Vacancy rate at 9 percent

According to sqm research the vacancy rate for the Darwin CBD is now 9 percent....

SQM Research - Residential Vacancy Rates

I believe they may have slightly overbuilt high rise units...

Anyway, has anyone seen rates this high before in a capital/large regional centre?

 

Hi, A good friend of mine is a pilot for a private charter aircraft company. He has noticed a shift in the population. With the commodity market changing and allot of projects on stand still many people are leaving!!!.
Will only get higher..

 

Can you tell me are rents exspensive up there because of the inpex gas plant job? I thought vacancy would of been a bit lower from this not true??

 

Sure. Also according to SQM Research statistics, Docklands VIC (postcode 3008) was at around 9% in January 2014. No surprises there. A wind tunnel with few facilities and large gaps in between trams to the city proper.

And also according to SQM Research statistics, in December 2014, Melbourne postcode 3004 (aka St Kilda Road district... lots of apartments in highrises) was at around 20%.

What was that about "you must buy within 5km of the city"?? There's only so many of these things the market needs before it is an oversupply situation. Council can merrily allow more and more development so that more and more council rates can be charged, with no regard for whether there is any demand for the product. Buyer beware.

 

Rents were very expensive. That is changing very quickly however.....(20% drop this year).

There was a time when you couldn't get a place...the town was full. So they built and built and built. There are rows and rows of high rise all coming online now, right after inpex moved all of its workers into camps....

That plus the commodity downturn, apra...and now the town is decreasing in population....its a perfect storm and that's with inpex still in the building phase (8000 workers). Inpex finishes up in a year or two. Will be interesting to see what happens then...

 

It's an isolated country town not dependent upon mining. (Just one less industry to fall back on).

 

Gladstone

 

It is now 10 percent.....

 

I wonder whether there has ever been a property market where developers have not 'slightly overbuilt high rise units'?

 

Yes, there was one. Moscow, Russia - up to mid 2014.

 

What's likely to happen to unit prices now, 10-20+% fall over the next year or two?

Does anyone think the media will use this for more scare mongering stories that the bubble is popping?

 

@proper_noobie if you talking unit prices as in landed (softening in melbourne is likely) been monitoring units, villa prices in a few suburbs(camberwell, burwood, box hill, doncaster, balwyn, balwyn north), some up 200-400K just in 1 year alone. (possibly due to the boom)

Apartment prices (if you got a pigeon hole apartment - very likely yes it will fall) but the ones that are reasonably sized been monitoring prices in CBD, carlton, richmond, southbank, south melbourne has actually risen over the year although nothing significant. There was one time apartments prices dropped circa 2005-2006, i remember 2 bedrooms dropped from 400K to 340K prices. however it went up again over the years.

SHould read the article in theage today on the airbnb - interesting take on individuals who use airbnb as "moguls of new short term leasing". where one guy had 80 apartments and lease them all out. It reminds me of nathan birch using "numbers" to generate the cashflow.

 

Up here it is the opposite. The local rag depends on real estate ad revenue. They keep putting out positive stories....

The reality is that it needs to drop by another 20 percent so Darwin can move on.

A friend of mine was recently trying to rent in the city and no one would move on price. He went to 10 units that had all been vacant for over 2 months and the owners would rather keep it vacant than rent it out for less. Not sure on the logic here....

It's the same story with sales....people are still trying to flog 2 br units for 600k....the only ones which are moving are priced at 350k....

Time shall heal all....

 

The question will be whether the Australian perspective will change, I wouldn't think that any of the Australian cities actually have an oversupply of high rise units as much as a mentality that living in an apartment is for lesser humans and not part of Australian life.

You look around the world and the Australian cities have some of the worst sprawl and transit times, I wonder whether there is a breaking point where people start to view living in apartments favourably or if the Australian dream will continue to trump all else.

I know ancedotally that more and more of my social circle are either buying units or renting them because of the considerably better lifestyle they afford for most areas of life.

The other thing I've noticed is the extortionate strata fees that apartments carry, if they ever start being regulated and brought to a reasonable level then that would also help increase demand for them rapidly. I looked at a couple of nice apartments that had 10k a year in strata fees and there wasn't even a pool or shared facilities. There is a reason that basically no real estate agents advertise the strata fees in ads!

 

Average is around 3K per year in melb. 10K a year without a pool? perth must be expensive. In melbourne apartments commanding 10K in owners corp are the more prestigious buildings - like the freshwater place (which has 2 pools) one a higher level which you can swim overlooking the yarra river and another lap pool. They also have a large outdoor garden the size of 1000sqm. Others more prestigious buildings are eureka.

 

It's certainly not the norm, I'd say 3k is probably about the same here as the average from what I've seen (still an outrageously high amount if you think about it!). I couldn't believe when I asked what the strata fees were (it would have made a very decent investment prior to that...)... did not go any further on them!

 

This times a million. Strata here is 6-7 k pa for a high rise, 12 k pa for the super dooper ones. Just kills it as a place to live and an investment. You're paying $150+ pw rent for your own place.....

 

The way I look at it is with 3k owners Corp if u work in the city which basically all the corporate jobs are u can basically walk a short distance and use the free trams in Melbourne CBD or if directly in CBD use the free trams right away. That alone would be 1.5k savings in train and transportation costs if living in a house in the suburbs. Also covers building insurance as in fixtures and fittings like kitchen and flooring etc which is ard $500 so give or take 2k per year u can eliminate paying. U also have on the premises security 6pm -7am and common area cleaners daily etc.

 

6-7K is pretty high. high rises in melb are around 2-4k mark depending on the age of the building

 

Cyclones.....

Smaller, older unit blocks are around 3k pa which is not too disimmilar to holding and maintaining a house up here. It's the new high rise that attract the stupid Strata...