Mixed-use development demand shows uptick in 2021: Five minutes with James Sialepis, Meriton's director of residential sales
As we near the end of 2021, Urban reached out to glean some insights on the apartment market and what's in store over the next couple of years from Meriton's perspective.
We asked a few questions of James Sialepis, Meriton's director of residential sales, has been with the apartment developer for more than two decades.
JC: How have you viewed the performance of the off the plan market in 2021, and what are the strongest positive and negative factors that will influence outcomes in 2022 and 2023?
JS: The off the plan market has performed reasonably well throughout 2021 underpinned by a lack of supply, returning investors and owners looking to combine apartments.
The local investor market which traditionally prefers “Brand new” off the plan apartments (due to the higher depreciation benefits compared to second hand) has improved recently as rents continue to rebound and vacancy rates recover to pre-pandemic levels but overseas buyers continue to fall, which now contribute a very small % of total sales.
The recent announcement by the Federal Government to open international borders to eligible visa holders allowing migrant and students into the country should see continued demand grow for both sales and leasing.
JC: What trend has prompted your greatest enthusiasm for the apartment market? And what is the issue of most concern to you and or your buyers?
JS: Purchasers are definitely more attracted to mixed-use developments which include retail precincts, childcare centres and leisure facilities amongst residential.
More owner occupier demand from growing families is definitely exciting for Meriton. Our aim has always been to offer an experience to residents that is attractive, convenient and unique.
Families are attracted to a low level of maintenance and to the amenities within each of the developments such as parklands BBQ areas and playgrounds.
Enquiry and sales for three and four bedroom apartments has increased YOY and we expect this trend to continue.
Rising interest rates or further macro prudential measures could dampen enthusiasm very quickly.
In early 2019, through some heavy hitting macro prudential measures, lenders were forced to curb their lending practices which restricted the flow of finance into housing.
Similar measures will have the same impact, but this time they could be coupled with rising interest rates which would be more dangerous.
JC: Has urbanisation stalled amid the rush to the regions and what will it look like over the decade ahead?
JS: COVID posed many questions and the extended lockdowns were an opportunity for many to reassess their housing needs.
For some it was whether or not they should stay in Sydney or move into the regions but for many it was just a slight readjustment.
The readjustment included demand for apartments with study areas, extra space for a growing family and the need for better amenity within a development.