Darwin outlook gloomy despite temporary rise: Christopher
Figures put out by RP Data and Rismark showing that capital dwelling values in Darwin increased by 2.4% in April should not be taken as a sign the market has rebounded, according to SQM founder Louis Christopher.
Christopher told Property Observer he does not trust monthly numbers and will wait to see Australian Bureau of Statistics and Australian Property Monitors quarterly figures.
However, his view of Darwin is that the market remains weak, with residents susceptible to interest rate rises given current house price levels.
“I don’t believe this is a turnaround,” he says. “The indicators we have say Darwin is susceptible to a correction.”
Christopher bases his bearish outlook on high stock levels and a rapid increase of stock on the market.
The average price of a house in Darwin is $470,000 – more expensive than Brisbane ($449,000) and Adelaide ($400,000) and not far off Perth ($481,000).
According to RP Data‐Rismark Hedonic Home Value Index, Darwin, Sydney (0.3%) and Canberra (1.4%) were the only capital cities to record positive capital growth figures in April. Perth suffered the biggest monthly drop of -1.8%.
Hotspotting.com.au director Terry Ryder says that after five or six strong years, Darwin’s market has finally paused and there is evidence of price decline. “Recovery will be swift, however, once major gas projects move into the construction phase,” he says.
The Mark at Sydney's Central Park
Now, all signs point south for this market. A year ago vacancies were near zero but today they’re approaching 5%. Price growth has stopped and, according to Australian Property Monitors’ price graph, has started to dip below the red line.
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