House prices in the remotest and coldest parts of Tasmania are soaring. Is it about low prices or lifestyle?

While the pandemic-driven tree-change movement may have slowed and even reversed in some parts of Australia, the same cannot be said for Tasmania, with some of the state’s most remote and coldest areas outperforming the capital, Hobart.

And it’s not just the price tag drawing property hunters away from the capital – despite the capital experiencing some of the most significant price rises during the pandemic – but a life of peace and tranquillity, with some ending up, quite literally, in the wilderness of our southernmost state.

Hobart has long reigned as Tasmania’s dynamite property market. In pre-pandemic 2020, the median house price was just $519,476 – and that was after a 37 per cent increase over the previous three years.

Now, it’s $709,275, according to the most recent Domain House Price Report. Its bumper price growth took a hit during the downturn last year, although prices were up by 1.2 per cent over the June 2023 quarter, annually, prices are down 6.9 per cent.

At the same time, the median house price for the rest of Tasmania came in at $543,000, up a whopping 9.7 per cent over the quarter, and 10.6 per cent year-on-year.

Analysis shows the majority of that growth is being led by some of the most remote and coldest regions in Tasmania.

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The median house price in the Central Highlands – which includes Wildness East, Derwent Valley and Southern Midlands – shot up by 12.2 per cent between April and June this year.

The region is home to the picturesque Great Lake and towns such as Miena, the coldest in Tasmania.

“Traditionally, this used to be a place where people purchased a holiday home or bought an investment property … but a lot of people are now considering the [Central] Highlands as their full-time residency,” says Nick Hay of Howell Property Group.

“While we’ve had strong interstate inquiries, many local Tasmanians are investing in the area. There have been some improvements in infrastructure such as road access, better services, hotels, community centres and a garden that are drawing people to the area.”

The median house price in the Central Highlands, although rising by 12.2 per cent in the space of just three months, is not coming off a low base. With a population of 12,848, the median house price is a hefty $830,000, higher than Hobart, as well as other capital cities like Brisbane, Adelaide, Perth and Darwin.

According to data from the Australian Bureau of Statistics, the population of the rest of the state, excluding Hobart and Greater Hobart, increased by 2000 in 2021-22.

But the Central Highlands is not nearly as expensive as the region of Huon-Bruny Island, which covers Bruny Island, Cygnet, Dover and Geeveston, where the median house price for the region was $1.32 million, up 10 per cent over the quarter and 8.2 per cent year-on-year. The region is home to 22,788 people.

According to Nyal Merdivenci of EIS Property, Huon-Bruny Island is well known for apple growing and craft cider makers.

“Cider-making businesses have particularly taken off, including Willie Smith’s Tasmanian Apple Cider from Grove, and Frank’s Cider in Franklin … and now it’s become a bit of a foodie hotspot for people,” he says.

Merdivenci likened the region to a small city with country benefits.

“There’s a great town here but you also have space – an attractive drawcard for interstate buyers. Most people want a big land area, not necessarily to use as a hobby farm or as such, but to have that space for privacy so that they’re not on each other’s doorsteps,” he says.

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“I recently sold a house in Mount River to a couple from NSW who had lived there their whole lives but decided to move to Tasmania and make the Huon Valley their home. They bought a four-bedroom, two-bathroom house on four acres of land and loved the space.”

Further, in Tasmania’s West Coast region, buyers are attracted to the affordability. With a population of 18,353, Domain data measured its median house price at $300,000, a figure that remain unchanged over the quarter, but it was up 20 per cent year-on-year.

“There’s definitely been a price increase in the last year but overall, house prices in the West Coast are much more affordable than what you’d get elsewhere,” says Nardi Stevens of Elders Real Estate Burnie.

The West Coast encompasses Zeehan, Strahan, Roseberry and Queenstown. And while many might think of Queenstown in New Zealand, this region of Australia is primarily remote and characterised by rugged landscapes and mountains. In fact, the West Coast region is a World Heritage-listed wilderness.

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“You’ve got to be a special sort of people to move to these areas,” says Stevens. “Obviously, these are untouched and beautiful areas but they are remote. You’re limited with shops and services and things like that but there are many who are able to look past that and are not necessarily worried about it.

“A lot of people who move here want a change of lifestyle … we have retirees too who, I think, move here because of that affordability factor as well. Some people have lived in the hustle and bustle of the main centres and just want to escape that.”

While price rises have been an encouraging factor across the remote regions in the past six to 12 months, the possibility of further interest rate rises is a concern for agents.

“The market is a lot more challenging now than it was 12 months ago because of the interest rate rises. It’s gone from 1.85 per cent a year ago to 4.1 per cent,” Merdivenci says. “So, there are some challenges there but some of these regions, like Huon Valley, are lifestyle locations, so hopefully, prices will hold moving forward.”