Lot prices pressure
The Housing Industry Association (HIA) released some interesting figures on lot prices over the decade to September 2022.
The median lot price in Sydney and Melbourne more than doubled over the 10-year period.
I was recently reading about a homeowner in The Ponds near Quakers Hill in Sydney who's steadfastly refused to sell his block of land to developers, and is now sitting on a bizarre site worth an estimated $50 million at the last count.
Granted this probably seems absurd if you live in a small regional town - in fact, if you live almost anywhere except for a large and rapidly growing city - but that's the nature of housing demand in Australia's biggest cities, and the lack of available supply.
Will the next decade be any different?
The trajectory of interest rates may be different, but population growth is now running at one extra person per minute - which equates to a record high of more than 500,000 per annum.
Source: ABS
With most new immigrants heading to the big cities, Melbourne's population is projected to grow by more than 1 million over the next decade, and Sydney (which is geographically far more constrained) won't be far behind.
While there will be ups and down for housing market demand, I expect the next decade will be more similar than different.
Over the past few weeks it's been reported that China's population has now peaked earlier than expected, and it set to decline from here. China previously had a one-child policy, and now probably regrets it.
Countries like the UK, New Zealand, Canada, and Australia are looking to avoid a similar fate, and all appear to be going for hell for leather on population growth now.
