Property developers pull back on apartment projects
The Australian 12:00am April 5, 2017
Lisa Allen, Ben Wilmot
Property developers are shedding major apartment sites along the eastern seaboard as banks tighten lending to oversupplied areas, with some projects ditched by their long-standing promoters.
Tougher lending rules have slugged the market, with investors unable to borrow as much to buy units and banks refusing to lend to foreign purchasers, stalling apartment projects.
Foreign developers drove the wave of luxury apartment towers in Sydney, Brisbane and Melbourne, but some are now taking their capital out of the market as conditions turn. “Money is tight, the banks have switched off the taps,” said one major Sydney apartment developer.
Melbourne financier Andrew Schwartz, the group managing director of Qualitas, said developers had been pulling back on projects for 18 months.
“Finance is definitely harder to obtain — project finance — banks are credit rationing...