Apartment supply will be at crisis levels by 2024, with 30,000 direct jobs lost across the sector, warns the Property Council, following fresh analysis from Urbis.
Three key takeaways:
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“Apartment construction is a critical component of Australia’s future housing supply and a vital job-creator for our economy,” says Property Council chief executive, Ken Morrison.
“While approval numbers are increasing, they mask a decline in construction activity that will lead us to a severe structural undersupply by 2024.”
The report, prepared by Urbis on behalf of the Property Council, finds government actions over time have led to a reduction in investment that predates the closure of international borders.
Welcome stimulus in the detached housing sector, such as HomeBuilder, and modest apartment stimulus efforts by some state governments have not moved the dial for apartments.
“Over recent years we’ve seen a proliferation of new taxes and regulations across Australia that have been a handbrake on investment and directly impacted our levels of apartment supply,” Morrison says.
The report outlines actions for government to avert job losses in the apartment sector, including:
- Provide relief from foreign buyer surcharges
- Accelerate planning approvals
- Extend off-the-plan apartment stamp duty concessions
- Remove land tax barriers to build to rent projects, and
- Abandon Victoria’s new “Windfall Gains Tax.”
Apartments take between three and five years to complete from project inception, making it “imperative” that governments act now to boost apartment investment and avoid a supply crunch in 2024, Morrison adds.
“This is a wake-up call for governments as our biggest apartment markets will welcome growing numbers of people once COVIDsafe immigration inevitably returns.”
Read the Property Council’s Jobs and Homes report, prepared by Urbis.