<html><body>
For the first three months of 2014 there were 82,051 house sales and 30,417 unit sales recorded. Sales over the first quarter of this year were much softer than over the last quarter of 2013.
 Regardless, March 2014 managed to record the strongest first quarter for house sales since 2009, and the strongest for units since 2010. House sales were 7.9% higher and unit sales are 4.0% higher than for the same quarter in 2013.
 <img src="/images/2014/06/06/kusher-june-6-one.gif" alt="">
Sales volumes are generally lower over the first quarter of any year compared to the remaining quarters which is largely due to a slowing in housing market activity throughout most of January and often well into February.
Given this, it’s not necessarily best to compare sales between quarters because the housing market acts very differently in each period however, comparing to the same quarter in previous years does provide insight into the comparative performance of the market.
Across individual capital city markets, the annual change in sales is quite varied and dependent upon where each city is within the property cycle.
 <img src="/images/2014/06/06/kusher-june-6-two.gif" alt="">
In the more subdued capital city markets of Brisbane and Adelaide where value growth has been limited, these two cities managed to record the greatest annual rise in sales; up 21.1% and 10.8% respectively. Perth and Canberra on the other hand, have recorded falls in sales over the year, down -8.2% and -4.2% respectively.
By way of the variation between houses and units the pick-up in sales activity year-on-year has been greater for houses (7.9%) than it has been for units (1.2%). Over the first three months of this year, house sales were higher than in the same period last year across each city except for Perth (-5.9%) and Darwin (-6.0%). Focussing on unit sales, sales are lower over the first quarter in Sydney (-1.7%), Perth (-17.6%) and Canberra (-23.9%).
 <img src="/images/2014/06/06/kusher-june-6-thre.gif" alt="">
Historically there has always been a strong correlation between sales volumes and property values. If demand is greater and more homes are selling, the likelihood is that values will rise. Alternatively, if fewer buyers are active in the market selling conditions become tougher and values fall,” he said.
When the number of homes sales across Australia’s capital cities edge below 80,000 on a quarterly basis, values are typically rising by a quarterly rate of less than 2.0%. However, when quarterly sales fall to 70,000, this has generally been a trigger point for values to start falling.
While our March sales volumes data indicates that although sales are higher than they were a year ago, monthly sales activity isn’t as strong as it was at the end of 2013.
With the quarterly rate of home value growth having most recently peaked in September 2013 and quarterly sales having peaked shortly thereafter in November, it will be interesting to watch what happens to sales and values from here.
 <img src="/images/2014/06/06/kusher-june-6-four.gif" alt="">
The May RP Data-Rismark Home Value Index results released earlier this week confirmed that capital city home values fell by -1.9% in May 2014. Although this is likely the result of a seasonal influence on the reading, I question that with quarterly value growth peaking and sales volumes tapering, will volumes continue to ease and value growth continue to moderate? Alternatively, will the second half of the year see a rebound in both sales and values much like occurred over the second half of 2013?
While as yet we don’t know the answer to this question, we do know is that last year values rose by 3.0% over the first six months of 2013 followed by a 6.6% capital gain over the second half. With interest rates set to remain low, it may provide enough stimuli to see values start climbing more rapidly once more. We believe that the strong growth in late 2013 and early 2014 has peaked and although values are likely to keep rising, they will most likely do so at a more moderate pace.
This is largely due to affordability constraints becoming more prevalent in the market and both lower returns and capital growth potential for the investors that have been so active in the market. Adding to this is consumer sentiment, which has been trending lower since September last year.
</body></html>

ckusher-ujnxiKuFQs

March quarter strongest for house sales in five years

<html><body>
Growing demand for housing close to inner city areas was the topic of a recent speech by The Reserve Bank’s (RBA) head of financial stability, Luci Ellis.
Entitled ‘Space and Stability: Some Reflections on the Housing-Finance System’, Ellis made some valid points relevant to the housing market in her speech.
Ellis’ speech goes some way to explaining why detached housing closer to the centre of a city is much more expensive than for those suburbs located further away. Put simply, Ellis noted in her speech that housing in these areas is in short supply and with high demand due to its convenience to major working nodes. 
Several key points made on housing within the speech were:
<ul>
<li>Housing prices in the inner-ring are becoming more expensive than those in outer areas of our capital cities;</li>
<li>The availability of jobs is becoming even more centralised, particularly within already established working nodes;</li>
<li>There are minimal jobs outside of city areas; it is becoming increasingly difficult to grow smaller cities and few centres outside of the capital cities have job magnets. Given this, when residents are priced out of capital cities and more affordable regional housing options are not a viable alternative.</li>
</ul>
A rise in the popularity of inner-city unit living is driven by a desire to live closer to the city centre at a lower cost than detached housing. Australia has comparatively low density cities with significant price premiums in the most convenient areas of the city.
Ellis’ speech noted that if housing costs rise beyond people's comfort levels, it is not always feasible or attractive for households to respond by moving to cheaper areas, especially if the more affordable options are further away from their place of employment.
The RBA is hopeful that over time the structure of our cities is such that home owners will have more options as to where they can live, rather than having to live in expensive housing closer to working nodes such as current policies often necessitate.
With plenty of commentary around on some of the best performing areas around the country, it’s important to note that this analysis is typically undertaken over a relatively short-time frame of around 10 years, and where it is often reported that new greenfield areas and regional housing markets are better for capital growth than inner city areas.
The nature of new greenfield developments, both within a capital city and in regional areas, can lift prices in these areas from a very low starting point to a much higher new base as the area sees an influx of new modern housing. While over a shorter time frame this may result in heightened levels of median price increases, this is typically a relatively short-term phenomenon.
It also compares to the shift from a much lower quality initial housing product to a far superior newer housing supply.
Below is a list of suburbs that have recorded the largest rise in median selling prices over a 10 year and a 20 year timeframe. Interestingly, Miles and Chinchilla in regional Queensland are the only regional suburbs listed. Elsewhere, the list is dominated by a collection of the most desirable inner city suburbs in Sydney, Melbourne and Brisbane - all with high median prices, and all relatively close to major working nodes .
<img src="/images/2014/05/29/kusher-may-29-chart-one.gif" alt="">
With the population continuing to grow and housing supply insufficient we would expect that inner-city houses will continue to be the best performed over the long-term with significant demand and a short supply available.
Note: Median prices are not the most appropriate measure of a market change because these don’t continually measure the change across the same collection of properties. Median prices look at those properties that transaction over specific periods (which may be dramatically different each year).
The table above shows a strong bias towards regional areas of the country over a shorter time frame, particularly those linked to the resource sector. The rate of compound growth over the 10 years is much higher than those in the second table which looks at the 20 year period and reflects the boom in the mining sector over recent years.
The table below supports comments from the RBA with the list dominated by inner city suburbs.
<img src="/images/2014/05/29/kusher-may-29-chart-two.gif" alt="">
</body></html>

Reserve Bank’s take on current housing market

<html><body>
Earlier this week the Australian Bureau of Statistics (ABS) released data which revealed that 46.4% of state and local government taxation revenue over the 2012-13 financial year came from property related taxes.
The data showed that over the year, state and local governments collected a record $35.931 billion in taxes from property related sources.  
In comparison, they collected $20.752 million in taxes from employers, $11,089 million in taxes from the provision of goods and services and $9.638 million in taxes on the use of goods and performance of activities.  As this shows, at a state and local government level property taxes are the largest source of revenue.
<img class="aligncenter size-full wp-image-3293" src="https://blog.rpdata.com/wp-content/uploads/2014/05/Chart-13.jpg" alt="Chart 1">
Source: RP Data, ABS.
The total value of property related taxes increased by 7.2% over the most recent financial year.  In comparison, taxes on employer’s payroll and labour force rose by 5.1%, taxes on the provision of goods and services rose 2.4% and taxes on the use of goods and performance of activities rose 8.6%.
With home values nationally beginning to rise in June 2012, it is clear that state and local government are a major benefactor. With higher home values, taxes such as land tax, municipal rates and stamp duty on conveyances all increase.
<img class="aligncenter size-full wp-image-3294" src="https://blog.rpdata.com/wp-content/uploads/2014/05/Chart-23.jpg" alt="Chart 2" width="500" height="501">
Source: RP Data, ABS.
Of the $35.931 billion in property related tax revenue collected in 2012-13, 40% came from municipal rates and 36% came from stamp duties on conveyances.  Land tax was the only other sizeable contributor to property related tax accounting for 17% of revenue.  Over the year the most significant increase in property related taxes came from stamp duty, up by 16.9%.  The amount of tax revenue collected from municipal rates increased by 6.8%, and land taxes increased by 1.5%.
Article continues on next page. Please click below.
<hr class="system-pagebreak">
Property related tax revenue is only collected by those who own properties. Ultimately every property is owned by someone, some as an owner occupier and some as an investor. 
The taxes levied against property are typically only payable by the owner of the property.  Given this, those who choose to rent rather than own property pay no tax on property.  Not to mention the fact that the cost of renting is typically much lower than the cost of owning, it is no surprise more people are choosing to rent rather than own property.
State and local governments have clearly experienced a significant revenue boost via the improvement in the residential housing market over the year.  Stamp duty in particular has seen a significant rise.  With sales volumes and property values rising there have been more sales to receive stamp duty from and at a higher price which also increases the stamp duty collected. 
Of course, the issue with stamp duty is that it is a tax only collected across those properties which sell.  From a residential perspective this is just 5% to 7% of the total housing stock over a given year.  Stamp duty also acts as a disincentive for home owners to transact property on a more regular basis because it is a tax paid on a new purchase.
Many people have called for the removal of stamp duties which would be a positive move to encourage greater mobility of residents.  Of course state and local governments would lose 36% of their property related tax revenue and 17% of their total taxation revenue. 
Many have called for replacing stamp duty with a blanket land tax, another tax would likely be very unpopular and you’d have to consider how equitable that would be particularly for those who have recently paid stamp duty. 
To put a blanket land tax into perspective to cover the $12.841 billion in stamp duty revenue over the 2012-13 financial year, each residential dwelling would have to pay $1,391.69 based on the ABS estimate of 9,226,900 residential dwellings as at June 2013.  Keep in mind that stamp duty isn’t just payable on residential property transactions.
<img class="aligncenter size-full wp-image-3295" src="https://blog.rpdata.com/wp-content/uploads/2014/05/Chart-33.jpg" alt="Chart 3" width="500" height="163">
Source: RP Data, ABS.
Over the year, stamp duty revenue was higher in each state except for Victoria (-1.4%), Queensland (-6.7%) and the Australian Capital Territory (-3.3%).  New South Wales (21.4%), Western Australia (33.0%) and the Northern Territory (35.5%) recorded the greatest rises in stamp duty revenue. 
According to the RP Data-Rismark Home Value Index, Sydney home values rose by 5.6% over the year, Perth values were 6.0% higher and Darwin values were 6.1% higher.  Conversely, Melbourne home values were 3.4% higher, Brisbane values were just 0.6% higher and Canberra value were 1.1% higher.  Clearly home value rises have a positive effect on stamp duty revenues.
The data highlighted shows that property is the most important source of revenue for state and local governments, accounting for 46.4% of their total taxation revenue.  The issue of course is that these levels of government are looking to constantly grow their revenues. 
The two main sources of property related revenue are rates and stamp duty.  Rates can be grown by encouraging a greater number of ratepayers into a region (create more housing) and stamp duty can only be lifted by changing the rates or encouraging higher prices and/or more sales. 
In certain regions increasing the supply of ratepayers is not possible so it is clear that stamp duty is an extremely important source of revenue. With the housing market recording significant value growth and much higher sales volumes throughout the 2013-14 financial year, no doubt stamp duty revenue will be much higher again. 
The question is can governments continue to rely on property being a one-way bet?  Particularly when the Reserve Bank has repeatedly warned of late that it is not.
</body></html>

Can governments continue to rely on property being a one-way bet?

<html><body>
While a rise in home values across Australia’s property market has been welcome news for Sydney and Melbourne property owners in particular, the flow on effect hasn’t been so favourable for rental growth and yields.
Rental growth has slowed markedly and rental yields are falling as value growth significantly outpaces rental growth.
<img src="/images/2014/05/22/kusher-may-22-one.gif" alt="">
The May RP Data-Rismark Home Value Index reported that combined capital city home values increased by 11.5%. At an individual capital city level, value growth ranged from 1.2% in Canberra to a 16.7% rise in Sydney. Australia’s combined capital cities recorded an increase in rental rates of 2.4% over the past year.
Sydney, Melbourne and Hobart are the only capital cities where rental growth was greater over the past 12 months than for the previous 12 months. At the other end of the spectrum, growth slowed across five of the eight capital cities with Perth experiencing the most extreme slowdown.
<img src="/images/2014/05/22/kusher-may-22-two.gif" alt="">
Over the 12 months to April 2013, Perth rental rates had increased by 10.4% compared to a -0.5% fall over the most recent 12 months. Sydney was the only city to record an increase in rental rates higher than inflation; up 3.7% over the past year.
With a large percentage of loans now going to investors at a time when the rate of rental growth is slowing would suggest that most investors are chasing capital growth rather than rental return. When you consider that the value growth in our two largest cities (Sydney and Melbourne) has been so strong over the past year, it’s no surprise.
<img src="/images/2014/05/22/kusher-may-22-three.gif" alt="">
Comparing annual value growth and annual rental growth across each capital city, home values rose at a faster pace than rental rates and as a result, rental yields experienced a fall over the year.
It wasn’t surprising to see that the greatest differences between home value growth and rental growth have been recorded in Sydney and Melbourne.
<img src="/images/2014/05/22/kusher-may-22-four.gif" alt="">
As a result of values rising faster than rental rates, gross rental yields have fallen over the past year across each capital city. The largest falls in yields have been experienced across Sydney and Melbourne where value growth has been strongest. These two cities also have the lowest yields of all capital cities at 3.9% and 3.4% respectively.
This highlight that as home values rise, the level of rental growth has not been able to keep pace.
</body></html>

Flow on effect of rising home value is slowing rental growth and falling yields

<html><body>
Over the three months to April 1990, the median selling price of a dwelling (a combination of houses and units) across Sydney was recorded at $152,500. 
As at April 2014, the median selling price of a dwelling was $680,000 which represents a 347% increase in selling price over the 24 year period.  Of course a median price is only measured across properties which actually transacted but it is interesting to look at what the median priced home is over time
The following charts will look at the changes in median price over time and the location of median priced sales.  Note that the each dot represents one sale and the red dots indicate house sales while the blue dots represent unit sales.  The buffers shown on the maps represent a 10 kilometre, 20 kilometre and 50 kilometre distance from the Sydney CBD.
Three months to April 1990
<img class="aligncenter size-large wp-image-3252" src="https://blog.rpdata.com/wp-content/uploads/2014/05/Sydney-1990-580x533.jpg" alt="Sydney 1990" width="580" height="533">
The median price of a Sydney home over the three months to April 1990 was $237,000, across the city there was 12 sales at that price over the period, three of which were units and the remaining nine were houses. 
Apart from one sale at <a href="/news">Sylvania</a>, the reaming 11 sales all occurred within a 20 kilometre radius of the city.  For houses, you will note that four of the nine suburbs are located within a 10 kilometre radius of the city and for units, <a href="/news">Epping</a> was the only suburb with a sale outside of the 10 kilometre region.
Three months to April 1994
<img class="aligncenter size-large wp-image-3253" src="https://blog.rpdata.com/wp-content/uploads/2014/05/Sydney-1994-580x537.jpg" alt="Sydney 1994" width="580" height="537">
Moving to April 1994, there were 34 sales at the median price over the three month period and the median price was recorded at $169,000. 
Comparing this chart to the previous chart you see that the median priced house is beginning to move further away from the city centre with only five of the 24 median priced house sales within 10 kilometres of the city centre and five of those 24 sales were located more than 20 kilometres from the city centre.  For units, three of the 10 sales were outside of a 10 kilometre radius of the city, two of which were more than 20 kilometres away.
Three months to April 1999
<img class="aligncenter size-large wp-image-3254" src="https://blog.rpdata.com/wp-content/uploads/2014/05/Sydney-1999-580x540.jpg" alt="Sydney 1999" width="580" height="540">
By April 1999, the Sydney median house price was recorded at $237,000 and over that three month period there was 28 houses sold at that price and 31 units. 
The big shift over the five year period was the fact that none of the median priced house sales were within a 10 kilometre radius and a greater proportion were located more than 20 kilometres from the city than those within 20 kilometres. 
Within a 10 kilometre radius of the city, units where the only sales at the median price however, units transacting at the median price were becoming more common in areas more than 10 kilometres from the city centre.
Article continues on next page. Please click below.
<hr class="system-pagebreak">
Three months to April 2004
<img class="aligncenter size-large wp-image-3255" src="https://blog.rpdata.com/wp-content/uploads/2014/05/Sydney-2004-580x543.jpg" alt="Sydney 2004" width="580" height="543">
The median Sydney dwelling price over the three months to April 2004 in Sydney was recorded at $440,000.
Over the preceding three months there were 62 house sales and 65 unit sales at that price.
Compared to five years earlier there were a few house sales within 10 kilometres of the city centre however, once again the majority occurred more than 20 kilometres from the city centre.  For units, most sales still occurred close to the city centre however, more and more were transacting at the median price further away from the city centre.
Three months to April 2009
<img class="aligncenter size-large wp-image-3256" src="https://blog.rpdata.com/wp-content/uploads/2014/05/Sydney-2009-580x544.jpg" alt="Sydney 2009" width="580" height="544">
By April 2009, the median dwelling price in Sydney was slightly lower than from five years earlier, recorded at $420,000. Keep in mind that from early 2004 to mid-2009 there was no growth in Sydney home values after they fell by around 10%.  
The map is quite similar to the previous one with 102 houses and 103 units sold at the median price. 
Once again only a few house sales were within a 10 kilometre radius of the city with the vast majority occurring more than 20 kilometres from the CBD.  Unit sales were fairly similar and mostly focused within the 20 kilometre radius of the city.
Three months to April 2014
<img class="aligncenter size-large wp-image-3257" src="https://blog.rpdata.com/wp-content/uploads/2014/05/Sydney-2014-580x550.jpg" alt="Sydney 2014" width="580" height="550">
Over the most recent three month period, the median Sydney dwelling price was recorded at $680,000.  Over the three month period (and note these figures will be revised higher) there was 31 house sales at the median price and 40 unit sales. 
Looking at the above map again we see few house sales within a 20 kilometre radius of the city and the median priced unit is pushing further away from the city centre with more and more sales occurring more than 10 kilometres from the CBD.
The analysis is an interesting exercise in how over time, the ‘typical’ home across the city is moving further and further away from the city centre. 
As a result, it is no wonder we are seeing growing levels of higher density development in the major capital cities.  As the typical housing option moves further away from the city centre, those that need or want to be close to the city centre look for more affordable alternatives such as units. 
As the city continues to grow and density in the inner city increases we would expect a further drift outwards of both the typical house and unit sale in Sydney.
</body></html>

Sydney housing over time: A case study

<html><body>
The differential between house and unit values is widening across Australia’s capital cities where houses are now recording greater value growth than units.
 Of the top five areas surveyed in each capital city, Peppermint Grove on the banks of the Swan River in Perth holds the greatest differential between capital city unit and house values; house values are 687% (or almost seven times) more expensive than unit values in the suburb.
Centennial Park in Sydney’s eastern suburbs followed and recorded a 523% differential then came the upmarket suburb of Toorak in Melbourne’s inner city at 283%.
Adelaide was a surprise addition with Toorak Gardens recording a differential of 280%, while Ascot in Brisbane recorded 236%. Forrest in Canberra recorded 242%. Lagging behind was Darwin and Hobart with their respective widest differentials of 156% and 105%.
<img src="/images/2014/05/15/kusher-may-15-two.jpg" alt="">
The data shows that at the end of the first quarter of 2014, combined capital city house values were 28% higher than those for combined capital city unit values while for the past 12 months, house values increased by 10.7% compared to a 9.4% rise in unit values. The faster rate of value growth for houses is likely to result in a growing differential between house and unit values.
Across the individual capital cities, house values are higher than unit values in each city with the differentials recorded at: Sydney (40%), Melbourne (40%), Brisbane (27%), Adelaide (31%), Perth (23%), Hobart (12%), Darwin (34%) and Canberra (46%). In most capitals we are seeing this differential widening.
I’m not surprised at the results given the widening gap between houses and units. It’s no real surprise we are seeing a rapid shift to greater development of units as opposed to houses.
More units have been approved for construction than houses in Sydney, Melbourne, Brisbane, Darwin and Canberra. However, it’s important to remember that more houses sell each year than the more affordable alternative which is units. As values rise, the challenge for some buyers is that they become priced out of the detached house market and will then need to divert the attention to more affordable alternatives found in the unit market. Today’s adjacent table listing the Top 5 suburbs highlights this fact well.
While many people aspire to living in desirable inner city areas, the reality is that there is a short supply of detached houses in these areas coupled with plenty of demand. As a result many will never be able to meet these aspirations. The alternative is to look to the unit market where the cost is still going to be comparatively high but is generally significantly lower than that of a detached house.
Units in these suburbs are often older style units which don’t come with modern architecture. Most of these suburbs are long established suburbs and have a fairly limited supply of units, most of which were built many years ago.
</body></html>

House price growth increasingly higher than unit values

<html><body>
The Australian Bureau of Statistics (ABS) released housing finance data for March 2014 earlier this week.
The data showed that the number of owner occupier housing finance commitments fell by -0.9% in March.  In value terms, lending to owner occupiers was -1.2% lower over the month and lending to investors was down -0.8%.
<img class="aligncenter size-full wp-image-3222" src="https://blog.rpdata.com/wp-content/uploads/2014/05/Chart-11.jpg" alt="Chart 1" width="500" height="182">
Looking at the break-down of housing finance commitments by value over-time, you can see that on a 12 month average basis, the greatest proportion of lending over the past year has gone to investors (37.7%) followed by: owner occupier subsequent purchasers (non-first home buyers) (36.7%), refinances by owner occupiers (17.6%) and owner occupier first home buyers (7.9%). 
As the above chart shows, investment lending is at its highest level in a number of years and there has previously only ever been one period where investment lending was greater than lending to subsequent purchasers. 
The proportion of lending to first home buyers is at a record low, accounting for an average of 7.9% of the value of finance commitments over the 12 months to March 2014.
<img class="aligncenter size-full wp-image-3223" src="https://blog.rpdata.com/wp-content/uploads/2014/05/Chart-21.jpg" alt="Chart 2" width="500" height="179">
Turning the focus to the monthly data on the number of owner occupier housing finance commitments, as mentioned these were -0.9% lower with refinance commitments down -1.0% and non-refinance commitments falling -0.9%. 
Despite the monthly fall, as the above chart shows, both refinances and non-refinances are trending higher albeit non-refinances in particular remain well below historic average levels.
<img class="aligncenter size-full wp-image-3224" src="https://blog.rpdata.com/wp-content/uploads/2014/05/Chart-31.jpg" alt="Chart 3" width="500" height="182">
Over the month, owner occupier housing finance commitments to first home buyers increased by 12.2% which was the largest monthly rise since May 2012.  Despite the monthly rise, first home buyer commitments remain slightly lower than a year ago (-0.8%). 
As a proportion of total owner occupier finance commitments, first home buyers accounted for 12.6% of commitments in March, up from 12.5% in February but down from 14.1% in March 2013.
<img class="aligncenter size-full wp-image-3225" src="https://blog.rpdata.com/wp-content/uploads/2014/05/Chart-41.jpg" alt="Chart 4" width="500" height="181">
The total value of investment housing finance commitments fell by -0.8% in March 2014 however, it has increased by 27.9% year-on-year.  As mentioned, the proportion of investment commitments has, on average, been higher than owner occupier subsequent purchases over the past year. 
In March, investment finance commitments accounted for 39.1% of total finance commitments.  The level of investment activity remains at a level which is well above average and of a magnitude not recorded since late in 2003.  Although it is hard to bed down any timely and accurate statistics on overseas buyers it is important to note that if foreign buyers are purchasing with funds sourced from abroad, they are not captured in these figures.
<blockquote>
The last time we saw investment activity at these levels we also witnessed a marked slowdown in value growth nationally.
</blockquote>
With the level of investment remaining stubbornly high, it is no wonder that the Reserve Bank continues to repeat its warning that housing in Australia is not a one-way bet.  Obviously low mortgage rates coupled with strong value growth, particularly in Sydney and Melbourne is attracting the attention of investors. 
The potential challenge will be what happens next with investors once value growth slows and mortgage rates rise. 
The last time we saw investment activity at these levels we also witnessed a marked slowdown in value growth nationally. As an example, in Sydney values began falling shortly thereafter and values took five and a half years to return to their previous peaks.  Investors jumping into the market at this time should definitely bear this in mind.
Overall, the monthly read on housing finance data was weak, however, the trend shows that demand for finance is continuing to escalate. In particular, investors and upgraders are really driving the housing market at the moment.
However, the level of activity by owner occupiers purchasing homes (as opposed to refinancing) remains well below average levels.  Obviously the rise in investment lending is to some extent restricting the level of lending to owner occupiers.
</body></html>

Level of investment remains stubbornly high in housing finance data

<html><body>
Negative gearing, which allows expenses associated with investments to be off-set against income earnings, is repeatedly referenced in the 2011-2012 Taxation Statistics Report released recently by the Australian Taxation Office (ATO). Some of the most common deductions for residential property are: rental interest, capital works and other costs such as strata levies and depreciation.
The ATO stated that over the 2011/12 financial year there were 9,799,820 million taxable individuals in Australia. Of these individuals, 19.3% or almost one in five owned investment properties.
<img src="/images/2014/05/08/kusher-may-8-one.jpg" alt="">
The proportion of Australian’s that now own an investment property is currently trending higher although there was a slight fall over the most recent year; in 1993/94, 12.9% of taxpayers owned an investment property compared to 19.3%.
It was interesting to see the increase in the proportion of investment property owners that are negatively geared.
<img src="/images/2014/05/08/kusher-may-8-two.jpg" alt="">
The proportion of investors reporting a net loss on investment property increased from just over half (51.0%) in 1993/94 to 66.8% in 2011/12.
Once again, the proportion of negatively geared investors has eased slightly over the most recent year however, less than one third of all owners of residential investment property are actually producing a net profit from that investment.
The 2011/12 taxation statistics show that gross rent from investment properties was recorded at a record high $33.999 billion. The analysis on the deductions claimed from this amount: $24.177 billion, was for rental interest deductions. $2.167 billion was claimed in rent capital works deductions and $15.351 billion was claimed in ‘other deductions’. As a result, the net rental losses on investment property over the 2011/12 financial year were recorded at $7.859 billion.
<img src="/images/2014/05/08/kusher-may-8-three.jpg" alt="">
Although this is a large sum, it has reduced from its peak of $9.064 billion in 2007/08.
Over the 2011/12 financial year, 629,230 individuals recorded a gross profit from their investment properties with the total profit recorded at $5.939 billion or $9,439 per investor per annum. Conversely, 1,266,540 taxpayers claimed a loss, with total losses reaching $13.798 billion. On a per person basis, this equates to $10,895 per annum.
Negative gearing continues to be a contentious issue and feature of the tax system which is unique to Australia.
Another point worth noting is that the data in the 2011 Census shows that the government only owns and rents out around 4.1% of total housing stock; conversely dwelling approvals data shows that a very small proportion of new housing approvals are granted to the public sector.
<img src="/images/2014/05/08/kusher-may-8-four.jpg" alt="">
Looking at these two individual results, it would suggest that the government has little interest in building or managing rental accommodation. This suggests that negative gearing is in place to encourage developers to build new rental accommodation and private individuals to act as landlord for those who aren’t in a position to own their own home.
While it would make sense to apply negative gearing only to newly constructed properties, politically it would likely be unpopular. Furthermore, if negative gearing was to be removed the government would likely have to play more of a role in constructing new homes and managing a portfolio of properties. On balance, they probably see that foregoing almost $8 billion in taxation revenue is more cost effective than developing and managing a greater proportion of new housing stock.
</body></html>

Slight fall in number of negatively geared property investors

<html><body>
The Australian Bureau of Statistics (ABS) released dwelling approvals data for March 2014 earlier this week.  Although the monthly reading recorded a fall, the trend of the data showed that the number of approvals is continuing to rise.
<img class="aligncenter size-full wp-image-3203" src="https://blog.rpdata.com/wp-content/uploads/2014/05/Chart-1.jpg" alt="Chart 1" width="500" height="181">
Total dwelling approvals fell by -3.5% (seasonally adjusted) over the month however, they are still 20.0% higher year-on-year. 
House approvals fell by -0.5% over the month compared to a much larger -7.5% fall in the more volatile unit category. 
Year on year both houses and units have recorded a significant increase, up 19.1% and 21.3% respectively.
<img class="aligncenter size-full wp-image-3204" src="https://blog.rpdata.com/wp-content/uploads/2014/05/Chart-2.jpg" alt="Chart 2" width="500" height="179">
The month-to-month index is inherently volatile; as a result we prefer to look at the rolling annual number of approvals.  Over the 12 months to March 2013, there were 188,153 dwelling approvals nationally.  This was the highest annual number of approvals since the 12 months to January 1995.  Annual house approvals outweighed unit approvals with 104,598 and 83,554 approvals respectively.  House approvals are at their highest level since April 2011 while unit approvals are currently at an all-time high.
With interest rates currently set at low levels, population growth quite high and property values rising, developers are becoming more comfortable in seeking applications for new developments.  Of course this is just the approval stage and it will be interesting to see what proportion of these approvals actually make it to commencement in the near-term.
<img class="aligncenter size-full wp-image-3205" src="https://blog.rpdata.com/wp-content/uploads/2014/05/Chart-3.jpg" alt="Chart 3" width="500" height="181">
Across the individual capital city markets the annual number of approvals is also generally trending higher with record high approvals in some capitals.  Following is the annual number of approvals across the capital cities with the annual change in brackets: Sydney 38,436 approvals (35.7%), 42,231 (2.7%) in Melbourne, 19,566 (43.8%) in Brisbane, 8,264 (36.4%) in Adelaide, 24,375 in Perth (45.1%), 770 (5.8%) in Hobart, 1,637 (-23.7%) in Darwin and 5,157 (27.6%) in Canberra. 
As you can see dwelling approvals are generally trending higher over the past year. 
In fact dwelling approvals over the year were at a record high level in Sydney and Perth. 
In Melbourne dwelling approvals are at their highest level since November 2011, Brisbane approvals are at their highest level since July 2004, in Adelaide approvals are at their highest level since August 2011, Hobart approvals are at their highest level since January 2013, Darwin approvals are trending lower and Canberra approvals are at their highest level since February 2012.
<img class="aligncenter size-full wp-image-3206" src="https://blog.rpdata.com/wp-content/uploads/2014/05/Chart-4.jpg" alt="Chart 4" width="500" height="177">
The other interesting evolution of the market is the ongoing rise in prominence of unit approvals. 
The number of unit approvals is at a record high in both Sydney and Brisbane.  As a proportion of all dwelling approvals, more than 50% of all approvals over the past year have been for units rather than houses in Sydney, Melbourne, Brisbane, Darwin and Canberra.  Sydney has consistently approved more units than houses for the past 20 years and both Darwin and Canberra have approved more units than houses consistently since 2010. 
The rising prominence of unit approvals in Melbourne and Brisbane is a relatively new phenomenon with unit approvals over-taking those of houses in Melbourne from August 2012 and in Brisbane from June 2013.
It is encouraging to see that dwelling approvals are trending higher nationally and across most capital cities. 
This is a desired outcome of low interest rates with the Reserve Bank hoping that a pick-up in dwelling construction can somewhat offset falling mining investment.  New dwelling construction also has a significant multiplier effect throughout the economy creating jobs and encouraging additional retail spending.
The main challenge will be that in many cities we are seeing an unprecedented level of units approved for construction.  Certainly demand for units has risen over recent years however, the pipeline of approvals is at record levels which are not yet tested.  Obviously most developments will need a level of presale to trigger finance to commence construction and it will be interesting to see how many of these unit approvals actually make it to construction phase over the coming months and years.
</body></html>

Highlights from the March 2014 building approvals data

<html><body>
The Australian Bureau of Statistics (ABS) released Consumer Price Index figures for the March 2014 quarter earlier this week. 
The data showed that over the first quarter of the year inflation was recorded at 0.6%, down from 0.8% over the final quarter of last year.
Over the past year, inflation has been recorded at 2.9%.  The Reserve Bank (RBA) has an annual inflation target of between 2% to 3% over the medium term and although the reading is at the higher end of that band it is still within the range.
<img class="aligncenter size-full wp-image-3147" src="https://blog.rpdata.com/wp-content/uploads/2014/04/Chart-12.jpg" alt="Chart 1" width="500" height="184">
<img class="aligncenter size-full wp-image-3148" src="https://blog.rpdata.com/wp-content/uploads/2014/04/Chart-22.jpg" alt="Chart 2" width="500" height="179">
Interestingly, non-tradable (or domestic inflation) was outside of the target range at 3.1% but has fallen from 4.2% a year ago. On the other hand, tradable (or imported inflation) was recorded at 2.6% up from -0.2% a year ago.
<img class="aligncenter size-full wp-image-3149" src="https://blog.rpdata.com/wp-content/uploads/2014/04/Chart-31.jpg" alt="Chart 3" width="500" height="184">
Turning the focus specifically to housing, the housing component of CPI has increased by 3.6% over the 12 months to March 2014, its lowest annual reading since June 2012. 
Across the housing sub-categories, new dwelling purchases by owner occupiers rose by 2.4% over the year with relatively tame growth also recorded for: maintenance and repair of the dwelling (2.5%), rents (2.9%) and other housing (4.7%).  Water and sewerage recorded the greatest annual rise at 10.8% followed by: property rates and charges (7.9%), gas and other household fuels (6.9%), utilities (6.8%) and electricity (5.2%).
The 2.9% annual increase in rents was the lowest reading since June 2006.  Similarly, the 5.2% annual increase in electricity was the lowest annual rise since June 2007.  On the other hand, the 10.8% annual increase in water and sewerage was the greatest rise since the 12 months to June 2011.
Another important consideration is the impact of inflation on home values.  Calculating ‘real’ home values by adjusting the RP Data-Rismark Home value Index for inflation provides valuable insight.
<img class="aligncenter size-full wp-image-3150" src="https://blog.rpdata.com/wp-content/uploads/2014/04/Chart-41.jpg" alt="Chart 4" width="500" height="178">
As the above chart highlights, once you adjust for the impact of inflation the level of capital growth over the longer term is much lower. 
In fact, when you adjust for inflation, combined capital city home values peaked in the September 2010 quarter and are still -1.8% lower than that level.
<img class="aligncenter size-full wp-image-3151" src="https://blog.rpdata.com/wp-content/uploads/2014/04/Chart-51.jpg" alt="Chart 5" width="500" height="182">
Over the 12 months to March 2014, combined capital city home values have increased by 10.6% however, when you adjust for inflation the rise has been a lower 7.5%. 
Across each city the rate of capital growth over the year is somewhat lower when you adjust for inflation and markets such as Hobart and Canberra which have recorded low levels of value growth have actually recorded value falls.
<img class="aligncenter size-full wp-image-3152" src="https://blog.rpdata.com/wp-content/uploads/2014/04/Chart-6.jpg" alt="Chart 6" width="500" height="184">
Home values across the combined capital cities are currently 7.2% higher than their previous peak according to the RP Data-Rismark Home Value Index. 
However, as mentioned above, when values are adjusted for inflation the story is quite different with values -1.8% lower. 
Across every capital city except for Sydney home values are lower than their previous peak in inflation adjusted terms.
<img class="aligncenter size-full wp-image-3153" src="https://blog.rpdata.com/wp-content/uploads/2014/04/Chart-7.jpg" alt="Chart 7" width="500" height="179">
Looking at the compound annual rate of value growth over the past five, ten and 15 years in inflation adjusted terms you can see some interesting trends.  Sydney home values have increased at an annual rate of 3.6% over the past five years, but earlier soft market conditions have resulted in value growth of just 0.4% pa over the past decade.
Brisbane home values have fallen at a rate of -2.3% per annum over the past five years and over the same period Adelaide home values are -1.0% lower per annum, Perth values have fallen by -0.2% per annum and Hobart values have declined by -3.1% each year. 
Over the past decade, Darwin has been the standout performer with values rising by 5.9% per annum and the weakest market has been Hobart where values have fallen at a rate of -0.1% each year.
With mortgage rates at such low levels and the 10 years of no ‘real’ growth in Sydney home values it goes some way to explaining the rising demand and surging home values. 
Melbourne is also seeing strong capital growth but when compared to Sydney has been a much stronger capital growth performer over the past decade.  Despite a weak five years in terms of capital growth we are yet to really see the housing market heat up in Brisbane and Adelaide. 
In Perth the housing market was strong early in this growth phase however; capital growth is now fading despite the fact that values are still lower in real terms than they were five years ago.
</body></html>

Inflation remains contained within the RBA's target range

New apartment developments with uninterrupted, north-facing views over Perth's Swan River are exceptionally rare.

Recognising just how limited those opportunities are, <a href="https://www.apartments.com.au/developers/edge-visionary-living">Edge Visionary Living</a>, one of Perth's most respected builder-developers, targeted <a href="https://www.apartments.com.au/developments/applecross-wa-6153">Applecross</a>, assembling an unrepeatable 6,342 sqm riverfront site on the corner of Moreau Mews and Canning Beach Road to create one of Perth's only new north-facing apartment developments directly overlooking the Swan River.

Today, <a href="https://www.apartments.com.au/buildings/riviere-residences-applecross-59-canning-beach-road-applecross-wa-6153">Rivière Residences</a> offers buyers a unique opportunity to choose between completed residences ready to move into now and off-the-plan homes in the final stage, Rivière West.

[smartcode_project:default project_id=28384 project_image_fid=3823]

Across the completed East and Central buildings, residents are already enjoying the development's luxury amenity, while two of the precinct's hospitality venues are now open.

The completed component of the development gives buyers the advantage of experiencing the finished product firsthand, including its uninterrupted river views, while still having the opportunity to secure a residence in the final stage.

"People are wowed by the view and the quality of the apartments,"&nbsp;Edge Visionary Living Sales Executive, Holly McSweeney, says.

"They're looking for the convenience of lock-and-leave living, but they're not looking to downsize on quality."

[smartcode_project:default project_id=28384 project_image_fid=3826]

The rarity of the development hasn't been lost on prospective buyers, McSweeney says.

For McSweeney, it all comes back to a location that is becoming increasingly difficult to replicate.

"Location, location, location," she says. "We are nestled right on the front of the Swan River. You can never get built out, so wherever you are in Rivière Residences, you've got views of the river forever."

The unique waterfront position has resonated particularly strongly with local downsizers. McSweeney says many buyers are long-time Applecross residents looking to transition from large family homes into a luxury apartment without sacrificing space, quality or the lifestyle they've enjoyed for decades.

<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/N_FowNW0wu8?si=vb25XFq1wZ-iufAW" title="YouTube video player" width="560"></iframe>

A major focus for Edge in recent years has been resident amenity. Across its apartment portfolio, from beachfront developments in Scarborough to luxury towers in South Perth, the developer has increasingly invested in the spaces beyond the apartment itself.

The strategy has largely been shaped by downsizer demand. Many buyers are moving from large family homes with swimming pools and established gardens. While they're looking to leave the maintenance behind, they don't want to compromise on lifestyle.

At Rivière, <a href="https://www.apartments.com.au/architects/hillam-architects">Hillam Architects</a> designed the resident facilities as an extension of each apartment. A 25-metre heated swimming pool takes advantage of the north-facing river outlook, complemented by a large gym, sauna and steam rooms, private dining spaces, residents' lounges, a cinema, games room, and dedicated wine and whisky rooms.

[smartcode_project:default project_id=28384 project_image_fid=372542]

The waterfront location has also proved to be a major drawcard. Residents are within walking distance of the Raffles Hotel, South of Perth Yacht Club, the Heathcote Cultural Precinct and the cafés, restaurants and boutiques along Ardross Street.

Beyond the location and amenity, McSweeney says many buyers take confidence from Edge's fully integrated development model.

Having delivered apartments across Perth for decades, Edge now designs, develops and constructs its projects in-house, giving the company greater control over quality, delivery and the finished product.

"What I love is when people walk through their apartment for the first time and say, 'This is better than what we imagined,'" McSweeney says. "We hear that all the time."

Completed apartments in the East and Central buildings are now available to inspect by appointment, while Rivière West, the final stage of the precinct, is expected to be completed in the first quarter of 2027.

[smartcode_project_cta:default project_id=28384]

Joel Robinson

North-facing Swan River views drive demand at Rivière Residences in Applecross

Nearly 60 per cent of apartments at McNab Group's $220 million The Tannery development in Brisbane's West End have sold ahead of the project's public launch, including a suburb-record $2.57 million sale for a two-bedroom apartment.

The early sales campaign has secured buyers for 50 of the project's 87 apartments, highlighting continued demand for larger owner-occupier apartments that combine generous floorplans with premium lifestyle amenities in one of Brisbane's most tightly held inner-city suburbs.

[smartcode_project:default project_id=143337 project_image_fid=374768]

McNab Group Executive Chairman Michael McNab said selling more than half the project before launch reflected changing buyer expectations.

"Selling more than half the project before public sales open tells us buyers are actively seeking apartments that offer something genuinely different," McNab said.

"Today's buyers are looking beyond four walls. They want homes that genuinely enhance the way they live, with spaces that support health, connection and everyday wellbeing."

[smartcode_project:default project_id=143337 project_image_fid=374767]

A key point of difference for the project is the adaptive reuse of the heritage-listed Dixon's Tannery building, which will become The Retreat, a residents-only wellness precinct rather than being redeveloped into additional apartments.

The Retreat will feature a sauna and steam room, hot and cold plunge pools, a commercial-grade gym, Pilates studio, cinema, library, co-working spaces and private dining room. Rooftop amenities will include a swimming pool, landscaped gardens, outdoor entertaining areas and dog-friendly spaces.

[smartcode_project:default project_id=143337 project_image_fid=374760]

Designed by Cottee Parker Architects with interiors by Tom Mark Henry and landscape architecture by Aspect Studios, The Tannery comprises 87 two, three and four-bedroom apartments across 11 levels overlooking the Brisbane River.

Cottee Parker principal Dee Passenger said preserving the original tannery building had been central to the project's design.

"The easy option would have been to maximise the site's development potential with additional apartments. Instead, McNab has chosen to preserve the original tannery as a shared wellness retreat, ensuring this important piece of Brisbane's history remains at the heart of the community."

Passenger said sustainability also played a key role in the design, with materials from the original industrial site salvaged and repurposed throughout the development.

[smartcode_project:default project_id=143337 project_image_fid=374761]

Motiv CEO Carly Cottam said buyers had responded strongly to the combination of larger apartments, wellness facilities and the West End lifestyle.

"We are seeing more buyers looking for homes in the sky that provide the space and functionality of a traditional home, while benefiting from the convenience and lifestyle that apartment living brings," Cottam said.

She said purchasers included both owner occupiers and investors, with demand coming from local buyers as well as interstate purchasers.

Coinciding with the public launch, McNab also announced a partnership with Queensland Ballet, whose neighbouring Thomas Dixon Centre shares historical ties with the original Dixon family.

Located on a 4,465 sqm site at 439 Montague Road, The Tannery overlooks the Brisbane River and is around 10 minutes from the CBD.

Construction is underway, with completion expected in the second half of 2027.

[smartcode_project_cta:default project_id=143337]

More than half of residences sold before public sales as McNab announces significant partnership with Queensland Ballet

McNab's The Tannery nears 60 per cent sold before public release, sets two-bedroom West End record

Iwan Sunito's vision for a landmark mixed-use precinct in Sydney's Inner West has taken a major step forward, with approval granted for the $1.9 billion Five Dock development first unveiled earlier this year.

The approved scheme by <a href="https://www.apartments.com.au/developers/one-global-capital">One Global Capital</a> will deliver an 80,500 sqm mixed-use precinct comprising 840 apartments, integrated hotel accommodation, commercial and retail space, alongside publicly accessible open space designed to create a new destination for the growing suburb.

"This is a significant milestone for One Global Capital and for the future of housing delivery in Sydney," Sunito said.

"The Housing Delivery Authority was established to identify major housing projects capable of delivering meaningful supply more efficiently, and we are delighted that Spencer Street has been recognised as one of those projects.”

He said the declaration reflected the rapid progress achieved since acquiring control of the site.

"In less than seven months we have progressed from taking control of the site to securing entry into one of the NSW Government's most important planning pathways. It reflects the experience of our team, the strength of our consultant group led by Urbis, and our long-term commitment to delivering transformational projects that contribute to Sydney's future."

When the project was revealed earlier this year, Sunito described the opportunity as one of the strongest development sites he had worked on.

"I probably hadn't appreciated the uniqueness of the site until more recently when putting together the concept plans," Sunito said.

"The proximity to the water, and the golf course opposite, is unlike any other part of Parramatta Road. We have a unique position and view corridors over the water that makes this one of the best sites I've worked on."

The development has evolved since its initial announcement, with the approved plans increasing the residential component from the originally proposed 750 apartments to 840 homes while retaining the project's focus on creating an integrated neighbourhood rather than a standalone residential development.

Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/a-city-within-a-city-iwan-sunito-flags-1-5-billion-mixed-use-precinct-in-five-dock">"A city within a city": Iwan Sunito flags $1.5 billion mixed-use precinct in Five Dock</a>

The precinct will combine apartments with hotel accommodation, commercial workplaces, retail offerings and public spaces, creating a mixed-use environment intended to serve both residents and the broader Five Dock community. The proposal also continues the collaboration between One Global Capital and internationally recognised architect <a href="https://www.apartments.com.au/architects/koichi-takada-architects">Koichi Takada</a>, whose previous work with Sunito includes Infinity, Arc and Skye North Sydney.

Takada previously said the design was driven by a philosophy of integrating nature into the built environment.

"The concept for this development is born from our design approach to naturalising architecture," Takada said.

"The public realm benefits from biophilic design that integrates generous landscaping, and the development is optimised for natural daylight, airflow and water views to foster wellbeing, sustainability and spaces that foster community interaction."

Sunito has consistently described the project as a "city within a city", with a strong emphasis on creating a destination that extends beyond housing.

"We want to create a development that's not only to be seen, but to be experienced by the whole local community," he said.

The approval comes as Five Dock continues its transformation ahead of the opening of the Sydney Metro West line, with the new Five Dock station set to significantly improve connections between the Inner West, Parramatta and the Sydney CBD.&nbsp;

The precinct will also benefit from its proximity to the Parramatta Road corridor, nearby waterfront parklands and established retail and dining offerings that have made Five Dock one of Sydney's most tightly held Inner West suburbs.

Iwan Sunito secures approval for $1.9 billion Five Dock mixed-use precinct

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]

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]

Cameron Kusher

Editor's Picks

Have something to contribute?

Developments

New apartments

New townhouses

News