Investor comeback: The affordable capital city where confidence, home prices are rising

Hobart’s property market is set for a burst of competition this spring, as local real estate agents report an influx of property investors returning to the city. 

Hobart’s home prices have been steadily growing, with the city’s median home price rising 3.1% to $665,000 during the year to August, according to the latest PropTrack Home Price Index.  

Prices across the city have been recovering after a slower period, when some suburbs reported flat or dipping prices at times.  

But local agents have seen home prices on the move again and reported a notable return of interstate property investors to the city.  

Mathew Chugg, real estate agent at Elders Real Estate – Hobart, said property investors were back.  

“We lost the investors for a period of time, but they are definitely back,” he said.   

Hobart suburbs with the fastest growing house prices

“I think it’s due to home prices stabilising, interest rates going down, and our yields normally being pretty high here, so it’s a good combination for investors.” 

In the three months to June 2025, property investors took out the highest number of new loan commitments in Tasmania since mid-2022, according to the Australian Bureau of Statistics.   

Home buyers have been keeping a close eye on the Reserve Bank of Australia, which has cut interest rates three times this year, with most experts predicting at least one more cut in 2025.  

Affordability has also been a factor. Among the capital cities, Hobart has the second cheapest median home price after Darwin, which had a median home price of $550,000.  

The availability of homes for sale was also shaping Hobart’s market conditions, with fewer listings in Hobart compared to the same time last year, according to PropTrack figures.   

New property listings in Hobart were down 13.5% year-on-year in July, while total listings were 10.3% lower too. 

Hobart suburbs with the fastest growing unit prices

Real estate agent and sales manager at Peterswald, Bec Owens, said the Hobart property market had been very active during the autumn and early winter periods before conditions quietened a bit in August.

“September to December always picks up because it’s usually our strongest transacting months,” she said.

“Lots of appraisals are happening and people are preparing for market, so we’re bracing for that at the moment.”  

Within the Hobart property market, there was more activity at the more affordable end, according to real estate agent and director at 4one4 Property – Glenorchy, Patrick Berry.  

“Greater Hobart has been performing quite well – anything sub $650,000 or $700,000 is turning over relatively fast,” he said.  

“The higher-end properties are taking a little bit more time to sell, but any of those blue-collar worker entry-level homes seem to move relatively fast.”  

Looking ahead, Mr Chugg said there should be more sellers listing their homes for sale in the coming months.  

“There is a feeling in the air that there’s going to be an increase in property values due to a couple of drivers, including interest rate cuts and an increase in interstate buyers into our market over the spring months,” he said.  

“Our office has a big pipeline of properties coming in September and October, so I think there will be more properties coming to the market overall.” 

Mr Berry said buyer confidence was improving in the city as a result of rising home prices and falling interest rates.  

“Now that we are starting to see prices increase again, people are starting to believe the value is there, and are prepared and confident to buy,” he said.  

“When people hear about the interest rate cuts on the news, they do play into the minds of people purchasing in the area because they are quite tight on their budgets.”  

Ms Owens said the Hobart property market should see steady growth due to the current supply and demand conditions.  

“Like any market, if we continue to see the interest rate cuts that are widely predicted over the next year or so, then that should continue to strengthen the market,” she said.   

“The only thing that will slow it will be if we get an oversupply, but that hasn’t traditionally been a problem in Hobart.” 

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