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Following article courtesy of The Urban Developer …
The Australian economy has performed consistently in 2018, seeing growth in infrastructure investment and reduced unemployment levels, but indicators point to weaker conditions this year.
CBRE’s Australia real estate market report suggests the nation’s economic outlook is still growing in 2019, but slowing.
“Our forecast is that GDP growth in Australia will decrease from three per cent in 2018 to 2.4 per cent in 2019,” the outlook notes, led by the industrial sector which has begun to cool.
CBRE head of research Australia Bradley Speers said the slowing economy presents both threats and opportunities in the residential market.
Property development
Developers are facing higher hurdles in obtaining finance from traditional sources.
“The eventual impacts on site values may prove to be even more significant than headline price correction for built product,” the outlook warns.
Australian banks will continue to be more stringent in lending on residential developments and commercial property deemed “higher risk”.
“This will present opportunities for alternative lending sources, with the Australian banks’ share of lending within commercial property expected to decline this year,” Speers said.
“Particularly in sub-regional and large format shopping centres, and residential developments across Australia.”
