VACANT LAND SALES LOWEST SINCE 1994
Written on the 2 February 2011
THE latest Prodap Report indicates the lowest vacant land sales for a quarter since 1994 in December 2010, while new house and land package sales held steady.
The report confirms that aggregate sales of new developer stock (land lots and dwellings) on the Gold Coast were 1764 for the year ending December 31, 2010.
Vacant land sales fell to 175 in the December 2010 quarter - compared to 316 sales of vacant land in the September 2010 quarter and 324 sales in the December 2009 quarter.
Report author Bill Morris confirmed it as the lowest volume of sales in more than 15 years.
“The fall in vacant land sales in the latest December quarter reflects both diminishing activity by ‘spec’ builders and the low level of assistance to first home buyers in the Gold Coast compared to other regional Queensland areas and also Victoria”.
Gold Coast, Brisbane and Sunshine Coast first home buyers receive a Federal
In Victoria, the first home buyers grant totals $20,000 for a new home and $26,500 for a new home in regional areas, including the Federal Government’s $7000. Stamp duty rates are comparable in both states.
“So, the Gold Coast is about $15,000 behind Victoria for first home buyer incentives, in addition to Victoria’s lower median house prices,” says Morris.
The Prodap Report also confirmed that there are 795 vacant land lots available for sale on the Gold Coast, which equates to around 13 months supply at current take-up rates and 398 new house and land packages, equating to 11 months supply.
Morris warns that further significant land development in the immediate future could easily lead to over-supply, assuming demand does not improve over the next 12 months.
“Indications from developers are that future land production over the next 12 months will reach 2,455 wet and dry lots, or twice the current level of annual demand (for land),” he says.
According to the report, new house and land package sales held up in the latest December
“This is despite the encouragement given to developers of new rental accommodation under the Federal Government’s National Rental Affordability Scheme, which is taking some time to sprout wings,” says Morris.
Land production over the next 12 months is twice the current level of annual demand.