Darwin - palmerston area

[seanry]

So i'm flying up next week, but the more research i do the more i can't help feel the entire darwin seems inflated right now.

Houses in darwin metropolis (if u can call it that) are approaching Sydney prices.

I saw a new listing in palmerston for 600k +.

What are people's thoughts on palmerston surrounding areas like bakewell?

If there are going to be an influx of people for BHP and inpex, do you think people will even look to rent in that area or do you think they would rather go for a some convenient unit in the city.

Thanks for inputs.

 

[Ajax]

Hi Seanry,

a few comments here.

To keep abreast on Darwin developments start reading www.ntnews.com.au daily-usually a few articles on property interspersed with stories of croc sightings, deranged gunmen on the loose, intoxicated youth on rampage etc (you got to read this frontier newspaper sometime). Best ones I've read were about crocs eating running outboard engines off the back of tinnies or the guy whose running chainsaw was eaten when he attempted to clear folliage overhanging a boat ramp or the protest about (any) speed limits on the Stuart highway.

Have heard that units are benfiting from the Inpex deal more than houses (though both are benefiting). Houses in Palmerston area would be close to the proposed Inpex site (and so convenient for workers).

Recent announcements indicate BHP will delay its planned Olympic Dam expansion to 2015.

Bakewell houses seem to be better value than say Gunn. Not sure why this is-maybe proximity to Palmerston cbd of Gunn vs Bakewell.

Prices in all Palmerston areas are rising quite dramatically right now (and many listed for sale are under contract). Rents are also increasing in Gunn.

Managing agents fees are high. Rates are high. Cost of tradespeople is high. 6% gross returns are possible but you need to take into account other property related expenses above. Many properties in Palmerston (and newer units in Darwin) will come with capital works allowance (have a depreciation schedule prepared)

I still think there are $ to be made in Palmerston area. I'd go for the cheaper houses. 600k is out of reach of first home buyers. A 400k cottage may not be.

I bought a 1999 completed 3 bedroom cottage in Gunn in August 2005 for 250k rented for $230/week. Now worth about $395k rented for $420/week.


Ajax

 

[want2bewealthy]

I put an offer in yesterday on a Bakewell duplex, used to live at the other duplex right next door up until a month ago, my mate owns that one so would've been good to purchase next door, the agent wasnt too keen on accepting my offer though, who knows, they might call me back again today if the seller is motivated, asking price was 369k just reduced to 259k ans I offered 330k because the yields arent too great at only $350pw currently on a DHA lease until 2010 but with rental reviews 'regularly'

Im really wanting to get into the market again soon but am finding it hard to buy anything simply because all the cheaper properties are being snapped up without worry, all my offers within the past week or two have either been too late and gone under contract or too low, which wasnt a problem with any others I purchased, or at least agents would be willing to talk and negotiate, right now they seem very unphased and as if they dont have to work to negotiate a deal, it's all just too easy to sell.

I know a deal will come my way soon but when?. .

 

[Alabex]

My brother lives in Palmerston. Loves it.. They bought a house about 6 years back in Driver, sold it 18 months later for a profit in the vicinity of $100k with no work done. They then travelled for 6 months and have now bought another property in Marlow Lagoon (??) just out of palmerston center. If i had the $$$ for an investment property i would seriously be considering the area. His Mother in Law owns investment properties in the area and has always done well.

 

[want2bewealthy]

Oh no doubt, there are alot of properties within the cheaper median price that will generate almost positive cashflow after tax within the first year and still have the good capital growth youd expect from anything else. Im also a fan of Palmesrton and think its much 'nicer' than the Northern Suburbs as far as looks, town planning, parks, footpaths, family living, newer etc,

There are many new land releases announced for Palmerston, it almost doubles the size as a matter of fact, I was looking at the planning on paper, the lots will be sold off over time starting from next year and released slowly as to prevent home owners and investors existing stocks from fluctuating or dropping in price.
The Government seem to be very switched on with local economy growth here.

 

[kero]

marlows lagoon is a quite a nice suburb... i think it stretches through a couple of suburbs... bakewell to moulden... one thing that stands out for ML out of all the suburbs in Palmerston is its block sizes! I think they are at least more than 1000-1500m2 blocks.

i heard about a new suburn call Bellamack... anyone knows info about this or where to find info on it?

thanks in advance

 

[Alabex]

yeah my brothers block is huge - over 1000m2, and there are some HUGE really nice houses around... Lots with well established tropical gardens. Plus it is quite close to the shops/schools etc.

They love the area, i personally just can't get used to darwin being so flat, and hot... i went for a run when i was there about this time last year and got chased by every dog in the street.. frightening stuff. When i returned and advised my bro where i had been they thought it was hilarious as aparently no-one goes running around there because it is too hot... the dogs were obviously wondering what i was doing.

 

[Ajax]

Silly question but are all the lagoon suburbs in Darwin with large land (some 5000 m2) such as Knuckey Lagoon, McMinn Lagoon, Marlow Lagoon prone to flooding in the wet season? Hence the large block size and apparent lack of sub-divsion of these blocks?

Also Wagait Beach/Mandorah and large block sizes here have got me a bit interested (have not visited).

Anyone been here?

 

[want2bewealthy]

Yeah some areas of Mcminn and Marlows gets really flooded in the wet, its like a mote

Wagait beach has done well, very suprisingly because its in the middle of nowhere, Ive been too scared to invest there simply because it goes against the basic rules of capital growth, still it just keeps moving up n up.

 

[phil]

...Also Wagait Beach/Mandorah and large block sizes here have got me a bit interested (have not visited).

Anyone been here?

Long drive to Darwin CBD. Not much there.

My choice would be a 2 bed newish apartment with a water view 0-3 km from Darwin CBD.

 

[phil]

...i heard about a new suburn call Bellamack... anyone knows info about this or where to find info on it?

thanks in advance

I could be wrong, but I heard some blocks were going to be reserved for 'low cost' housing. It is also close to Moulden which has a bit of public housing in the area. Happy to be corrected though.

 

[kero]

mandorah is quite nice... there is a regualr ferry service ... about 30mins boat ride... nice big blocks but not many proper houses i.e. shed type houses are very common... not much retail except for a roadhouse 5 mins drive from the jetty... i enjoy driving to mandorah but it is quite a travel to drive to & fro from darwin.

 

[Gatoblanco]

I used to work at Palmerston Centrelink so I could tell you some stories.
It might put you off wanting to live there.
Having said that Palmerston has had massive massive growth for a suburb that is 55% slum and may continue to good growth.
NT growth is all driven by jobs because of mining gas etc. If that gas facility goes in prices will prob continue to grow.

 

[seanry]

hey guys, thanks for the replies.

I spoke to a few people i know who used to live in darwin and they paint the strangest image of the place. Highlights include

1. Box jellyfish cancelling out the water for 3 months of the year
2. Monsoons as above
3. Apparently a "suicide" season when temperatures are too high
4. NO jobs for the youth unless you want to work in military or government
5. Prices not so long ago netter you much bigger much better properties, e.g 600k for mansion in nightcliff.

Can't wait to get there to dispel/confirm all the stories!

 

[Alabex]

1. Box Jelly fish, sharks and crocs mean the water is a no go pretty much everywhere. That is why most people have pools... there is also good pool complex right near palmerston.
2. The wet season is a challenge, but just part of living in the tropics.
3. True
4. From what i understand there are heaps of jobs, particularly if you want to learn a skill or already have a skill. This is the whole reason my brother and wife moved their. He was an apprentice and she was a nurse. They have changed jobs, brother has changed professions and they have never had an issue getting jobs.
5. sorry dont know.

When you go up there go down to the waterside/wharf complex. It is kinda like a food court with lots of little places and you can buy food and then sit by the water and eat. there is a place their that schnitzels EVERYTHING! i am partical to the croc, but i here the camel and buffalow are not bad either.

 

[want2bewealthy]

Prices around 600k not so long ago netter you a big house along the beach?
yes, standard capital growth, expect to pay double that in todays dollars, in around 2000 these prices were typical,

ofcourse prices before the boom anywhere would've netter you a larger or better place, I thought that was what property investment was all about?

 

[seanry]

Hi Guys,

I thought i'd briefly write my thoughts post visit as people have so generously offered their opinions. First, sorry I didn't have time to meet with anyone, my leave got cut short by one day so I was basically in and out.

Darwin general thoughts - a lot happening. CBD is going up, there's plenty of development and a lot of overseas interest.

Specifically Palmerston area - my thoughts are very mixed.

Elders is a fantastic realtor - all the houses they showed me were in pristine condition. Rooms looked like they were out of an Ikea catalogue.

Ray white on the otherhand showed me all sorts of places. Completely unkept places, defence housing places.

Of course the discerning investor needs to be able to look past presentation. A few things to think about.

1. I spoke to a lot of locals who all felt that palmerston was basically for lower income individuals. I spoke to teachers, miners, locals whoever I could talk to and their sentiments were the same. Plenty of people are on centrelink payments. Why is this a problem? With houses asking around 500k, it makes you wonder who can afford these.

2. Land release : The local council plans to release huge blocks of lands in the 3 neighbouring suburbs with houses going up to meet demand. 10-15% of these are allocated as 'affordable' housing.

3. Fantastic rental yield : It's not just all talk. I was with the realtor and she was fielding calls non stop (benefit of the doubt given). $500 for a 480k house easily apparently.

4. New large commercial development planned for a place called berimar (spelling sorry).

So pros and cons, I think i'll watch the market a bit more and maybe pounce if anything during the wet season turns up where demand will be less.

I'm still learning, so constructive criticism welcome!

 

[Ajax]

seanry,

seems the DHA houses take longer to sell. Do a realestate.com.au search on Gunn and have the prices asked sorted from lowest to highest...most of the lower priced houses (370k-450k) sell quickly with the exception of DHA stock. You are limited when you sell a DHA house as you are targeting investors only vs investors and owner occupiers. Also the yield may look good until you factor in 16.6% management fees (gst incl.) although management fees will approach 10% on a non-DHA property when you add in all extras.

I purchased my IP in Gunn from Ray White (Andrew Lamberton). It wasn't a DHA house. I found Andrew was good to deal with. He seems to have a lot of the DHA stock. Maybe in these more uncertain times DHA rental certainty may be more of a selling point.

Elders manage my property and do a good job.

 

[kero]

Hi Seanry, thanks for the updates.

1. Palmerston is a relative new suburb compared to the northern suburbs. So we'll see a lot relative 'younger' and social status people in that suburb. Within Palmerston, we have the desirable & not so desirable suburbs. The ones that Delfin sub-divided is obviously attractive to the middle income family while the rest not so. Delfin sub-division, namely at the Gunn & Durack, from memory, have no 'affordable housing'.

2. There's a lot of public servants & miners living in Palmerston- Defence & police. But there are as many professional executives in there as well. Most of them working professional couples & young families who prefer to buy a house than rent. One thing though, i still find myself shopping in Casuarina SC when I lived there.

rdgs
kelvin

 

[want2bewealthy]

Again.. I found a nice little do er upperer duplex for 320k today just listed, called the agent and its already gone under contract within a few hrs. . !

they say finance isnt certain so they'll call me later this week if it falls through, god damn it! just goes to show things are still really hot up here.