Sydney's inner west leads the rise in land values
The rise in property prices has flowed through to land values, helping to lift the value of all land across NSW to more than $1 trillion for the first time.
This values the state's land at five times the size of New Zealand's entire economy of $NZ207 billion ($190 billion).
The rise in land values reverses the broad decline of a year earlier, and further gains are expected this year as demand pushes property prices further ahead.
For some property investors, this may lift their land tax liability, and the rise may be taken into account by some councils when considering rates rises.
Amid buoyant demand for properties, Sydney's inner west has again been the focal point.
A year ago, the rise in residential land values in Sydney was led by Strathfield, followed by Marrickville. In the year just ended, the gains spread further west, with the once-unfashionable Auburn leading the way with a hefty 16.1 per cent rise. Suburbs such as Ashfield, Marrickville and, further afield, Ryde have also recorded big gains.
The inner west has been the clear leader in value rises for five years, reflecting lower property prices in that part of Sydney as well as a shift in preferences for greater access to the city centre.
Land values in Marrickville have risen a heady 30 per cent in the past five years, running ahead of Burwood at 27 per cent and Ashfield and Botany Bay at 25 per cent.
The swell has extended to Parramatta, which may largely reflect the fact its median residential land value is still well below $400,000, along with nearby Auburn.
''A lot of that is people who wanted to buy nearer to the city finding apartments too expensive and moving slightly further out for value,'' NSW Valuer General Philip Western said. ''Auburn, for example, has a good mix of properties and affordability - it is at the lower end in terms of values - so it has moved ahead of the broader market.''
And it has been a tale of two cities, with little overall movement in land values at the top end of the market. Signs of life in North Sydney, Waverley and Randwick have been offset by continued softness around Woollahra and Manly.
On the other hand, areas with lower land values are popular, which is why the inner west is so strong and there has been almost across-the-board rises in land values.
Original story posted on 12 January 2014 by Brian Robins. Sourced from Sydney Morning Herald: http://smh.domain.com.au/real-estate-news/sydneys-inner-west-leads-the-rise-in-land-values-20140111-30nki.html