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Speaker 1: Because the latest rental report is in for Capital Cities,

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Speaker 1: which identified the cheapest rents within twenty kilometers of Darwin,

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Speaker 1: CBD and Molden and Gray top the list for the

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Speaker 1: cheapest median house rents, while Bakewell and Leanya held the

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Speaker 1: lead for units. Now joining me to talk us through

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Speaker 1: these numbers is Core Logics Research director Tim Lawless. Good

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Speaker 1: morning to you, Tim, Let's try that again. Good morning

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Speaker 1: to you, Tim.

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Speaker 2: Good morning Katie. Hope you got me, Now I've got you.

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Speaker 1: Thanks so much for your time this morning. Tim Fursley,

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Speaker 1: what does the latest rental report show for Darwin, Well.

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Speaker 2: It is still an extraordinarily tight rental market. We're seeing

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Speaker 2: vacancy rates across the region at about one point one percent.

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Speaker 2: That's actually lower than what it was last year. And

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Speaker 2: of course with vacancy rates are slow, it means there's

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Speaker 2: still quite a bit of upwards pressure on rents. But

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Speaker 2: we are starting to see rental growth slowing down a

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Speaker 2: little bit and that's probably more reflective of this affordability

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Speaker 2: constraints starting to get in the way of further rent hikes.

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Speaker 2: As rengers yet really really struggled to come up with

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Speaker 2: that type of money is we when you look at.

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Speaker 1: That one point one percent with your vacancy rights, how

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Speaker 1: does that compared to other states and terror trace?

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Speaker 2: It's pretty similar. Darwin doesn't really stand out with an

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Speaker 2: extraordinarily low vacancy rate, at least relative to the other cities.

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Speaker 2: In fact, you can go to some markets like Perish

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Speaker 2: has got a vacancy rate of point six percent, Adelaide

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Speaker 2: that dot a point five percent. The major city like

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Speaker 2: Sydney and Melbourne they're around the one percent mark. Brisbanes

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Speaker 2: have a bit over one percent. So wherever you look,

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Speaker 2: rental markets are extremely tight.

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Speaker 1: And then when you look at the median house and

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Speaker 1: unit rents, how are we looking in the terror tray.

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Speaker 2: Well, we've got a median house rents across across Darwine

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Speaker 2: of six hundred and seventy five dollars a week. Units

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Speaker 2: at about five hundred and nineteen dollars a week in

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Speaker 2: terms of where they were, say a year ago, we've

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Speaker 2: seen house rents have increased by fifteen dollars a week

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Speaker 2: over the past year. Unit rent to rising faster, up

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Speaker 2: twenty dollars a week. So what that might seem a

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Speaker 2: fairly small increment on weekly numbers, you know, you put

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Speaker 2: it into monthly terms or annual terms, and renters, especially

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Speaker 2: with the fact that we've seen rent rising rapidly for

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Speaker 2: a few years now, renters are likely to be really

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Speaker 2: doing it quite tough.

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Speaker 1: Well, especially when you look at the cost of living

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Speaker 1: across the board as well. I guess all of those

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Speaker 1: little increases they add up.

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Speaker 2: That's right, And the rental rental upswing is happening against

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Speaker 2: the backdrop of cost of living crisis, so things like

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Speaker 2: you can't really cut back, you're expending on things like

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Speaker 2: fuel or electricity, utilities, insurance, all those prices are going

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Speaker 2: up as well. I think households more broadly as well

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Speaker 2: as mortgage holders as well. Mortgage holders are paying a

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Speaker 2: lot more in their mortgage or payments. So yeah, it's

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Speaker 2: unfortunately a bit of a perfect storm at the moment.

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Speaker 1: And tim is that what's causing the upwoods trend When

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Speaker 1: you talk about you know, the rental prices.

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Speaker 2: Well, it's really about supply and demand for rental markets.

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Speaker 2: There's more demand than what there is rental supply, and

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Speaker 2: of course with vacancy rates reflecting that down around one percent,

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Speaker 2: it does mean that unfortunately, it's a landlord's market in

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Speaker 2: most cases, which is why we're seeing rents rising. So

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Speaker 2: the best way to solve this is either improve a

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Speaker 2: supply situation bring bring more rental housing in, or reduce

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Speaker 2: the demand situation, which is a lot harder. That really

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Speaker 2: means pulling the lever back hard on migration.

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Speaker 1: Yeah, and both of those are difficult things to do,

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Speaker 1: particularly in a place like the Northern Territory where you

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Speaker 1: know you need a land release, you need to then

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Speaker 1: get get those lots moving. But then even when you

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Speaker 1: look at at the you know, bringing over workers from overseas,

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Speaker 1: it's something that we actually need to fill different job

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Speaker 1: vacancies in the end as well.

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Speaker 2: That is so true. And the other challenge with supply

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Speaker 2: is it costs a lot to build a residential property. Now,

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Speaker 2: construction costs leave me blowing up. Even though they're not

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Speaker 2: growing as much anymore, they're not going backwards. So I

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Speaker 2: thinks for builders the struggle really is now delivering some

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Speaker 2: of the market with a decent profit margin associated with us.

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Speaker 1: Hey, tim tell us which suburbs had the cheapest rents

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Speaker 1: for houses in close proximity to Darwin City Center.

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Speaker 2: Yeah, well, we looked at within twenty kilometers of the

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Speaker 2: city center, so it's all relative. I suppose in Darwin

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Speaker 2: that's that's still some distance, but in Sydney it's relatively close.

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Speaker 2: But if you go to somewhere like Molburne five hundred

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Speaker 2: and forty dollars to rent, there's weekly numbers great at

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Speaker 2: about five hundred and fifty driver five hundred and sixty

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Speaker 2: four a week. Woods are off five hundred and eighty

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Speaker 2: seven a week bake Well five ninety one. So generly

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Speaker 2: houses are more expensive to rent than apartments for obvious reasons,

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Speaker 2: but then the unit sector a little bit more affordable.

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Speaker 2: But rents are actually rising faster across the unit sector,

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Speaker 2: probably because we're seeing more demand deflected towards that sector

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Speaker 2: of the market because it is cheaper. So you're looking

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Speaker 2: for the cheapest units to rent within twenty k's of

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Speaker 2: when it's bake Well four hundred and fifty seven dollars

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Speaker 2: a week, But even some markets close to the coast,

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Speaker 2: like Coconut Growth one hundred and seventy five dollars in

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Speaker 2: the top five there as well.

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Speaker 1: Now, what are the key takeaways for renters? You know,

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Speaker 1: what should they be looking for?

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Speaker 2: I guess, well, it is like like I said, it's

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Speaker 2: really hard for rented. It is a landlord's market with

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Speaker 2: vacancy rates this low. So I think the most important

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Speaker 2: thing is is finding the accommodation for starters, everybody needs

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Speaker 2: a roof over their heads. But once you do find rent,

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Speaker 2: it's quite hard to negotiate. Say, if you're looking at

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Speaker 2: the ad asking rent when vacancy rates are high, you

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Speaker 2: can potentially get away with a bit of wiggle room

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Speaker 2: and get a lower rental rate, especially if you come

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Speaker 2: up with good terms like a long lease or something

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Speaker 2: like that, if you have the references. So I think

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Speaker 2: for rents now it's find the rental property as pay

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Speaker 2: what they're asking and probably lock into a medium term

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Speaker 2: lease or meetiums to long term lead if you can.

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Speaker 2: Considering there's no real signs of rental supply starting to.

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Speaker 1: Rise, tim is it? You know it is now the

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Speaker 1: time if you're an investor and if you've got that

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Speaker 1: money to you know, to get in there and buy

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Speaker 1: yourself an investment property. Is at the time to do it. Well.

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Speaker 2: Darwin's actually looking pretty solid for investment opportunities. It's got

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Speaker 2: the highest gross yield of any capital city. Substantially hired,

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Speaker 2: and say a market like Sydney, where you've got a

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Speaker 2: gross yield of about three percent, Darwin's coming in at

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Speaker 2: nearly seven percent gross yield, so chances are you might

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Speaker 2: even be finding a cash flow positive property in Darwin,

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Speaker 2: so it's paying itself off. And we're also seeing values

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Speaker 2: rising as well, not really swiftly in Darwin like they

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Speaker 2: are in some of the other markets, but up one

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Speaker 2: point three percent over the past three months is still

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Speaker 2: a pretty decent clip and.

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Speaker 1: Growth well, Tim Lawless, I always appreciate our chats. It's

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Speaker 1: always insightful, mate. Thank you so much for having a

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Speaker 1: chat with me this morning.

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Speaker 2: Thanks Katie, thank you you two.

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Speaker 1: Yeah,