Cairns property values surge to new peak amid supply shortage

REA economist Eleanor Creagh has provided an update on the Cairns property market

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Cairns home prices have hit a new record median of $655,000, notching up double-digit annual growth despite dual pressures of rising interest rates and surging cost of living.

PropTrack’s Home Price Index for March, released today, shows Cairns property values have jumped 13.15 per cent over the past 12 months.

While the Far North Queensland market remains incredibly strong year-on-year, quarterly data points to a subtle cooling, with prices growing by a modest 0.99 per cent over the past three months.

REA Group senior economist Eleanor Creagh said the easing quarterly momentum in markets like Cairns pointed to a broader national shift, even as regional Queensland outperformed the broader country.

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“This points to a slowdown in growth emerging across the country and a clear turning point in the cycle, as rising interest rates weigh,” Ms Creagh said.

However, she noted that significant price declines were unlikely in tightly held regional markets.

“Recent rate rises will weigh on buyer sentiment… though a resilient labour market, population growth and first-home buyer support continue to underpin demand against limited supply.”

Real Estate Institute of Queensland (REIQ) CEO Antonia Mercorella said the ongoing price growth in Cairns was directly linked to a dire lack of available housing.

“We’re still not building at the scale and speed we need to relieve the supply squeeze, and with every quarterly target not met, we’re falling further behind,” Ms Mercorella said.

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She said the number of properties hitting the market across regional Queensland had dropped by 15 per cent compared to the previous year, leaving local buyers fighting over scraps.

“The established housing market is still drip-feeding properties for sale but remains restricted as property owners hold on tight to their homes.”

Global instability and resulting inflation were an added hit on the construction sector’s ability to deliver new homes in fast-growing regional hubs, she said.

“The flow on inflationary impact to manufacturing and construction, through higher transport and logistics costs, couldn’t come at a worse time,” Ms Mercorella said.

“Counting the cranes on the horizon has traditionally been a promising sign of what’s in the immediate pipeline, but with high-cost risks and exposure for builders and developers comes uncertainty.”

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