On the edges of Sydney, where packed suburbs give way to paddocks and market gardens, the demand for new homes has outpaced building activity.
With home prices soaring in established suburbs, buyers seeking the Australian dream of a free-standing home and yard have flocked to the fringes of Australia’s largest and most expensive housing market to purchase more affordable land.
The construction rush has helped reverse a negative trend in building approvals. “House approvals touched an 18-month high of 9,929 in September, unexpectedly prolonging a boom many thought was winding down,” said Tom Westbrook, a journalist for Reuters.
Heightened building activity has also created a labour shortage in the building industry.
“There aren’t enough bricklayers to keep up, so what builders have started doing is actually looking for other products to use rather than brick,” James Logue, housing manager at Fairmont Homes, told Reuters.
Demand from buyers willing to purchase land on the fringes has propelled the city’s median residential lot land values to a record high of $470,000 in October.
At the same time, the additional supply of new homes has helped cool the city’s housing market, to the relief of the state government and prudential regulators who were worried about the housing bubble risk.
Collections: Mortgage News