Darwin: The last capital standing for growth

Recent data from Cotality found that the Northern Territory’s capital had resisted the downturn impacting the rest of the nation, recording minor growth while others declined.

Real Estate Central director Daniel Harris said Darwin often acted independently of the other capitals.

“This wouldn’t be the first time that Darwin has proven to be countercyclical. During the Global Financial Crisis (GFC), when Australia was in a downturn, Darwin was in its own little bubble doing its own thing, oblivious to what was going on with the rest of the country,” Harris told REB.

“It’s really common for Darwin to go well when Australia’s biggest cities like Sydney are going badly. It’s uncanny how often that has happened if you go back through history.”

As the downturn gripped the rest of the nation, Harris said Darwin was still at a very different stage of its property market cycle.

“We’ve been through booms and busts. We should be completely booming right now, but all the factors affecting the rest of the country have played a little bit of a role and slowed us down, but it has proven to be very resilient.”

He said Darwin’s low property prices had kept the market floor from falling too far, with the city’s relative affordability ensuring consistently strong interest from a range of buyers.

Similarly, Harris said the high rental yields were enough to keep investors interested in Darwin.

“We have by far the highest yields in the country, and you match that with being the most affordable capital city in the country.”

“Yet our prices are so much lower, so we’re still attracting interstate investment from people seeking cash flow properties.”

“You can buy a unit in Darwin for $450,000 and get $650,000 per week in rent; you just don’t get that in other places.”

Additionally, he said the tight housing supply kept a healthy level of competition for homes.

Despite the supply shortage, he said the city continued to see a relatively consistent volume of sales.

Overall, Harris said Darwin’s market had continued to perform strongly, despite the economic headwinds impacting the rest of the nation.

“We aren’t seeing crazy booming conditions, but we’re seeing a really healthy marketplace, far healthier than what a lot of other places are experiencing.”

“It’s proving to be incredibly resilient. We’ve had all these factors thrown at it in the last three to six months, and yet it's still holding firm.”

What buyers are after

Harris said investors were targeting cheaper units, as most of the value boom in the detached houses had already happened.

He said houses were the hot property choice for investors 18 months to 2 years ago, and units were following a similar trajectory.

“It’s the cheaper units at the moment that are driving the market and creating that growth.”

According to Harris, properties below the $750,000 mark remained a popular option for buyers, with first home buyers competing with interstate investors.

Once prices went above $750,000, Harris said most activity came from local owner-occupiers or those looking to buy a second or third home.

Looking ahead for the Top End

Bolstered by its strong fundamentals, Harris said the Darwin market would likely continue resisting the downturn facing the rest of the nation.

He said that while there wouldn’t be significant growth for the remainder of 2026, the combination of major mining projects and money flowing into the economy had left Darwin well placed for growth in 2027.

“I think it will get closer to catching up to the median prices in other capital cities.”

“I'm predicting next year, Darwin will be the strongest market in the country. We simply don't have anywhere near enough supply for our population, which is expected to surge.”