If you are thinking of buying property in Port Douglas, right now is a good time to buy. While economic conditions have improved, prices are still well below the 2007/8 market peak for some property types. However, most of the signposts are pointing to increasing rents and higher prices for the foreseeable future.
The most powerful drivers of the property market are local conditions, which are improving, and the national economy, which is growing slowly with low inflation.
Tourism in Port Douglas has been spectacular this year. Many properties are reporting record occupancy rates and increasing room prices. Forward bookings for holiday properties are stronger for October and November than they were last year, according to holiday management agencies such as Ray White’s partner Port Douglas Accommodation.
As the Sheraton goes, so goes Port, so the revival of the Sheraton is good news for the entire town. The property sank pretty low a few years ago, but the new owners are throwing the kitchen sink at the renovations and it’s coming up a treat. The recent increase in the room rates is an indication of the direction Port is heading.
Across the board, holiday properties are reporting 10% higher income for 2015/16 than they did the previous year, making a lot of holiday units attractive investments.
This increase in rents flows through to the residential market as well. Rents have increased by more than 5% this year, and Ray White currently has only two houses and three units for rent out of 300 properties on our list, which is a vacancy rate of 1.7%. A vacancy rate under 5% is considered low enough to put pressure on rents.
The Australian economy has registered 25 years of continuous growth, very nearly a world record. There doesn’t seem to be any economic slowdown on the horizon, with GDP growth increasing from 2% to 3.3% over the past year. In the past, increasing economic activity put pressure on inflation, but inflation is currently just 1%.
Because of these factors, interest rates will remain absolutely rock-bottom for the foreseeable future. It is currently possible to find mortgages at interest rates lower than 4%, and there is no realistic prospect of them increasing dramatically.
Over the short term, low interest rates in a growing economy tend to push up property prices. While some property markets in Australia are overheated – there is an apparent glut of apartments in Melbourne and Brisbane – Port Douglas is currently going through a steady increase in prices as local conditions improve.
However, prices for some types of property are still well below their peak of 2007/8, with Port Douglas units currently about 35% below their best prices, and Wonga represents some of the least expensive real estate on the entire east coast of Australia.
If you would like to know more, please contact your preferred Ray White agent.
Port Douglas: 07 4099 5355 Four Mile: 07 4098 5222 Mossman: 07 4098 1333 or email@example.com