Latest / The Good Builder Podcast / The Daily Dose #321 | State of the Land: Queensland Doubled, Victoria Didn't
Transcript
- Az (00:00) Every month someone puts out a number. Starts, approvals, completions. Fair enough, those numbers matter. But none of them tell you what it is actually like to build the thing or supply it or live in it. That's why we started Australian Building Research. Independent, real data from real builders and real customers. Everyone counts how many homes get built. We measure what it's like to be the one building it. Head to Australian Building Research.com.au for more. And we'd love to chat to you about how we can enrich the way you do business. Az (00:48) Two states, same CQs, same data, same method. Queensland doubled, Victoria didn't. That's the headline. And honestly, it's the least useful thing in either of reports we're about to drop. So rather so rather than read you a list of the findings today, I'm gonna walk you through what these two reports we're dropping tomorrow will have in them. What we actually look at section by section and what you should look for when you open it tomorrow. get these six things and you can read the whole thing yourself and make your own call and also get a bit of our interpretation of what's going on in Queensland and Victoria, which is the entire point of us publishing this report. We're here to provide you the best intelligence in the Australian home building industry. And we've got to say a big thank you to Terra Lytics for helping us do that and partner on these two state of learn reports for Queensland and Victoria. So we better get into it. Quick note first of all about what you're going to look at and where these numbers actually come from because it changes how much weight you should actually put on them. This isn't building approval and it isn't median house prices. It's actual lot sales inside active estates across Queensland and Victoria. It's got 26 straight quarters of them from 2020 through the middle of this year, with settlement data coming through, Teralytics, and all the intelligence that they're able to provide us. It shows every release, unsold lot, all counted, and every lot sorted by its frontage and area precisely down to five centimeters and two square meters on the size of the lot. The last part I just spoke about is the whole reason the report can tell you what a lot format costs instead of what a suburb costs. And it leaves out land, developers are still holding back because the question we're asking is what can you buy and build on now? The first of the six things that you are gonna be able to find out. After getting your little hands on this report, is the median lot price. What a block actually costs, corridor by corridor, state by state. And what you're looking for isn't the price itself, it's the direction and the pace of that price. Queensland went from 250 grand to 525 in six years, up 110%. Victoria over the same six years went up 31%. Same country, two completely different markets. And that's before you've opened. Either report properly. The second thing that you're going to get out of the report is the months of supply. That is how long the land currently on the market would last and the rate it is selling. It's the one I'd look at first. Every single line item Because it tells you whether you're going to be able to buy land at all and what is available. Three months is a pretty good balance, and under that, you're competing for stock. Over it, you've got a bit of choice. Queensland is at 1.6 months, Victoria is at 5.4. So one of the estates has a shortage and the other one doesn't, and you're gonna have to check out the report to see which one, even though I just gave you the answer. Third thing that you're gonna be able to see in this report, and we think is pretty cool, is the absorption rate. And which is basically the same idea from the other end. What share of the available lot clears in a month? This is your early warning sign. Land sells and then slab goes down. So absorption tells you where the work is heading months before any approvals figure will actually tell you that too. In Queensland, Logan is clearing at about 98% of available stock every month. Ipswich 96. Brisbane is clearing 10, and that's only 45 minutes up the road. So if you want to know where the work is going, that's where you look, not at the state average. Number four, the fourth thing that you're going to be able to find out of this report, and we love that you're going to be able to find out of this report, is titled stock. What proportion of what's left is actually registered and ready to build on? This is the one that a lot of builders and people out there skip, but it's also the one that'll wreck your program. In Queensland, 97% as I just spoke about. In Victoria, 46%. So in Queensland, you're not shopping an open market. You're waiting on a release, which is a massive timing problem, not a demand problem. The work is coming, it's all just cue. The fifth thing you're going to find out of this report is the corridor breakdown. And this is where the state number actually falls apart completely, even though we publish it in a report for that broader overview. Everything I've just given you gets broken down by corridor. Twelve of them in Queensland, seven of them in Victoria. Have a look at Logan, 0.2 months of supply, Brisbane, seven and a half months of supply. Same state, as I said, 45 minutes up the road. And there's also a 600 grand plus difference on the dirt alone. Victoria actually does the same thing, it just points somewhere that you might not expect. The tightest corridor of the state isn't Melbourne Fringe at all. It's Southwest Victoria. And the last thing that you'd be able to get out of it, there is a bunch more, but I think this is the sixth most important thing is the lot itself, the frontage, the format, and what's getting built on. Frontage first. Queensland's median has gone from 14 meters to 13.2. Victoria 14 down to 13.1. Then the format, and this is the bit that I would listen up for. The report prices lots by size, so you can see what you're paying per square meter. In Queensland, a $250 square meter lot costs $1,628 a square meter. A 5 by 12 costs $1,037. That's a 50% dearer per square meter cost for that smaller block in Queensland. So going narrower to hit a price point saves you a lot less on the dirt than it looks like it should. And in Victoria, the gap is only 22%. The whole lot price is what you negotiate. The dollars per square meter is what you design to. Before I wrap up, I do wanna give a proper shout out to Terra Lytics, Arthur and the team out there. They are the people that provide all of this underlying LAN data that we're able to interpret for you out there. And they have a fantastic platform that helps a lot of builders and also other platforms out there in the industry. I haven't seen a lot of data like it, and I don't think you'll access it outside of accessing TerraLink. So I would go and check them out. And once again, a big sincere thank you to Arthur and the team who have chosen a partner with us and enabled us to provide you with this sort of intelligence. That was very cool. So that's the six things that I think you out there can get from the report that drops tomorrow. Price, supply, absorption, title stock, corridors, and then the lot itself. I think that's everything that you sort of need. The reason we bothered doing this is pretty simple. Builders, suppliers, and trades usually find out what the land market did after it's already done it. And usually from someone with something to sell them off the back of it. We have nothing of that. That has always struck me as a bit of a backwards way to have a relationship. So this is the benchmark. I think this is some of the coolest intelligence out there in the market. I really think it's going to help your businesses out there, not just because it came from us at the Good Builder, but this is why we create these things. And it's the first edition, so keep an eye out because in the next few quarters, in partnership with Teralytics, we're going to be dropping these for everywhere around Australia. And I hope you really like the reports. We'll have all the links and everything below this podcast, so go and check it out. And we appreciate the support and hope it helps you in your building business out there. So till next time, we will catch you. Like and subscribe and thank you very much for tuning in to The Good Builder.