Australia’s latest land report shows the median price of residential land jumped 6.8% in 2024/25 – over three times consumer inflation. As a buyer’s agent, I see this land price surge squeezing supply. With fewer shovel-ready lots, the goal of 1.2 million new homes is under pressure. Lower borrowing costs are boosting demand, but without more land, new housing will stay tight. High construction costs (over a 32% rise since 2020) only compound the problem.
In practice, this means lot prices are soaring in many markets. Perth’s lot prices leapt 29.8% in the last year, nearly catching Melbourne. Brisbane’s lots grew 9.2%, passing Melbourne for the first time. Even Adelaide saw an 8% rise despite still being the nation’s most affordable capital. These numbers show the relative advantage of WA, SA and Queensland land is shrinking fast as demand chases the limited supply.
As a buyer’s agent, I stress that land is the growth engine in property. Houses come with land, and that land value generally drives long-term gains. Apartments tend to have limited or no land, meaning they are less likely to achieve much or any capital growth compared to detached homes or standalone properties. With the limited supply of land, it’s reasonable to expect capital growth to be much stronger (and more consistent) with single homes versus apartments or unit entitlements. HIA has experts who warn that if there continues to be a scarcity of land, buyers will shift into the existing market, increasing values and worsening affordability.
Key Takeaways for Buyers:
- Land value drives growth: Standalone homes tend to deliver higher capital growth because the attached land appreciates. Over time, “land-rich” properties outperform inner-city units.
- Low supply boosts houses: New lot approvals and home starts are running about 7–9% below long-term averages. With supply tight, demand will flow into existing homes (especially those with land), pushing up prices.
- Regional value is fleeting: Western Australia, South Australia and Queensland currently have more affordable land, but recent surges mean this gap is closing. Buyers should act before these markets heat up further.
- Demand shifts to resale: If new supply stays low, more buyers compete for resale houses. HIA warns that this competition will lift established home prices further.
- Ideal buying window: Stable or falling interest rates and scarce land make now a good time to buy a detached home. Early buyers can lock in a property before affordability tightens.
If you’re a first-time buyer or an investor, navigating these trends is easier with a professional buyer’s agent. For tailored assistance, explore our Residential Buyer’s Agent and Investment Property service details. Plus, stay updated with our Real Estate News blog for more regular property market updates. Now you’re ready to make your move? You can connect with Key2dreamz on +61 439 260 917 and also book a free consultation to know more about the apartments or your buying strategy. We’ll help you locate a land-backed home, ideally located, which matches your goals and budget.