Western Australia's apartment sector has reached a fresh high, with developer Finbar reporting that only labour constraints are holding it back from even greater growth. The company, one of the state's leading apartment developers, said demand for new apartments remains strong, driven by population growth and a tight rental market.
Record Sales and Strong Demand
Finbar managing director Darren Pateman said the company had achieved record sales in the first half of the financial year, with strong interest from both owner-occupiers and investors. "We are seeing unprecedented demand for well-located apartments, particularly in the Perth metropolitan area," he said.
The company reported a 20 per cent increase in sales compared to the same period last year, with projects in Subiaco, South Perth, and East Perth performing particularly well. Pateman attributed the strong demand to a combination of factors, including population growth, low vacancy rates, and rising rental yields.
Labour Constraints Limiting Growth
Despite the positive outlook, Pateman warned that labour shortages were constraining the sector's ability to deliver new projects. "We have the demand and the finance, but we simply cannot find enough skilled workers to build the apartments," he said.
The labour shortage is particularly acute in trades such as carpentry, plumbing, and electrical work, with many workers having left the industry during the pandemic. Pateman called on the state and federal governments to do more to attract skilled migrants and train local workers.
Industry Outlook
The comments from Finbar come as the broader commercial property sector in Western Australia continues to recover from the pandemic. Office vacancy rates have fallen, and industrial property is in high demand. However, the apartment sector remains a bright spot, with developers reporting strong pre-sales and construction activity.
Pateman said the company was confident about the future, with a strong pipeline of projects in the planning stages. "We are optimistic about the medium to long-term outlook for the apartment sector in Western Australia," he said. "But we need to address the labour shortage if we are to fully capitalise on the opportunities."
The company is also exploring new technologies and construction methods to reduce its reliance on traditional trades. "We are looking at prefabrication and modular construction as ways to speed up delivery and reduce the need for on-site labour," Pateman said.
Government Response
State and federal governments have announced various initiatives to address the skills shortage, including increased funding for apprenticeships and training programs. However, industry groups say more needs to be done to attract skilled migrants and encourage young people to consider careers in the construction industry.
The Property Council of Australia has called for a national strategy to address the labour shortage, warning that it could hamper the delivery of new housing and commercial property projects. "We need a coordinated approach from all levels of government to ensure we have the skilled workers we need to build the homes and businesses of the future," said council executive director Sandra Brewer.
In the meantime, developers like Finbar are doing what they can to manage the labour shortage, including offering higher wages and better conditions to attract and retain workers. "We are doing everything we can to keep our projects on track, but it is a challenge," Pateman said.
