The Caloundra South development is releasing land.
The Caloundra South development is releasing land. Contributed

Fears land delays will up prices

WHEN the former state Labor government announced its Affordable Housing Strategy in 2007 it said the role of bring-forward development areas would be to place supply pressure on demand to flatten prices.

However the two planning ministers to oversee the policy - Paul Lucas and Stirling Hinchliffe - did not require that developers who benefited by having their projects approved under the scheme, deliver lots to market within timeframes to guarantee that outcome.

The best Mr Lucas could offer was that he would crack down on any developer he thought was delaying land release but did not provide detail of that process.

For his part, Mr Hinchliffe said in reference to Caloundra South that the Urban Land Development Authority would "devise a plan to ensure land in this area is able to be brought to market as soon as possible".

Caloundra South - 21,000 lots and 50,000 population - and Palmview - 7500 lots and 15,000 people - were key pins in the State Government's Housing Affordability strategy.

Palmview, an Investa development, already has approval for the development of more than 800 lots in the first stage.

But state manager Bruce Harper has ruled out any progress in bringing them to market until sales in the company's Bellflower development are exhausted.

Investa and associated landowners signed an infrastructure agreement with council which they no longer want to keep.

They have been spooked by what council and ratepayer groups fear are the far less onerous conditions applied to Stockland.

Council has estimated the shortfall may cost ratepayers between $360 million and $560 million.

Mayor Mark Jamieson is still to explain the detail of discussions he and planning director Warren Bunker had on the matter with LNP Planning Minister Jeff Seeney two weeks ago.

Industry sources estimate Stockland and Investa now control 80% of the future residential land stock inventory on the Sunshine Coast.

Since 2002 Stockland has secured approval for 3996 residential lots here of which only 1720 or 43% have been sold.

Ben Simpson, Stockland's project director for Caloundra South, said the progress release of lots in line with customer demand, ensured it could adequately supply the infrastructure needed for the community as it grows.

"The early release stage of Caloundra South, Bells Reach has proven extremely successful and has exceeded our expectations," he said. "Following project approval in September 2011, we have sold more than 90 lots and finalised settlement for over 60 of these since we entered the market in early 2012."

Stockland's June 2012 report shows that only 60, or 8%, of the 732 lots in the $138 million Bells Reach (Bellvista stage two) development, the land for which the company bought in 2004, have been sold.

Another 2004 purchase, the $443m Brightwater project, has seen only 49% or 744 of its 1519 lots sold to date.

In 2004 Stockland also purchased land for the $448m Birtinya Island development of which only 183 (22%) of 830 lots have sold, the $167m Kawana Business Village of which 52 (48%) of 167 lots have sold, the $74m Lake Kawana development which has sold 137 (99%) of 138 lots and Lake Doonella, a $68m project of which only 87 (39%) of 224 lots have been sold.

Its 2002 purchase, the $94m The Boardwalk has cleared 187 (95%) of its 197 lots while the $56m Woodgrove at Beerwah was a low-cost housing success that saw 298 lots (98%) of the 304 lots available sell quickly.

Mr Simpson said that 70% of the 60 purchasers to settle contracts on the low-cost John Mainwaring-designed house and land packages at Bells Reach had been local buyers.

He said company surveys had shown that buyers were drawn to the affordable house and land packages which started at $205,000.

Industry sources who spoke to the Daily said they feared the dominant hold Stockland and Investa had over the region's future residential land inventory would allow them to artificially control prices by dribbling lots onto the market at significant impact to first-home buyers. That would be an outcome completely at odds with the stated intention of the previous government.

"It's all about share price and balance sheet," one source said.

Stockland announced last week a 35% decline in statutory profit but said underlying profit - down 7% or $50.2 million on the 2011 financial year - was a better guide to performance.

It does not break out Sunshine Coast figures but its residential business, while down 15%, settled on a record 5388 lots for the year.

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