Rainbow Realty Deal June 2013

“Travel, in the younger sort, is a part of education; in the elder, a part of experience.”
Francis Bacon

The stunning coastline that we live beside is very popular with people of all ages and many people want to own a piece of it by purchasing their own holiday home or beach side residence. There are plenty of cashed up bargain hunters around at the moment and although we are competing with the likes of Noosa, Peregian Beach, Coolum, Bargara Airlie Beach, etc – many buyers are seeking out the beauty and unique location of Rainbow Beach as their preferred holiday or retirement location. The fact that we are on the doorstep of Fraser Island is a great advantage as well.

Prices up and down Australia’s eastern seaboard have declined over the past 4-5 years and many buyers are taking advantage of this price correction and getting in now before the property market inevitably rises again. Real Estate Agents up and down the coast are reporting more sales to holiday home buyers, as many take note of the price drops by vendors.

The Fairfax-owned Australian Property Monitors has released a list of coastal hot spots that are now more affordable than a decade ago. In many, prices have continued to fall since the global financial crisis. And lower prices mean higher rental yields, especially over peak periods such as Christmas and Easter. We have a number of holiday homes that gross in excess of $40,000 per annum; some of which can be purchased for between $400,000 - $700,000. Gross rental yields of 6-7% are not uncommon; making the return on investment for buyers pretty attractive. One of the most popular holiday homes we manage rents out for just under $5,000 per week over the peak period; providing the owners with an impressive passive income on their investment.

Holiday home buyers who have held off buying in recent years are now reaping the rewards. Self-funded retirees who have been watching the market from the sidelines since around 2007 are now recognising value for money and pouncing on opportunities including the occasional ‘mortgagee in possession’ property listed for sale. Another trend we have seen growing in popularity is people investing in property through a Self Managed Superannuation Fund (SMSF). This allows people the flexibility to utilise their superannuation savings (and in some cases, borrow through their Super as well) and buy property in a location of their choosing – an option which may not be available to them outside of their superannuation.

Lower interest rates have renewed investor confidence and with the likelihood of a change of government in September, many commentators are predicting renewed consumer confidence and a strong return to the property market under a new government. Generally speaking, people buy a holiday home when they are feeling good about their financial situation as well as the broader economy.

We are all looking forward to the winter months and the clear, sunny days and calm ocean conditions that we are typically treated too between now and August. A big event in town during the winter is the Rainbow Beach Family Fishing Classic. This year, the competition will run from the 28th June through until the 6th July, 2013; coinciding with the School holidays for the first time in its long history. There have been some bold predictions that the fishing will be excellent this year, with plenty of great catches already since the beginning of May. Check out these great photos of Dee’s Mum and Dad out on the Keely Rose over the Gympie Show Holiday weekend! Amazing Coral Trout catches…we are just waiting for our invite to dinner!