Expert shares 10 tips for finding the best building lots in booming Perth market

As the demand for residential building land in Perth soars, driven by investors and eastern states property buyers, Daniel McQuillan, Managing Director of Nu Wealth, has shared his top 10 tips for securing the best building lots in the city.

Mr McQuillan noted that despite the housing crisis, land prices in Perth remain relatively affordable compared to established homes, with REIWA figures showing a 7 per cent increase in the median price of a building block over the past two years, compared to a 20 per cent growth in the median price of an established house.

“For a growing number of property buyers, it is now increasingly attractive to build a new home especially as building prices have started to stabilise after the recent large increases in the prices of materials used in the construction of new homes have now begun to moderate,” he said.

His top tips for selecting a building lot include:

1. Look for areas with planned infrastructure, such as public transport hubs and schools, as these outer suburbs serviced by new Metronet rail stations should expect strong capital growth.
2. Consider location carefully, with beachside properties traditionally achieving higher rates of capital growth over the long term.
3. Remember that land appreciates in value while the home structure depreciates, so choose a block with the greatest potential for capital growth, taking into account the scarcity factor.
4. Ensure you have pre-finance approval in place, as developers want confidence that a buyer has the financial ability to pay for their land purchase.
5. Pay attention to the specific location of a block within a housing estate, as those located on quiet streets or opposite parks or schools will appreciate in value at a greater rate.
6. Check if the estate is a master-planned community and what has been planned for the development moving forward, as homebuyers now want to live in high-quality estates with parklands, walkways, and impressive entrances.
7. Consider the branding of the estate, as an exclusive image will encourage homebuyers to pay premium property prices over the longer term.
8. Compare the square metre size of similar blocks in similar developments to determine the value of the block.
9. Look for estates that offer additional benefits, such as fence and landscaping packages, which can prove important if your financial situation changes during the construction of the home.
10. Avoid buying narrow frontage or sloping blocks, as these types of blocks are penalised in price when resold.

By following these tips, Mr McQuillan believes property buyers can secure the best building lots in Perth’s booming real estate market and set themselves up for long-term capital growth.