The top 25 areas set to see an abundance of new units

30 AUG 2018 By Sasha Karen 11 min read Hotspots

Data from CoreLogic reveals the top 25 areas that have the highest number of new units in the pipeline across the country. Here’s why investors should be paying attention.

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Oversupply is something any smart property investor should keep an eye out for, as this can push prices down.

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The latest Property Pulse from CoreLogic analyses the influx of increased unit numbers over the next two years and what that means.

Over the next year, 94,471 new units are planned to be completed nationwide, an increase of units by 3.5 per cent. Looking over the next two years, 251,751 units are expected to be completed, an increase of 9.3 per cent.

In terms of capital city areas, the two most populated capital cities are expected to see the highest increase of unit supply over the next two years, with Melbourne in the lead at 78,689 and Sydney in second place with 76,977, while Brisbane is expected to see the greatest percentage increase at 18.4 per cent, followed by Adelaide at 12.5 per cent.

Looking into the capital cities, out of the top 25 regions for unit supply over the next two years, the inner Brisbane region is expected to see the most units over the next two years, but the north of Blacktown in NSW is expected to see the biggest percentage increase, rising by 52.8 per cent over the next year and 128.1 per cent over the next two years.

Analyisng the data, CoreLogic research analyst Cameron Kusher said while the past five years have shown a significant increase in unit supply, the property market has deteriorated with falling values and rental growth, and conditions in Melbourne and Sydney could deteriorate even further and Brisbane to a lesser extent.

“Considering that dwelling values have generally trended lower over the past twelve months, buyers who have purchased a unit ‘off the plan’ may find the unit value at the time of settlement is lower than what they may have expected at the time of signing the contract,” Mr Kusher said.

In some cases, the settlement value may be lower than the contract price, implying buyers may need to top up their deposit in order to meet their lenders loan to valuation requirements.”

The top 25 regions for new unit completions over the next two years according to CoreLogic are:

Region

Total units

Potential new units next year

Potential new units next two years

Expected increase next year (as a percentage)

Expected increase next two years (as a percentage)

Brisbane Inner Qld

32,804

2,996

9,732

9.1%

29.7%

Melbourne City Vic

99,263

3,167

8,040

3.2%

8.1%

Sydney Inner City NSW

117,944

3,257

7,202

2.8%

6.1%

Parramatta NSW

36,912

2,525

5,996

6.8%

16.2%

Whitehorse - West Vic

19,347

839

4,659

4.3%

24.1%

Ryde - Hunters Hill NSW

31,236

1,646

4,460

5.3%

14.3%

Strathfield - Burwood - Ashfield NSW

40,932

1,837

4,116

4.5%

10.1%

Blacktown - North NSW

3,080

1,627

3,945

52.8%

128.1%

Perth City WA

40,100

1,906

3,807

4.8%

9.5%

Yarra Vic

29,983

1,155

3,598

3.9%

12.0%

Maribyrnong Vic

17,402

1,282

3,532

7.4%

20.3%

Dandenong Vic

24,836

1,576

3,518

6.3%

14.2%

Penrith NSW

10,727

1,184

3,340

11.0%

31.1%

Canterbury NSW

24,674

1,969

3,339

8.0%

13.5%

Glen Eira Vic

36,182

1,660

3,319

4.6%

9.2%

Auburn NSW

22,486

1,109

3,271

4.9%

14.5%

Monash Vic

23,557

903

3,216

3.8%

13.7%

Darebin - North Vic

16,519

826

3,154

5.0%

19.1%

Essendon Vic

16,726

1,278

3,018

7.6%

18.0%

Holland Park - Yeronga Qld

13,316

1,191

2,889

8.9%

21.7%

Port Phillip Vic

49,384

1,057

2,862

2.1%

5.8%

Boroondara Vic

34,927

1,053

2,816

3.0%

8.1%

Brunswick - Coburg Vic

21,844

1,129

2,799

5.2%

12.8%

Merrylands - Guildford NSW

14,886

862

2,789

5.8%

18.7%

Brisbane Inner - North Qld

23,485

968

2,757

4.1%

11.7%

 

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