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Land sales signal faltering recovery
Released 20 July 2010

The volume of residential land sales fell for a second consecutive quarter in March 2010, while median land values flattened out.

The latest residential land report from HIA, highlights the risk of a renewed decline in new home building starts next year.

The Residential Land Report shows the volume of land sales fell in the March 2010 quarter to a level 40 per cent lower than in the March quarter last year. Meanwhile the weighted median land price for Australia held steady in the first quarter of 2010 (-0.1 per cent), for annual growth of 6.9 per cent.

“The renewed decline in the volume of land sales over the six months to March this year is consistent with mounting concern over the sustainability of the recovery in new residential construction,” said HIA Chief Economist Harley Dale.

“The prospect of new home starts heading down again next year reinforces the need to keep interest rates on hold throughout the remainder of 2010. It also reinforces the compelling case for urgent action in ensuring adequate, affordable land supply, including addressing the restriction of finance for residential development which is severely handicapping new home building activity,” added Harley Dale.

Sydney remains the most expensive residential land market in the nation with a median price of $305,000.

Source: HIA