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FOR IMMEDIATE RELEASE

19 April 2012

Land sales signal weak year for new home building


The latest residential land update signals persistent weakness in new home building in 2012 . The HIA-RP Data Residential Land Report provided by the Housing Industry Association, the voice of Australias residential building industry, and RP Data, Australias leading property information and analytics provider, showed land sales hitting a fresh low and median land values rising further in the December 2011 quarter. The volume of residential land sales has been below the previous trough set during the GFC for five consecutive quarters now, said HIA Chief Economist, Harley Dale. Over the five quarters to December last year land sales ran at a volume 40 per cent lower than their long term average. This situation points to there being no discernable recovery on the horizon for new home building, further highlighting that current policy settings in Australia are inappropriate, Harley Dale said. Interest rates are too high, plans for contractionary fiscal policy untimely and too tight, state housing reform too slow, and cooperative reform efforts across levels of government too difficult to find, added Harley Dale. The volume of residential land sales fell by 27 per cent over the year to the December 2011 quarter. The weighted median residential land value in Australia increased by 1.7 per cent in the December 2011 quarter to be 0.7 per cent higher when compared to the December 2010 quarter. The median value for capital cities increased by 2.8 per cent in the December 2011 quarter to $219,001, 1.5 per cent higher than one year earlier. The median value for Regional Australia fell by 0.7 per cent in the December 2011 quarter to $153,833, to be down by 1.0 per cent on the December 2010 quarter. RP Datas research director Tim Lawless believes conditions in the vacant land market are the weakest in more than a decade. Vacant land markets are substantially weaker now than what they were back in the height of the GFC and the duration of the downturn has been sustained for five quarters. Over the 2011 calendar year we have seen just under 44,000 land sales which is 46% lower than what was recorded over the 2009 calendar year. Compare that to the dwelling market where transaction volumes are about 28% lower compared with the 2009 highs, which is a weak result in itself, and the significant weakness in the vacant land market becomes even more apparent. For further information please contact: Harley Dale, HIA Chief Economist Mitch Koper, National Media and Communications Manager, rpdata.com

0414 994 186 0417 771 778

For copies of the publication (media only) please contact: Kirsten Lewis on k.lewis@hia.com.au

RESIDENTIAL LAND SALES & MEDIAN LOT VALUE - AUSTRALIA


200,000 195,000 190,000 185,000 180,000 175,000 20,000 25,000 30,000
Source: rpdata.com, HIA Economics

170,000 165,000

15,000

10,000

160,000 155,000 150,000 145,000 -

5,000

Jun-2009

Jun-2007

Jun-2008

Jun-2010

Dec-2009

Dec-2006

Dec-2007

Dec-2008

Dec-2010

Jun-2011

No. of sales (RHS)

Value (LHS)

10 MOST EXPENSIVE REGIONAL MARKETS


Rank 1 2 3 4 5 6 7 8 9 10 Region Richmond-Tweed (NSW) Sunshine Coast (QLD) Gold Coast (QLD) Illawarra (NSW) Barwon (VIC) Mackay (QLD) Hunter (NSW) South West (WA) Fitzroy (QLD) Northern (QLD) Median Lot Price ($) 269,000 235,000 230,290 210,000 194,000 176,000 173,000 163,450 160,000 157,900
Source: rpdata.com, HIA Economics Group

10 LEAST EXPENSIVE REGIONAL MARKETS


Rank 1 2 3 4 5 6 7 8 9 10 Region South East (SA) Mersey-Lyell (TAS) Mallee (VIC) Northern (NSW) Northern (SA) Murrumbidgee (NSW) Murray Lands (SA) Murray (NSW) Loddon (VIC) Ovens-Murrray (VIC) Median Lot Price ($) 74,000 77,500 80,750 85,000 89,500 90,000 97,000 101,500 105,000 107,500
Source: rpdata.com, HIA Economics Group

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Dec-2011

Mar-2007

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Mar-2009

Mar-2010

Sep-2007

Sep-2008

Sep-2009

Sep-2010

Mar-2011

Sep-2011

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