Far North can weather storm
A PROPERTY industry analyst says Cairns and Far North Queensland can weather the impacts of Qantas flight cutbacks.
Herron Todd White research director Rick Carr said yesterday if alternative airlines were not found to fill the gap left by Qantas’ decision to slash its Japan links with Cairns, about 18 months to two years of normal tourism industry growth would be wiped out.
However, Mr Carr said despite the predicted job losses of 1600 and a reduction in expected visitor spending in the region, the tourism industry would survive.
"The Cairns/TNQ tourism industry has proven to be extremely resilient in the past, and although the immediate impact of Qantas flight reductions on the Cairns/TNQ economy will be serious, the overall effect will not be catastrophic," Mr Carr said in CairnsWatch, the monthly analysis of the Cairns and Far North economic conditions.
Mr Carr said while Japan was the largest single source of international visitors to Cairns, it made up only 8.5 per cent of all visitors and had been in significant decline over the past four years.
"The (Qantas) flight reductions by about 55 per cent from December pre-empt a downward trend that is already evident in the Japanese market and compound an already difficult tourism situation due to the impact of high fuel prices and the high Australian dollar," Mr Carr said.
"However, the key is to build alternative markets, such as China to compensate."
International passenger numbers through the Cairns Airport, which had been declining in trend terms in recent months, were now stabilising.
On the property development front, Mr Carr said building approvals were continuing to ease and were now running at about 100 a month for houses and 60 for units.
"We still perceive the building industry to be busy from the backlog of housing demand, but with forward order books shrinking, builders are also slowing the pace of their current work," he said.
One upside was an easing in the tight rental market. In May the unit vacancy rate increased to 3 per cent while for houses there was a slight easing to 2.4 per cent.
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