Australia land prices rise 6%23 September 2015 by News Desk
The price of vacant land for residential development in Australia has risen by an average of 6% over the past 12 months.
But while some cities such as Sydney have seen land prices rise by over 16%, Brisbane has seen an almost 3% fall in prices. The cost of land traditionally makes up around one third of the price of a newly-built house which goes a long way to explaining the recent big rise in house prices in capital cities across Australia.
Darrell Todd of thinkingaustralia says: “If the cost of buying the land goes up by 10% then the price of the completed house goes up by 10% as well. It is the rising cost of land that has contributed, in equal measure to under-supply of properties that has caused the recent increase in house prices across Australia”.
Land prices have been increasing for more than two decades, according to CoreLogic RP Data. Latest figures reveal that over the past 25 years the average price of vacant land across all capital cities has increased by a combined 417%.
Across the world as home prices rise in densely populated cities the size of house plots tends to get smaller, but individual plot sizes in Australia have remained relatively stable in the past year. And in regional areas the size of individual land plots has actually increased by 8.3%.
Land Prices in Australia
City Price Change
Sydney $361,500 (+ 16.6%)
Perth $295,000 (+ 10.3%)
Melbourne $254,000 (+ 14.5%)
Brisbane $216,000 (- 2.7%)
Adelaide $203,000 (+ 3.8%)
Hobart $134,000 (+ 3.1%)