Brief Summary
This video features a discussion about the property market in Cairns, Australia, with insights from JD and Mika from Can's Property Office Rentals. The discussion covers Cairns' history, its current rental and property market dynamics, infrastructure, economic outlook, and future prospects. Key points include:
- Cairns is catching up to the rest of the market after a period of stagnation.
- Healthcare is a major employment sector, providing stable jobs.
- The rental market is still tight, with increasing rents, although not as rapidly as before.
- Gordonvale is identified as a growth area with new developments and facilities.
- Locals feel that Cairns is a great place to invest in and live in.
Introduction
PK introduces JD and Mika from Can's Property Office Rentals to discuss the Cairns property market. He notes that Cairns was relatively flat for a decade before experiencing significant growth in the last few years. The episode aims to provide viewers with a holistic view of Cairns, covering the rental and property markets, infrastructure, and economic outlook, to help them decide if it's a suitable investment location.
History and Structural Shift in Cairns Economy
Mika explains that Cairns is catching up to the rest of the market, with COVID-19 having a minimal impact due to fewer restrictions. This led to an influx of people seeking a lifestyle change, drawn by the pools, palm trees, and relaxed atmosphere. The word spread, making Cairns an attractive place to live. PK notes that healthcare is now the largest employment sector in Cairns, providing stable, high-paying jobs, followed by accommodation, retail, and tourism.
Rental Market and Tenant Profiles
Mika mentions that the rental market includes a mix of international workers fulfilling visa requirements, families, and professionals. JD adds that many professionals are moving to Cairns for a more relaxed lifestyle at a lower cost than in Sydney or Brisbane, particularly healthcare professionals. Unemployment is low, and while there's a cost of living crisis, Cairns offers something for everyone, with affordable rental options available alongside more expensive properties.
New Builds and Southern Corridor Growth
Mika notes that there are many new homes being built to meet the demand driven by the influx of people. The supply of houses couldn't keep up with the demand, leading to increased rental prices. Cutters Rise in Gordonvale is expanding with quarter-acre blocks, and despite locals considering it far, it's only a 30-minute drive to the city. The council is releasing land to accommodate developments, with growth seen in areas like Trinity Park and down south.
Gordonvale Development and Infrastructure
Mika says that Gordonvale is expected to show significant growth with a new shopping center and developments like Cutters Rise. Rents in the area are increasing, with new health facilities and aged care facilities planned. The drive from Trinity Beach is comparable to that from Gordonvale, making it accessible. PK notes the natural constraints on building in Cairns, with the ocean and mountains limiting expansion.
Demand and Future Land Release
Mika believes there is significant demand to continue absorbing land releases and construction in Gordonvale, as Cairns is catching up to the rest of the world. Infrastructure improvements are making areas more accessible. JD mentions an article about the need to upgrade infrastructure to accommodate growth, suggesting that expansion will continue southward towards areas like Goldsborough and Little Mulgrave.
Demographics of New Residents
JD says that the new residents are not typically retirees but rather young families. While retirees used to be a significant demographic, the current trend includes a broad mix of people. Cairns offers value for money and a desirable lifestyle.
Cyclone Risk and Building Standards
Mika explains that houses in Cairns are built to withstand cyclone risks. Locals generally don't take significant precautions unless it's a category five cyclone. Regular and preventative maintenance is encouraged. The impact of cyclones is often minimal, with only occasional fence damage or fallen trees. The infrastructure is well-prepared for flooding and cyclones.
Rental Market Trends
PK notes that the rental market was strong in 2023-2024 but has softened slightly in the last six months. Mika confirms that while the market is still tight and rents are increasing, the trajectory is not as steep as before. Properties are still being rented quickly to good quality tenants.
Rental Affordability and Arrears
JD says that tenants are aware they shouldn't be in arrears due to high demand, allowing landlords to be selective. Mika emphasizes the importance of quality property management and tenant education to maintain a low arrears rate.
Interstate Investing and Property Management
PK describes the process of interstate investing, where property managers conduct inspections and provide local knowledge. JD explains that establishing a relationship with investors before they buy is crucial. He assists interstate clients with appraisals and inspections to provide peace of mind, helping them understand fees, rental returns, and property conditions.
Investment Recommendations
JD recommends investing in Gordonvale, focusing on older properties and high-demand 3-bedroom, 1-bathroom units renting for $520-$560 per week. He advises against overly expensive properties and suggests spreading risk by buying two cheaper properties. Mika suggests focusing on the southern corridor, including Bentley Park, Edmonton, and Gordonvale, for a rural lifestyle close to the city. JD adds that new builds catering to contract doctors in Gordonvale could also be a niche market.
Exciting Developments in Cairns
Mika says that the lifestyle is the most exciting aspect of Cairns, offering a holiday feel every day. JD mentions a new Egyptian exhibition center opening near the aquarium as a significant tourist attraction. PK notes that Cairns is Queensland's fifth-largest city and is expected to grow, driven by Australia's aging population seeking a desirable lifestyle.
Final Thoughts and Contact Information
Mika emphasizes the importance of due diligence when choosing property managers and building a trusting relationship with them. PK discloses that he has no affiliation with CPO. JD offers a 10% discount on management fees for investors who mention seeing the video. The website for Can's Property Office is CPO.com.au, or they can be found by searching "Can's Property Office" on Google.
