Currently, I have several clients who want to buy houses on 600 sq.m-plus of land, at or below the median price in the respective suburb.
This is proving more difficult than it was a year or two ago.
Right now, in many areas, houses with what are now called ‘large’ or ‘generous’ land sizes, seem to be offered for sale at prices well above suburb medians.
Established houses in the same suburbs at or around median prices turn out to have less than 400, and in many cases, less than 300 sq.m of land – the rest of the original land has been subdivided off, and one or more new house/s built there.
I believe this is an unintended outcome of the government’s relatively recent densification policies. While new, modern and more affordable houses have been springing up in suburbs all across Adelaide, the supply of established homes on old-fashioned, larger blocks of land is being correspondingly reduced.
So, within limits, their prices will almost certainly continue to rise beyond local median prices.
They’re out of reach for many first-home buyers, and will mostly go to people buying their second home, or developers.
At the same time, the banks continue to tighten their lending criteria, forcing would-be home buyers to stump up a larger proportion of the purchase price.
It’s going to be interesting to see how this plays out over the next few months.
