Darwin homeowners and landlords are preparing for a significant surge in activity when the Northern Territory’s borders reopen on 17 July 2020, declared a local real estate expert.
Raine & Horne Darwin General Manager Glenn Grantham said even before the border announcement this week, he had received six rapid-fire bookings for a holiday rental apartment in the Darwin CBD.
“Typically, at this time of year, this penthouse apartment in the stunning Oasis building books for weekends only. The six bookings are for week-long stints,” Mr Grantham said.
“All six bookings have been made by southern state holidaymakers, who are seeking a winter getaway.
“With international borders currently closed, Darwin fits the bill perfectly for tourists. However, holiday accommodation will be tight.”
Darwin has a vacancy of 2 per cent, the city’s best in seven years, while the number of vacant properties available for rent is about 50 per cent lower than June 2019, according to data from Raine & Horne Darwin.
“There are only 700 properties available in Greater Darwin, and we’re filling them fast,” Mr Grantham said.
Given this major supply shortage, he said he expected some severe price pressure on Darwin’s already competitive average rental yield of 5.8 per cent for the remainder of 2020.
“Even where holiday properties are attracting $500 a night, we are getting some significant bookings from southern state tourists, who due to international border closures, consider Darwin as the closest alternative within Australia to an overseas holiday,” Mr Grantham explained.
“Darwin is on plenty of bucket-lists, and we believe many Australians will visit this city for the first time over the next few months.”
The possibility that construction work on Charles Darwin University’s CBD Campus will begin as early as July will also add to the pressure on Darwin’s tight rental market.
“This construction project will require interstate tradespeople, who will be seeking permanent rentals,” said Mr Grantham.
Southern visitors will try before they buy
Based on experience, Mr Grantham said most interstate buyers generally holiday in Darwin before migrating permanently.
“With the surge in first-time visitors and based on the city’s real estate history, plenty of these tourists will make a permanent shift to Darwin.
“The ‘try before you buy’ approach will work well again for the property market as tourists will land in Darwin in the dry season, which is a beautiful time of year with average days of 32°Celsius and no humidity.
“For those vendors considering a sale, be prepared for an influx of interstate purchasers between now and September.”