Darwin property market stabilising, despite considerable sales drop: Herron Todd White

Stephen TaylorAugust 5, 20130 min read

After a busy 12 months the Darwin property market has stabilised over the last quarter with median house and unit prices holding steady and the number of sales dropping considerably, according to valuers Herron Todd White.  

‘’According to REINT’s latest quarterly statistics, inner Darwin median house prices increased 5.4% over the year, however the last quarter saw no increase with the current median selling price sitting at $875,000.  

‘’In the northern suburbs, Sanderson showed 4.1% growth in the past 12 months and this last quarter saw a 1.1% increase, now at $572,500. Palmerston, which has gone up 12.7% for the 12 months to March 30, had a 2.8% increase over the first quarter with a median  house price of $550,000.’’  

Herron Todd White says the overall Darwin median two-bedroom unit price is at $425,000. This is a 2.4% increase over the past 12 months, but over the last quarter it has decreased 1.2%.  

So, while there have generally been small increases in the median price, the big change is in the sales volumes.  

The inner Darwin sales volume is 19.2%  down on the previous year - while the northern suburbs (Sanderson) recorded a 20.7% drop in sales.  

Cheaper house prices and development projects in Palmerston meant there is less of a drop at 12.3%.  

With more and more people coming to the Top End rents are still strong, the valuer says. Rent was generally up across the board in the Darwin region with three-bedroom house rentals showing a 1.9% increase in the last quarter and a 16.3% annual rise.  

‘’Anyone who bought in the past two years would now be sitting back happily with some strong capital gains. Those who bought in late 2009 and early 2010 will be breathing a sigh of relief now that the market has corrected itself after the drop in 2011.  

‘’But the gains that we have seen over the past year or so were unlikely to keep on at such a high rate because of unsustainable growth and affordability issues,’’ the valuers say.  

While things have quietened down slightly, the Darwin market is still sturdy. Indicators such as low vacancy rates and a shortage of housing mean that, while prices may have stabilised and might not increase much in the short term, investors with a long-term view will still do well.  

‘’Unit developments in the area will release more than 500 units into the market over the next 12 to 18 months which could lead to oversupply and lower rental yields,’’ Herron Todd White forecasts.  

‘’However, there are still good returns in the housing market with rents ready to rise over the short term, with infrastructure projects, such as INPEX, increasing demand.’’  

Stephen Taylor

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