The numbers tumbling out of Darwin are extraordinary: Terry Ryder

The numbers tumbling out of Darwin are extraordinary: Terry Ryder
Terry RyderDecember 7, 2020

In one of my current seminar presentations, I throw up a slide of data about Darwin with the comment: “Here’s what a boom market looks like.”  

The numbers tumbling out of Darwin and the Northern Territory are extraordinary.

The Territory ranks No.1 in Australia on a number of key economic and property indicators. It has the lowest unemployment rate (3.9%, against the national average of 5.4%) and employment growth is running at almost three times the national average.

State Final Demand has risen 27%, six times the national average.

The Territory ranks No.1 on three key real estate indicators: growth in loans to home buyers, the increase in investor loans and growth in building approvals.

Housing finance commitments by owner-occupiers are up 18% in annual terms (five times the average) while loans to investors have risen 30% (four times the average). At a time when building approvals nationally have increased just 1.4%, in the Territory they’re up 46%.

Darwin continues to have the highest residential rents among the state and territory capital cities (the typical house is $650 per week and apartments average $550) and rental growth in 2012 was exceptional – the house median rent up 16% and the apartment median rising almost 20%. Perth is the only challenger to those growth rates.

Often different research sources provide conflicting numbers about price growth, but everyone seems to agree that Darwin house prices, on average, had double-digit growth in 2012. The Australian Bureau of Statistics, Australian Property Monitors and RP Data all say about 10%, while the Real Estate Institute of Australia reports 12%.

With all four sources, Darwin had the biggest price growth last year among the capital cities, by a considerable margin.

According to the REIA, Darwin has the second highest median house price ($578,000) among the cities, after Sydney.

The thing about Darwin is that its current upward cycle is just beginning. The prime catalyst is the $34 billion Ichthys gas project, but there are plenty of other big infrastructure projects to carry the Territory economy forward.

There are numerous mining projects, a marine supply base, a prison, an abattoir, the possibility of expansion of ConocoPhillips’ gas facilities and the ongoing expansion of the US military presence in Darwin.

Any of Australia’s capitals would experience an uplift with that level of economic activity, but Darwin in a city of just 120,000. In 2013, as in 2012, it is likely to be the national leader on real estate performance.

Terry Ryder is the founder of hotspotting.com.au

Terry Ryder

Terry Ryder is the founder of hotspotting.com.au.

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