Daily Buzz: Tuesday, 20 February

PropertyBuzz, your daily dose of property news.

The skyrocketing gap between house and unit values, uncovering who is most interested in West Australian property, and why land prices are on the rise in Australia

Welcome to Property Buzz! I’m Juliet Helmke. Today is Tuesday, 20 February.

– The roller coaster of the past four years has impacted house and unit values in very different ways, according to new research. CoreLogic reported that at the onset of the pandemic in March 2020, the difference between median capital city house and unit values was just 16.7 per cent, but four years later, this so-called “house premium” has jumped dramatically, with the difference now sitting at  45.2 per cent, representing a value of $293,950.

– Though buyers have typically always been prepared to pay a premium for houses, the accelerated value growth for houses was attributed to changing lifestyle factors during the early pandemic years, which caused Australians to seek out space, prioritising detached dwellings.

-Though the premium contracted through the early part of the rate hiking cycle as house values fell more than unit values, the gap has since rebounded to a new record high as house values once again rise at a faster pace than units.

And the Real Estate Institute of Western Australia has lifted the lid on its website traffic, giving a glimpse into where property searchers are located.

– Brisbane had the highest increase in views, jumping more than 80 per cent, with a focus on rental listings, while Queenslanders in general showed more interest in commercial properties, indicating potential business interest in WA.

– The five most active countries on the website were the US, Singapore, New Zealand, India, and Indonesia, with the US visitors showing a strong interest in market research and analysis.

– REIWA president Joe White acknowledged the interest from eastern states investors was on the rise, attributing it to the value and potential yields of the WA property market, but predicted their involvement will soon decline.

– And the median cost of a residential block in Australia reached a new record high of $340,000 in the three months to September 2023, up by over a quarter since the pandemic began.

– The high cost is attributed to a shortage of shovel-ready land during the early pandemic years, which increased demand and prices leading to a shortage that persists.

– The Housing Industry Association (HIA) reported that the volume of lots being sold has dropped to a 20-year low due to financial constraints, impacting the number of homes commencing construction.

– CoreLogic and HIA suggest that the current shortage of buildable land and high prices pose a significant challenge to the government’s ambitious goal of building 1.2 million homes in five years.

That’s Property Buzz for today. 

See you again tomorrow, 21 February, for your daily dose of Property Buzz.”

If you like this episode, show your support by rating us or leaving a review on Apple Podcasts and by following Property Buzz on social media: YouTube, Instagram and TikTok.