Two Cairns suburbs rank among Australia’s best for investing
TWO Cairns suburbs have been identified in the top five of 100 Australian suburbs for best return on investment.
The latest CoreLogic rental yield figures place Woree and Manunda in third and fourth.
The top 100 list was made up of suburbs where houses or units had an estimated gross rental yield of 5 per cent or more a year.
Queenslander specialist at iicon Portfolio Real Estate, Ken Higgins, said he was not surprised to see the two inner-city suburbs high on the list.
“People want to be closer to the city and everyone is time poor,” Mr Higgins said
“With the travelling factor, with the northern and southern corridors now, the bottleneck is just getting worse.
“We haven’t seen that crazy price rise like Sydney and Melbourne.
“Our vacancy rate is now in some cases 1.5 to 2 per cent.
“The norm is 4 per cent.
“We’re getting good returns there with 5 or 6 per cent returns,” Mr Higgins said.
CoreLogic data showed houses in Woree were selling for about $300,000 and yielding $373 at 6.5 per cent in the year to June.
Units were reporting a rental yield of 10.3 per cent.
Both houses and units in Manunda recorded slightly higher median prices than Woree, with rental yields of 5.8 per cent for houses and 7.9 per cent for units.
Mr Higgins said the rise of Airbnb in Cairns had contributed to the high rental yields being reported.
“It’s cutting out that rental size so that brings the vacancy rate down and in turn that drives the rent up,” he said.
Mr Higgins said he was surprised there was minimal interest being shown by investors in Manunda, with the majority of buyers settling as owner-occupiers.
He said the interest from buyers looking at Manunda had picked up significantly in the past six weeks, compared to the first six months of the year.
With a QBE report recently stating house prices across Cairns were set to rise by 8 per cent by 2022, Mr Higgins expects more investors to become involved in Cairns soon.
“It doesn’t take much for Cairns’ (property prices) to kick,” he said.
“It’s not always the locals that drive our market,” Mr Higgins said. “It’s more the southern investors.”