Mernda train line extension boosts land prices in Melbourne’s north

Land prices have soared in one popular northern suburb, with the median price shooting up 147 per cent in a year. We reveal the top areas, why they’re attracting buyers and traps to beware of.

Real estate agents warn vacant land buyers to do due diligence into their builders and check for sunset clauses before handing over their money.

Vacant land sales have revealed the median price in one sought-after northern suburb shot up 147 per cent in a single year.

The Victorian Property Sales Report shows South Morang is the place to build in Melbourne’s north, with buyer demand pushing up the median vacant land price from $167,500 in the December 2017 quarter to $415,000 for the same period last year.

Harcourts Rata & Co sales consultant Justin Sciola said the extension of the train line to Mernda and Marymede Catholic College were big drawcards.

“People are just flocking to those pockets,” he said.

Median land prices also increased in Doreen, Mernda and Wollert over the year, which could also be due to the opening of the Middle Gorge, Hawkstowe and Mernda stations last year.

Mr Sciola said vacant land prices could fluctuate wildly from quarter to quarter, affected by size of the land on offer, how much titled land there was, and number of lots available.

“It just comes down to supply and demand, and in some areas there’s so much untitled land that it’s just not enough to sustain buyer interest,” he said.

“Vacant land prices suffered a bit in some areas when people could afford to buy ready-built homes — why buy a block of land when you can buy something that’s already been established?”

The median vacant land price in Epping dropped from $315,000 to $275,000 between December 2017 and 2018.

Sunbury rose 36.1 per cent over the year to $382,500, Diamond Creek up 15.7 per cent to $482,000, Craigieburn up 10.5 per cent to $359,000.

Over in Macedon Ranges, Kyneton was up 88 per cent to $415,000, Lancefield up 37.9 per cent to $200,000, Woodend up 34.8 per cent to $380,000 and New Gisborne up 11.8 per cent to $285,000.

As the data related to settled sales and some settlements can take up to 120 days, some sales made during this period may be not reported until the next quarter.

Considering buying vacant land? Here’s what you need to know:

Mr Sciola advised people to consider a few steps if they wanted to purchase land lots:

■ Buy land that is as close to titled as possible.

■ Carry out due diligence and background checks on developers about land they have sold in the past and what has eventuated in those areas. Councils are concerned about housing developers promoting non-existent infrastructure such as schools and childcare centres, to sell lots.

■ Consider the infrastructure and amenities in the area.

■ Have a good look at sunset clauses, which can allow the vendor or buyer to terminate the contract if the subdivision a) has not been registered or b) an occupancy permit has not been issued by the sunset date.

Real Estate Institute of Victoria vice president Leah Calnan said suburbs with the highest growth in median prices were those in the outer suburbs of Melbourne and consistent with what the institute had seen the property market.

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“Melbourne has seen the highest growth in vacant prices, on a per square metre basis, compared to other capital cities,” she said.

“It shows that despite the doom and gloom, Victorians are still prepared to invest in pursuing the great Australian dream of home ownership.”

“Victorians interested in purchasing vacant land should ensure they are aware of Council guidelines around subdivision, be aware of what the property may have been used for previously and hence whether they will be required to perform remediation work and importantly consider the location.”