By Herron Todd White
Alice Springs Property Update
The Alice Springs market showed continued soft conditions for the first six months of 2020 with activity slowing in the June quarter, which was to be expected given the impact of COVID-19 and the restrictions that came along with it. Transaction numbers for the quarter continued the downward trend which was evident last quarter, although the downward trend for this particular quarter was marginal. There were only 40 house sales and 30 unit sales compared with 45 and 27 respectively in the previous quarter. The median house price increased from $457,000 to $471,500 and the median price for units also showed an uplift from $327,000 to $337,500. This is now three quarters in a row where median house and unit sales have increased.
Local agents are reporting that they are busy and following a quiet June quarter, there is anticipation that the figures for the September quarter may show an uplift in overall transaction numbers. We are yet to see any discernible upturn in prices as a result of this reported increase in activity, however agents are upbeat about the local market at present.
We have recently witnessed the sale of the last remaining vacant blocks in the Kilgariff and South Edge land developments. These are the only two active land subdivisions in Alice Springs and the second stage of Kilgariff is at least 12 months away from being ready to be put to the market. This creates an interesting time for consumers wanting to build their own home in Alice Springs and indeed for the building industry also. As the remaining vacant blocks are built on, the stock of vacant land will dwindle away and we shall watch with interest whether the lack of supply results in existing vacant landowners perhaps looking to profit-take and on-sell their blocks. This scenario has the potential to push up the price of land in both subdivisions. Historically, land at South Edge has sold for between $150,000 and $165,000 and at Kilgariff, where the blocks are generally largers, for between $160,000 and $175,000. Expect to see some higher prices achieved as those wanting to build are prepared to pay higher prices to secure this scarce commodity.
This situation is also likely to have an impact on the local building industry, which has been kept busy in recent times as a result of incentivised consumers wanting to build their own home and take advantage of the grants and concessions offered by the Northern Territory government. Some builders report a healthy backlog of work that will hopefully see them through the next 12 months until more land is made available in stage two of the Land Development Corporation’s sub-division at Kilgariff. Others however may need to seek work doing renovations or extensions of existing dwellings or relocate elsewhere in search of steady work.
Certified Practising Valuer
Alice Springs and Central Australia
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