State of the Land 2020

2 Apr 2020

National Residential Greenfield and Apartment Market Study

It’s important to note this report was prepared prior to the COVID-19 outbreak and market conditions have changed dramatically in the past month and will continue to change in coming weeks and months. Still, the following information will be a good resource to help you measure the impact of the coronavirus on the market. 

Click here to access the 2020 UDIA State of the Land Report

State of the Land: Key Points for Victoria

  • Prior to the coronavirus pandemic, the median dwelling value in Melbourne was almost 4 times the median household income (ratio 7:2). This means the number of years required to save a 20% deposit has increased to 9.6 years in Melbourne, up from 8.1 years in 2014.
  • After two years of unsustainable price growth, Melbourne’s greenfield market saw the median lot price contract by 2.6% in 2019. The reduction in median pricing helped drive a modest 1.6% improvement in land rates to $837 per square metre. However, this still reflects an 84% increase on 2014 rates.
  • Apartment sales activity in Melbourne started to recover after two years of negative growth, with new apartment sales rebounding 26% between June and November 2019. Construction activity showed signs of improvement with a 9% annual increase in the number of new apartments completed across Greater Melbourne in 2019.
  • Estimates show a concerning forward supply of apartments in Melbourne with the total active pipeline numbers down 20% from 2018. Contributing factors are a decline in the number of units under construction (down 13%), approved units yet to start construction (down 22%) and units in early planning (down 23%).
  • Prior to COVID-19 outbreak, ongoing population and employment growth looked set to provide strong underlying demand. UDIA will monitor and communicate the effect of recent events as soon as we can. 

Read the full State of the Land 2020 report here.