The price of a typical residential building block has jumped 53 per cent in non-metropolitan parts of the Hunter in the past year and 33 per cent in Newcastle.
The Newcastle Herald reported 10 days ago that the property industry was concerned about environmental regulations holding up the release of new housing land.
A Housing Industry Association and CoreLogic report shows the median price of a block of land in Newcastle and Lake Macquarie rose from $335,000 in the December 2020 quarter to $448,000 a year later.
In the rest of the Hunter, including in major growth areas such as Cessnock and Maitland, the median price rocketed from $217,000 to $332,000 in the same period.
The number of blocks changing hands also plummeted.
Across the entire Hunter, total land sales fell from 606 in the December 2020 quarter to 204 in the December 2021 quarter.
Newcastle and Lake Macquarie had the sixth most expensive land blocks per square metre ($898) in regional Australia, behind Sunshine Coast, Mornington Peninsula, Gold Coast, Illawarra and the Central Coast.
Housing Industry Association Hunter executive director Craig Jennion said the median cost of buying a residential block had soared across the Hunter in the December quarter, by $28,000 in Newcastle and $38,500 in the rest of the region.
"At the same time the number of sales continued to fall considerably," Mr Jennion said.
"The decline in the volume of sales while the price continues to increase rapidly is a clear indication that there is a significant shortage of shovel-ready residential land.
"The shortage of land is a result of the surge in demand after the announcement of HomeBuilder in 2020."
The Herald reported this month that the developer of the massive Kings Hill estate north of Raymond Terrace had launched legal proceedings over the plan's refusal.
The Hunter Central Coast Regional Planning Panel rejected Kingshill Development's concept plans for subdividing the first half of the 3500-lot estate.
The company behind a 2000-lot housing development at Minmi, Winten, also remains mired in the planning system after lodging a development application in 2018.
Minutes from a Hunter and Central Coast Regional Planning Panel briefing in June show Winten has been asked to provide more study on two species, the koala and scrub turpentine, whose endangered status has changed since the company lodged its biodiversity assessment.
The minutes show Winten is also working through traffic planning for an area slated to have thousands of new residents.
Transport for NSW has estimated it will take up to 18 months to complete an integrated transport plan for the area.
The state Planning Assessment Commission approved a five-stage concept plan for the site in 2013 which included 3300 housing lots and two commercial centres.
Winten applied this month to build a sales office on Minmi Road as it works on an approved 200-lot estate in the suburb.
"Newcastle has a lot to offer, and, with all the new employment coming there, we just don't see prices retreating," Winten residential sales director Karl Rameau said.
"It should be substantially cheaper than Sydney, but I tell you what we're catching up in a hurry."
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