Mortgage savings not whole story

INSURANCE and electricity costs appear to be chewing up savings made by new mortgage holders in Cairns.

Cairns mortgage expert Roger Ward said growth in the property market driven by investors and new home buyers had been offset by costs not associated with properties in southern areas.

He said tradesmen from mining areas had been settling in Cairns for steady work and investors older than 45 had been selling their properties in Victoria and NSW, and buying in Cairns and Port Douglas.

A higher-than-average number of high-end properties were sold in Cairns last year, including apartments in Cairns Aquarius, Parkview on Grafton, 181 The Esplanade, Nautilus on the Esplanade and Harbour Lights.

“The CBD is improving. People are feeling more cosmopolitan and are enjoying apartment living in town,” Mr Ward said.

“All you have to do is walk through Rusty’s Markets and you can see it is cheaper to live here.”

However, property insurance, up to five times more expensive than in southern states such as NSW and Tasmania, has been eating up savings on mortgages.

Mr Ward said those on fixed or low incomes would suffer.

“Pensioners are asset rich but cash poor,” he said.

Energy costs, especially in the Far Northern summer, were also expected to take new mortgage holders by surprise.

“In some respects life is cheaper up here,” Mr Ward said.

“But if you own your own home there are other costs associated with that.”

Queensland Electricity Users Network co-ordinator Jennifer Brownie said power bills were causing “palpable pain”.

“We really need to advocate ... for affordable electricity for households and especially businesses who are doing it tough,” Ms Brownie said.