Australia is entering a housing "supercycle," with pent-up demand for new homes set to significantly increase construction activity. Qualitas managing director Andrew Schwartz predicts that the number of apartment commencements could triple to 75,000 per year, driven by a need to catch up on a years-long supply shortage.

Key points:

• Record Investment: Qualitas invested $2.4 billion in private credit, 85% directed at housing developments.
• Housing Shortage: Current apartment starts total 59,728, far short of the 75,000 needed annually to meet demand.
• Construction Challenges: Labor shortages and capacity issues make hitting this target difficult, especially in cities like Sydney and Brisbane.
• Supercycle Outlook: With the right investment and industry changes, a surge in housing production is expected, though overcoming challenges will require structural shifts in the sector.
• Growth for Investors: Despite hurdles, Qualitas anticipates healthy future capital deployment, potentially reaching $10 billion annually.

Takeaways:

• Expect increased demand and financing opportunities.

• Labour and capacity constraints could limit growth—plan for delays.

• Structural changes are needed to hit targets.

^{This summary is based on an article by Michael Bleby, published in The Financial Review, titled “Australia is entering a housing ‘super cycle’, Qualitas says.”}