Ongoing Demand for Housing

The continued decline in land sales could fuel the ongoing demand for established houses.

A recent report highlights that for the second consecutive quarter in March 2010, the volume of residential land sales fell and the median land values flattened out. The latest residential land report from HIA and rpdata.com identified the risk of a renewed decline in new home building starts next year.

The HIA-rpdata.com Residential Land Report shows the volume of land sales fell in the March 2010 quarter to 40 per cent lower than in the same quarter last year.

Meanwhile, the weighted median land value held steady in the first quarter of 2010 (-0.1 per cent), for annual growth of 6.9 per cent.

HIA chief economist Harley Dale said the renewed decline in the volume of land sales is consistent with concern of the recovery in new residential construction. 

“The prospect of new home starts heading down again next year reinforces the need to keep interest rates on hold throughout the remainder of 2010.”

Sydney remains the most expensive residential land market, with a median value of $305,000. Outside the capital cities, the Sunshine Coast in Queensland remains the most expensive land market with a median value of $260,000.

There are 12 markets across Australia where median land value sit at or below the $100,000 mark.

The most affordable market is the Mallee region of Victoria ($72,000), followed by Murray Lands ($77,000) and the South East ($80,000) in South Australia, East Gippsland in Victoria ($80,000), and the Murrumbidgee region in New South Wales ($83,000).