A household buying a typical home in regional Tasmania now needs 1.7 average incomes to service the mortgage. HIA considers a home affordable when it can be serviced on no more than 30 per cent of the annual earnings of a single average income earner.

Regional Tasmania is also the only part of Australia that is less affordable than its own capital city.

"That is the reality that stands out for us," HIA Executive Director Benjamin Price said.

"Everywhere else in the country, moving out of the capital city buys you some relief, but in Tasmania it does not. That has been the case for a while now and this quarter it has reached a record."

The HIA Affordability Index for regional Tasmania fell 6.0 per cent in the June 2026 quarter, the third steepest decline of any market in the country behind only Darwin and regional Western Australia. Over the year it fell 12.9 per cent, to a reading of 58.5.

Hobart also deteriorated, down 5.2 per cent in the quarter and 9.7 per cent over the year to a reading of 72.0.

Median dwelling prices across regional Tasmania rose 3.3 per cent in the quarter to be 15.1 per cent higher over the year. In Hobart prices rose 2.3 per cent in the quarter and 10.9 per cent over the year. Average earnings in Tasmania grew 3.0 per cent over the same year, one of the slowest rates in the country.

Typical monthly mortgage repayments have reached $3,430 in regional Tasmania, up 18.3 per cent over the year, and $4,048 in Hobart, up 14.0 per cent. A first home buyer in Hobart now needs 6.2 years to save a 15 per cent deposit, up from 5.8 years a year earlier.

"Prices here kept rising while Sydney and Melbourne came off, and our wages have grown more slowly than most of the country. Tasmania got the interest rate rises without the price relief, so the gap widened faster here," Mr Price said.

Nationally, the HIA Affordability Index fell 3.1 per cent in the June quarter to its lowest level since the series began in 1994. Affordability went backwards in every market in the country, including those where dwelling prices are now falling.

"That is the part worth paying attention to, with prices coming down in the big markets and affordability still getting worse, because the cost of servicing a loan rose faster than incomes. Knocking confidence out of the market does not deliver a single extra home and it does nothing for what it costs to build a new one," Mr Price said.

"Lower prices and lower costs are not the same thing.

"The way to improve this in Tasmania is to reduce the cost of land and construction. That means the planning system working consistently across every council, serviced land coming to market faster, and the infrastructure that has to go in before a slab can be poured being properly funded. It also means governments and utilities not treating new homes as a place to recover costs.

"Every charge added to a new home is paid for by the Tasmanian buying it."

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