Between 2005 and 2008, strong demand for well-located residential englobo properties, led to increasing sales rates and values for the subdivided product, which consequently led to increasing values for these properties. However, the global financial crisis (GFC) in 2008/09 saw price corrections ensue as a result of tighter lending conditions and softening in the residential land market, with increased costs of borrowing and lower loan-to-value ratios impacting on holders of englobo land.
Despite the GFC, the number of lots sold during this period was buoyed in October 2008 by the Federal Government’s boost to the First Home Owners Grant. The boost ended in December 2009, though the WA State Government has continued the First Home Owners grant with $7,000 going towards properties valued up to $750,000. To April this year, 25% of all applications received have been for new dwellings, with 1,256 grants paid towards new houses and land.
Source : Knight Frank