2010 Predictions for Cairns

Just wondering what people think about the prospects for Cairns in 2010. It has been a bit of a dismal year in 2009 in FNQ for IP's. Many businesses have closed and the renters have moved elsewhere for work. Not a good year for getting tenants.

So those that had to --sold. Those that hung on did not see much in the way of capital growth. In some cases it was negative.

On the bright side...with such a dismal 2009, maybe 2010 will be better?
 
Sailor, I expect more of the same for Cairns. The problem Cairns has had for many years is the volatility of the tourism industry, as it forms a large part of its industry base.

Cairns turned its back on the sugar industry many years ago in favour of the tourist dollar, so the GFC is impacting the region in not dissimilar ways as the Bird Flu affected the region. Business in this sector would need to recover significantly in order to give confidence for growth in the sector, which in turn will bring the health of the industry base back, along with the tourists.

My 2 cents....
 
You guys have done it tough, (talking to the rellies up there).

I think though if you can, ride out the tough and things will turn. It is beyond a beautiful paradise. Longterm growth has happened, am thinking a global financial crisis does not a longterm season make, if that makes sense.

There is the Great Barrier Reef, one of the wonders of the world, Cairns being cosmopolitan city/gateway to everything up there, Port Douglas, Daintree + north of, inland beauty, Kuranda...islands, Great Barrier Reef gets another mention because I can.

It's everything.

It is tourism based, but if folks can ride it out, maybe toss in um, something? (gym membership?/diving/sailing tuition?:)) with a lease of 12 months, entice tenant away from something, rent at a 12 month lower is better than nothing thing...advertise, I'll talk to my hospital working rellies see if they know anyone with good credentials wanting a rental...

Australian tourism did get hit hard, but know that it (Australia) especially the GBR is on many lips....and list to visit.
 
There is very much improved mood. How long this takes to translate to vacancy rates I am not sure. Some projects coming up so may have seen the bottom now. Plus new flights. So can't see it getting any worse. Rudd and Abbot have both visited to see what investment is required and the new flights announced. Unemployment back under 10%. Probably will stabalise for a while. Is a beautiful area but does have a internationally driven rather than local economy.
 
You guys have done it tough, (talking to the rellies up there).

Australian tourism did get hit hard, but know that it (Australia) especially the GBR is on many lips....and list to visit.

I think Townsville is far better off than Cairns in the short and medium term.

Cairns has always been far too dependent on tourism. Townsville is far more balanced.

I have recently purchased again in Townsville and will do so again if the deal stacks up.
 
yes Townsville more stable. More lifestyle pull for Cairns but once up here many find it hard to find long term work. Very project driven outside of tourism. However this is good for rentals during the transient times as even people on good wages may rent before committment. So can be good rental market with dramatically spurty gc every now and then. However not there yet but can see the light at the end of the tunnel. May be clearer come February/March.
 
I've emailed an estate agent twice regarding a property for sale in Cairns & they haven't been bothered to even respond. I would have thought in the current property climate, they would want to follow up every lead for the possibility of a sale, but aparently not.
 
I think Townsville is far better off than Cairns in the short and medium term.
It is looking a bit brighter than it was six months ago. :)

Just something for possible investors: Aitkenvale is starting to look like the new Garbutt to me. Stockland is a disgrace and the strip shopping is unattractive. Generally property values seem to be falling behind, except for the 1012 sm development blocks which have done well.

Could be good for a genuine long term investor though because rental demand will always be high. But owner/occupiers prefer some of the "nicer" suburbs without the proliferation of "six pack" housing and the social proplems which come with that.
 
This is a fairly recent news article with Michael Matusik's opinion:

http://www.cairns.com.au/article/2009/10/24/71511_real-estate.html

And when I emailed a PM about a property in Freshwater, this was part of the rely:

"I think the closer to the city the more demand but in general there is more demand for properties from Earville to cairns north and west to Redlynch - properties rent well all over but can depend on price and condition."

Problem suburbs generally start with the letter M. Southern suburbs can actually have quicker access to town via Ray Jones Drive. Forest Gardens etc can be very pleasant.
 
Sailor

I agree, I had terrible problems letting my Yorkeys Knob townhouse, in the end I had to drop the rent by $50 and accept a short term lease.

My Commercial office had a 3 year lease on it but the tenants were large builders and have grown so much they have moved into larger premises. I have a break-lease tenant until the lease expires.

The high dollar and the Jetstar cancellation of flights to Japan have impacted heavily. Also the floods were highlighted down south as was the dengue fever. Cairns and Port Douglas need to push the milder weather down south. In the past it was always come to FNQ to get warm but now that we are cooking down here it would be a good idea to push the cooler, wetter areas :D

I am hoping that the new flights the government are pushing is a positive for Cairns.

On the bright side, now is a perfect time to purchase as properties are the lowest I have seen them for some time.

Chris
 
Chrispy:
On the bright side, now is a perfect time to purchase as properties are the lowest I have seen them for some time.

I thought this as soon as I saw the thread....opportunity, BUT and it's a big but, I do need renters, talking to rellies tonight 230 families have left Cairns in the last 2 weeks.

Plus I'm building my brains out in Vic.

But I had it cross my mind more than once Chrispy.:cool:

Then reality spoke...

I hope Cairns and FNQ gets it mojo back. It's so beautiful.
 
Maybe all your positive thinking has paid off. Just got a call from the RE last night. They've got a tenant for my 8-month vacant unit. On the down side, he is the guy that rents another unit of mine in the same block.:eek: So now I have to find another tenant.
 
Regarding the 'M' suburbs in Cairns I can't say that I'm a real fan of these suburbs, but I don't believe they are entirely bad news. I think there are others here who have more closely followed the capital growth patterns in Cairns, but I think the 'M' suburbs have in recent times shown better growth than some of the other more popular suburbs. Of course, you need to, like anywhere else, be careful with the specific location. I think there are also opportunities for +ve cash flow in these suburbs. I remember reading an article (hotspotting, I think - tried searching on the net but couldn't find it..) that highlighted the studio apartments around Raintrees shopping centre for their cheap listed prices and their respectively high rental yields.
 
I remember reading an article (hotspotting, I think - tried searching on the net but couldn't find it..) that highlighted the studio apartments around Raintrees shopping centre for their cheap listed prices and their respectively high rental yields.

Yes, they are cheap and were originally on the market over 10 years ago when first built for around $60K, so the CG has not been that great. The area can be a bit seedy, and I noticed the police have increased their presence there, due to the higher crime rate. There are also many housing commision places in and around that area.
 
You got that right...now way will I be paying it, as the tenant approached them when they were looking at the unit.

I phoned him yesterday, and they have dropped the idea of claiming the first week's rent. It took a bit of talking on my part, but they were nice.
 
Long term I would be concerned about Cairns due to the reef dying.
It has already suffered degradation. Without the reef there are not huge reasons to go there (as you know because in the GFC noone had money for holidays and not many people went there).

Cairns is also hot now and will be even hotter with global warming. I think it is too hot to be a lifestyle choice for too many people. The gold coast or sunshine coast is more of a lifestyle choice as not as extreme heat.

So in the long term my advice is get your money out and put it in brisbane, melbourne, perth or even darwin.

Or even townsville is better even though townsville is uglier because townsville has lots of military and mining.
 
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