Victorian rural property prices have grown faster than Melbourne house prices over the last 12 months, according to the Financial Review’s report on July 17 2017.
“Some of this increase can be attributed to the record prices paid for farms on Melbourne’s urban fringe by property developers and land bankers for future conversion to residential housing lots with the report showing a 13 per cent rise in primary production property prices in Metropolitan Melbourne. Farms within Melbourne’s urban growth boundary are now regularly changing hands at more than $1 million a hectare – double what was being paid a few years ago”, reported the publication.
ASIC, despite being a securities regulator with no authority to intervene in the property market, overreached to target numerous land banking projects- mostly ones to be developed by the 21st Century Group.
Many believe this was part of a vendetta to target its founder Jamie McIntyre and is considered to be a politically motivated attack. These land banking projects included inside the urban growth boundary in Tarneit and near the urban growth boundary in Wallan on the edges of Melbourne. Several other projects were in fast-growing rural centers such as Bendigo and Shepparton where land prices have also grown significantly.
Litigation funders are preparing to sue ASIC for the losses caused to these land banking investors and also losses caused to other investors over the last decade.
They claim ASIC’s action were abusive, malicious and pre-meditated to cause unnecessary losses. As the land prices continue to rise rapidly, it is fueling the damages claim payout for which ASIC is potentially liable, as it is the profit land banking investors are missing out on every year from the growth in land prices.