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There has been some media interest yesterday and today for a Tweet we made yesterday about the fact that the median house price in Cairns has now returned to where it was about eleven years ago…just over $400,000. Despite solid interest in the property market in the past two years (and with prices up 8-10% in the past 12 months) it’s extraordinary to think that the median price is still now only back to where it was so long ago, especially when we consider what we know has happened to prices elsewhere.
There has also been a huge disconnect in what has happened to prices versus movement in median rents in Cairns.
Consider the changes over the past 10 years.
In Cairns the median house price is up 2% while median house rent is up 53%. Yet in Sydney, where median house price is up 107%, rents are up just 19%. Likewise in Melbourne; prices up 86%, rents up 20%. Even in Brisbane prices are up 72% and rents up just 32%.
If we simplistically compare prices with rents (and ignore things such as insurance, rates and costs) then 10 years ago the median house in Cairns was about 23 years-worth of median rent. In Sydney that figure was 25 years, in Melbourne 26 years and in Brisbane 23 years. So we see a very similar relationship across all the cities despite very different prices and rents.
However, ten years later in March 2022, Sydney median house price is now about 43 years-worth of median rent; Melbourne is 41 years and Brisbane is 30 years. Cairns is now just 15 years-worth of median rent for a median house price!! In the past decade Cairns has gone from being broadly in-line with the southern capitals to now being somewhere between two and (almost) three times cheaper.
All data quoted is sourced from SQM Research.
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