New research has revealed a spike in Melbourne land sales for the December quarter.
According to RPM Real Estate Group’s Q4 Residential Market Review, the total number of lot sales across Melbourne and Geelong’s land market increased 17 per cent to 3,185 for the December quarter when compared with the previous quarter. This jump is up 34 per cent from the same period last year.
RPM’s head of communities, Luke Kelly, said buyers are seeing value in the land market, given they can negotiate a well-priced larger lot, with developers keen to move returned titled stock and unsold lots.
“The key drivers underpinning a strengthening land market included improved buyer sentiment and activity from interest rate reductions and more borrowing power, ongoing price correction and continued incentives and rebates,” Mr Kelly said.
In dollar value, the research found that Melbourne’s median lot price declined 2.1 per cent to $308,900, which Mr Kelly said is “partly due to a reasonable amount of unsold or overhand stock on the market”.
“In addition, rising values in the established market and moderating prices in the land market has reduced the land price to house price ratio, meaning buyers are seeing more value in a block of land or a house and land package rather than an existing house,” he added.
Furthermore, the research indicated investors are seeing increasing opportunity in Melbourne’s greenfield market – “jumping from a share of 24 per cent of all purchases to 37 per cent in the December quarter”.