The median house price in Cairns dropped 5.6 per cent to $346,000 over the June quarter however over the year ending June the median house price recorded a 0 per cent change.
According to local agents, the June quarter continued to be impacted by low consumer confidence which was compounded by the poor tourism sector and the high Australian dollar.
The announcement that the principal place of residence concession on stamp duty would be removed from 1 August had also not stimulated the market in any meaningful way before that date.
Agents say the majority of people are just not in a position to buy because either they can’t secure finance; they aren’t confident about their jobs or the economy; or they would have to take too much of a financial hit if they sold their existing property now to buy something else.
They say confidence levels need to drastically improve and the Aussie dollar needs to stabilise before the market picks up in any meaningful way in Cairns.
Over the year ending June, Freshwater recorded median house price growth of 13.5 per cent to $499,500, but this was partly due to the varying quality of stock sold over the period.
Nestled between rolling hills, a national park and a conservation park, Freshwater is a quiet, leafy suburb, which is popular with families.
The area is well serviced by transport infrastructure – Cairns Airport is only 5km away and Freshwater Connection train station, which ferries tourists along the Kuranda Scenic Railway, is centrally located.
The median unit and townhouse price in Cairns decreased 2.4 per cent to $225,000 over the June quarter. There has been significant softening in prices of units and townhouses in Cairns with reports of units selling for close to their purchase price off-the-plan from the 1990s.
This coupled with a shift towards more affordably priced units has contributed to the reduction in median sale price over the quarter and the last financial year.
The new Majestic Palms complex at Yorkeys Knob however continued to tick over more sales. Popular with interstate investors, the complex adjoins the Half Moon Bay Golf Course and is close proximity to all amenities.
Vacant Land Market
The median price of land decreased 5.9 per cent to $168,500 over the June quarter. Local agents don’t anticipate that the Queensland Building Boost will gain much traction in the region given the general softness of the sales market would make it difficult for second and third home owners to sell their existing property to upgrade to a new home.
New house and land packages also generally remain out of the financial reach of first home buyers.
Rental Market
The median rent in Cairns for a two-bedroom unit remained steady at $250 per week between June 2011 and June 2010. The median rent for a three-bedroom house increased $10 to $310 per week over the same period.
The residential rental vacancy rate in Cairns remained steady in June, decreasing to 3.7 per cent from 3.8 per cent in March.
Local property managers say vacancies are taking about two to four weeks to relet with about two to five applications per vacancy.
Information sourced from the Real Estate Institute of Queensland Market Monitor report for the June Quarter 2011 (Issue 11).
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