Although Darwin performed slightly better in Perth, there remains a troubled market because affordability is declining
The outlook for Darwin remains bleak at the end of 2019, with prices remaining low and very few prospects for growth in the near future.
Although Perth was named the worst performer on the Australian market in the three months leading up to August 2019, Darwin came very close, recording a 1.7% drop in property values ??compared to 1.8% for Perth. Supplier discounts also increased sharply, from 7.7% in July 2018 to 8.2% after 12 months, highlighting the weakness of the market.
However, the regional pockets of the Top End fared better than the metro, prices having increased in July and August 2019. Victoria and Tasmania were the only two other states to record this positive result.
Regional NT also reported low supplier discounts averaging 3.9% in July 2019; however, this measure can be quite volatile given the low number of sales.
Nevertheless, the slower decline this quarter indicates that things are improving in this market. More and more first-time home buyers have taken out loans, with their numbers increasing by more than 50% in the past 12 months.
Housing affordability declined slightly in the June 2019 quarter, according to the Real Estate Institute of Australia (REIA) Housing Affordability Report. The proportion of income needed to meet loan repayments increased by 0.4 percentage points to 20.6% over this period. The opposite was however true for the affordability of the rental.
"The affordability of rents in the Northern Territory improved during the quarter, with the proportion of income needed to cover the median rent decreasing to 20.2%, a decrease of 0.7 percentage point over the quarter and down 2.4 percentage points from the June 2018 quarter, "said REIA President Adrian Kelly.
Darwin retains the distinction of having the highest rental yields of all capitals. The North American suburb of Araluen also entered the CoreLogic Best Tenants list for September 2019, ranking 78th out of 100 suburbs.
This suburb is mainly populated by couples with children. The median rent is $ 580 per week and generates an average yield of 6.5%. Vacancy rates are healthy at 2.8% on average.
SUBURB TO WATCH
BAKEWELL: High yields at Palmerston
Bakewell is a high-yield suburb, with units offering investors an average return of 7.3%. It also has many amenities, which makes it ideal for families.
The decline seems to be slowing down on this market, with house prices and house prices only falling by 4.7% and 5.2% respectively. Properties in Bakewell have become fairly affordable for its location in downtown Palmerston. The median value of the house is just over $ 400,000 and the median unit is well below $ 250,000.
Although the rental market in Bakewell is not particularly solid, with rents down 6.7% and 5.7% for houses and units, rents for these properties average $ 420 and $ 330 per week, respectively.
Affordability: Median housing and housing prices are respectively less than $ 400,000 and $ 250,000
Location: Bakewell is one of the suburbs of downtown Palmerston – a convenient location for professionals
Main suburbs:
Whyalla
,
sunshine
,
collingwood
,
Westbrook
,
new farm
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