What's happening in the Cairns real estate market?
The Cairns real estate market is among many parts of Australia that have seen residential prices soar as people opt out of cities and hunt for homes in the regions.
Queensland has by far received the largest amount of interstate migration during COVID-19 as people abandoned southern states due to harsh lockdowns.
According to ABS data, Queensland received a net 40,600 increase in interstate arrivals in the year to September 2021. Our nearest rival was Western Australia with only a 6,050 increase in net arrivals. By comparison, NSW and Victoria saw net losses of 26,000 and 16,900 respectively.
Cairns real estate market enters a strong phaseSpeaking on The Property Brief podcast, REIQ Cairns Zone Chair Tom Quaid of Quaid Real Estate says the Cairns real estate market has entered its strongest period in 15 years.
"Cairns had a great boom leading up to the GFC (Global Financial Crisis)," Quaid says. "Unfortunately, post GFC we basically went off a cliff.
"Units halved in some cases, and house prices really didn't see much movement at all for the next decade. Quite often, if you were selling a house in 2017 that you bought in 2007, if you got your money back, you were happy."
Quaid says the region is experiencing its shortest ever time on market and he's witnessed houses selling for $100,000 more than they did 12 months ago, with percentage increases ranging from 10 to 30 percent.
Like many other areas of Australia, an influx of migrants and a lack of supply is driving up house prices in the Cairns real estate market.
And, like the rest of Queensland, these factors have contributed to an extremely tight rental market with Cairns posting a 0.7 percent vacancy rate in the December 2021 quarter.
Developers are playing catch upQuaid says the Cairns real estate market saw little development post GFC with no new apartment towers built in the Cairns CBD in the last decade, although some proposed developments have moved to the presale stage.
He says developers of new estates between 15 and 25 minutes from the city centre are having trouble keeping up with demand.
"We're now seeing developers playing catch up every time a new stage is released," Quaid says. "They're selling out within days where previously it might have taken months.
"Prices are rapidly moving there, but in the meantime, there's just not that supply to meet the demand."
Economy-wise, the Cairns CBD suffered when COVID-19 first prevented international visitors and then domestic visitors from arriving as borders closed. However, Quaid says green shoots are sprouting as visitors return to this premier tourism destination now borders are reopening.
The region has a strong agricultural base, particularly in sugar, and there's been a push to make the nearby Tablelands' produce more accessible to southern and international markets.
Listen to more from Tom Quaid and REIQ Townsville Zone Chair Ben Kingsberry as they discuss what's happening in the North Queensland residential property market on the REIQ Property Brief podcast.
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