Revealed: Cairns’ Top 10 most undervalued suburbs

The most undervalued suburbs in Cairns have been revealed, with price rises of as much as $67,000 yet to come in the current housing cycle.

The most undervalued suburbs in Cairns have been revealed, with price rises of as much as $67,000 yet to come in the current housing cycle.

Shock analysis by Suburb Data co-founder Jeremy Sheppard found that despite enduring some of the biggest price spikes in recent history, Cairns still has areas where prices have significant room to rise. Cairns’ overall rank was 48/100 which means it is now considered a balanced market with supply picking up slightly over demand – making its undervalued suburbs stand out even more.

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Cairns has seen strong growth since the pandemic but there are still suburbs with more price rises ahead in the current housing cycle.

Mr Sheppard said the ripple effect of dozens of factors including nearby growth rates and price rises meant houses were still undervalued across many Cairns suburbs, with Holloways Beach topping his top 10 on a median of $509,000, with the highest demand-supply ratio plus (DSR+) rating 67 out of 100.

It is currently priced about $36,000 below surrounding suburbs with about 19 per cent growth to go to match neighbours, he found.

Mr Sheppard said a DSR+ of 50 was a balanced suburb, with those above the 65 mark seeing demand outstrip available supply – which made them highly desired by investors wanting strong capital growth.

High demand and low supply was the ideal for investors, meaning prices were still expected to see strong growth, he said.

Also ranked among Cairns’ most undervalued suburbs was Kewarra which is priced $39,000 below neighbours with a median of $622,000, but has significant growth to go given its DSR+ rating was currently sitting at 63 out of 100.

Westcourt was also undervalued, Mr Sheppard found, with a median of $529,000 and a DSR+ rating of 59 out of 100. It is still priced $41,000 below its neighbours, despite seeing strong growth rates.

Other suburbs DSR rates in the 50s were Manunda (59/100) where the median house price was $498k – a massive $67,000 less than neighbouring areas – and Earlville which is priced higher at $611,000, which is $2,000 more than its neighbours but seeing strong demand at 58 out of 100 DSR+ rating.

The other top 10 most undervalued areas in Cairns region included Bayview Heights (which made the cut despite being $4,000 more than neighbours, given it was rated 57/100 with demand outpacing supply).

Cairns has strong allure due to being the gateway to the Great Barrier Reef and tourism opportunities. Picture: Brendan Radke.

Mount Sheridan with a median price of $598,000 was $2,000 below neighbours and rated 54/100, while Edge Hill was eighth most undervalued with its median of $697,000 sitting $6,000 above nearby suburbs, but demand seeing it rated 53 out of 100.

Machans Beach was $50,000 below neighbouring suburbs, with its median of $444,000 and DSR+ rating of 52 out of 100, while Trinity Beach also made the top 10 list with its median at $738,000 being $5,000 below neighbours – despite falling just below the balanced market line with DSR+ of 49 out of 100.

Mr Sheppard said undervalued suburbs would generally outperform their city’s average growth rate.

“So buyers of property in the top (10) should expect performance above the average for that city,” he said.

Place chief auctioneer Peter Burgin said some suburbs definitely have some catching up to do. Picture: Liam Kidston

Place Estate Agents chief auctioneer Peter Burgin, who has over 40 auctions coming up next Friday, Saturday and Sunday as part of the One Winter Day campaign, said “some of those suburbs do definitely feel like they’ve got a bit of catching up to do”.

He said sellers simply wanted to understand what a fair price was in the market.

“Sellers have got great faith in the market that it will deliver a fair outcome for their home. Most also recognise that they’re selling and buying in the same market. I think everyone feels that no matter what’s happening in the market at the moment, property prices are going to get more expensive in Brisbane so they’re trying to make long term decisions now.”

“There is less stock on the market than some buyers would like and that’s also supporting values and outcomes.”

Ray White managing director Dan White said parts of Queensland are growing at a dramatically higher rate than historical trends.

Ray White managing director Dan White – who is leading a Queensland property panel on Sunday to celebrate the Group’s 100 years of operation in Brisbane with REA Group CEO Owen Wilson, Consolidated Properties Don O’Rorke and REIQ CEO Antonia Mercorella – said in the last three years South East Queensland consistently outperformed all major urban areas bar Perth.

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He said Neoval data showed SEQ houses and units grew 9 to 12 per cent and 10 to 11 per cent respectively – a massive rise since the pandemic.

“The last three (to four) years have seen a change in a relatively long standing historical trend – SEQ growth previously tracked with or underperformed the rest of Australia, it’s now growing at a dramatically higher rate.”

“These are bridesmaid suburbs across SEQ that have underperformed compared to nearby higher growth areas.”

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Originally published as Revealed: Cairns’ Top 10 most undervalued suburbs