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CoreLogic NSW housing Update May 2018
CoreLogic QLD housing Update May 2018
CoreLogic SA housing Update May 2018
CoreLogic VIC housing Update May 2018
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Darwin May 2018
The month in review: Darwin
By Herron Todd White
When you think about prestige property, waterfront dwellings instantly spring to mind and Darwin is no different. It’s got a wealth of waterfront suburbs, with the top inner suburbs being Larrakeyah, Fannie Bay, Nightcliff and Bayview. But it’s not just waterfront properties commanding the big price tags.
Knuckey Lagoon, a rural residential suburb (approximately 18 kilometres from the CBD) with one and two hectare blocks also offers a prestige level of residential accommodation. The top end of the market chasing acreage instead of views heads to Knuckey Lagoon. This is a very tightly held location, however all of the four sales in the past 18 months have been at $1.2 million or above.
Taking advantage of the Top End’s tropical climate is a major feature of prestige dwellings. High end properties in Darwin boast excellent outdoor living spaces, often centred around swimming pools, established gardens, barbecues and outdoor cooking facilities. With the climate allowing for outdoor living all year round, increased outdoor living space is an attribute of prestige dwellings in Darwin that is unlikely to be given such prominence in prestige dwellings in the southern states with their more defined seasons and longer winters.
The market for prestige dwellings in Darwin’s inner suburbs has softened over recent times. The traditionally popular suburbs of Larrakeyah, Fannie Bay, Parap, Stuart Park and Bayview have been less volatile than mortgage belt locations and continue to be underpinned by proximity to the CBD and standard of dwelling. Even the upper end of the market has not been immune to reductions in the market.
If disposing of a property at the upper end of the market, it must be acknowledged that demand for this type of property is limited by the amount of purchasers capable of securing property of this capital value and it is reasonable to assume that an extensive marketing campaign of up to twelve months may be necessary to achieve a sale in today’s market. In some instances an extensive marketing campaign would also be required to effectively target the Australian markets. If a sale was required in a short time frame or under distressed vendor conditions, than some discounting should be anticipated due to lack of market exposure.
The very premium end of the market in Darwin, being property in excess of $6 million is a relatively untested market with historically very few properties falling into this category. $6 million is generally considered to represent the ceiling for property in Darwin and potential purchasers would appear to be loath to exceed this amount unless the property represents a significant land holding with similarly significant improvements. The subject property falls below this subset. In this price range, property is generally illiquid with very few available and a limited number of purchasers with the capacity to service this quantum of money. Purchasers within this price bracket are typically motivated somewhat differently which ultimately impacts on the overall sale and accordingly sale prices for properties of this nature can fluctuate greatly. Properties of this nature are tightly held and thinly traded. They are often subject to personal taste and given the relatively few buyers for properties of this price bracket, the market is often subject to a far wider value range than more frequently traded property. Arguably Darwin’s finest two streets are Larrakeyah Terrace in Larrakeyah and East Point Road in Fannie Bay. Properties in these streets enjoy views across Darwin Harbour and Doctor’s Gully and across the foreshore and Fannie Bay. These locations are held very tightly, with very few on market transactions occurring. The most recent settled sale within these locations was 122 East Point Road, Fannie Bay which sold for $4 million. Another key sale was of 19 Lambell Terrace, Larrakeyah which was purchased for $2.5 million. It appears the intended use of this site will be for residential occupation following a re-zoning from Community Purpose land.
So where to for the prestige market? For market participants with time, it is likely that the market will remain relatively thinly traded. Many owner occupiers will choose to sit on their homes instead of selling under weaker market conditions. For those looking to enter the prestige level, it is an excellent time to be buying in Darwin. The value being achieved in sections of the prestige market is very good at present, with sales appearing well below the overall replacement of the dwelling and land.
DISCLAIMER: The information contained in this article is correct at the time of publishing and is subject to change. It is intended to be of a general nature only. It has been prepared without taking into account any person’s objectives, financial situation or needs. Before acting on this information, Smartline recommends that you consider whether it is appropriate for your circumstances. Smartline recommends that you seek independent legal, financial, and taxation advice before acting on any information in this article.