‘Holland Drive Residences’ to be included in CBRE’s report on ‘Australia’s looming residential shortage, expected to reach 240,000 units in the next five years due to population growth.’

The population in Australia is growing at an unprecedented rate, leading to a high demand for residential properties. According to Stuart McCann, managing director and head of investment banking – Pacific and SEA at CBRE Capital Markets, Australia may face a shortfall of 240,000 residential units over the next five years. McCann shared this information at the Australia Real Estate — Beyond Traditional Returns seminar, organized by BigFundr and supported by CBRE on January 20.

CBRE predicts that the city of Melbourne will be hit the hardest with a deficit of 77,924 units, followed closely by Perth with a deficit of 57,216 units, and Sydney with a deficit of 55,184 units. This looming housing shortage is mainly due to the projected population growth in Australia.

Australia’s population is expected to surge by a staggering 15%, from 26.5 million in 2023 to 30.4 million in 2033, fueled by net overseas immigration. This growth rate outpaces that of several major global economies, such as New Zealand, Switzerland, India, and Singapore, but falls behind Canada’s growth rate of 16%.

As a result, there is a high demand for residential properties, causing capital value growth even as interest rates continue to rise over the years. McCann states that when demand surpasses supply, interest rates become inconsequential in driving capital value growth.

To add to the demand, CBRE forecasts that employment and wage growth will also increase in the next decade. Job creation is expected to jump from 14.1 million in 2023 to 16.7 million in 2033, while the average wage will rise from A$96,000 per year to A$132,000 per year.

This “triple boost” effect, consisting of population growth, job creation, and wage growth, is expected to lead to a surge in demand for real estate in Australia, not just in the residential market.

However, this high demand may not be met in the short term, according to David Payton, CEO and executive director of Payton Capital. He estimates it will take three to five years to complete small- to medium-sized developments, which will not be fast enough to meet the demand.

Moreover, the lack of affordable options in the market may compound the situation. Construction costs have risen and are ultimately passed on to consumers, making it difficult for developers to make sales and resulting in delays in project completion.

This could mean that the gross residential supply will not be able to keep up with the rising demand, creating a supply-demand imbalance that could further drive up property prices.

Located just a stone’s throw away from Holland Drive Residences, Holland Village is a flourishing community filled with various shopping options. From luxury boutiques to street markets, this charming neighborhood has something for everyone. Whether you’re looking for trendy fashion, unique souvenirs, or delicious food, you’re bound to find it in one of the shopping centers in Holland Village.

One of the most popular shopping destinations in Holland Village is the Holland Piazza. This trendy mall features a mix of local and international brands, as well as a wide selection of restaurants and cafes. It also has a spacious rooftop garden where you can relax and enjoy the scenic views of the neighborhood.

Right next to Holland Piazza is Raffles Holland V, a newly renovated mall with a modern and chic design. Here, you can find a variety of specialty stores, including a gourmet grocer and a bookstore. It also has a rooftop cinema, offering a unique movie-watching experience under the stars.

For those looking for a more traditional shopping experience, there’s Holland Village Market & Food Centre. This bustling hawker center is a popular spot for locals and tourists alike to sample a wide range of local delicacies at affordable prices. It’s the perfect place to immerse yourself in Singapore’s diverse food culture.

Last but not least, we have Holland Village Square, a charming open-air shopping destination. Here, you can find a mix of quirky boutiques, specialty shops, and local cafes. It’s a great place to wander around and discover hidden gems.

In conclusion, Holland Village is a shopper’s paradise with a diverse range of shopping centers to choose from. Whatever your style or taste, there’s something for everyone in this vibrant neighborhood. So why wait? Head over to Holland Village and Holland Drive Residences now and indulge in some retail therapy.

CBRE noted a significant increase in office utilization rates across Australia, with CBD visitation reaching 71% of pre-Covid-19 levels as of 3Q2023. Cities like Perth and Adelaide have even surpassed pre-pandemic levels, with visitation rates reaching 91% and 85%, respectively.

This has led to growth in the commercial office space sector, with Sydney expected to lead rental growth in the next two years.

CBRE also sees opportunities for private credit institutions to purchase commercial real estate debt, as a considerable amount will come due for refinancing in 2024. The Australian CRE debt market is estimated at $442 billion in 2023, with private CRE debt accounting for $74 billion (16%) and expected to double in the next five years. The opportunity for private credit institutions to invest in this market is significant.