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Buying a property is one of the biggest investment decisions you will ever make, so it’s important you get it right. Firstly, you must consider what you can afford. Once you have a budget in mind, you can assess your options and decide on which investment type will best suit your individual requirements – an apartment or a house? With the right knowledge and information at your disposal, you can more easily determine which type of property will give you greater capital growth and rental returns.
We are often asked whether a house or a unit/apartment will provide a better overall investment, especially in terms of wealth creation or early retirement goals. Our response to that is historically, houses have always outperformed units in terms of capital growth.
The old investment adage of “land appreciates, buildings depreciate” has held true. However, times are changing, and we’re now starting to see good capital growth levels with apartments.
Consider the following list of pros and cons for both property types to help make your purchase decision easier.
Pros of buying an apartment/unit
• Lower entry-level purchase prices 
There are many good-quality apartments around, for half the cost you would pay for a house. Getting started and saving for a deposit is more achievable and means you can own a property sooner rather than later.
• Low-maintenance living 
Fixing, repairing and general upkeep of a property can be a lot of hard work, especially if you are short on time and money. Apartments generally require less care and maintenance than a house, which makes it ideal for socially active professionals or baby boomers looking to downsize.
• Less expensive to renovate 
Polishing up an apartment with a coat of paint, changing door handles and installing new appliances can really help to sharpen the appeal of an apartment. This can often be achieved at minimal cost, saving you lots of money when compared to renovating a larger home.
• Higher rental returns 
Apartments usually generate a stronger rental yield than a house. The increased demand for apartment rentals will ensure good investor returns over the long term.
Cons to buying an apartment/unit
• High body corporate fees
Depending on the type of apartment you buy, the body corporate fees can sometimes be excessively high. Quarterly payments will often go towards maintaining shared facilities such as laundry, lifts, gymnasium, pool and outdoor entertainment areas.
• High-density living
Not everyone will share the same ideals or standards as your own; some apartments have thin walls and poor insulation, which can mean high noise levels and a general lack of privacy. In many ways, you are powerless to change your environment.
• Buying off the plan 
Modern apartments in high-density developments can often attract very slow capital growth. Resale is usually not that strong, with the land value worth less than 10% of the purchase price.
• Smaller living spaces 
If you are accustomed to more expansive living arrangements, this may present a problem. Some apartments can lack key storage space and can be difficult to navigate in freely.
 
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Pros to buying a house
• More potential for capital growth
The main reason most people buy into real estate is to make money. Houses generally have a larger land size value, which gives you greater flexibility and choice to develop, sub-divide and extend if required.
• More privacy and feeling of space
Communal space can never match the appeal of your own private garden. Houses are more generously proportioned offering you a greater sense of privacy and space. Young families can take advantage of larger outdoor areas with the added bonus of keeping as many pets as you want.
• Appeals to a larger cross-section of buyers 
You will never have a shortage of interested buyers with a house. Demand will be always be stronger if you can appeal to a diverse range of potential buyers such as first-home owners, investors and young families.
• No shared land/or owners’ corporation costs 
The good thing about a house is you have more control over what to spend your money on. Rather than being locked into paying quarterly levies, you ultimately get to decide on what needs to be fixed today, tomorrow or next month. The choice is yours.
Cons to buying a house
• Higher stamp duty and interest costs 
Owning your dream home requires much effort and financial consideration. Spending that little bit extra to have the home you really want can often mean higher stamp duty costs and loan interest fees.
• Higher maintenance and renovation costs
A house will always have higher structural and renovation costs such as plumbing and electrical work. If something unforseen occurs such as a roof leak or the hot water system breaks down, you are solely responsible for that. Not to mention the increased monthly expenses such as council rates and utility charges.
• Lower rental returns and reduced cashflow for investors
In general, properties with higher capital growth have lower rental returns. To increase the rental yield of a house, you would need to invest money on renovating or further developing it into a high-growth property.
• Fewer tax deductions and depreciation benefits for investors 
There are always eligible items that can be depreciated and go towards minimising your tax liability such as carpet and kitchen appliances. Newer homes tend to offer greater tax depreciation benefits rather than older, more established homes.
Frank Valentic is managing director of award-winning buyers' agency <a target="_blank" href="https://www.advantageproperty.com.au/">Advantage Property Consulting.</a>
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Is a house or an apartment a better investment?: Frank Valentic

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Owning a home has long been a dream for most Australians.  In recent years, the property squeeze has forced many potential buyers to look at other alternatives such as units and apartments. With people living busier lifestyles today, apartment living is proving to be a very popular option.
In fact, over a quarter of our population (27.3%) are now living in units and apartments.  More people are choosing to leave the quarter-acre suburban block behind that was popular in the 1990s and opting for the “lock-up-and-leave” advantages of an apartment.
Consider also the hundreds of thousands of immigrants moving here from Europe and Asia, with many of them also buying apartments. In these parts of the world, apartment living is the norm – generally because it is very affordable compared with buying a house. Low-maintenance living is the way of the future and in my opinion, is here to stay.
With the above information in mind, it would be remiss of me not to mention the flipside of apartment buying. To avoid purchasing a “lemon”, be prepared to do some homework, as it will save you lots of dollars and heartache in the long run.
Not all apartments will make profitable investments, mainly because some of them achieve minimal capital growth over the long term.  This is due to a multitude of factors and may include things such as: exorbitant body corporate fees that eat into your rental returns, buying in a low-growth location or simply buying in a bad position.
Our buyers’ agency has adopted a strict “investment-grade” criteria in helping over 2,000 buyers purchase apartments in the last 12 years.
So what are some of the advantages of apartment living?
•             Less repair work – An apartment will generally require far less maintenance and repair work than a house, which will always have more structural issues including plumbing, wiring, stumping, roofing and much more.
•             Minimal maintenance and general upkeep – Houses generally require more attention in terms of ongoing maintenance than that for apartments. There is no need to mow the lawn or do the gardening.  Leave this to body corporates. Enjoy more time to yourself on weekends to do the things you love.
•             Access to leisure facilities – Depending on what you buy, you might have access to communal leisure facilities such as swimming pools, gymnasiums, barbecue areas and bar/restaurants.
•             Higher investor returns – For investors, the returns are generally 1 to 2% higher than for houses.  This results in better cashflow and less money out of investor’s pockets.
 
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So how do you avoid buying a “lemon”?
Here are some of the things we look for that will make your next apartment purchase easier and more profitable.
1.            Scarcity value 
Ensure you buy an apartment in areas where the local council has strict height planning controls.  This will ensure you are not competing with thousands of new apartments each year.  If you look at areas like Elwood or St Kilda, height controls are generally restricted to four-level high buildings. This ultimately adds more scarcity value when compared to buying in Port Melbourne or South Melbourne, where new high-rise towers can shoot up like mushrooms every month.
2.            Land value
Apartments can still have “land value” if you buy in small boutique blocks of 10 or fewer. Make sure you are not one of 100 or more apartments, as this will substantially diminish your land-to-value ratio.  Remember, it is the land that appreciates and this will ultimately determine your property’s value and growth potential. Keep in mind, low-rise buildings where fewer units share the benefits of rising land values will increase in price faster than high-density developments. Therefore, buying an apartment in any high-rise building would be a costly mistake, as you would be compromising on land value and hence, future capital growth potential.
3.            Location
The three golden rules in real estate 101:  1.Location! 2.Location! 3.Location! Buyers should look for suburbs that have strong, positive attributes. If you get the location right, capital growth should follow. Look at buying an apartment that is walking distance (not car dependent) to cafes, schools, parks, water and transport, as this will supercharge your investment potential.  Add to this a quiet, wide, tree-lined street to further enhance the property’s value.
Check out the walk-score distance on walkscore.com to determine how close or far away you are from these popular amenities.  If it’s a score over 70, then you are more than likely too far to walk. Having said that, avoid “C-grade” locations such as main roads, train lines, close proximity to petrol stations and power lines, as this may have an adverse effect on the value of the property.
4.            Appealing aspect
If it has a negative view where you are looking straight into a brick wall, this will impact the growth potential of an apartment.  Any apartment with a park, city or water view will always have a broader market appeal and ultimately be in stronger demand.  Sometimes it’s better paying a 10% premium in price to get one with an appealing aspect or view.  Cheap apartments will always be just that:  cheap and inferior.  Go for upper-level apartments, as they generally have better views and superior aspects.
5.            Sunny orientation
If an apartment is not facing north or north-west, it more than likely attracts little sunlight. Apartment buyers tend to prefer bright, sunny and well-lit homes that require more energy-efficient and sustainable living arrangements, as this helps to save on growing electricity bills.
The next time you’re out apartment hunting, bring your compass along (or use it on your iPhone) and make sure the living areas are not facing the less preferred, dark southerly orientation.
 
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6.            Security
Buy apartments in complexes that offer full security features such as security gates, security doors and intercom systems. This is especially important for females living alone. Although ground-floor apartments have advantages of entertaining yards, upper-level apartments are more secure and harder to break into. Avoid suburbs and streets (eg: Grey Street, St Kilda) where security concerns will limit the numbers of interested tenants and future buyers for your property.
7.            Other amenities
Aim to buy an apartment that has supporting features such as car parking, an outdoor area or private laundry.  An ideal find would include things such as:  an apartment with a distinctive hallway entrance rather than walking straight into the lounge from the front door and a central bathroom as opposed to an en-suite bathroom, as you don’t want to be walking through a bedroom to get to it.  The preference also is to have a practical floor plan that allows for better living arrangements, such as: not having bedrooms running off living areas.  It also works to your advantage if your apartment is on the corner of the building with only one party wall.
8.            New vs old
As a general rule of thumb in real estate, stay away from buying “brand new”. It is not uncommon practice for the developer to load up the price by an extra 10% to cover the GST they would have to pay when constructing a brand new property.  Buyers are better off buying something that is one or two years old to avoid paying GST.  Keep in mind, brand-new properties are often sold at premium prices and can be “loaded up” if sold through marketing and promotional agencies.
The same goes with buying off the plan.  Even though you may save on stamp duty, you would still have the GST component to pay, which offsets this supposed saving.
9.            Wow factor or ‘twist’
Aim to buy an apartment “with a twist”, meaning, there needs to be a “wow factor” about the property that sets it apart from the tens of thousands of apartments in Melbourne.  This could be in the form of a courtyard, the size of the apartment or simply park or water views.  It needs to have a USP – a unique selling proposition that differentiates it from other similar properties. If it has the extra bells and whistles and generally ticks more boxes than other comparable properties, you will be well on your way to securing a great investment.
In summary, we would generally recommend buying older-style apartments that you can add value to via internal and external renovation. Remember: you can change an apartment’s characteristics but you can’t change its location or aspect, so aim to buy a property in the best street and the capital growth will follow.
Our buyers’ agency has purchased over 60 blocks of apartments in the last few years that we can “bulk-buy” and add instant value to with sub-divisions and external/internal renovations.
Frank Valentic is managing director of award-winning buyers' agency <a href="https://www.advantageproperty.com.au/" target="_blank">Advantage Property Consulting.</a><a href="https://www.advantageproperty.com.au/" target="_blank"> </a>
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How to avoid a 'lemon' when buying an investment apartment: Frank Valentic

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We’re all aware Melbourne is facing a shortage when it comes to affordable housing, especially if you have your heart set on buying within 20 kilometres of the CBD.  However, there are still some affordable hotspot suburbs that fall well below the average Melbourne median price and will make it easier to help secure your next property. From the outset, you need to know how much you can really afford to spend, as this will dictate the properties available to you.
At Advantage Property Consulting, we are regularly trying to locate hotspot suburbs and have assisted over 2,000 clients in achieving their dream of owning a property.
So what is a hotspot?
A hotspot can best be described as an area that has not attracted the same level of attention as traditional blue-chip locations. They are often identified as areas that are underperforming, usually within close proximity to more popular suburbs.  When an area becomes too expensive for people to afford, they usually move to these neighbouring suburbs that are more affordable, causing a positive outward ripple effect.
What are some important things to look for before buying into a hotspot area?
Pick a diamond in the rough Choose a well-positioned property that represents good buying value.  An unrenovated property can often be purchased under market value, offering the chance to improve and increase equity over time. If it is well supported by strong infrastructure and lifestyle amenities, then the chance of gaining a good investment return is higher.
Follow the ripple effect outward If you’ve been priced out of a more expensive inner-city suburb, look to its surrounding areas to try and pick up a bargain.
Choose an area with good quality stock/dwellings For example: buying a period-style apartment in a block of four versus buying an apartment in a high-rise precinct where you are the owner of one of 100 similar apartments. Period homes tend to fetch better prices and are in much higher demand than other property types.
Easy access to employment opportunities It is important to have easy access to a diverse range of employment opportunities near your property.  This will attract reliable tenants/investors to the area and offers better growth potential over the long term.
Look for areas with solid or expanding infrastructure Having good, reliable access to nearby arterial roads, highways and satellite cities will always add more value to a suburb.  Look out for planned developments in the area as well as new infrastructure improvements such as freeways, as this often indicates the area is on the up.
Don’t always go for the cheapest property Focus on what comparable properties are actually selling for in the area to figure out if a property is overpriced, has met the current market or is at under market value.
Focus on the property not the hotspot You are buying a property, not an entire suburb. The key is to identify potential for capital growth and rental returns. If it is well positioned, then the desirability factor increases.
Look for signs of the next “Williamstown or St Kilda” and trust your intuitio Look for a feeling or indicators that a suburb is on the move. Lifestyle features such as being close to the water, bars, restaurants and retail outlets will always add substantial money to your investment.  It is not unusual for unwanted locations to become hotspots over a 10- to 20-year period, so think long term.
With these key factors in mind, here are five potential “hotspots” in Melbourne worth taking a look at:
1. Thornbury
Thornbury has shown an impressive 21% growth per annum over the last 22 years.  Units and flats are still very affordable with an average median price of $432,000.  Located just seven kilometres north-east of the CBD, it has easy access to transport, an attractive lifestyle vibe and is very family friendly. The ripple effect from more expensive suburbs such as Northcote, Fitzroy and Carlton has caused Thornbury to become a more financially viable and affordable alternative. It has all the right features and qualities of a prime suburb, making this an ideal entry-level suburb for first-home buyers and investors.
2. Spotswood/Newport
Positioned just seven kilometres west of Melbourne’s CBD, both Spotswood and Newport have shown steady growth of 14% per annum growth over the last 22 years.  It is one of the few affordable inner-city suburbs left in Melbourne. Apartments and flats are still available well below the $535,000 median. It has very good transport connections to the CBD, with a new multi-line train station, nearby Westgate Freeway, Western Ring Road and City Link arterials. Neighbouring satellite city of Footscray is close by.  You can still find older-style cottages on good- sized blocks, proving popular with first-home buyers and investors.
The ripple effect from wealthier suburbs such as Williamstown and Yarraville has caused both Newport and Spotswood to become future hotspots.
3. Box Hill
The ripple effect from Camberwell and Surrey Hills has put Box Hill in a good affordability category. The median price for units and apartments is still relatively affordable at $467K.   Located 14km east of the CBD, it is a major commercial centre and transport hub.  It has excellent access to Maroondah Highway and is home to the local Box Hill Hospital.  In addition to all the wonderful amenities, it is also a growing satellite city with the local council introducing further relaxed planning controls to help promote and build medium density development.
4. South Yarra
The reason why we have chosen to include the inner “blue-chip” suburb of South Yarra is that prices have fallen considerably.  You can now buy one-bedroom apartments well under its median price of $620,000. This holds great appeal to those seeking an affordable entry in to a highly desirable location. Located just three kilometres south-east of the CBD, you can’t go wrong with the close proximity to trendy Chapel Street and Toorak Road.  Established infrastructure such as The Alfred Hospital and Swinburne University are also nearby.
5. Frankston
Located 41 kilometres south of the CBD, Frankston is slowly becoming a major commercial, retail, educational and transport centre. This satellite city will have the Peninsula Link opening in early 2013.  As a result, you will see travel time cut by up to 40 minutes between Carrum Downs and Safety Beach.  The median price for a home is super affordable at $350,000, and apartments can be purchased at less than  $270,000.  Close to the beach, the future development of a local marina will also add significant value to the area.  The ripple effect from neighbouring Mount Eliza and popular Mornington Peninsula suburbs (Portsea, Sorrento and Flinders) is offering potential buyers a much more affordable option.
In summary, you can still make money in a flat market.  Boom suburbs always happen for clear reasons, and picking one before it becomes popular, is one of the simplest and quickest ways to make money in real estate. In fact, if you remember the following winning formula –purchase at the right price, in the right place and at the right time, you will no doubt reap good financial rewards.
With this in mind, make sure you choose under-performing suburbs and stick to affordable areas under Melbourne’s median price.  Do your due diligence and research thoroughly before you buy.
What other strategies can you use to make money in the current flat property market?
Find distress sales Chase vendors who need to sell quickly due to divorce, finance issues and impending deadlines due to other purchases or commitments.
Buy wholesale, not retail For example: Buy a whole block of flats in a group syndicate and purchase in the $1 million to $6 million price range, as this will reduce your competition.
Add value with subdivisions Buy properties that need to be subdivided.  This will simultaneously increase the properties’ value instantly.
Add value with renovations Buy “ugly ducklings” that need internal and external renovations, as this will add instant value and equity.
 
Frank Valentic is managing director of <a target="_blank" href="https://www.advantageproperty.com.au/">Advantage Property Consulting.</a><a target="_blank" href="https://www.advantageproperty.com.au/"> </a>
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Five potential Melbourne hotspot suburbs

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So what are the first home buyers doing in the market now? They are struggling to make the transition to home owners as they have in every generation. I can remember being a first home buyer in 1994 and I had the same problem trying to get into the market. One year later and having missed out on three more affordable properties, I ended up getting into the market with my first home in Brunswick East in 1995, a three-bedroom brick Edwardian for $168,000. Prices have increased by 10% each year since, making affordability a real issue for first home buyers.
Our buyer’s agent company over the last 12 years has seen what works and what doesn’t work. So  our top five tips for first home buyers across Victoria at the moment are:
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Seek professional advice from experienced professionals or family/friends An experienced mortgage broker, buyer’s agent/advocate, building inspector and solicitor can give you the advantage when it comes to securing your first property. They are the key people whose experience you should tap into and seek help from. Remember, there is no need to reinvent the wheel. Invest in taking a few experienced property professionals or savvy property buyers for a coffee and learn from their tips and avoid the mistakes they made. 
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Do your research and be ready Make sure you have your finance pre-approved (in writing) and have at least a 5% deposit in a bank account that’s ready to go. If money is in an ING account, move it a few days earlier as it will take a few days to transfer the funds. If the right property comes up, you can bid unconditionally at the auction or make a strong private sale offer. Stay at home or in a cheaper share rental accommodation with others so you can save up that elusive first deposit. Set up a savings budget and subscribe to the many budget plans there are now online. 
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Do your due diligence Visit different types of properties (houses versus townhouses versus units) and different suburbs/areas and work out what properties and areas match your lifestyle. It may be better to buy an apartment in the inner suburbs that you will enjoy living in, versus a house in the outer suburbs that meets your accommodation requirements but doesn’t match your lifestyle. Then visit at least 20 properties in the area you have shortlisted so you get a good foundation of the comparable sales in that area. 
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Do your research and due diligence Make sure that you have a solicitor/conveyancer review the contract before signing and always organise a building/pest inspection prior to purchasing or make the offer subject to a satisfactory report. Ring the local councils and ask about any proposed developments and if it is in a unit complex, contact the Owners’ Corporation and ask about any building issues or proposed special levies. 
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Don’t get too emotional when negotiating It is easy to get carried away and expose yourself to over-paying for the property. Set a limit that is within your pre-approved budget and stick to it (within reason). Always have a family member/close friend or buyer’s advocate/agent who has had experience in negotiating or bidding at auction negotiate on your behalf and stop you from getting carried away as there will always be other properties. Sometimes you will need to walk away and wait for another door to open.</li>
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So what can be done to help first home buyers further?
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Stamp duty savings: The State Government’s announcement in the new budget that they would continue with the current 20% stamp duty reduction and a further 10% in January 2013 and a further 10% in both January and September 2014, totalling 50% was widely supported by real estate professionals. Now there needs to be more promotion of these incentives which can amount to up to $5,000 for purchases under $600K.</li>
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Follow the New Zealand model: As in New Zealand, allowing first home buyers to access their voluntary superannuation contributions and have it paid back in a certain number of years. This would assist more first home buyers in saving that elusive deposit and getting a foothold in the market.</li>
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Stamp Duty lay-by scheme: The REIA and REINSW recently proposed a “lay-by scheme” where first home buyers could pay back stamp duty over a three year period. With stamp duty amounting up to $35K for purchases up to the $750K maximum to qualify for the grant, a lay-by scheme would assist more FHB. 
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Savings Account: The government’s FHB Savings Account program has not really assisted anywhere near as many first home buyers as the government would have wanted. Another scheme that works and is well promoted needs to be implemented. 
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In summary, first home buyers are the most important piece of the property market jigsaw puzzle. First home buyers demand underpins our property market as it then encourages investors and the next middle group of buyers to “upsize” or trade-up. It will be interesting to see how many more first home buyers enter the market with rates reducing further.
First home buyers’s activity affects price movements and when interest rates start dropping, this also brings out more investors in the market. There are a definitive number of first home buyers out in the market, averaging around 21% over the last 21 years and the recent incentives have just encouraged these buyers to purchase earlier.
The State First Home Buyer’s new property grants of $13,000 expired on June 30 2012 in favour of a broader market stimulus through first-home buyer stamp duty cuts.
A 20% discount had previously been introduced, with another 10% discount to follow from January 1, 2013.
The recent high demand has fallen off from a peak of 30% to a low of 15% and it will take a while for first home buyers to increase to high levels again.
This article was written by Frank Valentic, Buyer’s Agent of the Year REIV (2007, 2009) REIA (2008, 2010), and Managing Director of Award Winning Buyer’s Agency, Advantage Property Consulting.
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So what are the 2012 first home buyers doing? Frank Valentic

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The Block auctions in 2012 are now over, and we congratulate all the contestants on their big financial windfalls. From Dale and Sophie ($355,000), Mike and Andrew ($434,000), Dani and Dan ($448,000) and the overall winners Brad and Lara ($606,000), the total combined profit was $1,843,000, working out to be an average of $466,000 each.
You would be disappointed if you were last year’s contestants, who combined won less than any of this year’s contestants, with total winnings of only $225,000.  That’s a total difference of $1,618,000 or 719% increase. No wonder this year’s contestants were crying with joy! Unfortunately there were no bargains to be had this year, unlike our purchase of Polly and Waz’s house last year for $858,000 for one of our investor clients.  With a fantastic rental of $995 per week and an extra $30,000 per annum in depreciation, this represented great buying.
I and other real estate professionals believed that Brad and Lara’s house would set the benchmark, as it was estimated to be worth at least $200,000 more than the other homes. This was based on the land size, which was 21% larger (158 square metres) and 44% wider (7.91 metres). I estimated that it would sell for $1,510,000 based on many recent comparable sales in the area. One recent example is an inferior townhouse at 3/297 Dorcas Street, South Melbourne (land size 113 square metres, 46 square metres smaller in land, two metres narrower frontage), which sold for $1,500,000 two weekends ago.
We were bidding for a female home buyer for Brad and Lara’s property with a budget of $1,380,000 and unfortunately were blown away by at least six bidders and an eventual sale price of $1,620,000. Our client was disappointed we were $240,000 short as she had already missed out on two properties on her own in the South Melbourne area. Karl Gillion from Buxton Real Estate did a textbook auction and made sure he got every last dollar out of the remaining buyers.
My predictions were then revised upwards to around $1.4 million for the remaining properties. We had an investor client who was keen to snag a bargain (around the $1,050,000 mark) for the next two auctions, but we didn’t even get a bid in with six to seven bidders taking Dan and Dani’s property to $1.44 million and Dale and Sophie’s to $1.33 million.
The last auction was the most talked about with the branded T-shirt guy (not going to give them any more publicity!) who had three other staff at the auctions in branded T-shirts and was bidding in ridiculous dollar and cents amounts. I was bidding for another investor who was attracted to the quality of Mike and Andrew’s property and in particular, their backyard. She was attracted to the potential rental return (about $1,100 to $1,200 per week fully furnished plus about $700 to $800 per week in tax depreciation) totalling around $1,800 to $2,000 per week or around 7% gross return.
I have bid at over a thousand auctions over the last 17 years and as a buyers’ advocate / buyers’ agent, I have attended many other auctions each weekend and I have never been involved in an auction as bizarre as this where a bidder bids in uneven increments, including cents with every bid. The auctioneer, Andrew Stuart of Hocking Stuart, did a good job trying to work out his bids, but I am surprised he accepted the uneven bids. In a normal auction, the auctioneer would round the amount up and only drop the bidding in set increments.  The backlash to this crazy bidding has started an online frenzy of annoyed viewers.
We stuck to our client’s pre-budget limit of $1.4, which would have delivered a healthy return of approximately 7%, and it was awarded to Mr T-shirt man for $1,401,001.01.
 
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What The Block 2012 result means for the property market
This year’s market conditions have improved, with five interest rate cuts starting to flow through to the marketplace and investors coming back into the market.
These properties were perceived as superior to last year’s due to their South Melbourne location on the border of Albert Park and the third-level “wow factor” of uninterrupted city views.
Melbourne’s property market is segmented, and you can’t generalise about all properties and put them in one basket. Renovated, well-located period houses are always in more demand than other property types, and these properties had all the “bells and whistles” apart from the compromises surrounding off-street parking and being on a through road.
The properties were purchased on average for $1,445,000, well above South Melbourne’s median ($967,000) and Albert Park’s median (1.29 million), and they were superior to many median price single-level houses in the area. I estimated that 405 (Brad and Lara) would sell for $1.51 million and the others between $1.3 million and $1.35 million. Based on this, they all sold for around $100,000 more than estimated market value.
History was made with online bidding used for the first time at a Melbourne auction. The flurry of live bids meant that only two online bids were called, and they were both $200,000 to $250,000 below where the live bids were at. I don’t think this is the way of the future for the Melbourne property market, as the online bidding cannot keep up with the pace of a live auction. I believe the buyers would have been better placed to use a buyers’ agent / buyers’ advocate to do the bidding for them or use an agent to take phone bids.
Reserves were set ridiculously low (at least $200,000 to $300,000 below most agents’ estimates) and much lower in comparison to last year’s reserves. No vendor bids were needed at any of the auctions.
Executive producer of Channel 9 Julian Cress got the mix right with low reserves and “onsite” auctions rather than the town hall auction room atmosphere last year.
There was a mix of home buyers and investors this year, whereas last year’s properties attracted mainly investors.
Consumer sentiment has improved considerably since last year, and l would doubt these properties would have achieved these prices in last year’s market, if auctioned at the same time as the Richmond auctions.
In summary our second Block auction experience was very different to our first, and our clients were disappointed to miss out, although they understand how important it is to stick to their set budgets.
The show continues to have a successful formula and attracted great support from millions of viewers. We enjoyed watching the series and enjoyed being a part of the experience, and it’s great to see some positive headlines in the press regarding the Melbourne property market this time.  The great Australian dream of owning a beautiful house continues to appeal to viewers and this year resulted in great results for Channel 9, the contestants and the successful purchasers.
Frank Valentic is managing director of <a href="https://www.advantageproperty.com.au/" target="_blank">Advantage Property Consulting.</a><a href="https://www.advantageproperty.com.au/" target="_blank"> </a>
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The Block auctions in 2012 are now over, and we congratulate all the contestants on their big financial windfalls. From Dale and Sophie ($355,000), Mike and Andrew ($434,000), Dani and Dan ($448,000) and the overall winners Brad and Lara ($606,000), the total combined profit was $1,843,000, working out to be an average of $466,000 each.

You would be disappointed if you were last year’s contestants, who combined won less than any of this year’s contestants, with total winnings of only $225,000.  That’s a total difference of $1,618,000 or 719% increase. No wonder this year’s contestants were crying with joy! Unfortunately there were no bargains to be had this year, unlike our purchase of Polly and Waz’s house last year for $858,000 for one of our investor clients.  With a fantastic rental of $995 per week and an extra $30,000 per annum in depreciation, this represented great buying.

 I and other real estate professionals believed that Brad and Lara’s house would set the benchmark, as it was estimated to be worth at least $200,000 more than the other homes. This was based on the land size, which was 21% larger (158 square metres) and 44% wider (7.91 metres). I estimated that it would sell for $1,510,000 based on many recent comparable sales in the area. One recent example is an inferior townhouse at 3/297 Dorcas Street, South Melbourne (land size 113 square metres, 46 square metres smaller in land, two metres narrower frontage), which sold for $1,500,000 two weekends ago.  

We were bidding for a female home buyer for Brad and Lara’s property with a budget of $1,380,000 and unfortunately were blown away by at least six bidders and an eventual sale price of $1,620,000. Our client was disappointed we were $240,000 short as she had already missed out on two properties on her own in the South Melbourne area. Karl Gillion from Buxton Real Estate did a textbook auction and made sure he got every last dollar out of the remaining buyers.

My predictions were then revised upwards to around $1.4 million for the remaining properties. We had an investor client who was keen to snag a bargain (around the $1,050,000 mark) for the next two auctions, but we didn’t even get a bid in with six to seven bidders taking Dan and Dani’s property to $1.44 million and Dale and Sophie’s to $1.33 million.

The last auction was the most talked about with the branded T-shirt guy (not going to give them any more publicity!) who had three other staff at the auctions in branded T-shirts and was bidding in ridiculous dollar and cents amounts. I was bidding for another investor who was attracted to the quality of Mike and Andrew’s property and in particular, their backyard. She was attracted to the potential rental return (about $1,100 to $1,200 per week fully furnished plus about $700 to $800 per week in tax depreciation) totalling around $1,800 to $2,000 per week or around 7% gross return.

I have bid at over a thousand auctions over the last 17 years and as a buyers’ advocate / buyers’ agent, I have attended many other auctions each weekend and I have never been involved in an auction as bizarre as this where a bidder bids in uneven increments, including cents with every bid. The auctioneer, Andrew Stuart of Hocking Stuart, did a good job trying to work out his bids, but I am surprised he accepted the uneven bids. In a normal auction, the auctioneer would round the amount up and only drop the bidding in set increments.  The backlash to this crazy bidding has started an online frenzy of annoyed viewers.  

We stuck to our client’s pre-budget limit of $1.4, which would have delivered a healthy return of approximately 7%, and it was awarded to Mr T-shirt man for $1,401,001.01

What The Block 2012 result means for the property market

This year’s market conditions have improved, with five interest rate cuts starting to flow through to the marketplace and investors coming back into the market.

These properties were perceived as superior to last year’s due to their South Melbourne location on the border of Albert Park and the third-level “wow factor” of uninterrupted city views.

Melbourne’s property market is segmented, and you can’t generalise about all properties and put them in one basket. Renovated, well-located period houses are always in more demand than other property types, and these properties had all the “bells and whistles” apart from the compromises surrounding off-street parking and being on a through road.

The properties were purchased on average for $1,445,000, well above South Melbourne’s median ($967,000) and Albert Park’s median (1.29 million), and they were superior to many median price single-level houses in the area. I estimated that 405 (Brad and Lara) would sell for $1.51 million and the others between $1.3 million and $1.35 million. Based on this, they all sold for around $100,000 more than estimated market value.  

History was made with online bidding used for the first time at a Melbourne auction. The flurry of live bids meant that only two online bids were called, and they were both $200,000 to $250,000 below where the live bids were at. I don’t think this is the way of the future for the Melbourne property market, as the online bidding cannot keep up with the pace of a live auction. I believe the buyers would have been better placed to use a buyers’ agent / buyers’ advocate to do the bidding for them or use an agent to take phone bids.

Reserves were set ridiculously low (at least $200,000 to $300,000 below most agents’ estimates) and much lower in comparison to last year’s reserves. No vendor bids were needed at any of the auctions.

Executive producer of Channel 9 Julian Cress got the mix right with low reserves and “onsite” auctions rather than the town hall auction room atmosphere last year.

There was a mix of home buyers and investors this year, whereas last year’s properties attracted mainly investors.

Consumer sentiment has improved considerably since last year, and l would doubt these properties would have achieved these prices in last year’s market, if auctioned at the same time as the Richmond auctions.

In summary our second Block auction experience was very different to our first, and our clients were disappointed to miss out, although they understand how important it is to stick to their set budgets.

The show continues to have a successful formula and attracted great support from millions of viewers. We enjoyed watching the series and enjoyed being a part of the experience, and it’s great to see some positive headlines in the press regarding the Melbourne property market this time.  The great Australian dream of owning a beautiful house continues to appeal to viewers and this year resulted in great results for Channel 9, the contestants and the successful purchasers.

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The Block 2012 properties sold for around $100,000 above estimates, reflecting improved consumer sentiment from last year: Frank Valentic

South East Queensland developer&nbsp;<a href="https://www.apartments.com.au/developers/gardner-vaughan-group">Gardner Vaughan Group</a>’s entry into the Gold Coast apartment market has progressed from pipeline to market, with its Chevron Island project Bronze on Chevron now formally available to purchase ahead of a planned 2029 completion.

The 119-apartment development on Mawarra Street marks the Brisbane-headquartered builder-developer’s first residential play in the Gold Coast, following its expansion south from Brisbane and the Sunshine Coast.

<a href="https://www.apartments.com.au/new-apartments/bronze-on-chevron-8-mawarra-street-surfers-paradise-qld-4217">Bronze on Chevron</a> comprises a mix of two-, three- and four-bedroom residences, with pricing starting from just over $1.5 million. The project is being delivered under Gardner Vaughan’s fully integrated model, with the group acting as both developer and builder, a structure it has consistently applied across its South East Queensland portfolio.

[smartcode_project:default project_id=107520 project_image_fid=367182]

Architecture has been designed by <a href="https://www.apartments.com.au/architects/cottee-parker-architects">Cottee Parker</a>, with landscape architecture by <a href="https://www.apartments.com.au/landscape-architect/jeremy-ferrier-landscape-design">Jeremy Ferrier</a>. The building presents as a single-tower scheme, with a focus on maximising outlook across both the Surfers Paradise skyline and the Nerang River.

Apartments have been planned with open-plan living zones extending to generous balconies, a response to the site’s dual-aspect positioning between river and ocean. Interiors follow a restrained coastal palette, with two colour schemes offered, and an emphasis on natural light and cross-ventilation.

[smartcode_project:default project_id=107520 project_image_fid=367181]

Resident amenity is concentrated across more than 1,250 sqm and includes a resort-style pool, gym, yoga lawn and rooftop entertaining areas. A function space with catering facilities forms part of the upper-level offering, alongside north- and south-facing outdoor areas.

Ground level will incorporate two retail tenancies, intended to extend the existing village character of the surrounding streets.

&nbsp;

[smartcode_project:default project_id=107520 project_image_fid=367200]

The project sits within walking distance of Thomas Drive’s established dining strip, while maintaining proximity to <a href="https://www.apartments.com.au/developments/surfers-paradise-qld-4217">Surfers Paradise</a> beach and broader Gold Coast amenity. The location, positioned on Chevron Island between the river and coastline, has increasingly attracted mid- to high-density development in recent years as the precinct evolves beyond its low-rise origins.

Gardner Vaughan’s move into the Gold Coast was first signalled in 2025, with the group identifying the region as a natural extension of its operations. Chief Executive Officer Simon Betteridge described the expansion as both “strategic and natural”, citing demand for well-designed apartments in lifestyle-driven markets.

Construction is expected to complete in early 2029.

[smartcode_project_cta:default project_id=107520]

Joel Robinson

Gardner Vaughan brings Bronze on Chevron to market as Gold Coast debut

One of the penthouses at Lily Lane, the latest stage of Carrington Place by Ellipse Property, has set a new local apartment price record.

The four-bedroom residence, purchased by a local downsizer, sold for $5.75 million—around 75 per cent higher than the previous record of $3.3 million.

Over 40 per cent of the first release of apartments at&nbsp;<a href="https://www.apartments.com.au/new-apartments/lily-lane-at-carrington-place-castle-hill-32-carrington-road-castle-hill-nsw-2154">Lily Lane</a> have already been snapped up just six weeks since it launched to the market.

&nbsp;

Located at 32 Carrington Road, <a href="https://www.apartments.com.au/developments/castle-hill-nsw-2154">Castle Hill</a> and designed by award-winning architects <a href="https://www.apartments.com.au/architects/ptw">PTW</a>, Lily Lane is directly opposite the Hills Showground Metro station. It offers a total 213 units over two 12-storey towers - a mix of 67 one-bedroom, 100 two-bedroom and 46 three-bedroom apartments - with a ground-floor retail offering.

[smartcode_project:default project_id=151821 project_image_fid=368352]

Blake Schulze, National Director – Residential at <a href="https://www.apartments.com.au/project-marketer/colliers">Colliers</a>, says around 44 per cent of buyers are&nbsp;owner occupiers, with 35 per cent being investors and 21 per cent first homebuyers.

“Developments of this calibre are very rare in the Hills District, and Lily Lane’s sales success demonstrates the depth of demand for over-sized apartments that genuinely compete with freestanding homes," Schulze says.

"We are seeing particular demand from downsizers who want to remain in the area but transition into spacious, high-quality apartment living."

On the penthouse sale, it says it shows buyers&nbsp;are prepared to pay a premium for scale, quality, and direct access to the Metro.

[smartcode_project:default project_id=151821 project_image_fid=368351]

One-bedroom apartments are sized from 50-72 sqm with prices starting at $745,000, while two-bedrooms are priced from $990,000 with sizes from 75 to 132 square metres. Three-bedroom floorplans are sized between 97 and 182 sqm,, with prices starting at $1,395,000.&nbsp;

The three remaining penthouses, spanning up to 262 sqm, are priced from $2.9 million.

Over 75 per cent of apartments include dedicated studies, multipurpose rooms or family rooms, with select layouts offering walk-in pantries and laundries. Apartments are appointed with premium Miele appliances including ovens, washing machines, dryers, gas cooktops and dishwashers, while larger residences also incorporate integrated Miele microwaves, Fisher &amp; Paykel integrated refrigerators and five-burner Miele cooktops.

[smartcode_project:default project_id=151821 project_image_fid=360285]

Lily Lane will be constructed by award-winning iCIRT-rated builder <a href="https://www.apartments.com.au/builders/decode">Decode Group</a>, with construction to commence in mid-2026 and expected to complete early 2029.

Carrington Place comprises more than 800 apartments and is being delivered across multiple stages, with completion expected in 2032. Integrated with neighbouring bushland, the project will feature over 20,000 sq, of outdoor recreational area, including a one-kilometre boardwalk to Fred Caterson Reserve.&nbsp;

The Hills Showground Metro Station is just a two-minute walk away, offering fast connectivity to Sydney’s CBD, North Sydney, Chatswood, Macquarie Park and Norwest Business Park.

[smartcode_project_cta:default project_id=151821]

Ellipse sets Castle Hill apartment record with $5.75 million Lily Lane penthouse sale

Fresh off completing its Delano Crows Nest development, Lindsay Bennelong has lodged plans for its next project, this time turning its attention back to the beach.

The developer, started 20 years ago by Clarendon Homes founder Peter Campbell, is proposing a 37-apartment scheme at <a href="https://www.apartments.com.au/new-apartments/17-25-ashburner-street-manly-nsw-2095">17-25 Ashburner Street</a>, Manly, positioned between the southern end of <a href="https://www.apartments.com.au/developments/manly-nsw-2095">Manly</a> Beach and East Manly Cove.

Lindsay Bennelong called on local architecture firm Platform Architects to design the new building, given their success at Finn, Lindsay Bennelong's current luxury apartment project on North Steyne.&nbsp;

According to the Design Verification Statement by Bridie Gough of Platform Architects, the proposal “relates to the current context but also the desired future character of taller buildings suitable to the new planning controls.”

The site has been identified as a Low to Mid-Rise Housing (LMR) location, given its position within 400 metres of the Manly Town Centre E1 Business Zone. The LMR controls are intended to unlock additional housing supply in well-located areas close to public transport, allowing developers to seek increased height limits to support greater density.

“The proposal seeks to provide this increased level of housing whilst being respectful of some of the smaller scale buildings also nearby,” the statement reads.

Lindsay Bennelong Development Director Leigh Manser said the project has been carefully aligned with the intent of the LMR controls. The proposal will significantly increase housing yield on the site, replacing four houses and 10 apartments, comprising 25 bedrooms, with 37 new apartments delivering a total of 94 bedrooms, whilst remaining compliant with the LMR controls.

“Sydney is in a severe undersupply, and delivering more dwellings and more bedrooms than what currently exists is exactly what the LMR policy is designed to activate,” Manser said, noting that nine of the apartments will be allocated as affordable housing for frontline workers.

“We have already commenced discussions with our community housing provider to determine the rental levels that frontline workers can realistically afford in this location,” he said. “These will need to sit well below the standard affordable housing benchmark of 20 per cent below market rent, and that has been factored into our feasibility and pricing.”

<img alt="Manly" data-entity-type="file" data-entity-uuid="ad03000f-19f9-48b4-b27d-e85ca800a1da" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-04-30%20at%208.41.59%E2%80%AFAM.png?VersionId=a.txHwCZgbCInlQ6QXbIrI.umvW1T.r8" />

The design of the building incorporates a wave-like indentation running through the façade, referencing the nearby coastline and anchoring the building within its local context.

The&nbsp;Design Verification Statement says careful consideration has been given to the articulation of the building, ensuring the bulk is broken down to a more human scale through a defined four-storey podium."

The scheme includes a mix of one-, two- and three-bedroom apartments, as well as a full-time building manager's office and wellness facilities including a sauna and a gym.

“The design ensures a high level of amenity, with apartments offering generous private open space, many with expansive views, and all with comfortable proportions."

<img alt="Bennelong" data-entity-type="file" data-entity-uuid="6a7f2812-72a1-4959-84b0-997e8cd88aed" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-04-30%20at%2010.15.50%E2%80%AFAM.png?VersionId=6iMxU3MkXmHVHAoNhYBjnqgka8CUZNbk" />

<a href="https://www.apartments.com.au/developers/lindsay-bennelong-developments">Lindsay Bennelong</a>&nbsp;is currently developing Finn Manly, just four full-floor luxury apartments on North Steyne. They recently welcomed residents to its 81-unit Delano Crows Nest development, a&nbsp;carefully scaled infill project designed to bridge&nbsp;<a href="https://www.apartments.com.au/developments/crows-nest-nsw-2065">Crows Nest</a>’s lively village centre with its surrounding heritage streets.

Designed by&nbsp;<a href="https://www.apartments.com.au/architects/ajc-architects">AJC Architects</a>,&nbsp;<a href="https://www.apartments.com.au/new-apartments/delano-crows-nest-27-57-falcon-street-crows-nest-nsw-2065">Delano</a>&nbsp;is arranged across three low-rise buildings, incorporating a mix of one, two, and three-bedroom apartments alongside a limited number of townhomes addressing Hayberry Lane. The architectural approach drew on the area’s Art Deco lineage, reinterpreted through contemporary detailing and framed by landscaped communal gardens.

The developer also has a development site in Maroubra.

First look: Lindsay Bennelong's new Manly apartment development revealed

Fifty-nine residences across 37 levels. No more than two per floor. With 80 per cent now sold, what remains at <a href="https://www.apartments.com.au/new-apartments/madeline-by-mosaic-broadbeach-22-mary-avenue-broadbeach-qld-4218">Madeline by Mosaic</a> is a short list.

Madeline was always conceived at a scale that sits outside the normal register of Gold Coast apartment living. The residences are half- and full-floor configurations, with the largest spanning more than 400 sqm, dimensions that place them closer to the penthouse end of the market regardless of where they sit in the building.

That scale is the organising principle of everything else: how the floorplans are laid out, how the materials read, how the connection between inside and outside works.

[smartcode_project:default project_id=150135 project_image_fid=355941]

The interiors were developed in collaboration with <a href="https://www.apartments.com.au/architects/fraser-partners-0">Fraser &amp; Partners</a>, the architecture practice&nbsp;<a href="https://www.apartments.com.au/developers/mosaic-property-group">Mosaic</a> brought in as design partner for the first time on this project. The palette runs to natural stone, textured timbers, and soft metallics, materials chosen as much for their tactile quality as their appearance.

Light cleverly shifts across surfaces through the day, and the design is explicit about wanting that to be noticed. Full-height glazing runs across the primary living areas, and where the building faces east toward the ocean, those walls of glass are doing real work: framing a view corridor that the site's position directly opposite Broadbeach State School's playing fields keeps permanently open.

That outlook is the site's most consequential asset. In a suburb where new towers continue to rise, a protected view line is genuinely rare, and the Mary Avenue address secures it. Residents at Madeline will look out over open parkland rather than the rear of another building, a distinction that becomes more meaningful with each new development approved nearby.

[smartcode_project:default project_id=150135 project_image_fid=355939]

The private outdoor spaces are sized to match the residences themselves. Terraces on the upper levels frame uninterrupted ocean panoramas, and the planning ensures that living areas extend into those outdoor zones rather than treating them as separate attachments. The flow between the two is part of the design intent, not an afterthought.

Inside, the finish specification reflects the same approach. Rich stone benchtops, warm timber joinery, bespoke hardware, each element specified to hold up over time rather than read as a moment in a particular trend cycle.

[smartcode_project:default project_id=150135 project_image_fid=3409]

Beyond the residences, the amenity offering extends that register. A lap pool and sun deck anchor the outdoor space, alongside a magnesium pool, cold plunge, steam room, and sauna.

A commercial-grade gymnasium, residents' lounge, library, and boardroom round out a programme that functions more like a private members club than a standard building amenity floor.

Construction has commenced under Mosaic's in-house building arm, with completion scheduled for late 2028.

[smartcode_project_cta:default project_id=150135]

Madeline by Mosaic delivers penthouse-level living across every apartment

Developer Fortezza Group is the latest to take its new apartment development, <a href="https://www.apartments.com.au/new-apartments/the-belvedere-5-7-church-street-nelson-bay-nsw-2315">The Belvedere in Nelson Bay</a>, to the NSW Government.

Fortezza, predominantly a South East Queensland developer, is the latest to apply for State Significant Development&nbsp; status through the NSW Government's Housing Delivery Authority, a pathway becoming favoured by developers to speed up the approval process.

They are planning 57 two- and three-bedroom apartments across 5-7 Church Street and 42 Donald Street, near d'Albora Nelson Bay Marina. The diverse apartment mix has sizes from just over 80 sqm to the largest three-bedroom penthouses that reach nearly 200 sqm.

<img alt="Fortezza" data-entity-type="file" data-entity-uuid="090360e1-66d7-43ad-b686-aba81f173bf2" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-04-29%20at%2010.22.40%E2%80%AFAM.png?VersionId=DMqF96eBZolqSAAAcugX0l66ueWng66m" />

Fortezza calls the project a "piece of Istria in Nelson Bay,"&nbsp;referring to the largest peninsula in the Adriatic Sea, shared by Croatia (90%), Slovenia, and Italy, which is known for its Roman history, Venetian-style coastal towns and inland hilltop villages.

They say the The Belvedere is strategically positioned at the apex of Nelson Bay, offering unrivalled views of the ocean, the bay and captivating topography of the area.

"Our commitment to maintaining the integrity of every view and sight line has been relentless," Fortezza Group says.

"Through extensive modelling and analysis, we ensure that each apartment enjoys the natural beauty of Nelson Bay, regardless of future developments. Each design element is carefully curated to harmonise with our European heritage, drawing profound inspiration from the Roman architectural marvels in Istria. The arches, the cascades of greenery and the stonework that define our project pay homage to the structures that once exemplified Roman grandeur."

Residents will have access to a pool, communal green spaces, an office and a coffee shop.

Frank Valentic

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