According to data from leading real estate firm Raine & Horne, the number of properties hitting the market for sale in Darwin is about 75% higher than the capital city’s historical January average. 

 Mr Glenn Grantham, General Manager, Raine & Horne, said, “There was a surge of vendors releasing their properties for sale in January, especially after many recognised last year had been very good for capital growth.” In 2021, Darwin’s real estate values increased by almost 15%[i], its highest annual growth rate in many years. 

 Many of the properties for sale are long-term rentals. “Given the transient nature of Darwin’s workforce, plenty of tenancy agreements end at this time of year and rather than seeking to find a new tenant, the owners are deciding to put the properties on the market for sale,” said Mr Grantham.  

 “This decision makes plenty of sense as it is often more straightforward to show a vacant property to buyers than a home with a tenant.”

 Mr Grantham continued, “Also, around 85% of buyers in Darwin are currently owner-occupiers seeking to a first home or to upgrade. If there is a lease in place on a property, first home buyers and upgraders will look elsewhere.”

 To illustrate the strength of the Darwin market, a magnificent five-bedroom house at 14 Britomart Gardens, Alawa[ii], recently renting for $750 a week, is expected to fetch a price in the $800,000s. 

 Mr Grantham said, “This spectacular property which has been tenanted since 2015 and has floated around the $600,000 mark for years will now sell for a much higher price for its owners.  

 “Where else can you find a property of this calibre in any other Australian capital city that is just 10 kilometres to the CBD and five minutes to the nearest beach for well under $1 million.” 

 While it’s expected the showpiece property will be snapped up by a Darwin local owner-occupier, given its price tag and potential yield of around 5%, Mr Grantham said there remains the possibility a yield-hungry southern state investor enters the buying fray.

 “If more local and southern state investors jump into the Darwin real estate market and give owner-occupiers a run for their money on properties such as 14 Britomart Gardens, we will be able to meet some of the demand for rental properties.”

 Owner-occupier dominance will squeeze tight rental markets

 Owner-occupiers buying dominance continues to put the squeeze on Darwin’s already tight pool of rental properties, noted Mr Grantham.

 “We’ve even seen an increase in off-market sales to tenants. Some tenants are buying their rentals homes because they like the property so much,” he said.

“These off-market sales not only take the tenant out of the rental market but also take the long-term investment properties out too.” 

 “The silver lining is that a smaller pool of rental properties combined with strong tenant demand will push up investment yields in Darwin which is great news for investors.”

 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. 

[i] https://www.corelogic.com.au/news/housing-values-end-year-221-higher-pace-gains-continuing-soften-multi-speed-conditions-emerge

[ii] https://www.raineandhorne.com.au/darwin/properties/14-britomart-gardens-alawa-0810-northern-territory