Cairns December 2017

The month in review: Cairns

By Herron Todd White
December 2017

Conditions in the Cairns tourism industry are revitalising significantly from the tough conditions experienced in the aftermath of the GFC. The improvement in tourism conditions initially stimulated a revival of upgrades and extensions in the industry, particularly in the accommodation and reef vessel sectors. However 2017 saw the first new developments of significance take hold, with construction commencing on three new large hotels in the Cairns CBD. Concomitant with this, the Cairns region has seen a 7.7% uplift in employment during the past twelve months and its unemployment rate has declined to 5.6%.

You would think that these improvements would have produced a significant boost in local property market sentiment, but so far they haven’t. The overall level of residential sales activity has remained in a steady state throughout 2017 and Cairns can be best described as a static market. There has been steady demand for appropriately priced residential property, but overall, prices and volumes have been flat. Median trend prices for properties sold in the month of October 2017 came in at $405,000 for a house, $205,000 for a unit, and $212,000 for a block of land.

Pressures have been maintained in the rental market during 2017 as a result of tight rental vacancy rates. The trend rental vacancy rates for October 2017 stood at 1.8% for houses, 2% for units and 1.9% overall. The low rental vacancy rates have seen rents mildly increase, with the weighted average median rent increasing over the latest twelve months from $390 to $400 per week for houses and from $280 to $290 per week for units.