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When is a good time to buy an investment property in Cairns? It’s a simple question, and we’ve got a surprisingly simple answer to go with it.
The best time to buy an investment property in Cairns was a decade ago – but the second-best time to buy in Cairns's burgeoning real estate market is right now.
Of course, this is a simple answer, but with house prices in Cairns increasing by more than 6% over the past 12 months, and a staggering 33.2% between March 2020 to January 2023, it’s little wonder that the urgency in the market is at an all-time high.
The rising market trends in Cairns are far from a short-term spike. Cairns has long been recognised as a popular tourist destination, however, in recent years, it’s seen an influx of new buyers and investors looking to make the most of the tropical lifestyle and economic growth of the region.
For those looking to stake their claim on Cairns’ real estate market, this article looks at why now is the perfect time to invest, explores the market dynamics driving growth, and looks into the future prospects that make Cairns such an attractive proposition for investors and homebuyers alike.
Table of Contents
Cairns has seen significant growth off the back of the real estate surge between 2020-2023. In 2023, vacancy rates in the Cairns property market hit an all-time low of 0.7% - well down from what is considered to be a healthy range of 2.6-3.5%. As a result, rental prices have surged, and the market is rife with would-be first-time buyers looking to escape the rental market.
As of Q3 2023, Cairns saw an 8.65% increase in house prices and an even more substantial 11.11% increase in the price of units. Both of these figures exceed the state averages of 5.26% and 6.91% respectively with Cairns’ average house pricing now reaching $585,00 and $300,000 for units. The rapid growth of the local property market underscores the increasing local demand as supply remains tight, vacancies continue to set new record lows, and more people looking to invest in the region.
In 2023, the Cairns property market enjoyed steep growth with Palm Cove leading the way with a growth of 14.3% making it one of the most sought-after suburbs in North Queensland. Closely followed by Whitfield at 13.1% and Clifton Beach at 11.5% growth respectively, the suburbs of Edge Hill, Freshwater and Machans Beach are also honourable mentions of the most sought-after suburbs in Cairns for 2023.
Collectively, these suburbs represent the diverse range of areas that are experiencing growth in the Cairns property market. At different price points and with a different demographic for each, these areas offer unique attractions and liveability benefits for buyers and investors alike.
There are a number of important factors that are driving demand and property prices in Cairns for 2023, however, none more so than the critically low vacancy rates of 0.7%. The low vacancy rates demonstrate a significant imbalance between supply and demand with the average cost of a 3-bedroom rental house reaching a new high of $490P/W in June 2023. These numbers, once reserved for large metropolitan areas, are expected to continue into 2024.
Cairns is experiencing population growth, significantly driven by the rise in remote working opportunities, evolving market dynamics, and increased interstate migration. Additionally, the region's tourism economy is now returning to its pre-pandemic stability with tourism picking up and stabilising in the local economy.
Cairns has long been one of Australia’s favourite tourism destinations, however, the sentiment is now shifting, and Cairns is becoming much more than a tourist hotspot. The region’s attractive lifestyle offerings, combined with economic stability and investment potential means that it now represents an appealing prospect for investors.
For those looking to enter the market in Cairns, now is the time. The market has shown significant resilience and sustained growth that far outpaces the national and state averages to demonstrate its potential for residential real estate investment in 2024 and beyond.