City Land Prices Rise Strongly

Land prices continued to rise throughout 2015, according to the Housing Industry Association’s Land Report for the December 2015 Quarter. The national median lot price rose 5.2% in the December Quarter alone, to reach $234,600.

Over the last five years, median lot values have increased 22%, while lot sizes have been shrinking, meaning that land prices per square metre have risen sharply.

Price rises have been driven mostly by the capital cities.  But two regional locations which have experienced solid population and employment growth now have rising land prices, being the Sunshine Coast ($272,000) and the Gold Coast ($230,500).

Supply isn’t keeping pace with demand, with the number of lot sales actually declining 1.6% in the December Quarter.  Transaction levels have been fading for nearly two years now, but prices continue to rise.

The HIA says the dynamic of falling sales and rapidly-rising prices points to supply bottlenecks.

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