Darwin anyone??

Hi All
The youngins have decided to buy a place in Darwin.They would probably rent it out for the first 2/3 years while they completed their contracts in another area.
They are buying with the intentions of it becomming their PPOR.
They would prefer to be very close to the water.
House and land.
They would benefit from a neg-geared purchase as they are both have high incomes.
It does not need to be a palace as they are both quite handy with a hammer.
Budget would be in the 500k to 600k bracket.
So what l am asking if a forum member could give me some idea of areas,[good and bad] prices etc etc it would be greatly apreciated.
Ta
cheers yadreamin
 
Nightcliff, Rapid Creek, Coconut Grove and Brinkin. Near the sea, as in walking distance.

I was about to suggest Cullen Bay and Bayview then realise that the last house I saw for sale in any of these areas were high 700s to low 800s... that was like 10 months ago.

good luck.
 
Thanks kero, any chance of a bit more detailed info on the suburbs you have mentioned?
Where is the market at in Darwin at the moment? up, down sideways?
cheers yadreamin
 
i have an IP in Durack. Was valued at $330k in Jan/Feb 2006. The bank is sending someone tommorrow for another valuation. So till then can;t tell you much about property values.

Mates in Darwin working in the construction/building industry are saying they are flat out with work (so maybe a up sign?)... and i think the territory is still very short of land... not much land for sub division at the moment.

reading on realestate.com about Darwin, there are a bit more million dollar properties compared to two years ago.
 
Am I just biased towards the cheap end of the market or is $500 - $600k pretty hefty for a first PPOR? The non-deductible payments alone would seriously erode serviceability? I know Darwin has shot up in the last couple of years but.......
Alex
 
I think Darwin has a lot of future potential...especially with the increase in military spending in the area.

I do love Cullen Bay...lovely views and close to town.:)
 
I think Darwin has a lot of future potential...especially with the increase in military spending in the area.

I do love Cullen Bay...lovely views and close to town.:)

Even so, just because a place has potential doesn't mean it's worth buying at any price. Wouldn't someone buying in Darwin now be buying after a huge boom? I like CBA shares but that doesn't mean I'll pay $70 for them now.
Alex
 
Hi yadreamin,

they could also look at Bayview. Residex 31 July 06 best rent report predicts 14%pa growth for the next 5 years and 5.06% pa rental yield.

If Residex get capital growth half correct this would be a good result
Residex median value for Bayview houses about 500k. I think that Darwin is the last capital city for prices to move (prices were stagnant when Sydney was near the market top and Perth prices had already started moving...Darwin shouldn't be equated exactly to Perth in the cycle).

Around 1996 Darwin had the second most expensive capital city house prices. About 3 years ago it had the second cheapest...but now the 4th most expensive.

I bought an IP in Palmerston area in September last year for 250k now similar house asking 329k (in Durack/Gunn/Woodroffe/Rosebery/Moulden area) cheaper than Bayview but not close to the the city (21kms out) and not on the water like Bayview.


Ajax
 
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Am I just biased towards the cheap end of the market or is $500 - $600k pretty hefty for a first PPOR? The non-deductible payments alone would seriously erode serviceability? I know Darwin has shot up in the last couple of years but.......
Alex

I hear you alexlee. The way it is though that they already have an ip in another booming north west town getting a big +CF rent return.They are both paid a kings ransom for working in the area they are in and as they are given very very very cheap housing while they are there they thought they would buy a quality ip now in another area and get the tax benefits for a couple of years then move into it as a PPOR at a later date.They are not looking at accumulating many ips at this stage. When you live work and earn in the North of this great country all the numbers are big.So 500k to 600k is pretty average to them.
I think they are doing well.Headed in the right direction from what l can see.

Thanks for the thoughts on Darwin suburbs so far its good keep it comming.
cheers yadreamin
 
Yadreamin,

these are some of the Darwin suburbs that were mentioned in the Residex best rent report dated 31 July 2006 released September 2006. Of their 100 best rent Australian suburbs (with rental yields greater than 5% and predicted capital growth greater than 4.5%pa) quite a few were Darwin suburbs...Alawa, Anula, Bayview, Coconut Grove, Driver, Durack, Gray, Gunn, Jingli, Leanyer, Malak, Moil, Moulden, Nakara, Rosebery, Woodroffe, Wulagi

The suburbs around Darwin's satellite city of Palmerston (Bakewell, Gray, Driver, Durack, Gunn, Moulden, Rosebery, Woodroffe) had predicted yields of up to 14%+pa for next 5 years and median rentals around 6%.

All up 25% of Residex's best 100 suburbs/towns around Australia on the above criteria were in NT.

Ajax
 
The Darwin market is very much at the top of a boom. Still good value in places such as Nightcliff waterfront units because a lot of locals see this suburb as sleazy however the values even here have gone up by 100% over the last three years.
 
Herron Todd White are still caliing the stage of the property cycle for Darwin houses a rising market...see page 32 of their most recent monthly report. Maybe their December report will be different.

http://www.htw.com.au/pages/info_centre/review/HTW MIR November 2006.pdf

They have had Perth at the peak of the market for several months now.

I received Residex's Novemebr newsletter today. They are suggesting caution in the Perth and Darwin markets and to start looking at the more traditional markets of Melbourne and Sydney (houses not units at this stage).

"The interest rate increase did have an impact, but not as significant as many in the market predicted or expected. Interest rate increases have a greater impact on sales volumes than growth rates. They do slow rates of growth and alter a trend particularly in a situation where a market is at the top of a growth cycle. In markets that have already adjusted or are well into their adjustment cycle, interest rate increases have a greater impact on sales volumes than anything else. Hence, expect the increase to impact on Perth and Darwin and close out those growth cycles more quickly. "

Ajax
 
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I hear you alexlee. The way it is though that they already have an ip in another booming north west town getting a big +CF rent return.They are both paid a kings ransom for working in the area they are in and as they are given very very very cheap housing while they are there they thought they would buy a quality ip now in another area and get the tax benefits for a couple of years then move into it as a PPOR at a later date.

Are they in the RAAF ????
 
No they are in the mining and education industries.

Thanks for the info on the different areas.I shall pass it on but as it seems that Darwin is nearing or at the peak of their boom l think they will be far better off to wait a few months. At least they can start looking in specific areas.
cheers yadreamin
 
re:- update since last post on this thread

tenant interested to purchase ppty. REA valued ppty between 415k to 425k. So i'll wait what the tenant is willing to pay. if tenant offering not worthwhile, i'll con't renting it out as its already +ve geared. watch this space. ;)

any news from other darwin property investors? Haven't heard much about the NT market since WA is always taking the limelight for the past few months. :p
 
Hi Kero,

I see ANZ valued your Durack ip at 350k in November 06 and now agents are telling you its worth 415k-425k (in Feb 07). Is that all agents? I wonder what Andrew Lamberton at Ray White says its worth. Have found his appraisals to be close to the money.

I had the same issue with valuations on my property in Gunn...in September 06 bank said my 3 bedroom cottage was worth $295k whilst sales of the same type of house were occurring at $315k...and some agents were saying its worth $330k. For Gunn a good way to estimate price on cheaper houses is to add three 000's to the weekly market rental.

Cheapest house for sale in Gunn at the moment is 340k.

http://www.realestate.com.au/cgi-bi...header=&c=53373385&s=nt&snf=ras&tm=1170952295

Most other listings in Gunn at the lower end of the price scale are subject to contract. The cheaper properties seem to sell fairly quickly.

Am waiting for Herron Todd White's Feb 07 report to see where they think Darwin is in the cycle..imo Darwin house prices moved a few years after Perth and there's no reason why they should cease moving when Perth prices stall.


Ajax
 
crazy isn;t it? but then again, these bank valuers always come under REA's valuation. doesn;t matter to me cos not using equity as yet.

Ajax, try Elders Palmerston. If you like, i'll PM the person to contact. apparently, she's quite a popular REA in Palmerston.

i havent heard news about ppty market in darwin. i guess darwin is still too small for any reporting.

cheers
 
Hi Kero,

I already have Gennie Cox's details...I assume this is the Elders agent at Palmerston you are referring to. She has also been very helpful.


Ajax
 
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