Land prices in south-east Queensland are rising at a rate of more than 10 per cent a year, thanks to large land shortage in the region.
The shortage is being blamed for last month’s HIA-RP data Residential Land Report results, which showed Brisbane land prices had climbed 7.1 per cent in the three months to June, well ahead of the national average of 1.1 per cent.
Just 26,000 lots were produced last year, despite demand for 42,000 lots, according to the Urban Development Institute of Australia.
The Institute’s Queensland chief Brian Stewart said the state was currently experiencing the ‘perfect storm’.
“We have hit the perfect storm in size, dimension, and range of problems,” he said.
“Those include lack of finance from the broking sector to allow projects to proceed; there’s been a substantial escalation in process; then there are the infrastructure charges and construction costs. It means projects are just not viable.”
Mr Stewart’s comments were backed by recent data from the Australian Bureau of Statistics, which showed building approvals had slumped 5.4 per cent in Queensland during the month of September.