Whilst property prices around Australia have been sluggish, we in the Northern Territory have not seen the level of decline as seen in some of Australia’s capital cities. Based on the recent Q1 median figures released by the Real Estate Institute of Northern Territory, Darwin’s median house price declined by a mere 1.7% to $550,000, whilst Alice Springs saw a slightly higher decline of 2.2% to $455,000.
With sales volumes down 26% for houses and 18.6% for units year on year, we believe that supply and demand of property in the Territory has kept median house prices more stable. Anecdotally based on the number of people coming to open houses and showings, we also know the slight drop in median house prices has encouraged more buyers and investors to enter the market. As a result we anticipate that Q2 median house prices, which will be released in the next 4 weeks, are likely to show the market has remained stable.
With no indication of a slump in the Territory market in 2011, we believe the remainder of this year will produce strong results for both residential and commercial real estate. Our belief is formed on the basis of strong economic activity in the Territory with major resource projects on the horizon, such as the INPEX LNG project. This combined with a strong economic outlook in Australia, Australia’s lowest unemployment rates will keep our local market in good shape over this year and next.