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Yes, the analysis of Tasmania's property market is included in our pack
Tasmania's rental market offers attractive yields with low vacancy rates and strong demand. As of September 2025, the Tasmanian property market delivers gross rental yields ranging from 4.1% to 9.9% depending on location and property type, significantly outperforming mainland capital cities in many areas.
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Tasmania's rental yields range from 4.1% for houses in Hobart to 9.9% in regional mining towns, with apartments consistently outperforming houses across all regions.
The state maintains Australia's lowest vacancy rates at 0.6% in Hobart, creating exceptional rental stability for property investors seeking steady income streams.
| Location | Property Type | Gross Yield | Median Price | Vacancy Rate |
|---|---|---|---|---|
| Hobart | Houses | 4.1% | $695,000 | 0.6% |
| Hobart | Apartments | 4.7% | $535,000 | 0.6% |
| Regional Tasmania | Houses | 4.4% | $535,000 | 1.27% |
| Regional Tasmania | Apartments | 4.8% | $420,000 | 1.27% |
| Rosebery | Houses | 9.9% | $180,000 | Low |
| Queenstown | Houses | 8.2-8.9% | $175,000-$187,500 | Low |
| Hadspen | Apartments | 6.1% | $490,000 | Moderate |
What's the current average rental yield in Tasmania right now?
Tasmania's rental yields as of September 2025 vary significantly between Hobart and regional areas.
In Hobart, houses deliver an average gross rental yield of 4.1%, while apartments perform better at 4.7%. The overall Hobart market shows yields between 4.2% and 4.4% for the city center, with units reaching up to 4.8%.
Regional Tasmania presents more attractive yields with houses averaging 4.4% and apartments reaching 4.8%. The regional markets consistently outperform Hobart due to lower property prices relative to achievable rents.
These yields position Tasmania favorably compared to mainland capital cities like Sydney and Melbourne, which typically deliver yields between 2.5% and 3.5%. The state's rental market benefits from extremely low vacancy rates and strong rental demand across all property types.
How does the rental yield break down between different property types like apartments, houses, and townhouses?
Apartments consistently deliver the highest yields across Tasmania, followed by townhouses, with houses typically providing the lowest returns relative to purchase price.
| Property Type | Hobart Yield | Regional Tasmania Yield | Key Factor |
|---|---|---|---|
| Apartments/Units | 4.7% | 4.8% | Lower purchase price, steady rent |
| Townhouses | ~4.5% | ~4.5% | Mid-range pricing and rent |
| Houses | 4.1% | 4.4% | Higher purchase price impacts yield |
The yield differential stems from the relationship between purchase price and achievable rent. Smaller, lower-cost properties like apartments generate relatively higher rent compared to their value, while larger detached houses command higher absolute rents but at a lower percentage of their purchase price.
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Which areas in Tasmania give the highest and lowest rental yields?
Tasmania's highest rental yields are concentrated in regional mining and industrial towns where property prices remain low relative to rental income.
The top-performing areas for rental yields include Rosebery with exceptional 9.9% yields on $180,000 properties generating $250 weekly rent. Zeehan delivers 8-8.9% yields with properties around $195,000-$200,000 achieving $300 weekly rent. Queenstown offers 8.2-8.9% yields with properties priced between $175,000-$187,500 generating $295-$300 weekly rent.
For apartments, Hadspen leads with 6.1% yields on $490,000 properties renting for $350 weekly. Bridgewater, Upper Burnie, and Newnham deliver 5.7-6% yields with properties between $300,000-$400,000 achieving $325-$400 weekly rent.
The lowest yields are found in Hobart's inner suburbs and premium coastal areas, where high property values typically deliver yields between 3.5%-4.2%. These areas attract higher rents but the ratio rarely exceeds 4.5% due to elevated purchase prices.
What are the typical purchase prices for these properties, including fees, taxes, and all acquisition costs?
Property acquisition costs in Tasmania vary significantly between Hobart and regional markets, with stamp duty representing the largest additional expense.
| Cost Component | Hobart Houses | Hobart Apartments | Regional Properties |
|---|---|---|---|
| Median Purchase Price | $695,000 | $535,000 | $535,000 (houses), $420,000 (units) |
| Stamp Duty | $27,800+ (over $725k) | $18,000-$23,000 | $18,000-$23,000 |
| Legal/Conveyancing | $1,200-$2,200 | $1,200-$2,200 | $1,200-$2,200 |
| Management Setup | $400-$1,000+ | $400-$1,000+ | $400-$1,000+ |
| Ongoing Management | 5-10% of rent | 5-10% of rent | 5-10% of rent |
Regional high-yield properties like those in Rosebery cost $180,000-$200,000 with stamp duty between $5,935-$8,000. Stamp duty scales at $4.25 per $100 for properties above $375,000, with significant first home buyer exemptions available.
Total acquisition costs typically add 4-6% to the purchase price for properties under $500,000, and 5-7% for premium properties over $700,000.
How do surface size and property features influence the yield?
Rental yields generally decrease as property size and luxury features increase, particularly in Hobart and coastal areas.
Smaller apartments and houses are more likely to deliver higher rental returns relative to cost, while premium homes with large floor areas and high-end features yield less as a proportion of value. This relationship exists because larger properties command higher absolute purchase prices that typically grow faster than proportional rent increases.
Properties with valuable, in-demand features like garages, outdoor space, modern kitchens, and included utilities can achieve slightly higher rents. However, these features typically do not offset the higher purchase prices in yield calculations, making them better suited for capital growth rather than yield-focused strategies.
The most yield-efficient properties are typically 2-3 bedroom apartments or modest houses with essential amenities rather than luxury features. Regional properties benefit from practical features that appeal to working tenants rather than premium finishes.
What's the breakdown of rental income and net yield once you include mortgage payments, ongoing costs, and property management fees?
Net rental yields in Tasmania typically range from 2.0% to 7.5% after accounting for all expenses, significantly lower than gross yields.
Operating expenses include mortgage interest (approximately $37,000 annually for a $500,000 loan at current rates), property taxes, council rates, insurance, maintenance, property management fees (5-10% of rent), water/utilities, and letting costs. Total annual expenses typically range from $11,000-$15,000 for a standard property.
For a typical Hobart 3-bedroom house with 4.1% gross yield generating $28,600 annual rent ($550 weekly), net rental yield drops to 2.0-2.8% after expenses. Apartments and units tend to have lower maintenance costs, achieving net yields of 2.2-3.1%.
Regional high-yield properties perform better on a net basis. A Rosebery house with 9.9% gross yield generating $13,000-$15,600 annual rent achieves net yields of 5-7.5% due to lower ongoing costs and reduced mortgage requirements.
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What's the profile of typical renters in different Tasmanian areas, and how stable is the demand?
Tasmania's rental demand remains exceptionally stable across different market segments, driven by diverse tenant profiles and ongoing housing undersupply.
Hobart and Launceston attract professional tenants including singles and couples seeking apartments, families requiring houses or townhouses, and a growing share of retirees downsizing from larger properties. The main cities experience strong stable demand with occasional seasonal influx for short-term and holiday rentals.
Regional high-yield towns like Rosebery, Zeehan, and Queenstown primarily attract young workers, lower-income tenants, and those employed in hourly jobs related to mining and industrial operations. These areas maintain consistent demand due to employment opportunities in specialized industries.
Tourist-focused areas experience mixed demand with professionals, retirees, and seasonal workers, creating opportunities for both long-term and short-term rental strategies. The rental market benefits from Tasmania's growing population and limited housing supply, ensuring sustained demand across all tenant categories.
What are the current vacancy rates across regions and property types?
Tasmania maintains some of Australia's lowest vacancy rates, indicating extreme rental competition and structural undersupply across the state.
| Location | Vacancy Rate (Sept 2025) | National Average | Market Condition |
|---|---|---|---|
| Hobart | 0.6% | 1.2% | Extremely tight |
| Launceston | ~1.1% | 1.2% | Very tight |
| Regional Tasmania | 1.27% | 1.2% | Tight |
| Australia Overall | - | 1.2% | Balanced |
Hobart's 0.6% vacancy rate represents one of the tightest rental markets in Australia, creating predictably low rental risk for property owners. Rates have dropped sharply in key city and regional markets over the past 12 months, with only marginal improvement in parts of northwest Tasmania.
These exceptionally low vacancy rates translate to strong rental security for investors and minimal void periods between tenancies. The tight market conditions support rental growth and provide landlords with significant tenant selection opportunities.
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How do short-term rentals compare with long-term rentals in terms of yield and stability?
Short-term rentals in Tasmania often deliver higher gross yields but come with increased volatility and management complexity compared to long-term rentals.
Short-term rentals like Airbnb properties typically achieve yields between 6-9%, especially in high-tourism regions around Hobart, Launceston, and popular destinations. However, these yields are subject to seasonal variation and occupancy risk, with income fluctuating based on tourism patterns and economic conditions.
Long-term rentals provide less volatile income with reliable returns typically ranging from 4-5% gross yield. These arrangements offer higher stability, lower management requirements, and operate under established rental legislation with clear tenant protection frameworks.
The short-term rental market growth is impacting long-term rental supply, particularly near major cities, which has contributed to the extremely tight rental market conditions. Investors must consider increased management costs, seasonal variations, regulatory risks, and higher vacancy potential when evaluating short-term rental strategies versus the stability of long-term tenancies.
Can you give some example rental returns for different types of properties, like a 2-bed apartment or a 3-bed house?
Specific rental return examples demonstrate the practical performance differences between property types and locations across Tasmania.
A 2-bedroom apartment in Hobart with a median purchase price of $535,000 achieves $480 weekly rent, generating $24,960 annual income for a 4.7% gross yield. After expenses including mortgage interest, rates, insurance, and management fees, the net yield typically ranges from 2.9-3.2%.
A 3-bedroom house in regional Tasmania, specifically in Rosebery, purchased for $180,000-$200,000 achieves $250-$300 weekly rent. This generates $13,000-$15,600 annual income for exceptional gross yields between 8-9.9%. Net yields remain strong at 5-7.5% due to lower ongoing costs and reduced mortgage requirements.
A typical 3-bedroom house in Hobart costing $695,000 achieves approximately $550 weekly rent ($28,600 annually) for a 4.1% gross yield. After all expenses, net yields drop to 2.0-2.8%, making regional properties more attractive for yield-focused investors.
It's something we develop in our Australia property pack.
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.
How have rents and yields changed over the last 5 years, and how do they compare with just 1 year ago?
Tasmania's rental market has experienced significant growth over the past five years, with particularly strong increases during the post-pandemic period.
Rents have climbed steadily, especially after 2020, with regional Tasmania recording 4.7% growth in 2024-2025 and Hobart showing 1.8% year-on-year increases. The longer-term trend shows sharp rent growth from 2021-2023, which has slightly slowed in the past year as affordability challenges have emerged.
Gross yields have increased marginally overall during this period, remaining steady at 4-4.5% for houses and nearly 5% for units. The yield performance reflects property values rising less rapidly than rents during the 2021-2023 period, though this relationship is now flattening due to affordability ceilings.
Compared to one year ago, yield volatility has decreased after surging during 2021-2023. The current market shows more stable yield patterns as both rents and property values find new equilibrium levels, with yields remaining resilient due to persistent undersupply and consistent demand.
What are the smartest choices for investors today, what's the forecast for yields in 1 year, 5 years, and 10 years, and how does Tasmania compare with other similar-sized cities?
The smartest investment choices for yield-focused investors in Tasmania center on regional properties and well-located apartments in established areas.
1. High-yield regional towns like Queenstown, Zeehan, and Rosebery offer exceptional returns due to lower property prices and higher rent multiples relative to capital city markets.2. Well-located units or apartments in Hobart or regional centers provide strong yields with lower maintenance costs and consistent tenant demand.3. Short-term rentals in tourist hotspots with strong occupancy rates can deliver premium yields for hands-on investors comfortable with higher management requirements.4. Properties under $400,000 in regional centers offer the best yield-to-effort ratio for passive investors seeking steady income streams.5. Apartment investments in emerging areas near Hobart provide balance between yield and potential capital growth opportunities.Yield forecasts show experts anticipating gross yields to remain stable in the 4-5% range for Hobart and 4.5-9% in selected regional towns through 2026. Longer-term forecasts suggest yields will remain resilient through 2030, driven by persistent undersupply and tourism demand, though growth may be slower due to population stagnation and affordability limits.
Compared to similar-sized cities, Tasmania's rental yields outperform Sydney, Melbourne, Brisbane, Adelaide, and Canberra while competing closely with Darwin and Perth. Hobart's lower vacancy rates than almost anywhere else in Australia provide predictably low rental risk, though the smaller population limits scale compared to major mainland markets.
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.
Tasmania's rental market presents compelling opportunities for yield-focused investors, particularly in regional areas and apartment segments.
With Australia's lowest vacancy rates and stable demand patterns, the state offers exceptional rental security despite moderate yield levels in premium locations.
Sources
- Savings.com.au - Tasmania Rental Yield
- Which Real Estate Agent - Hobart Property Market
- RealEstate.com.au - Hobart Rental Prices
- Property Director - Tasmania Investment
- Your Mortgage - Highest Rental Yields
- OpenAgent - Rental Yield Suburbs
- Stamp Duty Calculator Tasmania
- CoreLogic Rental Review
- Domain Rental Report
- OpenAgent Hobart Market Profile