Investors are needed to fund a big expansion in stock to cope with Victoria's rapidly increasing population, which is growing at 1.6%, or 82,430 people, a year. Australia's population increased 1.59%, or by 331,872 people, last year, but the country is reportedly experiencing a construction shortfall of 30,000 new houses a year.
"This kind of population growth will support the housing market, but it means that we're facing a long-term under-supply problem regardless of what may look like an over-supply in today's softening (conditions)."
Mr Lawless said buyers, particularly second or third-home owners with strong cash reserves, were well positioned to buy investment properties in the today's environment of flat price growth and oversupply.
