Mirvac has reported a significant slowdown in new home sales amid ongoing challenges in the residential property market, affected by recent tax policy changes and rising interest rates. The property developer recorded 429 net deposits and lots exchanged in the September quarter, alongside 291 settlements, including units sold at its Highforest project in Sydney. This represents a 17 percent decline in net sales compared to the previous quarter, with a notable portion of these sales—282—still conditional.
The downturn follows similar results from rival Stockland, which experienced a 71 percent drop in buyer inquiries across its housing estates during the same period. Stockland’s sales volume fell far below the 619 homes sold in the corresponding quarter last year, and heightened buyer default rates have been reported amid growing market uncertainty.
Despite the weakening residential segment, Mirvac maintains confidence in its overall financial position. The company holds $1.4 billion in pre-sales and reaffirmed its fiscal 2027 guidance, projecting operating earnings per security between 13.2 and 13.4 cents, and distributions of 9.9 cents per security. Its investment portfolio demonstrated resilience, achieving high occupancy levels of 97 percent and positive leasing spreads across industrial, retail, and build-to-rent assets. Mirvac is also progressing through a $200 million share buyback program, which has provided some support to its stock price.
Chief Executive Campbell Hanan highlighted steady performance within the investment portfolio, attributing it to strong occupancy rates and favourable leasing outcomes, as well as new income generated from ongoing commercial and mixed-use developments. He noted that several major projects are currently ahead of schedule.
Market analysts have weighed in on Mirvac’s performance amid the challenging environment. JPMorgan’s property team rated Mirvac as overweight but cautioned that residential demand had softened, pointing to the fall in net sales and emphasizing a concentration of settlements anticipated in the coming six months. Meanwhile, Tim Leahy of Jarden observed that Mirvac’s Queensland operations have seen recent deterioration, with prospective buyer leads declining by around 30 percent across the entire portfolio. However, he noted that Mirvac’s sales decline was less severe compared to Stockland, which has a larger focus on housing estates.
Overall, Mirvac, like other developers, faces headwinds from broader economic pressures and evolving government policies, as the residential property sector continues to adjust to shifting market dynamics.