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Hobart's rental market has become one of Australia's tightest, with vacancy rates sitting at just 0.6% as of September 2025. Average house rents reach $585 per week while units average $504 per week, making the city more affordable than mainland capitals but increasingly competitive for tenants.
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Hobart's rental market shows strong fundamentals with extremely low vacancy rates and steady rent growth of 8.9% year-on-year for houses.
Property investors can expect gross yields of 4.1-4.4% for houses and 4.5-5.6% for units, with rental income often covering most mortgage costs in today's market.
| Property Type | Average Weekly Rent | Gross Yield Range |
|---|---|---|
| Houses (3 bedroom) | $585 | 4.1% - 4.4% |
| Units/Apartments | $504 | 4.5% - 5.6% |
| Central Hobart Apartments | $530 - $620 | 4.2% - 4.8% |
| Suburban Houses | $530 - $600 | 4.1% - 4.4% |
| Premium Locations (Battery Point) | $705 (houses) | 3.8% - 4.2% |
| Outer Suburbs (Brighton) | $530 (houses) | 4.8% - 5.2% |
| One-bedroom Units | $420 - $480 | 5.0% - 5.8% |
What's the average rent in Hobart right now by property type?
As of September 2025, Hobart's rental market shows clear distinctions across property types.
Houses command the highest rents with a median of $585 per week, while three-bedroom houses specifically average $582 per week. Units and apartments sit lower at $504 per week median, with two-bedroom units averaging $517 per week.
Townhouses aren't always tracked separately in official statistics, but they typically fall between units and houses in pricing. Most townhouses in Hobart rent for $500-$550 per week depending on their size and location.
These figures represent significant increases from previous years, with house rents up 8.9% year-on-year and unit rents climbing 8.5% over the same period.
How does rent vary between different suburbs and areas of Hobart?
Location dramatically impacts rental prices across Greater Hobart, with premium suburbs commanding substantial premiums over outer areas.
| Suburb | House Rent (Weekly) | Unit Rent (Weekly) |
|---|---|---|
| Battery Point | $705 | $550 |
| Sandy Bay | $673 | $495 |
| North Hobart | $600 | $500 |
| Kingston | $600 | $500 |
| Bellerive | $613 | $485 |
| Glenorchy | $550 | $460 |
| Moonah | $550 | $480 |
| Brighton | $530 | $445 |
| New Norfolk | $450 | N/A |
Central locations like Battery Point and Sandy Bay command the highest rents due to their proximity to the CBD, waterfront access, and heritage appeal. Outer suburbs like Brighton and New Norfolk offer more affordable options but require longer commutes to the city center.
What's the average rent based on property size?
Property size directly correlates with rental prices in Hobart's market, though location remains a significant factor.
One-bedroom units typically rent for $420-$480 per week depending on location and quality. These properties are popular with young professionals and students seeking affordable accommodation near the CBD or university.
Two-bedroom units average $470-$520 per week across most suburbs, making them attractive to couples and small families. The price range reflects both location and property condition variations.
Three-bedroom houses represent the most common family rental option, averaging $580-$620 per week in most suburbs. Premium locations can push this range significantly higher, while outer suburbs may fall below the lower end.
Larger properties with four or more bedrooms command premium prices, often exceeding $650 per week in desirable locations.
What's the total cost for property owners after all expenses?
Property ownership in Hobart involves several ongoing costs beyond the mortgage payment.
Property management fees typically consume 5-10% of annual rental income, with CBD apartments averaging 7-9% and suburban or heritage homes reaching 8-12%. Additional letting fees range from 1-4 weeks' rent when securing new tenants.
Council rates average $1,200-$2,500 annually depending on property value and location. Landlord insurance typically costs $300-$800 per year for adequate coverage.
Maintenance and repairs require budgeting $1,000-$5,000 annually, with older properties and heritage homes requiring higher allocations. Income tax applies to net rental income, while land tax kicks in above certain property value thresholds.
For a typical $600 per week rental generating $31,200 annually, owners should budget approximately $3,000 for management, $2,000 for rates and insurance, and $2,000 for maintenance, plus applicable taxes.
How do mortgage payments compare to rent collected?
Hobart's mortgage-to-rent ratio has tightened considerably with rising interest rates and property prices.
Average monthly mortgage payments in Tasmania range from $2,830-$2,992, equating to $653-$690 per week for an average home loan of $458,641 at 6.2% interest rates. These figures reflect current market conditions as of September 2025.
Rental income from the same properties typically generates $554-$585 per week for houses, meaning mortgage payments often exceed rental income by $70-$135 weekly. This gap represents a significant consideration for property investors.
Most houses yield 4.1-4.4% gross returns, meaning rental income covers most mortgage interest but rarely the full principal and interest payments. Investors often need additional income sources or rely on capital growth to make investments viable.
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What are example rental prices for different property types?
Specific examples illustrate Hobart's rental price variations across property types and locations.
A central Hobart two-bedroom apartment typically rents for $530-$620 per week, offering convenience to CBD workers and university students. These properties often include modern amenities and public transport access.
Premium locations like Sandy Bay or Battery Point command top prices, with houses reaching $673-$705 per week and units $495-$550 per week. These areas offer heritage charm, harbor views, and prestigious addresses.
Suburban houses in areas like Kingston, Brighton, or Glenorchy rent for $530-$600 per week, providing family-friendly environments with larger yards and parking. Units in these areas typically rent for $445-$480 per week.
Budget-conscious renters can find options in outer areas like New Norfolk, where houses rent for around $450 per week, though commute times to central Hobart increase significantly.
What tenant profiles are most common in Hobart?
Hobart's rental market serves diverse tenant demographics, each with distinct housing preferences.
1. **Students** represent a significant portion of the rental market, particularly around Sandy Bay and the CBD due to University of Tasmania proximity. They typically seek affordable units or shared housing arrangements.2. **Young professionals** gravitate toward inner suburbs like Battery Point and North Hobart, valuing walkability to work and entertainment districts while accepting higher rents for convenience.3. **Families** dominate suburban rental markets in areas like Glenorchy, Kingston, and Brighton, seeking larger homes with yards and good school access at more affordable price points.4. **Retirees** increasingly enter the rental market seeking downsized accommodation in quieter suburbs, often after selling family homes to fund retirement.5. **Interstate migrants** arriving for work opportunities often start as renters while familiarizing themselves with different areas before potential property purchases.What are the current vacancy rates by area and property type?
Hobart maintains one of Australia's tightest rental markets with extremely low vacancy rates across all areas.
The overall vacancy rate sits at just 0.6% as of September 2025, down dramatically from 1.4% a year earlier. This represents one of the lowest vacancy rates nationally, creating intense competition among prospective tenants.
Central suburbs maintain virtually zero vacancy rates, with most premium locations showing less than 0.5% availability. Battery Point, Sandy Bay, and North Hobart rarely have available properties lasting more than days on the market.
Even outer suburbs like Brighton and Glenorchy maintain vacancy rates below 1%, indicating strong demand across all price points. This tight market gives landlords significant negotiating power and reduces tenant options.
The low vacancy environment means properties rent quickly, often with multiple applications, and rental increases face minimal resistance from tenants fearful of losing accommodation.
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Australia versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you're planning to invest there.
What's the breakdown of rental yields for property investors?
Hobart's rental yields remain attractive compared to major Australian capitals, though they vary significantly by property type and location.
| Property Type | Gross Yield Range | Best Performing Suburbs |
|---|---|---|
| Houses | 4.1% - 4.4% | Gagebrook, Chigwell (up to 6.0%) |
| Units/Apartments | 4.5% - 5.6% | New Norfolk, Geilston Bay (up to 6.0%) |
| Premium Properties | 3.8% - 4.2% | Battery Point, Sandy Bay |
| Outer Suburb Houses | 4.8% - 5.2% | Brighton, Bridgewater |
| CBD Apartments | 4.2% - 4.8% | Hobart, North Hobart |
Net yields typically run 1-2% lower than gross yields after accounting for management fees, insurance, rates, and maintenance costs. Investors should budget these expenses carefully when calculating actual returns.
The best-yielding properties often require higher maintenance costs or appeal to specific tenant demographics, affecting overall investment strategy decisions.
How have rents and yields changed over recent years?
Hobart's rental market has experienced significant growth and transformation over the past five years.
Average house rents have increased 8.9% year-on-year as of September 2025, while unit rents climbed 8.5% over the same period. The three-year average annual growth rate sits at 4.3%, indicating sustained upward pressure.
Five-year data shows even more dramatic changes, with average annual rent growth of 5-6% compounding to create substantial increases in housing costs. This growth rate significantly exceeds general inflation, creating affordability challenges.
Rental yields have actually improved slightly as rents outpaced property price growth. House yields increased from approximately 3.8% five years ago to today's 4.1-4.4% range, while unit yields rose from 4.2% to 4.5-4.8%.
This yield improvement reflects a rental market moving faster than property sales prices, creating better conditions for investors willing to accept current purchase prices.
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What's the forecast for rents and yields in the coming years?
Hobart's rental market outlook suggests continued strength with some moderation from current extreme conditions.
One-year forecasts predict modest rent growth of 2-5% through 2026, as extremely low vacancy rates support continued increases but at a slower pace than recent years. Yields should remain stable or improve slightly as rental income growth matches property price movements.
Five-year projections to 2030 anticipate vacancy rates rising to around 2% as increased housing supply comes online, potentially stabilizing rent growth. Yields are expected to remain in the 4-5% range unless property prices surge faster than rental income.
Ten-year forecasts through 2035 suggest rental growth will likely track general inflation at 2-3% annually once the current supply shortage resolves. Yields should stabilize in established ranges unless major economic disruptions occur.
These forecasts assume continued population growth, economic stability, and gradual housing supply increases to meet demand pressures.
How does Hobart compare with other similar-sized Australian cities?
Hobart maintains competitive rental pricing and yields compared to other Australian capitals and regional centers.
Rental costs remain significantly below mainland capitals, with average house rents of $585 per week compared to Perth ($695), Adelaide ($611), and Darwin ($636). This affordability advantage attracts interstate migrants and investors.
Rental yields outperform major capitals like Sydney and Melbourne, with Hobart's 4.1-4.4% house yields and 4.5-4.8% unit yields comparing favorably to Brisbane and Perth's similar ranges.
Vacancy rates at 0.6% rank among Australia's lowest, indicating stronger rental demand relative to supply than most comparable markets. This tight market provides more stable income for investors.
Growth rates in Hobart have exceeded most other capitals recently, though this reflects catching up from previously lower base prices rather than fundamental overvaluation.
It's something we develop in our Australia property pack.
Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.
Hobart's rental market offers attractive opportunities for both investors and residents, with strong yields and growing demand creating a competitive but profitable environment.
While affordability challenges exist, the city remains more accessible than mainland capitals while delivering superior rental returns and market stability for property investors.
Sources
- SQM Research - Hobart Weekly Rents
- Realestate.com.au - Tasmanian Suburbs Analysis
- Domain Rental Report March 2025
- Realestate.com.au - Hobart Rental Price Trends
- Aussie Home Loans - Tasmania Property Forecast
- Rent.com.au Market Snapshot January 2025
- Which Real Estate Agent - Hobart Management Fees
- Canstar - Average Home Loan Australia
- OpenAgent - Hobart Property Market Profile
- Savings.com.au - Tasmania Rental Yields