Growth rates are still down in the Darwin market, but sales volumes are on the up
Darwin continues to be a difficult market as 2019 rolls on, with property prices across the state maintaining a negative trend.
CoreLogic data indicate that over the five-year period to January 2019 Darwin reported the greatest decrease in growth rates of all the capital cities, with a drop of 24.4%. Over the last 20 years, Darwin was also one of only two regions that did not record double-digit growth.
Nonetheless, over the 12 months to January 2019, the Top End may have begun to turn things around – if only slightly. Darwin’s annual growth rate went from -9.7% to -3.5%, while the regional pockets reported a rise in their annual growth rate from -1% to 1.1%. CoreLogic suggests this is because the regional markets are in better condition overall than the metropolitan markets. Increasing sales volumes in Greater Darwin and Palmerston through the December 2018 quarter were also indicative of higher demand.
“We have some great figures this quarter, with Palmerston sales volumes increasing by 37% – that’s 111 houses sold over the quarter. Overall, the sales volumes for the Darwin region rose by 14% for the quarter, with a total of 226 house sales,” reported Quentin Kilian, CEO of the Real Estate Institute of NT.
“The good news on the sales volumes continued into the unit market, where, for the first time in quite a while, we have seen a sea of black ink.”
Unit sales going strong
In Greater Darwin, apartments are in a strong position – sales increased by 37% in the December 2018 quarter. Inner Darwin and north coast Darwin also recorded excellent figures as sales rose by 20% and 129%, respectively, to 84 sales and 48 sales. Median prices are also rising in many areas, though others are still on a slippery slope. The median value in Greater Darwin dropped by 0.7% to $350,000, while in inner Darwin it tumbled by 6.6%.
Alice Springs recorded an interesting result – while sales volumes were down by 11.6%, the median price increased by 2.3%.
More first home buyers have been getting in on the market as well, as the number of finance commitments from this segment jumped by 2.5% over November– December 2018. With Darwin being an undersized market, however, this figure could still fluctuate.
SUBURB TO WATCH
RAPID CREEK: Prices fall but houses still expensive
Darwin may be the capital city with arguably the highest yields in the country, but this advantage is not shared by all of its markets. Rapid Creek is situated north of the capital, and its prices have been falling erratically since January 2014. In the year to January 2019, house and unit values slipped by 2.5% and 3.8%, respectively, to medians of $577,732 and $297,399.
With a median value of less than $300,000, Rapid Creek apartments are relatively affordable. Landlords also stand to reap good yields of 5.8%. However, the average yield in the house market is just 3.9%. This, coupled with the still-high price tag, suggests that Rapid Creek houses should be avoided for now.
Location: Rapid Creek is just 11km north of Darwin, so residents are close to the capital’s amenities
Housing market: Both houses and units continued their negative streak in the year to January 2019
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