Apartment market set to surge

Rising demand and prices

Apartment market set to surge


By Mina Martin

The Australian apartment market is expected to experience robust growth over the next year, according to a recent survey conducted by CBRE, Hotspottting reported.

With increasing costs and slow production pipelines, valuers predict strong performance, especially in Perth, Brisbane, and Adelaide.

Growing confidence in apartments

A survey from CBRE shows that 45% of property valuers anticipate an increase in buyer demand for apartments over the next 12 months, a slight decline from 57% in March.

However, optimism remains high with more than 50% expecting price increases in the apartment sector.

Valuers are particularly bullish about apartment values in Perth, where more than half expect a minimum price increase of 5%. Similarly, around one-third of valuers predict that apartment prices in Brisbane and Adelaide will rise by the same margin.

See LinkedIn post here.

Sameer Chopra, CBRE’s Pacific head of research, highlighted the current challenges in the apartment market.

“The production supply pipelines for apartments are slow, so there is not a lot of new stock coming onto the market,” Chopra said.

“The cost of putting up a new apartment is now 35% higher than where it was sitting in 2019.” He added, "More people are coming to this realization that it’s just very expensive to build brand-new stock, so they will pay more for the right stock today.”

Broader housing market trends

The CBRE survey also indicated broader optimism in the housing market, with more than 40% of valuers expecting house prices to rise by more than 5% in the coming 12 months.

The metropolitan areas of Perth, Adelaide, and Sydney are expected to lead this trend, reflecting a robust overall property market in Australia, Hotspotting reported.

Read the Hotspotting article here.

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