Published on October 9th, 2012
Darwin property market will stabilise
Darwin is currently seeing a cycle of a low level of real estate stock and high prices for that stock, according to a property expert.
Chris Deutrom, the general manager of Elders Real Estate in Darwin,says that the housing industry in the top end city will return to normal over time.
"The shortage of stock is a temporary phenomenon; people are reluctant to sell and would rather rent but that's not permanent. With government incentives for purchasing new properties, it's only a matter of time before renters become buyers and the high rental rates will subside," he said.
There is a theory that incentives for new homes only will be detrimental to an attempt to bolster the number of home buyers as those who can't afford a new home, but could afford an older house, will decide to not bother purchasing. Chris has rebuked that theory, saying that new home buyers will take up these government incentives and those grants will improve the property sector and the building industry.
Darwin has seen the highest growth in median house prices than any other capital city in the country, and these will come to a peak and trough out soon enough. Prices will eventually get to a point where people will choose to sell their property and take advantage of the higher prices and a surge of listings will enter the market. Subsequently the prices will drop because of the amount of choice.
Chris describes it as a three to five-year cycle, which by that time will hopefully see a healthy rise in population and a balanced amount of properties available. Currently Darwin is a seller's market and as time goes by that will inevitably change as the market always does.