Devine To Wait

HOUSING and apartment specialist Devine Ltd expects the residential market to fire once interest rates start sliding.

The housing and apartment specialist would pounce on apartment development sites in Sydney once market conditions turned, managing director David Devine said yesterday.

Since Leighton injected $95 million into Devine early last year to buy a 40 per cent stake in it -- since increased to 43.4 per cent -- Devine has been on a site acquisition spree, building a land bank to develop 10,000 homes in Melbourne, Adelaide and Brisbane. So far, it owns nothing in Sydney.

"Obviously, we'd be looking at the Sydney market for medium density and any opportunities that come up there," Mr Devine said. He did not think property values had any further to fall, and said residential markets nationally were "very much undersupplied". "Vacancy rates are below 1.5 per cent in most markets and according to BIS Shrapnel, we are very much undersupplying the market," he said.

"The stock deficiency is higher than it has ever been and with overseas migration at record levels, we see the residential market improving dramatically."

See The Australian, 15 August 2008