Whitsunday at bottom of market

The Whitsunday area is now at the bottom of the property market and set to rise, according to the latest Herron Todd White monthly report.

It says the market is fairly steady across the board with a shortage of rental houses and a fair demand for new houses and units.

This may mean it’s time for Whitsunday buyers to invest the lazy $500,000 which Herron Todd White previously recommended buyers hold spare.

According to the REIQ, unit prices in the whole Whitsunday area have increased 7.6% over the past year – led by massive increases in Airlie Beach.

The median unit price in Airlie Beach in the year to June 2013 was $434,500, 44.8% greater than the previous year. RP Data puts that figure at 58%.

In Cannonvale REIQ says unit prices fell 4.6% over the past year. RP Data says they fell 10.4%.

In July Herron Todd White said Airlie Beach was seeing an improvement but mainly in the sub $500,000 market.

It said the unit market was close to the bottom of its cycle and could be set for a rebound, though some units were afflicted by very high body corporate fees.

“Last year saw builders and others snapping up the bargain buys of residential land on offer. This has eased the over-supply of land with values firming a little. There is still good land buys available especially in the acreage lots and future development sites,” Herron Todd White wrote in July.

“The Bowen market has eased with investment monies still speculating on future demand by mining and Abbott Point upgrades.

“Real estate in Airlie Beach locality now seems cheap compared to the past few years, but we are still in a bear market. How long will this bear market last is how long to hang onto that lazy $500,000 before investing.”

Cannonvale was recently labelled as one of the biggest turnaround waterfront suburbs in Australia.

Houses prices in the suburb increased 20.25% in the past two years, according to Real Estate Investar. Three to four years ago house prices fell 14.85%.

It’s also one of the highest yielding waterfront suburbs in Australia with two bedroom units yielding 6.68%.

According to PRDNationwide yields across the Whitsunday area were at 4.6% for houses and 4.8% for units in quarter two.

It said activity in the house market overall was slowly increasing to the levels experienced during the stimulus driven period of 2009 but affordability was attracting fly in fly out miners.

“Affordability for units within the Whitsundays is at its highest level since 2003,” PRDNationwide said.

“While the majority of unit sales transact for $299,999 or less (at 68%), there has been a revival of activity for above $700,000 over the second half of 2012, amounting to 17% of total sales. This is up from 7% recorded two years prior.

“It appears that the affordability of this coastal market has attracted many fly in fly out miners to base their young families in the Whitsundays.”

According to RP Data the median unit price has fallen 34.2% over the past five years in Airlie Beach and 31.4% in Cannonvale.

Houses seemed more stable with house prices falling -8.7% in Cannonvale over the past five years.

A two-bedroom unit in Airlie Beach at 57 & 57a5 Golden Orchid Drive is listed for sale at $280,000. Agent Charmaine Potter says the property rents at $470 per week – a yield of 8.73%.

A three bedroom Airlie Beach unit at 3/7 Lamond Street is listed for sale at $310,000. It last sold in 2004 for $250,000.

A three bedroom Airlie Beach unit at 2/9 Hermitage Drive is listed for sale at $275,000. It currently rents at $350 per week – a yield of 6.62%. In 2006 it sold for $280,000.