05/12/2007 - 22:00

REIWA cautious on lot availability

05/12/2007 - 22:00

Bookmark

Save articles for future reference.

The Real Estate Institute of Western Australia has highlighted the tight supply of commercial and industrial land in Perth, questioning the number of potential industrial lots, which reportedly stands at around 1,500.

REIWA cautious on lot availability

The Real Estate Institute of Western Australia has highlighted the tight supply of commercial and industrial land in Perth, questioning the number of potential industrial lots, which reportedly stands at around 1,500.

REIWA’s Commercial Property Commentary 2006-07 shows a rise in the number of lots granted final approval, but is concerned this comes amid a backdrop of falling preliminary approvals.

REIWA found that despite an increase of 25 per cent in final industrial land approvals, approved lot potential fell 6 per cent since the June quarter of 2006 to 1,500 potential lots. Preliminary industrial approvals dropped 30 per cent to 394.

In the commercial sector it was a similar story, with final approvals up 6 per cent but preliminary approvals down 40 per cent to 227, and approved lot potential down 8.5 per cent to 473.

Report analyst and REIWA policy director Stewart Darby said the preliminary approvals – which are the first stage of the lot creation process – had been falling sharply for two years, while final approvals had risen only moderately.

Mr Darby said this data should point to a big drop in the number of potential lots as well, yet that had not occurred, suggesting there may be a level of double counting when approvals were gained twice for the same land.

“If there were 1,500 lots out there, there should not be any land supply issue, should there?” Mr Darby said.

Development approvals for non-residential buildings increased 5 per cent by number and around 19 per cent by value.

The tight supply is reflected in sales data, with actual Perth commercial and industrial land sales down 16 per cent by number, yet it was up 18 per cent by value.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

Subscription Options