JLL has reported that the number of inner-city apartments completed during the past 12 months across capital city markets fell by 21% to be 30% below its 2017 peak, while the number of apartments under construction fell by 18%. The volume of apartments being marketed has also tumbled by 47%:
JLL’s Australian head of residential research Leigh Warner said that, despite the growing confidence, developers were still doing it tough.
“Developers are looking to position themselves for the next cycle, but the reality is that it remains tough to get projects started at present,” he said.
“Presales are slow, partly because investor demand hasn’t bounced back as strongly as owner-occupier demand, but also because the unsold residual stock in a number of areas that are heavily discounted are competing with the sales of new projects.
“The result of continued slow pre-sales is that few new projects will commence in the short term, supply will keep falling for some time and most markets will move into a position of undersupply over the next few years.”
The ABS’ high-rise approvals data echoes this analysis, with high-rise approvals down 51% from their October 2015 peak:
This is further confirmation that dwelling construction is facing an epic bust. And this will decimate construction jobs, which hit an all-time high 1.2 million (9.2% of workforce) in the November quarter: