Cairns Watch shows "moderate" economic growth but good signs on employment

 

Is an increase in job advertisements in Cairns a sign the TNQ economy is ready to boom again with a period of strong employment and economic growth?

The October Cairns Watch report by Herron Todd White shows that while the Cairns economy is advancing the rate of growth had “moderated” in the past month with improvements across key categories including airport visitor numbers, employment figures and job advertisements in the city.

There was also a “spike” in building approvals in August.

Buoyed by the inclusion of 110 new units to be built in the Cairns CBD as part of the Crystalbrook Collection, another spike is expected when the first component of the Nova City Development (335 new units) reaches the building approval stage, Mr Carr cautioned it was not all good news in the construction industry.

“While these Cairns CBD developments are very welcome, it is drawing a long bow to suggest that just two projects are the start of a new upward trend rather than one-off spikes,” he said.

“The number of new houses in particular remains at a low ebb.”

Trend employment was up 7.7 per cent between September 2016 and 2017 and the unemployment rate has also reduced “significantly” in the past 18 months.

It now sits at 5.6 per cent in September 2017, below the state average of 5.9 per cent with the job advertisements trend rising to 8.1 per cent from September 2016 to 2017.

This figure was based on an analysis by economist Pete Faulkner from data released by the Australian Bureau of Statistics.

In the year to September 2017, passenger numbers have increased in trend terms by 0.7 per cent at the domestic terminal, 5.2 per cent at the international terminal, and 1.3 per cent overall.

“Passenger number trends at Cairns Airport have also eased off in recent months at both the domestic and international terminals, moderating the year-on-year trend growth rates,” he said.

On the property front, Cairns remains very much in a “steady state” with generally static prices with the analysis pointing to decreases in property prices with a slight drop for houses and units but a slight upwards movement for land.

“Even though price movements for individual properties can be mixed, our general view is that prices overall are relatively static,” he said.

“The latest trend median prices, for properties sold in the month of September 2017, came in at $405,000 for a house, $204,000 for a unit, and $213,000 for a block of land.”

“The number of residential properties listed for sale in Cairns also remained static in the past year due to the number of new listings each quarter closely matching the numbers of sales.

“The overall number of properties listed for sale stood in trend terms about 2,800 in the September 2017 quarter, made up of about 1,800 houses and approximately 1,000 units.”

Source: www.tropicnow.com.au

Cairns economy 'powering ahead' as jobless rate falls

 

A local economist says the Cairns economy is “powering ahead” with the trend unemployment rate falling to 5.3 per cent in June, the lowest level seen in almost a decade.

 

Analysis of the latest ABS figures by economist Pete Faulkner at Conus shows the trend unemployment rate in Cairns is at its lowest level since September 2008 and well below the state average of 6.3 per cent.

 

Trend jobs have increased by 1,300 since May and are up by 12,700 for the year. Of those jobs, 7,800 were full-time positions with the trend participation rate increasing to 63, its highest level since October 2013.

 

Mr Faulkner said the latest figures and strongly positive results for the year means “there is no doubt that the recovery remains in place”.

 

Cairns is now the third fastest growing region for employment growth outside of Greater Brisbane.

There is also good news in Townsville with trend unemployment at 7.5 per cent, down from 7.8 per cent in May.

 

In the past year, Townsville has added 13,400 new jobs, with 10,000 being full-time.

 

Mr Faulkner said there was a significant recovery in the labour market in the past year in Cairns and Townsville and the latest unemployment figures were good news for regional Queensland as a whole.

“The regions generally have done better with the trend unemployment rate in the rest of Queensland falling to 6 per cent, while Greater Brisbane has risen to 6.7 per cent,” he said.

 

“For the year, the rest of Queensland has added 31,700 new jobs (22,300 full-time) while Greater Brisbane has added 11,700 new jobs (8,200 full-time).”

 

However, Cairns' youth unemployment levels remain stubbornly high and is up slightly to 12.6 per cent in June with an extra 3,400 youth jobs in the past year. Youth unemployment in Townsville dipped to 18.4 per cent.

 

The full Conus Trend data for unemployment in Queensland is available for download: http://www.conus.com.au/blog/

QLD First Home Owners' Grant boost extended until the end of the year

 

The Queensland First Home Owners' Grant is a state government initiative to help first home owners to get their new first home sooner. Depending on the date of your contract, you’ll get $15,000 or $20,000 towards buying or building your new house, unit or townhouse (valued at less than $750,000). You can even buy off the plan or choose to build yourself. It’s a great opportunity to buy or build a new home in our great state.

 

How a Queensland First Home Owners' Grant can help you

• If you're thinking of buying or building a new home, this could be what gets you started.
• It could get you something more than you were expecting.
• It can get you into your first home sooner.

Note: The $20,000 Queensland First Home Owners' Grant is not available to contracts that replace previous contracts entered into before 1 July 2016. If your contract to purchase or build is signed between 1 July 2016 and 31 December 2017, you may be eligible to apply for the $20,000 grant.

To be eligible for the grant:

• You must be an Australian citizen or permanent resident (or applying with someone who is).
• You or your spouse must not have previously owned property in Australia.
• You must be at least 18 years of age.
• You must be buying or building a brand new home, valued under $750,000.

Source: https://firsthomeowners.initiatives.qld.gov.au/...

Could you get caught with a foreign investor's tax bill?

The 2017 May Budget introduced a range of Government initiatives aimed at restricting foreign ownership, and while some of these may give the impression of helping affordability for local buyers, there is a risk that some home buyers could be held liable for the owner’s tax bill.

Previously, legislation required buyers of properties owned by foreign residents (worth more than $2 million) to withhold 10 per cent of the purchase price and send it to the Australian Tax Office (ATO). As a result of the Budget, the threshold has been reduced. Now every property worth $750,000 or more is affected and the Withholding Tax will increase to 12.5 per cent from 1 July. However, the previous threshold and rate will apply for any contracts that are entered into before 1 July 2017, even if they are not due to settle until after 1 July 2017.

While the changes have been generally welcomed, it is essential that lawyers and conveyancers proactively ensure their clients abide by the law. Buyers who don’t retain the 12.5 per cent withholding tax could find themselves liable for a penalty from 1 July, which could be the full 12.5 per cent of the purchase price as well as interest. Nobody would want that!

The ATO website states that purchasers who don’t receive a “clearance certificate” from the vendor and don’t send the Withholding Tax to the ATO, will be held liable.

To avoid potential settlement delays, complications and the risk of liability, owners who are selling properties worth more than $750,000, should request a clearance certificate from the ATO to prove they’re an Australian resident for tax purposes. Likewise, buyers of such properties should have their lawyers or conveyancers double check that the certificate has been obtained.

‘Purchasers who don’t receive a “clearance certificate” and don’t send the Withholding Tax to the ATO, will be held liable’.

Now that many more properties fall into the Government’s tax net, there’s potential for delays acquiring clearance certificates, which used to take anywhere from a few days to four weeks. So, vendors would be well advised to apply for the certificate the moment they appoint a conveyancer or real estate agent. This will assure that the moment a sale price is agreed with a buyer, there will be no impediment to completing a contract of sale and the buyer will have confidence they are not placed at risk.

For the majority of local buyers, there should be minimal risk as long as they make sure the Clearance Certificate has been obtained. However, for local resident vendors, the risk of a tax audit following the request for a Clearance Certificate could be heightened, under certain circumstances.

First National Real Estate Cairns Central
http://www.fncairnscentral.com/