Douglas Shire market moving back to 'steady normal'
HOUSING MARKET
One thing that is certain in real estate is that the market never stays the same. A silver lining of COVID was a property boom across Australia, a clear indication of this locally is that we have seen more capital growth in the last 2.5 years than we have seen in the last 10 years.
The current market is moving from a frenzy back towards a steady “normal”.
At the beginning of May 2022, official interest rates were sitting at 0.1%. By the end of 2022, the cash rate had increased to 3.1%.
As a result of the fastest and most significant interest rate tightening cycle in many decades, the cash rate is the highest it has been since November 2012.
While most economists didn't expect interest rates to rise as fast and high as they did in 2022, we've already experienced two consecutive increases this year.
New listing volumes have always been highly seasonal and there are more factors at play in our local region. In particular, the severe lack of new residential housing estates and development throughout the Shire.
This situation has long been identified but unfortunately for the local residents, it appears very little has been done to alleviate it.
We are now really starting to see the true effects of this lack of new housing and a shortage of available apartments and houses for sale.
This is clear by the fact that all agencies across the shire are running at record low levels of properties for sale or rent.
One other thing to take into account is that rents, nightly rates, and occupancies have also risen significantly over the last three years in line with property values.
This helps pay for the higher interest rate costs that investors will be seeing so takes the immediate mortgage pressure off.
Property prices in the shire are currently holding while the pressure is turned up with interest rate rises.
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Mark Flinn is the Selling Principal at Ray White Port Douglas. For more information contact Mark on 0405 646 313.
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