Over the last twelve months, a quarter of a million new dwellings started construction across Australia. This is an historic record and this level of new building activity continues despite: falling population growth, increasing household size, concerns around jobs growth, falling economic activity, lacklustre investor sentiment and falling real demand for housing.

It is pretty simple: the new housing market in Australia is going to go into a period of downturn due to oversupply!

Some Facts:

· The increasing unaffordability for a majority of Australians,

· Across the nation we are overbuilding,

· Too much of the wrong stock. Is being built,

· There is a need for more apartments, in smaller complexes across our middle and even outer suburbs,

· There is a need for more townhouses, and dual occupancy homes,

· A growing belief that apartments are now too risky to investment in,

· Not enough incentive to investment in the lower cost investment properties,

· Record low interest rates have provided strong motivation to invest

It appears that nationally that new housing starts are at or very close to their peak. Here in Australia, we are now building too many new homes. Whilst there is a mismatch between the type of new dwellings being built and what the market needs are, the next stage of the new housing building cycle will be much more difficult.

Investors should be doing much more research to ensure that the projects in which they are interested, will remain viable in the future. Obvious different cities, towns and regional will all perform differently and the absorption of excess stock will be dependent on local factors. This harps back to the need to have done thorough research.

“In preparing in this article we have not taken into account any particular persons objectives, financial situation or needs. Investors should, before acting on this information, consider the appropriateness of this information having regard to their personal objectives, financial situation or needs. We recommend investors obtain financial advice specific to their situation before making any financial investment or insurance decision.”