ESCALATING house and land prices are fuelling burgeoning demand for medium density housing in urban growth areas, according to a Melbourne developer.
Wolfdene director Jonathan Atchison said in the past two years, the number of townhouses and terraces sold by the company had risen from an average of two or three a month to four to five a month at its Cranbourne estates, and five to six at its Point Cook estate.
“The demand for townhouses and built form product in urban growth areas is certainly growing,” Mr Atchison said.
“The market is very strong for land … with developers achieving 15 to 30 land sales a month. As such, prices are going up and we’re at the point now where to buy house and land in Saratoga (Point Cook), we’re talking a cost of between $500,000 and $600,000.
“Now we’re seeing a vacuum created in the $300,000-$450,000 bracket because of those escalations in the market.
“As a result, people that were traditionally buying in those suburbs are being priced out and as an alternative, they are now educating themselves on the benefits of townhouse and apartment living in suburbs such as Point Cook.”
Mr Atchison said the types of buyers turning to medium density housing options were first homebuyers and overseas or interstate buyers moving to Victoria, as well as local residents cashing in equity in their existing homes to build their dream abode.
“A block of land in Cranbourne is about $260,000 plus and in Point Cook, you’re looking at more than $300,000. So by the time you add a $200,000 to $300,000 build on top of that, you can see where the stress point in the market is,” he said.
Mr Atchison said Wolfdene identified the shifting market trend some years ago. The first release of AVA Townhouses at Cranbourne West (pictured on the cover) sold out in 2014 while the second release sold out last year.
At Point Cook, the first release of Saratoga Townhouses also sold out last year and half of the 55 townhouses in the second release have sold since April. Mr Atchison said designing and building their townhouses gave Wolfdene a point of difference over its competition.
“It adds to the quality of the product and to the overall look of the estate,” he said.
