Invest
Property markets reaching saturation point
The number of dwellings in capital cities is eclipsing or beginning to eclipse Australian population growth, an economic forecaster has warned.
Property markets reaching saturation point
The number of dwellings in capital cities is eclipsing or beginning to eclipse Australian population growth, an economic forecaster has warned.
BIS Shrapnel says the recent home building boom expected to peak this year differs from previous peaks.
“Investors and foreigners are driving this and the preference away from detached houses towards apartments. It’s a very different boom, so it’s a question of what happens next,” BIS Shrapnel’s associate director of building forecasting Kim Hawtrey told nestegg.com.au.
“We're probably going to touch or come close [to] touching 240,000 dwelling commencements at the peak of this boom, and building will probably stay at a pretty healthy level, around 200,000 commencements for the next few years,” Mr Hawtrey said.
“When you’ve had such a unique home building boom, is it sustainable? Is it driven by fundamentals? Are we building far too much than we should?”
For many Australian capitals, that rate of new dwellings is outpacing or will outpace the number of Australians who require them.
“We’ve had such strong population growth so [the rate of building] is justified, particularly somewhere like Sydney where for a decade we simply didn’t build enough dwellings,” Mr Hawtrey said.
“It’s justified building above the rate of household formation, above the rate of population growth and we can afford to do that for a number of years, particularly in Sydney.”
While construction has yet to reach saturation point in Sydney, other cities have already surpassed it.
“In the other markets, we’re nearing or already at the point of saturation, where the number of homes for people to live in is at or increasingly above the number of people to live in them,” Mr Hawtrey said.
“Certainly, in Perth and Adelaide we see that, while Brisbane is probably at that point now. Melbourne is approaching that point.
“Sydney is not yet at that point. We think Sydney will go stronger for longer just because it’s got more people to house basically.”
RELATED ARTICLES
Property
North platform adds household reporting feature to boost adviser efficiency
AMP's North platform has launched consolidated household reporting across multiple client accounts, helping financial advisers streamline their client review processes. Read more
Property
What Adds The Most Value To Properties?
Wondering how to up the value of your property? Properties are worth a lot of money in general, but there’s always a way to maximise value. The good news is that most of the things you can do to ...Read more
Property
Centuria reports strong growth in alternative real estate sectors for FY24
Centuria Capital Group has reported significant growth in alternative real estate sectors for the 2024 financial year, driving stable performance and increased guidance for FY25. Read more
Property
How to leverage equity in your home for investment or renovation
Home equity, the value of your property minus any debts owed, is a powerful financial resource many homeowners in Australia can utilize to further their financial goals. Whether you're looking to ...Read more
Property
Exploring REITs: Real estate investment without buying property
Real Estate Investment Trusts (REITs) offer a compelling investment alternative for those interested in the real estate market but may not want to endure the complexities and capital requirements of ...Read more
Property
Retirement communities: a pivotal element in meeting Australia's housing targets
The Retirement Living Council (RLC) has recommended that retirement communities should be considered a vital part in the Australian Government's initiative to fulfill the Housing Australia Future Fund ...Read more
Property
Australians adjust financial strategies amid changing property market dynamics
The 2023 calendar year saw Australian borrowers acquiring a total of $300.9 billion in new loans for property purchases, marking a 12.7% decrease from the previous year. Read more
Property
Split home loans unlocking doors for Aussie buyers
Australians are teaming up to dive into the real estate market and seize the advantages of home ownership, with the trend of split home loans surging as family and friends unite to buy properties ...Read more
Property
North platform adds household reporting feature to boost adviser efficiency
AMP's North platform has launched consolidated household reporting across multiple client accounts, helping financial advisers streamline their client review processes. Read more
Property
What Adds The Most Value To Properties?
Wondering how to up the value of your property? Properties are worth a lot of money in general, but there’s always a way to maximise value. The good news is that most of the things you can do to ...Read more
Property
Centuria reports strong growth in alternative real estate sectors for FY24
Centuria Capital Group has reported significant growth in alternative real estate sectors for the 2024 financial year, driving stable performance and increased guidance for FY25. Read more
Property
How to leverage equity in your home for investment or renovation
Home equity, the value of your property minus any debts owed, is a powerful financial resource many homeowners in Australia can utilize to further their financial goals. Whether you're looking to ...Read more
Property
Exploring REITs: Real estate investment without buying property
Real Estate Investment Trusts (REITs) offer a compelling investment alternative for those interested in the real estate market but may not want to endure the complexities and capital requirements of ...Read more
Property
Retirement communities: a pivotal element in meeting Australia's housing targets
The Retirement Living Council (RLC) has recommended that retirement communities should be considered a vital part in the Australian Government's initiative to fulfill the Housing Australia Future Fund ...Read more
Property
Australians adjust financial strategies amid changing property market dynamics
The 2023 calendar year saw Australian borrowers acquiring a total of $300.9 billion in new loans for property purchases, marking a 12.7% decrease from the previous year. Read more
Property
Split home loans unlocking doors for Aussie buyers
Australians are teaming up to dive into the real estate market and seize the advantages of home ownership, with the trend of split home loans surging as family and friends unite to buy properties ...Read more
