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In spring we begin to see uplift in listings activity with more properties available for sale and subsequently an increase in auction activity. Spring also brings an improvement in the number of property sales, especially following winter, which is usually a slow period for the housing market.
Spring 2011 delivered a somewhat disappointing selling season, with sales volumes across the combined capital cities down by 3%; lower than they were in the spring of 2010 and with no noticeable improvement from volumes in autumn. The amount of stock available for sale during this period was continually increasing throughout the period to historic high levels, and home values were falling across each capital city market.
Although economic conditions are now not as strong as they were before the financial crisis, generally most indicators are stronger than compared with this time last year.
It is also important to analyse just how the economy is tracking compared with a longer-term average (10 years) so as to achieve a better understanding of the overall state of the economy compared with what may be considered “normal” based on the decade average.
While autumn represents the period when most property sales are made, spring is traditionally the season when more properties come on the market.
Overall, we’ve seen some positive movements for home values, with new stock being added to the market lower and each of the vendor metrics (selling time, vendor discounting and auction clearance rates) all showing an improvement.
Recent economic data also supports a period of stronger conditions with higher levels of consumer sentiment as well as an increase in housing finance commitments, lower standard-variable mortgage rates, and a greater rate of population growth and an improvement in retail trade.
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Further, given the poor performance of the housing market over the past year, any positive changes are generally moving from a very low base, albeit in the right direction.
Despite a more positive trend for many indicators compared with those of 2011, a comparison with the longer-term trend highlights that many of these indicators are moving off a low base. Additionally, significant challenges remain in the market including:
• The high stock levels;
• Transaction volumes which are below average;
• Lower growth in private sector housing credit;
• Lower levels of consumer sentiment;
• Lower numbers of owner occupier commitments for new loans;
• First-home buyer activity, which is well below average, and lower levels of full-time job creation.
These factors are likely to impact on the overall housing market performance coming in to this spring.
On the other hand, a number of measures are more positive than the 10-year average, and these are likely to be a positive for the housing market. These measures range from a lower number of new property listings entering the market and other measures such as inflation, which is well below average levels, below average standard variable mortgage rates, higher levels of annual population growth and a greater annual increase in retail trade.
Overall, the data indicates that generally the housing market is now in a stronger position than it was 12 months ago. Considering this, the spring selling season should be stronger this year than it was last year however, in comparison to recent years we would not expect the housing market to power along through spring in the manner that it has previously.
Cameron Kusher is senior research analyst at <a href="https://www,myrp.com.au" target="_blank">RP Data</a>.
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Spring selling season likely to be stronger this year than last, but don't expect it to power along: Cameron Kusher

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Over the four weeks to July 8 this year, RP Data tracked 301,414 unique properties advertised for sale across the country. While the number of homes available for sale is very high, the volume has been reducing and is actually about -7.4% lower than when supply levels peaked last November.
It’s important to note that the total listings count includes both new listings (i.e. properties that haven’t been advertised over the past six months) and re-listings (properties that have been advertised at least once previously over the past six months). The measurement of new listings compared with re-listings is an important one, as it provides an insight about why listings numbers are so high.
At a national level, RP Data counted 42,473 new properties advertised for sale over the four weeks to July 8, 2012. This figure was actually 4.6% lower than at the same time last year and 38.4% lower than the historic peak. New listings are currently at virtual record low levels outside of the highly seasonal Christmas/New Year period.
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Clearly, the large number of homes available for sale is due to a lack of absorption rather than a large number of new listings being added to the market. Transaction volumes are tracking about 13% lower than what was recorded at the same time last year. Additionally, homes are taking longer to sell. Both of these factors are contributing to the higher stock levels.
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An encouraging sign that market conditions are improving is that selling time has been trending shorter over 2012 and there has been a subtle improvement in transaction volumes as well. Both these factors, together with the fact that new listings have also been diminishing, is resulting in a reduced level of effective supply. How do we calculate the number of homes for sale? 
Firstly, we need to acquire the listings data. RP Data has an exclusive arrangement with Australia’s largest real estate portal, which provides us with a direct feed of all their listings data, including the complete address of the property that is not always available to the public. We also ‘key’ listings from all the major capital city and regional media around the country. The net result is that we are capturing what is likely to be close to 100% of all properties that are being advertised for sale around the country.
 
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For the next phase, we need to count the listings. This means initially de-duplicating the listings data which are gathered across multiple channels. This process occurs across a number of phases. All the addresses are standardised to account for differences in the text of the listing address. Next the ‘clean’ listings data is matched with our ownership database (RP Data maintains Australia’s largest property database that includes details on virtually every property across the country); in this way we are able to allocate a unique ID to each listing record that is associated with every listing ever recorded (this is how we can calculate the selling time and rate of vendor discounting, or simply provide the marketing history on a property). Any listings that are left over go through a manual matching process where possible. Any records that are not manually matched are excluded from the counts. For example, last week we started with close to one million listings across the country and, through our matching process, funnelled this number down to 301,414 unique properties.
Although at a national level the total amount of stock on the market is of concern, levels are easing in some regions. Across the states, total listings are lower than at the same time last year in Queensland (-2.1%), Western Australia (-4.3%) and the Northern Territory (-3%). Similarly, total listings volumes are lower than at the same time year in the capital city markets of Brisbane (-3.5%), Perth (-11.3%) and Darwin (-14.2%).
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Comparatively, listings are at much higher levels than the same time last year in Victoria (33.2%), Tasmania (25.6%) and the Australian Capital Territory (27.4%). At a capital city level, listings are sitting at elevated levels in Melbourne (31.5%), Hobart (22.9%) and Canberra (33.4%).
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Overall, there is a lot of stock which has sat on the market for a long period of time that has gone unsold. It is also reported that many of these home owners are unwilling to budge on their asking price and, as a result, homes are taking longer to sell and listing volumes are elevated.
In an ideal world, we would see some of these vendors remove their home from sale if they are not serious about selling. Clearly, a large proportion of vendors aren’t in a position where they ‘need’ to sell.
While listings remain at elevated levels it is likely to continue to restrict any significant recovery in the housing market; buyers simply have too many homes to choose from at a time when there is not urgency in their purchase making decision. The spring selling season will be a big test for the market. This is a time when new listings generally rise. Will the trend of lower listings continue into spring or will we see the trend of lower listing numbers continue?
Cameron Kusher is senior data analyst at <a href="https://www.rpdata.net.au/" target="_blank">RP Data</a>.
This article originally appeared on <a href="https://www.smartcompany.com.au/index.php" target="_blank">SmartCompany</a>.
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Elevated numbers of property listings to restrict any significant recovery in the housing market: Cameron Kusher

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Across each capital city housing market there is a significant gap between those houses that have the lowest rate per square metre and those that have the highest.
All figures quoted in this report are based on median sale prices over the 12 months to January 2012 and the average lot size of those properties that have sold. Although the analysis doesn't take into account qualitative factors such as the quality or size of the home, views, state of repair or other factors, the analysis provides a simple proxy for the premiums being paid for housing in certain areas.
Generally it is the inner-city suburbs within each capital city that have recorded the highest average rate/sqm over the past year. Not only are these suburbs characterised as being close to the city centre, they have also recorded a subsequent high median selling price and tend to have a fairly small average lot size. As a result of these conditions the rate/sqm is highest in these inner city areas and representative of the premium residents will pay to purchase in these regions even if it means they are acquiring a relatively small lot.
Focusing on those suburbs with the cheapest rate/sqm within the capital cities, it is typically acreage areas and/or those on the outskirts of the city that have made the list. Not only are these suburbs further away from the city but their acreage nature means that demand is typically lower for these properties. It is also important to note that often houses in these areas are not linked to town water and sewerage.
The table below details the five most expensive and five most affordable suburbs on a rate/sqm basis across each capital city.
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The beachside suburb of Tamarama in Sydney recorded the highest rate/sqm ($11,449/sqm) based on a median house price of $4,337,500 and an average lot size of 379 sqm over the past year. Tamarama has a relatively limited supply of houses and the fact that many have ocean views has resulted in the high median prices. In recent years the area has also seen the introduction of a lot more small lot housing which has contributed to the higher rates/sqm.
In fact, the five most expensive suburbs on a rate/sqm basis in Sydney were more expensive than any other suburbs across the other capital cities capital cities.
Sydney and Melbourne were the only two cities to have suburbs with an average rate/sqm of more than $5,000. Across Sydney, 26 suburbs had a rate/sqm in excess of $5,000 and in Melbourne seven suburbs did. Not surprisingly, all of these suburbs with a rate/sqm in excess of $5,000 were located relatively close to the city centre and many had a relatively small average lot size.
With a median house price of $398,000 and an average lot size of 72,387 square metres, Mt Mee in Brisbane had the lowest rate/sqm at just $5/sqm. Although the suburb is undoubtedly desirable, it is located 47 kilometres away from Brisbane and has very little local amenity. The large average lot size of 72,387 square metres also contributes to the low rate/sqm. Overall the evident trends are to be expected, residents pay a significant premium to be located close to the city centre and this is reflected by the fact that those suburbs close to the CBD have a much higher rate/sqm compared to those situated further away. Acreage properties on the outskirts of the city on the other hand may have a relatively high median sale price however, the large lot sizes result in a fairly low rate/sqm.
As inner-city areas continue to undergo densification we would expect that the rate/sqm in these suburbs will continue to increase. The reason being that not only is demand likely to remain strong and possibly increase for inner-city properties but also as many homes get knocked down and replaced by higher density construction, there will be fewer opportunities to purchase houses in these areas. As a result, the prices paid for these homes is likely to be higher as the supply of these homes is actually lower than it has been historically.
This article originally appeared on <a href="https://www.smartcompany.com.au/index.php" target="_blank">SmartCompany</a>.
Cameron Kusher is senior data analyst at <a href="https://www.rpdata.com.au/" target="_blank">RP Data</a>.
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Buyers pay a high premium for every square metre of inner-city living: Cameron Kusher

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Since the middle of the last decade, the average hold period of homes has continually increased as affordability barriers and high exit costs result in owners holding on to their properties rather than buying new ones.
The average hold period is calculated simply as the difference between the most recent date of sale compared to the previous date of sale. When we quote this figure, we determine an average based on all of the homes sold over the past year.
Across Australia, the average hold period for a house is recorded at 9.0 years and at 7.7 years for a unit. The average hold period has continued to increase over the past year. At the same time last year the hold period was recorded at 8.5 years for houses and 7.4 years for units. The average hold period for houses and units was fairly static until late 2005 and actually declined during the 2001-04 property boom, but it has since consistently increased.
At an individual capital city level, Melbourne houses and units have had the longest average hold period over the past year at 10.4 years and 8.3 years respectively. Sydney has the second highest average hold period. Given that Sydney and Melbourne are the most populous capital cities and also two of the most expensive, it is no surprise to see that they also have the longest length of tenure. It appears that home owners are increasingly likely to keep their current properties rather than upgrade due to the significant cost.
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The trend towards longer tenure is evident across each capital city market, all of which are showing an increase in the average hold period of both houses and units over the past year. As the table shows, the average hold period across each capital is much higher than it was five years ago and substantially higher than they were in 2000.
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When the average hold period data is paired with the annual volume of sales data, you can see that as the volume of sales has fallen, the length of ownership has increased. Of course, this is a logical explanation, if fewer transactions are taking place people still need to live somewhere, so they are going to be more inclined to stay in their current home. Click to enlarge
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The increase in the average hold period has also occurred over more recent years, a time in which growth in home values has been significantly lower. Of course, in March 2000 median home prices were much lower than they are today, which would suggest that housing affordability is a barrier to people moving and upgrading their home. The March 2012 national median home price was $400,000 compared to $168,000 in March 2000. Another point to note is that as homes get more expensive the amount of stamp duty payable on the sale increases as does the commission payable to the real estate agent. These may also be factors that are contributing to the increasing length of ownership.  
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The fact that the average hold period has been increasing as homes got more expensive and the rate of capital gain slowed along with the ongoing decline in sales activity has ramifications for the market and its participants such as:
<ul>
<li>There is less stamp duty collected by local and state governments because of fewer sales transactions.</li>
<li>There is less commission available for real estate agents and mortgage brokers.</li>
<li>There is less new business for financial institutions; as a result they have to compete more heavily in the refinance space.</li>
<li>Many families are likely to be living in homes which don’t appropriately meet their needs.</li>
<li>The data suggests that, instead of moving, people are looking to renovate their current homes.</li>
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Overall, we believe that the increase in the average hold period is a response to a number of factors. The main contributors are housing affordability and the costs associated with moving. However, it also probably has to do with the fact that the type of property available and the types of new housing stock being delivered are not meeting buyers’ needs. Whether that be cost, design or location, it is clear the stock available is not what buyers are looking for.
We anticipate that the average hold period will continue to increase over the coming years as private sector demand for credit growth remains below historic levels, sales volumes remain below their peaks and affordability barriers mean that people choose to upgrade their current home rather than upgrade to a new one.
Cameron Kusher is senior data analyst at <a target="_blank" href="https://www.rpdata.net.au/">RP Data</a>.
This article originally appeared on <a target="_blank" href="https://www.smartcompany.com.au/index.php">SmartCompany</a>.
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Affordability barriers mean home sellers staying put for longer: Cameron Kusher

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The May 2012 results of the RP Data-Rismark Home Value Index showed that capital city house values fell by 1.8% over the month compared to a 1% increase in unit value.
The trend has been evident for some time and although unit values have fallen by 1.5% over the past 12 months, detached houses have recorded much larger value falls of 5.8%.
Across each major capital city, the unit market has been more resilient to falling values over the past year compared with detached houses. This would seem to suggest that affordability barriers in the market are encouraging home buyers to look for more affordable housing options such as units and townhouses. This is highlighted by the fact that over the three months to May 2012, the median house price across the combined capital cities ($490,000) was $60,000 more expensive than the median unit price ($430,000).
Across each individual capital city market, the current difference between the median selling price of a house and unit is more than $55,000. In the two most expensive housing markets (Sydney and Melbourne), the difference between house and unit prices are $148,450 and $94,450 respectively. The differential between selling prices of houses and units lends further insight into the reason why the unit market has recorded lower value declines over the year than that of detached houses.
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Another likely reason for the superior performance of units is that, from an investment perspective, rental yields are typically stronger than they are for houses. Gross rental yields for houses are lower than they are for units in each capital city market except Darwin, highlighting that from an investment perspective units are often a superior option to houses. Click to enlarge
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The superior performance of units to that of detached houses has been evident over recent years. Over the past five years, capital city detached house values have risen at an average annual rate of 2.7% compared to a 4.2% increase in unit values each year. Looking back further to the past decade and 15 years, you can see that the long-term performance has seen house values increase at a more rapid rate than units.  
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The commonly held belief is that houses appreciate in value at a more rapid rate than units due to the underlying land value. However, that has simply not been the case in recent years. Importantly, unit values have outperformed houses over the past five years, a time over which capital city home values have appreciated at a much slower rate than the past 10 and 15 years. The superior performance of units over recent years would tend to indicate that buyers are seeking more affordable housing options and these are largely available in the unit market, as opposed to the detached housing market.
 
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Across individual capital cities, each one except for Darwin and Canberra has recorded a superior value change performance for units as opposed to houses over the past 12 months. The same situation is prevalent across the same cities over the past five years, which really highlights once again that buyers in the larger capital city markets are looking for more affordable housing options. This has resulted in a superior performance to that of detached houses in recent years.
 
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Across each capital city except for Darwin and Canberra, current unit values have experienced a smaller decline from the market peak than house values. Across the combined capital cities, unit values have fallen by just 2.8% from the market peak compared to an 8.1% fall in house values.
Overall, the data highlights that the popularity of units is increasing and they have outperformed houses in terms of value growth over recent years.
There are a number of reasons for the increasing popularity of units, namely: they are generally more affordable; there is a growing acceptance of units as a viable alternative to living in a detached house; units typically provide better rental yields; and are they are often located in more strategic locations with relation to surrounding amenity and transport infrastructure.
We would expect that the popularity of unit living will continue to grow over the coming years as buyers are increasingly conscious of housing location and cost.
Cameron Kusher is senior data analyst at <a href="https://www.rpdata.net.au/" target="_blank">RP Data</a>.
This article originally appeared on <a href="https://www.smartcompany.com.au/index.php" target="_blank">SmartCompany</a>.
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Unit prices more resilient than houses: RP Data's Cameron Kusher

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Auction clearance rates have been higher in 2012 than they were over the second half of 2011, but they remain quite low on an historic basis, reflecting the overall weak housing market conditions.
Despite the fact that capital city home values have fallen by 0.7% over the first four months of 2012, there has been an improvement in capital city auction clearance rates. Auction clearance rates provide one of the timeliest indicators of market sentiment and they have averaged 48.9% week-to-week in 2012 compared to 46.5% week-to-week over the second half of 2011.
The improvement in clearance rates has only been a subtle one; however, over the second half of 2011 auction clearance rates across the combined capital cities broke the 50% barrier only once. Over 2012 to date, auction clearance rates have been above 50% on nine separate occasions. Although there has been an improvement in clearance rates, they remain well below those levels recorded in 2009 and 2010, when property values were increasing quite strongly across most capital cities and, in particular, across the two markets in which auctions are a more popular form of sale (Melbourne and Sydney).
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As a result of the overall improvement in auction clearance rates, most individual capital cities have also typically been recording higher success rates at auctions. In Australia’s largest auction market, Melbourne, clearance rates have averaged 52.8% this year compared to 50.8% over the second half of 2011. In Sydney, clearance rates averaged 50.2% over the second half of 2011 compared to 51.9% over 2012 to date. These two capital cities accounted for more than 81% of all capital city auctions over the 2011 calendar year. Across every other capital city, except for Hobart and Canberra, the average auction clearance rate this year has been higher than it was over the second half of 2011.
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Although auction clearance rates have improved over 2012, the average number of properties going to auction has reduced. There are, on average, 17% fewer properties being taken to auction each week this year than there were over the second half of last year. Although auctions are proving to be more successful than they were last year, fewer auctions are taking place. This is, though, somewhat reflective of the fact that the total volume of properties available for sale has been at lower levels this year than it was over the second half of 2011, as well as the fact that fewer properties are listed for sale.
 
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In comparison with the average number of weekly auctions over the same period last year, there are currently 22% fewer auctions taking place each week.
 
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Auction clearance rates provide a very good lead indicator as to the performance of the housing market and the sentiment of buyers. It is, however, important to note that in 2011 auctions only accounted for 20.4% of all capital city house and unit sales. This is also reflective of the results over recent years and highlights that auctions are something of a niche market.
Of course, not every property is going to be a candidate to be taken to auction. If the subject property is fairly standard there is often little benefit in taking it to auction, whereas many believe that unique and prestige homes should be taken to auction to get the best price. The auction market is certainly more reflective of the prestige housing market, considering that 20.4% of all capital city homes sell at auction, however, these sales account for a much larger 27.5% of the total value of capital city home sales. These trends are replicated across each capital city except for Hobart.
Across individual capital cities there is a varying degree of popularity surrounding auctions. In Melbourne, auctions are the most popular of all capital cities, accounting for 31.6% of all sales, followed by Sydney (23.6%) and Canberra (17.2%). In every other capital city, market auction sales account for less than 15% of all capital city home sales. The results show that, overwhelmingly, most vendors prefer to sell by private treaty and, presumably, most purchasers prefer to buy via this method as well.
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Overall, it is important to recognise that auctions comprise only around one-fifth of the overall capital city housing market and tend to reflect the performance of higher priced homes. Nonetheless, auction clearance rates are a good, timely indicator of market sentiment and it is encouraging that they have been stronger in 2012 than they were over the latter part of 2011.
This article originally appeared on <a target="_blank" href="https://www.smartcompany.com.au/index.php">SmartCompany.</a>
Cameron Kusher is senior data analyst at <a href="https://www.rpdata.com.au/" target="_blank">RP Data.</a>
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Auction clearance rates improving but still at low activity levels: Cameron Kusher

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Finding a house or unit within 20 kilometres of the capital city that fits a small budget can be difficult, but there are still suburbs located 20 kilometres or less from the CBD of each capital city where relative bargains can still be had.
Across the combined capital cities, there are opportunities to purchase homes at prices below citywide median prices in locations that are still relatively close to the city centre. Of course, in the more expensive centres, these opportunities are more difficult to come by. There are still opportunities, however, within 20 kilometres of the city centre.
Across the combined capital cities, 34.8% of suburbs within 20 kilometres of the respective capital city centre have a median house price below $500,000, while, for units, the figure is a higher 73.6%.
These figures indicate that price sensitive purchasers still have some options closer to the city centre, in particular if they are prepared to purchase a unit.
It must be pointed out that across individual cities, the proportion of homes priced below $500,000 less than 20 kilometres from the city centre are quite varied, particularly for houses. Only 3.7% of suburbs less than 20 kilometres from the centre of Sydney have a median house price below $500,000, and the figures are also relatively low in Melbourne (21.7%) and Canberra (25.6%).
These results highlight the relatively high cost of houses in these cities and, subsequently, densification of inner city areas is occurring. For units, 42.5% of suburbs within 20 kilometres of the Sydney city centre have a median price below $500,000, while in each other capital city more than 65% of suburbs have a median price below $500,000.
Looking at the most affordable suburbs for median house prices across each city, some clear trends emerge from the results. Most of the suburbs are located more than 10 kilometres from the city centre; the exceptions are the flood-affected suburbs of Rocklea in Brisbane and Risdon Vale in Hobart.
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This article originally appeared on <a href="https://www.smartcompany.com.au/index.php" target="_blank">SmartCompany.</a>
Cameron Kusher is senior data analyst at RP Data.
 
 
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Relative property bargains can still be found within 20 kilometres of CBDs: Cameron Kusher

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The level of vendor discounting and the average time on market are important vendor metrics to understand as they provide an insight around selling conditions in the marketplace.
Vendor discounting is simply the difference between the price at which a property is initially listed for sale and the price at which it ultimately sells for.
Time on market, on the other hand, is the difference between the date when a property is first advertised for sale compared to the contract date of a sale.
Both measures are taken across private treaty sales only and are across just those properties that have sold. Given this, it provides a good indication of conditions to those vendors that are focused on successfully selling their home.
As the first graph shows, the level of vendor discounting for houses has been trending slightly lower over recent months.
Across the combined capital cities, vendor discounting is recorded at -7.2% for houses and -7.1% for units. The vendor discounting measure for houses is higher than it has been in recent years while for units it is the same as it was at the same time last year.
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<img src="/images/stories/rpmay111thumb.gif"> Across individual capital cities, vendor-discounting levels for houses are lower than at the same time last year in Perth and Darwin but higher elsewhere. Discounting levels for units are the same as last year in Sydney and lower in Brisbane, Perth and Darwin. In Melbourne, the level of vendor discounting is much higher than it was at the same time last year.
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The average number of days it takes to sell a house across the capital cities was also trending lower over the second half of 2011.
Typically there is a spike in the time it takes to sell a home early in the year and it has eased by March however, this year’s data is not reflecting these conditions for houses.
The average number of days it takes to sell a house was recorded at 77 days in March 2012 and it was 51 days for a unit. Both measures were higher than the 65 days and 47 days recorded respectively at the same time last year.
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At an individual capital city level, the average time on market is lower than at the same time last year for houses in Brisbane, Perth and Darwin.
For units, the average time on market is currently lower than 12 months ago in Brisbane, Perth and Darwin. In Sydney, the average time on market is relatively similar to that at the same time last year while in Melbourne it is taking much longer to sell property than it was last year.
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The improvement in vendor metrics in Brisbane, Perth and Darwin and the weakening conditions in Melbourne are reflective of the overall market conditions across these cities and highlighted by the amount of stock currently available for sale across these cities.
In Brisbane, total listings are just 2.3% higher than a year ago, in Perth they are -6.4% lower, in Darwin they are -16.4% lower and in Melbourne they are 36.1% higher.
The lower levels of discounting and average time on market in Brisbane, Perth and Darwin reflect improving market conditions in those cities. On the other hand, the significant increases in both measures across Melbourne reflect the cooling conditions across that market.
Overall, the elevated volume of stock available for sale reflects the low levels of demand for housing credit. Ongoing weakness across the housing market is likely to result in the average level of vendor discounting and the average time on market remaining at above-average levels.
Although this is likely to be the case, we have in recent months seen the amount of stock available for sale decline and the volume of sales stabilise. This may result in some further improvements in vendor discounting and time on market.
Cameron Kusher is senior research analyst at<a target="_blank" href="https://www.rpdata.com.au/"> RP Data</a>.
This article originally appeared on <a target="_blank" href="https://www.smartcompany.com.au/">SmartCompany</a>.
 
 
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Australian property markets becoming more balanced: Cameron Kusher

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Property-related taxes remain the largest source of revenue for local and state governments. Despite the deteriorating property market conditions in 2010-11 income from property taxes rose to new highs over the 2010-11 financial year.
Over the 2010-11 financial year, state and local governments received more than $33 billion in taxes from property-related channels, which was a record amount. Property-related taxes accounted for 47.3% of all state and local government tax revenue, down from 48.2% over the previous financial year. Despite the softer housing market conditions and ongoing weakness in the commercial property sector, total property related tax revenue increased by 4.6% over the year. This was following a record increase of 14.3% over the 2009-10 financial year.
It is somewhat surprising to see that the total value of property related taxation revenue increased over the year, especially when you consider that the nation's largest asset class (residential property) recorded weaker conditions. Our data shows that the total value of residential property transactions in 2010-11 fell by 17% compared with the previous financial year. Data also shows that over the financial year capital city home values fell by 1.4% and transaction volumes for homes were 20% lower than over the previous year. So how did state and local government possibly lift revenue?
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Firstly, it is important to note that the second graph highlights the different categories of tax revenue, their total value and their proportion of all state and local government property related tax revenue. Of each category of taxation there are really three big ticket areas: municipal rates, stamp duty on conveyances and land taxes. These three categories accounted for 93% of property tax revenue last financial year. Over the financial year, all three categories rose with municipal rates rising by the greatest amount (6.9%) followed by land taxes (4.1%) and a relatively minor increase in stamp duty on conveyances (0.3%).
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Given that both property values and transaction volumes have fallen, it is clear that stamp duty revenue has felt the effects of the soft housing market conditions. In fact, stamp duty has only risen over the year due to increases in the two most populous states (New South Wales and Victoria). In each other state stamp duty revenue has fallen, and in 2010-11 it was 14.1% lower than its record level of $14.3 billion in 2007-08.
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Increases in land tax charges and council rates have been the main drivers of growth in tax revenue over the last financial year. Considering that since the end of the 2010-11 financial year property values and transaction volumes have continued to fall, we would expect that in order to grow tax revenue state and local governments may be looking to again increase land tax and municipal rates as there is likely to be limited (if any) growth in stamp duty revenue.
Across each state and territory there were quite varied results in terms of changes to taxation revenue relating to property. The Australian Capital Territory (14.2%) and Victoria (10.7%) recorded the largest increases in property tax collection. On the other hand, the amount of property related tax collected fell over the year in: Western Australia and the Northern Territory (both -9.6%) and in Tasmania (-1.9%).
Across the land tax and municipal rates categories, the amount of land tax collected rose by the greatest amount in Victoria (18.7%) and Australian Capital Territory (12.5%) and fell by the greatest amount in Tasmania (-17.6%) and Western Australia (-0.6%). Municipal rate collection rose by the greatest amount in Queensland (8.6%) and Victoria (8.3%) and recorded the lowest increases in the Northern Territory (3.6%) and New South Wales (4.2%).
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Overall, we would expect that the rate of growth in property related tax revenues to remain fairly limited over the coming year. Property tax is clearly the most important source of revenue for state and local governments and as a result it is likely that these governments will look to make adjustments to grow revenue. Most notably, we already know that rates have increased over the year and some changes have been made to land tax calculations. CPI data from the ABS shows that over the first two quarters of the 2011-12 financial year, the property rates and charges housing sub-category has increased by 5.2% across the capital cities. We have also seen stamp duty concessions on the principal place of residence removed by the previous Labor Government in Queensland which was obviously an attempt to capture more revenue.
Considering the soft market conditions over the financial year to date, look for state and local governments to look for other ways to compensate the falls in property related taxes. Potentially this means higher rates of stamp duty or charging a greater amount of land tax / municipal rates.
Cameron Kusher is senior research analyst at <a href="https://www.rpdata.com.au/" target="_blank">RP Data</a>.
This article originally appeared on <a href="https://www.smartcompany.com.au/index.php" target="_blank">SmartCompany</a>.
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Property taxes continue to grow even as house prices slide: Cameron Kusher

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The Australian Bureau of Statistics (ABS) recently released demographic data for September 2011 which showed that population growth has stabilised over the year after falling for much of the past three years.
Over the 12 months to September 2011, Australia’s population increased by almost 320,000 persons (319,632). This is an improvement compared to the recent low of 312,016 over the 12 months to March 2011, however, it is much lower than the peak of 467,314 over the 12 months to December 2008. On the first graph, the dotted line represents average population growth over the past 30 years and the current rate of growth remains well above average.
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Across the states, Victoria has recorded the greatest numerical increase in population with almost 83,000 new residents. Population growth in Victoria, New South Wales and Queensland has accounted for 73% of the nation’s growth in population over the past year. Click to enlarge
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In percentage terms, Western Australia has been growing at a much faster rate than all other states and territories, increasing by 2.6% over the year. To put this into context, the Australian Capital Territory has been the second fastest growing region, with the population increasing by 1.9% over the year.
Over recent years, the slowdown in population growth has largely been the result of a targeted strategy to reduce overseas migration by the federal government.
Over the 12 months to September 2011 net overseas migration was 172,498 persons. Although this rate of migration is below the peaks of 315,686 persons over the 12 months to December 2008, the annual rate has been increasing over the past two quarters. Although the rate of net overseas migration has eased over the last few years it remains well above the long-term average (121,499).
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The other component of population growth is natural increase (births minus deaths) and it remains quite high despite some recent easing. Over the year, around 147,000 more persons were born than those that had passed away. Natural increase has eased slightly in recent times after peaking at 155,082 persons over the year to September 2009 however, it still remains well above the long-term average levels of around 130,000.
Over the past 12 months, natural increase has accounted for 46% of population growth compared to 54% of population growth which was due to net overseas migration. Much more recent data on long-term arrivals and departures published by the ABS suggests that the rate of overseas migration is set to increase.
Over the 12 months the January 2012, the net annual long-term arrivals was recorded at 248,530 persons, and this figure has increased by 24.6% compared with January 2011. Given this increase, we would expect that net overseas migration will increase over the coming quarters and subsequently, population growth is also likely to increase at a faster rate. The likelihood of higher rates of population growth are likely to provide some debate, especially considering that many expect the unemployment rate to increase over the coming year. Skilled overseas labour is important especially within the mining and resources sector where there are labour shortages.
Of course, higher population does bring some potential problems, as it increases the demand for housing, the need for infrastructure investment and demand for essential services. There are also environmental impacts of population growth with more demand for electricity and gas, building materials for homes and more pollution.
On the other hand, increases in population, particularly skilled working age population growth, increases the tax base and helps boost revenues for all levels of government. It also increases demand for goods and services across the economy.
Population growth is a balancing act and both sides of politics have argued that they don’t believe the record high rates of population growth recorded over 2007 and 2008 were appropriate. Given this, it will be interesting to see how much further the rate of net overseas migration increases over the coming quarters.
Cameron Kusher is senior research analyst at<a href="https://www.rpdata.com.au/" target="_blank"> RP Data</a>.
This article originally appeared on <a href="https://www.smartcompany.com.au/" target="_blank">SmartCompany</a>.
 
 
 
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Australia's population growth balancing act: RP Data's Cameron Kusher

Melbourne developer Spacious Group has completed Voyage Altona, one of the closest new apartment developments to Altona Beach.

Off the plan purchasers have started moving into the 49-apartment project on Pier Street, with the remaining move-in-ready one-, two- and three-bedroom apartments starting from just over $500,000.

Display apartments have now been fitted out, allowing prospective buyers to inspect the completed residences by appointment.

[smartcode_project:default project_id=112195 project_image_fid=372638]

The completed apartments feature open-plan living and dining areas which extend onto private balconies and terraces, while full-height glazing maximises natural light throughout the interiors.&nbsp;

Hybrid timber-look flooring, stone benchtops, Miele appliances, porcelain-tiled bathrooms and generous storage feature throughout the building which also features landscaped communal areas, expansive shared terraces, lift access and secure on-grade parking.

Drawing inspiration from its bayside setting, Voyage adopts a restrained palette of warm neutral tones and textured finishes. Many of the apartments take advantage of views across Port Phillip Bay, while the indoor-outdoor living spaces have been designed to make the most of the coastal outlook.

[smartcode_project:default project_id=112195 project_image_fid=3286]

Voyage was developed to address what Spacious Group identified as an undersupply of higher-quality apartment product in Altona, with a focus on owner-occupiers looking to remain within the bayside community.

"Voyage responds to very strong local buyer demand for quality, owner-occupier-focused product," says Barry Plant Projects Director Jarrod Farey, who has handled sales since the project's launch.

"The project delivers an elevated lifestyle proposition, with its design and quality of finish far exceeding anything previously produced in the area, as well as its proximity to Pier Street Village and the beach."

The majority of purchasers have been local downsizers and owner-occupiers looking to stay within the Altona community but who previously had limited opportunities to buy a brand-new apartment.

[smartcode_project_cta:default project_id=112195]

Joel Robinson

Spacious Group completes Voyage Altona in Altona's beachside precinct

Homecorp has secured approval for a $360 million apartment development at Budds Beach, paving the way for one of the Gold Coast's most amenity-rich residential projects to launch later this year.

Gold Coast City Council has approved Lýon Residences, a 32-level tower that will deliver 178 two and three-bedroom apartments across a prominent corner site at 8-10 Acacia Avenue and 25-27 Oak Avenue.

The approval comes as developers continue to invest in premium lifestyle-driven apartment projects on the Gold Coast, where owner occupiers are increasingly prioritising amenity as much as apartment size and location.

<a href="https://www.apartments.com.au/new-apartments/l-on-residences-25-27-oak-avenue-surfers-paradise-qld-4217">Lýon Residences</a> has been designed around a resort-style wellness offering, headlined by a Moroccan-inspired spa precinct featuring treatment rooms, a Nordic sauna and steam room, hot and cold plunge pools, a soaking pool and a residents-only juice bar.

The rooftop will include a heated infinity pool and spa, residents' lounge with private kitchen and bar, gymnasium, yoga and Pilates studio, outdoor entertaining areas and barbecue facilities overlooking the Surfers Paradise skyline.

<img alt="Lyon" data-entity-type="file" data-entity-uuid="2d3e29af-8793-486e-a684-52cef862241f" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-15%20at%204.32.26%E2%80%AFPM.png?VersionId=ayG2zpLf3SS6Zy8XmKDcQods4kVWb0gm" />

Homecorp Founder and CEO Ron Bakir said Budds Beach provided the ideal location for the company's latest luxury apartment project.

"Budds Beach represents one of the most unique and sought-after pockets of the Gold Coast, and Lýon Residences has been designed to reflect that sense of rarity and refinement," Bakir said.

The project arrives as wellness continues to become a defining feature of new residential developments both in Australia and internationally.

The latest Global Wellness Institute figures show wellness real estate remains the fastest-growing segment of the global wellness economy and is forecast to exceed $1.8 trillion by 2030. Australia continues to rank among the world's 15 largest wellness real estate markets, with developers increasingly integrating health, recreation and community facilities into apartment projects.

Queensland is also experiencing strong population growth, with the Gold Coast continuing to outperform many other Australian cities as demand for new housing remains elevated ahead of the 2032 Olympic and Paralympic Games.

Bakir said the project had been designed to respond to that shift in buyer expectations.

"Strong population growth and sustained demand across the Gold Coast continue to highlight the need for well-designed new housing supply. Lýon Residences responds directly to this demand while setting a new benchmark for residential living," he said.

Each apartment has been designed to maximise views across the coastline, the Nerang River and the Gold Coast hinterland.

Located just minutes from Surfers Paradise beach and the Broadwater, the development also offers easy access to the light rail network, Broadbeach and Burleigh Heads.

Early site works are underway, with construction expected to commence later this year.

Homecorp approved for Budds Beach apartment tower, Lýon Residences

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.

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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."

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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.

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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.

Cameron Kusher

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