Why almost all of Brisbane’s new apartment builds are ‘luxury’ – ABC News

Luxury Apartment Market in Brisbane and Sustainable Development Goals

Current Market Overview

In Brisbane, nearly all off-the-plan apartments available this month are marketed as “refined,” “elevated,” or “boutique,” emphasizing luxury. Prices range from $700,000 for a one-bedroom, one-bathroom apartment on the northside to $11,050,000 for a four-bedroom, four-bathroom riverfront apartment.

Ray White chief economist Nerida Conisbee highlighted that while demand for affordable apartments exists, rising construction costs have shifted developer focus towards high-end builds.

Impact of Construction and Labour Costs

According to ABS data, construction material prices have increased by 35.5% since the COVID-19 pandemic. This inflation has made affordable apartment construction challenging, while luxury apartments remain economically viable.

“It is really hard for developers now to build affordable apartments, but it is, and conversely, it’s a lot easier for them to build much more expensive apartments,” said Ms. Conisbee.

Developers face difficulties building apartments priced around $750,000 due to increased costs, often needing to price them at $900,000 or higher. Luxury apartment buyers are less price sensitive, allowing developers to align prices with construction costs.

Labour Shortages and the 2032 Olympics

Labour availability is another critical factor affecting construction costs. Analysis by WT Partners projects a shortage of 46,000 construction workers in Queensland by the 2028/29 financial year. The upcoming 2032 Olympics further intensify labour demand, diverting workers from housing projects.

VERSO CEO Steve Laffey noted that government projects are often more attractive to labourers due to simpler client relationships compared to multi-unit residential developments.

Economist Cameron Murray explained that construction worker wages have risen due to high demand for their skills, though this trend may normalize as more workers enter the industry.

The Queensland Productivity Commission has reviewed construction industry productivity to improve workforce outcomes and support housing and infrastructure delivery.

Buyer Demographics and Market Demand

Downsizers and Investors Driving Demand

Despite high prices, demand remains strong, primarily from downsizing baby boomers and investors. Boutique developments, such as the 52-unit project in Lutwyche by Jadecorp, attract owner-occupiers seeking long-term homes with high-quality design and finishes.

“We’re seeing a real shift that apartments are no longer a stepping stone for housing,” said Alexi Dracakis, Jadecorp manager.

In Q2 2025, 56% of buyers in inner Brisbane projects under construction or pre-sale were owner-occupiers, according to the Urbis Apartment Essentials National Snapshot report.

Luxury Amenities and Affordability Challenges

• Many new apartments feature luxury amenities such as pools, saunas, and gyms.
• These amenities increase body corporate fees, which are more affordable for retirees and wealthier buyers but may be prohibitive for buyers of affordable apartments.

Cameron Murray noted that Australia’s wealthy population influences the market, with developers responding to demand for luxury apartments.

Strategies for Enhancing Housing Affordability

Government Initiatives and Market Corrections

To improve housing affordability, government involvement in housing construction is essential. The state LNP has pledged to build one million new homes, including 53,000 social and affordable homes, by 2044.

Deputy Premier Jarrod Bleijie highlighted the Residential Activation Fund’s success in unlocking land for 98,000 homes, aiming to increase housing supply and reduce property prices.

Economist Cameron Murray anticipates a market correction that will make housing more affordable in the near future.

Challenges and Developer Perspectives

Alexi Dracakis emphasized the need to expand the construction workforce, improve productivity, and streamline planning approvals to meet housing supply demands.

Steve Laffey acknowledged the private sector’s role in housing affordability but stressed the importance of profitability and shared responsibility across stakeholders.

Alignment with Sustainable Development Goals (SDGs)

1. SDG 11: Sustainable Cities and Communities
   • Encouraging urban densification through boutique and luxury apartments promotes efficient land use and sustainable urban growth.
   • Government programs like the Residential Activation Fund support the development of diverse housing types, enhancing community inclusivity.
2. SDG 8: Decent Work and Economic Growth
   • Addressing labour shortages and improving construction industry productivity aligns with promoting sustained, inclusive economic growth and decent work.
   • Investment in workforce training can stabilize construction wages and support industry sustainability.
3. SDG 9: Industry, Innovation, and Infrastructure
   • Innovations in construction and streamlined planning processes contribute to resilient infrastructure and sustainable industrialization.
4. SDG 1: No Poverty and SDG 10: Reduced Inequalities
   • Government-led affordable housing initiatives aim to reduce inequalities by providing accessible housing options for lower-income groups.
   • Balancing luxury developments with affordable housing is crucial to ensuring equitable urban development.

Conclusion

The Brisbane apartment market is currently dominated by luxury developments driven by rising construction and labour costs, alongside strong demand from downsizers and investors. To achieve the Sustainable Development Goals related to sustainable cities, decent work, and reduced inequalities, coordinated efforts between government and private sectors are essential. Expanding the construction workforce, enhancing productivity, and increasing affordable housing supply will be critical to fostering inclusive and sustainable urban development in Brisbane.

1. Sustainable Development Goals (SDGs) Addressed or Connected

1. SDG 11: Sustainable Cities and Communities
   • The article discusses urban apartment development, housing affordability, and urban densification in Brisbane.
   • Issues related to housing supply, construction costs, and planning approvals relate to making cities inclusive, safe, resilient, and sustainable.
2. SDG 8: Decent Work and Economic Growth
   • The shortage of construction labor and workforce productivity issues are highlighted.
   • Focus on improving productivity and workforce outcomes in the construction industry.
3. SDG 1: No Poverty
   • Concerns about affordable housing and the difficulty of building affordable apartments impact poverty reduction efforts.
4. SDG 9: Industry, Innovation and Infrastructure
   • Discussions on construction costs, productivity improvements, and infrastructure development.

2. Specific Targets Under Those SDGs Identified

1. SDG 11: Sustainable Cities and Communities
   • Target 11.1: Ensure access for all to adequate, safe and affordable housing and basic services and upgrade slums.
   • Target 11.3: Enhance inclusive and sustainable urbanization and capacity for participatory, integrated and sustainable human settlement planning and management.
2. SDG 8: Decent Work and Economic Growth
   • Target 8.5: Achieve full and productive employment and decent work for all women and men, including young people and persons with disabilities, and equal pay for work of equal value.
   • Target 8.2: Achieve higher levels of economic productivity through diversification, technological upgrading and innovation.
3. SDG 1: No Poverty
   • Target 1.4: Ensure that all men and women, in particular the poor and vulnerable, have equal rights to economic resources, including access to basic services and ownership and control over land and property.
4. SDG 9: Industry, Innovation and Infrastructure
   • Target 9.1: Develop quality, reliable, sustainable and resilient infrastructure, including regional and transborder infrastructure, to support economic development and human well-being.
   • Target 9.4: Upgrade infrastructure and retrofit industries to make them sustainable, with increased resource-use efficiency and greater adoption of clean and environmentally sound technologies and industrial processes.

3. Indicators Mentioned or Implied to Measure Progress

1. Housing Affordability and Supply Indicators
   • Number of affordable and social housing units built (e.g., the pledge to build 53,000 social and affordable homes by 2044).
   • Housing prices and price ranges for apartments (e.g., prices ranging from $700,000 to over $11 million).
   • Number of new homes unlocked through government initiatives (e.g., 98,000 homes unlocked by the Residential Activation Fund).
2. Construction Industry Productivity and Workforce Indicators
   • Increase in construction material prices (35.5% increase since COVID pandemic).
   • Shortage of construction labor force (projected shortfall of 46,000 workers by 2028/29 in Queensland).
   • Wages of construction workers relative to other sectors.
   • Productivity improvements as reviewed by Queensland Productivity Commission.
3. Urban Development and Planning Indicators
   • Number of high-density apartment developments and urban densification projects.
   • Proportion of owner-occupiers among apartment buyers (56% in inner Brisbane in Q2 2025).

4. Table: SDGs, Targets and Indicators

Source: abc.net.au