A little confidence goes a long way in Cairns real estate market
And just like that, we're more than halfway through February. As usual, the first couple of weeks of January were uneventful but we seem to have picked up where we left off last year - pretty busy.
As my colleague Kaine just said to me – I don’t know what is going on, but it's good! Time will tell whether we are just picking up last year’s scraps or not.
It is hard to argue that prices here are not still laughably low, compared to Sydney and Melbourne especially.
I couldn’t tell you how often prospective sellers say something like “if this house was in Sydney it would be worth millions!”.
Likewise, if we meet a buyer who has just sold up in one of the hotter markets, they are going to be generally freer with their negotiations than someone who just lost money on their sale.
Annoyingly we just aren’t seeing a lot of southern buyers. Sure, there are some but you couldn’t count on them being the likely buyer for any property.
I often wonder why this is and I can only conclude that if our rental returns are similar to the capital cities and the perception is that growth is minimal here, why would you invest in Cairns when 5 – 10% growth per annum has been commonplace in those markets?
That all could be about to change. Sydney is definitely off the boil and our market could get going… and as we all know, traditionally when we come from a low base we tend to kick pretty strongly.
Confidence. It means a lot in a marketplace. For the last few years we seem to have stopped and started a few times.
Mid-last year, for example, we just died. Hardly sold anything for two months and then it just picked up again. I think all we are lacking is some confidence.
Many small businesses are still sitting on their hands still reluctant to upscale and employ, still smarting from some tough years. There are some exciting signs though… one of them is sales of property over $2 million.
In 2014 there were none, 2015 there were 2, 2016 there was 1… and 2017 there were 6 (of which 3 were ours at Belle).
Small numbers you may argue but house sales over $1 million also look to have maintained their record levels.
We have some great property coming to the market in 2018 and can’t wait to get our teeth into what should be a better market to work in.
As always, I am only ever a phone call or email away if you would like to touch base and talk about your property or interest in purchasing.