Humfrey Land Development managing director Barry Humfrey told the AFR the Australian Railroad Group has just bought 80 families into the town, which has taken up “all the slack in the rental market”.
Geraldton’s population is predicted to double within five years.
He said developers don’t have the resources to bring blocks to the market quickly, and are turned off by construction costs, which are about 26 per cent higher than in Perth.
“In the current climate, who would be game to put 300 lots on without pre-selling them,” he said.
Geraldton’s median house price fell 5 per cent in the last year to $395,000.
However the town has seen some development activity, including a luxury waterfront apartment complex with units marketed at more than $1 million.
Another development in the area, a $24 million, four-storey office and residential complex, was completed last year. Fifteen of the 16 apartments sold, almost entirely to owner-occupiers.
“There’s a lot of individual wealth in Geraldton…accumulated over generations by farming and fishing families,” Richard Patterson, of developer Kiama Holdings, told the AFR.
He said many apartment buyers were retiring farmers coming off the land.
An eight-level mixed use project with four levels of apartments is also earmarked for the Geraldton.