Market sentiment and sales momentum in the growth corridors continued to soften over Q1 2019. Greenfield lot sales volumes have dropped from an annual rate of 24,000 lots at the peak in 2017 to 6,500 lots in Q1 2019. The reported median lot price for the quarter is $337,000 however discounts/incentives/rebates averaging $20,000/lot are being offered. That represents a significant fall from the peak median lot price of $355,000 in Q2 2018. With cancellations on the rise and an increase in resale/on-sale of lots sold off-the-plan, it is anticipated that there will be no improvement in the land sales market until these influences begin to steady during 2020. Long-term greenfield lot demand projections remain at over 16,000 - 18,000 lots per annum. (Source: Research4/DEWLP/ABS)


The established Perth residential market is relatively steady with the number of properties on the market at 16,551, virtually in-line with 16,688 at the same time in 2018. Weekly sales of 505 properties is also in-line with the same time in 2018 at 500 properties. Lot sales data in the UDIA graph below shows a slight upward trend from the middle of April.

The rental vacancy rate is 2.7% and there has been a slight increase in the median rent to $360 per week. There are currently 7,307 properties available for rent, which is a reduction of more than 17% compared to 8,827 vacant properties at the same time in 2018. Anecdotally, there is significantly more competition for rental properties particularly in the middle ring and inner suburbs. (Source: UDIA/REIWA)


Ongoing weakness in the housing market has seen a slight decline in lot sales volumes in 2019. South East Queensland (SEQ) sales volumes fell from 741 sales per month in Q4 2018 to 685 sales per month in Q1 2019. Traditionally, a decline in lot sales volumes would lead to weaker land prices, however this does not appear to be the case currently in SEQ. The median lot price and median lot size have remained steady in Q1 2019, and both are up slightly on the previous 12 months (5.8% and 3% respectively). This indicates the pricing is competitive and should be well positioned to take advantage of any increase in demand. There remains an expectation of improving market conditions on the back of ongoing population growth. (Source: Research4)

See important disclaimers.