Brisbane could see 50,000 new inner-city apartments added to skyline, industry expert says
Brisbane could soon see 50,000 units added to its skyline, with demand for inner-city apartment living booming in the capital, industry experts say.
CommSec’s latest State of the States report showed Queensland ranked fourth in the country for dwelling commencements.
Property economist Dr Lyndall Bryant, from the Queensland University of Technology, said much of that was due to an apartment boom in Brisbane.
“Dwelling commencements is both apartments and detached housing that you might have out in the suburbs, but the boom that we’re having at the moment is certainly in the inner-city apartment market,” she said.
Dr Bryant said the number of apartments being built in Brisbane was “staggering”.
“There’s around 10,000 apartments currently under construction in the Brisbane inner-city,” she said.
“There’s another 15,000 that are approved and another 15,000 apartments waiting for approval, and add to that another 8,000 that are mooted.
“Add that all up and that’s just shy of 50,000 apartments that potentially could come onto the Brisbane housing market.”
Bruce Goddard, from Place Projects real estate, said the boom was part of Brisbane’s recovery from the global financial crisis (GFC).
Brisbane is approximately 50 per cent cheaper than Sydney and 35 to 40 per cent cheaper than Melbourne.Bruce Goddard, Place Projects
“Over the GFC there was almost no construction — we had no construction for three or four years,” he said.
“So there’s been a bit of catch up after the financial crisis, and it’s that catch up that is showing high volumes now,” he said.
He said most major residential buildings were going up in West End, South Brisbane, Fortitude Valley and Teneriffe, with young renters increasingly looking to live close to work.
But he said the demand was being strongly driven by high property prices in Sydney and Melbourne.
“Brisbane is approximately 50 per cent cheaper than Sydney and 35 to 40 per cent cheaper than Melbourne,” he said.
“International interest is growing reasonably rapidly, but I think we’re seeing a lot of Melbourne and Sydney buyers because Melbourne and Sydney are so dear.
“We track the differences in values between Brisbane, Sydney and Melbourne, and the difference is now at a record high.”
Mixed reports over possible oversupply in Brisbane
Despite a record number of major residential buildings going up in the city, Mr Goddard said Brisbane was not at risk of having an oversupply of apartments any time soon.
“An oversupply means that there are buildings being built, for which there are no tenants,” he said.
“We are nowhere near that at the moment. As the buildings are being built, there are tenants, so there is good tenant demand, and the tenant demand is driving the buyer demand.”
But Dr Bryant said she believed Brisbane was nearing its saturation point.
“As an industry we need to keep an eye on when the market gets to the saturation point, and I would predict that we are getting very close to point,” she said.
“There’s probably not enough demand to absorb all the supply that is proposed to come onto the market.
“If we meet saturation point, which is when demand sort of equals supply, then hopefully market forces would delay further apartments coming on the market.
“It is really important for the general economy that the property industry remain buoyant.”
By Alle McMahon