10 KEY REASONS WHY DARWIN IS A ‘NO BRAINER’ FOR PROPERTY INVESTORS
- Number one in capital city yields.
- Number one for total investment.
- Population expected to triple by 2030 (Source: NT Deputy Chief Minister, Hon David Tollner MLA).
- Existing housing shortfalls. The Housing Industry Association (HIA) estimates that the NT will have a housing shortage of 11,500 dwellings by 2020. NT regional director of the Housing Industry Association, Robert Harding, said 1,900 new homes needed to be built each year to meet demand, but for the past six years that target has not been reached.
- Over 50 Billion dollars in investment across 11 current projects in mining, defence, government, infrastructure and agricultural.
- Up to another 28 potential projects in mining, oil and gas projects set to kick off over the coming decade. Some of the most significant mining, oil and gas projects the country has ever seen are being and will be serviced and supplied through Darwin.
- Strategic location within close proximity to Asia.
- Depreciation components typically double other capital city locations due to high construction standards, building materials and cyclone ratings.
- ‘Multi-tiered Economy’, with Mining, Defence, Government, Agriculture and Tourism all providing economic benefits.
- Limited space to grow within the CBD area with Darwin situated on a Peninsula surrounded by water on 3 sides putting residential property in the CBD at a premium.
Darwin is one of the truly rare locations that can offer investors the best of both worlds. The perfect conditions for long term capital growth along with consistently high rental yields. Add to this the security of Investing in a capital city and it really is a no brainer.
Having been almost entirely rebuilt twice, once due to Japanese air raids during World War II and again after being devastated by Cyclone Tracy in 1974, Darwin is one of Australia’s most modern cities.
The Northern Territory, with Darwin the dominant influence, ranks No.1 in Australia on numerous economic and real estate criteria. It currently has the lowest unemployment rate and is the national leader on growth in building approvals, by a considerable margin. It is also the national leader on growth in loans to owner-occupiers and loans to investors.
Housing demand is high and supply is limited, which is why Darwin has the highest residential rents among the capital cities, both for houses and for apartments – and by a considerable margin. The median house rent for Darwin is now $650 per week, while the typical apartment fetches $550.
Darwin experienced big rental growth in 2012 – median house rents up 16% and apartments rents up 20%, according to Australian Property Monitors – with prices following suit late in 2012 and early in 2013. It is undeniably the market growth leader among the state & territory capital cities. The Greater Darwin Plan, is based on projections that Darwin’s population will grow at least 50% by 2030.
Darwin is the main service centre for industries headed by mining, offshore oil & gas production, pastoralism, tourism and horticulture. The Port of Darwin is the main outlet for Australia’s live cattle export trade into South East Asia. The most important mineral resources are gold, zinc and bauxite, along with manganese and many others. The energy production sector is mostly offshore with oil and natural gas from the Timor Sea, although there are significant uranium deposits near Darwin.
Tourism employs 8% of Darwin residents and is expected to grow as domestic and international tourists are now spending time in Darwin during the Wet and Dry seasons. Federal spending is a major contributor to the local economy as well.
The announcement of the final investment decision for the $34 billion Ichthys gas project in January 2012 has put Darwin on an irrevocable course for growth. The development of the Marine Supply Base adjacent to East Arm Wharf, secures the city’s future as a major oil and gas supply and service centre. For Darwin – strategically placed as Australia’s closest capital to Asia, the growth opportunities over the next 20 years and beyond could not be brighter.