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Aust'n city's high-rise oversupply could lead to 20,000 empty apartments

Xinhua, March 11, 2016 Adjust font size:

More than 21,000 dwellings will be vacant in Melbourne, Australia's second-biggest city, next year due to a massive oversupply of high-rise apartments, according to planning experts.

A report, BIS Shrapnel's 2016 Building Industry Prospects, found the Victorian capital was being overrun by new developments that will ultimately remain empty.

"We are moving into a period where by June 2017, every capital city will have some oversupply other than Sydney," the research group's managing director Robert Mellor said in comments published by Fairfax Media on Friday.

Mellor said that it was obvious this issue would eventually rear its head in Melbourne as there simply wasn't enough renter demand for apartment-style living.

The report came as Melbourne's Lord Mayor, Robert Doyle, blasted construction companies for their "shameful" high-rise housing-project ideas, which he equated to "dog boxes in the sky".

"You know I am pro-development, but some of the developments that have been put before us are shameful," Doyle said on Thursday during a speech at the Urban Development Institute of Australia conference in Adelaide.

"Developments that are three times the recommended height limit: it's not iconic, it's just big."

"Developments that rely on borrowed light: it's not a bedroom, it's a cupboard. These developments are not better for our city and we will not give them planning approval."

Since the Victorian government changed hands in late 2014, new planning minister Richard Wynne has attempted to clamp down on the rampant rise in tower height.

Under the interim density laws, yet to be finalized, developers cannot build past 24 floors unless they provide substantial space offsets.

Mellor said it was time to rein in unchecked upscaling and development. "It's time industry groups move away from the rhetoric of undersupply."

According to the BIS report, the Queensland city of Brisbane is also experiencing an oversupply crisis, while Sydney actually needed another 41,031 dwellings to cope with wild demand. Endit