Darwin Property Market Update September 2019
No doubt many southerners and locals too are avid followers of the NT News and are familiar with the punchy one liner about some rogue croc eating a pig, another epic Cahills Crossing fail or the halfnaked tourist on a balcony, but Darwin is attracting headlines for more concerning reasons of late – population decline.
These days, a conversation with a local isn’t too far away from being about the state of the NT economy, politics and jobs, which leads to the inevitable question “are you going to stick around?”
It is reported by the ABS that Darwin was the only capital city that experienced a population decline in 2017/18 – apparently the first time in 15 years. Yes, it was a small drop of less than 1%, but in a critical time for the Top End when we need the inverse, it’s a bit of kick in the guts.
Rusted on locals will never leave this place, but Darwin has always been transient and the same reasons that bring people here also take them away again – adventure. Unfortunately, this transient trend seems to be heading in only one direction – south, both numerically and geographically.
I’m no demographer, but it seems to be that commentary around the wind down of the Inpex gas project, which saw about 9,000 workers during peak construction, has had the biggest impact on the population and likely the economy too. Perhaps around half of those workers were the fly in fly outs, and the other half were locals (a term loosely thrown around for anyone with an NT address). But whichever way you look at it, 9,000 jobs accounts for around 8% of the Darwin population at the peak construction. Take away those jobs and it’s just not possible for a place like Darwin to absorb that number of workers back into the market.
The effect this has had on the property market is no secret. It’s been widely reported on and we have seen market contractions in the order of 40% in the unit market and fairly consistently anything from 10% to 30% across other residential markets from the northern suburbs through to outer rural areas. But the thing about Darwin is, because the market is so small, any significant change in Government policy, industry development or a resources boom could see things turn quickly for the Territory. It’s a fickle market. It’s just a matter of when and what will drive the change.
As I said, Darwin is a transient place and the issues around why people leave seem to have been the same forever: displacement from family; the next adventure; it’s too hot; or the next opportunity knocks. What we need to be able to do is attract people back the other way, with first and foremost – jobs (and a promise of a superior lifestyle). Without jobs, it’s very difficult to attract people, despite how good a time we have on the weekends up here.
Politics is beyond me and I’m not going to get into discussing the finer details of the Boundless Possible campaign and whether or not that’s working to bring people up here…but is it politics? Is it the cost of doing business up here putting the brakes on? Is this just the reactions of a small market following the boom and bust nature of a resources boom or is it something embedded in the Australian psyche about its perceptions of the NT – probably a bit of everything. And it will take time to recover.
For now, we are likely to bump along the bottom for a bit, looking for those subtle market changes – consistent increase in market activity from month to month, a decrease in time that properties are on the market, a reduction in properties advertised for sale and the return of equilibrium between demand and supply. Perhaps then we will see the positive shift in median values and a more positive longterm outlook.
Speak with a Darwin Mortgage Broker today.