NT Excerpt from the 2012 July Market report

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Property prices pushed upwards during the first quarter of 2012, but where to from here?

The upwards price momentum of Darwin property is continuing to gather speed, according to separate reports released by the Australian Bureau of Statistics (ABS), Residex and RP Data.

The ABS figures showed Darwin’s established house prices grew by 4.4% in the March quarter, making it by far the strongest capital city. The next best were Canberra (1.2%) and Perth (1.1%).

Residex also recorded a 2.35% growth in median house price in Darwin during the three months ending April, which was trumped by an even stronger showing in the unit market. Median unit price surged almost 6% during the same period.

Meanwhile, RP Data’s figures suggested that house prices rose 4.9% over the three months to March, compensating for the slower growth of 0.9% for units. However, Cameron Kusher, senior analyst for RP Data, said the research group was not expecting much further growth for the remainder of 2012, due to affordability.

Kusher also said that the much feted Inpex gas project included a worker’s village at Howard Springs, and was therefore unlikely to increase demand for new property in Darwin. RP Data’s figures also showed that Darwin house rental yields of 5.8% beat the other capitals, while units (5.7%) fell just short of top ranking Canberra (5.8%).

Hotspots defy population trends

Five Northern Territory areas, four of which were in Darwin, have been included on the Housing Industry Association’s list of hotspots for the 2010/11 financial year, released in mid- April. A hotspot for the NT is defined as a local area where the rate of population growth exceeds the national rate (1.4%) and the value of residential building work approved is in excess of $20m.

Areas from the top end to make the national snapshot included the Lee Point-Leanyer Swamp, Darwin City, Parap and Litchfield.

HIA NT executive director Robert Harding was happy with the result, which defied the territory’s last place for population growth during the year.

“Despite the poor population growth for the Territory as a whole, it is pleasing to see some areas register as Building and Population Hotspots during 2010/11.

“Population growth will turn around.”

Office space

The trickle-down effect of the Inpex gas project will arrive just in time to combat a rising office vacancy rate in Darwin, according to the latest Property Confidence Survey, released by the Property Council of Australia.

In the six months to January 2012, nearly 4,000m2 of new office space entered the Darwin CBD market, causing vacancy rates to soar from 7.9% to 9.1%, according to Property Council figures.

Northern Territory Property Council president Brendan Dunn warned that while new projects would improve the situation, investors needed more to work with than just the knowledge that such ventures were underway.

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