This article is from the Australian Property Journal archive
POPULATION growth and low interest will continue to drive demand for residential land, according to Oliver Hume.
The firm recorded 1,503 residential land sale transactions, representing a 21% increase on April 2015’s 1,245 sales, the third consecutive year of growth and the highest number for April since the firm began tracking data in 2004.
According to the firm, the trend points to growing buyer confidence and robust demand for land opportunities.
“Sales are expected to remain strong as population growth continues and lower interest rates support demand,” Oliver Hume research manager George Bougias said.
Oliver Hume’s first year of recording the data, 2004, saw just 386 transactions in the month of April.
“Since April 2014, we’ve seen year-on-year growth in monthly sales ranging from 62% (April 2014 to April 2013), 38% (April 2015 compared to April 2014) and now 21% (April 2016 compared to April 2015).
“Leading the charge in 2016 are Melbourne’s western corridor markets with 689 sales in April 2016 with Wyndham, Casey and Melton the strongest performing locations accounting for 23%, 19% and 23% of the total, respectively,” Bougias said.
Oliver Hume director Paul Ciprian said sales volumes had seen an historical jump, with production levels now at capacity and prices remaining affordable, particularly when compared to Sydney.
“But at the same time, strong land sales activity and development during the last few years has begun to impact inventory and the amount of land available for purchase,” Cirprian said. “Upward pricing pressures are being restrained by a desire for wider Melbourne projects to secure market share, which is good news for buyers.”
Gross median land prices ranged from $152,275 in Melton to $230,000 in Casey.
“Median lot prices are now seeing a bump in growth after an extended period of relative stability, a marked trend visible in locations including Cardinia, Casey and Whittlesea, indicative of broader movement in outer Melbourne,” Bougias said. “Buyers are taking the leap and buying land as a true asset, which speaks to confidence.
A new record was also set for time on market, with the average time reducing 62% since 2012 to an all-time low of 2.4 months.
Australian Property Journal
