Strong demand for residential land points to a healthy year ahead for housing construction.
A bounce in sales in the June quarter had lifted the total number of sales for the 2013/14 financial year to 10 per cent above the 2012/13 level, according to the Housing Industry Association-RP Data Residential Land Report on Thursday.
The HIA’s chief economist, Harley Dale, said growth in the regional areas was faster in the June quarter than in the capitals.
“Consistent with signals from other housing indicators, the geographical recovery in residential land sales is broadening,” he said.
“That is an encouraging sign for detached and semi-detached dwelling construction in 2014/15.”
In the June quarter, the median price of a block of residential land across the country rose 1.1 per cent to $205,330. In the capitals, land prices were up 7.4 per cent from a year earlier, while outside the capitals the rise was 4.1 per cent.
RP Data’s research director Tim Lawless said the June quarter bounce was “welcome news”.
“A rise in land sales implies a rise in detached housing construction about six months down the track which in turn provides a substantial multiplier for the Australian economy: more jobs, more building materials, home furnishings, appliances and white good sales.”
But, he said, it’s yet to be seen whether the quarterly improvement can develop into a trend.
“Despite the June quarter lift, the previous three quarters were showing a slowdown in the number of sales while vacant land prices continued to rise, a trend which may point to ongoing supply shortages of well-located vacant land,” Mr Lawless said.
MEDIAN PRICES AND ANNUAL CHANGES, WITH LOT SIZES*
Sydney: $289,000 (+2.5 per cent), 500 square metres
Melbourne: $213,000 (1.4 per cent), 448 square metres
Brisbane: $219,000 (9.5 per cent), 480 square metres
Adelaide: $184,950 (9.2 per cent), 363 square metres
Perth: $266,000 (11.8 per cent), 400 square metres
Hobart: $126,000 (-2.3 per cent), 672 square metres
* The “traditional” quarter-acre block is 1,012 square metres.