Developers in Brisbane have dropped a third of all proposed apartments, a new report reveals, highlighting a marked drop in the market.
Place Advisory’s Inner Brisbane Apartment
market report reveals that 33% of apartment projects were shelved over the past 12 months ending in September, a significant slump from the 19% figure gleaned in the previous 12 months ending September 2015.
Developers report that 24,633 Inner Brisbane apartments spread across 111 projects are in the pipeline, a 5.9% increase.
However, about 8,000 will be shelved with Place Advisory saying that the likelihood of all 111 projects making it to the marketplace at the same rate as seen in previous years “is expected to soften.”
“This increase in the number of deferred projects over the past 12 months can be attributed to various changing economic conditions,” Place Advisory says in its report.
“These include tighter lending policies for both developers and purchasers, higher construction prices, softening sales rates and restrictive policies for foreign investors,” it adds.
Nonetheless, the report also noted that despite the overall market sentiment, the Inner Brisbane apartment market saw a total of 542 unconditional sales during the three months ending in September.
Place advisory also notes that the weighted average sale price recovered, increasing 5% quarter-over-quarter, to $617,297.
Though the unconditional sale figure is congruent with ten year averages and is a 17% increase from the second quarter of the year, it represents a 61% softening through the past 12 months, the organisation says.