<html><body>
Is it a case of banks don’t know what’s going on, or is it more a statement they don’t want to know? Pour yourself a fresh cup of coffee and read on. Don’t forget, your comments are welcomed and be sure to share them.
There are three main issues that banks appear to be very silent on and the question that is fitting in this property-climate is simply: “why are they so quiet?” A question which begs a straight answer; especially with the concerns surrounding foreign and local property investors buying newly built property and pricing local first-time-home-buyers out.
The three concerns and issues I refer to are:
·     Rental guarantees
·     Overly inflated commissions and
·     The scourge of the financial industry sector, selling property without a real estate industry license.
My immediate guess is, if you are riding the “Gravy Train” of “Overseas &amp; Local Investors” why should these seemingly illegal practices be of concern to banks? Again and for now, I’m just speculating that; it’s best to turn a blind eye than it is to confront what may well be considered unfair and unjust to local home buyers. After all, first-time-home-buyers aren’t the flavor of the month to all concerned, now are they?
It is my strong belief that the three topics noted, create an unfair advantage that has driven property values sky-high as developers reach for the skies.
Why is this unfair? I have previously discussed in other articles, “Rental-Guarantees” and “Overly-Inflated Commissions” are ultimately paid by the investor.
<a href="https://mail.privatemedia.com.au/owa/redir.aspx?SURL=buh8exBazU3bNSloPOr0rrJNNQesJNSotxGFO7YMkRixynWPdWzSCGgAdAB0AHAAOgAvAC8AdwB3AHcALgBsAGkAbgBrAGUAZABpAG4ALgBjAG8AbQAvAHAAdQBsAHMAZQAvAGkAbgB0AGUAcgBuAGEAdABpAG8AbgBhAGwALQBpAG4AdgBlAHMAdABvAHIAcwAtAGIAZQBpAG4AZwAtAGQAdQBwAGUAZAAtAHMAeQBkAG4AZQB5AC0AYQB1AHMAdAByAGEAbABpAGEALQBlAGQAdwBpAG4ALQBhAGwAbQBlAGkAZABhAA..&amp;URL=http%3a%2f%2fwww.linkedin.com%2fpulse%2finternational-investors-being-duped-sydney-australia-edwin-almeida"> </a>Ha! And you thought the developers were generous and paid for these right? Therefore, driving the values of the newly built properties upward.
Now allow me to break it down for you.
Rental guarantees:
What is common amidst most of the activity surrounding the sales of newly built property is the rental guarantees. Some rental guarantees are lasting for as long as 3 years.
It is my belief that any incentive made by the vendor or the agent to enhance the sale, the incentive has to be disclosed and must also form part of the contract of sale. The inducement being the rental guarantee but this is not limited to a rental guarantee.
In my time I have also seen cars and furniture packages form part of sales incentives, all in the aim to entice the investor to buy.
Inflated Commissions:
Yes, I know I speak out a lot about this very subject but when spruikers earn 5 times what the local agent earns in one sale, there has to be something wrong. If I don’t speak out, will the REI NSW step in or any of the REI’s for that matter?
I stopped holding that breath 4 years ago.
Nevertheless, the banking bodies should take note as their clients (the investors) are ultimately paying for this.
I also note that most of my endeared friends that have created this negative impact on the local home front, all sell newly built property. An arena where highly inflated commissions can and are paid out.
Selling without an industry license:
The temptation is just too great and the grass is greener on the other side. When so much money is at stake we have seen; brokers, accountants, financial planners and advisers jump the fence to moonlight as real estate agents as they lead their clients astray.
Again, this is an area where the banks should focus on, as local investors fall prey to the rogues within the financial sector.
A closer eye and perhaps a magnifying glass should be used to review contracts especially when the buyers are: Trustee Companies for Self-Managed-Super-Fund (SMSF) Trusts. More to the point when the property is new as this is the territory where these rogues, feast and boast about the high commissions earned.
Rental guarantees, overly inflated commissions and spruikers selling real estate without a license under the guise of calling themselves property-marketers: should send alarm bells ringing through the banking sector. But once more, why is there so much silence surrounding the very issues that have overly inflated the value of a new property in Sydney?
Getting to the nuts and bolts
Unethical real estate agents, spruikers, property marketing companies and the scourge of the financial sector; all have been ensnared by the prize of the high commissions and in turn lure investors by creating false perceptions of property: growth, demand, under-supply and high return on investment. How? By the simple use of instruments (such as rental guarantees) outside of the contract of sale and therefore, making the transaction questionable and unconscionable.
The falsely represented, high priced, new property sales ultimately filters down to established homes and we have what I refer to as “property-osmosis”. Property osmosis is an upward pull of established property's prices, caused by the exaggerated values of the surrounding new developments.
Most people are also under the impression that Overseas-Investors are paying for their properties with 100% cash. However, that it is not the case. Most investors buy property with a high deposit and borrow 50-60% through a loan vehicle.
In actual fact, Chinese citizens can only take up to $50,000 out of China through legal channels. However, there are means and ways to take $200K-$400K without much fuss.
Therefore, banks are more than happy to lend at 60% Loan to Value Ratios, as they are well secured even if the market dips by 20-30%. As you can see, there is very little risk for the banks.
Then there are our home grown Local-Investors that have been enticed to buy. Their property investment guides as previously mentioned are mainly, property spruikers and financial experts that assist in creating (SMSF) schemes to buy property. These vehicles also requiring low LVRs to purchase.
Typically, the SMSF schemes may borrow 70-80% to buy the investment property. Again the banking sector feeling secure on all counts.
What banks and Industry bodies need to do
The first and foremost prudent demand banks should place on the real estate industry is, for the “Sales Inspection Report and Agency Agreement” to be disclosed. Disclosure of what the “AGENCY” is being rewarded for the sale, will provide a twofold and strong indication to the valuer if there are any hidden agreements not being revealed.
·     Overinflated commissions
·     Payments made to agent/agency to cover rental guarantees and other incentives not disclosed in the Contract of Sale, which are passed on to the investor.
A copy of the agency/corporation license, should also accompany the contract of sale when providing the relevant documentation to the valuers. For the bank valuers to properly asses the true value of the property.
·     An agency or business name on the front page of the contract inserted after "Vendor's Agent" does not represent that the agent holds an industry license.
Perhaps at this very moment there is simply too much at stake to curve these questionable practices. The banks, financial institutions, real estate agents and we may also include the government, are all making too much money on this gravy train, to really care about our local first home buyers.
I am troubled nonetheless to think that all these practices that may be considered highly questionable if not illegal, have and continue to go on and right under the very noses of the banking institutions.
EDWIN ALMEIDA is licensee in charge of <a href="https://www.just-think.com.au/" target="_blank">Just Think Real Estate</a>.<a href="https://www.just-thin.com.au/"> </a>
He is also the creator of <a href="https://www.youtube.com/user/JustThinkProperty" target="_blank">Oz Real Estate.TV</a> and a presenter for <a href="https://propertyinvestingvault.com/" target="_blank">propertyinvestingvault.com</a>.
 
</body></html>

ealmedia-arK4DBYLjS

Banks turning a blind eye: Edwin Almeida

<html><body>
If you are confused by the acronym VPA, you’re not alone. The truth is, most of the REI and Real Estate Agents (REAs) don’t know how to properly account for this in their books. Most REAs are oblivious that they are flirting with deceitful conduct and are in breach of the REI Regulations by not disclosing and accounting, vendor paid advertising costs properly. 
For many the term or acronym VPA is not well known. Expanded, it makes a little more sense: Vendor Paid Advertising. But only a little more, particularly when the REA is asking for: a commission and for a marketing fee. 
For most agents, VPA is a lifeline to their existence. However, the majority of agents don’t realise the gravity of their failure to account for the advertising budget paid by the vendor. As much as it is a lifeline, it can also be the detriment to their agency.  
You could well say that VPA is an industry in itself. Many agency’s guidelines and training manuals spend a lot of their focus on, “how to get the most VPA from clients”. There are industry icons and business leaders that charge large amounts of money to train wannabe agents on how to bask in the glorious platforms of the VPA-agent kingpins. 
For me, the position I take is simply this. “What are agencies or REA’s offering that is so different to warrant for the vendor to pay on-top-off the commission?” Many are muted by this one simple question, and why? All because the answer is basically, not much. 
Not discrediting VPA altogether, I believe it HAD a purpose and served a function perhaps as early as 5-7 years ago. At a time when most buyers were only just beginning to venture into the internet to look for property. From then onward, the internet has become the lifeline of REAs marketing and source of clientele to buy property and at a highly reduced cost to obtain interest in their client’s properties.
 Why VPA was necessary - to an extent. 
<ul>
<li>Before the strong internet drive, most agencies relied on print media to draw the crowd. However, is print media still necessary in this climate?  and </li>
<li>Stand-out features, offered by the main property search-engines. </li>
</ul>
Are these features necessary to warrant for vendors to pay fees almost as much as commissions? 
I believe the answer to both is unanimously, no. In light of my discussions with colleagues, it is a general consensus that VPA is mainly used to really “promote the agent”. The exception to the rule I believe to be more in “commercial and industrial real estate”. 
The anti VPA advocates, our beliefs are threefold. 
<ul>
<li>First and foremost, if an agency receives funds from a vendor and is entrusted by the vendor for these to be used to advertise their property; it is deemed vendors funds and should be accounted for in the agency’s “trust account” not their general account. A practice not taught at the super giant VPA-seminar campaigns. </li>
<li>Second, and this goes back to my initial question; what is the agency offering for these extra funds (advertising costs) being charged to the client? </li>
<li>Third, is our own office belief that any funds provided by the vendor as an upfront marketing budget, the funds can be better spent on the presentation of the property. </li>
</ul>
A VPA agent’s reasoning for charging advertising fees:
I asked a few colleagues that have attended the VPA training seminars and they are adamant that it is necessary to charge clients a marketing budget on-top-off their commission. Most of my colleagues referring to costs of running a business to justify their reasoning. Their arguments mainly center on the following notions: 
<ul>
<li>Signboards and print media is costly. Hello! When was the last time you searched for property in a local newspaper and drove around neighborhoods till all hours of the night looking for signboards? 
</li>
</ul>
<ul>
<li>Advertising on the internet is costly. Yes it is, but every business has a cost to market itself and its products. Aren’t you receiving a commission to provide a service?
</li>
</ul>
<ul>
<li>We can’t break/split costs across all our properties and it’s difficult to manage. The regulations makes provisions to account for every expenditure to the client and in detail. Along with this is the requirement of disclosure of third party benefits received by the agency. Kickbacks, commissions and other fees paid for: printing and even online advertising, be it paid in shares or cash. 
</li>
</ul>
Showing the figures of costs to vendors:
I have been criticized in the past for questioning the collective voice of the REI that we are not being paid enough and therefore VPA is critical to run a business. Placing the legislative requirements on how to account for VPA to one side, but not dismissing these, lets look at the numbers for a second. The numbers of current cost to do business. 
Median property values approximately 3 years ago and average VPA charges.
<table cellspacing="0" cellpadding="0"><tbody>
<tr>
<td valign="middle">
Type Property
</td>
<td valign="middle">
Median Sydney
</td>
<td valign="middle">
Commission 2%
</td>
<td valign="middle">
VPA Average
</td>
<td valign="middle">
Cost To Vendor
</td>
</tr>
<tr>
<td valign="middle">
HOMES 
</td>
<td valign="middle">
$633,000
</td>
<td valign="middle">
$12,660
</td>
<td valign="middle">
$3,000
</td>
<td valign="middle">
$15,660
</td>
</tr>
<tr>
<td valign="middle">
UNITS
</td>
<td valign="middle">
$460,000
</td>
<td valign="middle">
$9,200
</td>
<td valign="middle">
$1,500
</td>
<td valign="middle">
$10,700
</td>
</tr>
</tbody></table>
 
Current values 2015. Median home property values and average industry VPA charges.
<table cellspacing="0" cellpadding="0"><tbody>
<tr>
<td valign="middle">
Type Property
</td>
<td valign="middle">
Median Sydney
</td>
<td valign="middle">
Commission 1.7%
</td>
<td valign="middle">
VPA Average
</td>
<td valign="middle">
Cost To Vendor
</td>
</tr>
<tr>
<td valign="middle">
HOMES 
</td>
<td valign="middle">
$850,000
</td>
<td valign="middle">
$14,450
</td>
<td valign="middle">
$5,000
</td>
<td valign="middle">
$19,450
</td>
</tr>
<tr>
<td valign="middle">
UNITS
</td>
<td valign="middle">
$630,000
</td>
<td valign="middle">
$10,710
</td>
<td valign="middle">
$3,000
</td>
<td valign="middle">
$13,710 
</td>
</tr>
</tbody></table>
My tips for people considering engaging an agent to sell a property.
When confronted with a ledger of costs before you even engage the REA to sell your home, simply ask the following questions:
<ul>
<li>Where will the money go to? General account or the Sales Trust account?</li>
<li>What are the individual costs for each proposed marketing idea/service that you recommend to be adopted?</li>
<li>How much commission does the office receive from third party service providers? And will these come off my bottom line?</li>
</ul>
Most reputable agencies that do work with VPA, will issue clear statements and provide value added services. Some of the services I consider value-added are:
<ul>
<li>Staging services</li>
<li>Professional photographers</li>
<li>Professional videos</li>
<li>Cosmetic make-overs of property in preparation for the marketing</li>
</ul>
The most commonly used rebuttal used by the VPA-agent is: if you want better exposure than your neighboring competitive listing, then we need to make your listing stand out. If the agent/agency is more focused on a signboard and local print advertising to stand out just remember this; signboards mainly advertise the agent not your property. 
EDWIN ALMEIDA is licensee in charge of <a href="https://www.just-think.com.au/" target="_blank">Just Think Real Estate</a>.<a href="https://www.just-thin.com.au/"> </a>
He is also the creator of <a href="https://www.youtube.com/user/JustThinkProperty" target="_blank">Oz Real Estate.TV</a> and a presenter for <a href="https://propertyinvestingvault.com/" target="_blank">propertyinvestingvault.com</a>.
</body></html>

VPA is not a dirty word: Edwin Almeida

<html><body>
In my previous article <a href="/expert-insights/the-higher-you-build-the-greater-the-fall-edwin-almeida">"Reaching For The Skies"</a> I eluded to the reasons why some of the towers being built in Sydney will fall. Not in a literal sense but more so from an economic point of view.
What will ignite the primer to set off the economic property meltdown?
I believe the major part of the answer can be found amongst all the lies international investors are being told. The lies that have attracted foreign investors to the glittery shores of Sydney, Brisbane and Melbourne. Like lambs to the developers feasting tables.
Under-supply, huge demand for rental accommodation and the fattest lie could well be that we still hold global recognition on the best standards for building and construction.Yeah right!! and pigs fly.
Return On Investment
The first lie being told and promoted to predominantly Chinese investors is; whatever we build, they will be occupied at a high yielding return. Simply, there will be a high rental return on the amount of money invested. An argument highly supported by the promoters of tales that persuaded many to believe stories of, under-supply due to substantial population growth. We build it, you buy it and we will fill them.
Nonetheless, investors bought and continue to buy. To sweeten the deal, rental guarantees were introduced. The 12 month rental guarantees given to investors in the past, are no longer sustainable due to increased property prices.
To accommodate for the now non attractive 12 month guarantees, we have seen a shift from the 12 month guarantees, to offerings of up to 3 years by some property marketing companies. An increase of time to the guarantee, to account for the rising cost of the property in order to keep feeding the investor’s greed and maintain the illusion of high performing returns.
The first proposition, may have been true in part and in the past. However, the tide has now turned due to the word being spread about high yielding returns, therefore, fueling a greater frenzy of speculative buyers.
An increase of buyers has led to greater demands to build more apartments, and now we have gone past saturation point. It’s certainly being felt in Brisbane, with more than 30,000 apartments about to be completed in the next 12 months.
Sydney, although a little slower, is by all means not too far behind. The only difference is the QLD market is mainly fueled by local investors: SMSF’s, first time mum-dad investors that attended wealth seminars and by Sydneysiders that have made small fortunes with new realized equity in their homes. Yes, not to mention the foreign investor.
Two outcomes have emerged; the first, over supply of property which is now starting to create concerns among property management teams as rental yields fall. The second, evidenced by our own property management teams and other office’s is the increase in percentage vacancy rates.
Get Rich Quick Schemes
The get rich quick schemes seemed to run at all levels. From the Marketing Agents to the developers to even the investors themselves.
The Marketing Agents, and I purposely avoid in calling these companies Real Estate Agencies, are receiving up to 10% or close to $50,000-$60,000 commissions on sales of $700,000 properties. These exuberant commissions encourages these agencies to exploit the international investor. Their own mates, family and friends.
The Investors on the other hand, have made some serious money. The ones that got in early that is. The ones that bought in markets where the values only reached $600,000 at the time and they were receiving $550/week rentals.
The newbies however, are now coming in to the same markets and with price tags of $850,000 – Hey stupid! The rents are still $550/week.
The developers, for the purpose of this article I will only concentrate on the NEW BREED (NB) of developers. The NB are also international investors that have no history in construction but have found a way to milk the system at a higher level. They have bought with them so much uncertainty and low level workmanship, it is staggering how some of their buildings pass certification requirements.
Unfortunately some of our local developers have been fanning the flames of this hot property market. Can you blame them? After all, they are running a business. Part of me does and another part of me doesn’t blame them. The part that does, is the side that questions the ethics around "marketing fees" to entice the International Investor by the Property Marketing Companies. Along with this, is the commissions paid to financial planners and the finance industry to also market some projects.
What will level this market will be no different to what we saw 10 years ago: oversupply, vacancy rates on high projections and the ongoing costs to investors to repair bad workmanship. Again I say, the only difference is; the towers are higher, deeper and bulkier. The higher they build, the greater the fall.
EDWIN ALMEIDA is licensee in charge of <a href="https://www.just-thin.com.au/" target="_blank">Just Think Real Estate</a>.<a href="https://www.just-thin.com.au/"> </a>
He is also the creator of <a href="https://www.youtube.com/user/JustThinkProperty" target="_blank">Oz Real Estate.TV</a> and a presenter for <a href="https://propertyinvestingvault.com/" target="_blank">propertyinvestingvault.com</a>.
 
</body></html>

The higher the building the greater the fall: Edwin Almeida

<html><body>
Many builders and civilizations have had the notion to reach for the skies to build their own versions of the Tower of Babel, be as gods in the developing world at their time.
I believe versions of these towers are about to emerge once again here in Western Sydney – Parramatta.
Two questions come to mind, as I recall previous residential towers that emerged some time ago and also not far from Parramatta. It was an event almost symbolic of the Babylonian culture to reach for the heavens. What we witnessed almost 10 years ago and what is happening now, seems to be a case of “deja vu” as builders, a decade later, are reaching for the skies once more.
The first question: Will these towers topple (not in the literal sense but in an economic one), as they did in the past? And secondly, how many developers, tradespeople and builders will go broke this time around as a result of them being built?
I recall some time ago when I was working with a property group, selling property in Westmead, it was “blue skies” for the developers. A term used for the money being made on the top floor apartments, a term representing the big bonus and very much symbolic of the amount of dollars that were made.
As I sell and assist with the sales of development sites currently, the same language has emerged again of “blue skies” and perhaps now because of the “Asian gravy train” sentiment being felt in Sydney. Whatever the reason, there is still the same ambition shown by developers to break through the clouds but also to break through cultural and economic borders where the financial bonus lie.
No different than what we witnessed about 10 years ago, construction cranes emerged all over Sydney. Robot-like staunches, building their lords' towers on an upward journey to break through the clouds. Distinctly however, the buildings weren’t as high. What is being built now will tower above and overshadow those developers' past exploits. Will this however be representative and signal a greater financial fall? Only time will tell. Looking back however, for many, it never ends well.
<img src="/images/2015/04/23/edwin%20april%2023%20two.jpg" alt="">
Construction cranes that are becoming more and more familiar around Parramatta CBD.
When the economic gods of yesteryears frowned upon the then developers, the excitement and calm before the storm that brewed then, are now emerging once again. The current excitement around property investing has led many to forget simple economics such as return on investment. Not to mention, the calm and tranquil overconfident approach that has made many believe that Western Sydney is sheltered from any property fall out.
Both excitement and placebo, fueled the ridiculous prices that were being paid for new apartments in the past and, once again, ridiculous prices are been paid. However, this time it may well be very different. Well, different from the last time when we saw the overarching towers emerge around Westmead but which had many local investors and developers lose thousands and millions of dollars.
<img src="/images/2015/04/23/edwin%20april%2023%20three.jpg" alt="">
Compared to what was being built in Westmead at the time, these buildings shown above overshadowed any other new building development nearby. Prices dropped from $440,000 to $320,000 overnight. Many of my clients were caught out half way during their construction face.
When the economic gods turned on the property market then and prices topple immensely below what properties were sold for off-the-plan, it hurt many investors along with smaller developers. It’s only recently that what properties were sold for in previous years off the plan that these prices are now being achieved on re-sales.
Put aside for a moment, the notion that there is an under-supply of property, the notion that we have run out of land to build and more-so the talks that our population is growing in uncontrollable numbers, which is foolishly driving prices through the proverbial ceiling. Think about the basic needs and concerns for sustainable development and affordable housing to accommodate the local market.
If the notion of undersupply was remotely true as we are lead to believe, why are rental vacancy rates pushing upward of 2% and climbing steadily? How is it that our property management team are experiencing greater delays in attracting tenants and at lower rental values and not only around Parramatta? Just some of the questions that have a bearing as to where we are headed.
<img src="/images/2015/04/23/edwin%20april%2023%20four.jpg" alt="">
Looking at the outer fringe figures for Sydney, the increase appears significant and growing steadily. Over the next three months I foresee a strong upward trend, due many developments in and around Parramatta coming to completion.
The primary concern I feel however, is the notion of job stability and security. I don’t believe we have one nor the other. With the high levels of unemployment recorded and as well as the need to have two high income earners to afford Sydney’s median entry level, it just doesn’t make any logical sense to buy into this overly heated market. Particularly in and around Parramatta and especially at the entry level prices paid by the passengers that arrive in the ‘gravy trains’ that developers feast on.
<img src="/images/2015/04/23/edwin%20april%2023%20five.jpg" alt="">
Nonetheless, these newly emerging towers are attracting sales figures, in and around $13,000 per square metre or $750,000-$800,000 for a two bedroom unit, in Parramatta and as far as Northmead. Excitement and placebo once more fueling the storm that is about to hit and it will hit hard.
However, more to the point is the nature of speculative buying fever fueled by the international dollar. It won’t take long for these fly-in, fly-out investors to find out that <a href="https://www.linkedin.com/pulse/like-lambs-yang-slaughter-read-how-asian-investors-being-almeida" target="_blank">not all that glitters is gold</a>. How they come and why they come will be at the center of the next article, part two of the series “Reaching For The Skies”.
The new towers that are being proposed to be built are taller, costly, bulkier and will overshadow what was ever built in the past. The three that come to mind as I speak to peers that work in the area are; the Northmead developments, Parramatta CBD and West Parramatta.
The old Parramatta Advertiser site alone, now being demolished, flags rumors of three towers being built that may well house up to 1,200 apartments. It is after all, an impressively large parcel of land. Rumors or not, distinctive traits of the last downturn are once more evident and forming the very strong overtones that angered the economic gods before.
<img src="/images/2015/04/23/edwin%20april%2023%20six.jpg" alt="">
Sitting with a local councilor and discussing the emergence of these towers, and the amount of apartment developments being approved, one cannot go past and reminisce how things changed overnight a decade ago and how the aftermath was rampant.
The grief caused didn’t discriminate as it hit many involved in the property market from; local investors to trades people to builders and developers. I am one to believe the devastation this time around just won’t be local to Sydney-siders.
EDWIN ALMEIDA is licensee in charge of <a href="https://www.just-thin.com.au/" target="_blank">Just Think Real Estate</a>.<a href="https://www.just-thin.com.au/"> </a>
He is also the creator of <a href="https://www.youtube.com/user/JustThinkProperty" target="_blank">Oz Real Estate.TV</a> and a presenter for <a href="https://propertyinvestingvault.com/" target="_blank">propertyinvestingvault.com</a>.
Photos courtesy of the author.
</body></html>

The higher you build, the greater the fall: Edwin Almeida

<html><body>
It’s no secret that the topic of underquoting gets under my skin and it should get under yours as well - many property buyers have fallen victim to this trap.
But let's set aside the practice of underquoting for a short moment and discuss other sleight of hand illusions of achieving high prices at auctions.
There are three schools of thought when it comes to achieving above the reserve for properties sold by auction.
Firstly, there is the thought that market forces are at work and have an uncontrollable bearing on the day of the auctions. Secondly, there is the marketing and methods of underquoting. Finally, last but by no means least, is the sheer ignorance by the industry experts when it comes to understanding property values. These points can be summarised as follows:
<ul>
<li>Market forces</li>
<li>Underquoting</li>
<li>Industry ignorance</li>
</ul>
Number 1: Market Forces 
A competent agent can and will gauge these external forces. This is one of the main reasons why vendors hire the “professional real estate agent” in the first place, isn’t it? The vendor wants to make sure they get the most value for their property. After all, we are on the field; we eat and breathe real estate for a living.
When <a href="/expert-insights/buying/buyers-needed-to-add-11-to-weekend-sydney-pre-auction-price-guidance">Jonathan Chancellor wrote, to expect to pay 11% above</a> what was being quoted as a price guide, we could say market forces were at play. Beyond the 10% tolerance prescribed by <a href="https://www.fairtrading.nsw.gov.au/pdfs/Property_agents_and_managers/estimatedpriceguideline.pdf" target="_blank">Fair Trade NSW</a> or <a href="https://www5.austlii.edu.au/au/legis/vic/consol_act/eaa1980145/s47a" target="_blank">the Victorian Estate Agents Act</a> however, it all becomes questionable. An example of how the 10% tolerance works, is shown below.
<img src="/images/2015/03/26/edwin%20mar%2026%20one.jpg" alt="">
Number 2: Underquoting
Without going into too much detail, please read my last article which references <a href="https://www.linkedin.com/pulse/lies-real-estate-property-auction-campaigns-day-1-part-almeida" target="_blank">underquoting</a> and focused on the cost to the real estate industry (REI), real estate agents (REAs) and most importantly, the unnecessary cost to the public.
I have been vocal about the <a href="https://www.linkedin.com/pulse/lie-lies-real-estate-property-auction-campaigns-edwin-almeida" target="_blank">Valentines Day $1 Auction</a> from the very first day. Now, another novel auction graces the media, the <a href="/news/vic/brighton-bathing-box-listed-with-150-000-guide">Brighton Bathing Box sale with a price-guide of $150,000</a>. That’s all it’s worth you say? Truth be told, late last year one sold at $215,000. A price-guide of 30% lower? Is this a deliberate ploy to draw a crowd and to entice buyers? <a href="https://www5.austlii.edu.au/au/legis/vic/consol_act/eaa1980145/s47a" target="_blank">Where are the Victorian regulators on this?</a>
It’s now sold, as you may know, for $276,000 - 84% above price guide.
Now, you may not be <a href="https://www.linkedin.com/pulse/lies-real-estate-property-auction-campaigns-day-1-part-almeida" target="_blank">“personally offended”</a> by campaigns with notions of underquoting, as in the case of the CEO of the REINSW. You, may also blame the <a href="https://www.dailytelegraph.com.au/news/nsw/agents-lured-into-under-quoting-tricks-real-estate-institute-of-nsw-president-says/story-fnpn118l-1227272725834" target="_blank">“greed of the market” and the vendor</a> as in the case of the President of the REINSW Malcolm Gunning.
It is however, <a href="https://news.domain.com.au/domain/real-estate-news/underquoting-real-estate-agents-have-nowhere-to-hide-if-they-break-the-law-20150316-1m0amu" target="_blank">simply illegal to underquote and no REA that values their licence and reputation</a> should be encouraged nor coerced into this illegal practice. More to the point, even if the vendors tell the REAs to break the law, must we?
Most of the industry would like the public to believe we have no choice, when deciding whether to break the law or not. The REI bodies seem fit to shift the blame away from the agents or the industry and instead want to blame the public and vendors.
Blaming the vendor seems to be the common thread among the RE Institutes around Australia; see article posted below. Blaming the vendor however, will not rid the industry of the practice of underquoting. It just seems to be a case of blame shifting – blame the vendor and greedy market, at will.
<img src="/images/2015/04/02/edwin-april-2-opne.png" alt="">
Source: Australian Financial Review, 9 October, 2012
Education, be it Gunning’s instinctive solution, is not the immediate short-term answer either. I would like to put forward a message to our valiant leaders in the Institutes: this practice of underquoting is well entrenched in the ranks of the Institute's membership.
It isn’t the vendors, nor the newly licensed REAs that came up with the novel idea of <a href="https://www.linkedin.com/pulse/price-low-watch-go-edwin-almeida" target="_blank">“price it low and watch it go”</a>. Underquoting, is an entrenched culture in the industry and has been for decades.
If it’s a short, sharp and quick solution that the Institute’s are looking for to bring credibility to our industry, here are some novel ideas:
<ul>
<li>Rid the root of the problem from the REINSW and REIV membership. Surprisingly or perhaps not, some may have even obtained their licences from the same Institutes.</li>
<li>Name and shame RE Institute members that do get caught out.</li>
<li>Ask the governing body, Fair Trade NSW to suspend licences and to do so immediately. Lets not protect the REI members that are creating the issues just because they appeared on national TV. Take a bold stand and clean our house before we try and sweep the streets.</li>
</ul>
You want partial self-regulation? This is a great start to show both, the public and NSW Fair Trade that we mean business. <a href="https://www.reinsw.com.au/imis15_prod/web/Posts/Latest_News/201404/REINSW_President_Malcolm_Gunning_calls_for_greater_professionalism.aspx" target="_blank"> </a>
"REINSW is advocating that we partner with the NSW Fair Trading to share responsibility for regulating the real estate profession,"<a href="https://www.reinsw.com.au/imis15_prod/web/Posts/Latest_News/201404/REINSW_President_Malcolm_Gunning_calls_for_greater_professionalism.aspx" target="_blank"> said Gunning.</a>
Number 3: Industry Ignorance 
Other than market forces, can we excuse most out of line sales and blame it on “ignorance”? Ignorance may be used as an excuse, but it is not a defence when there are legal ramifications. 
Within the current property climate, it appears agents hide behind “market forces” to cover up for their ignorance of the council’s changes to local land rezoning proposals, for the out of line sales. <a href="/expert-insights/nearly-100-above-the-initial-price-guide-underquoting-rears-its-ugly-head">Market forces and no comparable sales</a> is also used as an excuse when not being able to properly determine land and home values. Or is this just another tact to draw the crowd, be it a mix of sophisticated and novice buyers.
On the other hand, when it comes to boasting about achieving high sales figures and well above reserves, they are the first in line to publicly report their achievements.
What I would surmise is that most agents don’t fathom the possible monitory loss they can cause their vendors, if the property is sold at the price-guide given or even the reserve price on the day.
In the case of a Gladesville property sale, an agent boasted about the <a href="https://www.dailytelegraph.com.au/realestate/news/cottage-fetches-11-million-over-the-reserve-as-auctions-across-sydney-remain-hot/story-fni0cly6-1227262369554" target="_blank">$1,100,000 over reserve that was achieved</a>. Further West of Sydney’s CBD, in Guildford, we had another “stellar campaign” boasting a 25% above reserve accomplishment.
It’s clear; the REAs simply and frankly, did not know the true value of the land. I am surprised the vendors allowed them to go near the property and take such a risk. Or is there really more to the story?
Perhaps, Gunning president has greater insight that explains this phenomenon? He claims vendors have more to do with this issue than not as timid and innocent agents are <a href="https://www.dailytelegraph.com.au/news/nsw/agents-lured-into-under-quoting-tricks-real-estate-institute-of-nsw-president-says/story-fnpn118l-1227272725834" target="_blank">“lured by unrealistic expectations… and the greedy market”</a> to underquote.
One thing is for sure, agents can run around beating their chest, declaring what stellar campaigns were run as 20%-30% sales above reserve were achieved (which can only mean the agents didn't know the values of the property in the first place). Or, the alternative is the property was deliberately underquoted in the first instance.
It has to be one or the other my friends.
Nonetheless, blaming the vendor, whether or not it comes from high up the ranks of the REINSW or the REIV, is not going to cut the mustard in the court rooms. The "greedy market lured me" and "the vendor made me do it" just won’t fly.
Ignorance versus underquoting
Ignorance from agents, of what is going on in the proposed changes to the local council environment plans will cost vendors dearly. But why don’t we hear many vendors raise their voices and complain? Simply because these sales being published and boasted about, netted the vendor a sale above so-called expectations. Vendors truly believe the agents did a wonderful job.
Now, take a moment and think about the “what if” scenario. What if, the Gladesville and Guildford sales only achieved a figure to equal what the agents set as a price guide or the reserve?
For this very reason, I am of the opinion that agents need to go back to basics if they are going to play with the future of their vendor's assets and take risks by not knowing the true value of the property. Better yet, they should consider going back to selling used cars if this is how they intend to perform in this industry.
Its a risk that may have even cost the State of NSW dearly, as noted in the first sale of the <a href="https://news.domain.com.au/domain/real-estate-news/sydney-property-highlights-of-2014-20141219-12a1qv" target="_blank">Millers Point property sales</a>.
Not researching changes to local council planning, and not keeping up to date with property development rezoning is unprofessional, ignorant, and sheer laziness. Why exactly are you paying the agent a fee of 2.5% average? Do the math.
Therefore, either the agents are ignorant and one has to wonder why they have a licence in the first instance, or they are blatantly underquoting to draw a crowd – even if the crowd is purely made up of “sophisticated buyers”. There is no two ways about this fact.
We cannot excuse and blame market forces any longer for flirting with the law and peoples well-being. Vendors entrust our industry to uphold the regulations and guide them to the best possible outcome. An outcome that should be far removed from any notion that the REA broke the law, or was lured into breaking the law to achieve the best possible result.
Most off all, REAs cannot blame 'market forces' or 'no comparable sales' for being ignorant and gambling with the real possibility that they will undersell a property, for the person that placed full confidence in their professional expertise.
Next time you see headlines of great achievement in a sale by auction, ask yourself the question: underquoting or ignorance?
Here are the real figures achieved in the stellar campaigns run by the agents:
<table style="width: 460px;" border="1" cellspacing="0" cellpadding="0"><tbody>
<tr>
<td valign="top" width="123">
Property
</td>
<td valign="top" width="123">
Reserve
</td>
<td valign="top" width="123">
Sale price
</td>
<td valign="top" width="123">
$ above reserve
</td>
<td valign="top" width="123">
% Difference
</td>
</tr>
<tr>
<td valign="top" width="123">
Brighton
</td>
<td valign="top" width="123">
$150,000
</td>
<td valign="top" width="123">
$276,000
</td>
<td valign="top" width="123">
$136,000
</td>
<td valign="top" width="123">
84%
</td>
</tr>
<tr>
<td valign="top" width="123">
Guildford
</td>
<td valign="top" width="123">
$900,000
</td>
<td valign="top" width="123">
$1,130,000
</td>
<td valign="top" width="123">
$230,000
</td>
<td valign="top" width="123">
26%
</td>
</tr>
<tr>
<td valign="top" width="123">
Gladesville
</td>
<td valign="top" width="123">
$$1,750,000
</td>
<td valign="top" width="123">
$2,850,000
</td>
<td valign="top" width="123">
$1,100,000
</td>
<td valign="top" width="123">
63%
</td>
</tr>
</tbody></table>
A few things that I would like to clarify, and that is; I am not forming a campaign against auctioneers. Nor am I opposing the sale of land/property by means of auction. I am also in favor of high industry standards and ongoing education.
I’m against the misrepresentation and the deceptive conduct allowed to become a free for all.
Underquoting is an entrenched practice that both bodies – the REI and the RE Institutes – seem to quickly dismiss and in turn blame the vendor.
Isn’t it about time we took full responsibility and acted like the professionals the public trust us to be? Now is the time to make the difference and stop blame-shifting, even if our REI leaders have apparently found it so easy to do.
EDWIN ALMEIDA is licensee in charge of <a href="https://www.just-thin.com.au/" target="_blank">Just Think Real Estate</a>.<a href="https://www.just-thin.com.au/"> </a>
He is also the creator of <a href="https://www.youtube.com/user/JustThinkProperty" target="_blank">Oz Real Estate.TV</a> and a presenter for <a href="https://propertyinvestingvault.com/" target="_blank">propertyinvestingvault.com</a>.
</body></html>

Underquoting or industry ignorance - it can only be one or the other: Edwin Almeida

<html><body>
If the topic of underquoting and misleading advertising wasn’t so serious, the <a href="/expert-insights/buying/smart-gimmicky-1-blacktown-reserve-valentines-day-auction-sells-for-565-000">Valentines Day $1 auction campaign</a> would make a great comedy screenplay.
At a moment of reflection, I ponder which actors would suit the roles of the Premier calling for industry reform, or the CEO of the REINSW as well as the <a href="https://www.fairtrading.nsw.gov.au/ftw/About_us/News_and_events/Media_releases/2015_media_releases/20150315_sydney_agents_to_face_claims.page" target="_blank">agents facing allegations of underquoting</a>.
It’s time I believe we unravel the possible motives behind the Valentines Day $1 auction. Was it worth the trouble and who paid the ultimate price?
As I discuss the outcome of the auction with industry groups, we feel that there are now more questions than answers. These are questions that are now being asked of the real estate industry (REI) as a whole now that the dust has finally settled.
<h3>The facts as we see it</h3>
<ul>
<li>First marketing campaign: Sale by private treaty</li>
</ul>
 
<img src="/images/2015/03/25/230_blacktown_sale-by-private-treaty-offers-above570K-copy.jpg" alt="">
Source: CoreLogic RP Data
On or about November-December 2014, the home was advertised as "private treaty sale” for offers over $560,000, to offers over $570,000.
The records procured from CoreLogic are significant. At the very least, these records, I feel, evidence the real price sought by the vendor and the agent. It may also assist, to help clarify their true intentions. Other sites tell the same story.
Information provided above, also obtained from another free to access website. A site property buyers should frequent: onthehouse.com.au. The graph shows the advertising pattern of the property's marketing campaign.
<ul>
<li>New campaign: Sale by auction $1 reserve</li>
</ul>
<img src="/images/2015/03/25/onthehouse_notice-of-sale-and-advertising.jpg" alt="">
<a href="https://www.domain.com.au/property/sold/house/nsw/blacktown/?adid=2011564208&amp;sp=1" target="_blank">A new campaign, and a newly devised strategy, is concocted</a> to create interest among the general public and the media. On this note, I take my hat off to the parties; a strategy that didn’t even "personally offend" the CEO of the REINSW.
<img src="/images/2015/03/25/valentines-day-auction-tim-McGibbin.jpg" alt="">
However, a strategy that only served one purpose, to lure a crowd of potential bidders that were never going to get a bargain. Buyers that invested time and money and made an emotional investment, under the belief that they would get a bargain.
<ul>
<li>
The outcome: <a href="https://www.domain.com.au/property/sold/house/nsw/blacktown/?adid=2011564208&amp;sp=1" target="_blank" style="font-size: 12.1599998474121px; line-height: 1.3em;">Sold at auction $565,000</a>
</li>
</ul>
The property sells for $565,000. Bring out the marching band, drums and all. The vendor and the agent can now get some sleep and stop biting their nails.
Meanwhile, on the other side of the fence, innocent buyers walk away with greater cynicism about the REI. This is on top of walking away with a financial hole in their wallets, one to match their unchanged perceptions of the REI.
"Hey! You weren’t going to buy it for '$2 bucks mate', stop your whinging," is the taunt from the industry, while the agents and auctioneers beat their chests after so-called achievements of 20%-30% prices above reserves throughout Sydney.
On the contrary , I personally encourage you to keep complaining about what just happened. You got ripped off, conned and all recorded on National TV, to remind you in future. There should be an entrenched pathway already, leading to the Premier's office, to voice your complaints.
You took the time and organised; pest and building inspections, sought legal advice and invested time and emotion. All this on the belief a bargain was to be had.
After all, you’re a reasonable person and all you expected was a reasonable chance, a fair crack of the whip. Like the magic cures and elixir sales of yesteryears, all you got was conned.
Who will repay you for time lost and money spent? Well, you did perhaps get to see your face on national TV. Perhaps, both the agent and vendor think this is good enough?
<ul>
<li>Cost to the industry:</li>
</ul>
I don’t believe there will be a substantive cost to the REI at all. Here's why:
First reason: <a href="https://www.dailytelegraph.com.au/news/nsw/premier-mike-baird-pledges-crackdown-on-real-estate-agents-who-underquote-no-fines-issued-since-2004/story-fni0cx12-1227251897133" target="_blank" style="font-size: 12.1599998474121px; line-height: 1.3em;">No auction campaign that stoops into under-quoting has been prosecuted in the last 10 years</a>. It's become a free for all. The agents get paid their commission regardless, the vendors get to see a crowd being spurred on by emotion. Happy days for the REI.
Second reason:
<ul>
<li>Will you personally sell your own home now, and not use an agent?</li>
<li>Will you now terminate the agency agreements with the current agents that are selling your home?</li>
<li>Will you stop attending auctions?</li>
<li>Most of all, will you stop looking to buy?</li>
</ul>
I can say with all confidence, no you won't. Therefore, there is no cost that will hurt the REI as much as it will hurt you.
<ul>
<li>Cost to the Real Estate Agent:</li>
</ul>
Apart from further sleepless nights now that Fair Trading NSW is on the war path, the thought of being investigated and the thought of not keeping the commission may be all that is lost for now.
Perhaps more sleepless nights will become pertinent, should Mr Baird step in and make his words felt and act on the deception and misrepresentation. Direct action that should stem from industry conduct that cost the public dearly. Shameful conduct, to warrant clawing back the commission earned at the expense of many innocent buyers that attended the $1 auction.
<ul>
<li>Cost to the vendor:</li>
</ul>
A bit of time, a little more vendor paid advertising perhaps? Unfortunately time wasted may be all the vendor loses at this point.
Hopefully, the vendor too is losing sleep after misleading the public with this fiasco of a campaign. Or will he?
Well, maybe and one can only hope as it may be a fitful ending to the comedy screenplay, should the agent end his dialog with: <a href="https://news.domain.com.au/domain/real-estate-news/underquoting-real-estate-agents-have-nowhere-to-hide-if-they-break-the-law-20150316-1m0amu" target="_blank">“the vendor made me do it”, as the agent faces the Tribunal</a>.
A further token reward, would be for the vendor to face the Tribunal and be fined. We can only once again corss our fingers and see.
Should we hold our breath? <a href="https://www5.austlii.edu.au/au/legis/nsw/consol_reg/psabar2014476/sch1" target="_blank">Will the law be enforced? </a>
<ul>
<li>What can we learn from this?</li>
</ul>
Many agents and the general public are not aware that just about everything in relation to property is stored. From advertising to sales figures and even as far as mortgage holder's records. It is collected, collated and stored for various reasons.
Property valuers use the stored information to set their estimates. Banking institutions and government bodies use this information for research and other purposes to suit their needs. Yes, we the REI use these figures to compare prices and check sales history and put together market appraisals.
With some websites, we incur charges to obtain more information than what the general public sees. Others sites like, onthehouse.com.au also have good insights, and for free, but this information may take time to source. However, the paid for sites will deliver information at a glance.
Unfortunately, the governing and licencing bodies, such as Fair Trading NSW, are just understaffed and overworked already and lack the resources to research all the sales as we do. Our estimate is that there are 23,000 registered selling REAs in NSW. To police most of the transactions will be a monumental task.
If the Premier wants to get serious about his promises in this area, he needs to look closely at the root issue of Fair Trading NSW being understaffed.
Now there are lies and there are real estate auction campaigns. Some would say both are the same, just packaged in different wrapping.
I can only sit back and wait for some of my peers to try and convince me otherwise.
EDWIN ALMEIDA is licensee in charge of <a href="https://www.just-thin.com.au/" target="_blank">Just Think Real Estate</a>.<a href="https://www.just-thin.com.au/"> </a>
He is also the creator of <a href="https://www.youtube.com/user/JustThinkProperty" target="_blank">Oz Real Estate.TV</a> and a presenter for <a href="https://propertyinvestingvault.com/" target="_blank">propertyinvestingvault.com</a>.
</body></html>

Lies and real estate auction campaigns: Edwin Almeida

<html><body>
“Price it low, watch it go” is another real estate industry (REI) mantra. It's a saying that is more prevalent among real estate agents (REA) that heavily promote auction campaigns. 
And it's a mantra that is more damaging than the one I wrote about before: <a href="https://www.edwinalmeida.com/blog/real-estate-buyers-are-liars-vendors-are-cheats" target="_blank" style="font-size: 12.1599998474121px; line-height: 1.3em;">“buyers are liars and vendors are cheats”</a>.
For years now, I have been very vocal about "underquoting" with respect to the damage and aftermath it causes among well-intending buyers. Damages and costs are being borne by purchasers in the form of emotional expenditure and financial burden.
Yet agents and auctioneers are well aware, some are even well entrenched, in the seemingly unlawful use of deceptive and tactical advertising to draw a bigger crowd. <a href="https://www.linkedin.com/pulse/lie-lies-real-estate-property-auction-campaigns-edwin-almeida" target="_blank">This illusion and make-believe</a>, created by the REA’s to convince buyers the property will sell at a low price.
A crowd drawn by the notion of low pricing, creates in the potential buyers mind, a greater sense of urgency. A belief of missing out if they don’t attend and bid. Consequently, the fear of missing out and the competition on the day spurs on emotional bidding, rather than rational common sense, placing people in financial over commitment.
The industry makes admissions, why not listen?
I have had a few chats over coffee with my peers, both REA’s and auctioneers, and I can categorically and emphatically say my peers have admitted that this practise goes on and the affect it has on buyers is well known. In fact both camps will go as far as saying that it is wrong, but simultaneously, question my reasoning and my hard line stand on this topic. Yet, in public view, the REI seems to believe it is “squeaky-clean”. A thought perhaps <a href="https://news.domain.com.au/domain/real-estate-news/agent-underquoting-in-government-crosshairs-20140426-37ax9" target="_blank">far removed from John McGraths mind?</a>
I have been accused of not playing the game, “bagging the industry that pays me” and even as far as turning my back on the industry. Why? All because, when rogue auctioneers and REAs beat their chests in glory for achieving 20 to 25% over the reserve, I question their initial price guides given to the buyers. Price guides that were well below their figures achieved on the day. Once you add the true difference, the figures show more of a 30% separation from values given (i.e. price guides), to those actually achieved on the day of the auction.
I hope for the sake of the REI, <a href="https://www.dailytelegraph.com.au/news/nsw/premier-mike-baird-pledges-crackdown-on-real-estate-agents-who-underquote-no-fines-issued-since-2004/story-fni0cx12-1227251897133" target="_blank">Mr Baird’s campaign to address this cancerous practice of underquoting</a> isn’t a political stunt. I hope it doesn’t fizzle in the desert of forgotten political promises like the one in our sister state of Victoria.
Where are the heavyweights - Where are our guardians? 
In all this, where are the so called heavyweights - the guardians of the REI both in NSW and Victoria? It appears that one of the institute bodies has become mute on the subject matter altogether. Particularly after its long support of <a href="https://news.domain.com.au/domain/real-estate-news/reiv-forced-by-members-to-address-political-involvement-20150310-13zrc7" target="_blank">political campaigning in Victoria</a>.
Perhaps, both the REIV and REINSW are more entertained with the notion and ambition of their pursuits in politics than they are in the dubious and borderline behaviour of its members. Or is their lack of action stemming from fear of losing membership support? Clean up the membership base; I’ll remain a member and so will the majority.
Ironically, <a href="https://www.reinsw.com.au/imis15_prod/web/Posts/Promoted_Latest_News/REINSW_CEO_explains_reason_behind_real_estate_political_party.aspx" target="_blank">Tim McKibbin’s explanation of the reasons behind the REINSW’s political pursuits</a> has some of the merit required to introduce positive changes to the REI. Changes that will only begin when the REINSW cleans out its own house before trying to sweep the streets.
Here are some suggestions to creating notable policy for the political branch the REI NSW desires:
<ul>
<li>Deregister from REINSW membership; agents and agencies that are practicing underquoting. 
</li>
<li>Push for the introduction of pest and building inspection reports to form part of the contract of sale. 
</li>
<li>Push for the introduction of independent valuations to form part of the contracts of sale.</li>
</ul>
What will it take for the awful taste underquoting leaves in buyers' mouths to be controlled and eradicated once and for all?
Most definitely, the answer is not going down the path of the REI's being converted into political parties. We can only wait and see if the REIQ got it right.
For more property discussions join me on Twitter <a href="https://twitter.com/justthink1" target="_blank">@justthink1</a>and you can contact me on <a href="https://www.edwinalmeida.com/" target="_blank">edwinalmeida.com</a>. 
EDWIN ALMEIDA is licensee in charge of <a href="https://www.just-thin.com.au/" target="_blank">Just Think Real Estate</a>.<a href="https://www.just-thin.com.au/"> </a>
He is also the creator of <a href="https://www.youtube.com/user/JustThinkProperty" target="_blank">Oz Real Estate.TV</a> and a presenter for <a href="https://propertyinvestingvault.com/" target="_blank">propertyinvestingvault.com</a>.
</body></html>

What will it take to eradicate underquoting for good? Edwin Almeida

<html><body>
As previously written under the article, '<a href="/expert-insights/the-property-investment-pandemic-how-to-avoid-spruikers-and-bad-advice">The property investment pandemic</a>', easy money is not the answer to affordable housing.
My view on this topic has not changed. All I see is the same pomposity from our leaders, just in a different package.
The notions proposed by our political parties; firstly, advocating <a href="https://www.smh.com.au/federal-politics/political-news/joe-hockey-flags-opening-up-super-funds-for-houses-job-training-20150307-13xwz1" target="_blank">use of super funds</a> to pay for the deposit and/or secondly, <a href="/expert-insights/investing/nsw-labor-promises-staggered-stamp-duty-for-first-home-buyers">staggered stamp duty payments</a>, is not the answer.
Easy money, contrary to popular belief, does not make housing affordable or cheaper to purchase. Utilising super funds for purposes of deposits on homes will not work. An opinion supported by the "super fund" fiasco created in Canada. It is a toxic idea at the very least.
Home grants passed on by the state governments and other government or non-government incentives only fuel home values. Perhaps many are of the opinion that developers, builders and home owners looking to sell and don’t listen to the news because they are too busy building and preparing?
Allow me to burst your bubble. Any easy money given out makes the property owner, developer and builders grin with inner most joy, as they can increase the value of the end property product by double that which is granted.
I can just see property owners rubbing their hands as they wait for one of the above incentives to be introduced.
If the government is serious about housing affordability they should look into the taxes and duties payable by developer/builders that are passed on to the consumer. Duties and taxes collected by all levels of government at the same time were fees that were meant to be abolished with the introduction of the GST.
Then there is my pet hate: over-inflated commissions.
Commissions paid to spruikers and financial institutions that sell real estate with no licences. Excessive fees that are added onto the property values, predominantly on newly built homes. This is an area which the governing bodies should look into if they want to get serious about affordability.
There is light at the end of the tunnel however in the form of the oversupply of property presently being built in Sydney. This may well be a welcomed relief to Sydney’s local first home buyers. I am one to believe, other property markets will soon be oversaturated as well.
No, easy money is not the answer. I have some friendly advice to the people wanting to enter the market in Sydney as first home buyers: wait. Wait and rent for now, it is becoming so much cheaper to rent where you would otherwise buy. Wait for the market to catch up.
For more property discussions join me on Twitter <a href="https://twitter.com/justthink1" target="_blank">@justthink1</a> and you can contact me on <a href="https://www.edwinalmeida.com/" target="_blank">edwinalmeida.com</a>. 
EDWIN ALMEIDA is licensee in charge of <a href="https://www.just-thin.com.au/" target="_blank">Just Think Real Estate</a>.<a href="https://www.just-thin.com.au/"> </a>
He is also the creator of <a href="https://www.youtube.com/user/JustThinkProperty" target="_blank">Oz Real Estate.TV</a> and a presenter for <a href="https://propertyinvestingvault.com/" target="_blank">propertyinvestingvault.com</a>.
</body></html>

Easy money is not the answer to housing affordability: Edwin Almeida

<html><body>
The first lesson I was taught by our real estate office licensee, when I was first inducted was: "buyers are liars and vendors are cheats". A mantra, which may still be chanted in the offices of many agencies.
After the events of Saturday's "<a href="/expert-insights/buying/smart-gimmicky-1-blacktown-reserve-valentines-day-auction-sells-for-565-000">Valentines Day Auction" campaign</a>, a campaign that presented a property with a $1 (dollar) reserve, my first lesson came to mind. It is a lesson that echoed in our real estate office at the time. Our licensee in charge, would hum, sing and yell out loud; “buyers are liars and vendors are cheats”.
As for my position, noted and voiced in a recent industry debate held in North Sydney, I hold strong to the belief that buyers are not liars but are guided by the professional real estate agents (REAs).
As a matter of fact, I believe that buyers are cautious, confident and confused. Cautious, because for some, it is a first time experience. Confident, as other buyers have the experience and know how to play the game. Confused, may be attributed to the majority of buyers and all because of the plethora of misleading and deceptive advertising and marketing campaigns published.
Buyers in fact I believe, act on information given by the REAs. Likewise, vendors are also guided by the REAs. After all, it is the REAs reputation and licence that is placed on the chopping block, if there is any breach of the regulations.
In the case of the Valentines Day auction, the professional is the real estate agent selling the home. A person with the same duty of care to, and under law, to advice the vendor and hold firmly to stipulated regulations governing our industry.
So who is trying to fool whom? Who is the liar and the cheat, exactly?
In all seriousness, do agents and agencies truly believe the premise that buyers are in fact liars? As incredulous as it sounds, some REAs apparently still do. Some even approach their day to day work with this notion in mind.
Do REAs also consider vendors to be cheats? Well, it is after all the duty of the agent to guide through what may well be pitfalls in cowboy styled advertising and disclose any material fact.
However, based on the Valentines Day auction campaign; would it be a fair call, to say that some agents hold little regard for the general public? Perhaps, they hold less regard of their licenses and their duty. A duty of care, to buyers and vendors, under the industry licence.
Now place yourself in the position of being a buyer of real estate/properties, or a seller of real estate/properties. Basically, you are being considered a liar and or a cheat by the real estate industry. Isn’t this a sweet cup of coffee? The beans have been scorched; the taste is bitter as that grumpy old relative in every family. To date, the mantra puzzles me and I hope it puzzles you as well. Next time you approach a REA, do consider the following before engaging their services, as these are handy tips to best judge what and how an agent can benefit you.
<ul>
<li>Other than a low fee, what else does an agent bring to the table to assist you with attaining the best price to your home?</li>
<li>Is the agent-agency promoting one form of sale only and if so, do ask, why?</li>
<li>If the agent-agency believes so much on a 'specific marketing campaign', will they be prepared to shoulder the bill?</li>
<li>Always ask for trust account receipts when being asked to contribute to 'vendor paid advertising'.</li>
</ul>
If you are approaching a REA as a buyer, then keep these points in mind.
<ol start="1">
<li>Place any offer you want to give, in writing and ask for a written response.</li>
<li>When you are given a price guide, ask the agent to substantiate the guide given.</li>
<li>Don’t fully rely on the REA’s information. Do your own research and if required call on the services of other professionals. Valuers, buyers advocates and pest and building inspectors are a few that come to mind.</li>
<li>Remember that the REA believes you are a cheat, therefore, play the game and stay one step ahead.</li>
</ol>
EDWIN ALMEIDA is licensee in charge of <a href="https://www.just-thin.com.au/" target="_blank">Just Think Real Estate</a>.<a href="https://www.just-thin.com.au/"> </a>
He is also the creator of <a href="https://www.youtube.com/user/JustThinkProperty" target="_blank">Oz Real Estate.TV</a> and a presenter for <a href="https://propertyinvestingvault.com/" target="_blank">propertyinvestingvault.com</a>.
</body></html>

Do agents really believe "buyers are liars and vendors are cheats"? Edwin Almeida

<html><body>
GUEST OBSERVATION
When we think about building inspection reports (BIR), we often refer to a report that is conducted and only relevant to older homes.
Older homes are sometimes referred to as secondary stock (SS), dwellings that have been up for more than just a few years.  I believe it’s time to rethink a critical part of the property purchasing strategy in general.
In light of current construction trends and more to the point, the emergence of fly-by-night builder and developers; it is prudent that a purchaser obtains a professional pest and building inspection report (PBIR).
The following points could save you tens of thousands of dollars.
<ul>
<li>Just because it is “new and shiny” does not mean that it was well built</li>
</ul>
The relaxed building codes, <a href="/expert-insights/is-a-storm-brewing-over-sydney-s-construction-and-development">as previously reported</a>, when coupled with bad workmanship, adds to the inferior quality of finished construction. The following is a summary of a building report conducted of a townhouse development in the Sydney suburb of <a href="/news">Homebush</a>, where the town house values reached $950,000.
The inspection report identified over 100 defects. Again, I point out that the home being inspected was newly constructed. The report was a building report carried out as a “pre-settlement report”.  
The background of the complex itself highlights some very interesting information. The development company is a newly established company. The majority of the sales in the complex were made to overseas investors that had not seen the property to date, and were relying on their “buyers agents/advocates”, to guide them on their purchase.
I spoke to the building inspector and asked about the person he represented. The purchaser was a local resident that wanted to buy something new, and in this particular location. He bought early in the piece and due to being local, felt he could keep an eye on the progress of the development.
Much to his surprise, as the development progressed and he had the opportunity to talk to the trades-people on site and the builder, he became more and more dismayed with their building practices. Although being a novice, he was able to see and talk to some of the tradespeople on site who raised several concerns.
Now nearing settlement, and not convinced of the quality of construction, the purchaser decided to engage “David” to conduct a pre-settlement or hand over inspection report. The report showed over 100 defects.
When the developer was questioned on these issues, the response via the selling agent was words to the effect: “If he doesn’t wish to settle, he can have his deposit… we have other buyers interested in the property.”
<ul>
<li>Where to from here?</li>
</ul>
It will not be a surprise for similar stories to arise over the next six to 12 months. The three main reasons for the rise in shoddy construction I see are: fly-by-night property developers, the building codes not keeping up with the strong rise in urban development and the use of new materials and building methods not being properly tested by the course of time.
However, regardless of how you and I view the deficiencies and raise concerns through legal avenues and consumer rights, whilst the property market remains as hot as it was in 2014, our voices will pale in comparison to the noise generated by the current appetite for new development in Sydney where the higher influence is the foreign dollar.
It is however shameful that what was recognised as one of the best and toughest building standards in the world which Australia had, is diminishing in stature. Perhaps it’s time that the relevant authorities conducted more spot checks, as opposed to purely relying on private certification.
<ul>
<li>Take action don’t rely on preconceived notions</li>
</ul>
It is, however, important to take personal action when accepting a new property once completed. Don’t be persuaded by the agent nor the vendor that you don’t need a building inspection just because it is new.
Do not be persuaded by the selling agents or marketing companies that tell you that the ongoing remedy for building issues will be taken care by the owner’s corporation (OC). At the end of the day, even this argument is flawed; you are part of the OC so you will pay for it in part.
Common areas may be less burdensome to fix as all owners chip in, but ultimately defects in your lot (property/unit) will not necessarily be taken care by the OC. You may have to bear the entire costs of repairs.
Once you accept the property, it is harder to enforce any legal obligations on the builder to rectify any substandard workmanship, specifically to the inside of your unit/townhouse. You have limitations of time to have issues fixed internally and can you just imagine having trades people trampling through your home day in, day out after you just spent a million dollars to buy a new property?
Some may say “better the devil you know”; this is true in construction when buying into highrise apartment blocks that have had ample time to settle and the major issues dealt with.
However, we should not be punished if we ourselves make a decision to buy a new home. To better safeguard yourselves in the purchase, appoint a property lawyer to act for you in regards to the conveyancing.
I am one to believe that developers and builders fear lawyers more than do conveyancers, when dealing with off the plan purchases and newly built property. This will assist in hedging the likelihood of being misled by a developer and safeguard you against major investing regrets, the purchase ‘hangover-regrets’ that tends to keep people awake at night.
EDWIN ALMEIDA is licensee in charge of <a href="https://www.just-thin.com.au/" target="_blank">Just Think Real Estate</a>.<a href="https://www.just-thin.com.au/"> </a>
He is also the creator of <a href="https://www.youtube.com/user/JustThinkProperty" target="_blank">Oz Real Estate.TV</a> and a presenter for <a href="https://propertyinvestingvault.com/" target="_blank">propertyinvestingvault.com</a>.
</body></html>

How a building inspection report could save you tens of thousands of dollars: Edwin Almeida

Perth’s new apartment market recorded its strongest quarter of sales since Q4 2021, with 412 apartments sold in Q1 2026 and a record quarterly sold value of $537 million, according to Urbis’ latest Apartment Essentials results.

Urbis said the March quarter result reflects strong, highly product‑specific demand across both ends of the market, from more attainable projects delivering at scale, through to premium stock being absorbed by equity‑rich downsizers.&nbsp;

David Cresp, Partner at Urbis, said the key story in Perth is not demand, it is the market’s ability to convert demand into delivered housing.&nbsp;

“This is the strongest sales quarter since Q4 2021, and it reinforces that demand in Perth is real and it’s local,” David Cresp said. “But the task now is delivery, turning that demand into projects that can actually be built and completed.”&nbsp;

[smartcode_project:default project_id=110291 project_image_fid=302785]

<h2>Affordable product leads, premium demand remains resilient</h2>

Sales in Q1 were led by more affordable projects, with The Boulevard (SKS Group) recording 115 sales in the quarter, the presentation noting this is only the second time a single project has surpassed 100 quarterly sales. The project was able to offer more affordable housing product right next to a train station.&nbsp;

Palmyra West (Finbar) also delivered strong results with 28 sales in Q1, following 84 sales in Q4, with an average price of under $800,000, underscoring depth of demand for well‑located, attainable new stock.&nbsp;

At the premium end, Urbis said downsizer demand is continuing, with the results highlighting Romeo (Applecross, Finbar) recording 75 sales and reaching almost 50% sold in one quarter.

Jual (Shenton Park, Celsius Property) also posted a strong quarter with 28 sales, reaching 39% sold in one quarter.

Urbis noted that Perth apartment demand is not speculative, not investor‑led, and not uniform, describing it as localised, often equity‑driven and highly product‑specific, a pattern reflected in the polarisation between strong “attainable” performers and premium downsizer product.&nbsp;

[smartcode_project:default project_id=148957 project_image_fid=364102]

<h2>Prices underpinned by costs, and the delivery risk is growing</h2>

Urbis said pricing pressure is cost not demand‑driven: construction costs and delivery risk are now a central constraint, with the results noting build costs remain elevated and volatile, and that energy, fuel and labour uncertainty weigh on feasibility.

David Cresp said a growing challenge for private Build‑to‑Sell developers is simply securing a builder in the current environment.

“Developers are really feeling the pressure from a building market that was operating at capacity and securing a builder is challenging,” David Cresp said, adding that even where a builder can be secured, “trying to get to the price that makes the development financially viable is incredibly challenging in the current market.”&nbsp;

Urbis’ broader WA commentary also notes that industry remains at or above capacity with lot and housing creation, and that many builders are limiting new sales to manage stretched workforces and fixed‑price contract pressures, conditions that flow directly into apartment feasibility and delivery timing.

[smartcode_project:default project_id=108869 project_image_fid=317905]

<h2>Supply: improving later, but still constrained, and Perth lags eastern benchmarks</h2>

While near‑term supply remains constrained, Urbis’ forecast shows completions lifting “Supply is forecast to be back above 1,500 apartments per annum for the first time since 2019”, with 1,775 completions forecast for 2026, and volumes remaining above that level over the following years.&nbsp;

Looking further ahead, completions are forecast to reach 2,500 in 2028, with the report noting 32% of that total is social/affordable, reflecting the role of government‑supported delivery in rebuilding the pipeline.&nbsp;

However, Urbis said Perth remains behind comparable markets on pipeline scale. In a national comparison of projects under construction, the report shows under construction Perth Build‑to‑Sell (BTS) at 3,446 apartments versus the Gold Coast at 7,922. Mr Cresp said “The challenge for Perth is how to we grow the delivery pipeline”.

Urbis’ conclusion is that Perth’s market is increasingly defined by product discipline and delivery certainty, with the research identifying “delivery certainty is key” and calling out builder risk and procurement models as core success factors, alongside “timing and staging”.&nbsp;

Joel Robinson

Perth apartment sales hit strongest pace since late 2021 as builder capacity tightens

<a href="https://www.apartments.com.au/developers/sammut-developments">Sammut Group</a> has secured development approval for its latest Brisbane apartment project, marking the Sydney developer’s next step in expanding its Queensland pipeline following the success of its debut Gold Coast development, Coast.

The approved project at <a href="https://www.apartments.com.au/new-apartments/44-glen-road-toowong-qld-4066">44 Glen Road, </a><a href="https://www.apartments.com.au/developments/toowong-qld-4066">Toowong</a> will deliver a 15-storey riverfront apartment building with 42 residences, significantly increasing the scale of the site’s previous approval for a smaller luxury scheme. Designed by Bureau^proberts, the development will comprise a mix of predominantly four-bedroom and two-bedroom apartments positioned to maximise Brisbane River and city views.

Sammut Director Julian Sammut said the group had been actively searching Brisbane for several years before identifying Toowong as the right fit.

“Brisbane was the right step for Sammut,” Sammut said.

“With the success of Coast we thought we should definitely look to do more in Queensland alone. We then pushed up to look at Brisbane. We've been looking for I'd say two to three years actually and it was hard to find the right location.”

<img alt="Sammut makes Brisbane apartment play" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/f_auto,c_limit,w_1440,q_75/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/field/image/Screenshot%202025-12-23%20at%203.27.14%E2%80%AFPM.png?VersionId=dYAVIL7qdcGA8ojvkslSrLjczXFejSSx" />

Sammut said suburbs including New Farm and Teneriffe were considered before the group ultimately focused on Toowong due to its strong downsizer demographic and limited supply of developable riverfront land.

The site was acquired off-market after what Sammut described as a lengthy negotiation and planning process, with the developer pursuing an uplift to the original approval.

“We are DA approved now which is very exciting,” Sammut said.

“We've had our change approval come through and we've obviously doubled the height, 15 storeys plus rooftop. We've got 42 amazing apartments that are going to be coming to market soon.”

<img alt="Sammut makes Brisbane apartment play" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,dpr_2.0,q_auto:good/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202025-12-23%20at%203.27.26%E2%80%AFPM.png?VersionId=ohkRkY0dIZlqdfME2EZePsCQavRiBadE" />

Bureau^proberts said the design responds to Toowong’s evolving urban character, balancing contemporary apartment living with the area’s established residential identity.

“A place where traditional Queensland living has taken place for centuries; Toowong is seeing a shift of contemporary influence, commercial and retail hubs mixed with well-considered residential offerings – all the while maintaining its character and charm,” the architect noted in planning documents submitted to Brisbane City Council.

The architecture practice said the project’s form was shaped by its riverfront setting, flood considerations, neighbouring building scales, and view corridors.

“They said the mix of four and two-bedroom apartments capture the ‘fundamental qualities of Queenslander living,’ translated into the context of a contemporary subtropical building.”

The development sits just off Coronation Drive within walking distance of Toowong’s retail precinct and the upgraded Regatta ferry terminal, while also benefiting from proximity to the incoming green bridge connection to West End. Sammut said the accessibility and amenity offering were central to the site’s appeal.

The approval adds to growing residential activity along the Toowong riverfront, joining nearby projects including Consolidated Properties’ Monarch Residences and Spyre Group’s ARC Residences.

Sammut secures approval for debut Brisbane apartment development in Toowong

Developer Lanevick is heading back into Sydney’s apartment market after focusing more heavily on the luxury townhouse and terrace sector in recent years.

Lanevick, founded and directed by Steve Maroun, is expecting to receive approval in the coming months for a new apartment development in Gladesville, with the aim to launch it to the market later this year.

The 51-apartment project, designed by Studio Johnston, will comprise a mix of one-, two-, and three-bedroom apartments positioned toward the Hunters Hill downsizer market.

“Traditionally it’s been difficult for people in that market to downsize because there just hasn’t been the right product available,” Maroun said.

“We’re targeting buyers who might have 30 to 40 per cent of their house value sitting in the bank after downsizing.

“They still want good spacious entertaining areas, they still want quality design, but they also want flexibility and the ability to enjoy life a bit more after working hard for a long time.”

The project sits near Boronia Park and within close proximity to the Parramatta River foreshore, an area Maroun says offers more of a Hunters Hill lifestyle than a traditional apartment precinct.

“From a lifestyle perspective, it’s really more Hunters Hill than Gladesville,” Maroun said. “You’re close to the foreshore, close to parklands, and still connected back into the village precinct.”

From level four and above, apartments will capture water views&nbsp;toward Sydney Harbour. Communal amenity will include rooftop entertaining areas, wellness spaces, and a gym tailored toward owner-occupier buyers.

“We’ve really designed these apartments around that buyer coming from the Hunters Hill LGA and what they’re actually looking for in their next chapter.”

The proposed development has also been designed to respond to the changing character of the broader Gladesville town centre, where a growing number of mixed-use and residential proposals are expected to emerge over the coming years.

“Gladesville presented a rare opportunity to deliver a genuinely design-led residential project within an evolving lifestyle precinct, just moments from the growing Gladesville town centre, and we’ve approached the project with a strong focus on architecture, liveability and long-term community value,” Maroun said.

Maroun said Lanevick saw a first-mover advantage within the precinct as planning controls continue to evolve to accommodate greater housing density.

“We think there’s a real opportunity there that hasn’t really been serviced properly yet,” he said.

“There’s going to be a broader evolution of the whole Gladesville village precinct over time, particularly with more activation and mixed-use outcomes.”

The Venus Street proposal will include a commercial and retail component at ground level designed to contribute to that evolving streetscape activation.

“A big part of the thinking was how do you activate that area properly and create more vibrancy and amenity, which is what Hunters Hill has been looking for,” Maroun said.

Lanevick’s focus since 2020 has largely been on smaller-scale luxury townhouse and terrace developments. The developer recently completed Royale Randwick, also designed by Studio Johnston, where prices reached $3.65 million. The project was featured in the UDIA NSW 2026 Professional Development Prospectus and was also named a finalist for Development of the Year.

&nbsp;

Lanevick to cater for Hunters Hill downsizers with new Gladesville apartment development

Property developer One Living, backed by former Macquarie banker turned investment manager Chris Green’s investment firm, has unveiled plans to bring more institutional capital into housing to help address the national supply crisis.

The New York-based investor has focused his firm, GreenPoint Partners, on addressing the supply shortage hitting middle market housing in Australia.

It is backing the new One Living business to develop more than 1000 units along the eastern seaboard. The new firm is starting with a development on Mona Vale Road, on the border of Mona Vale and Pymble, in Sydney’s Northern Beaches, with around 140 apartments planned. They are eyeing off more sites across the city.

With cost pressures rising in the industry, One Living’s model is to be a vertically integrated developer-builder, so it can respond directly to the housing gap by removing the cost inefficiencies embedded in traditional residential delivery.

“We are building a platform designed to operate at scale and starting in a market where there’s a clear need for quality, attainable housing,” One Living joint managing director Joseph Scuderi said.

“It’s that missing middle – it’s that attainable end of housing… that’s what most Australians invest into and what Australians can actually afford.”

<img alt="Mona Vale" data-entity-type="file" data-entity-uuid="798dfa93-4941-4db6-a696-31e9dc18e81c" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-28%20at%202.31.50%E2%80%AFPM.png?VersionId=mKBqi5C_DmeiXS.AtJkcR8LQIxqCqmFi" />

GreenPoint Partners brings years of experience assembling and scaling real estate operating businesses across major markets. And Green sees a big opportunity in Australia.

“For its size, sophistication and importance to the community, Australia’s living sector has remained largely under-institutionalised, which represents significant opportunity,” Green said. “GreenPoint identified that gap, assembled the right team, and is backing One Living to build a platform that is aligned to market needs.”

Green said being a builder-developer would give the company the capacity and flexibility it required to deliver reasonably-priced homes.

“We want it to be at that attainable level; not super high end luxury but at that attainable level,” he said.

<img alt="Mona Vale" data-entity-type="file" data-entity-uuid="74a5344a-4b26-4d4a-ada3-056b1220be77" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-28%20at%202.32.15%E2%80%AFPM.png?VersionId=vY8hXHO4reBMdO8ZXMWCNtGZJofUPQ3j" />

&nbsp;

One Living will undertake a component of affordable housing in its schemes, which it will own and operate, and it could also run build-to-rent on some sites.

Green praised local policy settings.

“The NSW government is being very supportive, strategic and pragmatic in terms of how do we generate more supply of housing,” he said. “We think it’s actually positive for development and the bit that’s been lacking at that attainable level is that it’s lots of relatively small private developers, whereas we want to create an institutional platform.”

One Living is also&nbsp;looking at high-density projects and could take on more institutional funding in the future.

“The way we will be able to achieve economies of scale is through size,” Green added.

One Living enters Sydney's new apartment market with Northern Beaches site acquisition

It's been several years since there's been an opportunity to buy a brand new townhome in Melbourne's coastal suburb of Mordialloc. Even apartment developments in recent times have been few and far between in the area.

Local developer LDS Property identified the gap in new housing, securing a site on White Street, directly opposite&nbsp;Woodlands Golf Club Mordialloc. They've recently launched&nbsp;<a href="https://www.apartments.com.au/new-townhouses/wm-residences-mordialloc-102-white-street-mordialloc-vic-3195">WM Residences</a>, just 13 townhouses which they have already started building.

Projects by Buxton Director Heath Thompson, who is selling WM Residences, says the townhouses x that perfect middle ground be

"Mordialloc residents have had limited options to downsize within the suburb, often forcing them to look elsewhere despite long-standing ties to the area," Thompson says.

"With very little comparable new supply coming to market, projects like WM Residences are well placed, particularly as buyers look to capitalise on current conditions amid constrained supply."

[smartcode_project:default project_id=134646 project_image_fid=6109]

The development, designed by regarded architecture firm&nbsp;<a href="https://www.apartments.com.au/architects/ewert-leaf">Ewert Leaf</a>,&nbsp;adopts a deliberately restrained architectural approach, focusing on simplicity, durability and liveability rather than overt design gestures.

The boutique scale is central to the offering. With only 13 three-bedroom residences, each home is configured to prioritise functional layouts and everyday use, supported by private terraces and secure two-car garages.

Ewert Leaf’s design response leans into a calm, neutral material palette. Interiors are defined by oak flooring, white walls and soft finishes, creating a consistent and understated backdrop. The approach avoids trend-driven detailing in favour of longevity, with an emphasis on natural light and spatial clarity.

[smartcode_project:default project_id=134646 project_image_fid=6110]

Beyond aesthetics, the homes are designed to meet contemporary performance expectations. Each residence targets a minimum 6-star energy rating, incorporating double glazing, comprehensive insulation and all-electric Bosch appliances.

The project’s location supports a walkable coastal lifestyle, sitting within close proximity to Mordialloc’s foreshore, Main Street retail strip and the train station. Local cafés and dining venues, including Suburbia Deli and Hendriks Café, are within a short walk, reinforcing the area’s established neighbourhood character.

[smartcode_project:default project_id=134646 project_image_fid=6116]

While <a href="https://www.apartments.com.au/developments/mordialloc-vic-3195">Mordialloc</a> is often defined by its beach and pier, the project taps into other areas of day to day living, offering easy access to local food, casual dining and transport, rather than positioning itself purely as a lifestyle retreat.

WM Residences reflects a continued trend across Melbourne’s coastal suburbs towards smaller-scale, design-led townhouse developments, particularly on infill sites where proximity to amenity is already established.

With construction commenced prior to its market entry, the project aligns with a growing preference among buyers for developments with visible progress and defined delivery timeframes.

[smartcode_project_cta:default project_id=134646]

Edwin Almeida

Editor's Picks

Have something to contribute?

Developments

New apartments

New townhouses

News