Article: Southeast Queensland property shortage 'a myth'

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Southeast Queensland property shortage 'a myth'

Southeast Queensland property shortage 'a myth'
Article from: The Sunday Mail (Qld)

Daryl Passmore

October 11, 2008 11:00pm

THE scarcity of residential land blamed for forcing up home prices in southeast Queensland is a myth, a new report claims.

The report reveals there is plenty of land available to meet housing demand for the next 19 years ? but most of it is in the hands of major developers.

And much of the available land is in areas less desired by homebuilders, who mainly want to live near the coast, according to the report by the Local Government Association of Queensland.

Premier Anna Bligh earlier this year called on council to fast-track new developments to improve housing affordability.

While the LGAQ report did not find evidence that any developers were deliberately restricting the supply of land to the market to force up prices, it concluded that the accumulation of vast parcels by big companies, particularly during the property speculation boom from 2002 to 2005, was a major factor in price escalation.

Prices soar

Between 2001 and 2004, land prices in the southeast soared 77 per cent, before levelling out with an 8 per cent increase in the three years to 2007.

"What's clearly changed over the last decade is that mum and dad developers and medium-sized companies have been replaced by very large nationally listed companies with very deep pockets and the ability to buy up large areas of land," LGAQ executive director Greg Hallam said.

He said the report, Review Of Residential Land Supply Issues, involved collecting previously unavailable data from councils.

It was a breakthrough study which should lead to better development planning, Mr Hallam said.

"It once and for all scuttles the nonsense bogeyman put forward by the development industry about land supply and application processing times. They are not a factor in high prices," he said.

"It shows there's a concentration of ownership in the high-growth corridors. It shows there's speculation on the fringe of the urban footprint."

Overall, the report says, there is enough residential land to meet demand for the next 19 years in the development pipeline across the region.

With 338,000 urban residential lots identified, there is more than enough land to meet the anticipated need for 300,000 greenfield lots over the next 15 years.

Location, location, location

But much of it may not be where developers ? or homebuyers ? would prefer. About 40 per cent of the potential residential land identified is in the western corridor ? Ipswich and beyond.

Most major developers are focused on Moreton Bay, the Sunshine Coast, Logan, Beaudesert and Redland.

Mr Hallam said unless the State Government fast-tracked transport and other major infrastructure to the west of Brisbane, consumer demand was likely to remain concentrated in coastal areas, pushing prices even higher.

The Sunshine Coast has about 23 years of potential residential land in the current urban footprint, 85 per cent of it held by major developers headed by Stockland, with over 40 per cent.

In Logan, where there is potential residential land for the next 27 years, 55 per cent is controlled by three major developers, including Delfin Lend Lease.

Three leading developers, headed by the huge Springfield Land Corporation, hold 78 per cent of potential housing land in Ipswich, and about 40 per cent of the estimated 15 years of land in Redland is held by three developers.

The Gold Coast has about 14 years of housing land earmarked.

Moreton Bay, which takes in the old Pine Rivers, Caboolture and Redcliffe shires, has just six years left.