According to the Urban Development Institute of Australia, Sydney’s house-and-land prices are set to increase unless more land is rezoned for housing. The UDIA has warned that there is a shortfall of 20,100 housing lots by fiscal 2030 across the wider Sydney region.
Sydney’s lot prices rose by 14 percent last year to reach a median of $543,000. By comparison, Melbourne ($327,000), South-East Queensland ($272,000), and Perth ($215,000) remain much more affordable markets for house-and-land buyers.
It is estimated that 42,000 new homes were needed per annum to provide sufficient dwellings to accommodate 900,000 more in the state by 2041.
Reasons for the price increase
The price increase is being caused by numerous factors.
One reason is that there is an undersupply of housing lots in NSW. According to the latest figures from the Department of Planning and Infrastructure, the state had a total dwelling shortfall of 107,700 as of June 30 last year. A further 29,800 lots will be needed each year until 2021 just to keep up with population growth
Another reason for the price increase is that development costs have recently blown out. In some cases, it now costs developers more to bring a block of land to market than what they can sell it for. As a result, many developers are holding on to their land banks and waiting for conditions to improve before proceeding with new developments
What does this mean for first-home buyers?
For first-home buyers trying to enter the property market, this news is disheartening but not surprising.
If you’re looking to buy a house and land package in Sydney, you can expect to pay significantly more than what you would have just a few years ago. Even though prices have increased drastically, there are still opportunities for first-home buyers who are willing to do their research and shop around. Keep in mind that if you’re buying off the plan, you may not have to pay stamp duty upfront which could help you save thousands of dollars.
By understanding why prices are increasing and being realistic about your budget, you can stay one step ahead of the property market trends so that you can make informed decisions about your first home purchase.
What affordable options are available in the market?
If you know where to look, there are affordable options available for both first-home buyers and investors alike. The Enigma Home Group is excited to announce its brand new house and land development in South-East Queensland. With affordability as our main focus, this development is already making a positive impact on families looking to settle in the Sunshine State as well as investors seeking value outside of Sydney & Melbourne.
Because we believe every Australian deserves the opportunity to own their own home, prices start at $456,000. We can even help with finance. If you would like to know more, send an email to [email protected]
