Brisbane to lead residential construction pick-up as Melbourne and Pilbara region contract: BIS Shrapnel

Brisbane to lead residential construction pick-up as Melbourne and Pilbara region contract: BIS Shrapnel
Larry SchlesingerDecember 7, 2020

A 22% rise in the number of new houses and apartment built is anticipated in Greater Brisbane over the next year.

Almost 3,000 more new dwellings are expected to commence being built over the next 12 months than the previous 12 months, according to forecasts from BIS Shrapnel.

In total, 15,859 new house and apartments are expected to be built in the Greater Brisbane area in 2013/14 compared with 12,963 in 2012/13.

Brisbane will pick up the slack from Melbourne, the now declining, but still the epicentre of new dwelling construction in Australia.

Melbourne dwelling starts are forecast to fall 18% from 38,471 new homes under construction in 2012/13 to 31,423 in 2013/14.

This is still greater - for now - than Sydney, which is forecast to manage a solid 10% growth in residential starts rising from 26,806 dwellings to 29,360.

Much of the new construction in Brisbane will be focused on apartments projects in the inner city with hotspotting.com.au’s Terry Ryder writing earlier this month that two new reports by Place Advisory and Colliers International confirm that off-the-plan sales in the March quarter were the highest since September 2004, boosted by the release of six new projects.

Place Advisory records 625 off-the-plan sales in inner Brisbane in the March quarter – double the number in the December 2012 quarter, 40% up on the same quarter last year.

In Queensland, the pick-up in residential building is not confined to the capital city, with a number of lifestyle locations such as Wide Bay and Toowoomba, a property investment hotspot, also included in the Top 20 residential building growth markets.

dwellings_up

 


"The Wide Bay region lies just above the Sunshine Coast and includes the major regional cities of Bundaberg, Gympie, Hervey Bay and Maryborough. The region is a lifestyle location with tourism being a key industry in the local economy,” says Kim Hawtrey, associate Director of BIS Shrapnel.

“We expect continued strong economic activity to drive a pick up in home construction in regions such as Wide Bay (forecast to be up 16%) and Toowoomba (up 12%) in 2013/14 and beyond.”

Greater Brisbane ranks 10th overall among residential building hotspots over the next 12 months, but is by far the biggest market in the top 20.

Other notable larger markets expected to experience strong growth in residential dwelling construction include Bunbury in WA (up 27%) and Newcastle and Lake Macquarie (up 19%).

The pick-up in Bunbury, the Wheat Belt (forecast to grow by 29%), Esperance (+27%) are part of a building focus shift “strongly towards the southern half of the state, especially the south west corner”.

“Bunbury, Esperance and the Wheat Belt cover the south-west corner of the state, including the Margaret River wine region and Manjimup,” says Hawtrey. “The area includes a number of manufacturing operations as well as a local tourism industry and a lifestyle component of demand. A new rail link to Mandurah is promising to open up the region.”

By comparison, the resources-rich Pilbara region is set to undergo a significant residential building correction as the mining investment boom peaks with a forecast 36% drop in dwelling commencements in 2013/14.

dwellings_down

Other towns tied to mining that are expected to undergo a residential construction slowdown include the Kimberley region (-22%), Greater Darwin (-12%) and Mackay (-8%) in Queensland.

While a relatively tiny market by comparison to Brisbane and Sydney, Coffs Harbour will undergo a mini-residential building boom with a forecast 52% rise in dwelling commencements over the next 12 months.

“Coffs Harbour-Grafton hugs the coast towards the north of New South Wales, sandwiched between Richmond-Tweed and the Mid-North Coast. It has an older age profile, with a median age of 44 compared to 38 across the state as a whole, and has a significant lifestyle and retiree component to demand,” says Hawtrey.

 

Larry Schlesinger

Larry Schlesinger was a property writer at Property Observer

Editor's Picks