SEQ demand is outpacing supply amid rising challenges

The SEQ housing market continues to grapple with intense demand, fuelled by rapid population growth and heightened investor interest. As 2024 winds down, the supply shortage remains a pressing issue. Despite government efforts to accelerate housing delivery, progress has been minimal as building approvals stagnate and lot registrations fall short of SEQRP targets. 

Shifting Approval Trends 

The housing landscape presents mixed signals. While house and townhouse approvals climbed by 9% and 5% respectively, apartment approvals fell by 11%. Rising construction costs and a limited pool of building firms have compounded the challenges for high-rise developments, many of which remain stuck in the planning stage. Although current government policies prioritise high-density housing, escalating costs stifle progress.

One standout in navigating these barriers is Walker Corporation, advancing Build-to-Sell (BTS) apartment projects to help meet SEQ’s growing housing needs. 

Investor Activity & Affordability Challenges 

Investor activity surged by 24%, making Queensland a more attractive investment hub than Victoria, where SEQ commands a larger share of new loans. However, the affordability crisis continues to affect first-home buyers disproportionately. Analysis reveals that households earning SEQ’s median income of $101,887 can only afford 7% of houses and 23% of units — and these figures are even lower for families with children. Without interest rate cuts or changes to lending regulations, affordability will likely erode further. 

First-Home Buyers & Land Scarcity 

The doubling of Queensland’s First Homeowner Grant to $30,000 has sparked modest first-home buyer activity, although it remains below the levels seen during the low-interest era. The recent scrapping of stamp duty may further encourage first-home buyers, who are increasingly targeting more affordable areas like Logan-Beaudesert. 

Meanwhile, land demand remains high, with less than a month’s stock available in key greenfield markets such as Ipswich, Moreton Bay, and Logan. This scarcity has pushed the median price of settled land up by 19% to $427,000 for a typical 455sqm lot. Developers are now responding with more compact lots, catering to buyers seeking properties priced under $650,000. 

Possible solutions for Sustainable Growth 

To bridge affordability and supply gaps, Queensland can look to Victoria’s planning framework for inspiration. The Small Lot Housing Code (SLHC), which removes the need for permits on lots under 300sqm, has proven effective. Additionally, prioritising infrastructure development to unlock more land and improve connectivity in greenfield communities could expedite housing delivery and enhance livability. By adopting these strategies, SEQ can better address its housing challenges and pave the way for more affordable, accessible living solutions. 

This article references findings from our November 2024 South East Queensland Greenfield Market Report. Read the full report here.