land constraints could be easing
One of the issues surrounding new home building in Western Australia, and indeed the entire country, is the lack of developable land that is available for purchase. However, there could be some good news for builders in Perth, as the State of the Land 2015 report by the Urban Development Institute of Australia (UDIA) reveals an increase in greenfield sites released all around the country.
While the price of land has been increasing just about everywhere in Australia, the size of new blocks is decreasing as lifestyle factors and land supply pressures dictate they should. For those looking to build a new home in 2015, narrow lot homes could be the answer to the reduction in lot size.
These intelligently built homes, which apg specialises in, help home builders to maximise the use of their land, resulting in more floor space, as well as bigger gardens and lawns than would otherwise be possible. The UDIA reports that between 2008/09 and 2013 the proportion of lots less than 320 square metres that met final approval increased from 11 per cent to 29 per cent.
The number of new blocks that were less than 500 square metres also jumped up, from 48 per cent to 75 per cent. The UDIA states that not only does this suit the goals of first home buyers and downsizers, but it also increases affordability and the number of houses that can be built in any one subdivision.
What are the challenges for new home building in 2015?
While the release of developable building sites in Perth has risen over the 2013/14 financial year by 7.3 per cent, the availability of greenfield land is not the only constraint on the market.
The Housing Industry Association (HIA) noted in a March 5 release that the economic benefits of new housing are vast and far-reaching, but that they are unachievable when the supply of new housing is hindered. The benefits listed include new job creation, enhanced economic activity, better housing and flow on activity in other sectors, such as retail, manufacturing and even government revenue.
However, the challenges with the current system are just as widely felt.
"To achieve a significant increase in the delivery of housing that is affordable and meets the nation's future demographic needs, governments must focus on investment in economic and social infrastructure, increasing the supply of residential land, and removing impediments in the planning system," said HIA Chief Executive Industry Policy and Media Graham Wolfe.
The Real Estate Industry Association of Australia (REIA) has called on the government to address the policy issues that add to the cost of new home building.
"REIA has long argued for the government to review the GST and abolish inefficient taxes, including stamp duty that hinders labour mobility and places a constraint on the economy," said Amanda Lynch, CEO of the REIA, in a March 5 statement.
While Australia's housing issues are far from resolved, the news of increased land supply across the country will come as welcome relief to all those considering building their own home this year.