Australian Apartment Market Overview Q4 2024

The apartment market for new-builds remains divergent. While investor demand is gradually increasing, it remains subdued and is keeping the advancement of larger high-density developments limited. In contrast, luxury boutique apartment projects are still seeing robust demand across most markets, predominantly from downsizers less impacted by current higher interest rates.

The mismatch between new apartment construction and underlying demand levels remains a significant medium-term concern and under-supply levels are likely to grow. Despite a growing appetite among developers to address this shortfall, the reality is it remains a difficult development environment for large scale apartment projects and, while the worst is likely over it, it will take some time for supply to ramp up again.