were harder to envision when they are large.

“When the change is over 1000 per cent, a growth factor figure is easier to understand,” he said.

“The Hobart data showed a bit of a mix in the top performing areas, it was not dominated by all affordable or all expensive suburbs.”

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PropTrack economist Angus Moore.

While Bridgewater is a suburb that was built for public housing, there are pockets of new development that have sprung up.

EIS Property’s Joel Nielsen has listed eight high-quality, affordable new units in Nielsen Esp for Loreto Community Housing. The property consultant said they were designed specifically for MyHome share scheme buyers.

“Bridgewater has become increasingly popular with first homebuyers and investors,” he said.

“For first-time buyers, it remains one of the more affordable suburbs compared to others in the region.

“For investors, the attraction lies in the combination of a low entry price point and strong rental yields.”

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Mr Nielsen said, with the completion of the Bridgewater Bridge, commuting to the city takes only 25 minutes.

“The suburb offers excellent amenities, shopping centres, medical facilities, a Services Australia office, and proximity to the Brighton Transport Hub, making it a convenient and well-connected location.”

Units at No.14 Nielsen Esp, Bridgewater are listed with EIS Property and priced at “Offers over $445,000”. Picture: Supplied

Units at No.14 Nielsen Esp, Bridgewater.

Mr Moore said the forces driving price rises over the past 30 years were complex, but could be broadly categorised by changes in supply and demand.

He said the country was building far fewer homes relative to population growth, creating supply shortages and this coincided with a “structural” downward shift in interest rates, giving buyers access to more debt.

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No.4 Chaffeys Dr, Dodges Ferry is for sale with Kate Storey Realty at $560,000-plus. Picture: realestate.com.au

Fall Real Estate has No.11 Fifth Ave, Dodges Ferry on the market for $750,000. Picture: realestate.com.au

He said the RBA’s cash rate peaked at 17.5 per cent in early 1990, dropping to 0.1 per cent in 2021. It’s currently 3.6 per cent, with banks offering loans at about 5.5 per cent.

“Rates used to be higher and more volatile, but lower rates mean people can service larger mortgages.

“Prices can be structurally higher because rates are structurally lower and more stable than was true during the early 1990s.”

No.1, 30 Cheswick Crs, Bridgewater is priced at $545,000-plus with Ray White Hobart. Picture: realestate.com.au

Priced at $489,000-plus, No.2 Maxwell Dr, Bridgewater is for sale with BellParker@homes. Picture: realestate.com.au

Mr Moore noted the home price growth hasn’t matched wage rises.

“Incomes have not grown tenfold over this period, like home prices. Home price growth has far outstretched wages and was much higher than inflation,” he said.

“That may not help much if people are staying put, but if they are downsizing or moving on and are in position to unlock that equity, they could have a substantial amount of wealth.

“It’s hard to forecast 30 years ahead, but it’s less likely we will have this same level of growth again.”

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