CAIRNS UNITS RETURN BEST RENTAL YIELDS
Bargains are there, say industry experts, as price declines drive up percentage returns – but investors are unlikely to wait for costs to rise while other costs such as body corporate and rates need to be factored in
are based on gross yields which don’t take into account the costs of those properties such as body corporate, rates and the cost of finance,” he said.
“If you are looking to invest then it can take a lot more digging to find the right property.”
Conceding Cairns had not experienced rebounds of housing stock values compared to the other coastal centres such as the Gold Coast or Sunshine Coast, Mr Lawless said a national uptake in tourism would benefit the market.
“You have to expect the Cairns unit market is going to be a beneficiary of higher occupancy rates and more demand not just from tourists, but also from service workers who work in the tourism sector,” he said.
He also predicted the unit market could see further modest growth over the next 12 months. which has really driven the yield profile of that market which I think is going to become increasingly attractive for investors,” he said.
LJ Hooker Edge Hill principal Ross Moller agreed.
“The bargains have been here for a while but no-one’s really recognised it,” he said.
“If the press and publicity on this grows the prices will go up and the returns will drop so my advice is to get in now before the returns drop.
“We do need unit prices to go up though because until they go up we can’t build anything new.”
Quaid Real Estate owner Tom Quaid said apartments in the suburbs named in the report were entry level properties, but warned of hidden costs which could affect returns.
“It is worth keeping in mind that these figures UNITS in Cairns’ inner city suburbs have outperformed the nation in terms of rental yields.
Real estate research company CoreLogic’s Best of the Best 2016 report, released today, named Woree, Manunda, Bungalow, Manoora, Edge Hill, West Court, Earlville and Cairns North in a list of the top ten highest gross rental yields for units in Australia.
The only other entries were the suburbs of Elizabeth East and Davoren Park in the South Australian city of Playford.
Woree units posted the highest gross rental yields in the country at 8.7 per cent.
But CoreLogic head of research Tim Lawless said the high yields were a byproduct of steep falls in unit values.
“Rents haven’t fallen anywhere near as much
Residential sales consultant Rupert Hayden-Gilbert at City Water Apartments in Woree,