Magnetic Island hits botttom of the market

BEACH homes on a tropical island are on offer for less than their building costs, discounted by up to 70 per cent.

real estate

TROPICAL paradise is selling for a pittance on a North Queensland island where beach pads are on offer for less than their building costs.

Palm-lined Magnetic Island has hit the bottom of its market, according to local agents, with prices making it never better to bag a holiday home.

Some luxury properties have been discounted by as much as 70 per cent.

Best of Magnetic real estate owner Kelvin Dyson said Magnetic Island was a lifestyle destination, typically attracting holiday investors, which had worked to its disadvantage in tough economic times.

"I've been here for 12 years and prices haven't been at these levels since 2003/2004,'' Mr Dyson said.

"Especially for vacant land.

"I think Magnetic Island has traditionally been an investment market and it has suffered like the whole of the Queensland coast, especially because it's holiday land."

Port Douglas and Airlie Beach have also taken price hits, he said.

Mr Dyson said the island's market peaked in 2007, steadily declined, and now appears to have finally hit the bottom.

"Serviced residential blocks are now available for $100,000. You can't even subdivide land for that on Magnetic Island if you were given it,'' he said.

"I guess that's the value on Magnetic, things are below the coast of replacing them.''

Mr Dyson said units around the harbour (Nelly Bay) were particularly good value with some originally worth $1.3 million now available for $400,000 - a 69 per cent discount.

"We are talking three-bedroom luxury units,'' he said.

He is currently selling a one-bedroom fully furnished apartment at Nelly Bay's Blue on Blue for $298,000, which was originally bought for $580,000.

Smith & Elliott Real Estate agent Alex Strens said Nelly Bay units were up for grabs for as little as $215,000.

"It (sale volume) is just starting to pick up now and while people are being a bit cautious buying, there has a been a fairly good turn around,'' Ms Strens said.