Stockland, Australia’s largest publicly listed residential developer, has experienced a significant decline in inquiries for new homes, reflecting broader challenges in the housing market amid rising interest rates and recent federal property tax reforms. The company reported a steep 71 percent drop in inquiries across its housing estates during the September quarter compared to the same period last year, falling to 10,452.
This downturn highlights the ongoing pressures facing the housing sector, as tighter monetary conditions and government policy changes weigh on buyer demand. Despite the sharp fall in inquiries, Stockland maintained its guidance for home settlements for the full financial year, indicating resilience amid challenging conditions.
Net sales in Stockland’s housing estates are currently 35 percent below their peak, which occurred in the December 2025 quarter when the federal government’s expanded 5 percent deposit scheme had boosted activity. Analysts from Morgan Stanley noted that current inquiry levels are below those seen during the trough caused by interest rate hikes in 2022 and 2023, contributing to a 4 percent drop in Stockland’s share price to $4.06.
At the company’s annual meeting, CEO Tarun Gupta attributed the weakened demand to higher interest rates and changes to federal tax policy. “Residential market conditions have softened across the country, with demand reducing in most markets following interest rate increases and federal tax changes,” he said. Gupta also pointed to broader economic pressures, including cost-of-living increases and stretched housing affordability, as factors influencing consumer behaviour.
Stockland reported 828 home settlements during the September quarter and held contracts on hand for 4,502 homes, with average prices exceeding those of settlements seen in fiscal 2026. The company noted that while inquiries have declined, improved conversion rates have partially offset the impact on sales. Cancellation and default rates remain below long-term averages, suggesting resilient buyer commitment despite the more cautious market.
In its land lease estates, Stockland acknowledged slower buyer decision-making and softer conditions in the established market but highlighted steady improvements in converting inquiries into sales. The developer reaffirmed its forecast for Funds From Operations per security in fiscal 2027, projecting a range of 38 to 39 cents, and expects the distribution per security to remain steady at 25.2 cents, consistent with fiscal 2026.
The company anticipates that earnings will be weighted towards the second half of the financial year, driven in part by the timing of planned data centre transactions and home settlement volumes. Regional market conditions vary, with Queensland’s housing demand slowing in alignment with national trends. In Western Australia, Stockland described market conditions as more balanced, citing equilibrium between supply and demand. Meanwhile, the New South Wales market continues to face affordability constraints that are dampening sales, while issues in Victoria were also noted but not detailed extensively.