Darwin market affordable but stable

The Herron Todd White Month in Review for July looked at how markets throughout Australia had performed in the past six months.

HTW director, Shaun Thomas, said interest rates were the main driver in most markets with the cuts economists predicted at the start of 2024 not eventuating due to stubborn inflation numbers.

He said economists were now forecasting the cut wouldn’t come until 2025.

“There’s even a chance of a cash rate increase in the next few months,” Mr Thomas said.

“This has resulted in the major capital markets in Sydney and Melbourne, along with the smaller capital markets in Hobart, Darwin and Canberra, starting to flat line, and in some cases decline, as buyers and sellers enter the winter season in somewhat of a holding pattern.”

The home at 2 Notley Pl, Parap NT, sold for $2m in April. Picture: Supplied

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Darwin-based HTW valuer, Cameron McDonnell, said throughout the first half of 2024, the Darwin dwelling market remained stable across most segments with the best performing sub-market being the rural residential market in suburbs such as Howard Springs, Humpty Doo and Virginia.

“While the rest of Australia saw strong capital value growth throughout 2022, 2023 and the first half of 2024, Darwin has not,” he said.

“Unsurprisingly this makes Darwin very affordable.

“The median value in Darwin’s inner suburbs is sitting at $745,000, the northern suburbs at $667,500 and Palmerston at $510,000.

“There are not many markets left in Australia where the median values are still well below $1 million and it is for that reason there is a coy expectation that we may see some capital growth in values in the months ahead.”

Mr McDonnell said inner Darwin has seen good activity, particularly within the premium and prestige segment of the market, with a $2m sale in Parap setting a new suburb record and a Larrakeyah home settling for $5.325m.

“Agents are reporting premium stock is still being met by the market with typical levels of interest,” he said.

“The sought after suburbs of Larrakeyah, Fannie Bay, Parap, Stuart Park and Bayview have been less volatile than mortgage belt locations with quality properties in these locations often sheltered from the impact of interest rate rises and demand remaining strong.”

Mr McDonnell said well renovated and modern homes continued to achieve premiums and move quickly.

“Given rising construction costs and a lack of available trades, dwellings that require upgrades or full renovations have been less sought after,” he said.

The sprawling home at 19 Kirkland Cres, Larrakeyah, sold for $5.325m. Picture: Supplied

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Mr McDonnell said this was evident in the $700,000+ market in the northern suburbs and in the $450,000 – $600,000 market in Palmerston.

The local market expert said strong interest remained for quality homes in the rural area.

“There has been a string of strong sales in almost all inner and outer rural suburbs with buyers willing to spend the money on well-established modern homes offering extra space, amenity and quiet,” he said.

“Strong sales are across the board with multiple settled sales above $1.2m in Humpty Doo, Howard Springs, Girraween, a recent sale in Virginia exceeding $1.9m and then a little further out, $1.2m was paid for a property in Acacia Hills and $1.55m for a beautiful home in Berry Springs.

“Speaking with the relevant agents, the purchasers are mostly local to the Northern Territory and are looking to move away from the inner suburbs of Darwin.”

Mr McDonnell said the Darwin property market was heavily dependent on the wider economy with industries such as mining, tourism, defence and the public service playing a vital role in bring more people to the Territory.

“There is a Territory election towards the end of August, with many Territorians waiting with bated breath to see the outcome,” he said.

“The opposition (Country Liberal Party) has led the way by offering building grants and stamp duty exemptions for new builds and first home buyers if they are successful.

“Such offerings are always well received by different participants in the market and may help with getting more new homes built,” Mr McDonnell said.