The price of vacant land across Australia’s capital cities is almost 40% higher than land in regional areas, as land prices continue to rise in capital cities and drop in regional areas.
Figures released by CoreLogic RP Data reveal the price of vacant land increased by 6% across the combined capital cities over the 2015 financial year, while the price of vacant land in regional areas dropped 3.4%. As at June 2015, the median selling price of vacant land was recorded at $258,543 across the combined capital cities and $156,500 across the combined regional markets.
Median land prices in regional areas of the country are now 39% lower than those in capital cities, the widest differential since August 1990.
Over the 25 years to June 2015, median vacant land prices have increased by 417% (6.8% per annum) across the combined capital cities and by 422% (6.8% per annum) across the combined regional areas.
Whilst all capital city land prices per square metre increased over the 12 months to June 2015, except for Brisbane and Hobart, two cities were well above the pack.
“On a rate per square metre basis, vacant land in Sydney and Perth is much more expensive than all other capital cities,” CoreLogic RP Data research analyst Cameron Kusher said.
Kusher added that the ever-rising land prices will have an effect on house prices.
“As we continue to see the costs of capital city land continue to rise, the rebound caused by this effect is that ultimately the cost of new housing will also rise.
“While restricted land supply and excessive charges associated with new development remain, we anticipate that the cost of vacant land and subsequently new housing will continue to rise.”