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.
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.
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.
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