Brisbane’s High-Density Housing Ambitions Stalled by Soaring Costs and Market Realities
More than a third of planned apartment developments in Brisbane may not proceed beyond 2027, according to the latest Brisbane Apartment Snapshot from research group Urbis. Only 6,000 new apartments are forecast to be built in inner-Brisbane between 2027 and 2029—far below the targets set by the South East Queensland Regional Plan. The shortfall threatens the city’s long-term strategy for urban renewal and affordable housing growth.
“A significant proportion of Brisbane’s apartment pipeline remains at risk,” said Urbis director Paul Rigga. The report identifies soaring construction costs, labour shortages, lengthy approval processes, and difficulty securing builders as key barriers. Despite a recent uptick in apartment launches and sales, these have not translated into construction at the scale needed to meet regional housing goals.
Costs Outpace Demand: The Economics of Building in Brisbane
The average price of an existing apartment in Brisbane now stands at $831,000, according to Jess Caire, executive director of the Property Council of Australia’s Queensland division. “It is more expensive to build new supply than to purchase existing stock,” she said. This economic imbalance has made mid-rise apartment projects unviable for most developers.
Grattan Institute housing researcher Dominic Behrens confirmed that Queensland has experienced the steepest rise in construction costs across Australia over the past five years. “What we’ve seen is a really, really massive run up in construction costs,” he said. The situation is expected to worsen as skilled tradespeople and subcontractors are drawn toward infrastructure projects linked to the 2032 Olympic Games.
“A development isn’t going to happen unless it makes money for a developer,” Behrens added. Under current market conditions, only high-rise projects—often exceeding 15 storeys—can generate sufficient returns to justify the investment. This shift has left lower-density, mid-rise developments stranded in planning limbo.
Super Prime Sites and the Baby Boomer Market
Don O’Rorke, chief executive of Brisbane’s Consolidated Properties, said only developments on “super prime sites” are now commercially feasible. These include riverfront locations in South Brisbane and other premium areas with strong transport and amenity access.
“The apartments have to be expensive, and therefore the only buyers are the wealthy Baby Boomer downsizers,” O’Rorke said. These buyers typically seek two-bedroom units with a multipurpose room—ideal for home offices or ageing parents. “It costs the same to build an apartment building on the river as it does to build three blocks back, but you’ll never get the price away from the river to justify the construction costs,” he added.
As a result, the market has effectively frozen for all but the most desirable locations. Projects in suburbs like Wynnum, Mount Gravatt, and Stones Corner—once seen as key growth corridors—are now at risk. Even though Brisbane City Council has proposed rezoning land and increasing height limits to 15 or 16 storeys in these areas, developers remain hesitant without clearer financial incentives.
Height Limits and the Path Forward
The Crisafulli government’s decision to relax height limits in South Brisbane has unlocked a few major projects, including a 50-storey tower by Aria Property Group next to the Skyneedle. But these are exceptions, not the rule.
Behrens argued that townhouses and terraces—often preferred by buyers—should be legal to build in most suburbs. “Our position is that townhouses and terraces should be legal to build basically everywhere,” he said. This would allow for more flexible, lower-cost development options and help meet demand across a broader range of income groups.
Industry leaders are now urging councils to streamline approvals and consider targeted incentives for projects in high-potential suburban hubs. O’Rorke pointed to Indooroopilly as a potential model: a suburb with strong rail access, retail, and a growing base of Baby Boomer downsizers. “It may well become classified as super prime and we’ll see projects proceed,” he said.
Community and Economic Implications
Residents in renewal precincts like Wynnum and Mount Gravatt have long supported higher-density development as a way to improve public transport access and reduce urban sprawl. But stalled projects mean no new jobs, no increased tax revenue, and no relief from housing pressure.
Local businesses in areas like Stones Corner and Fortitude Valley rely on new residents to sustain foot traffic. Without new apartments, commercial activity stagnates. Property values in these zones may also plateau or decline, undermining the very incentives the city hoped to create.
For renters and first-time buyers, the lack of new supply means continued competition and rising rents. The government’s goal of building 300,000 new homes across South East Queensland by 2036 now looks increasingly out of reach if current trends continue.
What Comes Next: Consultations and Decisions Ahead
Brisbane City Council is expected to release a revised draft of its local planning scheme later this year, which may include further changes to height limits and development incentives. Public consultation on the draft is scheduled for June 2025. Developers, community groups, and housing advocates will be closely watching for signals on whether the city will double down on high-rise or pivot toward more flexible, lower-scale options.
Without a shift in policy or market conditions, Brisbane’s high-density housing push risks remaining “dead in its tracks,” as the latest data suggests. The path forward will depend on whether councils and developers can align on a model that balances financial viability with community need.
