THE availability of land on Perth’s urban fringe is drying up, with developers reluctant to release lots until the long-term market effects of the $14,000 First Home Owners grant are known.
Real Estate Institute of WA president Graham Joyce said that, while first homebuyers had now embraced the grant, the initial take-up of the scheme was subdued and developers were still wary.
“They are concerned that the latest surge in demand for land could drop off and are therefore nervous in bringing new stock to the market,” he said.
“And demand at the moment is just soaking up existing lots … so shortages in land stocks are likely in the short term.”
The impact of the GST was still being felt by developers with the cost of earthworks, roads and other infrastructure rising significantly under the new tax system, he said.
“There is plenty of land available but it can’t be brought on to the market for less than $55,000, and the first home owners’ market is not willing to pay that yet,” Mr Joyce said.
“As a result there is a trend toward established homes, so it does not make it viable to release any more land until the market changes.”
