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SA residential building set to decline
Residential building is set to fall across South Australia due to a lack of significant market pressure, according to forecaster BIS Shrapnel.
The latest Building Industry Prospects report claimed building activity is expected to fall by a further 19 per cent by the end of the 2011/2012 financial year. Private houses and private other dwellings will both see significant declines, the report stated, at 13 per cent and 14 per cent respectively.
“2012/2013 is expected to provide some respite to residential building activity as a few years of underbuilding will have mostly eroded the oversupply of dwellings,” the report said.
In 2012/2013, pressure should have returned to the residential market to encourage a slight upturn in demand. Private houses will see the most growth in 2012/2013, at 5 per cent.
Land tax hindering stock increases
Additions to South Australia’s housing stock are being limited by the nation’s highest land taxes, according to a new report.
Median lot prices in metropolitan areas rose from $90,513 in 2002/2003 to $182,613 in 2010/2011, according to the Urban Development Institute of Australia (UDIA) report, due to insufficient levels of land supply.
UDIA president Julie Katz said releasing land to the market was of significant importance in overcoming supply issues.
“The continued increase in SA’s population, albeit slower than most other states, will result in additional demand for residential land,” Ms Katz said.
Provision of adequate amounts of land should be achieved under the rezoning in the 30-Year Plan for greater Adelaide, she said.