InvestorKit finds Darwin ‘undervalued’ and ‘one of the easiest’ cities to own an investment property

Darwin is one of the ‘easiest’ places in the country to own an investment property, says a property researcher, who claims the Top End city presents a ‘compelling case’ with its high rental yields. Details.

Darwin has been found to be the most ‘undervalued’ city in the country, according to buyer agency InvestorKit.

Darwin is one of the “easiest” places in the country to own an investment property, says a property researcher, who claims the Top End city presents a “compelling case” with its high rental yields.

This month, buyer agency InvestorKit released its report ‘Overvalued or Undervalued’, which compared every capital city and the 25 most populated regional cities relative to the average local household income.

InvestorKit’s research found Darwin, Perth and regional Queensland have the most potential to boom if rates were to drop by 2 per cent.

Darwin was the only capital city found to be ‘undervalued’. Source: InvestorKit.

Out of the eight capitals examined, Darwin was the only city found to be ‘undervalued’, with its housing market registering just 5.5 per cent growth over the last decade.

Darwin’s median household value was recorded at $575,000, compared to the next cheapest city, Hobart, which was found to be $655,000.

At $1,385,000, Sydney has the highest median household price in the country.

Head of research Arjun Paliwal told this publication Darwin’s local incomes were “well-placed” against house prices and mortgage repayments.

“Darwin’s underperformance over the past 15 years has made it an extremely affordable market relative to local incomes,” he said.

“It has essentially missed two major property booms in the past 15 years: the first between 2012 and 2017 and the second between 2020 and 2025.”

Mr Paliwal says Darwin is “one of the easiest places in the country” to own an investment property.

Mr Paliwal said investors were strategically positioned in the Top End.

“For investors seeking high rental returns, especially in a high interest rate environment where holding an investment property can be challenging, Darwin stands out as one of the easiest places in the country to own an investment property in terms of rent versus repayments,” he said.

“Rising rental pressure and increasing yields further improve conditions for investors holding onto properties.”

The report found Darwin had a ‘high pressure’ rental market with a healthy yield. Source: InvestorKit.

However, Mr Paliwal noted Darwin’s industry composition was “not as diverse” as other cities and relied heavily on mining and defence.

“For long-term investors, risk management is key,” he said.

“Darwin’s property market has been relatively stagnant over the past 15 years, meaning investors may need to consider whether they are holding for future growth or looking to diversify into other cities.”

Although, with workers in defence, mining and health typically relocated north with big housing allowances in-hand, Mr Paliwal maintained Darwin was an attractive option for buyers and could deliver even greater fortune if “key industries”, such as mining, were to boom.

“Darwin’s market presents a compelling case with its high rental yields, affordability, undervalued prices, and rising rental demand,” he said.

“There are significant infrastructure projects in the pipeline, but the key factor will be whether they break ground and materialise.”

Originally published as InvestorKit finds Darwin ‘undervalued’ and ‘one of the easiest’ cities to own an investment property