The vacant land market has continued to experience strong purchaser demand through December quarter 2017. Overall, the growth corridors within Melbourne, Geelong and Surf Coast recorded 5,759 gross lot sales in December quarter 2017, which represented a slight decline of 1.6% from gross lot sales in December quarter 2016.
This volume of lot sales was above the number of new lot releases, resulting in a diminished level of total stock on the market across most growth corridors. Consequently, further price pressures have emerged, with the Melbourne median land price of $303,000 in December quarter 2017 equating to growth of 5.2% from September quarter 2017 and 28.5% from December quarter 2016.
In addition to this robust demand, supply levels have been squeezed by the delay of a number of required PSPs and the increasing delays in titles. This has resulted in many developers ‘managing’ stock releases which have impacted on prices. As a consequence, until supply level concerns are tackled, lot price growth is unlikely to dissipate significantly in the near term, in particular with strong population growth and low borrowing costs underpinning buoyant new house demand.
Furthermore, this report provides you with an economic and housing construction update, along with the latest land analysis and news from the VPA.