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<p>Despite a surging population and record high levels of new construction, a lower proportion of housing stock is selling. </p>
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<p>The analysis, paired annual settled sales data with dwelling counts over time to show that the proportion of total housing stock turnover on an annual basis. </p>
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<p>The analysis found that over the 12 months to September 2017, just 5% of the national housing stock transacted; the lowest proportion of stock-turnover since April 2012 when it was at an historic low of 4.9% of stock transacted. Over the nine years of data available, an average of 5.5% of the national housing stock transacts in a given year.</p>
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<p>Across the combined capital cities, a record-low of 4.7 percent housing stock transacted over the past year which was well down on the 5.6% average. Across the combined regional markets, 5.6% of housing stock transacted which was slightly higher than the 5.5% average. In both the capital city and regional housing markets stock turn-over is slowing. </p>
<p><img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/10/26/Total.jpg" alt=""></p>
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<p>Housing turnover is impacted by supply and demand factors. From the demand side of things the contributors are the rate of population growth, growth in household incomes, levels of investor demand and accessibility to credit. </p>
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<p>From the supply side the factors include the level of new housing construction and how much stock is actually available for sale at any given time. Other factors include the costs associated with buying and selling properties as well as government policies such as incentives for first home buyers.” </p>
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<p>Across the states and territories, the trends are interesting: </p>
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<p>NSW: In Sydney an historic low 4.7% of housing stock transacted over the past year and in regional NSW the figure was 5.9%. In each region turnover has slowed. </p>
<p><img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/10/26/NSW.jpg" alt=""></p>
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<p>Vic: Historic low 4.4% of Melbourne housing stock turned-over throughout the past year compared to 4.9% of regional Vic stock. Both of the regions are seeing a fall in turnover.</p>
<p><img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/10/26/Vic.jpg" alt=""></p>
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<p>Qld: Stock turnover is well above record lows in Brisbane (5.8%) and regional Qld (5.8%). Brisbane turnover is only slightly below average (5.9%) while regional Qld turnover is at average levels. </p>
<p><img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/10/26/QLD.jpg" alt=""></p>
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<p>SA: Turnover is fairly steady in SA recorded at 5.7% in Adelaide and 5.8% in regional SA. In each region turnover is slightly above long- term average levels. </p>
<p><img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/10/26/SA.jpg" alt=""></p>
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<p>WA: After a large fall over recent years, turnover has stabilised at a record low in Perth (3.6%) and has increased slightly from record lows in regional WA (4.2%). </p>
<p><img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/10/26/WA.jpg" alt=""></p>
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<p>Tas: In Hobart, 5.9% of housing stock sold last year compared to a long-term average of 5.4% annually and in regional Tas 6.1% of stock sold compared to a long-term average of 5.3% </p>
<p><img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/10/26/Tas.jpg" alt=""></p>
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<p>NT: 4.2% of housing stock transacted over the past year in Darwin and 4.7% of stock in regional NT. There has been a significant fall in turnover across the state as dwelling values have fallen.</p>
<p><img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/10/26/NT.jpg" alt=""></p>
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<p>Canberra: Over the past year, 4.8% of housing stock sold which is an historic low level. </p>
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<p>The figures are stark given just how little of the Australian housing market actually sells in any given year.</p>
<p>A big driver of the low level of turnover over the past year has been relatively low levels of stock for sale, particularly in our largest capital cities and the high costs associated with stamp duty when buying a property.</p>
<p>The impost of stamp duty discourages turnover as we have recently seen with the removal of stamp duty for first time buyers under certain price thresholds in NSW and Vic.</p>
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<p>Once removed there has been a surge in housing finance commitments by first home buyers.</p>
<p>The final consideration for the low turnover is the high cost of housing in Australia, because the cost is high it is a significant consideration for households as to whether or not to purchase a property. </p>
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Dwelling construction surges yet housing turnover falls

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<p>Building activity data for the June 2017 quarter was published by the Australian Bureau of Statistics earlier this week. The data contains additional insight to the housing construction sector, tracking quarterly dwelling commencements, completions and counts of dwellings under construction. The data is showing a softening in commencements as approvals have slowed but still heightened levels of completions and dwellings under construction. </p>
<h3>Dwelling commencements</h3>
<p>Over the June 2017 quarter, seasonally adjusted data showed that 28,087 new houses and 24,380 new units commenced construction nationally.  The number of houses commenced was 3.3% higher over the quarter but -7.1% lower than a year earlier while unit commencements were down -0.8% over the quarter and -6.6% lower over the year.  <br> <br>Year-on-year new house commencements were lower in each state and territory, recorded at: -3.5% in NSW, -7.2% in Vic, -3.1% in Qld, -10.6% in SA, -12.2% in WA, -7.0% in Tas, -29.1% in NT and -37.9% in ACT.<br> <br>Year-on-year new unit commencements were higher in NSW (3.3%), Vic (3.2%), SA (35.0%) and Tas (153.1%) and they were lower in Qld (-30.4%), WA (-40.5%), NT (-40.9%) and ACT (-17.7%).</p>
<p>Commencements for houses picked up over the quarter but are lower across all regions over the year.  Meanwhile unit commencements are trending lower in most states and territories with notable exception of NSW, Vic and Tas.  NSW and Vic have been home to the two strongest housing markets over recent years (Sydney and Melbourne) and are seeing the largest increases in population fuelling housing demand.  Meanwhile, dwelling values in Tasmania’s largest city (Hobart) are rising at the fastest rate of any capital city while stock levels are very low so it seems a supply response is occurring.</p>
<h3>Dwelling completions</h3>
<p>Seasonally adjusted data nationally shows that over the June quarter there were 28,251 houses and 25,090 units completed nationally.  Interestingly these figures are fairly closely aligned to commencements so what was completed was effectively replaced as having started construction.  Over the quarter, new house completions were down -1.2% and new unit completions were -10.2% lower.  Year-on-year new house completions were -9.0% lower and new unit completions were down -5.2%.<br> <br>State and territory data which isn’t seasonally adjusted shows that year-on-year, new house completions rose in NSW (8.6%), Qld (18.3%) and ACT (73.3%) while completions were lower in Vic (-12.8%), SA (-3.7%), WA (-45.3%), Tas (-29.8%) and NT (-44.2%).<br> <br>New unit completions increased over the year in Vic (11.1%), Qld (13.7%) and ACT (29.6%) and were lower in NSW (-20.4%), SA (-41.6%), WA (-22.3%), Tas (-40.0%) and NT (-69.9%)</p>
<p>Completions remain at high levels however, they have eased back a little.  Given that there remains a high volume of stock under construction (as we will analyse shortly) it’s anticipated that completions are likely to remain elevated for some time.</p>
<h3>Dwellings under construction</h3>
<p>At the end of the June 2017 quarter, there were 216,242 dwellings under construction nationally.  Although the number of dwellings under construction is down from its historic high of 224,314 in September 2016, it is still at an extremely elevated level.  As a comparison, the long-term average number of dwellings under construction at the end of a quarter is 106,774 and even over the past 10 years the average has been recorded at 153,545.  In June 2017, there were 62,409 new houses and 151,510 new units under construction nationally.  Again, both are well above the long-run averages of 48,329 and 38,964 respectively.<br> <br>Looking at the data across the states, at the end of the quarter the number of new houses under construction was recorded at: 17,845 in NSW, 21,401 in Vic, 8,605 in Qld, 4,726 in SA, 7,669 in WA, 1,227 in Tas, 276 in NT and 660 in ACT.  By comparison, the long-term average number of houses under construction across the states is recorded at: 13,566 in NSW, 15,186 in Vic, 7,250 in Qld, 3,681 in SA, 7,455 in WA, 1,548 in Tas, 544 in NT and 938 in ACT.  All states and territories except for Tas, NT and ACT currently have more new houses under construction than the long-term average.<br> <br>The number of new units under construction is where there is generally a substantial deviation from the long-term average.  Across the states, at the end of the June 2017 quarter the number of new units under construction was recorded at: 64,470 in NSW, 43,240 in Vic, 27,420 in Qld, 4,230 in SA, 6,360 in WA, 391 in Tas, 495 in NT and 4,904 in ACT.  Tas is the only state or territory with fewer new units currently under construction than its long-term average which is recorded at 431.  Across the remaining states, the long term average number of new units under construction is: 17,162 in NSW, 10,854 in Vic, 7,897 in Qld, 1,955 in SA, 3,382 in WA, 445 in NT and 1,235 in ACT.  The current number of new units under construction in NSW (+276%), Vic (+298%), Qld (+247%), SA (+116%) and ACT (+297%) is well in excess of double the long-term average.</p>
<p>The volume of new housing stock under construction remains at dizzying heights, albeit not quite as high as a few quarters ago.  The surge in stock under construction is being driven by units which by nature take longer to build and deliver more stock in a single project than houses. Interestingly, the number of units under construction has slowed in Vic and Qld but continues to climb in NSW.  This is probably to do with the fact that many property purchasers in NSW can simply no longer afford houses (particularly in Sydney) so units become their only housing purchase option. </p>
<h3>Conclusion</h3>
<p>Although dwelling approvals have eased from their record high levels, over recent months they have been fairly steady.  They seem to have settled at a level which is well above long-term average levels.  While this means that commencements won’t be as strong going forward they are likely to remain high relative to historic levels.  There is a significant number of new dwellings (particularly units) under construction which means that completions are likely to remain elevated for some time. Once they do fall we would expect them to stabilise at a level well above the long-term average.  With the national population increasing rapidly, these people need to be housed so although housing construction is unlikely to remain as strong as it has been recently, we do expect that a substantial volume of housing construction is likely to continue to take place.</p>
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Pipeline of housing stock has peaked but pending supply remains well above long term average levels

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<p>Regulatory moves to tighten lending to foreign buyers seem to be working, with their share in new property markets falling to a five-year low 9.5%,  according to a NAB index.</p>
<p>However, the share of foreign buyers edged up to 5.9% in established markets, albeit still near four-year lows. </p>
<p>The figures are part of NAB’s Residential Property Survey for the quarter ended September. </p>
<p>The data was cited by CoreLogic’s head of research Cameron Kusher.</p>
<p>“NAB's quarterly residential property survey indicates that there has been a big pullback in foreign demand for residential property,” Kusher tweeted. </p>
<p>NAB’s note had said that “we have maintained our view for more muted market performance going forward, particularly following our revised expectations for RBA rate hikes which have been brought forward to mid-2018 (from H2 2019)”.</p>
<p><a href="https://www.propertyobserver.com.au/images/2017/10/17/NABForeignDemand.png" target="_blank">Click to enlarge</a></p>
<p><img src="https://www.urban.com.au/images/2017/10/17/NABForeignDemand.png" alt=""></p>
<p>Victoria had the lowest foreign buying activity in new property markets, where the share of sales to foreign buyers fell to 14.4% (20.8% in Q2). </p>
<p>Foreign buyers were also noticeably less prevalent in NSW, where their market share fell to 7.8% - its lowest level since Q1 2012 and down from 12.0% in Q2. The proportion of foreign buyers in new property markets also fell in WA to 4.5% (6.9% in Q2). In contrast, foreign buyers increased their market share in Queensland to 11.4% (8.6% in Q2) despite the introduction of a foreign investor land tax surcharge in July 2017. </p>
<p><a href="https://www.propertyobserver.com.au/images/2017/10/17/NABgraph2.png" target="_blank">Click to enlarge</a></p>
<p><img src="https://www.urban.com.au/images/2017/10/17/NABgraph2.png" alt=""></p>
<p><a href="https://www.propertyobserver.com.au/images/2017/10/17/NABgraph3.png" target="_blank">Click to enlarge</a></p>
<p><img src="https://www.urban.com.au/images/2017/10/17/NABgraph3.png" alt=""></p>
<p>In established housing markets, the overall share of foreign buyers rose a little from 5.6% to 5.9% in Q3, but remained anchored at near 5-year lows. </p>
<p>Foreign buyers accounted for a smaller share of sales in Victoria (8.0% in Q3 vs. 9.0% in Q2), NSW (5.6% vs. 5.9%) and WA (4.2% vs. 4.5%). </p>
<p>In Queensland, however, they accounted for 6.7% of established property sales, up from 3.8% in Q2. </p>
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NAB survey indicates pullback in foreign buyers: CoreLogic's Cameron Kusher 

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<p>Each quarter the Reserve Bank (RBA) publishes household finances data which look at the ratio of household debts and assets to disposable income. The latest data shows households are becoming more indebted at the same time as the value of their assets are increasing.</p>
<p>According to the RBA, the ratio of household debt to disposable income was recorded at 193.7% at the end of June 2017.  The ratio sits at a record high having increased by 2.0% over the quarter and by 3.9% over the year.  Unsurprisingly, most of this debt is housing related; the ratio of housing debt to disposable income is recorded at 136.4% having increased by 1.4% over the quarter and 3.9% over the year.  </p>
<p>The first chart highlights how much household and housing debt has increased over time relative to disposable incomes.  It is also noticeable that since the financial crisis the rate of escalation has slowed.  Further data from the RBA reveals that of the 136.4% ratio of housing debt to disposable income, 103.2% is held by owner occupiers with the remaining 33.2% held by investors.</p>
<p><img src="https://www.corelogic.com.au/sites/default/files/styles/article_image_570w_/public/2017-10/2017-10-09-ppimage1.png" alt="2017-10-09--ratioofhouseholdandhousingdebttodisposableincome" width="570" height="272"></p>
<p>The second chart details the ratio of household and housing assets to disposable income.  At the end of June 2017 the ratio of household assets to disposable income was recorded at 935.6% and the ratio of housing assets to disposable income was 516.5%, both of which were record highs.  Over the past year household assets and housing assets have increased by 6.6% and 7.8% respectively, well in excess of the increase in household and housing debt. </p>
<p><img src="https://www.corelogic.com.au/sites/default/files/styles/article_image_570w_/public/2017-10/2017-10-09-ppimage2.png" alt="2017-10-09--ratioofhouseholdnadhousingassesttodisposableincome" width="570" height="281"></p>
<p>By comparing the ratios of assets and debt the RBA also produces ratios of household and housing debt to assets.  The data reiterates that although debt levels are high, at this stage that debt is well supported by assets which are valued substantially higher.  Over recent years the ratios of household and housing debt to assets has actually been falling.  In June 2017, the ratio of household debt to assets was recorded at 20.7% and the ratio of housing debt to assets sat at 26.4%.  </p>
<p><img src="https://www.corelogic.com.au/sites/default/files/styles/article_image_570w_/public/2017-10/2017-10-09-ppimage3.png" alt="2017-10-09--ratioofhouseholdandhousingdebttoassets" width="570" height="283"></p>
<p>A big contributor to the declining ratio of debt to assets over recent years has been the ongoing fall in interest rates to their current lows.  The RBA publishes ratios of interest payments to disposable income for household and housing debt.  The fourth chart highlights that households are paying significantly less interest currently than they were when interest rates were much higher.  At the end of June 2017 the ratio of household interest repayments to disposable income was 8.7% and for housing it was 7.1%.  Lower interest rates also mean that where there is a debt, debtors have the ability (if they choose) to maintain previous repayments which in turn means additional debt is repaid as interest rates fall.  </p>
<p><img src="https://www.corelogic.com.au/sites/default/files/styles/article_image_570w_/public/2017-10/2017-10-09-ppimage4.png" alt="2017-10-09--ratioofhouseholdandhousinginteretrepaymentstodisposableincome" width="570" height="281"></p>
<p>The data highlights that Australian households are heavily indebted, largely due to housing.  While debt levels are high, the value of household and housing assets are, at this stage, considerably greater than the level of debt.  Of course, if household and housing asset values begin to fall in the future, the accompanying debt may not fall at the same rate and that remains the main concern with the ongoing increase in household and housing debt.  Although Australia survived the financial crisis with much less damage than most other countries, it is noticeable how there was a fairly sharp rise in the ratio of household and housing debts to assets over that period.  A more sustained downturn could potentially see a much greater increase in these ratios as asset values fall but the debt against these assets remain.<br> </p>
<p><em>Cameron Kusher is head of research for CoreLogic. You can contact him <a href="https://blog.corelogic.com.au/about/"><span class="s2">here</span></a>.</em></p>
<p>To read the original article <a href="https://www.corelogic.com.au/news/household-debts-and-assets-hit-record-highs#.Wd6d5xOCyuV" target="_blank">click here</a>.</p>
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Household debt and assets reach record highs: Cameron Kusher

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<p>The Sydney housing market is starting to slow following more than five years of strong increases in dwelling values.</p>
<p>As the Sydney market slows there could be some upside for other housing markets where capital gains have been more sustainable and rental yields are higher.</p>
<p>Australia’s third largest city, Brisbane, has recently garnered more attention as a candidate for improved housing market conditions.</p>
<p>In this week’s blog we look at the historic relationship between housing market growth in Sydney and Brisbane in order to determine whether the slowdown in Sydney could translate into an acceleration in Brisbane.</p>
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<p><img src="https://www.corelogic.com.au/sites/default/files/styles/article_image_570w_/public/2017-10/2017-10-09-blogimage1.png" alt="2017-10-09--annualchangeindwellingvalues" width="570" height="198"></p>
<p>The 30 year annual change chart above tends to indicate that after a surge in Sydney dwelling values Brisbane has followed suit thereafter.  </p>
<p>Following Sydney dwelling value growth peaking at 61.7% p.a. in August 1988, Brisbane dwelling value growth peaked at an annual rate of 35.3% in February 1989.  </p>
<p>Annual growth in Sydney dwelling values also peaked in January 2002 at 20.8% with Brisbane’s rate of growth not peaking until December 2003 at 30.7%.  </p>
<p>Keep in mind that outside of these two clear examples, a rise in Sydney value growth has not necessarily been met with a rise in Brisbane (or vice versa).</p>
<p><img src="https://www.corelogic.com.au/sites/default/files/styles/article_image_570w_/public/2017-10/2017-10-09-blogimage2.png" alt="2017-10-09--sydneydwellingvaluepremiumrelativetobrisbane" width="570" height="198"></p>
<p> <br>What the growth of Sydney values in 1988 and 2001 did have in common is that they resulted in a significant gap opening between values in Sydney and Brisbane.  </p>
<p>At its peak in August 1988, Sydney dwelling values were typically 104% more than Brisbane dwellings.  </p>
<p>At its height in September 2001, Sydney dwelling values were 107% higher than Brisbane dwelling prices.  </p>
<p>Recently the chart shows that the gap between values in Sydney and Brisbane has increased and at September 2017 the differential was 86%.  </p>
<p>The long-term average premium for Sydney dwellings over Brisbane is 55% indicating that the gap remains above the long-term average.  Interestingly, even taking a shorter time-frame the average gap has been 56% over the past 20 years and a lower 41% over the past decade.</p>
<p><img src="https://www.corelogic.com.au/sites/default/files/styles/article_image_570w_/public/2017-10/2017-10-09-blogimage3.png" alt="2017-10-09--quarterlyinterstatemigrationfromnswtoqld" width="570" height="198"></p>
<p> <br>Queensland has historically been a popular migration destination for people choosing to leave New South Wales.  </p>
<p>The above chart highlights that following the surge in value growth and the widening of dwelling prices between Sydney and Brisbane, migration from New South Wales to Queensland has typically increased.  </p>
<p>Over the long-term, the average quarterly number of persons migrating from New South Wales to Queensland has been recorded at 12,376 persons.  </p>
<p>Migration from New South Wales to Queensland peaked over the March 1989 quarter at 18,259 persons and then averaged 14,461 persons per quarter from March 1989 to December 1991.  </p>
<p>Migration from New South Wales to Queensland peaked again in December 2002 at 18,129 persons and then averaged 15,392 persons per quarter from December 2002 to September 2004.</p>
<p>As migration from New South Wales to Queensland has recently picked-up, so far it has peaked at a much lower 13,487 persons over the December 2016 quarter which is only 9.0% above the long-term average.  </p>
<p>By comparison the 1989 peak saw migration to Queensland peak at 47.5% above the long-run average and the 2002 peak saw migration peak at 46.5% above the long-run average.</p>
<p><img src="https://www.corelogic.com.au/sites/default/files/styles/article_image_570w_/public/2017-10/2017-10-09-blogimage4.png" alt="2017-10-09--annualchangeinemployment" width="570" height="198"></p>
<p> <br>Unless those people migrating from New South Wales to Queensland are retirees, employment opportunities must be a key consideration.  </p>
<p>Post the 1987 boom in Sydney, New South Wales employment growth was slowing while it accelerated in Queensland.  </p>
<p>Similarly in the early 2000’s employment growth had been greater in New South Wales than in Queensland however, by June 2001 Queensland’s employment was growing at a faster annual rate than New South Wales’ with Queensland employment growth consistently stronger than New South Wales all the way until January 2008.  </p>
<p>Over this period, dwelling value growth in Brisbane had consistently been stronger than growth in Sydney.  </p>
<p>Looking more recently, New South Wales has consistently recorded stronger annual employment growth than Queensland between September 2014 and March 2017.  Since April 2017, annual employment growth in Queensland has been greater than in New South Wales.</p>
<p><img src="https://www.corelogic.com.au/sites/default/files/styles/article_image_570w_/public/2017-10/20174-10-09-blogimage5.png" alt="2017-10-09--unemploymentratetrend" width="570" height="198"></p>
<p> <br>Although employment growth is important, the unemployment rate is also a consideration.  </p>
<p>Although job creation picked up in Queensland after 1987, Queensland’s unemployment rate was consistently higher than New South Wales’ until October 1991 when it was fairly similar to that of New South Wales.  </p>
<p>By August 1992 Queensland’s unemployment rate fell below New South Wales’ and remained lower until December 1994.  </p>
<p>The New South Wales unemployment rate was then consistently lower than Queensland’s until July 2004 with Queensland’s unemployment rate remaining lower than News South Wales’ from July 2004 until late 2009 (thankyou mining boom!).  </p>
<p>From February 2010 onwards, Queensland is yet to chalk up one month in which its unemployment rate is lower than New South Wales’.  Interestingly though, the gap between the New South Wales and Queensland unemployment rate is currently lower (1.1 basis points) than it was as the Sydney housing market was peaking in August 1988 (1.5 basis points) and January 2002 (1.9 basis points).</p>
<p>The trends presented here would generally suggest that Brisbane could be well positioned for a pick-up in value growth as the Sydney housing market slows.  </p>
<p>Keep in mind though that there have been instances in the past where value growth has surged in Sydney and it hasn’t been followed by a surge in Brisbane, so a lift in Brisbane growth is no certainty.  </p>
<p>A significant gap in the cost of housing between the two cities was evident in both 1989 and 2002 and it also evident currently.  As value growth rose in Brisbane, interstate migration from New South Wales hit levels significantly above the long-term average and although interstate migration is increasing it is yet to hit anything close to those previous highs.  Employment growth is accelerating in Queensland which may encourage an increasing number of people from New South Wales to Queensland and the differential in unemployment rate is smaller than it was in 1989 and 2002.</p>
<p>One other consideration is whether the same magnitude of people leaving New South Wales for Queensland will actually settle in Brisbane.  </p>
<p>Both the Gold and Sunshine Coasts are much bigger cities in their own right than they were in 1989 and 2002 plus connectivity with Brisbane is much better than it was previously, so perhaps these migrants will be more inclined to settle on one of the Coasts rather than Brisbane.  </p>
<p>Over the 12 months to September 2017, Brisbane dwelling values have increased by 2.9% while values on the Gold Coast are 5.4% higher over the year and Sunshine Coast values are 6.6%. </p>
<p>In my opinion, before we can call a coming surge in Brisbane dwelling values we are going to need to see both more evidence that migrants are settling in Brisbane rather than the Gold and Sunshine Coasts.  Migration from New South Wales to Queensland is going to have to lift by a lot more than it has to-date.  Finally, Queensland will also need to see a sustained improvement in employment growth to lure more people across the border.</p>
<p> </p>
<p><em>Cameron Kusher is head of research for CoreLogic. You can contact him <a href="https://blog.corelogic.com.au/about/"><span class="s2">here</span></a>.</em></p>
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Sydney housing market starting to slow: will Brisbane benefit?

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<p>Indicative of the magnitude of the profits realised from property over the June 2017 quarter was property resales. Combined, resales earned sellers $18.2 billion in gross profits with the median profit recorded at $195,000. On the downside, gross resale losses totalled $469.6 million with the median loss recorded at $35,000.</p>
<p>The latest CoreLogic Pain &amp; Gain June 2017 quarter report – www.corelogic.com.au/paingain (a national profit and loss analysis of property resales over the June 2017 quarter) showed that 89.8% of dwellings which resold over the period did so for more than their purchase price; a 0.3% increase from the March 2017 quarter result of 89.5%. Of the property types to resell over the period, houses scored top billing with profit gains of 92.1%, while unit resales achieved an 87.5% gain.</p>
<p>Owner occupiers were the biggest winners in the property resale stakes with overall profits estimated at 92.3%. Investors resales earned significantly less and recorded 88.1%; Sydney was the only major region of the country in where investors were more likely to resell at a profit than owner occupiers.</p>
<p>Across the combined capital cities, a significant gap in the proportion of profit-making resales was recorded by owner occupiers and investors in a number of cities; 93.7% of owner occupiers and 90.3% of investors resold their properties for a profit over the June 2017 quarter.</p>
<h3>Proportion of total resales at a loss/gain,<br>houses vs. units, Jun 2017 quarter<br> </h3>
<p><img src="https://www.corelogic.com.au/sites/default/files/styles/article_image_570w_/public/2017-10/2017-10-06-painandgain.png" alt="2017-10-06--painandgain" width="570" height="404"></p>
<p> <br>CoreLogic research analyst Cameron Kusher said, “Investors were 4.8 times as likely to resell at a loss as owner occupiers in Melbourne, in Brisbane the figure was 2.8 times and in Canberra the figure was 3.5 times.” </p>
<p>Regional area resales also enjoyed a win. For the combined regional markets, 90.0% of owner occupiers and 83.7% of investors resold their properties for a profit over the June 2017 quarter.  A greater proportion of owner occupiers continued to resell at a profit over investors. However, the same extreme differences between the vendor types as seen across some of the capital cities was not seen in regional markets. <br> <br>Mr Kusher said, “For owner occupiers, the results show the benefits of selling in a buoyant market.  In a falling market, owner occupiers may be more prepared to sell at a loss if they are purchasing their next home at an equivalent or greater discount.  Because of taxation rules, investors may be more prepared to incur a loss because they, unlike owner occupiers, can offset those loses against future capital gains.”   </p>
<p>“Should home values fall in the future, investors, which have been increasingly active in the housing market, may be more inclined to sell at a loss and offset those losses which in turn could result in much more supply becoming available for purchase at a time in which demand for housing falls because values are declining.”  </p>
<p>Regions showing low profit-making resales continue to be headed by those linked closest to the mining and resources sector. <br>   <br>Mr Kusher said “While the June 2017 quarter results show a reduction in the proportion of profit-making sales in some of these regions, home owners seem willing to sell but there remains little demand to purchase in these regions which is resulting in a high proportion of vendors materialising losses. The regions with the lowest proportion of resales at a loss makes for interesting reading.  <br>  <br>“The Sydney and Melbourne housing markets have been powerhouses over recent years however, regions outside but adjacent to Sydney are seeing a lower proportion of resales at a loss.  Similarly in Victoria, Melbourne continues to see relatively few resales at a loss however, the proportion of loss-making resales is actually lower in both Geelong and Bendigo.”</p>
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Property resale winners outstrip the losers

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<p>Household finance data released by the Reserve Bank (RBA) each quarter looks at the ratios of household debts and assets to disposable income. The latest RBA update shows that while households debt is growing, asset wealth is simultaneously increasing. </p>
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<p>According to the RBA, the ratio of household debt to disposable income was recorded at 193.7% at the end of June 2017 and now sits at a record-high having increased by 2.0% over the quarter and by 3.9% over the year.</p>
<p>According to CoreLogic research analyst Cameron Kusher it was not surprising to see that most of this debt is housing related; the ratio of housing debt to disposable income is recorded at 136.4% having increased by 1.4% over the quarter and 3.9% over the year.</p>
<p>Kusher said, “Clearly, household and housing debt has increased over time relative to disposable incomes. Of note is that since the financial crisis, the rate of escalation has slowed.”</p>
<p>Further data from the RBA reveals that of the 136.4% ratio of housing debt to disposable income, 103.2% is held by owner occupiers with the remaining 33.2% held by investors.</p>
<p>At the end of June 2017 the ratio of household assets to disposable income was recorded at 935.6% and the ratio of housing assets to disposable income was 516.5%, both of which were record highs. Over the past year household assets and housing assets have increased by 6.6% and 7.8% respectively, well in excess of the increase in household and housing debt.</p>
<p><a href="https://www.propertyobserver.com.au/images/2017/10/05/Kusher1.png" target="_blank">Click to enlarge</a></p>
<p> <img src="https://www.urban.com.au/images/2017/10/05/Kusher1.png" alt=""></p>
<p><a href="https://www.propertyobserver.com.au/images/2017/10/05/Kusher2.png" target="_blank">Click to enlarge</a></p>
<p><img src="https://www.urban.com.au/images/2017/10/05/Kusher2.png" alt=""></p>
<p><a href="https://www.propertyobserver.com.au/images/2017/10/05/Kusher3.png" target="_blank">Click to enlarge</a></p>
<p><img src="https://www.urban.com.au/images/2017/10/05/Kusher3.png" alt=""></p>
<p><a href="https://www.propertyobserver.com.au/images/2017/10/05/Kusher4.png" target="_blank">Click to enlarge</a></p>
<p><img src="https://www.urban.com.au/images/2017/10/05/Kusher4.png" alt=""></p>
<p>By comparing the ratios of assets and debt the RBA also produces ratios of household and housing debt to assets. Mr Kusher said, “The data reiterates that although debt levels are high, at this stage debt is well supported by assets which are valued substantially higher.”</p>
<p>Over recent years the ratios of household and housing debt to assets has actually been falling. In June 2017, the ratio of household debt to assets was recorded at 20.7% and the ratio of housing debt to assets sat at 26.4%.</p>
<p>According to Kusher, a big contributor to the declining ratio of debt to assets over recent years has been the ongoing fall in interest rates to their current lows. At the end of June 2017 the ratio of household interest repayments to disposable income was 8.7% and for housing it was 7.1%. Lower interest rates also mean that where there is a debt, debtors have the ability (if they choose) to maintain previous repayments which in turn means additional debt is repaid as interest rates fall.</p>
<p>He said, “The latest household finance data from the RBA highlights that Australian households are heavily indebted, largely due to housing. While debt levels are high, the value of household and housing assets are, at this stage, considerably greater than the level of debt.”</p>
<p>“Of course, if household and housing asset values begin to fall in the future, the accompanying debt may not fall at the same rate and that remains the main concern with the ongoing increase in household and housing debt.</p>
<p>“Although Australia survived the financial crisis with much less damage than many other countries, of note was the fairly sharp rise in the ratio of household and housing debts to assets over that period. A more sustained downturn could potentially see a much greater increase in these ratios as asset values fall but the debt against these assets remain,” Mr Kusher said. </p>
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Household debt growing slower than asset wealth as both hit record highs

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<p>Earlier this week the Australian Bureau of Statistics (ABS) released their Residential Property Price Indexes for the June 2017 quarter.  </p>
<p>The data confirmed what the CoreLogic Home Value Index has already told us, the rate of growth in the housing market is slowing, particularly so in Sydney.</p>
<p>Click to enlarge</p>
<p><img src="https://www.urban.com.au/images/2017/09/29/2017-09-21-blogimage1.png" alt=""></p>
<p> <br>Over the June 2017 quarter, the ABS Index shows combined capital city dwelling prices increased by 1.9% while the CoreLogic Home Value Index showed an increase of a lower 1.6%.  </p>
<p>As the above graph shows, the results of both indices are closely aligned.  The CoreLogic data is already available to August and shows a further cooling in the rate of growth over the three months.  </p>
<p>Given this we can expect the trend towards slower growth to hold over the September 2017 quarter.  In fact, the daily movements in the CoreLogic series is suggesting Sydney values trended slightly lower over the first 20 days of September.</p>
<p>Click to enlarge</p>
<p><img src="https://www.urban.com.au/images/2017/09/29/2017-09-21-blogimage2.png" alt=""></p>
<p> <br>On an annual change basis both indices also indicate a slowing of the rate of growth.  Over the 12 months to June 2017, the ABS reports combined capital city dwelling prices rose by 10.2% while CoreLogic data shows capital city dwelling values increasing by 11.1%.  Over the 12 months to August 2017, CoreLogic data shows that dwelling value growth has slowed to 9.7% and it is expected that the ABS data once available will also show a similar slowing.</p>
<p>Click to enlarge</p>
<p><img src="https://www.urban.com.au/images/2017/09/29/2017-09-21-blogimage3.png" alt=""></p>
<p> <br>Sydney is showing clearer signs of a slowdown than other capital cities and that is evident in the above chart.  Over the June quarter, the ABS showed a change of 2.3% compared to the CoreLogic series which showed a lower 1.6% change.  The CoreLogic data to August shows increasing evidence of the Sydney market cooling with values having increased by a much lower 0.3%.</p>
<p>Click to enlarge</p>
<p><img src="https://www.urban.com.au/images/2017/09/29/2017-09-21-blogimage4.png" alt=""></p>
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<p><br>The annual series also show signs of softer growth in Sydney with ABS data recording a change of 13.8%, over the 12 months to June down from 14.4% in March.  While the CoreLogic series recorded an annual change to June of 16.4% compared to 15.5% in March. Meanwhile, the latest data for August shows that annual growth in Sydney dwelling values has slowed to 13.0%.</p>
<p>Click to enlarge</p>
<p><img src="https://www.urban.com.au/images/2017/09/29/2017-09-21-blogimage5.png" alt=""></p>
<p> <br>The above chart shows the annual change in values across each index over the 12 months to June 2017.  Despite being two different methodologies you can see that the rates of change across both metrics are quite similar.  They show strong growth in Sydney, Melbourne and Hobart, reasonably strong growth in Canberra, moderate growth in Brisbane and Adelaide and ongoing declines in Perth and Darwin.</p>
<p>Click to enlarge </p>
<p><img src="https://www.urban.com.au/images/2017/09/29/2017-09-21-blogimage6.png" alt=""></p>
<p><br>The CoreLogic Hedonic Index provides a much more timely and granular view of housing market conditions (both geographically and across product types) and the trends are interesting.  It shows a substantial slowdown in growth in Sydney and a more moderate slowing in Melbourne.  It indicates that growth has accelerated in Hobart and has accelerated marginally in Canberra and Brisbane.  </p>
<p>Adelaide values are increasing at pretty much the same rate as they were in June while the declines in Perth and Darwin are greater, quite significantly so in Darwin.</p>
<p>Overall the data highlights the value of having a selection of indices with which to analyse the market.  </p>
<p>It also shows how valuable more timely measures are.  </p>
<p>When you are analysing Australia’s single largest asset class, timely insights are extremely important to allow those participants in the housing market to be able to make accurate decisions in as close to real time as possible.</p>
<p>It’s also a timely reminder that there is no single ‘Australian’ housing market.  </p>
<p>While headline growth rates provide a macro-view on the market, each capital city and region of the country is showing its own unique housing market dynamic which is influenced by local demographic and economic trends as well as supply factors.</p>
<p><em>Cameron Kusher is head of research for CoreLogic. You can contact him <a href="https://blog.corelogic.com.au/about/" target="_blank"><span class="s2">here</span></a>.</em></p>
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Rate of growth in the housing market is slowing

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<p>The results of a recent household income and wealth survey conducted by the Australian Bureau of Statistics (ABS) are not necessarily what you’d expect according to CoreLogic research analyst Cameron Kusher.</p>
<p>He said, “The results state that higher income households are more likely to be over-indebted than lower income ones and determined those households that are over-indebted and those that are not.”</p>
<p>The 2015-16 household income and wealth survey results, which includes household debt and over-indebtedness considers a household to be over indebted if their debt is either three or more times their income, or 75% or more of the value of their assets.</p>
<p><a href="https://www.propertyobserver.com.au/images/2017/09/21/Screen%20Shot%202017-09-21%20at%2011.15.20%20am.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/09/21/Screen%20Shot%202017-09-21%20at%2011.15.20%20am.jpg" alt=""></p>
<p>Mr Kusher said, “On these measures the ABS considers 21.6% of households to be over-indebted, 51.9% of households to be not over-indebted and 26.4% of households have no debt.”</p>
<p>According to the results, households with the lowest disposable income are the least likely to be over-indebted while the fourth quintile households are most likely to be over-indebted.</p>
<p>The end results, according to Mr Kusher, is that households with higher incomes are less likely to be debt free and are more likely to be over-indebted than lower income households.</p>
<p>He said, “Lower income households are more likely to be debt- free compared to higher income households which is reflective of many lower income households having paid off their debt.</p>
<p><a href="https://www.propertyobserver.com.au/images/2017/09/21/Screen%20Shot%202017-09-21%20at%2011.15.28%20am.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/09/21/Screen%20Shot%202017-09-21%20at%2011.15.28%20am.jpg" alt=""></p>
<p>“The data shows that 94.6% of households which are either not over- indebted (37.8%) or without debt (56.8%) have no persons in the labour force which is reflective of retirees or people that are in a position to choose not to work.”</p>
<p>Households with mortgage debt are more likely to be over- indebted than those households that either rent or own their home outright; only 3.5% of households that own without a mortgage are considered to be over-indebted compared to 47.0% of household with a mortgage and 9.1% of rental households.</p>
<p>Lone person households are likely to be those persons who are living debt free (45.9%), while single family households with a couple and dependent children (10.7%) are the least likely to be living debt free.</p>
<p><a href="https://www.propertyobserver.com.au/images/2017/09/21/Screen%20Shot%202017-09-21%20at%2011.15.36%20am.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/09/21/Screen%20Shot%202017-09-21%20at%2011.15.36%20am.jpg" alt=""></p>
<p>Interestingly, the data indicates that group households are among those least likely to be over-indebted (16.2%) as well as being amongst the least likely to be without debt (20.8%).</p>
<p>Mr Kusher said, “This probably reflects the fact that university students and young professionals are most likely to live in group households while studying and prior to purchasing their own home.”</p>
<p>The data also shows that households that are over-indebted spend 24.2% of all goods and services expenditure on housing costs compared to not over-indebted households spending 16.8% of their expenditure on housing costs.</p>
<p>The report shows that on average, over-indebted households spend more than double ($150.54) each week on their mortgage repayments than households which are not over-indebted ($73.44).</p>
<p>Mr Kusher said, “Households with no mortgage debt, most of which are retiree households, are least likely to be over- indebted.</p>
<p><a href="https://www.propertyobserver.com.au/images/2017/09/21/Screen%20Shot%202017-09-21%20at%2011.15.47%20am.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/09/21/Screen%20Shot%202017-09-21%20at%2011.15.47%20am.jpg" alt=""></p>
<p>“On the other hand, higher income households with a family that have outstanding mortgage debt are those most likely to be over-indebted.”</p>
<p>“While you could say that families of working age with higher incomes are better able to service their debt, interest rate hikes or reductions in the value of their assets could have a significant impact on their ability to service their debt.”</p>
<p>Cameron Kusher is research analyst for CoreLogic. You can contact him <a href="https://blog.corelogic.com.au/about/" target="_blank">here</a>.</p>
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Almost three quarters of Australian households are indebted: Cameron Kusher

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<p>GUEST OBSERVER</p>
<p>The Australian Bureau of Statistics (ABS) released their biennial survey of household income and wealth earlier this week.  </p>
<p>The release has a huge amount of valuable data but at least initially I thought it was pertinent to look at the dwelling tenure data.  </p>
<p>The information is provided from 1994-95 up until the latest release (2015-16).</p>
<p>The tenure data is premised upon who is currently residing in the property, this is important to understand because when we look at the proportion of residents who own without a mortgage for example this doesn’t necessarily represent the total number of dwellings owned outright.  The reason being that some of those properties that are occupied by renters may be owned outright by the person who is renting that property out.</p>
<p>Click to enlarge</p>
<p><img src="https://www.urban.com.au/images/2017/09/22/2017-09-18-articleimage1.png" alt=""></p>
<p> <br>As at the 2015-16 release 30.4% of households were lived in by someone that owned that property outright.  </p>
<p>This figure was lower than the 31.4% in 2013-14 and as the above chart shows it has been steadily trending lower over recent years.</p>
<p>In fact, at the peak throughout the timeframe shown, 42.8% of households had no mortgage in 1995-96.  This is an interesting statistic when you consider than many people suggest that lower mortgage rates result in improved housing affordability.  </p>
<p>In June 1996 the standard variable mortgage rate was recorded at 9.75% compared to a mortgage rate of 5.4% in June 2016.  The ongoing decline in mortgage rates has pushed dwelling values higher and although it has made servicing mortgage debt easier it has not led to a greater proportion of the population living mortgage free.</p>
<p>Click to enlarge</p>
<p><img src="https://www.urban.com.au/images/2017/09/22/2017-0918-articleimage2.png" alt=""></p>
<p> <br>With fewer households owning their home outright, there has been an increase in the proportion of households that live in a home that they own and still carry mortgage debt.  In 2015-16, 37.1% of households had mortgage debt which has increased from 35.8% in 2013-14.</p>
<p> At its low point over the period highlighted on the chart, 28.1% of households had mortgage debt in 1995-96.  Since 2003-04, there has consistently been a higher proportion of households with mortgage debt than those without.</p>
<p>Click to enlarge</p>
<p><img src="https://www.urban.com.au/images/2017/09/22/2017-09-18-articleimage3.png" alt=""></p>
<p> <br>As the rates of outright home ownership have fallen there has been a rise in the proportion of households which are rented.  </p>
<p>Whereas outright home ownership has continued to fall and ownership with a mortgage has risen, it is interesting to note how the proportion of rental households has actually declined since the last survey.  </p>
<p>The latest data shows that in 2015-16, 30.3% of households nationally were rented compared to 31.0% in 2013-14.  Back in 1994-95 only 25.7% of households were rented.  </p>
<p>Click to enlarge</p>
<p><img src="https://www.urban.com.au/images/2017/09/22/2017-09-18-articleimage4.png" alt=""></p>
<p> <br>As the prominence of renting has increased over time, the responsibility to provide rental accommodation has increasingly fallen on private citizens rather than the public sector.</p>
<p>At its peak in 1995-96, 6.0% of households were rental properties which were rented from state housing authorities, by 2015-16 this figure had fallen to just 3.5%.  This is an important consideration for governments when considering potential changes to investment policies such as negative gearing.</p>
<p>Governments are clearly not as involved in providing housing as they have been in the past, if private citizens or companies are going to be responsible for providing that housing it is likely they will require some incentives other than just the rental income, escpecially considering how low rental yields are across Australian cities.</p>
<p>The charts presented highlight how home ownership is continuing to decline which is leading to a greater proportion of the population either being in mortgage debt or renting.  </p>
<p>As the population ages this can create challenges especially if an increasing number of Australians are retiring but still carry mortgage debt.  It also highlights that simply building more homes is not necessarily a solution to increasing home ownership rates.  </p>
<p>As we’ve seen over recent years during a housing construction boom first home buyer levels have been at near record-lows and housing investment levels have hit all-time highs.  Arresting the decline in home ownership in Australia will be no easy feat however, the data indicates that simply building more housing won’t necessarily solve the problem particularly if it isn’t at a price point which is reachable for lower and middle income earners.  </p>
<p>We would expect that over the coming years, the rate of home ownership will continue to fall especially given we have seen dwelling values continue to climb since June 2016.</p>
<p><span>Cameron Kusher is research analyst for CoreLogic. You can contact him </span><a href="https://blog.corelogic.com.au/about/" target="_blank">here</a><span>.</span></p>
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Home ownership rates continue to fall: Cameron Kusher

<p>National diversified developer Fortis has officially launched Crest &amp; Walker, its latest Brisbane apartment development, with construction now underway on the 20-storey Newstead project.</p>

<p>Award-winning builder BINAH has commenced construction on the Bureau^Proberts-designed building, which will deliver a limited collection of 65 two and three-bedroom apartments on Kyabra Street.</p>

<p>[smartcode_project:default project_id=145922 project_image_fid=373556]</p>

<p>The project marks Fortis' fourth active residential development in Brisbane, following River House, which is nearing completion, alongside projects in New Farm and Hamilton as the national developer continues to expand its South East Queensland pipeline.</p>

<p>Fortis General Manager – Development Queensland Dan Boman said Crest &amp; Walker reflects the developer's long-term commitment to delivering design-led residential projects in Brisbane's established inner-city suburbs.</p>

<p>"We're proud to be strengthening our presence in Brisbane with Crest &amp; Walker, particularly in such a sought-after lifestyle destination as Newstead," Boman said.</p>

<p>"Every Fortis project is shaped by its context, and we approach each one with the respect and care it deserves.</p>

<p>"Our focus is always on creating places that feel connected to their neighbourhood and elevate the everyday experience for residents. Newstead continues to evolve as one of Brisbane's most sought-after urban communities, and Crest &amp; Walker reflects our ambition to contribute meaningfully to that story."</p>

<p>[smartcode_project:default project_id=145922 project_image_fid=373559]</p>

<p>Positioned between Gasworks Plaza and James Street, <a href="https://www.apartments.com.au/new-apartments/crest-walker-newstead-12-kyabra-street-newstead-qld-4006">Crest &amp; Walker</a> has been designed as a boutique residential address offering privacy and generous living spaces within one of Brisbane's most established lifestyle precincts.</p>

<p>The building features a contemporary brick podium softened by integrated landscaping, while the upper levels are characterised by restrained architecture and enduring materiality. Interiors have been designed to maximise natural light, acoustic performance and long-term liveability.</p>

<p>[smartcode_project:default project_id=145922 project_image_fid=373583]</p>

<p>Residences comprise spacious two and three-bedroom floorplans, with two-bedroom apartments priced from $1.55 million and three-bedroom, half-floor residences from $3.95 million.</p>

<p>Residents will have access to a wellness-focused rooftop featuring a swimming pool, sauna, steam room, landscaped dining spaces and outdoor lounge areas overlooking Newstead and the Brisbane CBD.</p>

<p>[smartcode_project:default project_id=145922 project_image_fid=373571]</p>

<p>Sales are being managed by Slaite Projects, with Fortis expecting strong demand from owner-occupiers seeking a high-quality, design-focused apartment in one of Brisbane's most tightly held inner-city suburbs.</p>

<p>Completion of Crest &amp; Walker is slated for late 2028.</p>

<p>[smartcode_project_cta:default project_id=145922]</p>


Joel Robinson

Fortis expands Brisbane pipeline with launch of Crest & Walker in Newstead

<p>The enormity of delivering a true skyscraper in Australia's new development market is often overlooked.</p>

<p>It has taken the best part of a decade since plans for Chevron One were first unveiled, but the 52-storey tower is now complete, with residents collecting their keys and moving into what has become one of the Gold Coast's most recognisable new landmarks.</p>

<p>Rising 127 metres above Chevron Island, Chevron One stands almost twice as high as any other building on the island. Its scale places it alongside the trio of towers at Jewel, arguably the last truly significant addition to the central Gold Coast skyline when they were completed around six years ago.</p>

<p>While there are several developments underway around a similar height to Chevron One, they are more concentrated within clusters of the highest towers in the city. The fact Chevron One sits within a developing precinct, looking back at the other high-rise developments in Surfers Paradise and Broadbeach, makes it a different proposition altogether. It will certainly become a reference point on the Gold Coast skyline.</p>

<p>[smartcode_project:default project_id=6515 project_image_fid=68833]</p>

<p>Developer Bensons Property Group is behind the 52-storey tower, which has just shy of 250 apartments, along with an exhaustive list of resident amenity spread across what is the largest development site ever assembled on Chevron Island.</p>

<p>The tower has been the talk of the town for years, says Ray White Projects Gold Coast agent Caitlin Rosenboom, who is selling the remaining apartments.</p>

<p>"People have been watching Chevron One go up for years," Rosenboom says, adding that many prospective buyers have been surprised by the scale of the views once they step inside.</p>

<p>"It's only when they walk through a completed apartment that they truly understand the position of the building," Rosenboom says.</p>

<p>"The views are jaw-dropping. Whether you're looking east over the ocean, across Surfers Paradise, along the river systems or out to the hinterland, every level offers something different but equally impressive."</p>

<p>[smartcode_project:default project_id=6515 project_image_fid=360215]</p>

<p>One of Chevron One's defining advantages is its location on the eastern side of Chevron Island on Stanhill Drive, a position which protects the views forever.</p>

<p>"There's only one row of houses between Chevron One and the water, and the height restrictions along the river means views from Chevron One can never be built out,"&nbsp;Rosenboom says.</p>

<p>While new apartment developments continue to emerge across the Gold Coast, Rosenboom says opportunities to secure a completed apartment with this level of outlook are becoming increasingly rare.</p>

<p>"The size of the site is something that would be incredibly difficult to replicate today," she says.</p>

<p>"That's allowed Chevron One to deliver the sort of amenity, open space and resident facilities that very few projects can offer. There are not many completed apartment buildings on the Gold Coast right now that can compete with the combination of scale, quality and amenity."</p>

<p>[smartcode_project:default project_id=6515 project_image_fid=68839]</p>

<p>There's around 2,000 sqm of amenity solely for the use of residents of Chevron One. Club One features a uniquely shaped swimming pool that mirrors the footprint of the building itself, set within a extensively landscaped gardens. There's also an indoor pool and spa, a fully equipped gym with a Pilates room, a yoga garden, a bookable private dining area and lounge that can host up to 30 people, and a 24-hour concierge service.</p>

<p>As for the buyers, Rosenboom is fielding enquiry from everywhere: Sydneysiders and Melburnians looking at the new and off-the-plan market following the changes in the Federal Budget, as well as those looking to relocate, through to South East Queenslanders seeking either a permanent home or a weekender bolthole.</p>

<p>"The Gold Coast lifestyle continues to resonate with people relocating from the southern states, and when they see the views and the quality of what's been delivered at Chevron One, it becomes very easy for them to understand the appeal," Rosenboom says.</p>

<p>A diverse mix of one, two and three-bedroom apartments remain available, with each offering "something a little different", be it the orientation and views, configuration, or level, to suit a wide variety of buyers.</p>

<p>The remaining apartments are ready to inspect in person, by appointment.</p>

<p>[smartcode_project_cta:default project_id=6515]</p>


A decade in the making: Residents to move into Chevron One as construction wraps up

<p>A general rule of thumb in new apartment developments is that the penthouses get the rooftop.</p>

<p>It's a formula that's become commonplace across Australia's apartment market. Residents might have access to a pool, gym or barbecue facilities on a dedicated lower level, but the most desirable outdoor spaces are typically reserved for the highest-priced homes at the top of the building.</p>

<p><a href="https://www.apartments.com.au/developers/sherpa-property-group">Sherpa Property Group</a> has taken the opposite approach.</p>

<p>Rather than dedicating the rooftop to a handful of buyers, the Gold Coast developer has made it the centrepiece of its Flourish collection, creating expansive shared spaces from the best vantage point in the building.</p>

<p>The philosophy has reached its most ambitious expression at <a href="https://www.apartments.com.au/new-apartments/flourish-soleira-palm-beach-1150-1160-gold-coast-highway-palm-beach-qld-4221">Flourish Soleira</a> in Palm Beach, where two rooftop precincts connected by a skybridge will deliver one of the most extensive lifestyle offerings seen in a residential apartment project on the Gold Coast.</p>

<p>[smartcode_project:default project_id=150017 project_image_fid=374053]</p>

<p>"We're seeing a clear move toward developments that offer more than just an apartment," Sherpa Group founder Christie Leet said.</p>

<p>"People want spaces that support how they actually live, whether that's working from home, staying active, or spending time with family and friends.</p>

<p>"That's where amenity becomes critical. It's not just about what's included, but how those spaces are designed to be used every day."</p>

<p>[smartcode_project:default project_id=150017 project_image_fid=374052]</p>

<p>The breadth of amenity has already attracted buyers across multiple demographics. Younger first home buyers have been drawn to Soleira's one-bedroom apartments, a product rarely delivered in Palm Beach, while families have responded to practical inclusions such as the shallow children's pool adjoining the main lap pool and the extensive communal recreation areas.</p>

<p>Instead of a single rooftop, Soleira delivers two distinct lifestyle zones.</p>

<p>[smartcode_project:default project_id=150017 project_image_fid=372547]</p>

<p>The southern rooftop has been dedicated to wellness, featuring a gym, yoga and Pilates studio, work-from-home facilities, a wellness centre, spa, and hot and cold plunge pools.</p>

<p>The northern rooftop focuses on recreation and entertaining, incorporating a heated resort-style pool, private dining rooms, pizza ovens, barbecues, a golf simulator, children's recreation areas, and what is expected to be the Gold Coast's first rooftop basketball court, which will also double as a squash court.</p>

<p>[smartcode_project:default project_id=150017 project_image_fid=374054]</p>

<p>Beyond the rooftops, Soleira will introduce 1,500 sqm of curated retail beneath the towers, creating one of Palm Beach's first genuinely mixed-use lifestyle precincts where cafés, restaurants and convenience retail become part of residents' everyday lives.</p>

<p>Sherpa has also retained management rights across the development, allowing it to oversee the long-term operation of the building through a 24-hour concierge model. The developer is also exploring additional revenue streams within the precinct aimed at helping offset ongoing body corporate costs for residents.</p>

<p>[smartcode_project:default project_id=150017 project_image_fid=370962]</p>

<p>While Soleira is the largest project Sherpa has delivered, the rooftop-first philosophy has been evolving for several years.</p>

<p>It began with <a href="https://www.apartments.com.au/new-apartments/amargo-6-12-sixth-avenue-palm-beach-qld-4221">Flourish Amargo</a>, the first project released under the Flourish brand. Rather than competing at the ultra-luxury end of the market with oversized half-floor and full-floor residences, Sherpa focused on creating lifestyle-driven apartments supported by resort-style shared spaces.</p>

<p>Amargo introduced more than 800 sqm of rooftop amenity, combining wellness facilities, heated pools, entertaining areas, cabanas, pizza ovens and private dining spaces into what was designed as an extension of residents' homes rather than a facility used only occasionally.</p>

<p>[smartcode_project:default project_id=146527 project_image_fid=366550]</p>

<p>That approach continued with Flourish Oasis, where the same amenity-led philosophy was refined into a more boutique development. Strong demand from Sherpa's growing VIP database saw much of the project sold before it reached the broader market, reinforcing buyer appetite for apartment communities centred around shared lifestyle experiences.</p>

<p>Flourish Amargo is slated for completion mid-way-through next year, with Oasis to be delivered by late 2027. Flourish Soleira is expected to complete in 2030.</p>

<p>[smartcode_project_cta:default project_id=150017]</p>


Sherpa takes amenity to the sky as Flourish Soleira captures booming Palm Beach demand

<p>As apartment living continues to evolve across Sydney's growth corridors, the quality and distribution of shared spaces is increasingly shaping how residents experience home. Rather than functioning as add-ons, amenities are being embedded into the daily rhythm of a building, supporting everything from quiet retreat to social interaction, often within a single vertical community.</p>

<p>At <a href="https://www.apartments.com.au/new-apartments/aeris-melrose-park-nursery-street-melrose-park-nsw-2114">Aeris</a> in Melrose Park, this approach is resolved through a layered amenity offering that unfolds from ground level through to its upper podium. Developed by <a href="https://www.apartments.com.au/developers/sekisui-house-australia">Sekisui House Australia</a> in partnership with Hankyu Hanshin Properties, the project introduces 468 apartments across two towers and a mid-rise building, positioned at the highest point of the broader masterplan.</p>

<p>[smartcode_project:default project_id=426 project_image_fid=359199]</p>

<p>The amenity experience begins at street level, where two courtyards sit within a landscaped setting that connects residents to the wider network of parks and green spaces. These green spaces are not isolated pockets but part of a wider pedestrian network that links Aeris to the surrounding <a href="https://www.apartments.com.au/developments/melrose-park-nsw-2114">Melrose Park</a> precinct, including Central Park, future schools, and the Town Centre opening in July 2026. The result is a transition that moves from public to private without abrupt boundaries, allowing residents to pass through shaded, tree-lined environments before reaching the building itself.</p>

<p>Moving upward, the focus shifts to the level five podium, where the primary communal facilities are concentrated. This space brings together a 16-metre swimming pool, outdoor seating areas, and a communal BBQ zone arranged to take advantage of elevated outlooks. Seating is positioned beneath pergolas, creating pockets of shade that extend the usability of the space throughout the day. The pool edge aligns with views toward the wider district, reinforcing the sense of elevation that defines the project’s positioning.</p>

<p>In the adjacent building, this is complemented by quieter, more contemplative spaces, including an outdoor cinema set within the same level. Positioned to operate primarily in the evening, it introduces a different tempo to the shared environment, shifting from daytime activity to after-hours use without requiring separate zones.</p>

<p>[smartcode_project:default project_id=426 project_image_fid=360299]</p>

<p>The podium also accommodates an intimate private resident gym. Located on the lower levels, it gives residents convenient access to fitness facilities without leaving the building.</p>

<p>Above, the elevated podium sky deck extends the amenity offering, providing additional open-air spaces with elevated outlooks across the surrounding landscape. While more restrained in program, this upper level reinforces the project’s vertical progression, from ground-level greenery to elevated outlook, allowing residents to move between distinct spatial conditions within a single address.</p>

<p>This distribution of amenities reflects a deliberate response to how residents use space across the day. Sekisui House Australia Sales and Marketing Director Peter Kalaf points to the role these shared areas play in shaping buyer demand. Aeris has been conceived as more than a collection of apartments, with the podium pool, gym and outdoor cinema forming part of a broader lifestyle offering that extends the home beyond each individual residence.</p>

<p>[smartcode_project:default project_id=426 project_image_fid=360300]</p>

<p>What distinguishes Aeris is not the inclusion of these elements individually, but how they are arranged in relation to one another. Active, social, and passive spaces are layered vertically rather than separated, allowing residents to choose between them without leaving the building or moving far from their apartment. This proximity supports both routine use, such as a morning swim or evening workout, and more occasional gatherings, whether around the BBQ area or within the cinema setting.</p>

<p>The amenity design also sits within a broader framework of connectivity across Melrose Park. The Melrose Park Town Centre, anchored by Coles and Dan Murphys, features a mix of retail, dining, health and lifestyle offerings, bringing everyday convenience closer to residents. By the end of the year, more than five hectares of parks and open space, equivalent to around seven football fields of green space on residents' doorstep, will further enhance the precinct, allowing the internal facilities at Aeris to operate as an extension of the wider neighbourhood rather than a substitute for it.</p>

<p>Construction at Aeris continues to gather momentum, with ground floor slabs expected to be completed in late 2026 before the first sections of the buildings begin to rise above ground.</p>

<p>[smartcode_project_cta:default project_id=426]</p>


Elevated amenity anchors daily life at Aeris, Melrose Park

<p>Repeat buyers are one of the strongest measures of confidence in any apartment development.</p>

<p>At <a href="https://www.apartments.com.au/new-apartments/era-newcastle-west-124-126-bull-street-newcastle-west-nsw-2302">ERA</a> in Newcastle West, some purchasers are returning to <a href="https://www.apartments.com.au/developers/gwh">GWH</a> after living at the developer's One Apartments. Their decision to purchase again was driven by the quality of life they found after moving into their first GWH home.</p>

<p>Keith Wilton had spent years living in a house in East Maitland before deciding it was time for a change. Apartment living had always been on his radar, but he was selective about what he wanted.</p>

<p><iframe allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" allowfullscreen="" frameborder="0" height="315" referrerpolicy="strict-origin-when-cross-origin" src="https://www.youtube.com/embed/FH_1EzB-1vs?si=XScVlP1ERsTDJoME" title="YouTube video player" width="560"></iframe></p>

<p>"I had some boxes I wanted to tick," he says.</p>

<p>Keith points to the open-plan design, generous outdoor areas and considered inclusions as key reasons One Apartments worked for him.</p>

<p>“One of those things was a nice indoor open plan area, but also I wanted a nice outdoor open area that I could entertain on in summer or Christmases or birthdays,” he says.</p>

<p>He also found value in the smaller details, from integrated appliances to shared resident spaces including the pool, cinema and rooftop areas.</p>

<p>[smartcode_project:default project_id=135096 project_image_fid=356818]</p>

<p>After comparing several developments, he chose One Apartments because of GWH's longstanding local reputation and his own experience working with the developer on a commercial project more than a decade earlier.</p>

<p>"I knew that they were local, that the quality of the build was going to be up there. I'd looked at other apartment complexes around and close by, and I just knew that here was a better decision location wise."</p>

<p>Today, Keith says the move has completely changed how he experiences Newcastle.</p>

<p>"I enjoy living in this location because it's more of a lifestyle change. That Newcastle city living where you can walk to restaurants and bars and even beaches and parks and even shopping across the road."</p>

<p>[smartcode_project:default project_id=135096 project_image_fid=356828]</p>

<p>Beyond the location, he says it's the sense of community that has surprised him most.</p>

<p>"Everyone loves living here because they chose to live here, but everyone looks out for each other. It's a real great community feel here."</p>

<p>For Aimee and Lyle Goodman, the journey started almost by chance.</p>

<p><iframe allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" allowfullscreen="" frameborder="0" height="315" referrerpolicy="strict-origin-when-cross-origin" src="https://www.youtube.com/embed/tsioMLcnjas?si=zq-ys3JuWpfa5hFv" title="YouTube video player" width="560"></iframe></p>

<p>The couple happened to be having coffee in Newcastle when they noticed the site where One Apartments was about to begin construction.</p>

<p>"We were aware GWH was planning a development," Aimee says. "We made one phone call and things moved pretty quickly after that."</p>

<p>As busy business owners, they initially thought apartment living would simply reduce the maintenance that came with larger homes. Instead, it fundamentally changed how they spent time together.</p>

<p>"We actually catch up more as a family now," Aimee says.</p>

<p>"We've had homes with big yards and lots of space, but everyone ended up in different rooms. Here we'll have dinner together, the kids can play, and we spend far more quality time together."</p>

<p>[smartcode_project:default project_id=135096 project_image_fid=356829]</p>

<p>Lyle says their confidence came from GWH's reputation within Newcastle's building industry.</p>

<p>"I know people who've worked across different apartment projects, and whenever GWH came up the feedback was always the same. They're rock solid. They're quality."</p>

<p>That confidence only grew throughout the buying process.</p>

<p>"One of the things that really impressed us with GWH was the whole process, was the communication," Lyle says. "It was consistent, it was regular, there was no problem if we had some weird questions, there was no problems in getting answers."</p>

<p>[smartcode_project:default project_id=135096 project_image_fid=351104]</p>

<p>Aimee says one moment stood out.</p>

<p>"The project actually finished on time. We realised we needed to hurry up and sell our house because everything was happening exactly when they said it would."</p>

<p>The positive experience at One Apartments ultimately gave all three buyers the confidence to purchase again with GWH, this time at ERA.</p>

<p>Their confidence reflects what many buyers are seeking in today's apartment market. Location remains important, but so too does certainty around delivery, quality and long-term liveability.</p>

<p>[smartcode_project:default project_id=135096 project_image_fid=356822]</p>

<p>ERA builds on those foundations with 280 one, two and three-bedroom apartments across two landmark towers in <a href="https://www.apartments.com.au/developments/newcastle-west-nsw-2302">Newcastle West</a>.&nbsp;</p>

<p>Designed by <a href="https://www.apartments.com.au/architects/fk-australia">Fender Katsalidis</a>, the project will include more than 2,000 square metres of resident amenities, including a resort-style pool, gym, sauna, private cinema and rooftop entertaining spaces overlooking the harbour and coastline.&nbsp;</p>

<p>The development is also within walking distance of the Newcastle Interchange, Honeysuckle, Darby Street, the harbour foreshore, restaurants, retail and the city’s beaches, continuing the walkable lifestyle that existing GWH buyers say has transformed how they live.</p>

<p>[smartcode_project:default project_id=135096 project_image_fid=356826]</p>

<p>For Keith, the appeal remains straightforward.</p>

<p>"You feel at home even before you've moved into your home."</p>

<p>For Aimee, the change is measured in time.</p>

<p>“I just felt like I had more time,” she says.</p>

<p>[smartcode_project:default project_id=135096 project_image_fid=351102]</p>

<p>Construction at ERA is now underway, with more than half of the residences already sold and limited two and three-bedroom apartments remaining in the East Tower release. Priced from $980,000 for two-bedroom residences and $1.46 million for three-bedroom residences, buyers can secure an apartment with a 10 per cent deposit, with premium homes offering ocean views from Level 8 and harbour views from Level 10.</p>

<p>ERA is also backed by Resilience Insurance's 10-year Latent Defects Insurance policy, providing protection against structural or waterproofing defects for 10 years after completion. The project is anticipated to be completed in early 2028.</p>

<p>[smartcode_project_cta:default project_id=135096]</p>


Cameron Kusher

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