Property Council of Australia's NT Executive Director Ruth says although residential building approvals increased by 50 percent in the last quarter, residential builds have declined, with only 57 homes built, noting workforce shortages, the cost of construction and getting land to market are key challenges

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Episode Transcript

Speaker 1 (00:00):
Confidence is building in the territory's economic and housing outlook,
according to the Northern Territory's latest Property Sector Report. The
quarterly report, which tracks key indicators, is designed to inform
government and also guide private sector investment and shape long
term policy decisions. Now joining me on the line to
break down the findings is the Property Council of Australia's

(00:23):
Northern Territory Executive Director Ruth Palmer. Good morning, Ruth. Let's
try that again. I've done something wrong with the phone there.
Good morning, Ruth, Katy. I'd love to say I'm having
tech issues, but it's always operating error on my part, Ruth.

(00:43):
I can't have been in here a while now, Ruth,
tell me obviously. It is the Northern Territory's latest Property
Sector Report. What did the report show for the March quarter?

Speaker 2 (00:56):
Yeah, thanks, Katie, And as you sort of pointed to
in your opening, we are seeing a bit of momentum
which is great. We have seen residential building approvals up
by around fifty one percent, construction activities up around five percent,
so at about nine hundred and five million, and our
regional sales are up. But what we have seen is

(01:17):
a decline in actual residential builds. So while we're seeing
this like huge growth in approvals at fifty one percent,
the actual residential bills are down. So we're only seeing
around fifty seven homes built across the entire territory in
the quarter, and that's kind of becoming a bit of
a trend. So, yes, we've got approvals up, our construction

(01:37):
activity across a hole is up, but those houses just
aren't being built quick enough to be able to service
that supply.

Speaker 1 (01:45):
Yeah. Right, So we're like, where do we sort of
go from here, because I suppose we've sort of we've
been talking about this for a little while, haven't we.

Speaker 2 (01:55):
Yeah, yeah, exactly, And we know at the moment rents
are quite tight, so that tells us demands wrong. But
without that supply, affordability is going to remain a challenge.
So the Fast Track Approvals Task Force handed down their
recommendations yesterday, and in those recommendations, we're a lot of
things that we've been advocating for, sort of that cutting

(02:15):
the regulatory burdens for people to be able to get
construction activity happening quicker. They're bringing land to market that's
going to be implemented quicker, so you know where land
is available to build on. But one of the big
issues is around our workforce. We don't have the workforce
here to be able to meet the demand of the
construction activity, and that's our tradees and everything like that.

(02:37):
So we need to bring the workforce back. But it's
also cost of construction as well. So we know that
supply has gone up, material is up, which is pushing
things out. But you know we've got all those approvals
there a fifty one percent jump. Those people want to build,
so we need to get them into their homes because
again they're going to be paying rent while they're trying
to service a mortgage while they wait for their home

(02:59):
to be built. So you know, we really need to
get things moving quicker in that space.

Speaker 1 (03:04):
I mean, then when you talk about rent, tell us
what were the labors findings around the rental vacancy rates.

Speaker 2 (03:11):
Yeah, so in Darwin it's sitting around three point three percent,
so it's very tight, but Alice Springs it's even tighter.
That's around two point nine percent. Now there's a bit
of a story going on in regional Australia. You know
they saw their house medium prices going up quite significantly
from about full fifty to just over five hundred thousand dollars.

(03:31):
But what we're seeing is a lot of interstate investment
coming in, so buyers agents speaking to the local agents
here and basically buying a lot of properties sit unseen
because the territory is the most affordable place to buy home,
but it actually attracts really good rental yields. So people
are coming in, they're snapping up these properties, often not

(03:53):
even looking at them. It sometimes doesn't even go to
the market, but they're getting really good rent returns. But
that tightens the market it and without that additional supply
coming on board, then we're going to have a real
struggle around where that where the rental market sits and
the lack of properties available for renters.

Speaker 1 (04:11):
Yeah, hey, I mean did the report delve much into
the house and units prices?

Speaker 2 (04:18):
Yeah, so we do go into that, so it goes
into what our median prices are. So rentals at the
moment in Darwin it was a little bit down from
the previous quarter, so around six hundred and twenty five
dollars a week is the average, but that's usually a
house that could be worth four fifty to five hundred,
so four hundred lights five hundred thousand dollars to buy,

(04:39):
so usually it should balance itself out, but it's not.
We still have quite higher rents compared to the house prices.
And in Alice Springs it sits at around five hundred
and seventy dollars a week and that's for our median
house rentals, and then in units it sits very much
almost the same, so they're kind of hand in hand
around w the units are doing as well as the

(05:02):
house rentals. So what we need to do is sort
of work around that supply issue. But also is there
a story then to encourage people to then get into
home ownership as well. Some people might not want to
get into home ownership, They might like to rent and
that you know, that's people who might not want to
live in the territory for a long time. But we

(05:22):
need to be looking at ways to incentivize also people
to buy their homes and open up other homes. But
also have you know, more building activity across the board?

Speaker 1 (05:32):
Hey, Roth, I mean you and I have spoken a
lot in the past about the impacts of crime on
businesses and also on property owners. What were the latest
findings in that space.

Speaker 2 (05:42):
Yeah, so this was a big thing we wanted to
make sure we included in the report because it does
impact everything that we do. So in our report we've
got our crime, we've got tourism numbers as well. So
seventy percent of our property crime that we saw is
around theft or damage and it did increase in the
latest court so they're not things we want to see
and the month or months change. It had also increased

(06:04):
even from February to March onwards, and that's obviously causing
issues around bringing people in because our tourism even through
the sort of start of the dry was only up
by one percent from our wet season, so that's that's
not a it's not a high number. So to only
increase one percent for the start of the dry from wet,

(06:25):
you know that that's obviously painting a picture around what
people are feeling, where they're deciding to travel, where they're
putting their money. But we can't unlock the territory's full
potential without tackling those big issues. So we know safer streets,
smarter planning, stronger tourism, but unfortunately the crime is having
that impact and obviously around growing the population. But with

(06:47):
the fifty seven, well the fifty one percent of building
approval sitting there waiting to be built that we would
think would draw a workforce. So we need to have
housing for that workforce. We need to be able to
provide them with safe you know, safe places to be
able to sleep and obviously have that liveability peace to
want to retract that workforce here ruts.

Speaker 1 (07:09):
I know, obviously the report is talking about, you know
the fact that confidence is building, like if we're still
seeing those issues around crime, and a lot of respondents
are saying we're still seeing those issues around crime, and indeed,
you know, not seeing a huge jump in tourism numbers
and that kind of thing. What do you reckon it
is it's sort of giving people a little bit more confidence.

Speaker 2 (07:30):
Well, there was definitely the incentives that the government had
put out with their homegrown building grants. From what we understand,
not many were taken up with the fifty thousand, but
we know there was quite a few of the other
incentives that were taken on. But also, as I've touched
on before, how some land packages in the Northern Territory
are quite affordable. So it is it is a place

(07:52):
where we can invest in in an affordable way, Like
if you're looking at a five hundred thousand dollars build
or six hundred thousand doll build, compared to that same
product down south, they're looking at well over a million.
So we are in a really good position where we
still have affordable house prices and also you know, we
do have the land available, but it's unlocking at quicker,

(08:14):
So it's getting the regulatory approvals moving quicker, streamlining, you know,
having that process done, and we hope that the task
force recommendations that came out yesterday will be implemented immediately
and we can really start fast pass tracking those and
you know, especially with urban infield or dual occupancy. But
you know, I know you were speaking to Luke Goswin

(08:36):
just previously. You know, there's a whole big story about
retirement living, you know, encouraging and aging population to come
to the territory. We know forty two age care people
are in the beds in the Palmston Hospital, whereas they
should be appropriate housing for them. So you know, there's
a whole body of work that needs to be looked
at in a way that we can grow the territory

(08:59):
sustain but also you know, grow it economically and have
that liveability, have the services available for all Territorians to
be able to access, whether it's health, education, lifestyle, because
that's going to be what's going to drive everything in
the future.

Speaker 1 (09:13):
Spot on and making sure that you know that we
have the services available as well for people as they age.

Speaker 2 (09:21):
Yeah, that's right. And you know, we spoke about this
at our event. It was a really it was a
really powerful conversation and one of the things the keynote
said at her end of her sort of conversation was,
We've got to stop thinking about it being them, it's us.
We have to plan for us in the future because
eventually we're going to be the ones that require the
care or the services or the dementia services as well.

(09:43):
So we know that that's a big issue here. And
you know, having couples who have been married for fifty years,
they get separated at their sort of up when they
are aging or if one of them requires more care
than the other. You know, we would want to hope
that we can build appropriate housing for people to be
able to live their end of life together and not
be separated. You know, that's the really sad thing to

(10:04):
think about that you spend so long with someone and
then at the end you're doing it alone.

Speaker 1 (10:10):
Which is just yeah, that's terrible.

Speaker 2 (10:12):
Yeah it is. So we just need to make sure
that we have these appropriate homes, appropriate services that people
can feel comfortable in, and we have to stop thinking
about them and looking at us and what we want
and what we should have, you know, inclusive dignified places
for people to be in and if they want, you know, together,
that's a different thing. So you know, we've started the conversation.

(10:36):
We've kick started that, so we you know, we hope
that that momentum keeps going.

Speaker 1 (10:40):
Yeah, well, Ruth Palmer, it's always good to catch up
with you. Thank you very much for joining us on
the show this morning.

Speaker 2 (10:45):
Yeah, sank Katie. There was a lot in that one,
so oh that's all right.

Speaker 1 (10:49):
That always good. We always love a good chat where
there's plenty to cover off on