Leading residential developers have emerged from one of the toughest development cycles in the past 50 years optimistic about the future despite lingering concerns around planning, infrastructure and affordability.

Developers attending a recent Centuria Bass Credit roundtable agreed that that the national residential development market has turned a corner and is heading in the right direction supported by stable construction costs, lower interest rates and stock shortages.

For developer Wayne Sun, founder of Sun Property Group, which targets the luxury downsizer market, the next few years represent a “once-in-a-lifetime” opportunity.

“It’s been so long since COVID, and the industry has been through a very difficult time. Now we are very optimistic,” Mr Sun said.

“The next five to seven years I see as a once-in-a-life-time opportunity for the industry with the (favourable) supply-demand equation.

“We saw a lot of builders and developers go down during COVID and I think the next few years will be a golden opportunity because there’s so much shortage.”

Luke Hartman, Managing Director of Metro Property Development, expressed concern about the pace of services and infrastructure delivery to greenfield sites but said he was encouraged by market conditions.

“It’s been a challenging time for an integrated builder-developer but certainly the outlook looks really strong. As an integrated builder developer with our building arm Creation Homes, we’re very, very excited about the outlook over the next couple of years.”

Creation Homes, focused on the house and land and townhouse market, builds more than 2000 homes across Queensland, New South Wales, South Australia and Victoria each year.

“The biggest thing we need right now in greenfield areas is investment into infrastructure, ensuring that any home that is rezoned is serviced,” he said.

“We’re really encouraged by market conditions but there’s constraints in delivering houses due to planning policies and services to allow houses to be built.”

He said housing affordability is the biggest issue and in the expensive Sydney market there is “huge” pent-up demand for properties under $1.5 million.

“We see Melbourne as the biggest risk but the biggest opportunity and are keeping a close watching brief on what’s happening in the market down there,” Mr Hartman said.

“It’s been very tough in Melbourne for some time but on an affordability basis Melbourne looks affordable and cheap compared with the other states so when it rebounds it will no doubt rebound hard.”

Mark Elias Co-Chief Executive of Urban Property Group said recent planning reforms and a strengthening economic outlook are driving meaningful progress.

“We’re seeing greater alignment and support for new housing initiatives from both state and local governments, which is enabling us to accelerate key projects,” said Mr Elias.

“While challenges persist, it’s clear that policy and market forces are beginning to move in the right direction.”

David Giffin, CEO of Centuria Bass Credit, said thematics are good for residential investment and support long term growth of the domestic economy.

“It’s been tough for builders and developers over the last five years but I think we’ve seen stabilisation in construction costs, which gives developers confidence to commence projects,” he said.

“It’s still not easy but I think you’ll see improving conditions over the next five years.”