Demand for apartments in Australia will stay strong particularly in cities with growing populations. Hence the need for building supplies will remains stable.
Developers need to invest in quality materials even if it’s only an aluminium door jamb, especially if they plan to build apartments in Sydney where the state government recently imposed a building bond to cover possible defects.
Property experts believe that Sydney’s apartment market will have more than 8,900 of completed properties in 2018. By next year, it will decline to almost 6,470, yet a denser population will likely spur the need for more buildings by 2020.
In other cities like Melbourne, the number of apartment completions has no significant impact on the market. Despite peaking at more than 10,400 in 2017, the demand for multifamily housing will help in appeasing concerns about a glut in supply. However, that doesn’t mean buyers will be willing to snap up properties without doing proper inspections.
Builders need to be aware that apartment investors and buyers check for building defects first and foremost, before even considering a potential purchase. Even if you already contracted an independent building inspector, some buyers would still hire their preferred investigator to check for potential issues.
In New South Wales, property developers are now required to pay a building bond worth 2 per cent of the total contract value. Once a building passes the inspection, the amount will be returned after two years. While projects outside the state are not required to pay a bond, buyers still pay attention to other factors such as natural lighting and efficient floor plans during the decision-making process.
Even if the apartment market shows some volatility in the next two years, the fact remains that people will need shelter. It’s up to developers on how they plan to build properties that cater to their target market’s preferences.