Darwin Blog

Media release

Lowballing interstate buyers twig that Darwin property is not Sydney and Melbourne

Key points
• Lowball offers for Darwin property have dried up since the start of the new financial year.
• Interstate investors now recognise that the Darwin market is in a growth phase.
• Rental properties are re-leasing for as much as 10 -15% higher, which has pushed yields up to 8% for some Darwin properties.

Darwin NT (27 July 2022)

With east coast property markets taking a breather, cashed-up southern state investors have discovered real estate values in Darwin haven’t followed suit, according to Glenn Grantham, General Manager of Raine & Horne Darwin.

“Investors from down south eagerly eyed Darwin real estate as a discount haven back in June as real estate values in other capital city markets started to plateau as a succession of interest rate hikes kicked in.” Mr Grantham continued, “Towards the end of the financial year we were getting ridiculous offers on Darwin properties simply because southern investors thought the commentary about the markets in Sydney and Melbourne meant Darwin values were plummeting.

“The unrealistic offers also coincided with higher interest rates, but the Darwin market is still in a
growth cycle.” Darwin real estate values increased by 2.3% in Q4 2022, while Sydney values fell by
2.8%.

In late June 2022, a four-bedroom family home at 74 Rosewood Crescent, in Leanyer, a northern suburb of Darwin attracted several lowball offers from four southern investors in the $500,000s. “A local owner-occupier has since secured the property for a price in the upper $600,000s because he recognised this was a fair price for a quality, well-located family home in the popular northern suburbs,” Mr Grantham said.

“Other properties have similarly received realistic price offers from local owner occupiers and interstate investors who ignored the outside noise. These buyers recognised that Darwin offers excellent affordability plus in some cases yields as much as 8%.

“Not surprisingly, with properties such as 74 Rosewood Crescent selling for realistic prices, the
lowballing offers have dried up and most buyers are recognising that Darwin is running contrary to
other capital city markets with the exception of Perth.”

Zero vacancy rates and low unemployment drive rental markets on the leasing front, with vacancy rates in Darwin close to zero, Mr Grantham said that every rental property is re-leasing for as much as 10-15% higher than the previous tenancy term.

“Higher rents have pushed average yields up from 6% to 8% and this is also catching the eye of savvy investors, which is contributing to stronger sales results for vendors,” he said. “With more interstate workers moving here our unemployment rate is close to 2% and these extra workers are driving demand for rentals.”

For all your real estate sales and property management needs in Darwin, and Palmerston or to find out about the auction process, contact Raine & Horne Darwin on 08 8941 8941.

–ENDS–

For further media information contact:
Glenn Grantham, General Manager, Raine & Horne Darwin on 0418 803 222
Olivia Rowe, Content & Communications Executive, Raine & Horne Group on 0432 113 569

i https://www.corelogic.com.au/__data/assets/pdf_file/0007/11500/CoreLogic-home-value-indexJuly-2022-FINAL.pdf
ii https://www.raineandhorne.com.au/darwin/properties/74-rosewood-crescent-leanyer-0812-northern-territory-b8c82515-7405-4582-b4b7-ac8ab8fd30f0