Perth new land prices increased 34% in 2024, officially ending the west coast’s reign as the most affordable capital city in Australia according to UDIA’s annual State of the Land Report released today.
The new land price for Perth now sits at $329,000 with Adelaide now the most affordable capital with a median lot price of $307,000.
According to UDIA WA CEO Tanya Steinbeck, the significant increase in new land prices can be attributed to the ongoing housing supply shortage that is impacting the residential property market in WA.
“This is simple demand vs supply theory in practice,” Ms Steinbeck said. “We have seen demand for housing in WA continue to escalate as our population increases, economic conditions remain strong and unemployment is low.”
“Rental vacancy rates also remain extremely tight and rental costs continue to remain at record highs,” Ms Steinbeck said.
“In response to the ongoing strength in demand for new housing, greenfield developers have put their foot on the accelerator, ramping up supply where possible,” Ms Steinbeck said.
Annual completions were up 24% in Perth’s greenfield land market and house approvals are also up 47%.
“While developers have ramped up activity over the last couple of years, WA is still falling well short of the National Housing Accord targets set by the Federal Government,” Ms Steinbeck said.
“The UDIA State of the Land 2025 forecast dwelling production for Greater Perth indicates very significant year-on-year shortfalls against the National Housing Accord target over the coming five years,” Ms Steinbeck said.
According to the report, UDIA’s current forecast is predicting a cumulative five-year delivery of ~79,000 new homes, which will be ~24000 dwellings short of the Accord target for the reporting region.
“This year’s State of the Land report findings reinforce the need for a keen focus on housing supply for State and Federal Governments moving forward,” Ms Steinbeck said.
“At a state level, the Cook Government made several pre-election commitments that UDIA WA will be tracking to ensure they are implemented in consultation with industry,’ Ms Steinbeck said. “It is critical that private industry is supported in getting on with the important job of delivering more land to the market, where it is needed.”
“While the new land market has been able to ramp up in the last couple of years, it is becoming more complex to bring large swathes of developable land to the market across the Perth Metro region,” Ms Steinbeck said.
“Lack of enabling infrastructure and environmental constraints are the top barriers to getting more new land to market.”
“We need to make sure we are taking a balanced approach to housing delivery that supports greenfield development where appropriate, as well as delivering more medium and higher density housing options,” Ms Steinbeck said.
The State of the Land report shows that annual new unit sales were down 12% in Perth in 2024.
“We reached near record lows for multi-unit sales during 2024,” Ms Steinbeck said.
“New unit approvals are up, which is promising, but we need to focus on making these types of projects more financially viable so that those approvals are converted to housing on the ground,” Ms Steinbeck said.
“Despite the State Government’s pre-election commitments in this space, more can be done to support multi-unit project viability,” Ms Steinbeck said.
UDIA WA has been calling for the increase and expansion of the Infrastructure Development Fund (IDF) into an Infill Development Catalyst Fund to get more apartments on the ground. This should allow reimbursement of a range of statutory fees and charges, broader than headworks.
“Overall, this year’s State of the Land Report has reinforced much of what we already know,” Ms Steinbeck said. “The housing challenge before us remains significant, and government at all levels, along with industry, need to continue to collaborate so we can deliver the homes we need, faster.”
UDIA State of the Land 2025 was launched at UDIA National Congress in Brisbane today.