Builds not matching approvals

35,000 units ready to start

ALMOST 35,000 units have been approved but not built on the Gold Coast despite the city’s spiralling housing crisis.

State government figures show that at the end of the last financial year, 691 permits for “multiple dwelling” developments had been “approved and as yet unconstructed”.

If built, those development approvals would yield as many as 34,452 units.

Building industry sources said rising costs, labour shortages and delays caused by Covid and wet weather were some of the factors contributing to development lag on the Gold Coast.

“The industry is going as hard as it can, it’s just impossible for us to do any more,” Housing Industry Association regional executive director for Queensland Mike Roberts said.

“The number of commencements across the country is at a record high. We’ve started more projects than we’ve ever started before.

“But the number of completions hasn’t risen to match that number of commencements.

“The number of completions is flatlining.

“And it’s because of constraints on labour and materials. We just can’t build things as quickly as we normally would.”

Mr Roberts said project times had blown out, which – combined with rapidly rising costs – made it difficult for builders to accurately plan ahead.

This in turn caused difficulties for developers when they sought finance from lenders.

“It’s extraordinarily difficult for anybody to schedule work in the way they normally would because the materials are taking three, four, five times longer to be delivered than they normally would. To try and schedule work and to make sure the labour’s on site and ready to go when those materials are delivered is really difficult.

“It’s a pretty common practice these days for developers, in discussions with their financiers, to have a percentage of presales before the bank will sign off on the project and they can begin construction.”

The problems getting developments off the ground have come despite house and unit prices on the Gold Coast soaring to new highs of $1.07m and $654,000 respectively, while the rental vacancy rate in the city has fallen to a record low of 0.4 per cent.

In March, the Bulletin reported that the Gold Coast property sector was banking on more than 2500 units across 20 new tower projects hitting the market in the next three months to ease the city’s apartment shortage.

The lack of available units had not eased in the past three months, according to an apartment essentials report by property consulting firm Urbis, and just 2.3 months of supply remained if new projects were not launched.

Council planning chair Cameron Caldwell said the city had received a record number of development applications, which should allow developers ultimately to meet demand.

“In the past 12 months, we have had the strongest year of development application activity we have ever seen, which gives developers the opportunity to take new product to the market to meet demand,” he said.

“The market demand, if it continues, will provide positive economic settings for developers to go ahead with their approvals.”