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Calls for calm on property ‘oversupply’ fears
Fears surrounding the oversupply of new apartments in Australia have become increasingly and unnecessarily "exaggerated", according to the chief executive of an online property agency.
Calls for calm on property ‘oversupply’ fears
Fears surrounding the oversupply of new apartments in Australia have become increasingly and unnecessarily "exaggerated", according to the chief executive of an online property agency.
iBuyNew CEO Mark Mendel said talk of the apartment oversupply is "overstated", as a number of the proposed developments will "never eventuate" due to many developers being unable to obtain finance.
"While there is a lot of discussion about banks toughening their lending policies for buyers, they are even tougher on developers," he said.
"Developers with no track record are getting a blanket 'no' from lenders across the board while those with a limited track record are also finding it extremely tough."
Mr Mendel said while some areas may experience an oversupply of apartments, it's unrealistic to say it's a nationwide issue.
"You really need to look at the specifics of each state, region and suburb," he said.
"There are definitely pockets of Brisbane, Melbourne and Sydney that may experience an oversupply of apartments.
"But if you look at Zetland/Waterloo in Sydney’s inner south where thousands of new apartments have been built over the last five years, everyone expected an oversupply but capital growth has still been more than 10 per cent in the last 12 months."
Mr Mendel said south east Queensland in particular was going through a massive transformation.
"This is becoming an international region with infrastructure developments such as the new $2 billion casino in Brisbane as well as the Gold Coast hosting the Commonwealth Games in 2018," he said.
"These elements will change the way the world sees Brisbane and south-east Queensland in coming years."
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