This is the official release of Charter Keck Cramer's National State of the Market - Residential Build to Sell (BTS) and Build to Rent (BTR) Apartments, H2 2025 report for key metropolitan areas.
Report Overview
Our Research team has consolidated our market-leading insights into a National State of the Market Report, delivering a comprehensive overview of Australia’s apartment market.
Drawing on our extensive national database, this report examines key indicators including apartment releases, commencements and completions, while offering deep insights into each capital city’s performance. Notable trends and broader market drivers are also analysed to provide essential context at both the national and metropolitan levels.
To view the digital report and download your free copy, complete the form below.
Executive Summary
Welcome to State of the Market H2-2025 Build to Sell (“BTS”) and Build to Rent (“BTR”) apartment market report.
Link Between Established Markets and New Housing Supply
Our readers are reminded that there is a strong and consistent relationship between established housing markets and the feasibility of delivering new housing supply across Australia. Charter Keck Cramer Research confirms that prices for new dwellings (apartments, townhouses and house & land products) are linked to the median house price of the established market in each capital city. As established house prices move, the achievable price points for new housing move with them.
Financial Viability and Housing Trade-Offs
For new medium and higher density housing supply to be financially viable, established detached house prices must reach levels that support these forms of more compact and affordable housing. This dynamic has shaped housing outcomes for decades and across multiple market cycles. It reflects a long-standing housing “trade‑off”, where households make compromises between competing priorities such as price vs location, size vs affordability, quality vs cost, ownership vs renting, or commuting time vs housing costs. These trade-offs continue to drive demand patterns and product typologies in all housing markets.
Diverging Market Performance Across Cities
Over the past five years, cities such as Brisbane, the Gold Coast, Perth and Adelaide have experienced strong and sustained growth in established house prices. This growth has lifted realisable revenues for new dwellings and in particular made apartment development increasingly viable in these markets. In contrast, Melbourne and Canberra have experienced flat or negative house price growth, while Sydney has seen only modest house price growth. In many sub‑markets across these three cities, realizable revenues for new dwellings remain below the current cost of delivery, rendering new supply financially unfeasible.
Rising Delivery Costs
At the same time, the cost of delivering new housing has risen sharply across all dwelling types (apartments, townhouses and house & land). Key drivers include a high and growing burden of taxes and charges, increasingly complex and over regulated planning and building systems, declining construction productivity relative to 20 years ago and higher labour and material costs.
National Cost of Delivery Crisis
Charter Keck Cramer’s research identifies a systemic cost of delivery crisis across all Australian cities. This represents the most significant barrier to addressing the national housing shortage and requires substantial reform from all levels of government.
2026 Market Outlook: Short-Term and Long-Term Drivers
Looking ahead to 2026, Charter Keck Cramer expects ongoing tension between short term cyclical pressures and longer-term structural forces. Short term challenges include higher interest rates and subdued consumer sentiment, while longer term drivers include chronic undersupply of new dwellings and shifting housing preferences across generations. The structural fundamentals supporting medium and higher density living are evident across all cities and are expected to strengthen over the next decade as demographic change accelerates.
Affordability Constraints and Housing Choices
As housing affordability thresholds are reached, markets are increasingly characterised by a mismatch between achievable revenues and household purchasing power. The trade-off thematic is clear: households will rent for longer and, when buying, increasingly opt for more affordable medium and high-density housing. In this environment, Build to Rent is expected to play a growing role, with institutional capital better positioned to absorb risk and deliver supply than traditional Build to Sell apartment models.
Expectations for 2026
Overall, Charter Keck Cramer expects 2026 to be an improvement on 2025, supported by greater certainty and market adaptation to the new operating environment. While interest rates are expected to rise and lending serviceability buffers remain in place, price falls are not anticipated due to the widening gap between established housing values and the cost of delivering new supply, which is expected to place a floor under prices.
Construction Capacity Risks
A key ongoing risk across all markets remains builder availability and construction capacity. This is particularly acute in Southeast Queensland, where pressures are expected to intensify in the lead‑up to the Brisbane 2032 Olympics.
Report Access and Future Engagement
We hope you find this new version of the report useful. The report will be produced on a quarterly basis whilst Charter Keck Cramer will be presenting an update and outlook on the Sydney, Melbourne and Brisbane markets at individual events in each city in August.
Should you require a more detailed analysis or presentation please reach out to the team of experts who would be happy to assist you with your queries.
