Darwin Blog

THE LATEST DARWIN PROPERTY MARKET UPDATE FROM GLENN GRANTHAM; JUNE 2021

Check out the latest update on the Darwin real estate market in June 2021, from our GM Glenn Grantham.

Good day, folks. How are you going? Glenn Grantham, General Manager of Raine & Horne in Darwin, coming to you to give you an update on what is going on in the Darwin market right at this moment, especially, obviously, concentrating on residential sales.

30th of June, big date for the purchases within the Darwin market, or for a large amount of those, which are the first-time buyers. The government, in their infinite wisdom, have decided to remove the initiatives and incentives around stamp duty rebate. Some cases, that's up to around about $20,000 that the purchasers are no longer, you know, or now will have to pay in relation to purchasing a new property up to $650,000, represents around about 45% of the market over the last 12 months in Darwin.

So we'll be interested to see what the impact of that is on the Darwin market.

I feel as though it won't, obviously, lock the purchasers out of the market. But what it will do is, in some cases, delay their decision because, obviously, the rental pressures that are happening in our market at the moment as certainly still incentivizing first-time buyers to enter that market, and avoid having to pay rents that, in some cases, have increased up to 20%, 25% from where they were 12 months ago.

Basically, $100 to $150 a week on anything under $500 per week is roughly what renters are currently paying extra.

What that will mean, we've got a lot of good infrastructure projects pushing our market along, as well as some projects, I guess, but in particular, the Santos project exploring the Barossa Basin, where their logistical team are aiming to start to move to Darwin and be on-site in July, and ramping forward with the construction phase around that. Vastly different sort of project to that that we experienced with Ichthys in as much as Santos being a Australian company have looked and said they're going to concentrate on local workers to service what they require in regard to their employment needs.

So that will be very good, hopefully, a bit more population growth. The population growth, I would still estimate, is upward of 5,000 people since the commencement of COVID restrictions back in around about March last year. It could be as high as 10,000 people, and that's certainly what we've seen in the take up of sales around Darwin.

So what I see for the next 6 to 12 months, there's a lot more interest coming into our market. In fact, there is interest coming into our market with investors off of the East Coast. This is, obviously, due to the yields that we're delivering in the marketplace as those rental prices have increased, and in some situations, patchy little parts where there are still properties that have not experienced that growth in median house price. And what that is, is apartments, older properties that need renovation, etc, they're the ones that you can still pick up a bargain, and still pick up great yields in excess of around about 6%.

So that investor interest is there. Obviously, Darwin is offering up something that the rest of Australia is struggling to be able to offer, too, as an investment return. We think that will probably continue to push our market forward. We started from a very low base. We're showing the largest growth across Australia on a percentage-wise in relation to not only volumes but also in relation to median house prices. despite the fact that we haven't got 40 or 50 people turning up at every home open. It is still patchy, however, Darwin certainly has reason to be bullish in regard to their future.

Certainly, the next 6 to 12 months, if I could look into my crystal ball, if it's not cracked, if everything continues to go this way, I would suggest that we're going to see another 6 to 12 months before we actually even get close to hitting the peak in Darwin for median house price. Gives you a pretty good idea of what's going on, hopefully, if I'm right. Anyway, I'll come back to you, and let you know whether I've got it right in about six months' time.

Have a good one. Thanks for listening.

For further media information contact:

Glenn Grantham, General Manager, Raine & Horne Darwin on 0418 803 222