Property Investment in Cairns - David Forrest

So, let us look at the historical rent income in Cairns over the last few years.

This information along with the other graphs I will use are all from the Herron Todd White Cairns Watch we publish on our website. As you can see almost all classes have shown long term rent increases except for two-bedroom flats. We believe this sector has shown good increases up until March 2020 when furnished units were heavily hit by the effect of COVID-19 shut down. It is hard to understand why the same did not apply to one-bedroom units.

This would indicate an underlying issue with two-bedroom flats.

The obvious question is “why are we seeing this sort of rent growth”?

There are several factors working to generate this, long term population growth, limited delivery of new stock, growing regional economy, shrinking pool of long-term rental accommodation due to Airbnb taking property out of pool, less investors in the market and existing owners selling to mostly owner occupiers.

All these factors have created low vacancy rates forcing the rental increases. The graph below shows the movement of local vacancy rates.

Capital growth has not been Cairns strong suit over the past ten years as you can see from the graph below, but we believe that we are seeing a strong resurgence in the market and as you can see from the graph of sales volume, we are definitely seeing a much more active market place.

The bright side of this is that rental return has obviously increased over the past ten or so years.

I mentioned forced saving at the beginning of this article, and it should not be underestimated. Many use the discipline of having to pay a mortgage as a long-term savings plan, but this is a personal thing and not something we can monitor.

There is much we can talk about and I would love to help you in your journey as a property investor. I have been a property investor for many years and have been in the real estate industry from 1980 if you would like a chat please do not hesitate to contact me on 0418 897 640 or click here to email me!