The "time is ripe" for build-to-rent housing in Australia - and experts believe the concept has "got legs" for Wollongong.
Ben Burston, chief economist at Knight Frank Australia said there was potential in build-to-rent, which is large-scale, purpose-built rental housing that is held in single ownership and professionally managed.
"For a number of reasons we haven't had much of it in Australia, but now the time is ripe," he said.
"We've got tight supply, low rental vacancy, strong rental growth in residential markets, and a restricted pipeline of conventional residential development."
Mr Burston said he believed BTR was "something that we will see in Wollongong".
"It's not the obvious first port of call, and we haven't got a lot of it in the major markets like Sydney and Melbourne yet," he said.
"It's new, and I think a lot of investors probably want to see some evidence in the bigger cities, but I think it will work in Wollongong.
"And I think that because you've got lower land values, strong residential rents relative to those land values... Investors will be able to acquire sites for less than they can in other places.
"The rents are quite strong, the proximity to Sydney is improving, and so you have a ready-made tenant base for that.
"Right across the country, including in Wollongong, we've got tight residential supply, low vacancy, rising rents. So the market is really crying out for new stock."
Build-to-rent housing was among the topics discussed at Knight Frank's Market Update 2023 event in Wollongong.
Ben Mostyn, managing director Illawarra for Knight Frank said while build-to-rent is new to Australia, he said it's "got legs" to be "quite strong" in the Wollongong area, even if it was on a smaller scale than in other markets.
"It will be interesting to see with some of the new developments that are coming out of the ground (in Wollongong), if they are BTR as well," he said.
"A lot of the local developers are starting to consider it as a part of their long-term investment hold strategy as well."
Mr Mostyn said the industrial property market was also a key growth area to watch in the region.
"With BlueScope doing its masterplan, and the port being positioned to do... A gas terminal, wind (farm), and there's also a lot of heavy manufacturing that will be supporting that," he said.
"So I think there's a demand for industrial land, industrial development, and people looking to relocate out of Sydney."
Readers can now subscribe to Australian Community Media's free weekly Illawarra property newsletter, Hot Property Illawarra.
The newsletter will keep you informed about what's currently making headlines in the region's real estate market and beyond.
To sign up, click here, scroll down, enter your details, click the 'property' box and then click 'subscribe'.
Brendan Crabb
I'm a member of ACM's national property team, covering the Illawarra and South Coast. Based in Albion Park, NSW, I write about exciting, interesting or just downright quirky properties that have been listed for sale, major sales, market trends, auctions and more. One of my favourite aspects of being a journalist is I believe everyone has a story to tell. What's yours?
I'm a member of ACM's national property team, covering the Illawarra and South Coast. Based in Albion Park, NSW, I write about exciting, interesting or just downright quirky properties that have been listed for sale, major sales, market trends, auctions and more. One of my favourite aspects of being a journalist is I believe everyone has a story to tell. What's yours?
