House prices in mining towns jump as COVID-19 keeps state borders closed

There are a thousand touching love stories behind the extraordinary rise in house prices of a far-flung West Australian resources port.

While the 25 per cent year-on-year price growth of homes in Port Hedland has taken many onlookers by surprise, people who actually live there know only too well what’s driving it – the determination of lovers, and families, to be together through COVID-19.

“My husband has been working in Port Hedland for two years as a FIFO [fly-in-fly-out] worker but, with COVID-19 restrictions and state borders closing, he couldn’t come home so we didn’t see him for six months,” said mum-of-four Khristle Barr.

“Since he’s the main breadwinner, we decided we’d all move over and we’d buy a house and stay there permanently, rather than all risk being apart again for so long. And we’re very glad we did. The kids now see their dad every day, and we all love it here.”

It’s a common story, with the pandemic prompting so many of the workers keeping the industry going around the town to buy houses. Many others in Port Hedland have been quitting their rental homes and buying, due to high rents and low interest rates.

As a result, according to the Domain House Price Report for the June quarter, the median price has now risen by a quarter in the last 12 months alone to $350,000.

“We’re seeing a big turnaround in interstate migration because of the resource sector and the resurgence of their prices,” said Nicola Powell, Domain chief of research and economics.

“With border restrictions continuing to change, and industry needing certainty about their workforce, we’ve seen a lot of entire families moving to the region,” Dr Powell said.

It was a decision that has worked out beautifully for Khristle, 35, who’s now also found a job with local government in the town, dangerous goods driver Peter, 37, and their four children, aged 15, 13, six and three.

“There’s such a great community here as so many of us are in the same boat,” Khristle said. “The kids have settled down really well and I don’t think we’ll ever go back east to live now.”

New Zealand vet nurse Zoe Schultz, 22, similarly came to live in Port Hedland to be with her crane-driver and diesel mechanic boyfriend Tom Aim, 24, lured over by the promise of work in the booming town. It’s not always so easy an adjustment, though.

“It’s such a different place from home,” she said. “It’s the complete opposite of everything I’ve ever known. It’s so busy, with the port working day and night; when it’s completely lit up, it’s crazy. The conditions are so harsh here, and it’s all go all of the time, and the scenery is so bare … but I’m learning to appreciate it.”

Those are heartstring-tugging stories that are being repeated now throughout Australia’s main resources hubs, with prices being driven up by a surge of people coming in for work. In the Queensland industrial city of Gladstone, with its massive port, NRG Power Station, Queensland Alumina operation and RG Tanna Coal Terminal, the median house price has leapt 15.4 per cent since 2020 to $350,250.

“I think, with COVID, people have had more time to make decisions about purchasing property and, with rents having gone up so much, they’re saying this is the time to buy,” said Linda Bailey of Ray White Gladstone.

“And we’re getting a lot of people from Melbourne, Sydney and parts of Brisbane as well. So there are a lot more people wanting to purchase. The resources sector is going so well so there are jobs and we’ve also got solar and wind farms now doing well too.”

Out west in Queensland, the lead, silver, copper and zinc mining town of Mount Isa has seen a similar rise in its real estate fortunes. There, Domain figures show an 11.1 per cent rise in the median price to $300,000.

“You could bring 2000 people here today and they’d all have a job by tomorrow,” said John Tully of City and Country Realty Mount Isa. “We’ve got a great education system, wonderful scenery, the town’s improved hugely and there’s a great community.

“Our rents are so high, it’s cheaper to buy now than to rent, and that’s what so many people are doing. People are coming here to the bush, too, as they’re sick of COVID in the cities and having to quarantine when they come and go. Now they’re staying.”

Back in Port Hedland, that flood of people has pushed the market up to highs not seen for years. Rick Hockey of Hedland First National says the supply of homes is now so tight, people are taking one look at homes priced at $300,000 and making offers at $340,00 or $350,000.

“The market has bounced very, very strongly,” he said. “It’s been levelling out a bit more recently, but it’s still strong and we’re getting great prices. There’s been a strengthening of the iron ore market and a lot of smaller projects, and COVID has helped us in not having so many FIFO workers.”

Dianne Lovell of Ray White Port Hedland says rents are very high there as well, which is encouraging more people to buy. “A lot of tenants are now moving out and deciding to buy their own homes,” she said. “We’ve been given a lot of land to sell now and that’s being snapped up very quickly for people to build their own homes.”