The ABC reported that only half of the 22,000 homes approved for construction in Western Sydney are proceeding to construction because there are not enough buyers able or willing to pay enough to cover construction costs.
KPMG urban economist Terry Rawnsley warned that interest rate rises would worsen the viability of new apartment projects due to weaker consumer demand for apartments, caused by reduced borrowing capacity, and greater difficulty for developers in securing the finance needed for projects.
A separate report in The Age newspaper reveals that Victoria’s flagship plan to boost housing supply through 60 high‑density activity centres is running into a harsh economic reality: only a small fraction of the proposed homes are financially viable to build.
