MELBOURNE'S apartment boom is showing no sign of abating, with 65 per cent of all apartment projects launched since 2008 under construction across 30 municipalities, according to Oliver Hume research.
One in five of the projects is in the City of Melbourne or Port Phillip. Oliver Hume's apartment digest to June 30 shows that 25,100 of the 38,400 apartments being marketed across Melbourne are under construction. This covers projects with more than 25 apartments.
Docklands apartments are part of the boom. Photo: Peter Schofield
The report showed that, this year, the total supply of apartments and the number of projects - 296 - were well up on the corresponding period last year, when 262 projects comprised about 28,400 apartments.
However, in the second quarter this year, marketing started for just over 3800 apartments in 38 buildings - comparable in terms of projects, but down on the same period 12 months ago, when 40 projects comprising 5500 apartments came onto the market.
Demand from buyers was showing up in strong presales, Colliers International residential director Tim Storey said. ''Already since January we've sold close to 1600 apartments,'' he said.
But many developers were still struggling to comply with onerous bank restrictions that require up to 70 per cent of presales before funding was considered, Mr Storey said. ''The market's a little wary about what will proceed and what won't.''
Rising building costs and the bank funding restrictions were likely to result in less stock coming on the market over the next year, he said.
Oliver Hume national research manager Andrew Perkins said the average apartment yield per project in the June quarter continued to rise to an average of 143 dwellings. This reflected the larger projects that had been released in the current development period.
The most active apartment market is the City of Melbourne, with 11,000 apartments under construction or 64 per cent of the 17,000 being marketed in the CBD, Docklands and Southbank regions.
The inner-city municipalities of Port Phillip, Yarra and Stonnington are also very active, with a combined 7300 apartments under construction - 81 per cent of the 9000 being marketed. Port Phillip has 1455 under construction from 2263 being marketed (64 per cent), Yarra has 2474 from 3573 being built (69 per cent) and Stonnington has 2360 from 3038 (77 per cent).
The two major non-CBD municipalities close behind are Boroondara, with construction running at 1404 from 2258 (62 per cent) and Moreland, with 1581 from 2185 (72 per cent).
Next is line are Moonee Valley, Monash and Maribyrnong, with 700-1100 apartments under construction. The remaining suburbs account for about 1500 units.
Mr Perkins said the high levels of commencement showed the success of these developments. ''With banks still tight on lending, developers need to secure very high levels of sales before construction can commence," he said. The market was absorbing the new projects at an unprecedented rate.
Source: Sydney Morning Herald
