Regional NT Property Market Update March 2020
Alice Springs Property Updates
Now that schools have re-commenced for 2020 and all the holidaying locals have returned to Central Australia, the residential market is beginning to wind up again and we are seeing an increase in sales activity after the traditional Christmas and New Year lull.
The residential market remains flat, with capital growth being something every home owner is chasing, but it is proving to be very elusive for anybody who has bought property in the past six to seven years in Alice Springs. Unless homes have been renovated or extended, we are seeing values being largely stable and in some cases (and specific locations) going backwards. This of course presents an opportunity for buyers and suburbs such as Gillen, Larapinta and Sadadeen are seeing some very well priced properties being snapped up.
These buyers are typically young, owner-occupiers and first home buyers taking advantage of the government incentives in place. There are also a number of upsizers and downsizers active in the market which is keeping the dwelling sales numbers from completely plummeting. Alice Springs has a fairly transient population and in many ways, operates in a similar fashion to a night club – generally every individual or family leaving the area is replaced by another individual or family coming in to the area. This doesn’t promote population growth and without population growth, it’s difficult for a real estate market to thrive. Unfortunately, there are a finite number of opportunities that attract people to Alice Springs and given their transient nature, many people are content to rent rather that enter the local property market.
A recent sale of a circa 1980s two-bedroom, one-bathroom unit in the suburb of Sadadeen has highlighted the downward pressure being brought to bear on older units. This particular unit was sold in February 2010 for $340,000 and was sold again in April 2016 for $300,000. It has just been sold again, this time for $225,000. Ignoring for a moment the depreciating nature of the asset (that has not had any major renovation work done during the past ten years), this represents a 34 percent reduction in value over the ten-year period. Another case in point is a two-bedroom, one-bathroom unit in a large 1980s complex that was sold in 2010 for $342,000 and has just recently gone under contract for $247,500, representing a drop of 28 percent in ten years.