THE SUNDAY TIMES
IMPROVED economic growth and new-found confidence in the Perth housing market has had a positive impact on the new land market, according to latest data from the Urban Development Institute of Australia (UDIA) WA.
Outgoing UDIA WA chief executive officer Allison Hailes said the new land market in Perth had weathered tough economic conditions during the last two to three
years.
“We have been bumping along the bottom of the cycle for the last 12 months and now we are emerging out the other side, with an upward trend emerging,” she said.
“New land sales in Perth are up 3.8 per cent for the June quarter, with close to 1500 lots sold in the region.
“This is a reflection of improved consumer confidence and a sign of positive growth in the Perth market.”
Despite a rise in sales volumes, prices were still slightly down during the June quarter – although this isn’t a trend that will last long, according to Ms Hailes.
The June quarter saw the average price of new lots sold in Perth down 1.7 per cent to $230,825.
“It is absolutely a buyer’s market,” Ms Hailes said. “All indications are that we have reached the bottom of this property market cycle, and with low interest rates and great bonus packages being offered to purchasers, it’s an excellent time to buy.
“There has been an influx of lots on the market this quarter due to several large estates bringing land to the market during the quarter.
“This increase in supply has put downward pressure on the price of lots on the market this quarter.
“However, with developers expecting to bring less land on the market in the next 12 months, our declining stock levels are likely to lead to moderate price increases over the next year.”
The data showed substantial growth areas in the northwestern corridor, in particular the City of Joondalup and the City of Wanneroo, dominated the market with 32 per cent of all sales in Greater Perth.
New land in Joondalup and Wanneroo averaged prices of $213,577 and $228,297 respectively.
Twenty-one per cent of the market share is held by the north-eastern corridor, primarily represented by the City of Swan, with the average price of new land set at $236,688.
“The growth areas across the northern corridor are currently dominating the Greater Perth market,” Ms Hailes said.
“These areas are home to several significant masterplanned communities that are popular with a range of buyers.”
“The rail extension to Yanchep will continue to see the northern corridor attract buyers.”
With an average price of $217,821, land in the southwest corridor – home to the City of Cockburn, the City of Rockingham and the City of Kwinana – represented the best value in Perth.
The cheapest land recorded in Greater Perth was the Shire of Murray, with an average price of $164,864, followed by the City of Rockingham at $176,848 and the City of Kwinana at $199,689.
According to UDIA, a positive migration policy led by the State Government will assist in attracting more people to the state, building economic prosperity and driving the increase in demand for land.