Chief Economist at the Macro Investor Leith van Onselen shared his 12-month price forecasts for Australia’s capital city housing markets based on consideration of key price drivers: housing finance; housing supply; affordability; and the macroeconomic outlook.
Hobart: -7% to -4%
Hobart’s housing market has been one of the weakest performers in the nation, declining by 11.8 per cent (houses) and 8.9 per cent (units) from peak as at May 2012, according to RP Data-Rismark.
A broad range of indicators suggest that Hobart housing is unlikely to improve any time soon, with prices predicted to decline by a further 4 per cent to 7 per cent over the next 12 months.
Housing affordability is not a key concern in Hobart, with home prices amongst the lowest in the nation compared to both incomes and rents.
Rather, the supply situation is deteriorating, with the number of homes for sale some 20 per cent higher than a year ago and dwelling construction rates relative to population growth running well above the national average. Similarly, rental vacancy rates in Hobart are around 50 per cent higher than this time last year and are the second highest in the nation after Melbourne.