WA land sales continue to rise

Erick LopezThe West Australian
Land sales has picked up again despite trade and material challenges, according to The Agency Property Partner Rash Dhanjal.
Camera IconLand sales has picked up again despite trade and material challenges, according to The Agency Property Partner Rash Dhanjal. Credit: Adrian Wojcik/Getty Images/iStockphoto.

Demand for new land in Perth continues to grow, according to the latest statistics released by UDIA WA.

The September quarter UDIA WA Urban Development Index has recorded a 35 per cent increase in new land sales for the quarter.

“While the building stimulus measures pushed up sales dramatically last year, we are now seeing a steady increase in demand for new land in Perth due to a range of factors that are boosting buyer confidence,” UDIA WA CEO Tanya Steinbeck said.

“While buyers were scrambling to meet the timeframes for the federal and state building grants last year, we can see now that the dust has settled.

“We have strong underlying demand for new housing that is ongoing, even without the incentive of extra cash grants from the government.”

Ms Steinbeck added that buyer’s confidence has been buoyed by Western Australia’s strong economic performance, low unemployment rates and accommodative lending rates, as well as the ongoing rental crisis.

The Agency Property Partner Rash Dhanjal specialises in the sale of residential property, as well as new and existing blocks of land.

“We’ve seen an increase in buyer demand,” he said. “I’d say the previous quarter was a low that we’ve had throughout the year of the building grants finishing.

“Compared to last year, obviously, there was a lot of land purchases that happened during the grant and, since then, we’ve had land slowly trending upwards, but it’s good to see that they’re bouncing back.”

Mr Dhanjal said it was positive news to see land sales pick up again despite the trade and material challenges, as well as increased building costs.

“I also feel like that’s probably because a lot of people are frustrated with the established housing market. A lot of the quality homes coming on the market are selling pretty quickly, so there’s a lot of buyer frustration there,” he said.

“The other issue currently is the rental market – vacancy rates are point nine in the Perth metropolitan area, so for every 1000 homes that come up in the rental market, nine sit vacant, so there’s a significant rental pressure.”

While demand for new land is high, Perth remains one of the most affordable cities in the country.

The average price of land has risen five per cent over the quarter to $247,391 – that is an 11 per cent increase from the same time last year.

“While it is a positive indicator of our state’s economic success that demand for new land remains high, this does not come without some challenges,” Ms Steinbeck said.

“Maintaining sufficient housing supply is critical to the liveability of our communities, maintaining the competitiveness of our economy and keeping a lid on affordability,” she said.

In terms of specific areas to watch, the latest statistics show that the City of Wanneroo experienced the biggest jump in sales, with the number of new lots sold increasing by 54 per cent over the quarter.

The lift in sales in Wanneroo was mostly due to sales in coastal areas, including Alkimos, Eglinton and Amberton, as well as the popular area of Banksia Grove.

The City of Swan remains the area with most new land sales activity, representing 28 per cent of Perth’s market share and experiencing a 41 per cent increase in the number of new land sales for the September quarter.

According to Mr Dhanjal, inner-city suburbs are still seeing high demand for land, especially suburbs in the catchment areas of sought-after schools such as Riverton and Harrisdale.

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