NT Excerpt from the 2012 November Market report

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Top End values are on the up and so are rental yields, as Darwin leads the way for capital cities in 2012

Darwin led the way for growth and yield in August, according to the latest research from RP Data-Rismark. The August Hedonic Daily Home Value Index Results show Darwin’s overall growth to be 5.2% for the past three months, putting it ahead of the field and at 8.4% for the calendar year so far.

The result was part of a positive outlook across Australia, with seven of the eight capitals experiencing growth over the quarter. Adelaide was the only capital to miss out, recording a 2.2% drop since June, but August saw a slight rebound, with growth of 1.4%.

The surge in Darwin values saw the city record a median dwelling value of $497,000, second only to Sydney’s median of $530,000.

RP Data’s research director Tim Lawless believes values were helped upwards by improved affordability.

“The big question is ‘can this growth be sustained?’” Lawless says. “On the one hand, winter is seasonally slow, so these results have been encouraging. On the other, we know there is likely to be an increase in new supply over spring, which may introduce some head winds for a recovering market. How the market plays out over the spring season will be an important litmus test for its resilience.”

Darwin also posted the highest rental yields for both house and unit markets over the quarter, being the only city to record more than 5% for both. The yield of 5.8% for houses beat Hobart’s 5.2% to the top spot, while the 5.7% figure for units edged out Canberra and Brisbane, with 5.6% and 5.5% respectively.

Hope springs for Alice buyers

Renters in the Alice Springs area are spending more money than if they bought a property, according to RP Data’s recent Buy vs. Rent report.

Out of 238 suburbs Australia-wide, where medians show it to be cheaper to buy a property than to rent, the Northern Territory was represented by just six postcodes, all concentrated in the Central Australia region. The suburb of Alice Springs led the way in savings, with a median value unit of just under $300,000 commanding a rental yield of around 7.4% when matched to the median weekly rent. These favourable numbers add up to a saving of $206 per month for owners, compared to their tenants.

Sought-after northern suburb Braitling was the next best, with a saving of $155 per month. The upmarket suburb, on the banks of the Charles River, saw quality units fetching a median rent of $495, for a median value of $362,863. This is a rental yield of approximately 7.1%.

Just one house market made the list; the suburb of Sadadeen, which hosts Charles Darwin University. There, owners were found to be around $107 better off than renters each month.

The report did not take into account property management costs.

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