Homebuyers seeking houses over land

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Emma McBryde

Many potential homebuyers in Rockhampton and the Capricorn Coast are aiming to buy homes over blocks of land because of issues facing the construction industry, according to the latest Herron Todd White report.

The analysis of the local residential market found potential purchasers were preferencing homes up to about ten years old, rather than waiting for builders or risking substantial price increases throughout the construction period.

Property valuer Alistair Gunthorpe also stated in the previous report that several vacant allotments were re-listed for sale and there was a downturn in the demand for vacant land because of increasing construction costs and extended timeframes to complete builds.

“Currently this is seeing a change in the market conditions where the preference has turned to established homes which have increased in value at an unprecedented rate of growth by generating a heightened sense of urgency among buyers to enter the residential market and in turn, driving strong demand and increasing prices as a result,” he said.

“Many builders had to reluctantly withdraw from quoting new builds for a period of time due to the above issues.

“Securing an available builder is extremely difficult with many having to wait over 12 months before they can begin construction.

“This is also the same problem for those wishing to complete renovations. Some major unit complexes planned have also had to delay works due to unknown price increases affecting the overall feasibility of the project.”

Low and Co Property Principal Grace Low said she had not seen a decrease in people wanting to build homes, however some clients who had found themselves waiting longer or having construction prices increased, had chosen to sell the land and buy a house instead.

“I have had to re-sell a few blocks of land,” she said.

One client determined to have their home built, paid hundreds of thousands of dollars to buy another home to live in while they waited 12 months for their house to be constructed on their newly bought block of land.

Ms Low explained that this was partly to do with the rental crisis in the Rockhampton and Capricorn Coast region.

She said the property market was doing very well and people were happy to purchase homes and blocks of land.

Mr Gunthorpe said there appeared to be some slight improvement with a few more builders opening up their quoting databases.

Mr Gunthorpe said, “the Queensland Master Builders Association reported increased building costs due to supply shortage of materials as a result of increased demand a direct result of the Home Builder grant… as well as ongoing disaster recovery work and continued low interest rates”.

Many materials imported to the country were experiencing supply chain shortages due to COVID-19, according to the May report.