Property Council calls for action on looming apartment crisis

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Thursday 18 April 2024


Property Council calls for action on looming apartment crisis

The Property Council of Australia’s Queensland Division has joined the chorus of industry bodies calling for action on Brisbane’s apartment supply crisis.

Independent research commissioned by the Property Council of Australia shows that without government intervention Brisbane’s apartment supply will plummet.

This research raises serious concerns over the future of Brisbane’s apartment stock and shows the Brisbane apartment market is heading for a cliff, with projects under construction in Brisbane set to drop to zero after 2025.

As costs skyrocket and productivity levels spiral further, intervention is desperately needed – this starts with removing the tax and regulatory barriers to delivering a home for every Queenslander.
Brisbane’s development pipeline has become so constrained that less than 2,000 apartments were delivered each year between 2020 and 2023.

A little under 3,000 apartments are under construction in Brisbane in 2024 – this is set to drop to less than 1,500 in 2025.

The Property Council’s Queensland Executive Director Jess Caire said that with the current construction challenges impacting Queensland there was no guarantee the projects already under construction would be completed.

“If all the projects under construction proceed it will only bring 4,356 dwellings to market, well short of the 7,500 attached dwellings needed for Brisbane each year according to the government’s South East Queensland Regional Plan,” Ms Caire said.

“This is deeply concerning, particularly given the state government’s focus on infill to solve our housing woes.”

Focussed on inner Brisbane, the Property Council research supports data released earlier this week from the Urban Development Institute of Australia – together both pieces of research paint a very grim picture about the future apartment pipeline.

“These projects take years to come out of the ground.

“Navigating planning frameworks and securing pre-sales and complex funding arrangements, all while navigating the minefield of complicated and costly taxation settings takes year and all has to be done before any ground is broken.

“Getting the tax settings on the front-end right would alleviate some of the cost pressures and encourage further investment in Queensland’s future.

“Abandoning prohibitive foreign investor taxes that continue to drive developers with a proportion of foreign ownership out of Queensland would go far. Encouraging this investment to locate their capital in Queensland will help kick-start much-needed new apartment projects.

“These taxes add to the cost to development further challenging the feasibility of projects whilst driving out investment – regardless of how it’s sold to the public – the truth is simple, it’s a housing tax.

Ms Caire said the Property Council of Australia stood ready to work with the government to identify ways to correct the decline in apartment projects, including supporting the important build-to-rent sector.

“Given the large portion of Build-to-rent asset in the speculative pipeline it makes perfect sense to broaden the limited land tax concessions on offer to further support this emergent asset type – it would certainly see many these apartments come out of the ground.

“Further introducing off-the-plan stamp duty concessions for buyers who choose to enter into contracts for apartments, will increase the pre-sales that are key in turning speculative supply into completed projects and roofs over people’s heads,” Ms Caire said.

The report can be found here.


Media contact: Matthew Johnson | 0447 667 502 | [email protected]