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After five years of decline, property prices and sales volumes across the Northern Territory have finally recorded positive movement, new data has revealed.
The June 2021 quarter data from the Real Estate Institute of the Northern Territory (REINT) has shown an improvement in both sales volumes and pricing across the state.
Unit market
Since June 2016, the REINT found that the median unit price across the state has declined almost every quarter, ultimately resulting in a 44 per cent decrease in just four years.
But from June 2020, prices “have been gradually returning”, according to REINT CEO Quentin Killian.
Fast-forward to the June 2021 quarter, median unit price lifted 20 per cent compared with the previous quarter, to $396,500 — although this remains almost 21 per cent lower than the median recorded in June 2016.
“The key reason for the upward movement in the median is the higher sales prices this quarter,” Mr Killian said.
“While in March we saw the large bulk of unit sales under $350,000, in the June quarter, we had more sales in $350,000 to $600,000 ranges and saw 27 sales over $600,000.
“This indicates that the general sales prices are rising, and quite rapidly, and there is now limited stock in the range under $350,000.”
However, it’s not been a synchronised movement across the state.
Bucking the trend was Alice Springs, where sales volumes more than doubled over the quarter, but the median price fell by almost 10 per cent.
Mr Killian said this points to “some very favourable buying opportunities in the Alice Springs unit market”, where median unit price is currently at $333,500.
Housing market
Similar to the unit market, the housing market has also experienced growth, with volumes rising by 32 per cent over the June 2021 quarter — and approaching 80 per cent higher than volumes seen during the same time last year.
Across Greater Darwin, the median house price increased by 6 per cent over the quarter to $580,000 — 21.5 per cent higher than last year, but still around 7 per cent below the market peak in March 2015.
Looking at the suburb level, Katherine saw one of the highest quarterly growth in median house price at 34 per cent to $395,000. Alice Springs, meanwhile, lifted by 6 per cent to $497,000.
In terms of sales, houses also performed strongly, with Palmerston among the leaders, boasting a quarterly rise of 36.5 per cent and an annual rise of 98.7 per cent.
Alice Springs also saw sales volumes jump up by 10 per cent over the quarter and a massive 112 per cent over the year.
Rental market
Even the rental market has been in on the positive action, the REINT data has found.
Vacancy rates continued to fall over the June 2021 quarter, with Greater Darwin dropping to 1.5 per cent. Katherine and Alice Springs also tightened further to 1.3 per cent and 2 per cent, respectively.
However, some areas still struggle, with Palmerston seeing vacancy rate rise to 1.8 per cent and the rural market to 3.7 per cent.
But yields remain strong across the state, at 5 per cent for houses and 5.4 per cent for units.
Land market
The one area where the Greater Darwin region saw declines was residential land sales, according to Mr Killian.
Sales volumes fell by around 75 per cent over the quarter, while the median price held relatively steady.
“We saw an exceptional jump in land sales in the March quarter, but with both a shortage of supply in residential land and the end of the Build Bonus incentives, we have seen those volumes fall substantially,” the CEO noted.
Looking ahead
While the Northern Territory market appears to be in a positive trajectory, Mr Killian expressed concern about the future of buyer activity.
According to him, the removal of government incentives could hinder buyers — particularly first home buyers — from getting into the market.
“The one thing that continues to concern the profession is the removal of the First Home Buyer stamp duty concessions by the NT government on June 30 this year. This increases the cost of getting into a first home by upwards of $30,000, in most cases,” he said.
“While the definitive data will not start coming through until the September quarter, we are already seeing evidence from our members that the first home buyer market has slowed dramatically.”
With less people making the move from renter to home owner, the rental market could potentially suffer from undersupply as well, the CEO added.
Mr Killian is thus calling on the government to bring back incentives that could further assist the market rebound.
“We call on the Chief Minister or Treasurer to reconsider what we feel was a very ill-advised decision, and to reinstate the stamp duty concessions for first home buyers in the territory as quickly as possible,” he concluded.
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