Darwin Blog

WHERE IT’S CHEAPER TO BUY THAN RENT IN DARWIN

Courtney Snowden
NT News | April 28, 2023

Exclusive analysis has found the Territory suburbs where you can save money paying off your own mortgage instead of a landlord’s. Check if your dream suburb made the cut.

^{This property at 120 Priest Circuit, Gray, is for sale for $229,000, which would make repayments cheaper than the median suburb rent.}

An exclusive analysis of the Darwin property market has found there are 10 suburbs where it is cheaper to pay off your own mortgage instead of a landlord’s and twice as many suburbs if you are buying a unit.

As rents continued to rise in the Top End, Finder’s analysis of PropTrack data determined whether it was cheaper to buy or rent in each Darwin suburb.

Gray came out on top with the highest rent to mortgage ratio for both houses and units at 13 per cent and 45 per cent respectively, which was a difference of $264 a month for houses and $568 for units.

The biggest savings were found in the unit market where the rent to mortgage ratio was 44 per cent in Karama (a saving of $572 a month), 31 per cent in Larrakeyah ($589) and 30 per cent in Driver ($452).

In the house market, the best ratios after Gray were in Moulden, (12 per cent or a saving of $239 a month), Woodroffe (10 per cent or $220) and Alawa (9 per cent or $218).

Raine and Horne Darwin general manager Glenn Grantham said the Darwin property market was in a “sweet spot” where sale prices trailed rental increases.

“This isn’t uncommon at this juncture of the market where you’ve got an over demand for rental properties and a balanced buyer-seller market in sales,” he said.

“The reason we are seeing a balanced buyer-seller market is that we’re on a pause on our boom market that has been caused by recent interest rate increase.

“It will continue right up until the boom cycle for the Darwin market reinstates itself and if (the latest) news on inflation is anything to go by, that’s probably not too far away.”

^{Glenn Grantham said the Darwin property was in a “sweet spot” where buyers could spend less on mortgage repayments than rent. Picture: Keri Megelus}

Mr Grantham said he had noted an upwards trend of tenants buying since the start of the year.

“We have successfully facilitated a number of tenants keen to purchase the property they have been renting,” he said.

One such tenant was Elena Lee who six weeks ago bought the property she was renting in Rosebery, where PropTrack data showed buyers would be on average just $25 out of pocket a month for buying instead of renting.

“My lease was due for renewal and my rent was going up by $50 per week, which was a fair hike,” Ms Lee said.

“Rather than continuing renting I’d began investigating the idea of buying.”

^{The house at 10 Sirius Street, Woodroffe, is for sale for $500,000, which would make mortgage repayments about the same as the median suburb rent.}

When Ms Lee told her real estate she wanted to buy a home they said the owner of the property she was leasing was willing to sell.

“When the opportunity came up, it was perfect for me,” she said.

Ms Lee said it was a relief knowing she would no longer had to deal with rent increases.

“I do know a couple of people buying instead of renting for the same reason, because the rentals are going up quite dramatically,” she said.

PropTrack data showed the median rent in Darwin increased 5.66 per cent in the 12 months to March to $560 a week.

In the same time the median sale price was up 1.7 per cent for houses, to $585,000, and 0.7 per cent for units, to $382,750.

The Finder analysis, based on median prices and rents and an 80 per cent loan to value ratio, found there were 15 suburbs across the Northern Territory where houses were cheaper to buy than rent and 25 suburbs where units were cheaper.

To find out more about the selling, purchasing, or auction processes in Darwin and surrounds, give the team at Raine & Horne Darwin a call today on 08 8941 8941.