Buying land as an alternative entry into home ownership

As the value of established property has been rising strongly over the past few years some homebuyers might be drawn to considering vacant land and building as an alternative due to lower entry costs.

This is the theme of the latest Month in Review report, September 2024, from Herron Todd White, one of the largest independent property valuation and advisory groups in Australia.

The upside with a vacant site is that the buyer eventually gets a home that suits their list of needs as they start with a blank canvas, and according to Director Todd Beckman, the Central Coast has a myriad of vacant land possibilities.

“Whether you’re looking for proximity to schools, easy access to transport links or a particular neighbourhood vibe, there’s plenty of options across different locations and market segments,” he said.

In the northern areas of Warnervale, Woongarrah, Hamlyn Terrace and Crangan Bay the average-size blocks range from 400-850sqm with good access to the M1 Motorway which makes commuting and travelling relatively easy.

“If your focus is on Hamlyn Terrace, Woongarrah, Wadalba and Warnervale you will notice that in some areas there are smaller block sizes,” Beckman said.

“These smaller lots are strategically located close to schools and shopping facilities, making them ideal for families or individuals who prioritise convenience and proximity to amenities.

“Each area has its own set of advantages, so your choice might come down to what suits your lifestyle best – whether it’s easy freeway access and larger blocks, or proximity to schools and shopping with more compact lots.

“These suburbs offer a variety of residential land estates, each with their own characteristics and price points.

“Many of these estates are selling off the plan, with prices typically ranging from the low $400,000s to the mid $600,000s.

“This range reflects the different sizes and features of the blocks, as well as their locations within the suburbs; for instance, larger blocks or those in more sought-after spots might be at the higher end of the spectrum, while smaller or irregular shaped and steep blocks could be priced lower.

“The estate known as The Glenning in Glenning Valley has recently released registered land for sale starting from $680,000 and ranging up to $900,000. “Don’t expect the new vacant land lots to be around for long – this 44-lot land subdivision should prove to be just as sought-after as the nearby land releases in The Glades estate.”

Beckman said established homes have been selling for premium prices in the marketplace, ranging from $1.1M to $1.8M depending on the quality of the dwelling.

“In the southern areas of the Central Coast, which are more established and built-up, the availability of vacant land is indeed limited,” he said.

“This scarcity drives a trend where older-style homes in desirable locations are often demolished to make way for new developments and many older homes are being replaced with new, modern residences.

“This allows homeowners to upgrade to contemporary living standards while staying in their preferred locations.”

Beckman said that in response to the limited land availability, there was an increasing shift towards higher density developments.

“This includes villas, townhouses and low-rise unit complexes, which can provide more housing options in sought-after areas such as Ettalong Beach, Umina Beach and Woy Woy,” he said.

“These changes reflect the evolving needs of the community and the increasing demand for housing in well-established locations.

“Beachside vacant land typically offers a unique and highly desirable opportunity, especially in sought-after coastal areas such as Wamberal.

“A 651sqm vacant land site, a stone’s throw from the beach at 107 Ocean View Dr, Wamberal, sold through Di Jones Real Estate for $2.444M in January 2024,” Beckman said.

The property market indicators in the Herron Todd White report for September showed there was stronger demand for units over houses, the trend in new house construction was steady and the volume of house sales was increasing with the market showing a start to recovery for both houses and units.

There were no surprises that the rental vacancy situation showed a shortage of available houses relative to demand but a particularly severe shortage of units.

There is a strong demand for units but the trend to build new units is significantly declining, according to the property market indicators in the report, although the volume of unit sales is increasing strongly and occasionally selling at prices exceeding their potential resale value.