Hi Mark,

We’re from Darwin and interested in residential investment property. Quite happy to share our knowledge.

Ciao
kitdoctor

Hi to all,

I’ve lived in Darwin since 1989 and talk to a lot of people about their views on property and there are some different opinions about Darwin’s prospects. Some observations:

1. Quality houses particularly waterfront houses like that at Cullen Bay, Bayview Haven have gone crazy from what I’ve heard. Some remaining waterfront blocks at Cullen Bay were advertised last weekend in the NT News from $690 000 to $750 000. My neighbour (who is a prominent builder) told me he paid less than a third of this for a waterfront block in 2000. Another friend who is an accountant owns a house in Bayview which was revalued recently, $200 000 more than what they built it for 12 months ago.

2. I noticed in my local suburban paper in the section where they summarise house sales a couple of actual house sales in Fannie Bay for in excess of $1.0M. It was only this year that the NT News carried a piece speculating the first ever sale above $1.0M posssibly a house in Cullen Bay. So its happened. It seemed to go unnoticed by the major paper!!!!!

3. I went to an auction today for a pre cyclone 5 bedroom house on a huge ‘double house’ R1 zoned 1720 square metre block located in Rapid Creek. It had a new roof, repainted inside, renovated kitchen, very nice garden. Started at $260 000 (down from $300 000) with very slow bidding. Four bidders in the race and the crowd thought it was going to be passed in. Someone asked if it was on the market and was told ‘I’ll tell you in a moment’, bidding continued. Goes to $331 000, then suddenly 1-2-3 it’s sold. No mention it’s on the market, no obvious consultation with the vendor. I thought given the land size the buyer did well.

4. Housing commission renovators in Darwin (and Palmerston) have certainly increased. Houses selling in Darwin for $110 000 earlier this year, now upwards of $170 000 to $190 000, even higher. Next big auction is 6 December.

5. Still plenty of apartments (i.e. multi high rise apartments) on the market and for rent. Unfortunately these hurt the prices of quality townhouse, duplex, detached units etc.

6. The $600M Waterfront development is being fast tracked by the government as they are acutely sensitive about their political position. They are putting in $100M and looking to the private sector for $500M. They are compressing the normal 2 yr phase of doing this into 4 months.

7.Lots of high yielding older apartments in Nightcliff are selling really quickly.

8. Others are correct. Expect a higher tennant turnover. That’s just the way it is.

9. Harsh climate can increase maintenance costs as buildings etc. deteriorate. Gardens can go feral in a matter of weeks.

10. New Army attack helicoptors are to based here.

Plenty more I can add if anyone’s interested. I’m seeing a lot of money being pumped into a town of 100 000 odd. Any other locals out there?

kitdoctor

[]Hi Synergy,

We have some older friends that retired about eighteen months ago and moved here from Karratha. He was a train controller and has gone back a couple of times for short contract stints paying good $$$$. They lived there for a very long time and had IP (not in Karratha).

The other day we quizzed them about Karratha. I mentioned I saw an investor profile in the API magazine about a couple that leased a $330 000 house to BHP for in excess of $3000/month on loan payments of about say $1200. I can’t recall if the house was in Karratha, or another mining town in the north of WA.

Anyway they said there had been a lot of real estate sold recently to interstate investors and there are still a lot of houses for sale, far more than you would find in a similar size jurisdiction in a capital city. Their experience was that prior to the recent interest fuelled by interstate investors houses could sit on the market unsold for years.

Their advice was that you need to consider the scenario when/if you have to sell as the market can be pretty limited. Then again if the place is cashflow positive I think okay. The other warning they gave was to make sure you understand the potential risk of say the mine closing down etc etc. and to do your homework to establish just how much life is left in the area. Hope this is of some help.

kitdoctor