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REIQ Journal : March 2010
The cost of residential land continues to rise nationally with a new report showing the median price of raw land jumped 5.7 per cent to $181,158 in the September 2009 quarter. The latest residential land report from HIA and rpdata.com found a 33 per cent rise in the volume of residential land sales when compared to the same period in 2008. The HIA-rpdata.com Residential Land Report results con rm there will be a lift in new home starts in 2010, HIA chief economist Dr Harley Dale said. "The million-dollar question is whether a new home building recovery can be sustained beyond this year. If land is not released in a timely manner, in su cient quantity, then land prices will continue surging and the answer will be a resounding no," Mr Dale said. "Sydney remains the most expensive residential land market in the nation with a median price of $290,000. Outside the capital cities, the Richmond Tweed region in NSW is the most expensive land market (median price of $255,000), followed by the Sunshine Coast ($241,500), the Gold Coast ($241,500), and the Illawarra region in NSW ($192,500)." Conversely, there are still 13 markets across Australia where median land prices sit below the $100,000 mark. The least expensive market is the Murray Lands region in South Australia (median price $69,500), followed by Mallee in Victoria ($70,000), Mersey Lyell in Tasmania ($78,000), and the south east and northern regions of South Australia ($85,000). According to rpdata.com national research director Tim Lawless, land supply constraints continue to persist at a time when demand for housing continues to grow, which can be attributed to extremely high levels of population growth. "We have seen interest rates increased a number of times now by the RBA as well as the full removal of the First Home Owners Grant Boost as at the end of 2009. Increasing interest rates along with the removal of the First Home Owners Grant Boost are expected to result in demand from the rst home buyer sector diminishing signi cantly during 2010 after reaching historical highs during 2009," he said. "With an anticipation that rst home buyer activity will fall back to 'normal' levels during 2010 we expect that investors should return to the market due to less competition from rst time buyers and higher interest rates which generally don't impact investors as much as other sectors of the market. "Residential property investor numbers have already begun to increase during recent months with the value of investor nance commitments increasing by 9.6 per cent since recording their recent low in July 2009." National land sales and prices surge Introducing the new look REIQ eNews REIQ eNews (formerly Memberlink email newsletter) has been completely redesigned with a fresh new look and easy to read layout. The email newsletter updates members on the latest and most important industry and legislative information between editions of the REIQ Journal. Find out first. Subscribe to REIQ eNews by visiting www.memberlink.com.au, and checking the relevant box on your subscription preferences. REIQ Journal March 2010