This article seeks to understand if and why developers choose to operate in particular sub-markets or mixes thereof. Interviews were conducted in 2001 with self-identified large-scale private sector developers operating in Brisbane. The findings show residential markets are highly segmented and corresponding development products highly differentiated. Each sub-market carries its risks and rewards and developers have different strategies with respect to targeting residential sub-markets or mixes thereof. Developers generally prefer higher end markets. Likely implications for urban development and challenges for policy are increased pressure for out of sequence development, ready-made socio-spatial differentiation, and development products that are less likely to meet future changing market preferences and so are likely to stimulate higher levels of production, consumption and urban expansion.