Real Estate

Land growth slump a limited opportunity for buyers to get ahead

Written by The ReReport
As seen in the Source link, written by on 2019-05-16 17:00:00

The Patch in Wollert by Jinding Australia (1)

Cheaper lots for sale closer to Melbourne’s fringe in developments like The Patch in Wollert have helped slow, and even reverse growth to median lot prices.

Melbourne house and land buyers eyeing off the city’s growth corridors have about a year to take advantage of a rare slump in price growth.

New figures from the Urban Development Institute of Australia’s Victorian chapter show the city’s median land lot price growth slowed from a booming 36.22 per cent gain in 2017 to a more modest 7.2 per cent increase last year.

Whittlesea was the first and only new homes hub to see its median lot price fall, dropping 6.1 per cent last year.

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But property valuation and consultancy group m3property believes the trend will spread in the coming months.

National research director Jennifer Williams said this would be driven by uncertainty in the aftermath of the federal election and scope for significant changes to negative gearing and capital gains tax for investment properties.

“And we still have a lot of supply filtering through from projects launched quite a while ago when the market was better,” Ms Williams said.


Melton — 3.8%

Hume — 3.5%

Wyndham — 8.1%

Whittlesea — -6.1%

Casey — 0.8%

Cardinia — 4.7%

*Source: UDIA, RPM Real Estate

But it would likely only provide a speed bump, with sustainable growth — below 5 per cent a year — likely to recommence for the city’s house and land sites in about 12 months’ time.

“It’s a good time to buy countercyclically,” she said.

“Though a lot of people often don’t because of the uncertainty.”

Buyers also needed to be aware a falling median lot price didn’t necessarily mean land was becoming cheaper, with the reduction in Whittlesea more driven by new developments closer to the urban fringe coming onto the market.

The Patch in Wollert by Jinding Australia (1)

The Patch in Wollert by Jinding Australia has lots for sale at just $249,000.

Jinding Australia Developments’ The Patch new homes estate in Wollert was launched in March, with prices from $249,000, well below Whittlesea’s $300,000 median lot price.

Managing director Liz Ronson said the development had received strong initial interest despite the subdued market.

The smaller, more affordable lots in the first stage had been of particular interest.

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“The Patch offers a diverse mix of lots, with convenient access to established amenity in Epping,” Ms Ronson said.

“Further, it offers a range of proposed amenities, including sporting grounds, a community centre, local shopping and commercial precinct within the estate and a state primary and secondary school planned to adjoin the community.”