Strata Title Insurance Relief in the Far North Rejected

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A 12-month moratorium on the stamp duty paid on body corporate insurance has been ruled out by the State Government.

The decision follows a call by a body corporate industry leader to commit to a recommendation from a federal inquiry into residential strata title insurance last year that the Federal Government liaise with the Queensland Government to implement a 12-month moratorium on stamp duty to give some relief to property owners facing soaring bills.

Archers Body Corporate Management director Colin Archer said the 12-month stamp duty moratorium would provide a rebate equivalent to additional tax paid by North Queensland home owners on top of extra insurance costs.

But a spokeswoman for the State Treasurer Tim Nicholls said a moratorium would “not address the underlying causes of rising insurance costs.”

“The Queensland Government has no legislative jurisdiction over general insurance matters and cannot intervene in the decisions made by private companies as to the level of premium payable,” she said.

“Providing an exemption to specific types of entities in specific regions of the state would be inequitable to others who have been similarly affected.

“Duty exemptions for body corporate insurances would establish a precedent with potentially significant revenue consequences for the state.”

The spokeswoman said Queensland has the lowest rate of duty on strata title insurance in Australia.

“Land tax in Queensland is 20 per cent lower than the national average and transfer duty (stamp duty) is 12 per cent below the national average,” she said.

Article printed by The Cairns Weekend Post - Saturday 9th February 2013

Peter Musso licensed real estate agent at Ray White Smithfield selling property in Cairns' beautiful northern beach suburbs including Trinity Beach, Kewarra Beach, Clifton Beach, Palm Cove, Trinity Park, Smithfield, Yorkeys Knob, Holloways Beach, Machans Beach, Caravonica, Kamerunga and surrounds.

Herron Todd White Cairns - The Year Ahead

As one of the many avid readers of the CairnsWatch report released by Herron Todd White I have followed the data presented with keen interest each month in and out for over the past 5 years. In the December 2010 edition of the CairnsWatch report it was officially stated that the Cairns property market was at the bottom of its overall cycle. Two years on and the CairnsWatch report still confirms that Cairns remains placed in the same position within its cycle although a general decline in median values throughout the region has been seen within that time. 

Herron Todd White can be forgiven for perhaps being a little too optimistic in their assessment of the future for the local economy at the time - whilst many areas within Australia have seen great recovery following the Global Financial Crisis, Far North Queensland has not been so lucky and to say that local business conditions throughout the past 4 years “have been tough” is a severe understatement.

We can only remain positive, and due to several important local economic developments (discussed below) we are currently experiencing our highest levels of local business and market confidence since the GFC first affected the region in early 2008. Herron Todd White’s assessment for the year ahead follows…

The Cairns residential property market remains at the bottom of the property market cycle, but there is light at the end of the tunnel with some tentative signs of consolidation that will continue during 2013.

The local economy is progressively improving, aided by a much stronger tourism season during 2012 and the recent start-up of direct air flights to China delivering greater numbers of Chinese tourists to Cairns. 

However it is taking a long time for these developments to filter through to the improvements in the consumer confidence that is needed to resurrect the local property market.

The building industry also appears to be making a comeback, with the latest statistics showing a 39% year-on-year increase in the number of building approvals issued for new house construction. Even so, conditions in the industry are still tough and unit construction remains dead-in-the-water.

"....the Cairns residential property market remains at the bottom of the property market cycle, but there is light at the end of the tunnel...."

One push factor for the market is that vacancy rates for rental property have lowered considerably over the past 12 months and are now extremely tight. According to our Cairns Rent Roll Survey, vacancy rates for houses have come down from a trend level of 4% in December 2010 to 2.2% in December 2011 and 1.3% in December 2012, while those for units have come down from 4.8% to 1.9% over the same period. In addition rents are climbing, rising by about $30 per week for houses and $15 per week for units over the past two years. Tight rental market conditions, rising rents and affordable property prices are providing the right pre-conditions for the market to gradually regain some momentum during the next 12 months.

Click here to download Herron Todd White's national report for January 2013

Peter Musso licensed real estate agent at Ray White Smithfield selling property in Cairns' beautiful northern beach suburbs including Trinity Beach, Kewarra Beach, Clifton Beach, Palm Cove, Trinity Park, Smithfield, Yorkeys Knob, Holloways Beach, Machans Beach, Caravonica, Kamerunga and surrounds.

The Cairns Post - "North a National Hotspot"

The Far North has become one of Australia's buyers' market hotspots, with potential home-owners having the upper hand when buying property.

According to the latest Commonwealth Bank/RP Data Home Buyers Index (click here to view RP Data's latest press release), the region has been listed in the top five buyers' markets in Australia.

The report revealed that regions where sellers held the least leverage and buyers were empowered tended to be primarily coastal or lifestyle markets, where housing conditions have been relatively weak.

Herron Todd White Cairns director Rick Carr said buyer activity in the region had fallen away since the onset of the global financial crisis.

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"We still maintain Cairns is a buyers' market," he said.

"There are more properties on the market than there is demand. The market power is with the buyer."

The economic researcher said prices had declined over the past couple of years, but the cost of finance and affordability were finally lining up.

"The market is at or close to the bottom of the price cycle but that's a forecast, not a guarantee.

"The cost of finance is much better and there is better affordability, the economy is starting to pick up."

Ray White Cairns Central sales agent Therese Plath believes buyers are aware they have the advantage.

"I do believe the buyers are active out there, and certainly in the valid price range.

"We did a contract (on Wednesday) for a couple (buying) in the lower $300,000s range. Because the interest rates are attractive at the moment and the prices are attractive - it's never been a better time for them."

RP Data's senior research analyst Cameron Kusher said plenty of stock and a low number of buyers mean it is an ideal time for property hunters to hone their negotiation skills.

"In recent months there's been a bit of an uptick in people actively looking, but on a historical basis the amount of stock for sale is quite high," he said.

“While those conditions persist, you're typically going to have a market where buyers are better positioned to negotiate than sellers.”

Conditions are currently tipped in favour of buyers in all states and territories except the ACT, although there are still significant differences between states and cities.

Queensland and Tasmania show extreme buyers' market conditions, while parts of southwestern and inner Sydney are more evenly balanced.

Mr Kusher said low growth in house prices over the last decade meant many potential buyers had opted to boost their savings or pay down debt rather than upsize their homes.

“Any little growth (in house prices) is not going to bother people, because they're just saving for a bigger deposit.

“People are realising they have probably leveraged up on debt a little bit too much in the last decade, and they're now trying to get themselves into more comfortable positions.”

The top five buyers' markets are Southern (TAS), Lower great southern (WA), West Moreton (QLD), Wide Bay Burnett (QLD) and Far North (QLD).

Article printed by The Cairns Post Property Guide- 26th January 2013

Peter Musso licensed real estate agent at Ray White Smithfield selling property in Cairns' beautiful northern beach suburbs including Trinity Beach, Kewarra Beach, Clifton Beach, Palm Cove, Trinity Park, Smithfield, Yorkeys Knob, Holloways Beach, Machans Beach, Caravonica, Kamerunga and surrounds.

32 Hectare Business & Industrial Park Approved

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A SPRAWLING business and industrial park will soon rise from a cane paddock at Edmonton after a local third-generation farming family won their four-year legal battle over the plans. 

Pregno Family Investments has been tied up in the Cairns Planning and Environment Court since March 2009, appealing against the council's rejection of their proposed 32.2ha development.

But all seven development applications for the land along the southern corridor were finally given the green light by Judge Bill Everson last week and the Pregno group is now focused on the first stage of the development.

"It's a great relief," Pregno spokeswoman Meredith Gardiner said.

"It was very frustrating at times over the last four years."

“But now the council is working with us and it’s exactly what Cairns needs,” she said.

The Edmonton Busienss and Industry Park will occupy a 212ha cane farm east of the Bruce Highway at Edmonton. It is the biggest proposed Greenfield development in Queensland outside of the southeast.

Pregno expects about 4000 jobs to be created during the project and the tendering process will favour local contractors, Ms Gardiner said.

It will be built in six stages over about 20 years, eventually including a 250-bed hospital, several showrooms, business and technology parks, a homemaker centre and tavern, and district-level sporting fields.

The plans also dedicate 42ha along Blackfellow Creek to community and recreational uses such as barbeques and parklands.

Works permits for the first stage of construction could be granted as soon as June and a start by August.

Ms Gardiner said interest from prospective tenants was promising, and the project would complement other huge developments in the pipeline south of Cairns such as the Edmonton Town Centre, to be built on Mann Farm. The area’s councillor, John Schilling, believes the Edmonton Business and Industry Park will meet the growing needs of businesses in the area, which is tipped for a population boom during the coming decades.

“Edmonton is a fast-growing suburb and the demand for improved business and community facilities is increasing,” Cr Schilling said.

“It has been a long process but the end result will be beneficial for, especially the residents.”

Article printed by The Cairns Post - 4th February 2013

Peter Musso licensed real estate agent at Ray White Smithfield selling property in Cairns' beautiful northern beach suburbs including Trinity Beach, Kewarra Beach, Clifton Beach, Palm Cove, Trinity Park, Smithfield, Yorkeys Knob, Holloways Beach, Machans Beach, Caravonica, Kamerunga and surrounds.

Launching some extra Magic in Cairns

Not a news item specifically relevant to property markets however I felt it important to note the general improvement in business confidence currently experienced within the tourism industry in the Far North...

AN experienced Great Barrier Reef operator today launches a new $3.5 million catamaran on the back of an imminent turnaround in tourism.

Director Tim North (front) and marketing manager Jeff
Cameron-Smith show off their new vessel.

Tim North of Reef Magic Cruises said there was "a feel-good factor" in Cairns.

He said he planned months ago to buy and refurbish the 32m vesselbecause he knew the good times were returning.

"The Cairns economy is picking up, tourism is picking up," Mr North said. "When tourism is going right you have to be ready for it, not when it arrives."

Mr North said he had "a gut feeling" that the industry was on the rebound so refinanced and borrowed money to expand.

"I believe we now have the two best 30m cats in Cairns."

Mr North, who has 30 years' experience on the Reef and has owned Reef Magic Cruises for 16 years, said Reef Magic III would be used primarily for daily Reef trips while the existing Reef Magic II would be for charters.

He said charters provided a growth area. The boat was surveyed to travel 320km off the coast and anywhere in Australia. Charters included weddings, conferences, cruise ship transfers and film shoots.

"I've got a feeling I'll be doing four or five charters a week," Mr North said.

"We did 30 cruise ship transfers last year and we do quite bit of film shooting, such as Sea Patrol.

"...We're on the up, now's the time to move..."

"I've had an inquiry for an 18-week film shoot. We're on the up, now's the time to move."

Reef Magic III was previously Fantasea Wonder in the Whitsundays and has 350 seats split over three levels with a maximum daily loading of 200 passengers.

It is powered by two diesel engines generating 1107kW and cruises comfortably at up to 24 knots.

Direct from Cairns it will reach the company's Marine World outer Reef pontoon in under 90 minutes.

Reef Magic II was built in Brisbane in 2007 and cost $5.5m and will be completely re-powered with state of the art Caterpillar engines and the on-board layout, facilities and water access points modified to become a self-sufficient outer Reef day charter vessel.

Article printed by The Cairns Post - 30th January 2013

Peter Musso licensed real estate agent at Ray White Smithfield selling property in Cairns' beautiful northern beach suburbs including Trinity Beach, Kewarra Beach, Clifton Beach, Palm Cove, Trinity Park, Smithfield, Yorkeys Knob, Holloways Beach, Machans Beach, Caravonica, Kamerunga and surrounds.

The Cairns Post: Brighter Outlook Propels Far North

THE Far North's economy has had a great start to the year, the latest CairnsWatch report says.

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Report author Rick Carr of Herron Todd White said the economic recovery "gained further momentum over the last month with most key indicators showing accelerated improvement".

"All is not yet rosy in the economy, but the progress made has been significant," he said.

Mr Carr said there had been gains in the key areas of employment, airport passenger numbers and building approvals.

He said the number of people in jobs rose by 4900 in December to a record high of 145,200.

"This continued the strong run of employment growth that took place during 2012," Mr Carr said.

Passenger numbers through Cairns Airport's domestic terminal "continues to achieve record highs" while they were also rising at the international terminal boosted by new services from China, he said.

Click to download current and past 
CairnsWatch reports

Mr Carr said average tourist accommodation occupancy continued to rise during the latest quarter to reach 66.7 per cent in September 2012 compared with 63.1 per cent in September 2011 and average room rates improved to about $125 per night, and $155 at Port Douglas.

"Building approval numbers have recovered significantly during 2012, with a 38.6 per cent increase in the number of houses approved from January to November 2012 compared to the same period of 2011," he said.

Cairns Chamber of Commerce chief executive officer Deb Hancock said Cairns was on course for a successful 2013.

"The growth of 4900 jobs since November shows that general business confidence is growing," she said. 

"Business owners should look to the future with confidence given that there are a number of positive economic indicators all aligning to support a positive trajectory for 2013."

"Business owners should look to the future with confidence given that there are a number of positive economic indicators all aligning to support a positive trajectory for 2013."

Chamber of Commerce and Industry Queensland Far Northern chairman Brett Moller said the report allowed the business community to be "cautiously optimistic".

"While recent council and State Government announcements and commitments to reboot our economy are very welcomed we need investment from the private sector to sustain our economy and the environment to encourage that investment is slowly returning."

Article printed by The Cairns Weekend Post - 2nd February 2013

Peter Musso licensed real estate agent at Ray White Smithfield selling property in Cairns' beautiful northern beach suburbs including Trinity Beach, Kewarra Beach, Clifton Beach, Palm Cove, Trinity Park, Smithfield, Yorkeys Knob, Holloways Beach, Machans Beach, Caravonica, Kamerunga and surrounds.

Accommodation Occupancy Rates Best in Five Years

Throughout recent months I have had this statement affirmed to me by many local complex managers; all claiming to have had their best previous 12-month period since the GFC. I am told by most managers that since 2010 each year has shown a marked improvement in trend occupancy rates in turn positively influencing the nightly room rates achieved. This is welcomed news for many owners of holiday apartments who have been hit with a double-edged sword following the GFC with decreased returns and also increased expenses almost exclusively associated with rising strata-title insurance levies.

HOTELIERS in the Far North have had their best three months of occupancy rates in five years.

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The latest edition of the Tourism and Transport Forum-HOSTPLUS National Accommodation Barometer shows continuing strong demand for accommodation in Australia.

Forum chief executive John Lee said the industry was benefiting from the relatively strong Australian economy and popularity of short breaks.

“Demand for accommodation in our capitals, along with the Gold Coast and Cairns, is very strong at 81.3 per cent for the September quarter, on par with the same period in 2011,” he said.

“Pleasingly, Cairns saw an occupancy rate of 76.6 per cent for the quarter.

“Port Douglas saw very strong revenue per available room growth compared with the September 2011 quarter.”

Accor’s Cairns hotels finished last year with an average occupancy for its city hotels of 80.1 per cent, up more than 1 percentage point on 2011 and almost 9 percentage points ahead of the overall Cairns market.

A stand-out performed for the group was the Pullman Reef Hotel Casino, which achieved its highest occupancy on record, averaged 84 per cent for the year.

Pullman Reef Hotel Casino general manager Wayne Reynolds said the strength of occupancy last year augured well for this year.

“...We saw an increase in meetings and conferences, along with growth in domestic leisure and inbound business, particularly from China...”

“Pleasingly, we saw an increase in meetings and conferences, along with growth in domestic leisure and inbound business, particularly from China,” he said.

Article printed in The Cairns Post – 31st January 2013

Peter Musso licensed real estate agent at Ray White Smithfield selling property in Cairns' beautiful northern beach suburbs including Trinity Beach, Kewarra Beach, Clifton Beach, Palm Cove, Trinity Park, Smithfield, Yorkeys Knob, Holloways Beach, Machans Beach, Caravonica, Kamerunga and surrounds.

Building industry showing recovery

The construction industry is preparing for a much rosier year after the latest housing approval figures show a 25 per cent jump in the Far North.

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Builders say the figures show their sector is recovering following a prolonged slump that led to the collapse of major developers such as the Hedley Group, CEC and Glencorp.

Master Builders regional chairman Ron Bannah said: “There’s been pockets of really good work out there.

“It can only get better. I believe we started to see a turn around two to three months ago.

“Builders appear to be busy. Many are doing estimates and quotes.

“One builder told me on December 14 that he had seven contracts in the new year while another said he was not taking the three weeks off during Christmas and the New Year, that he was working through.”

In the 11 months to November last year there were 919 housing approvals, up 181 on the 738 in the previous period. In Cairns the figures were up 38.5 per cent, a 118 increase from 306 to 424. Approvals in Cairns in November last year were up 64 per cent from 31 to 48 compared to November, 2011 and in the Far North by 6 per cent from 66 to 70.

Local builders such as Steve Slatyer say the last few years have been tough for the industry, but the increase in building approvals spells good tidings.

“It’s been a tough few years. It’s been steady, but on the quiet side of steady, just ticking over,” he said.

“More building approvals are a good sign – it means confidence is returning.”

Mr Bannah said he tried to organise a bus to take builders to Townsville to inspect a cyclone testing station at James Cook University and of the 30 he contacted none were available because they were “flat strap”.

“We haven’t seen this for the past three to four years. I hope it’s going to start to ramp up and all the indicators are that it’s going to.

“It’s never been cheaper to build because the interest rates are so low.”

Herron Todd White Cairns research director Rick Carr said there were new houses being built but still not units.

He said the growing population and low rental vacancy rates were “encouraging people to build.”

Mr Carr said investors remained quiet and it was still cheaper to buy existing homes.

“Some people are opting to build. Twelve months ago I would have said not many. It’s not back to robust conditions but the balance is gradually tipping.”

Austart Homes owner Phil Matthews said he remained optimistic.

“It’s still pretty tough. Building will grow in the next 12 months but not double. We are a long way from what it used to be.

“There won’t be any parties this year. It will be a tough year and only the switched-on builders will roll along.”

He said dropping the water tank requirements would save buyers $7,000-$8,000 which would make a difference.

Article printed in The Cairns Post – 18^th January 2013

Peter Musso licensed real estate agent at Ray White Smithfield selling property in Cairns' beautiful northern beach suburbs including Trinity Beach, Kewarra Beach, Clifton Beach, Palm Cove, Trinity Park, Smithfield, Yorkeys Knob, Holloways Beach, Machans Beach, Caravonica, Kamerunga and surrounds.

Employment in the Far North reaches five-year high

It is generally accepted that employment is the best indicator of how an economy is performing, in turn affecting confidence within the local property market. With improved tourism conditions expected throughout the coming years as a result of growing international markets, Far North Queensland's trend employment rate, and in turn real estate market confidence, can be expected to continually strengthen.

THE Far North has hit a five-year workforce high, with 145,200 people in employment as a result of a bumper tourism season and a resurgent construction industry.

Nearly 5000 people more were hired last month compared with November and that figure was 8800 more than in December 2011.

Analysts say a vibrant tourism season, the new direct flights from China and more construction activity are behind the jump.

It follows a hearty November, when 2200 people left the dole queue and found work after 60,000 people flocked to the region for the solar eclipse.

Herron Todd White research director Rick Carr said the region's employment rose by 4900 in December to 145,200, the highest since the Australian Bureau of Statistics began breaking down regional labour figures in 2007. Included in the figures is Larissa Stremouchiw who has worked at the Salt House for the past month.

“This continued the strong run of employment growth that took place during 2012,” Mr Carr said.

“Far North Queensland bucked the statewide trend, where employment fell by 4300.” Mr Carr said unemployment increased from 8.1 per cent in November to 8.4 per cent as extra people started looking for work.

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“But the main news is the continuing jobs growth as a result of a much improved tourist season, the tourism boost from direct China flights and the building industry starting to stir again,” he said.

“Anecdotally I’m hearing that university graduates and school leavers are getting work straight away,” Mr Carr said.

He said this indicated that employers were confident about the economy and were hiring staff.

The next largest workforce recorded in the Far North was 142,800 in October 2008.

Tourism Tropical North Queensland sales and marketing director Brian Hennessy said the figures showed employment growth was closely related to tourism.

“The increase in employment comes on the back of strong growth in the domestic sector last year, the introduction of direct flights to China, the extra 60,000 visitors for the eclipse and a very buoyant Christmas and New Year holiday period,” he said.

Cairns Chamber of Commerce chief executive officer Debbie Hancock said the figures were “heartening news for the business leaders of Cairns.”

“Far North Queensland is no longer the highest unemployment region in Queensland. The growth of 4900 jobs since November shows that general business confidence is growing,” she said.

Member for Cairns Gavin King said with tourism on the up, the broader economy was now showing signs of confidence with good news emerging in a range of sectors, such as the automotive, home builders and marine industries.

“Recent examples include L.K. Motors, which quadrupled its turnover last year, and BSE Cairns Slipways growing its workforce from around 50 employees early in 2012 to more than 200 staff currently,” he said.

But Cairns-based Senator Jan McLucas warned that the region was now entering “a typically slower time of year for our local economy with the wet season keeping tourists away.”

“We do, however have Chinese New Year celebrations to look forward to which may help bolster this quieter time,” she said.

Tracy Carr, who graduated from James Cook University with degrees in law and business last year, obtained a job with Preston Law two months ago.

“I was quite surprised to get a job so quickly after graduating,” she said.

The 23-year old, said she was looking forward to a 12-month traineeship before being admitted as a solicitor.

Article printed in The Cairns Post – 25^th January 2013

Peter Musso licensed real estate agent at Ray White Smithfield selling property in Cairns' beautiful northern beach suburbs including Trinity Beach, Kewarra Beach, Clifton Beach, Palm Cove, Trinity Park, Smithfield, Yorkeys Knob, Holloways Beach, Machans Beach, Caravonica, Kamerunga and surrounds.