{{ propApi.closeIcon }}
Our industry
Our industry $vuetify.icons.faArrowRight
Economic research & forecasting Economics Housing outlook Tailored market research Economic reports & data Inspiring Australia's building professionals Business & digital Products & innovation Projects HOUSING Online The only place to get your industry news Media releases Member alerts Submissions See all
Business support
Business support $vuetify.icons.faArrowRight
Become an apprentice host Hire an apprentice Why host a HIA apprentice? Apprentice partner program Builder & manufacturer program Industry insurance Construction legal expenses insurance Construction works insurance Home warranty insurance Tradies & tool insurance Planning & safety solutions Building & planning services How can safety solutions help you? Independent site inspections Solutions for your business Contracts Online HIA Tradepass HIA SafeScan Advertise jobs Trusted support & guidance Contracts & compliance support Professional services Industrial relations Member savings Toyota vehicles Fuel savings Handy pay See all
Resources & advice
Resources & advice $vuetify.icons.faArrowRight
Building it right Building codes Australian standards Getting it right on site See all Building materials & products Concrete, bricks & walls Getting products approved Use the right products for the job See all Managing your business Dealing with contracts Handling disputes Managing your employees See all Managing your safety Falls from heights Safety rules Working with silica See all Building your business Growing your business Maintaining your business See all Other subjects COVID-19 Getting approval to build Sustainable homes See all
Careers & learning
Careers & learning $vuetify.icons.faArrowRight
A rewarding career Become an apprentice Apprenticeships on offer Frequently asked questions Study with us Find a course to suit you Qualification courses Learning on demand A job in the industry Get your builder's licence Continuing Professional Development (CPD) Find jobs
HIA community
HIA community $vuetify.icons.faArrowRight
Join HIA Sign me up How do I become a member? What's in it for me? Mates rates Get involved Become an award judge Join a committee Partner with us Our initiatives GreenSmart Kitchen, bathroom and design hub Get to know us Our members Our people Our partners Support for you Charitable Foundation Mental health program
Awards & events
Awards & events $vuetify.icons.faArrowRight
Awards Awards program People & Business Awards GreenSmart Australian Housing Awards Awards winners Regional Award winners Australian Housing Award winners 2023 Australian Home of the Year Enter online Industry events Events in the next month Economic outlook National Conference Events calendar
HIA products
HIA products $vuetify.icons.faArrowRight
Shop @ HIA Digital Australian Standards Contracts Online Shipping & delivery Purchasing T&Cs See all Products Purchase NCC 2022 Building codes & standards Economic reports Hard copy contracts Guides & manuals
About Contact Newsroom
$vuetify.icons.faTimes
$vuetify.icons.faMapMarker Set my location Use the field below to update your location
Address
Change location
{{propApi.title}}
{{propApi.text}} {{region}} Change location
{{propApi.title}}
{{propApi.successMessage}} {{region}} Change location

$vuetify.icons.faPhone1300 650 620

Land prices stabilise as rate hikes shake confidence

Media release

Land prices stabilise as rate hikes shake confidence

Media release
“The stabilisation of the price of new residential land is a relief following a 26 per cent increase in less than two years,” stated HIA Senior Economist Tom Devitt.

The HIA-CoreLogic Residential Land Report provides updated information on sales activity in 51 housing markets across Australia, including the six state capital cities.

“New residential land prices declined by 0.2 per cent in the September Quarter 2022 to $328,954, remaining relatively stable over the preceding two quarters,” added Mr Devitt. 

“On a per square metre basis, prices fell even further as the desire for space and amenity that characterised the pandemic continued to push up the size of residential lots that Australians demand.

“Sales of new residential land also reached a new record low, with just 4,405 lots being sold in the September Quarter 2022.

“This stabilisation of new residential land prices and falling sales volumes do not reflect an end to underlying shortages of land. Rather, they reflect a combination of worsening affordability and the shock of the RBA’s rate hiking cycle to consumer confidence and borrowing capacity. 

“Declining prices, together with record low sales volumes, are disguising the underlying shortage of land in the short term.

“Sales volumes started plummeting two years ago when land prices were soaring. This is strongly indicative of a shortage of shovel ready land in the face of strong demand.

“The recent price declines have also coincided with the steepest rate hiking cycle in a generation.

“A recovery in demand depends largely on the RBA’s future cash rate decisions. Once demand recovers, the underlying shortage of shovel ready land will further exacerbate the affordability challenges already facing aspiring homeowners and renters.

“Lower land prices and more affordable housing must be driven by a greater supply of land, shorter delivery times and fewer regulatory and tax imposts, not by the destruction of confidence,” concluded Mr Devitt.

According to CoreLogic Economist Kaytlin Ezzy: “Given that much of the available land supply was consumed over the September Quarter and December Quarter 2020, when the HomeBuilder scheme increased demand for land, it’s unsurprising that land sales have continued to trend downwards to new record lows. Similar declines have been seen through a number of construction metrics, including dwelling approvals, which have trended 10 per cent below the decade average for the past six months, and dwelling commencements, which are tracking 32.4 per cent below the peak recorded in June 2021.”

“While a 0.2 per cent decline over the September Quarter 2022 is fairly mild, we would expect the price falls to accelerate in the coming months. Australia’s residential land market typically follows the established dwelling market, which fell by 4.1 per cent over the three months to September. Additional rate hikes, coupled with continually high construction costs, will add additional downward pressure on prices, with steeper declines expected in the December Quarter 2022, and into 2023,” says Ms Ezzy.

For more information please contact:

Thomas Devitt

Economist

Tim Reardon

Chief Economist
Latest articles
View all news $vuetify.icons.faArrowRight
22 Feb
Inquiry into the Help to Buy Bill and Help to Buy Consequential Provisions Bill 2023

HIA provided a submission into the Help to Buy Bill 2023 and the Help to Buy (Consequential Provisions) Bill 2023, herein referred to as the Help to Buy Bills.

22 Feb
Addressing skilled trades shortages key for NT Budget and upcoming election

“The upcoming Northern Territory budget presents a key opportunity for the Government to focus attention on measures to support increased housing supply and the delivery of much-needed homes in the Territory,” HIA Executive Director, Luis Espinoza said today.

22 Feb
Land Development Pre-DCR Clearance Process

New fast-tracked process to access land titles earlier for eligible developments.

22 Feb
2024-2025 Northern Territory Pre-Budget Submission

HIA submitted the Northern Territory pre-budget submission to the NT Chief Minister.