I came across an interesting statistic a short while ago.
Amidst all the talk of a housing shortage Bureau of Statistics figures show that 123,500 new dwellings have been approved in Australia since July.
But when you look closer at what is happening in Melbourne the trend has changed from building houses and now virtually half the new dwellings approved this financial year are high and medium-density apartments and units. In fact more than 20,000 high-rise and medium-rise apartments approved in the past two years. And most are in or around the CBD.
This is a concern as this will create too many apartments creating a glut in and around the Melbourne CBD. With many of these apartments being bought by investors off the plan, some investors are sure to lose out.
However not all the apartments that have obtained approval will be built. Some won’t get finance and others won’t have sufficient levels of pre sales to allow the development to proceed.
times developers cannot obtain the finance they need. Sometimes the approval is speculative, with the owner aiming to resell the land, and permit, to a genuine developer.
As Melbourne matures, these new apartments are changing the shape of the a city.
In the 1990s, just 5% of new dwellings approved in Victoria were in high rise buildings. So far in 2010-11% are in high rise buildings with another 15% in low-rise apartment blocks or medium-density developments.
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