Sales at two of Australia’s largest residential developers have fallen sharply over the past year, prompting the Real Estate Institute of Queensland (REIQ) to warn that the recovery in new housing supply could stall.
REIQ chief executive Antonia Mercorella (pictured) said the figures should serve as an early warning for policymakers.
“Today’s weaker demand risks becoming tomorrow’s housing shortage,” she said.
The institute’s sharpest criticism was aimed at the federal government’s plan to keep negative gearing for investors who buy new builds. The REIQ argued the policy ignores what drives investor decisions: whole-of-life returns and where policy is heading, not just tax treatment.
Mercorella said the approach assumes investors will simply follow wherever the government has tilted the settings, away from established homes.
“In reality, some may choose not to invest in housing at all,” she said.
She warned that a sustained fall in new construction would put housing targets further out of reach and push up costs for buyers and renters alike.
Mirvac sold 429 homes in the September quarter 2026, down from 619 a year earlier. That is close to a third fewer, according to figures reported by the Australian Financial Review and cited by the REIQ. Stockland’s September quarter update showed 1,506 net residential lot sales, compared with 2,117 a year earlier, with far fewer buyers making inquiries.
Demand for credit is also softening. Australian Bureau of Statistics (ABS) lending indicators show the number of new dwelling loan commitments fell 5.4% nationally in the June quarter. Investor loans were down 8.6%, and Queensland investor lending dropped 10.1%. Over the same quarter, Australia’s residential dwelling stock lost $34.1 billion in value, and the national mean dwelling price slipped by $8,200.
Mercorella attributed the slowdown to rising interest rates, reduced borrowing capacity, and unexpected changes to property taxes.
“We are operating in an environment where uncertainty is high, and buyer confidence is low,” she said.
Unit approvals have also fallen. ABS building approvals data for August 2026 shows approvals for units and other non-house dwellings dropped 21.2% in a single month. The Reserve Bank lifted the cash rate to 4.6% in September, and its board hands down its next decision on 3 November.
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