Builders- A year in review.

Written by- Adele Katelanis

Following on from the year 2020, our builders’ partners were performing stronger than ever. Making a high volume of sales that was unexpected following the wrap up of the builder grant. There was a sense of concern surrounding the anticipation of smaller builder businesses struggling to operate with the increased costs of materials and a shortage of trade. Luckily, most builders were only marginally impacted.

Builders battled to secure land, for their house and land teams, but also for their clients. Title timeframes were also a juggling act, as many land releases were flying out the door. The demand for land, saw many developers starting to sell the land into 2023.

This was a concern for some of our builder partners, as they were unable to lock in pricing due to the price rises and shortage of construction materials. As mentioned by Emily Ballard (National House and Land Manager) from Porter Davis, “The same problem-solving skills around material shortages were also needed, having to come up with solutions when shortages did hit. Having a proactive mentality was the key to overcoming each set of these roadblocks.”

Due to most working professionals, and families working from home, there was a strong desire to move away from the city life and have that dream backyard. This was evident with high demand and activity across the regional parts of Victoria. At the beginning of 2020, we saw strong demand for smaller blocks, budget conscious and price point drive buyers. Leaping forward to mid-2021 we found many of our builder’s purchasers were after bigger blocks, regardless of price point.

There was a stark comparison between 2020 to 2021, reiterating that home purchasers had the desire to spend big, in a Covid-19 world. Spending money for holidays and extra co-curricular activities such as dining out was not an option. As mentioned by Taylah White (House and Land Manager) from Carlisle Homes, “it was very apparent that the desired block size certainly increased (across all Regions and walks of customer life). Instead of traditionally finding the demand lay with smaller blocks, therefore smaller product i.e., 21m blocks/16 square singles, our customers were after 448m2s – 512ms, to build a ‘sanctuary’, a place to be proud of.”

Overall trends include building double storey homes to maximise space and creating functional and working living spaces to accommodate a home office. Ballard noticed this trend over the course of 2021 stating, “The demand for double larger homes from our top range and the demand for larger 14m/16mx 32m land was surprising, as all trends prior to 2022 were not leading to this. This was particularly surprising when it carried past the homebuilder grant, as there were no additional grants to increase total spend amount.”

This trend was seen both in house and land and medium-density space, as many of our purchasers found more value in purchasing a townhome that was larger in internal built size in comparison to a small (15 sq or less home) on a very small block of land. As mentioned by White, “We saw an uptake in double-storey homes and in particular a large uptake in our Grange range. This trend was noticed all year round, with a noticeable increase compared to the previous CY. We also saw a demand in 14m/16m x 32m land sizes which highlighted to us there was huge confidence in the market, as well as larger budgets and spends.”

For 2022 things to look out for will be a big shift and a very strong focus on sustainable and eco-friendly living. As more land developments shift their focus on long term outcomes that are helpful to the environment, will see many more builders play in this place. With the anticipation of the national construction code to change this year, it will be expected for homes to be built to a 7-star standard. Builders will focus on creating solutions for their homes to be zero net carbon, addressing leakage, low energy outputs as well as creating ways to ensure building sites create minimum wastage. Home incentives packs that address sustainability and energy efficiencies will come into play.

Builders in 2022 will be navigating the challenge of offering zero net carbon homes whilst staying affordable. As mentioned by Ballard, “I would predict that both builders and developers are going to have to work closely together to find plausible solutions to address this.” Future buyers have never been more educated and environmentally conscious than they are today, and we may see a shift in mindset regarding where they purchase and who they purchase with.

Purchasers will be proud to live in a home that has helped reduce greenhouse gas emissions, and sustainable living and vegetable gardens will be in vogue. Homebuyers moving forward will be proud of their home that has a positive impact on the environment as well as aesthetically, as mentioned by White, “With the majority of our customers working from home, and this fast becoming the new norm, people care more than ever about their living space. Spacious living areas and studies were a must. Beautiful Facades and contemporary design that our customers would be proud to live in and show off to friends & family were extremely important.”  

Reflecting on the unexpected trends of 2020 and 2021 it seems like it will be a pivotal year of both innovation and new ideas.

.