WAAA refutes oversupply of apartments
WA’s Apartment Advocacy body has released data this week which refutes claims that there is an apartment glut in Perth.
Based on data publicly released by Urbis in September 2016, there were 3665 apartments under construction with 66% presold. This equates to approximately 1237 available apartments under construction.
However research conducted by WAAA of 53 land subdivisions in October, in locations such as Baldivis, Ellenbrook, Byford, Mandurah and northern suburbs, demonstrated that there was in excess of 1249 blocks currently available for sale.
WAAA Director Samantha Reece stated that it was evident that there was a level of scaremongering occurring within the WA property sector.
“For a long time the dominating offering in WA has been land lots or established homes,” Ms Reece said.
“When apartments began to offer a real threat to the traditional markets there was a knee jerk reaction which sought to undermine this choice, both for investors and owner occupiers.
“However based on the data that we have unearthed, it is quite clear that both land lots and apartments are on par for the volume of availability and hence are reflecting the focus of the State Government to achieve 46% infill.
“As has been clearly seen from recent times, buyers are choosing apartments because they like the locations near community centres and transport as well as the ease of lock and leave and our data is showing that this is becoming more attractive to a growing population.”
A recent poll conducted by the WAAA demonstrated that 93% of people supported apartment living in Perth.
“Buyers need to be conscious that most apartment projects in this current market won’t get banking finance until 60% are presold and hence while there may be 5600 apartments being sold off the plan, these projects will not proceed until they reach this financial target.
“You have to expect that there will be a level of apartment surplus because of the long timeline associated with planning approvals and construction.
“However as with all property, apartments are cyclical and hence key agencies such as Colliers International have stated that within 12-18 months these available apartments will be absorbed and then we will be in a deficit cycle, just like we were in 2013.”