The past few years have posed significant challenges for the Australian building industry. The government's monetary policies, particularly during the virus period, led to high inflation, causing a ripple effect in the building market. The resultant unprecedented cost increases and the necessity to adhere to fixed-price contracts pushed numerous builders into liquidation, leaving many customers with partially completed homes that required building insurance for rectification.
Fast Forward to the Present
Currently, the property market is on the path to recovery. Builders on the brink of liquidation have faced their fate, and the industry is gradually returning to normalcy. Building prices have slightly eased, and construction times have reverted to standard schedules.
Amidst the aftermath, savvy investors are recognizing a unique opportunity that has emerged from the turmoil.
Australia is currently facing a significant housing demand, with the market significantly undersupplied. Adding to the complexity, there's a dearth of new supply entering the market. Although building prices have stabilised, and construction timelines have normalised, there exists a lingering apprehension among potential homeowners. The tales of construction woes have instilled fear, causing a drop in the demand for building services, consequently lowering the value of developed land.
Surprisingly, it has now become more economical to acquire land and embark on a construction project than to purchase an existing property.
Investors, attuned to market dynamics, are realising the potential for substantial profits by navigating the building process. The current scenario presents an opportune moment for those considering property development. However, cautiousness remains paramount.
Prospective building clients should exercise due diligence and scrutinise potential builders for financial viability. Ensuring adequate coverage is in place is also crucial. For a comprehensive checklist to guide you through this process, feel free to book a call with Cameron Bird Property Group here.
Conclusion
In conclusion, the landscape is favourable for those considering new builds as a means of enhancing property equity. The market has stabilised, creating a secure environment for construction projects.
Nevertheless, prudence dictates that thorough research and vigilance be exercised throughout the process. It's a new era for the Australian property market, and strategic investors are poised to capitalize on the emerging opportunities.
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