01Where the term turns up
The words real estate turn up in many places. They appear on signs and in listings, in the paperwork that goes with a purchase or a lease, and in ordinary talk about a market that has gone quiet or busy. People meet the phrase at very different points in their lives, and the setting shapes what matters to them.
Because the term covers such wide ground, any account of one market is only that. A quiet street, a busy inner suburb and a city at the edge of a boom can all sit inside the same subject, and each can behave quite unlike the others.
02How one market moved the other way
Markets do not all move together, and one commercial report on Darwin made that point. It said the Northern Territory capital had managed minor growth while values in the other capital cities declined, and it drew on recent data to say so. The director of a Darwin agency said in that report that the city often behaves independently of the other capitals.
He called Darwin countercyclical, and said this was not the first time. He remembered the Global Financial Crisis, when Australia was in a downturn and Darwin was, in his words, 'in its own little bubble'. He said it was common for Darwin to do well when the largest cities, Sydney among them, were doing badly.
The director put that resilience down to relative affordability, rental yields and a tight supply of homes, and said units at the lower end were the ones then driving the market. He said buyers at the lower end of the range included first home buyers competing with investors from interstate, while local owner-occupiers and people after a second home were more active higher up.
He called Darwin countercyclical, and said this was not the first time.
03Questions people ask
- How does real estate work?
- There is no one answer that fits every market. What a market does depends on who wants to be there and what is available, and the way one city behaves can be quite unlike the way another does.
- What does countercyclical mean in real estate?
- The word is used when a market moves against the wider trend. A director of a Darwin agency used it to describe a city that often goes well when the biggest cities are going badly, and said Darwin had done that before.
- Why would buyers look at cheaper units?
- A Darwin agency director said most of the growth in detached houses had already happened, and that cheaper units were then the part of the market creating movement. He said buyers at that end included first home buyers and investors from interstate.