Gerry Harvey, the billionaire chairman of Harvey Norman and a major real estate investor, says he expects building costs to keep rising and make new property developments, already marginal, increasingly unviable.

Mr Harvey is best known as a retailer and together with his wife, Harvey Norman chief executive Katie Page, has amassed a fortune of $3.39 billion, according to the Financial Review Rich List. But he is also a considerable investor in real estate, and said he was holding on to several sites without developing them because they were in the “too hard basket”.