QMI: June 2023

“Market conditions remain challenging but there are signs of green shoots as residential land sale volumes rebound from low levels.

A range of factors underpin this improvement including record population growth (underpinned by overseas migration), growing pent-up demand and housing shortages.

The direction of interest rates remains a key factor likely to affect the residential land market going forward.

Although views differ, many commentators suggest the RBA’s monetary policy tightening is (almost) complete.

Importantly, while builders and developers remain cautious about prices, costs, timing and supply, construction cost pressures overall continue to ease.

The steady improvement in the established property market (and rebound in property prices) has also been a factor improving the outlook for the new residential market.

While second home buyers continue to underpin demand, first home buyers continue to face significant pressure due to serviceability and affordability challenges.

The residential land market activity is expected to steadily improve as underlying demand and housing shortages continue to grow.

While challenges remain in the short-term, the medium to long term outlook for the residential land and broader residential property markets is robust.

An active and dynamic residential greenfield market is key to ensuring we can meet housing requirements, both now and in the future, while also ensuring better affordability and delivering the dwelling types needed given current and emerging demographics.”

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Julian Coppini

Chief Executive Officer - Project Marketing