Cairns real estate: Investor influx could ease rental crisis

Rental vacancy rates remain at an all-time low across Cairns with intense pressure to secure a place but there’s one factor that may ease the crisis. HAVE YOUR SAY

THE rental market across Cairns remains tight with less than one per cent vacancy rates – but there is one factor that may ease the crisis.

An emerging trend of investors expanding property portfolios will put more homes into the available pool, Karl Latham of Twomey Schriber Property Group predicted.

Property investment in the Far North is a very attractive proposition compared with capital cities.

“We’ve seen a lot of investors buy in to take advantage of rental prices and low interest rates – we are seeing returns up here double or triple Sydney,” Mr Latham said.

“In Sydney you need a minimum of $1 million to get into the market and your return on investment is 1 per cent to 1.5 per cent compared with a 5 to 7 per cent return here,” he said.

A one-bedroom apartment at 1804/2-10 Greenslopes Street, Cairns North is for rent at $390 per week.

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“Investors seem to be expanding portfolios and we are seeing new investors – Cairns is on the hot spots map for investors.”

He said the residential tenancy vacancy rate in Cairns was about 0.5 per cent for houses and 0.7 per cent for units, but the number of applicants per property had dwindled slightly.

“We were getting 15 to 20 applications per property, now it is more like 10 to 15, it’s still a very competitive rental space,” Mr Latham said.

“It will be very competitive for the foreseeable future but a lot more investor buying will put more properties into the pool.

“It’s an excellent situation for investors but obviously hard for tenants.”

Mr Latham’s suggestion for those seeking rental properties was to get on to alert notifications for new properties with agencies and inquire immediately.

“Don’t delay for a few days, it could already be snapped up,” he said.

“Ensure you have a good application, good references.

“One of the difficult scenarios is when you have little furry friends, unfortunately investors prefer a tenant without a pet, which is very tough,” Mr Latham said.

“We have noticed a lot of the active tenants are purchasing rather than renting – it can actually be cheaper to own than it is to rent, with low interest and high rental prices, so a few tenants have gotten into the Australian dream of owning their own home – if they have got good, secure jobs.”

Leanne Munro and her husband Ben relocated from Brisbane to Cairns for work and although they own two properties, it was a challenging six weeks before they secured a rental.

“It was an ordeal, we were applying online but when you pull up to the property for the open house there’s 15 other people there.

“My husband has a job but hadn’t quite started, and being homeowners, we didn’t have a rental history, but they were able to check how we maintained our properties.

“It must be extremely difficult for people that don’t have properties.”

The couple stayed at Queens Court with their small dog while searching for a rental.

Anglicare released its rental affordability index last week, with executive director Kasy Chambers saying regional areas were no longer affordable.

“It seems that people flocked to regional areas when they had the opportunity to work flexibly, putting unprecedented pressure on regional housing markets,” she said

Have you had trouble finding a rental property in the Far North? Let us know your experience in the comments below or email [e-mail].

Originally published as Cairns real estate: Investor influx could ease rental crisis