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Although values have been increasing for almost 4.5 years, homes continue to sell quite rapidly with a relatively low level of discounting occurring from vendors.
The vendor discount and time on market metrics are important measures of current market conditions. The vendor discounting metric looks at properties selling for less than their original list price and looks at the percentage difference from initial list price to ultimate sale price. 
The time on market metric shows the average number of days between when a property is first listed and when it ultimately sells. It’s important to note that each of these measures is based on private treaty sales and therefore excludes auctions.
In September 2016, the average days on market across the combined capital cities was recorded at 39 days. At the same time a year earlier the average days on market was a slightly lower 36 days. 
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<h3>Average days on market, combined capital cities</h3>
<a href="/images/2016/11/23/2016-11-17--pp-image1.png" target="_blank">Click to enlarge</a>
<img src="/images/2016/11/23/2016-11-17--pp-image1.png" alt="">
The second chart highlights the average days on market figure across each of the capital cities for each of the past 8 years in September. Over recent years homes have been selling much quicker in Sydney and Melbourne than they have across the other capital cities. Homes in Hobart and Canberra have seen fairly large falls in days on market over the past year which aligns with accelerating value growth. In Perth and Darwin homes have seen a large rise in the average days on market as selling conditions have become tougher and values have declined.
<h3>Average days on market, individual capital cities as at September </h3>
<a href="/images/2016/11/23/2016-11-17--image2.png" target="_blank">Click to enlarge</a>
<img src="/images/2016/11/23/2016-11-17--image2.png" alt="">
In September 2016, the typical home which sold at a discount from its original listing price was discounted by -5.7 percent across the combined capital cities. In comparison, at the same time a year earlier the typical level of discounting was recorded at -6.0 percent. The lower level of discounting is reflective of more demand and fewer homes for sale but is also likely to reflect more realistic initial listing prices from vendors.
<h3>Average vendor discount, combined capital cities</h3>
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<img src="/images/2016/11/23/2016-11-17--pp-image3.png" alt="">
The final chart shows the discounting levels for each capital city in September over each of the past 8 years. Once again Sydney and Melbourne, along with Canberra, have been seeing low levels of discounting by vendors over recent years. In Sydney and Melbourne in particular this is indicative of strong housing demand which has led to many homes selling in excess of their initial list price. Despite only moderate growth in values over recent years Canberra has consistently recorded low levels of discounting. In Perth and Darwin as the housing market has wakened over recent years discounting levels have increased significantly.
<h3>Average vendor discount, individual capital cities as at September</h3>
<a href="/images/2016/11/23/2016-11-17--image4.png" target="_blank">Click to enlarge</a>
<img src="/images/2016/11/23/2016-11-17--image4.png" alt="">
After combined capital city home values have been increasing for almost four and a half years (mainly in Sydney and Melbourne) the level of discounting and time on market remains extremely low. This is being driven by ongoing strong housing demand coupled with relatively low stock levels.  While these conditions persist it is difficult to see how home values in Sydney and Melbourne in particular, won’t continue to increase.
Cameron Kusher is research analyst for CoreLogic. You can contact him <a href="https://blog.corelogic.com.au/about/">here</a>.
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Homes are selling much quicker in Sydney and Melbourne: Cameron Kusher

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As commodity prices and mining investment has sunk, demand for housing in mining areas has also slowed. This week we take a look at the performance of some of the major mining towns.
Mining towns and regions across the country have been hard hit as investment and commodity prices have slumped.  This week we’re looking at how the housing market has performed in terms of the volume and median price of sales across these regions.  The results indicate that not all mining towns have recorded an equivalent slowdown.  The following analysis looks at annual median prices and annual sales volumes
Port Hedland – median prices peaked at $925,000 in June 2013 and sales volumes peaked at 402 in July 2006.  Current median prices are $390,000 (-58 percent lower than peak) and current sales are 128 (-68 percent below peak).  In what may be a positive sign for the market, annual sales are once again trending higher, although the median prices trend is yet to bottom out.
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<img src="/images/2016/11/09/2016-11-07--image1.jpg" alt="">
Isaac – median prices peaked at $620,000 in November 2012 and sales volumes peaked at 661 in March 2012.  Current median prices are $138,390 (-78 percent lower than peak) and current sales are 117 (-28 percent below peak).  Transaction numbers have recently started to rise, however median price trends remain negative.
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<img src="/images/2016/11/09/2016-11-07--image2.jpg" alt="">
Karratha – median prices peaked at $815,000 in October 2010 and sales volumes peaked at 511 in March 2005.  Current median prices are $362,980 (-55 percent lower than peak) and current sales are 235 (-54 percent below peak).  Transaction numbers have been trending higher but the median sale price is still falling, albeit at a more moderate pace.
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<img src="/images/2016/11/08/Screen%20Shot%202016-11-08%20at%2012.25.26%20PM.png" alt="">
Gladstone – median prices peaked at $475,000 in September 2012 and sales volumes peaked at 1,823 in July 2007.  Current median prices are $350,000 (-26 percent lower than peak) and current sales are 572 (-69 percent below peak).  Dwelling turnover is continuing along a downwards trend with no sign of an improvement in buyer demand just yet.
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<img src="/images/2016/11/09/2016-11-07--image4.jpg" alt="">
Kalgoorlie-Boulder – median prices peaked at $351,250 in June 2015 and sales volumes peaked at 1,656 in September 2006.  Current median prices are $312,000 (-11 percent lower than peak) and current sales are 345 (-79 percent below peak).  Transaction numbers appear to be levelling, however there is no sign of any upwards pressure on prices or turnover.
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<img src="/images/2016/11/09/2016-11-07--image5.jpg" alt="">
Mackay – median prices peaked at $435,000 in June 2013 and sales volumes peaked at 3,264 in April 2004.  Current median prices are $345,000 (-21 percent lower than peak) and current sales are 1,045 (-68 percent below peak).  Transaction numbers have recently levelled across the Mackay housing market but are yet to improve.
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<img src="/images/2016/11/09/2016-07-11--image6.jpg" alt="">
Roxby Downs – median prices peaked at $500,016 in November 2013 and sales volumes peaked at 187 in February 2004.  Current median prices are $250,000 (-50 percent lower than peak) and current sales are 23 (-88 percent below peak).  Transaction numbers have recently increased slightly across Roxby Downs.
<a href="/images/2016/11/09/2016-11-07--image7.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/11/09/2016-11-07--image7.jpg" alt="">
The smaller mining townships which don’t act as major service centres have tended to see a much sharper fall in median selling prices than the larger townships.  The decline in sales and prices from the market peaks has been substantial across all of these regions, however the regions that have seen the most significant downturn were those that also recorded a significant upswing in prices and turnover rates prior to the peak in commodity prices.
Recently, most of these mining towns have experienced a stabilisation in sales with some regions having seen an increase in sales volumes.  Although sales may have broken the declining trend in a number of areas, median selling prices are generally continuing to trend lower across each of the regions highlighted.
The improvement in transactional activity could potentially be due to larger numbers of distressed sales moving through these markets, but may also be attributable to a cautious return of buyers seeking out a bargain.
The challenge for many of these regions remains that despite a recent uptick in commodity prices, investment in large infrastructure projects (new mines, processing facilities, transport etc) has dried up and subsequently few additional jobs are being created. 
Although commodity prices have recently surged, particular iron ore, coking coal and thermal coal, it is not yet leading to a substantial increase in exploration activity or employment, subsequently housing demand remains weak and continues to have a dampening effect on housing prices. 
Cameron Kusher is research analyst for CoreLogic. You can contact him <a href="https://blog.corelogic.com.au/about/">here</a>.
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The lowdown on the mining town slowdown from Gladstone to Karratha

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GUEST OBSERVER
The Australian Bureau of Statistics (ABS) released consumer price index (CPI) data for the September 2016 quarter last month. 
According to the data, headline inflation increased by 0.7 percent over the quarter to be 1.3 percent higher over the year. 
Meanwhile, underlying inflation was recorded at 0.3 percent over the quarter and 1.5 percent higher over the past 12 months. Both headline and underlying inflation have increased at a rate below the RBAs target range of 2 percent to 3 percent. 
This would usually see the RBA cut interest rates to try and lift inflation however, the previous cuts in May and August, which had the same intent, have not successfully lifted inflation. 
What those cuts did manage to do was re-energise growth in housing, particularly in Sydney and Melbourne. 
For this reason there is some speculation as to whether the RBA will risk cutting interest rates again given concerns that a lower cash rate will fail to push the dollar lower and lift inflation but add further heat to an already strong housing market.
With the CPI data released, we can pair it with the CoreLogic home value index data to September 2016, in order to obtain an understanding of real growth in values. 
Although headline value growth is lower than it was a year ago, so too is headline inflation which mean that real value growth, particularly in Sydney and Melbourne remains strong.
<a href="/images/2016/10/31/CoreLogic%201.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/10/31/CoreLogic%201.jpg" alt="">
The above chart highlights the real and nominal changes in home values across each capital city over the 12 months to September 2016.  In both real and nominal terms values have fallen over the past year in both Perth and Darwin while they have increased across each of the remaining capital cities. 
There’s also been evidence that along with Sydney and Melbourne, where growth has been strong for almost four years now, value growth has also picked up in other cities such as Adelaide, Hobart and Canberra.
<a href="/images/2016/10/31/CoreLogic%202.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/10/31/CoreLogic%202.jpg" alt="">
If you look at the compound annual change in real home values over the past five, ten and 15 years, the 15 year time-frame in most capital city provides the strongest performance. 
The clear exception is in Sydney where the last five years have resulted in the strongest annual returns.  In contrast, across all other capital cities except for Perth and Hobart the past five years have recorded the weakest annual growth across each of the three time-frame. 
This result really highlights the strength of the Sydney market over the past five years and its relative weakness over the 10 years preceding.
<a href="/images/2016/10/31/CoreLogic%203.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/10/31/CoreLogic%203.jpg" alt="">
Since the end of 2008 (ie post GFC), growth in home values has significantly skewed towards the Sydney and Melbourne housing markets. 
As highlighted in the above chart, when adjusted for inflation values are lower that they were at the end of 2008 in Brisbane, Adelaide, Perth, Hobart and Darwin. 
Sydney and Melbourne have also seen a substantially greater increase in values relative to Canberra which was the only other capital city to have seen an increase in real home values.
<a href="/images/2016/10/31/CoreLogic%204.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/10/31/CoreLogic%204.jpg" alt="">
Sydney and Melbourne are the only two capital cities in which real home values are now back above their previous peaks. 
After peaking all the way back in the March 2004 quarter, real home values in Sydney are now 35.3 percent higher in Sydney and in Melbourne they are 17.2 percent higher than their September 2010 peak. 
All other capital cities are still recording real home values below their previous peaks.  The magnitude of these declines are recorded at: -10.2% in Brisbane, -5.3 percent in Adelaide, -20.2 percent in Perth, -15.6 percent in Hobart, -23.8 percent in Darwin and -1.0 percent in Canberra. 
In some of these cities, values peaked many years ago, as far back as 2007 in Perth and Hobart and 2008 in Brisbane.
Although interest rates are low and in real terms homes have been becoming more affordable outside of Sydney and Melbourne it still hasn’t proved to be enough to lure substantial demand and subsequent growth across the other capital cities. 
What this highlights is the importance of employment, what sets Sydney and Melbourne apart, outside of more expensive housing prices, is the fact that they both have strong economies which are creating jobs. 
Housing affordability alone is no longer enough to attract an increasing level of housing demand, you need a strong economy and the jobs that go along with those strong economic conditions.
Perth and Darwin in particular are well into a fairly substantial value decline phase which is appears set to continue.  Since their respective market peaks in September 2007 and September 2010, real home values are now -20.2 percent and -23.8 percent lower respectively.
Cameron Kusher is research analyst for CoreLogic. You can contact him <a href="https://blog.corelogic.com.au/about/">here</a>.
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Home values now more than 20 percent down in Perth and Darwin

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GUEST OBSERVER
The almost 4.5 year growth phase in capital city home values have driven prices higher and this week we look at the now significant premium for housing in Sydney and to a lesser degree the premium in Melbourne.
CoreLogic calculates capital city median selling prices on a rolling three month basis. 
As at September 2016, the combined capital city median house price was recorded at $600,000 and the median unit price was $510,000. 
Importantly, because a median is based on sales and transactions that are mostly occurring in Sydney and Melbourne, this figure is heavily influenced by these two cities.
<a href="/images/2016/10/25/Quarterly%20median%20house.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/10/25/Quarterly%20median%20house.jpg" alt="">
With home values rising at a much stronger rate in Sydney and Melbourne there is increasingly a significant premium for housing across these two cities. 
The median house price in Sydney is recorded at $890,000 and the median unit price is $675,000.  In Melbourne, median price are recorded at $641,500 for houses and $485,100 for units.
<a href="/images/2016/10/25/Sydney%20Vs%20Melbourne%20units.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/10/25/Sydney%20Vs%20Melbourne%20units.jpg" alt="">
The second chart highlights Sydney median unit prices and Melbourne median house prices over time.  Interestingly, Sydney units have regularly been more expensive than Melbourne houses and this remains the case currently. 
In fact, Sydney median unit prices have consistently been higher than Melbourne median house prices since February 2012.
Looking at median selling prices of houses over the September quarter across the individual capital cities shows a substantial premium in Sydney. 
Across the cities, median prices were recorded at: $890,000 in Sydney, $641,500 in Melbourne, $505,000 in Brisbane, $440,000 in Adelaide, $480,000 in Perth, $349,500 in Hobart, $500,000 in Darwin and $625,000 in Canberra. 
The median house price in Sydney is 39% higher or $248,500 more expensive than median prices in the second most expensive city, Melbourne. 
Although the premium for Sydney housing is rising and wide on an historic basis, the Sydney premium (in percentage) terms was higher than it is currently for all capital cities back in late 2003.
<a href="/images/2016/10/25/Quarterly%20median%20selling%20house.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/10/25/Quarterly%20median%20selling%20house.jpg" alt="">
Turning to the median selling price of units, we’ve already noted that Sydney median unit prices are higher than median house prices in all other capital cities at $675,000. 
Elsewhere median unit prices are recorded at: $485,100 in Melbourne, $390,000 in Brisbane, $351,500 in Adelaide, $410,000 in Perth, $283,000 in Hobart, $440,000 in Darwin and $421,000 in Canberra. 
Sydney’s median unit price is $189,900 or 39% higher than Melbourne’s. 
As with houses, although the Sydney unit premium is substantial, in percentage terms it has been greater in the past.  
<a href="/images/2016/10/25/Quarterly%20median%20selling%20units.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/10/25/Quarterly%20median%20selling%20units.jpg" alt="">
Although the gap in housing costs has been greater in the past, in dollar value terms it is substantial.
And is likely to be a challenge in the future. Housing in Sydney and Melbourne has become more expensive than elsewhere in the country due to much stronger job and broad economic conditions.
Despite these factors we anticipate that the substantial cost of housing in Sydney will make it a less desirable location for people to migrate to. 
The latest demographic data shows that a greater number of net overseas migrants are choosing to move to NSW rather than Vic. 
Meanwhile, net interstate migration into Vic is at a record high while the outflow from NSW is historically low but has started to pick-up.
We expect that migration, particularly interstate migration, into Vic (which is a proxy for Melbourne) will continue to rise while over the coming years while it is anticipated to slow into NSW (as a proxy for Sydney).
Housing costs are likely to be one of the key drivers of this change. While both economies are strong and creating jobs we expect that more interstate migrants will be attracted to Melbourne due to its substantially more affordable housing costs, rather than Sydney.
Outside of Sydney and Melbourne, cheaper housing alone is proving not enough to attract people to these cities.
This highlights the importance of a strong economy with decent employment prospects and shows that housing affordability alone is no longer enough of a lure to attract migrants to a region.
Cameron Kusher is research analyst for CoreLogic. You can contact him <a href="https://blog.corelogic.com.au/about/">here</a>.
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Analysing the Sydney housing price premium: Cameron Kusher

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Earlier this week, housing finance data for August 2016 was released by the Australian Bureau of Statistics (ABS). 
Over the month there was $31.4 billion worth of housing finance commitments which was -1.0 percent lower over the month and -5.1 percent lower than it was at its peak in April 2015.
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The $31.4 billion worth of commitments in August was split between $19.5 billion worth of commitments by owner occupiers and $11.9 billion in commitments to investors.
The value of lending to owner occupiers has fallen over two consecutive months while lending to investors has risen for the fourth consecutive month.  The value of lending to owner occupiers is now -8.6 percent lower than its peak in December 2015. 
Investor lending remains well below its April 2015 peak, down -18.5 percent however, the recent rebound has seen the value of investor lending increase by 10.0 percent from its recent trough in April 2016.
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The $19.5 billion worth of mortgage borrowing by owner occupiers was comprised of: $1.8 billion for construction of dwellings, $1.0 billion for purchase of new dwellings, $6.4 billion for refinancing of established dwellings and $10.2 billion for purchase of established dwellings. 
The two largest components of owner occupier lending; refinancing and purchase of established dwellings, have both trended lower over recent months. 
The value of refinance lending is -13.4 percent lower than its peak of $7.4 billion in December 2015 and purchase of established dwellings is -11.2 percent lower than its $11.5 billion peak in September 2015. 
With an interest rate cut which wasn’t passed on in full by most lenders in August, there is a decent probability that refinance activity will increase over the coming months.
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<img src="/images/2016/10/13/chart-3-580x211.jpg" alt="">
For investors there was $11.9 billion in mortgage lending in August 2016, which was split between $0.9 billion in lending for construction and $11.1 billion for established housing. 
The value of lending for construction was at its lowest level since September 2015 and down -49.5 percent from its recent peak of $1.7 billion in March 2016. 
The $11.1 billion in lending for established housing has increased over four consecutive months and is at its highest level since August 2015. 
Housing credit data also highlights the recent up-tick in investor mortgage lending with monthly investor credit data increasing over each of the five months to August 2016.
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<img src="/images/2016/10/13/chart-4-580x214.jpg" alt="">
Focusing solely on new construction which includes owner occupier construction of dwellings, owner occupier purchase of new dwellings and investor lending for construction, there was $3.7 billion in lending in August 2016. 
The $3.7 billion was the lowest value of lending for new housing since September 2015 with lending for new housing having trended lower since March 2016.  Based on this data, only 14.9 percent of the total value of housing finance commitments in August 2016 were for new housing. 
Of the $3.7 billion, 23.1 percent of lending was to investors.
The trends ae emerging whereby demand from the investment segment is increasing again while owner occupier demand is slowing. Although investment demand is lifting, it is not expected to lift to the substantial levels recorded earlier in the current housing cycle. 
The fading demand from owner occupiers reflects that many have already upgraded or downgraded in the current cycle as much as the fact that particularly in Sydney and Melbourne it is probably getting a little harder to justify a move in the context of significant transactional costs. 
When owners look at the cost of upgrading and the market exit cost (agent commission etc) and entry costs (stamp duty) many are probably now considering a renovation as a better option than moving.
Housing market listings have increased in spring and over recent months auction volumes and clearance rates have also increased.  It will be interesting to see whether this translates into a lift in housing finance commitments over the coming months as the data becomes avaialable.
Cameron Kusher is research analyst for CoreLogic. You can contact him <a href="https://blog.corelogic.com.au/about/">here</a>.
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Investor housing demand rises as owner occupier fades: CoreLogic

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Looking at median selling prices over the past decade, the national median house price ten years ago was recorded at $330,000, while the median unit price was $310,000.
Ten years on, and the median selling prices are now $499,000 and $445,000 respectively.
What we’re seeing here is a selling price increase of 51 percent for houses over the decade and by 44 percent for units. Clearly, based on broad averages, in most areas of the country median prices have not doubled over the past decade.
Across individual capital cities the results diverge significantly, however none of the capital cities have seen the city-wide median house or unit prices double over the past decade. Prices have gone closest to doubling over the decade in Sydney, Melbourne and Darwin while in Perth and Hobart the total change for houses and units has been well below 50 percent.
<a href="/images/2016/10/11/Screen%20Shot%202016-10-11%20at%208.27.01%20AM.png" target="_blank">Click to enlarge</a>
<img src="/images/2016/10/11/Screen%20Shot%202016-10-11%20at%208.27.01%20AM.png" alt="">
A granular look at the housing market reveals 4,048 individual suburbs that had at least 10 house sales over the 12 months to both June 2006 and June 2016 and 1,665 suburbs that had at least 10 sales over both periods for units. Of the 4,048 suburbs nationally for houses, only 573 suburbs or 14% have seen the median selling price of a house double over the past decade. For units, only 159 of the 1,665 suburbs nationally, or 10 percent, have seen median prices of units double over the past decade.
A split of suburbs that have, and have not, seen median selling prices double over the past decade across each state and territory includes:
• Houses: NSW, Vic and NT are the only states and territories in which more than 10 percent of suburbs have seen prices double over the past 10 years.;
• Units: again only NSW, Vic and NT saw more than 10 percent of suburbs recording prices as doubling;
• Not one suburb in Tasmania has seen a doubling in median price over the past decade.
<a href="/images/2016/10/06/Number%20of%20suburbs%201.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/10/06/Number%20of%20suburbs%201.jpg" alt="">
An overview of the capital growth performance for capital city suburbs over the past decade shows:
• For houses: Melbourne is the only city where half of the individual suburbs saw median selling prices double over the past decade while Sydney has also seen more than 40 percent of suburbs doubling in price. Darwin is the only other capital city where more than 10 percent of suburbs have seen selling prices of houses at least double over the past 10 years.
• For units: once again Sydney, Melbourne and Darwin are the only capital cities in which selling prices have more than doubled in at least 10 percent of suburbs.
<a href="/images/2016/10/06/Number%20of%20suburbs%202.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/10/06/Number%20of%20suburbs%202.jpg" alt="">
A comparison of the two adjacent tables highlights just how much stronger price growth has been in the capital cities than across regional markets.
It also highlights just how much the strong growth over the decade has been tilted towards Sydney, Melbourne and Darwin. Of course, values are already declining in Darwin while they continue to rise in Sydney and Melbourne.
The next time you hear of property prices doubling every seven to ten years, although it can happen in certain areas, there are no guarantees.
The CoreLogic analysis highlights the importance of buying strategically; on average most properties have fallen well short of doubling their value over a decade. Using today’s data as an example, it highlights that far fewer owners have seen their real estate asset double in price over the past decade than those who have.
For those who have seen their property price double over the decade, they are most likely to be situated in Sydney, Melbourne or Darwin while in other capital cities and regional areas of the country the prospects of prices having doubled over this period are much lower.
Cameron Kusher is research analyst for CoreLogic. You can contact him <a href="https://blog.corelogic.com.au/about/">here</a>.
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Does property double over 10 years? CoreLogic's Cameron Kusher

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GUEST OBSERVER
Resource towns have typically seen the lowest turnover over the past 12 months while lifestyle markets and new housing areas are seeing relatively higher levels of turnover.
Across the nation, the number of residential properties sold has reduced over the past year. This trend has been reflected across most capital cities and major regional areas of the country. One of the main reasons behind the decline in sales has been a reduction in stock becoming available for sale.
In addition to fewer homes being available for sale, lending conditions have also tightened and affordability constraints are preventing some market segments from being more active.
Over the 12 months to June 2016, just 4.9% of total dwelling stock nationally transacted. Based on this figure it would take around 20.5 years for the total national housing stock to turnover.
The low turnover rate also highlights why price based measurements such as median prices aren’t the most reliable for tracking value movements across the housing market given that so little of the total housing stock actually transacts in any given year.
The turnover figure is different to the often quoted average hold period figure. Turnover looks at the proportion of total stock which is selling while the hold period calculation looks only at those homes transacting and measures the length of time between sales. The two figures highlight that there are properties which transact on a more regular basis while there are others which rarely sell.
The first table highlights the 25 council areas nationally that had the lowest turnover of housing stock over the year to June 2016. What is immediately noticeable from the list is the prevalence of regions linked the resources sector.
These areas have been characterised as having plenty of willing sellers of properties but relatively few people actively looking to buy. This is reflected by the fact that in some of these regions only a small overall proportion of housing stock has actually transacted.
<a href="/images/2016/10/04/Lowest%20level%20of%20turnover.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/10/04/Lowest%20level%20of%20turnover.jpg" alt="">
The second table shows the 25 council regions that have recorded the greatest turnover of housing stock over the past year. This list of suburbs is slanted towards coastal/lifestyle markets. It also includes a number of council areas in which there has been significant housing supply additions over the year.
The heightened level of turnover in lifestyle markets indicates that the popularity of purchases in these markets has returned after many years in the doldrums.
<a href="/images/2016/10/04/Highest%20level%20of%20turnover.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/10/04/Highest%20level%20of%20turnover.jpg" alt="">
Cameron Kusher is senior research analyst at <a href="https://www.myrp.com.au/">RP Data</a>.
 
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Wingecarribee the busiest district for turnover of housing stock: CoreLogic

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The Australian Bureau of Statistics has released the latest building approvals data for August 2016. 
The data showed that the strength in residential dwelling approvals is continuing. 
Over the month there were 20,788 dwellings approved for construction which was a moderate -1.8 percent lower over the month but 10.1 percent higher than the number in August last year.
<a href="/images/2016/10/04/Chart-1-580x211.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/10/04/Chart-1-580x211.jpg" alt="">
The 20,788 dwelling approvals were split between 9,475 houses and 11,313 unit approvals.  Over the past year, on seven occasions there have been more units approved for construction than houses which highlights the growing shift towards densification with a particular emphasis on high rise unit developments.  The number of houses approved for construction fell by -0.9% over the month to its lowest level since March 2014. 
House approvals in August 2016 were -5.8% lower than at the same time in 2015.  The number of units approved for construction was slightly lower over the month, down -2.5% however, compared to the number in August 2015 they were 28.3% higher. 
Despite the slight fall in approvals over the month they still remain at very high levels on an historic basis indicating that there remains a level of confidence from property developers that they can continue to bring new stock to the market and attract a sufficient level of demand to make a profit.
<a href="/images/2016/10/04/Chart-2-580x212.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/10/04/Chart-2-580x212.jpg" alt="">
Focusing on unit approval over the month, 26.9 percent of all approvals were for townhouses, 5.1% were low-rise units (defined as less than four storeys) and 68.0 percent were for high-rise units (four storeys or higher). 
To highlight the prevalence of high-rise unit development, if we look over the four years to August 2016 there have been 112,153 townhouses approved for construction, 43,471 low-rise units and 232,232 high-rise units. 
High-rise unit approvals over that four year period have been more than double the number of townhouse approvals which historically been the dominant type of unit approval.
<a href="/images/2016/10/04/Chart-4-1-580x209.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/10/04/Chart-4-1-580x209.jpg" alt="">
Across the combined capital cities, there were 16,763 dwellings approved for construction in August 2016.  Capital city dwelling approvals were -4.3% lower over the month but 15.3% higher year-on-year.  Melbourne (+1.4%), Hobart (+58.2%) and Canberra (+9.6%) were the only capital cities with a higher number of dwelling approvals over the month. 
Year-on-year the number of dwelling approvals were higher in Sydney (+45.8%), Melbourne (+21.3%) and Brisbane (+29.0%) but lower in Adelaide (-13.8%), Perth (-38.3%), Hobart (-4.4%), Darwin (-28.4%) and Canberra (-6.6%).
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<img src="/images/2016/10/04/Chart-4-580x209.jpg" alt="">
In August 2016 there were 7,264 capital city houses approved for construction which was the highest number of approvals since July 2015.  Capital city house approvals increased by 10.2% over the month and were 4.7% higher year-on-year.  The number of houses approved for construction in August was higher across all capital cities. 
Year-on-year house approvals were higher in Sydney (+4.3%), Melbourne (+18.0%), Brisbane (+15.1%), Hobart (+8.8%) and Canberra (+62.1%), were unchanged in Adelaide and were lower in Perth (-20.6%) and Darwin (-23.2%). 
Perth and Darwin are seeing falling sales, rents and home values and it seems the development industry is responding by seeking fewer new house approvals.
<a href="/images/2016/10/04/Chart-5-580x209.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/10/04/Chart-5-580x209.jpg" alt="">
There were 9,499 units approved for construction across the combined capital cities in August 2016.  Although unit approvals were -13.1% lower over the months, they were 25.0% higher year-on-year. 
Although unit approvals were lower over the month it was the 23rd consecutive month that house approvals were lower than unit approvals.  The number of capital city unit approvals were lower over the month across all cities except for Canberra which were 9.9% higher. 
Looking at the year-on-year changes in approvals, they were lower in Adelaide (-39.2%), Perth (-67.1), Canberra (-18.5%) and Hobart and Darwin where there were no approvals in August 2016.  Unit approvals were higher year-on-year in Sydney (+71.1%), Melbourne (+24.3%) and Brisbane (+43.0%).  Interestingly the number of units approved for construction is trending higher again in Sydney and Melbourne (although they fell a little in August) while in most other capital cities they are falling.
We’ve been expecting the number of dwelling approvals to start trending lower for some time and to-date it just hasn’t occurred.  We anticipate that approvals will slow over the coming year however, they are likely to remain high on an historic basis. 
With tighter lending policies, particularly for investors it is reasonable to expect that once the slowdown occurs, it is likely to impact on the unit market more so than the detached housing market which tends to be dominated by owner occupiers more than investors.
Cameron Kusher is research analyst for CoreLogic. You can contact him <a href="https://blog.corelogic.com.au/about/">here</a>.
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Dwelling approvals remain at very high levels: CoreLogic

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GUEST OBSERVER
Despite repeated warnings around apartment oversupply and settlement risk, the number of dwellings being approved for construction across the capital cities remains unquestionably strong.
In July 2016, there were 17,380 capital city dwelling approvals which was the highest number of approvals since October 2015.  It was also the third highest monthly number of capital city dwelling approvals on record.  Despite a recent slowdown in capital city dwelling approvals there was a substantial rebound in July 2016.
<div>
<h3>Monthly and 6 month average number of capital city house and unit approvals</h3>
<a href="/images/2016/10/04/2016-09-26--image1.png" target="_blank">Click to enlarge</a>
<img src="/images/2016/10/04/2016-09-26--image1.png" alt="">
<h3>6 month average number of capital city dwelling approvals</h3>
<a href="/images/2016/10/04/2016-09-26--image2.png" target="_blank">Click to enlarge</a>
<img src="/images/2016/10/04/2016-09-26--image2.png" alt="">
Looking at the split between houses and units over the month, there were 6,482 houses and 10,898 units approved for construction across the combined capital cities.  There have now been more units approved for construction than houses across the combined capital cities for 22 consecutive months.  Over the 12 months to July 2016, 57.9% of all capital city dwelling approvals were for units.
<h3>6 month average number of capital city house approvals</h3>
<a href="/images/2016/10/04/2016-09-26--image3.png" target="_blank">Click to enlarge</a>
<img src="/images/2016/10/04/2016-09-26--image3.png" alt="">
<h3>6 month average number of capital city unit approvals</h3>
<a href="/images/2016/10/04/2016-09-26--image4.png" target="_blank">Click to enlarge</a>
<img src="/images/2016/10/04/2016-09-26--image4.png" alt="">
Over the past year, there have been 76,356 capital city houses and 104,835 capital city units approved for construction.  In each of: Sydney, Melbourne, Brisbane and Canberra there have been more units than houses approved for construction over the past year.
Sydney - there were 54,667 dwelling approvals over the past year which is 7.3% higher than the previous year.  This figure comprised of 16,360 house approvals (+3.2% yoy) and 38,307 unit approvals (+9.1% yoy).
Melbourne – over the year to July 2016 there were 57,428 dwellings approvals which was -0.2% lower over the year.  25,880 of these approvals were for houses and 31,548 were units, with the year-on-year changes recorded at +11.2% and  -7.9% respectively.
Brisbane – The 30,901 dwelling approvals over the past year consisted of 11,210 houses and 19,691 units.  Overall approvals are 4.0% higher over the year with house approvals -1.4% lower and unit approvals 7.4% higher. 
Adelaide – there were 6,119 houses and 3,899 units approved over the past year resulting in 10,018 total approvals.  Over the past year, dwelling approvals are 10.9% higher with house approvals up 9.3% and unit approvals 13.5% higher.
Perth – the number of annual dwellings approvals fell by -24.3% over the year to 20,963.  Over the year, the 14,202 house approvals were -26.7% fewer than the previous year and the 6,761 unit approvals were -18.6% less than a year ago.
Hobart – there were only 989 new dwellings approved for construction over the year, 799 of which were houses and 190 units.  House approvals were -22.7% lower year-on-year and unit approvals were down -10.8%.
Darwin – there were 1,304 dwelling approvals over the past year which was -12.7% lower year-on-year.  Over the year, the 657 house approvals was -22.8% lower than the previous year and the 647 unit approvals were 0.6% higher than the previous year.
Canberra – there were 1,129 houses and 3,792 units approved for construction over the past 12 months.  There were -8.1% fewer house approvals than over the previous year while unit approvals were 24.7% higher over the year.
Despite policy makers and analysts (including CoreLogic) voicing concerns about the level of housing construction currently underway, particularly for units, approvals in capital cities generally remain unquestionably strong.  From here it will be interesting to see how many of these approvals immediately progress to commencement and ultimately through to a completion.  Tighter lending conditions for both developers and purchasers for off-the-plan units is likely to result in a larger proportion of approvals that don’t proceed through to a finished product.  The data also reiterates why purchasers of off-the-plan units in major capital city housing markets should be very selective with regard to the types of units they purchase.
Importantly, oversupply concerns are most visible across specific and well defined geographic areas and product types. CoreLogic’s Settlement Risk Report identifies the Melbourne inner city and Brisbane inner city as the two markets where the largest amount of unit supply is likely to be delivered over the next 24 months.
Cameron Kusher is research analyst for CoreLogic. You can contact him <a href="https://blog.corelogic.com.au/about/">here</a>.
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Capital city dwelling approvals rebounding: Cameron Kusher

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At the end of 2014, the Australian Prudential Regulation Authority (APRA) wrote to mortgage lenders reinforcing what they saw as sound mortgage lending practices. 
The key points from that letter were that serviceability policy limits should be based on mortgage rates at least 2 percent above the product loan rate with a minimum floor assessment of 7 percent. 
The second point was that APRA was going to impose a speed limit on investment credit growth to lenders of 10 percent per annum. It is important to note investment credit refers to total outstanding mortgages not new lending.
The impact of these policies was likely to be that as interest rates fell, more buyers weren’t encouraged into the market because mortgages were being granted based on the ability to repay a mortgage at 7 percent interest which was well above standard rates at that time.  The other impact was that the 10% cap on investor housing credit growth would slow demand from the investment segment as there was less new lending to go around.
While the serviceability limits mean that new first time buyers are unlikely to come into the market as interest rates fall, it does nothing to discourage current owners from buying investment properties or upgrading homes.  Given that the vast majority of home loans are on a variable rate, interest rate cuts have an almost immediate impact on household budgets. 
While the serviceability limits won’t result in marginal purchasers entering the market, as interest rates have come down it appears that home owners that weren’t previously considering buying an investment property or upgrading have come out of the woodwork and decided to purchase.
<a href="/images/2016/09/21/Chart-1-1-580x176.jpg" target="_blank">Click to enlarge</a>
 <img src="/images/2016/09/21/Chart-1-1-580x176.jpg" alt="">
It is somewhat difficult to gauge exactly how effective the serviceability changes have been, but the 10% cap on investor housing credit led to a significant decline in growth in lending to that market segment.  Shortly following the implementation of the investor lending cap we also saw lenders place an interest rate premium on investment mortgages.  This muddied the waters somewhat because a lot of mortgages which were previously designated as investment mortgages were reclassified as owner occupier mortgages. 
Nevertheless, annual investor housing credit growth peaked at 10.8 percent in May 2015 according to Reserve Bank data and the latest data shows that it has slowed to growth of 4.8% over the year to July 2016.  Investor housing credit growth has slowed dramatically since its recent peak following these curbs and over the past year has increased at its slowest annual pace since November 2009.
<a href="/images/2016/09/21/Chart-2-1-580x210.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/09/21/Chart-2-1-580x210.jpg" alt="">
Housing finance data which tracks new lending, has showed a bounce in new lending to investors over the three months to July 2016.  Over that period, the monthly value of investment lending has increased by 9.2 percent from $10.8 billion in April 2016 to $11.8 billion in July 2016, new lending to investors is at its highest level since August 2015.  With investor housing credit growth well below 10 percent per annum, it is clear that lenders have scope to now offer more lending to the investment segment and clearly there are investors grabbing that opportunity.  
But why is this the case when you have a record supply of new housing under construction, record low rental yields and a historically weak rental market? We are about to delve into some possible reasons why, for some investors, housing investment still makes sense however, investors looking to purchase residential properties should be aware of the potential risks on the horizon.
Capital growth
<a href="/images/2016/09/21/Chart-3-1-580x211.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/09/21/Chart-3-1-580x211.jpg" alt="">
Since the current growth phase commenced in June 2012, combined capital city home values have increased by 39.9%.  As the above chart shows, the growth has been very uneven with Sydney and Melbourne leading the way in terms of value growth and rises relatively moderate elsewhere.  After such a long growth phase, the question must be asked as to how much longer the growth can continue for in Sydney and Melbourne, particularly considering the affordably obstacles that are becoming more pronounced and the diminishing yield profile caused by the fact that dwelling values are rising at a much faster pace than rents.
Housing supply
<a href="/images/2016/09/21/Chart-4-1-580x197.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/09/21/Chart-4-1-580x197.jpg" alt="">
The supply of new housing under construction is at a record-high with an historic high level of units under construction.  The 2011 national Census showed that units were much more likely to be occupied by renters than houses.  At that time, and across homes occupied on Census night, 21.8 percent of houses and 57.8% of units were occupied by renters. 
Of course housing choices are likely to have shifted somewhat since that time but the fact is likely to remain that units are much more likely to end up as rental accommodation than houses are.  As a result a large proportion of these units recently built and under construction will end up as rental accommodation.  In many cities we are also already seeing a significant difference in the rate of growth for houses as opposed to units.
<a href="/images/2016/09/21/Chart-5-1-580x212.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/09/21/Chart-5-1-580x212.jpg" alt="">
Rental markets are showing the weakest growth conditions on record, in fact, capital city rental rates are -0.5 percent lower over the past year.  In the two cities where the highest level of investment activity is occurring, Sydney and Melbourne, rents are unchanged in Sydney and 2.4 percent higher in Melbourne.  For units specifically, rental rates are 0.7 percent higher over the year across the combined capital cities with rental rates 1.8 percent higher for Sydney units and 1.3 percent higher for Melbourne units.
There is a large supply of housing stock that is going to be added to the market over the coming year(s) in these cities and others.  Most of the supply is in the form of units, which as shown are more likely to be rental properties.  Subsequently it seems as if landlords are set to find it more difficult to keep renters and may have to reduce rents in order to keep their properties tenanted over the coming years.  Higher vacancy rates may be felt by those landlords who own units that are in need of repair or refurbishment as tenants look for higher quality or new rental accommodation that may be more comfortable at a similar rental rate.
Rental returns
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<img src="/images/2016/09/21/Chart-6-580x209.jpg" alt="">
Rental yields are expressed as gross figures so the net returns are likely to be much lower than the headline figure.  The gross rental yield has been forced lower over recent years due to little rental growth (and falls in some areas) coupled with comparatively high levels of home value growth. As a result, at the end of August 2016 the combined capital cities gross rental yield was recorded at an historic low 3.3 percent with figures of 3.0 percent in Sydney and 2.9 percent in Melbourne.  
A couple of things to note about the yield figures; firstly they assume that a property is occupied for 100 percent of the year and secondly they are based off current values, most investors would not borrow 100 percent of the loan value for an investment property.  Given these two points, lower than 100 percent occupancy would reduce the yield however, borrowing less than 100% of the property’s value would increase the yield.
As pointed out earlier, units are much more likely than houses to be used for rental accommodation and there is a record pipeline of unit stock under construction.  Gross rental yields for units specifically are higher than those for houses and recorded at 4.1 percent for combined capital city units, 3.9 percent in Sydney and 4.0% in Melbourne.  Each of these figures are at historic lows and have trended lower over recent years.  Nevertheless, when you factor in a level of equity used to purchase investment properties the returns are still far superior to most other asset classes.
Total returns
Click to enlarge
<img src="/images/2016/09/21/Chart-7-580x208.jpg" alt="">
When you factor in rental returns and capital growth, the total returns from residential property remain attractive.  Over the past year, total gross returns across the combined capital cities have been recorded at 10.7% with each capital city other than Perth and Darwin recording total returns in excess of 7.0% over the past year. Since home values ended their most recent declines in May 2012, combined capital city total returns have been recorded at 62.7% and no capital city has recorded returns of less than 25% over the period
Other asset classes
A major reason why investors remain attracted to residential property is due to the fact that with low interest rates and low economic growth internationally, returns have reduced.  Based on the most recent end of month data, 10 year Australian Government bonds were yielding 1.88 percent, 1 year term deposit rates were 2.65 percent and total returns from the ASX 200 were 9.3 percent.  The safe investment classes of bonds and term deposits are providing extremely low returns.  At the same time total returns from equities have been much stronger however, equities are a more volatile asset class than housing.
While the housing market has provided relatively strong investment returns over recent years and may continue to provide comparatively strong returns over the coming years, there are certainly some headwinds that investors need to be aware of.  Keep in mind too that the purchase cost of a residential property is significantly greater than investing in other asset classes.  The additions to housing supply underway and the weakening rental market should provide a level of caution for investors. 
Given the cost of housing and the looming challenges we would expect that although there is likely to be some further uplift in investment demand it is unlikely to result in growth in investor credit to head back towards the 10%pa speed limit.  Investors will also need to be much more selective around which properties they choose given achieving strong returns are seemingly going to be more difficult to achieve over the coming years given the looming headwinds described within.
Cameron Kusher is research analyst for CoreLogic. You can contact him <a href="https://blog.corelogic.com.au/about/">here</a>.
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Investors re-entering the housing market but should do so with caution: Cameron Kusher

The new <a href="https://www.apartments.com.au/new-apartments/yarraville-green-42-stephen-street-yarraville-vic-3013">Yarraville Green</a> development in Melbourne's inner west is showing that landscaping can be just as influential as architecture, with buyers responding strongly to the garden-first approach adopted from the outset by developer Excelon Projects and the project's design team.

Excelon appointed Six Degrees Architects and landscape architects SBLA to work collaboratively on the development, with a brief to create "a sustainable, design-led building with a focus on community."

That approach has resonated with buyers. According to Next Chapter Director Tom Hirini, who is leading the sales campaign, the landscaped communal garden has become one of the project's defining features, alongside its boutique scale and European-inspired cluster housing concept.

Local downsizers, right-sizers and established families already living in Yarraville and surrounding suburbs have accounted for the majority of purchasers.

[smartcode_project:default project_id=144913 project_image_fid=297740]

Yarraville Green will comprise 53 homes, including apartments and townhomes, arranged around the shared central garden to maximise connections to the landscaped open space. Parking has been moved underground, allowing the ground plane to be dedicated to greenery, pedestrian movement and communal spaces.

The landscape extends well beyond passive planting. Productive garden beds, a pergola, communal gathering spaces, garden sheds and a pet wash have all been integrated into the masterplan, creating spaces designed to encourage everyday interaction between residents.

[smartcode_project:default project_id=144913 project_image_fid=297741]

The interiors continue Excelon's focus on craftsmanship, incorporating bespoke elements by Melbourne artisans including leadlight detailing by Adadaz, hand-turned timber hardware by Auburn Woodturning and blown-glass lighting by Ruth Allen.

Sustainability has also been embedded throughout the project, with Yarraville Green targeting an average 7-star NatHERS energy rating through passive design principles, rooftop solar servicing common areas and rainwater harvesting for landscape irrigation.

[smartcode_project:default project_id=144913 project_image_fid=297735]

Construction continues to progress at Yarraville Green, with structural works well underway and framing works approaching completion under builder Balmain &amp; Co. The project remains on track for completion in mid-2027.

Apartments at Yarraville Green are currently priced from $625,000, while townhomes start from $1.4 million.

[smartcode_project_cta:default project_id=144913]

Joel Robinson

Garden-led design drives buyer demand at Yarraville Green

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.

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.

[smartcode_project:default project_id=145922 project_image_fid=373556]

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.

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.

"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.

"Every Fortis project is shaped by its context, and we approach each one with the respect and care it deserves.

"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."

[smartcode_project:default project_id=145922 project_image_fid=373559]

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.

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.

[smartcode_project:default project_id=145922 project_image_fid=373583]

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.

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.

[smartcode_project:default project_id=145922 project_image_fid=373571]

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.

Completion of Crest &amp; Walker is slated for late 2028.

[smartcode_project_cta:default project_id=145922]

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

The enormity of delivering a true skyscraper in Australia's new development market is often overlooked.

It has taken the best part of a decade since plans for Chevron One were first unveiled, but the 41-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.

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.

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.

[smartcode_project:default project_id=6515 project_image_fid=68833]

Developer Bensons Property Group is behind the 41-storey tower, which has 229 apartments, along with an exhaustive list of resident amenity spread across what is the largest development site ever assembled on Chevron Island.

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.

"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.

"It's only when they walk through a completed apartment that they truly understand the position of the building," Rosenboom says.

"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."

[smartcode_project:default project_id=6515 project_image_fid=360215]

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.

"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.

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.

"The size of the site is something that would be incredibly difficult to replicate today," she says.

"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."

[smartcode_project:default project_id=6515 project_image_fid=68839]

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.

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.

"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.

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.

The remaining apartments are ready to inspect in person, by appointment.

[smartcode_project_cta:default project_id=6515]

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

A general rule of thumb in new apartment developments is that the penthouses get the rooftop.

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.

<a href="https://www.apartments.com.au/developers/sherpa-property-group">Sherpa Property Group</a> has taken the opposite approach.

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.

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.

[smartcode_project:default project_id=150017 project_image_fid=374053]

"We're seeing a clear move toward developments that offer more than just an apartment," Sherpa Group founder Christie Leet said.

"People want spaces that support how they actually live, whether that's working from home, staying active, or spending time with family and friends.

"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."

[smartcode_project:default project_id=150017 project_image_fid=374052]

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.

Instead of a single rooftop, Soleira delivers two distinct lifestyle zones.

[smartcode_project:default project_id=150017 project_image_fid=372547]

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.

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.

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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.

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.

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While Soleira is the largest project Sherpa has delivered, the rooftop-first philosophy has been evolving for several years.

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.

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.

[smartcode_project:default project_id=146527 project_image_fid=366550]

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.

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.

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Sherpa takes amenity to the sky as Flourish Soleira captures booming Palm Beach demand

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.

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.

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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.

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.

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.

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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.

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.

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.

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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.

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.

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.

[smartcode_project_cta:default project_id=426]

Cameron Kusher

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