Cairns Post: Bungalow Tops List for Rental Returns

BUNGALOW has topped the list for the highest rental yields for units in the Far North.

According to RP Data figures, released this month, Bungalow in Cairns, recorded a 7.7 per cent gross rental yield in the past year.

Properties at Manoora and Cooktown outperformed the rest in the housing market revealing an average rental yield of 6.2 per cent.

LJ Hooker Edge Hill property manager Amanda Boccalatte said she was initially surprised Bungalow recorded the highest return but narrowed it down to the large number of units in the suburb.

"Sale prices are low but the rents haven't dropped," she said.

"You could buy a unit (at Bungalow) in 1998 for low to mid-$200,000s and you would be getting $220-$240 in rent (weekly)."

Ms Boccalatte said unit sale prices were now $50,000 to $100,000 less but rents were still the same.

With two-bedroom units in demand, Ms Boccalatte believed it was a good time for investors to enter the market.
"It's a great time to invest, prices are low and you are getting a great return," she said.

"Body corporate fees are high but really when you look at the rental return (7.7 per cent), you wouldn't have seen that for the last 10 years."

But Kylie Fullerton, of Taylor Jones Property, said it may not be the best time to rush out to buy a property based on positive rental yields.

While the rental market appeared to be tightening, she was wary to generalise because of a lack of consistency around statistics.

"The rental pool is shrinking," she said.

Ms Fullerton said while interest rates and property prices remained low, investors needed to factor in high insurance premiums and body corporate fees.

"There is a demand for four-bedroom houses with two bathrooms (and) we are finding people are wanting relatively new houses," she said.

Indicative gross rental yields are based on the average annual rent divided by the median sale price in each suburb in the past year.

THE TOP 10 RENTAL YIELDS

UNITS
Bungalow - 7.7 per cent
Woree - 7.2 per cent
Parramatta Park - 7.2 per cent
Port Douglas - 7.1 per cent
Edge Hill - 6.9 per cent
Yorkeys Knob - 6.6 per cent
Holloways Beach - 6.6 per cent
Mooroobool - 6.5 per cent
Westcourt - 6.5 per cent
Manoora - 6.4 per cent

HOUSES
Manoora - 6.2 per cent
Cooktown - 6.2 per cent
Caravonica - 6.1 per cent
Manunda - 5.9 per cent
East Innisfail - 5.9 per cent
Babinda - 5.8 per cent
Bungalow - 5.8 per cent
Cardwell - 5.7 per cent
Craiglie - 5.7 per cent
Westcourt - 5.6 per cent

Article printed by The Cairns Post - 24th July 2012
Writer: Bianca Keegan

Peter Musso licensed real estate agent at Ray White Cairns Beaches 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 and surrounds.

Queensland Tourism Centres Post Healthy Growth

The RIEQ (Real Estate Institute of Queensland) has reported that Cairns was the second best performing region in Queensland for the March quarter behind the Fraser Coast noting a 4.5% increase in median house price.

REIQ Cairns zone chair Greg Clyde-Smith said the market was finally starting to see the re-emergence of confident buyers with up-graders at the prestige end of the market showing dominance.

The REIQ Market Monitor report for the March quarter will be published in early June to reflect such positive figures… speaking with buyers on the ground there is a certain improvement in market sentiment though it will be interesting to see whether the Tourism centres such as Cairns and the Fraser Coast will be able to maintain positive figures over other major centres throughout the remainder of 2012... stay tuned!

Tourism centres post healthy growth

REIQ Insider Blog – May 21^st 2012

The REIQ March quarter median house price report has found the top performer of all major regions across the State to be Fraser Coast, which posted median house price growth of 7.8 per cent to $290,000 over the March quarter. The numbers of preliminary house sales were also up an impressive 42 per cent. Local REIQ agents say the region had benefited from a busy Christmas period as well as an increase in buyers prepared to buy due to the affordability of property in the area.

REIQ Fraser Coast zone chair Linda Bland said the March quarter has been characterised by a slight increase of sales in the $500,000-plus bracket.

“We have experienced additional demand in the upgrader market, which is predominantly coming from owner-occupiers,” she said.

“This can mainly be attributed to the softening of prices that has occurred at the upper-end of the market over recent years which is attracting buyers looking for excellent value for money.”

Buyers were generally still looking for the best opportunities available, she said, which many remaining price conscious.

“We are also starting to experience some increasing levels of confidence with many people starting to believe that the worst of the economic conditions could be behind us,” she said.

Maryborough performed well over the March quarter with its median house price increasing 3.4 per cent to $212,000 over the period.

A solid performer over the year ending March was Scarness which posted median price growth of 5 per cent to $308,750.

The second best performer over the March quarter was Cairns, which recorded median house price growth of 4.5 per cent to $350,000. Local agents say the region now represented excellent value with demand increasing, especially in the upper end of the market.

REIQ Cairns zone chair Greg Clyde-Smith said the market was finally starting to see the re-emergence of confident buyers – however over the March quarter, it was the up-graders at the prestige end of the market that were the most dominant.

“Sales in the $500,000-plus bracket were up compared to the previous quarter, while the affordable end languished somewhat,” he said.

“Access to finance from banks is behind the shift, with banks appearing to prefer clients with greater equity and serviceability, while loan applications at the affordable end are falling over on bank valuations.

“As a result, first home buyers are struggling to get their foot in the door. And while investors are only just re-emerging, it is a marked improvement from 12 months ago when there was none at all.”

Mr Clyde-Smith said he expected property prices to remain stable for the foreseeable future, while sales activity should gradually return to healthier levels.

“All of this does however hang on the need for further interest rate cuts – without which the wind will be taken out of property market sails once again,” he said.

“A more favourable Australian dollar will also provide further stimulus for the Cairns tourism industry and, in turn, the economy and property markets.”

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Peter Musso licensed real estate agent at Ray White Cairns Beaches 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 and surrounds.

No End in Sight for Tightening Rental Home Market

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As well predicted, the availability of rental homes throughout the region is becoming an increasing concern for prospective tenants. The Cairns Post today reported another decrease in the vacancy rate with an increase in median rents and the key economic indicators are clearly telling us that this trend will continue throughout 2012.

Building approvals in the construction industry remain at an alarmingly low rate; certainly not enough to accommodate the continually growing local population. Almost every day it seems as though I am hearing from prospective tenants who are finding it increasingly difficult to find suitable rental homes.

One must ask with median rents expected to rise substantially throughout the year and fewer rental homes available; will prospective tenants shift their sights toward the deflated sales environment currently offering an attractively wide range of opportunity?

Cairns Rental Houses in High Demand

The Cairns Weekend Post - 11th February 2012

PEOPLE hunting for a house to rent could be facing longer waits as vacancy rates in Cairns continue to tighten.

The latest Real Estate Institute of Queensland report says Cairns’ vacancy rate dropped from 3.1 per cent in the September quarter to 2.8 per cent in the December quarter.
The median weekly rents for two bedroom units and three bedroom houses recorded an increase of $5 or $10 over the quarter.

Despite a "slight" unit oversupply, demand for houses is strong with many agents beginning to exceed supply.

TNQ Rentals owner Karin Riley said her agency only had two vacant houses out of more than 450 properties on the books.

"Houses are doing extremely well and tenants seem to prefer a house over a unit at the moment," Ms Riley told The Weekend Post.

"The unit market is suffering a little but in saying that if the property is well presented, fresh and modern, they’re attracting people."

The latest Australian Bureau of Statistics housing finance figures found the number of investors in Queensland increased by more than 16 per cent over the month but the report could not provide a regional breakdown.

This return to investor activity, while still slightly below average, is also being driven by the lower interest rate environment that is now in play, REIQ CEO Anton Kardash said.

"After being in hibernation for most of 2011, investors are starting to return to the market with REIQ accredited agencies also reporting a more buoyant mood since about November," he said.

"These tentative signs of recovery, however, can only be sustained if confidence levels continue to improve. The key to this is having an interest rate regime that reflects and supports the economic reality of the majority of businesses in Australia."

Peter Musso licensed real estate agent at Ray White Cairns Beaches 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 and surrounds.

The Best Performing Suburbs in Cairns

Article printed in The Cairns Weekend Post Saturday 15th October 2011

The data's in on our best performing areas: Cairns real estate agents see a glimmer of hope that the property market slump could be turning a corner. 

Latest RP Data figures offer pockets of optimism among the backdrop of doom and gloom. The numbers don’t lie.

Sales of houses in Mooroobool have seen a 21 per cent increase in median price for the quarter to July 2011. Another standout suburb, Trinity Beach, has seen the median price for a house settle at $375,000 for the same time period. And fashionable Edge Hill continues to perform well with a positive 3.6 per cent quarterly change, taking its median price to $445,000.

Ray White Cairns Beaches principal Paul Stirling, who like many Cairns agents, supplies his sales figures to RP Data – the real estate industry watermark – said an increase in strong sale figures, compared with this time last year, provided a confident platform for the industry.

"Our volume of sales per month has increased compared to the first six months of the year," Mr Stirling told The Weekend Post.

"We were averaging 13 sales a month and now we’re averaging 16 sales a month and 50 per cent of our sales market has been shared at Trinity Beach. Our core suburbs at the moment are, obviously Trinity Beach, Kewarra and Clifton beaches, Palm Cove, Trinity Park and Smithfield.

"Rents are rising. Just this week we had a five-bedroom house at Kewarra Beach, which vacated and was renting for $440 a week, and we’ve since got new tenants in and they’re paying $460 a week. So we’re seeing a $20 rise in some rental properties.

"With rents rising, this is stabilising the market and it’s having a positive effect on house values.

"We’re getting a large number of inquiries from the medical profession coming through as the Cairns Base Hospital starts to fill more and more positions in line with the expansion. We’re also getting a lot of inquiries from the LNG project in PNG and a lot of these people are purchasing.

"I strongly believe we’ll definitely be over the worst, if we haven’t already passed it now, by this time next year. I can see a strong future ahead of us in the next 12 months, it’s certainly going to be a lot better."

Mr Stirling said he wasn’t surprised to discover the "much sought after" Trinity Beach was one of the top performing suburbs with 89 houses sold in 12 months to July 2011.

"Trinity Beach also includes the Bluewater precinct, which is offering great house and land packages, but the general Trinity Beach area is a popular well-serviced area, which makes it extremely appealing to the family market," he said.

Cairns Property Office principal Greg Moule said "attractive prices" were drawing buyers to city fringe suburbs such as Mooroobool and Brinsmead.

"There is no doubt that there’s attractive buying out there and we’ve seen houses in the Mooroobool and Manunda areas selling in the high 200s," he said.

"They may be old but because it’s so close to the city, and a lot of families are now down to one car and they want to save on as much as they can in tough times, these areas make very attractive buying."

RP Data is the No. 1 provider of property information and analytics in Australia. Cairns real estate agents are not obligated to contribute their sales figures to RP Data.

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Peter Musso - Ray White Cairns Beaches - Property agent selling real estate in Trinity Beach, Kewarra Beach, Clifton Beach, Palm Cove, Trinity Park, Smithfield, Yorkeys Knob, Holloways Beach, Machans Beach

Investor Optimism Growing

An increase in university enrolments and speculation over Cairns' role in the Papua New Guinean gas project is fuelling new optimism in the housing market.

While the Real Estate Institute of Queensland's March 2010 quarter report showed the median house price in Cairns fell by 0.7 per cent to $370,000, there was cause for optimism, REIQ Cairns chairman Rick Szelpuk said.

"A lot of people will move to Cairns looking to rent property initially. Also, with the Australian dollar getting more realistic, it allows opportunity for tourists to visit and Cairns can benefit from this."

Mr Szelpuk said the 30 per cent increase in mid-year enrolments at James Cook University was another positive sign. He said it was a good time for investors to buy property to rent out to university students.

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Peter Musso - Ray White Cairns Beaches - Property agent selling real estate in Trinity Beach, Kewarra Beach, Clifton Beach, Palm Cove, Trinity Park, Smithfield, Yorkeys Knob, Holloways Beach, Machans Beach