The Year Ahead for Developers: Innovation and Resilience


Australia’s residential property market is forever changing and adapting to market influences. After more than five years of strong property growth, dwelling prices are beginning to neutralise.

In the context of a softening market, with changing buyer profiles and liquidity constraints, developers are needing to be more agile than ever.

The Urban Developer​ interviewed Dr. Nicola Powell, ​Domain’s​ Data Scientist.

Dr Powell reveals that while the resilience of the development market will be tested in the second half of 2018, favourable demographic trends will support demand.

Dr Powell also highlights the fact that developers who innovate to match changing market trends are likely to stay at the top of the market.

TUD: What are some interesting trends you have seen this year and how does this affect developers?

NP: ​In the first half of 2018, it has been clear that there is a strong relationship between credit availability and price appreciation.

Restricted credit availability will cause the market to subdue. During this time developers will need to be resilient and will also need to appreciate that a changing market brings about an exciting opportunity for innovation and adaptation.

This is relevant wherever developers are at in their journey – those who are actively selling may see a shift in their target market, or those who are designing and planning their next development may consider a reconfiguration of apartment size and layout to meet changing market demands.

West Village, West End QLD - Sekisui House
West Village, West End QLD - Sekisui House

TUD: What major influences do you think will impact the property market in the remainder of 2018?

NP:​ The biggest influence will likely be the most topical news story at the moment – The Banking Royal Commission. The Royal Commission may result in tighter regulatory controls and lending standards which will have a roll on effect to cause national prices to neutralise.

TUD: What tips can developers employ to remain ahead of the game for 2018 and beyond?

NP: ​Demand for developments will vary depending on the city, submarket location, type and quality of the development offering.

There is a growing need for owner-occupier targeted buildings that can meet the needs of growing families and for developments that are in close proximity to major infrastructure hubs.

A less manic-time in the property housing market will allow for developers to reflect on their experiences and learnings in an extremely hot market and adapt to changing market needs accordingly.

Brisbane has taken the lead in responding to market demand by shifting towards boutique, owner occupier developments, as opposed to high-rise cookie cutter residential developments.

TUD: What are the key points developers need to consider to future-proof their developments for the remainder of 2018?

NP:​ When planning for future developments, developers will need to take an innovative and well-researched approach to the location and specification of their development.

Population growth and potential housing stress will mean affordability constraints will continue to be in the spotlight. This can result in a drive for demand for developments designed specifically for the owner-occupier.

Boutique development offerings that meet the needs of growing families and those that are well connected to major infrastructure hubs are also likely to perform well.

Are you looking for an innovative way to talk to your market?

Let Domain help you connect with buyers.

Contact ​​ or visit​.

Main Image: Elision, Kew VIC - Dynamic Residential

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