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GUEST OBSERVATION
Those who have read my book or heard one of my presentations, are often struck by the juxtaposition on some of my investing suggestions. It usually goes something like this:
a) You’re a conservative investor but you recommend spending more money on property at times like this.
b) You say Sydney is the best and most robust market in Australia but when I heard you speak you are saying that Sydney is “terrible” investing right now.
c) You say you’re not a speculator, but you actually have the gall to recommend the Gold Coast market now? Are you mad?
Well. I can answer them all with yes, yes, yes and yes (the last one being for ‘yes’, I am mad!).
So let me try and explain.
Is Mr/s Average Wealthy?
I have made almost all of my wealth from investing by putting my money down when it seemed like absolutely the craziest thing to do. Think about this for a second.
The average price for a 2/1/1 unit is say Coogee/Bondi is now approaching $850,000 to $900,000. Clients of ours were buying these same units for as little as $530,000 as recently as 2012. Some of these same clients are now selling. Most are not. All of them are ecstatic with the performance of their investment(s). The prevailing rent at the time was approximately $630 to $650 per week. $530,000 for $650 per week is an excellent deal, especially in premium Sydney.
Now, saturation of the rental market has meant that these rents should arrive at between $580 per week and $590 per week within 18 months. Remember, this is an investor lead property recovery. More rental stock will mean higher vacancy rates going forward.
It is the average property investor that has driven the prices up to almost $900,000. Do you think they would be happy with their results when they wake up to realise their investment is now yielding sub 3%? I suspect not. More likely, I’d even say with certainty that the likely result is a small but immediate retreat in prices to reflect the newfound ‘wisdom’ of investors.
Keep in mind that I don’t see a larger correction (yet) while interest rates oscillate around these levels, so I’m not here to spook anyone. But investing is more about psychology than one would think.
Perception Bias
The problem of the ‘average’ investor in this scenario is that they have perception bias.  World class resource investor Rick Rule cites that “expectations of the future are usually set by their experiences in the immediate past”. The punter saw $600,000 become $700,000. They saw $700,000 become $800,000. They saw a slight arm wrestle with the market in winter/spring of 2014 which might have changed their mind. But alas, the bulls won that round with the noise of interest rates pursuing their downward trend. Then the last move from $800,000 to $900,000 has sealed the deal. The averages are piling in. Remember, ’average’ doesn’t become wealthy.
Now their expectations are set. $900,000 will now become $1 million. $1 million will become $1.1 million. Rinse, repeat.
No. It. Will. Not.
This is not just illogical, wishful thinking and void of wisdom, but it also ignores a common tenant of investing in assets. A Golden Rule I have always followed as a professional investor, that being: ‘an assets value cannot be outstripped by people’s ability to afford that asset’. With Sydney-siders bordering on 55% of their household income being spent on property, (this has (historically) always been our limits...since our economy went global in 1988. If I am to be wrong, please tell me which part of the family budget will be stripped. Is it food? Education? Is it healthcare? Try telling your child they’re not getting the next iPhone?
If you are betting on this happening... you are betting against history. And if I am wrong by a decimal point, it doesn’t make me wrong to warn off investing in Sydney (or Melbourne for that matter) now. If we decide to break a record and spend 56% of our household income on property, this discrepancy wouldn’t even cover the cost of ¼ of your stamp duty.
No, my friends. Mr and Mrs Average are about to lose their shirt. I just hope it isn’t you; dear reader.
Over Committed? Is there a way out?
But now for the good news. The above scenario, while inevitable...is not ‘imminent.’ I have been forced to take a more ‘hawkish’ view of the prevailing sentiment over the past 18 months, and of course the fundamentals. Interest rates will be lower for longer. One more rate move down seems likely, but it matters not. One rate decrease equals $40 per month more affordability. If you think this changes anything try the Woolworths test. Go in and spend $40 and see how long it takes you to do it. You’ll be at the register in four minutes flat...no need for the trolley with $40 worth of goods!
For those that are over committed, there is time to get out of this mess. For those that bought a lemon, time to rethink. For those that are going to sell anyway, in say the next 4 years - maybe now is a good time to consider it. Mr and Mr Average certainly aren’t thinking too hard. They are getting pretty drunk on their own kool aid... so while they are still inebriated, perhaps sell them yours before they sober up. They’re going to buy anyway, why not make sure it’s yours?
Is there any opportunity in the market left?
I was gratified last weekend to finally see some of the major financial newspapers acknowledge that opportunity is abound in South East Queensland, something our office has been screaming from the rooftops for almost 30 months!
“The next cycle could prove to be a super cycle driven by Chinese investment and rapidly growing tourism,”CEO of Fat Prophets Angus Geddes says. Not one to mince words, Mr Geddes also agreed with my sentiment. “I would not be touching them [Sydney, Melbourne, London, Auckland] at current elevated levels with a barge pole.” Along with Andrew Wilson, property economist from ‘Domain’ is similarly upbeat about the Gold Coast.
But of course 9 million people (Sydney and Melbourne) deserve a lot of attention, and for the past two years they have spoken. But ponder this.
For every $600,000 I’ve seen make $850,000 in Sydney, I’ll show a better deal with even more upside in Brisbane or the Gold Coast. Acknowledging that the next two years are expected to be bullish for these cities, this has not precluded great profits over the past two year either. A client of ours bought a unit 15 months ago in Kent St New Farm (Brisbane), for $343,500 (2/1/1) in a small block of six. Another apartment in the same small building (of comparable merit and amenity) just sold for $450,000, an almost 25% gain in equity for our client. Given the small entry costs, higher rental yield and continual expected growth going forward... I know what I’d prefer. To eke out the same gains in Sydney, an investment of double that size is necessary (notwithstanding that I think the average priced investment gains are over anyway!)
Similarly, a Gold Coast property boom, for all its volatility... is a truly remarkable thing to participate in for three years out of 10. Now is the season where larger developers move into the Coast and pick up the last big land holdings while they’re still cheap. In the past six weeks, six clients of ours have experienced gains in excess of 100% for their venture into the Gold Coast less than two years ago...when there was blood on the floor. To cite the most profitable deal - a client of ours paid $165,000 some 24 months ago sold for $500,000 to a developer into the well publicised Banyan Tree Resort consolidation of some $50 million. Our buyers agents located four clients in this block, and by all indicators at the time I’d like to think it was an obvious position we took in identifying this site as a likely future development site. But it does make you then wonder what could have induced the seller to sell two years ago; with a rental return of $250 per week and a low body corporate fees in such a site rife with potential.
Clearly, the factor here wasn't a fundamental one...but a psychological one.
Predictions
As the property market recovery turns now to the smaller cities, I expect to see larger profits on smaller outlays on the Gold Coast and Brisbane. Some time ahead should see the regionals follow suit, albeit with a much higher risk proposition.
While now being very bearish on Greater Sydney and Melbourne average priced properties, I expect the premium markets to thrive. It’s universally understood and historically shown that this is the way markets mature within each cycle. Markets recover in a financial sense from the “bottom up”. That is, everything that’s cheap... flies first. And in a geographical sense, the market moves from ‘in and out’. That is, from an ‘epicentre’ (high density urban) out into the out suburbs, and finally to the fringes. Also known as... ”the ripple effect.”
Stop thinking about where the money was made. Start wondering where the money will be made next.
I’ll expand on the ‘ripple effect’ in the next article and show the average investor how to truly beat the market to the next property profits. I’ll also briefly touch on the much revered “Chinese investor” and the oft-misinterpreted truth about why Chinese investment is healthy, but why it isn’t going to change your property price over the long term by any more than $1,000!
Gavin McPherson is the chief executive of <a href="https://www.oasisproperty.com.au/" target="_blank">Oasis Property Group</a>. 
His book, 'Value Investing in Property - What would Warren Buffet do if he was buying property in Australia?', takes aim at the get rich quick property experts and explains instead the sturdy path to wealth through value investing in property. 
As a buyer’s agent, Gavin and his offices have assisted over 2,000 plus property transactions valued at well over $2 billion.
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Average investors get average results: Gavin McPherson

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GUEST OBSERVATION
In my time of investing and purchasing for investors, I have the luxury of knowing that this current market movement is not normal, nor an accurate prediction of what they next five years will be like.
In fact, if anything, I am more bearish now about property than I have been for some six years, seeing that affordability and irrational exuberance have taken over rational thinking and sensible wealth planning.
But I have never actually been called a property bear - until now, that is.
I copped the comment last week at a luncheon, replete with bankers and wankers. I might also add that my fellow lunchers included people who exclusively made their money from giving obscene levels of credit to suckers (otherwise known as consumers) to go and buy more residential property.
After I gave someone a response that they clearly didn't want to hear, of course I was howled down. In their minds, there are so many people out there buying right now. The masses clearly can't be that wrong.
Can't they? Have they ever been that wrong before?
You bet they have. In fact, history demonstrates this repeatedly. I cite below one of the most extraordinary examples of irrational exuberance ever to present itself to an investor market.
Tulip Mania
The Tulip Craze of Holland truly demonstrates not only what a human mind can conjure up to consider an investment, but how obsession and irrational exuberance can take over even the most logical of minds.
The flower Semper Augustus was judged to be the most valuable flower in the Tulip family in the 1600s. So much so that in 1630 one person paid 3,000 guilders for one tulip bulb.
Do you know what the value of a guilder was in 1630s? Well, me either - but I can tell you that three months later, a Rembrandt painting sold for 1,500 guilders. Importantly, Rembrandt (1606-1669) was not one of those artists who were popular only after he died!
Moving on to 1633, records show that one investor swapped traded three tulip bulbs for a whole property. In the ensuing years (1634-1673) the value of tulips then ran up by another 1000%.
Then, one day, at a non-descript tulip auction, one large buyer didn't turn up to claim his prized tulip trade. Upon witnessing this, other buyers baulked. The ensuing panic saw the value of tulips return to their intrinsic value in less than a week: zero (or at least, the nominal value of just a beautiful flower).
The government of the day agreed to protect people's bad investments to the value of 10%, a story that is repeating itself now. That is: privatise the gains, but socialise the losses. Sometimes, we never learn!
Now, in the above examples it is true to say that there was profit to be made from the trade at every stage except for the when the last investors jumped in.
There is no denying that many of you already have and still will make money from property in 2014-15 in particular segments of the market. But as time passes the risk increases that you may just be the one holding the bomb when the fuse runs out.
I also understand that tulips aren't property. Of course, property has a utility value of some considerable price (a roof over someone's head), but we still need to keep in mind that it is the same "animal spirits" brought out tulip mania that are playing itself in our property market.
This article continues on the next page. To continue, please click below.
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Investors keep bidding the prices of property up, so much so that they can reflect far more than the actual value of the property.
I find it almost strange that I am writing this article at the time when my <a href="https://propertyobserver.com.au/forward-planning/investment-strategy/market-trends/23116-thursday-may-30-observer-gavin-mcpherson" target="_blank">past simple calculations</a> (see paragraph 6) have come about, with average Sydney prices now coming in at $800,000; only $500 off my prediction.
With an interest rate decrease given to consumers last August '13, it is true to say that the potential to bid homes even higher is likely. But not by much. Ask yourself how much more that $40-$50 per month can add to a house price. Very little, I would imagine.
But keep in mind, my calculations used a logical and arithmetic method to it. Logic and arithmetic don't come into the equation when "animal spirits" take over.
And that's why I think property is going to go higher, and produce a lot of pain for those latecomers (still) piling into the Sydney and Melbourne property markets right now.
I am not happy about it, but it seems the inevitable next step for the market to take. Call it irrational exuberance.
The fact remains that the greatest risk always presents itself when the the most people are in the same trade - all expecting it to go up in perpetuity.
Any decrease in this demand in the future can only decrease price expectations.
Is there still opportunity?
The only opportunities I see (at all) for real capital growth are north of the New South Wales border. In <a href="/expert-insights/buying/six-tips-to-help-you-through-the-next-market-cycle-unscathed-gavin-mcpherson">the same article mentioned above</a>, I observered that Brisbane and the Gold Coast presented real buying opportunities over 12 months ago. In fact, they were perfect buying then. It's true that some of the gains have been lost to modest capital growth since then, but opportunity still abounds while so much attention is focussed on the overbid Sydney and Melbourne markets.
And for those who still carry that foolish notion, "I want to live near my investment property, so I can check on it", may I ask how you might feel in 2016/17 if you had to drive by that same property to be reminded that you were in a negative equity position. Wouldn't that be ironic?
Brisbane - I still love it. As Australia's fastest growing capital city (yes, it has overtaken Perth some time ago now!) and Australia's 3rd largest city, for me still stands out as a bastion of value.
For Gold Coast, I don't deny the volatility that this presents over a long term investment period. All the same, for those that can avoid the high rise district and cope with this long term volatility, the seachange effect is something that I expect is occurring in earnest now.
Don't forget, in 2001-04, when prices doubled in the southern states (especially Sydney and Melbourne), the Gold Coast (and less so Brisbane) became a beneficiary of this as migration led by affordable housing made the move north a rational decision. As the sunny state hit prices only 10% below Sydney/Melbourne leading up to 2007, the rationale for a 'seachange' diminished.
With southern states house prices edging $800k and $700k respectively now, yet with Brisbane and Gold Coast at just over half of that, are you telling me that history is not about to repeat itself?
I'd at least put down a few tulip bulbs to bet that it will.
Sydney and Melbourne at record highs, or the northern cities on the way up. What side of this trade are you going to get caught on?
Oh, one more tip. If you think that something like Tulip Mania can't strike again, I have two words for you. Bit. Coin.
Gavin McPherson is the chief executive of <a href="https://www.oasisproperty.com.au/" target="_blank">Oasis Property Group</a>. His book, 'Value Investing in Property - What would Warren Buffet do if he was buying property in Australia?', takes aim at the get rich quick property experts and explains instead the sturdy path to wealth through value investing in property.
 
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Sydney and Melbourne: ticking time bombs

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GUEST OBSERVATION
Foreign investment is one of Australia’s biggest media issues in residential real estate at the moment. As a professional property buyer, I hear people saying:
<ul>
<li>“Every time I go to an auction, I get beaten by a foreigner.”</li>
<li>“These people can’t have that much money, there must be something illegal happening”</li>
<li>“Why are they winning every single auction?”</li>
</ul>
The ‘elephant in the room’- what we are not comfortable saying - is that when we say foreign, we are talking about the Chinese property buyer. I don’t think people would feel as aggrieved if that buyer was from Italian descent, Lebanese descent…or, even more recently, of Indian descent. It is Chinese buyers people seem to have a problem with. But is there even a problem in the first place? I would like to explore the issue by going straight to the Foreign Investment Review Board (FIRB) website and seeing how they address this from a policy position. The FIRB says:
“It is the government's policy that foreign investment in residential real estate should increase Australia's housing stock. That is, the policy seeks to channel foreign investment in the housing sector into activity that directly increases the supply of new housing (such as new developments of house and land, home units and townhouses) and brings benefits to the local building industry and its suppliers.”
That’s it. That’s our policy – bottom line. The rules are designed to allow overseas buyers to support the building of residential property in Australia. They aren’t designed to allow overseas purchasers to buy into existing and established Australian property. After all, we already know that Australia has a housing shortage of between 200,000 and 270,000 homes at any given time.
The Foreign Investment ‘No Overview At All’ (Operating in the Dark) Board
A second question is whether the FIRB is able to police its own rules.  In <a href="https://www.smh.com.au/national/bureau-of-statistics-in-dark-on-foreign-investment-in-australian-residential-property-inquiry-hears-20140625-3atlw#ixzz39Z1NYQqZ" target="_blank">a recent article </a>in the Sydney Morning Herald, journalist Gareth Hutchens writes:
“Senior Bureau of Statistics officials have admitted they read trade magazines and newspapers to keep on top of changes in the amount of foreign investment in Australia's residential property, because their collection of such data is too patchy.”
At the same hearing - Paul Mahoney, an ABS assistant statistician, said they actively researched newspapers for information on foreign purchases of residential property, even though they knew the practice was ''a bit hit and miss''. But, in his words; “it had to be done... because the ABS gathered very little data itself”. Really?
Wouldn’t that be like me trying to be a talent scout for the Australian cricket team reading the back page of the local paper to find my next big talent? Efficient? Surely not.
This admission came during this public hearing , where the hearings are being held in response to industry concerns that foreign investors, particularly Chinese, have been sidestepping our laws to buy established property over locals and inflating prices to a stage beyond affordability.
At this same enquiry, Brian Wilson (from the FIRB) said:
“Much of the public controversy about Chinese investors buying up residential real estate was “not necessarily malevolent” but not based on facts”
But how Mr Wilson say this? Clearly he doesn’t have the facts, as the FIRB’s own reporting indicates.
Article continues on the next page. Please click below.
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Legitimately Illigitimate?
Personally, I am not against foreigners, or specifically, Chinese buyers, buying established property in Australia. Chinese buyers are buying property in Australia via their local citizens, who may just happen to be relatives, friends and even business colleagues. As a matter of fact I have purchased and assisted in the purchase of many, many legal Australian citizens - some of whom may have raised the funds for their purchase via families and friends overseas. I can’t validate where the money is coming from, but I can say that:
<ol>
<li>As much as this is explained to me, it would be considered rude in Chinese custom to expect to sign an agreement between parties (let say it is a family and friends ‘collectively’ pooling money) that would validate any formal agreement. Trust is an important virtue. </li>
<li>The internal belief within China is that the government is currently addressing corruption and modes of money mobility. Whether rumour or fact – the population that has access to disposable money for investment believe that the opportunity to move money out of China will be more difficult in the future. As such, they are taking advantage of this now – and any ‘premium’ they are seen to be paying for a property can be considered the cost of ‘doing business’. A ‘tax’ even.</li>
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Having come from an Anglo-Saxon background myself, the fact that Chinese people have an established such trust and understanding with their families back home should be considered a source of strength. Culturally, if I could be provocative, I think that is something we could all learn from. The fact that they decide to build their wealth outside their mother country should be considered a compliment to the value of property in Australia.
In a global economy, where we are prepared to compete on almost every other economic level, including labour, we should not deprive those people (who can afford) it of our land. They are one of our closest neighbours and, in my opinion, it’s inevitable anyway. The problem that I have is that to be told by our powers that be that they are looking into the problem and can’t see a problem. It seems like a great case of them putting their head in the sand. I am not so much concerned about the non-problem, but I am concerned about the lack information obtained by the FIRB. As to the question of local buyers feeling as if they have missed out. If you follow the way a property purchasing ladder works, you’d see that for all the noise created by the emergence of the Chinese buyer – the reality is that the successful Chinese buyer only wins the property by one dollar or $5000 in the case of a property auction. Only a fool would pay more. It could even be true that the next one, two or even three under bidders might have been Chinese bidders too…but, in my experience, this rarely adds more than a few thousand dollars at best and perhaps one or two percent of the property price (at worst). Remember, when someone wins an auction, they only win by a margin ‘just’ higher than the next highest bidder.
It’s called the ‘purchasing pyramid’, with a fundamental base always supporting the underlying value with fewer and fewer buyers bidding prices up, until you have a winner. Take the top dog away, you’ve still got a good price. Believing that Chinese buyers fill the whole pyramid, or at least even the top part of that pyramid, is not only foolish, it’s incorrect. The claim that it is adding 5,10 or 15% to our established property prices just isn’t true and therefore so are claims that it is changing the face (and fundamental price) of our market.
The Chinese Dragon is Here to Stay
It’s true that the Chinese purchaser is aggressive and has a mindset of ‘needing’ to buy into Australian property, but I think this is borne out of their doubts they have in the Chinese regulatory and economic system. For what it’s worth, I don’t think this problem is going backwards. Although, it doesn’t yet add a valid percentage to our property prices, I’d be naive to think that that over time it wouldn’t. As the amount of buyers forming our ‘buying pyramid’ become more significant, the growth this can afford property might be distortive to normal market rules.
I don’t think this foreign investment currently is the problem other people think it is. I am delighted foreign investors are acknowledging the value of our property.
But we should at least have an FIRB awake to the conversation about how it is happening. Firstly, what is the point of the FIRB otherwise? Secondly, what about when it does become a problem.
The method of purchase by the Chinese market is via consortiums. They are the oldest, most unsophisticated and perhaps the most basic consortium that you could ever find - the family. These family ties aren’t the type of ties that can be broken with rules from an institution like the FIRB. My advice to Australia is to get used to it. The Chinese buyer is here to stay. My belief is that they are buying established property and there isn’t a law in the land that can stop it. My opinion is that I wouldn’t want a law that could!
GAVIN MCPHERSON is the CEO of <a href="https://www.oasisproperty.com.au/oasis-buyers/oasis-property-buyers.php" target="_blank">Oasis Property</a> and author of  <a href="https://oasispropertyinvesting.com.au/the-book.aspx" target="_blank">Value Investing in Property: What would Warren Buffet do if he was investing in property in Australia? </a>
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We have a problem with Chinese property buyers (but it's not what you think it is)

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GUEST OBSERVATION
One mistake many property investors make on their road to wealth is purchasing as many properties as they can, not taking into account location or price or, most importantly, land value.
But you don’t need to own multiple properties to be wealthy. You just need to make sure the ones you do own count – and of these properties, at least two should be what you refer to as your ‘core assets’.
The core asset properties in your portfolio are you staples; the ones you’ll keep for 10 years plus and will guarantee a significant growth over that period. They are not speculative; instead they are investments that are continuously increasing in value over that time frame.
It’s important to get this right from the start. These properties need to be in a 5km-10km radius of a major capital CBD, affordably priced with a high level of tenancy and high rental returns.
They need to be purchased at 5% to 10% below the market value to secure a return. I call this the ‘margin of safety’ when buying any investment property and it’s crucial for putting you in the right mindset for managing a portfolio with a positive outlook.
Buying fewer properties will also mean spending less on stamp duty and purchasing costs. I have always said that Governments are usually the big winners from real estate transactions, with removalists a very close second. But it doesn’t need to be that way!
Remember, we are just in this for the money, not for the purpose of saying you own multiple properties. What is important is your net worth; not your gross amount of properties.
Once you’ve purchased your first core asset, wait three years or more until you’ve built up enough equity to purchase another. It may be boring, but good investments usually are. Just remember, they have huge long term rewards.
How long till my property doubles?
A general rule of thumb exists in the investment world that property doubles every 7-10 years. While this is simplistically true, for those buying lemons or at the wrong time, nothing could be further from the truth. Did you know that:
<ul>
<li>Between 1960 – 1972, it took 12 years for to property to double</li>
<li>Between 1972 – 1975, it took 3 years for to property to double</li>
<li>Between 1975 – 1983, it took 8 years for to property to double</li>
<li>Between 1983 – 1988, it took 5 years for to property to double</li>
<li>Between 1988 – 2001, it took 13 years for to property to double</li>
<li>Between 2001 and 2013 – it took 12 years for property to double</li>
</ul>
Source: Value Investing in Property; What would Warren Buffett do if he was buying property in Australia? (Gavin McPherson)
So you can see that for those that bought wisely (say in 1972 or 1983) the purchase of one astute investment property could certainly reap far more rewards than 3 poorly timed ones! Not to mention the levies, taxes, stamp duties and maintenance along the way. 
Importantly, you will need to consider the location of the investment and how much land value is intrinsically within the land component. Do not assume capital growth without taking into consideration those key points.
Assuming returns of 10% and 11% year on year is unrealistic - you need to average your returns over 10 years and be as positive about your portfolio in bad years as you are in good.  Remember, property only needs to increase by 7% per annum to achieve this outcome.
Is it harder than it used to be?
Unfortunately above trend capital growth will get harder and harder in the future. The returns of the past will not be the returns of the future, but rewards can still be gained by following demographics; my secret pastime.
For those of you that already own some ‘dog’ properties, don’t despair. Just think, even if you purchase the worst property investment, it will come good over time with the power of inflation. You are certainly in a great market that will forgive al lot of your properties downsides. But for those that are about to purchase, imagine what will happen if you purchase well?
The strength of your portfolio should be built on the premise that you might only need to buy one great property to trade or keep as a core asset once every three years maximum.
Core Assets
By simply concentrating on fewer core assets most of the hard work is done. Investing isn’t meant to be difficult over the long term. In fact, it is designed to get easier.
Your ambition is to get wealthy, not to collect properties.  Most people I know who own ten or more properties are NOT wealthy. Of course, it isn’t for lack of trying. In fact, if I could summarise the activity of an active “collector” investor, I’d use the analogy of the “old lady who swallowed a fly.”  She chased one bad decision with another; and the result wasn’t good…  
Now I know there are plenty of peddlers determined to wrestle your wallets out of your pockets to have you buy multiple properties in a market like this. In fact, it’s almost perfect timing for these charlatans. 
Just remember that old lady!
Gavin McPherson is CEO of Oasis Property and bestselling author of Value Investing in Property, What Would Warren Buffet Do If He Was Buying Property in Australia?
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The key strategy to being a successful investor

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GUEST OBSERVATION
Property is one of the greatest investments for long-term wealth creation and there is no one that argues that point stronger than me!
However, as with any investment, there does come when a time when you need to re-evaluate your position and consider the timings of your options. And that time is now.
Last year I wrote an article about the affordability of housing and its impact on the Australian population. Within this, I detailed how historically we have a tendency to spend between 33% and 55% of our household income on property, giving an indication of the lengths we’re willing to go to in order to own and invest in property.
The current record house prices mixed with record low interest rates should, however, ring alarm bells. It might be a time to consider selling your property investments in order to secure a profit you might not see again for a very long time.  
Remember, I am a long term holder of property and don’t advocate selling if you don’t have to. But there are always exceptions. This is one such time.
So don’t jump onto the phone to the real estate agent just yet. Take a look my signs that can help you assess how the market is performing in your area.
<ol>
<li>
When Main Road Properties Sell Main road properties often leave many people stumped, asking themselves: ‘who would actually live on the side of a busy road like this?’ Think of the Pacific Highway in Sydney, Welshpool Road or the Great Eastern Highway in Perth and Monash Freeway in Melbourne, for example. All busy main roads, all with a smattering of houses dotted along the sides. Main roads have always been a source of very cheap land. Many people would prefer not to live on a main road and the only encouragement to buy there is because of the cheaper prices. There’s nothing wrong with that – pragmatic purchases and entry level home buyers always need a platform from which to dive into the market. But take a minute to think about the last time you drove down one of these roads and consider if there were a lot of ‘sold’ signs outside these houses. Is that the norm? Think about it. Normally there would be a lot of ‘for sale’ signs, and those signs would have been there for a good while – an estate agents little trick to have free branding for a long period of time! So if you do notice a lot of sold signs next time you drive down these roads, consider why. I’d bet they are the highest they’ve been since 2003 and that should tell you something about your local market and how it’s performing. If properties on main roads are selling, imagine what that means for properties elsewhere? 
</li>
<li>
When dog properties sell There are many properties out there that an investor wouldn’t even consider touching. Buyers agent’s like myself call them dogs. These normally have bad or non-existent natural light, are in a noisy area (such as close to an airport), have a bad strata management or are located in a less than desirable suburb. But there are many investors out there that own these types of properties. At the time they might have thought they were snapping up a bargain or perhaps they simply saw potential somewhere within it. But my advice to you would be to consider looking at how similar ‘dog’ properties are doing in the market? Are they selling? If they are, again - consider why this might be. Record low interest rates are encouraging people to snap up property left, right and centre so if you think you have one - sell up now! A little tip: If it’s in a state of disrepair describe it as a renovators delight, this immediately inspires potential buyers and it should fly out of the real estate window! 
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<li>When agents sell their houses</li>
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As a buyer’s agent, I often talk with estate agents about the state of the market. But I have never seen so many agents being so open in telling me that even they think the current market is ‘frothy’.
In the last three months I have witnessed 11 agents tell me they’re looking at selling their property, and then have gone and done it. None of those properties are still on the market and they’ve all sold for good prices.
Think about it another way. If there’s one thing estate agents do, it is to preserve their own interests. These agents aren’t waiting for the data to come out to confirm what they already know – they know a good market when they see one and use it to their advantage.
Oh and in case you’re wondering, I too have just sold my Sydney property – and I’ll start looking for a new one soon - when the time is right, but it’s definitely not now.
A final note: My comments targeted above are largely based on the Sydney and Melbourne market in the current climate. Please take note that there are many outer suburbs not yet in this position due to the delayed response of the ripple effect. Brisbane, for example, is well below its eventual peak which I predict will rise in 2015.
Gavin McPherson is CEO of <a href="https://www.oasisproperty.com.au" target="_blank">Oasis Property</a> and author of 'Value Investing in Property: What Would Warren Buffet Do If He Was Buying Property In Australia?'
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It's time: Three signs you should sell your investment property

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GUEST OBSERVATION
As a property investor there’s one key skill you will need for every transaction you make – the art of negotiation.
Nailing this skill is almost compulsory in your success at making a profit on every property that you buy, and ensuring that the purchases you make are never pointless ones.
Introductory tips on negotiating like a pro
First and foremost you need to determine the market you’re buying in. Try and purchase at the end/or during a spell of bad consumer sentiment, when the optimists are no longer running wild.
Remember, no one has become wealthy doing what everyone else does, so your challenge is to think for yourself and ask: “why will this time be any different from the last?”
Once you’ve found a property: Let the games begin
You must start your negotiation from a position of strength, so you need to do your research.
Learn the market and assess the value of the property, remembering that the profitability comes from the land component. Before you pick up the phone to the agent, come to grips fully with the price. Seeing over 2000 transactions in my office over the past decade has given me a radar that can get within 1-2% of a property’s value, but you can get this with your own with various tools - including databases, auction attendances and seeing properties first hand.
Walking Away
If the property seems way too expensive it probably is, so walk away.  As few properties as there currently are on the market there will always be another and, most importantly, it will be for the right price.
Don’t attend auctions
For investors, if the property is going up for auction then don’t attend. There isn’t a deal to be done in an auction environment that doesn’t have the vendor popping champagne! The definition of buying a property at auction is ‘paying what the vendor wants on the day’.  I have attended and bought significantly reduced price property at auctions, but these times are few and far between and certainly not while we live in a world of record low interest rates. So take my advice and keep clear!
Negotiation starts when you pick up the phone
Once you’ve found a property in a good location that is not overpriced and not up for auction, it’s time to pick up the phone! When you first reach out to a sales agent always tell them you’re an investor, not a home buyer.
The reason for this is simple – by telling them you’re an investor they’re more likely to sell you the property because you might use them for rental management, providing more business.
It also shows that you are only interested in buying it for a price and they don’t have to entice you into falling in love with the home!
Act nonchalant
Always act nonchalant. You want them to think you’re not that bothered if you get the property – then ask them for a discount upfront.
You want them to know you’re only interested in the property at a certain price - after all, you are an investor! Why waste time you could be spending doing more research if you can’t even afford it?
Low-balling is a terrible tactic in bull markets
When negotiating avoid the logic ‘always offer 15% under the asking price’. Don’t follow this as a rule. If it was that simple, agents would just ask for 20% higher and still be 5% in front!
Keep in mind agents are experts at selling property not experts in investing – but you are an expert in investing.
Ask for the contract
Ask the agent for the contract up front before the viewing. Firstly, it won’t pique the interest of other potential buyers if you ask for it in front of them, and secondly, it can allow you to compare better sales data and analysis on the value of the home - including easements, potential for pools, and the all important neighbouring properties.
Once you’ve completed the viewing and are happy with what you see, the real negotiating can begin…
Make the offer
One of the best tactics I’ve learnt for negotiating like a pro is to simply put an offer on the table straight away.
You have the contract already, so then and there write down your offer and hand it to the agent. You’re in a position of power now, the agent knows that this is the only price you’re going to pay and has to go to their vendor to ask them to consider it.
Timing is very important in this. In general, earlier is better and I have won many properties by forcing the hand of an agent on a Saturday after inspection.   
Just remember, practice makes perfect – so test it out on some dud properties you’re not interested in first and then try it for real. Just keep thinking the line the entire time, ‘I am happy to walk away from this property’. It is a great position to be in.
Gavin McPherson is the CEO of Oasis Property and author of  Value Investing in Property: What would Warren Buffet do if he was investing in property in Australia? 
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The subtle art of negotiation

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For well over a decade I have been grappling with property markets consistently showing us the increased performance of concentrated inner urban areas, particularly those that are in a close proximity to the CBDs of our major Australian cities.  
But there’s really no point fighting against it. The fact is, CBDs are the highest performing areas, and that makes them the key areas for investors.  
When looking at investing in your first, second or hundredth property, the location is always the most important factor to take into account, and there’s always going to be an element of risk when making that decision. The whole notion of investing applies an assessment of risk, but I would argue that that risk is mitigated by investing in areas which have robust employment, infrastructure and lifestyle choices.  
Mining towns may seem like the prime area to make a profit, but there’s no promise that these areas will still be populated and have a reliable stream of tenants in 10 or 15 years’ time. But in our inner cities, you know that this will always be the case – and that’s a fact!  
The buyer’s agents in my business specifically look for properties within a five-10 kilometres perimeter of the CBD. The reason for this? People will always cluster where trade and commerce present themselves.
Cities form around landscape and natural bounties such as beautiful harbours and inlets, they’re nice places to live and people are social and community-based creatures - they relish in living near the action. In fact, the old cities around the world show how communities of all racial, cultural and religious backgrounds thrive in these cities.  
This very phenomenon has been played out across the world, city after city, on every single continent in the world and is our key to success. It is your guarantee that we too will populate our cities in exactly the same way as places like London, New York and Shanghai.  
The land in capital cities will always be an asset that will grow in demand.  
At present, I stick to the top six cities in Australia in order of population:  
1). Sydney
2). Melbourne
3). Brisbane
4). Perth
5). Adelaide
6). Gold Coast  
I usually recommend heading for Sydney or Melbourne to consolidate the core purchasing strategy. Australia is now one of the most urbanised countries in the world, with 89% of our population living in urban centres and investing in these areas will almost definitely offer you the most upside to your 10–15 year plan.
Go where the land is scarce and, once you’ve decided on your area, ask yourself the following questions before purchasing.
a). Where is the employment centre of the city?
b). Is there a diversity of employment in this region?
c.) What is the history of this employment, i.e. does it ebb and flow or is it historically always strong?
d). Can I buy close to good infrastructure, or if the citizens of a city are better serviced elsewhere, what is stopping them from leaving?
e). What is the history of infrastructure in this city? I.e. how has the government [state and local] achieved the objectives set by its citizens over a good (minimum 15 years) period of time?  
Once you know these answers, you’ll know if you’re in an area that will grow and thrive – and your property will grow and thrive with it. A safe bet for anyone entering, or well experienced, in property investing.  
 
<hr>
 Gavin McPherson is the CEO of <a target="_blank" href="https://www.oasisproperty.com.au/oasis-buyers/oasis-property-buyers.php">Oasis Property</a> and author of "Value Investing in Property: What would Warren Buffet do if he was investing in property in Australia?"
 
 
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Some things never change; inner city investment is the best bet: Gavin McPherson

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The negatively-geared seminar is usually the first type of seminar I see people attend when they become interested in wealth or property investment. Sometimes, people just attend out of curiosity.
From the outset I need to explain, I am a big fan of negative gearing. However the point I need to make is not about negative gearing itself but the product that the promoters are actually trying to sell.
Usually the presentation or pitch opens with something like:
• Are you sick of ‘working for the man’?
• Then the presenter will show some figure that makes it look like that almost 90%+ of people retire on less than approximately $30,000.
• They will then demonstrate that with the tax you currently pay to the government, you could be funding your future! They often use analogies such as “Did you know you currently work Monday, Tuesday and part of Wednesday of each week before you start making money for yourself?”
It’s no more than an attempt to get your interest by bringing your attention to the tax you pay as a problem that needs to be addressed.
• Then they begin to show you the ins and outs of tax offset allowances that the government permits under negative gearing rules. These are the ‘upside’ of the making losses on a property on a month to month basis (mortgages, levies, outgoings, etc).
Once you’ve understood negative gearing
It’s not the notion of negative gearing itself that I have a problem with. But pay attention to the fact that the real reason these people are here, talking to investors in their seminar room, is that they are trying to sell you something.
And guess what, wow, aren’t you lucky, can you believe it? In the nick of time right after they just finished their amazing seminar telling you how much tax they could save you, they also just happened to have the perfect investment property for you as well! Aren’t you lucky? Hardly.
I have been to some fancy shindigs on the back of a negatively-geared property presentation. Some served sandwiches, some served caviar, but the reality is that all of them are serving up the same unbelievably overpriced property. All of them. No exceptions. If anyone can contact me and identify a property at one of these seminars that is great buying and I can’t find 10 better in just one day’s work, I’ll buy the damn property. How’s that for a guarantee?
Research my a$&amp;e!
These people will carry on about how well researched the property investment they have found for you is. They might even pretend to have full-time investment analysts! The reality is, the only analysing these analysts are doing is scoping out which developments they can get access to where they can get generous kickbacks from the developers. Of course, that’s on top of whatever else they might have charged you!
Kickbacks [the property mafia, with their hand in your pocket!]
These kickbacks usually fall into the tens of thousands. For a $300,000 to $400,000 property, they are usually overpriced by between $30,000 and $50,000 to begin with, and this is just for starters.
Example: When the west was booming, I had an email sent to me from a developer for a kickback of $150,000 paid to anyone who could refer them a buyer. Of course, my job description does not permit me to take a kickback. The property was selling for $800,000 and on closer inspection it was laced with profit for the developer. It was just a shame there was nothing for the investor!
Like the example above, this margin is usually significant. Often these spruikers are tied up with the developers who have taken the property from its concept stage. They will tell you that they have the ability to ‘bulk buy’ to give value back to you. In almost 100% of cases this is not correct. They deliver the bulk-buying discount to themselves. This is usually only evident when the properties sell for $50–100k less some 5–7 years later. There are some tragic stories about people losing their life savings over these ‘scams’ – and I do emphasise the word scam. Google the name Henry Kaye and see where that takes you.
 
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Big business
This form of investment and development sales is now a huge industry, and getting bigger, with the huge infusion of investment dollars from China and the Asia-Pacific. The problem is that some of these consortiums are now so huge (and clandestine, with channels through your accountant, financial planners and advisors) that they are looking for local targets as well, and that means you!
Their presentations are becoming more polished year after year. But it doesn’t change the product they are trying to sell. It’s exactly the same.
Right now, you might be confused because I haven’t told you exactly why they are such bad investments. I have only said that they are overpriced. You might think that a ‘discount’ might all of a sudden make them acceptable. Hold that thought and read on. I haven’t finished.
Tip
Only today while penning this chapter, I have a client of mine I recently purchased for [a unit in Sydney] who is sourcing finance for a property he purchased ‘off the plan’ in 2010 for $301,000, before I had met him. A finance valuation was completed in July 2012 and it came in at $230,000. This represents a 30% premium paid for the property in 2010. For those of you ‘off the planners’ who expect the property to increase over two years, have you considered that it could possibly go down! Let me give you a tip, it didn’t go down to $230,000, it was never worth $301,000 to begin with!
Good idea — but from the wrong source
As mentioned, negative gearing is a great strategy and one almost all my clients use … but buying a property through a person or company who taught you the concept of negative gearing is destined for failure.
Worse still, many people who peddle this product call themselves ‘buyer’s agents’, making you think they are acting for you. They are not. I am a true buyer’s agent and I take exception to these charlatans. I don’t have any affiliations with developers, accountants, financial planners, anyone in fact, when I recommend a property, I simply choose the best one for the client. And isn’t it remarkable that it is never a property sourced from one of these pretenders. They are not property experts and they will never make you wealthy. In fact, you’d be hard pressed just trying to avoid a loss over a 7–10 year period.
In the industry they are also called ‘two tier marketing’ (or multi-tier) companies. After recommending you a property development, these people often recommend the solicitor, the mortgage broker and the accountants – all of them on the take. I don’t want to get into the legality of these scams (although I do think many of them skirt the law on a daily basis), because in the end, it is your money. You are entitled to lose it any way you want to. If you are going to buy one of these rip offs regardless, at least save yourself $30 and don’t buy my book. (Apologies if you’ve paid for it already.)
But I know you’re not reading my book to lose money. You haven’t forgotten Warren Buffett’s first rule yet have you?
Rule No. 1: Don’t lose money. Rule No. 2: Don’t forget Rule No. 1.
Unlike the poor suckers attending the seminars who seem to be ready to give their life savings to the first person to walk into the room in a Hugo Boss suit, I train my client investors to be:
• Interested (yet sceptical)
• Motivated (yet patient)
• Difficult to impress (not easy to impress)
• Keen to learn (but careful to decide) and
• Experienced!
These are the characteristics that you need to start to develop. In fact, scepticism, patience (and discipline), difficult to impress and careful to decide will lead to experience, and this after all is your end goal.
Gavin McPherson is the chief executive of <a href="https://www.oasisproperty.com.au/" target="_blank" rel="nofollow">Oasis Property Group</a>. His book, 'Value Investing in Property - What would Warren Buffet do if he was buying property in Australia?', takes aim at the get rich quick property experts and explains instead the sturdy path to wealth through value investing in property.
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Negative gearing can be useful but beware spruikers: Gavin McPherson

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There are a lot of conflicting views about this so-called ‘new’ property market cycle.
Has the 2013 budget made it worse? Will it turn a corner after the election? If buyers think this will be the last chance to get into the property market before it becomes totally unaffordable, don’t be fooled; it’s not.
For the major cities in Australia it’s true that the housing supply problem will always ensure that there will be ready and willing buyers. But are they able buyers? That is, are they able to stump up a deposit?
Being able to pay the mortgage at today’s rates isn’t really the challenge. It’s being able to keep up repayments when things return to normal.
For instance, let’s take the average Sydney home price at approximately $650,000. At more normal 7% interest rates, that’s $45,500 per annum (after tax) to pay just in interest on the mortgage. Not only is this huge, but it’s also about the point some years ago where new buyers said “that’s enough, I’m out!” In other words, those who can afford property still have their limits.
Now with rates at historic RBA lows, the (variable) rate is currently 5.4%. This takes repayments down to $35,100 – almost 23% less (after tax) for the same mortgage – even less if they want to lock it in for a few years. So let’s say that those same buyers (who could afford 7% rates) bid the price of that average $650,000 up by 23% making it $799,500.
Is that really possible? You bet it is.
But this isn’t the problem; those lucky buyers getting into the market now (paying $650,000) with a great low interest rate will probably be the winners right now.
But what about the buyer who ends up paying $799,500 for that same property in, say, November 2014? How do they fare when rates return to normal again? Imagine $799,500 at 7%, with repayments of $55,965 - some $20,000 more than the lucky purchaser who locked in three-year rates in June 2013 at $660,000.
Keeping in mind the infamous phrase: “Confidence enters the room one person at a time. Fear exits the room all at once”. That sort of event usually leaves some double-digit price drops behind it.
And for those that don’t think that rates will return to normal? Check your history. They will. For those looking to cash in on the current low interest rates, here are just a few tips to help you through the next market cycle unscathed.
1) Buy under market value by 5-10%: Always go into a deal buying the property some 5-10% under market valuation. I adopt this as my number one rule in every purchase I make; Warren Buffet dub’s this his ‘margin of safety’. In the property industry I find the first and easiest way to do this is to avoid buying at auctions. When bidding at auctions, you will usually bebidding against owner occupiers rather than investors, making the property a personal (and emotional) acquisition to them – and making it nearly impossible for you to get a good deal. I buy over $100m of property a year and I’d say less than 1% of it is at auction. So much so that an auction campaign rarely gets my attention at all!
2) Keep debt low: As tempting as it is, now is not necessarily a good time to commit to high debt for the long term. We still don't know how this market will play out, and if the recent federal budget is any indication, all signs are pointing to higher unemployment, anaemic growth and little in the way of surplus cash going forward.
3) Fundamentals are... well, fundamental: While a good investor will never ignore good property fundamentals, this is especially relevant now. Remembering that at times like this every property can increase in value, even if they have deficiencies such as poor land value, main road status or no natural light. When things normalise however, bad properties will be punished.
4) Go North: For investors I'd be looking at major cities that are undervalued like Brisbane and the Gold Coast. I believe Melbourne was in a prolonged state of plateau before the rate decrease, so I don't see a lot of movement except for some ‘topping up’ of that affordability threshold. Sydney has further room to grow organically but it is limited by a high threshold that pushes affordability up – as seen in my earlier example. In fact, most of my tips for above par growth will be north of the NSW border for the medium term (2-4 years).
5) Read and learn. The investor of the future understands that property is just one piece in a jigsaw. That jigsaw also includes factors such as the greenback, parity, quantitative easing, terms of trade and yes you guessed it, China. So while you don’t necessarily need an economics or geopolitics degree (although it is handy), you would be well advised to start reading something that will get you thinking about the long term.
6) Think long-term. The final piece of advice could well be your best at times like this.
For any of you that think you can make your first million in just one market uptick, while interest rates are at record lows, you might just be setting the trap for your own personal armageddon – because I don’t think judgement day (i.e. higher interest rates) is that far away! In case you need some more positive inspiration though, I’ll let Mr Buffett sum up these thoughts better than I can: “Wealth is the transfer of money from the impatient to the patient.”
Gavin McPherson is the chief executive of <a href="https://www.oasisproperty.com.au/" target="_blank">Oasis Property Group</a>. His book, 'Value Investing in Property - What would Warren Buffet do if he was buying property in Australia?', takes aim at the get rich quick property experts and explains instead the sturdy path to wealth through value investing in property.
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Six tips to help you through the next market cycle unscathed: Gavin McPherson

S&amp;S Projects is boosting its investment at Rainbow Bay to more than $1 billion after the prolific Gold Coast developer acquired a new site for $20.25 million and immediately laid plans for a new luxury apartment project in the sought-after precinct.

The site, which is the company’s fifth acquisition at Rainbow Bay in the past four years, will be home to the company’s largest project to date after delivering 3 sold-out projects and construction progresses on Radia worth a combined $215m. 
S&amp;S Projects is currently finalising plans for its latest strategic acquisition, a 1,518 sqm site located 209-213 Boundary Street in Coolangatta, with a development application expected to be lodged within weeks.

The luxury residential development will build on the company’s highly successful projects at Rainbow Bay, comprising Flow, Awaken, Esprit and Radia, with Radia currently under construction by Hutchinson Builders.

“We have been unflinching in our commitment to Rainbow Bay and the transformation we have helped drive in this incredible part of the Gold Coast, which is among the city’s most desirable residential locations,” said S&amp;S Projects founder and director Paul Gedoun.

“Our fifth project will reflect the best of what we have done so far to create a lifestyle precinct that is second to none.”

The latest development, which has yet to be named, is proposed to accommodate 88 luxury apartments in a design that will immerse residents in a unique wellness lifestyle that expands on the legacy of S&amp;S Project’s earlier developments at Rainbow Bay.

The development will feature an expansive rooftop garden and wellness centre with a resort- style pool, among a host of lifestyle amenities planned for residents.

“Rainbow Bay, with its beautiful, protected beach and alongside one of the world’s best surf breaks at Snapper Rocks, is the natural wellness heartland of the Gold Coast,” said Gedoun.

“We are taking every advantage to create a truly unique rooftop wellness experience with a natural feel for residents, offering stone features throughout and an underlying theme that emulates a botanical garden.”

The latest acquisition comes as S&amp;S Projects is at the completion of Esprit and construction continues on Radia, which are part of their significant portfolio undertaken by the company at Rainbow Bay since 2022.

The $215 million Radia, which comprises 38 apartments, is currently the flagship development by S&amp;S Projects at Rainbow Bay which is expected to be completed in 2027.

Jayde Pezet, of Pezet Matheson, which has managed sales and marketing for S&amp;S Projects across their Gold Coast portfolio, emphasised the developer’s commitment to continuous improvement and excellence.

“S&amp;S Projects continue to elevate the benchmark of luxury with each development," Pezet said.

“We have worked with S&amp;amp;S on their 4 other projects in Rainbow Bay and their approach reflects a team that is constantly learning, refining, and pushing the standard higher.

“Their hyper-local knowledge and deep expertise within the luxury property sector are what truly set them apart, allowing them to deliver projects that feel both globally sophisticated and authentically connected to their coastal environment”

S&amp;S Projects plans to officially launch its latest project at Rainbow Bay in the second half of this year.

“As we embark on our largest project yet, we have pulled out all stops to create another landmark development that truly reflects the relaxed southern Gold Coast lifestyle,” Gedoun added.

Joel Robinson

S&S buys $20m Rainbow Bay site for fifth beachside apartment project

Japandi, an emerging design trend that combines Scandinavian functionality with Japanese rustic minimalism, remains relatively untested in Australia’s residential development market.

As developers look to differentiate their projects and offer something distinct to buyers, Brisbane-based developer Lantona has embraced the hybrid style for its recently launched Toowong apartment project, <a href="https://www.apartments.com.au/new-apartments/koya-residences-6-josling-street-toowong-qld-4066">Koya Residences</a>, with early response to the design proving positive.

Lantona entrusted Red Door Architecture and interiors practice Luma Design Co with delivering the Japandi brief. The approach blends Japanese minimalism with Scandinavian functionality, emphasising warm, restrained interiors, natural materials and clean lines. Drawing on the Japanese concept of wabi-sabi (beauty in imperfection) and the Scandinavian principle of hygge (comfort and cosiness), it creates serene, uncluttered and sustainable living environments.

These design principles are expressed throughout the Josling Street development, both in its exterior form and across the 40 one-, two- and three-bedroom residences within.

[smartcode_project:default project_id=150787 project_image_fid=366229]

Koya reflects a deliberately scaled approach, with the five-storey form designed to align with the surrounding residential streetscape rather than dominate it.

“Koya is conceived as a building that sits comfortably within its surroundings. Every decision, from material selection to spatial planning, has been guided by long-term liveability and enduring relevance,” the developer said.

[smartcode_project:default project_id=150787 project_image_fid=366243]

Positioned within an established inner-west neighbourhood, the development sits near riverfront parklands and the Bicentennial Bikeway, while remaining within walking distance of Toowong Village and multiple public transport options connecting to the CBD, St Lucia and West End.

Lantona said the location was central to the project’s conception, pointing to Toowong’s balance of green space, transport access and proximity to major education institutions.

“<a href="https://www.apartments.com.au/developments/toowong-qld-4066">Toowong</a> combines river access, walkability, immediate CBD connection and a strong educational presence. That balance made it the obvious setting for Koya.”

[smartcode_project:default project_id=150787 project_image_fid=366230]

Communal amenity is concentrated on the rooftop, where a shared retreat will include a pool, dining areas and outdoor spaces oriented towards neighbourhood and city views. The design allows for both private use and small gatherings, extending the living environment beyond individual apartments.

Koya enters the market at a time when smaller-scale developments are becoming less common in established suburbs, with many recent projects in the suburb shooting for the sky.

In a nod of confidence,&nbsp;<a href="https://www.apartments.com.au/builders/brisbane-builders">Brisbane Builders</a>&nbsp;has already commenced construction on the building, which is slated for completion in early 2027. Keenan &amp; Byrne is marketing Koya.

[smartcode_project_cta:default project_id=150787]

Japandi-inspired Koya Residences launch in Toowong

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A completed Castle Hill apartment development is returning to market with an uncommon level of financial backing, positioning it as one of the more secure options for buyers in Sydney’s north-west.

Skyview in Castle Hill, originally developed by Top Place and now overseen by capital partner <a href="https://www.apartments.com.au/developers/equitifund-group">Equitifund</a>, is being relaunched following a full remediation process. Central to its repositioning is a substantial financial reserve designed to provide ongoing protection and reduce uncertainty for incoming purchasers.

At the core of this offering is an $11 million bond secured during the project’s remediation phase, negotiated by former NSW Building Commissioner David Chandler. With less than $4 million required to complete the works, approximately $7.2 million remains in reserve, with around 15 years left on the term.

[smartcode_project:default project_id=147685 project_image_fid=359134]

Rather than a typical insurance-backed structure, the remaining funds are held as cash, creating a readily accessible financial buffer should any future building issues arise. The structure is intended to provide buyers with an added layer of certainty, differentiating the development from more conventional apartment offerings.

Equitifund Executive Chairman Greg Huxley said the structure provides a level of security not typically seen in apartment developments.

“The $11 million bond established for the Skyview Castle Hill development represents exceptional value, providing genuine financial security for purchasers,” Huxley said.

“Unlike a standard insurance policy, this bond consists of real funds held in trust for the Owners Corporation, offering a tangible layer of protection and added peace of mind.”

[smartcode_project:default project_id=147685 project_image_fid=359135]

The remediation process has now been completed in full, with no active rectification orders or outstanding directives linked to the project on NSW Government registers. This outcome reflects the broader tightening of building oversight across the state, while also highlighting the project’s transition into a completed, compliant asset.

In a market where many buyers remain cautious about apartment quality, initiatives like this are designed to restore confidence, giving purchasers greater certainty and a stronger sense of security in their investment.

Equitifund has since acquired the remaining apartments and is managing their reintroduction to the market. With the works finalised and a significant financial reserve in place, the project now presents with a markedly different risk profile compared to its initial release.

[smartcode_project:default project_id=147685 project_image_fid=359137]

Beyond the added security, the development is positioned in one of Castle Hill’s more established pockets. The Gay Street address places it within close proximity to Castle Towers, one of the country’s largest retail centres, as well as Castle Hill Metro Station, which now connects directly to the broader Sydney Metro network.

Equitifund National Sales Director Ben Hamblett said buyer demand in the area continues to be driven by access to transport and amenity.

“Interest from both owner-occupiers and investors in Castle Hill remains exceptionally strong, with buyers consistently prioritising developments in close proximity to the Metro station and Castle Towers Shopping Centre,” Hamblett said.

“There is a clear trend in the market, with purchasers seeking convenient access to transport and lifestyle amenities that support a seamless, low-maintenance way of living.”

[smartcode_project:default project_id=147685 project_image_fid=359145]

The apartments also enter the market at a relatively accessible price point for the area, with two-bedroom configurations starting from $995,000 and rental demand for similar stock reaching around $900 per week. This combination of pricing, connectivity, and completed status is expected to appeal to both owner-occupiers and investors seeking lower-risk entry into the Hills District apartment market.

For eligible buyers, a limited 3.50 per cent p.a. two-year fixed interest rate is currently available through Equitifund’s lending partners, providing an additional layer of affordability.

EquitiCredit Pty Ltd ACN 676 363 769 holds ACL 559289 and provides credit assistance. Finance is arranged through EquitiCredit and funded by its lending partners. Interest rates are subject to change and eligibility criteria apply. Terms, conditions, fees and charges may apply. This is not financial advice and should not be relied upon as such. Prospective buyers should seek independent financial advice.

[smartcode_project_cta:default project_id=147685]
</section>

Castle Hill apartments offering unmatched buyer protection through dedicated fund

A State-Assessed Rezoning Proposal for the Kurnell Peninsula is now on public exhibition, setting out a plan to deliver up to 4,300 homes alongside new retail, tourism and public open space on a 210-hectare coastal site.

The proposal, backed by the Minns Labor Government, would transform a former sand mining area along Captain Cook Drive into a mixed-use precinct delivered over approximately 20 years.

In addition to housing, the plan includes more than 7,000 sqm of retail and commercial space, new community facilities and approximately 116 hectares of open space, equating to more than half the site.

<img alt="Kurnell" data-entity-type="file" data-entity-uuid="ce1c6567-1df0-4de0-9fe5-a76be0367834" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-04-13%20at%209.11.51%E2%80%AFAM_0.png?VersionId=dbbTmYaJvROA5fkQbgaxis8cmFwtpB5_" />

<hr data-end="849" data-start="846" />
<h2 data-end="902" data-section-id="ony3l3" data-start="851">Rezoning framework enables mixed-use development</h2>

The rezoning application seeks to amend planning controls under the State Environmental Planning Policy (Precincts—Central River City) and the Sutherland Shire Local Environmental Plan 2015.

Its primary objective is to enable a broader range of land uses across the site, including residential, employment, tourism and community uses, while also formalising environmental protections and land management outcomes .

The proposal has progressed through the state-led rezoning pathway after being identified as a project of regional significance, supported by several years of technical studies and agency consultation .

Development would occur in stages, aligned with the progressive closure and remediation of the existing sand mine.

<hr data-end="1718" data-start="1715" />
<h2 data-end="1768" data-section-id="krwii9" data-start="1720">Master plan structured around three precincts</h2>

The accompanying urban design report outlines an indicative master plan that divides the site into three primary precincts, anchored by a town centre in the western portion of the site.

The town centre is planned as the first stage of development, located on land that has already been remediated. It is intended to accommodate higher-density housing, retail, and community uses.

<img alt="Kurnell" data-entity-type="file" data-entity-uuid="4bfd5873-4847-4105-b220-0a30c96f5573" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-04-13%20at%209.20.09%E2%80%AFAM.png?VersionId=7aVaSsZLAc6mElSH4g6Ct5bGsNxZcnPL" />

Additional precincts extend toward Bate Bay and Boat Harbour, with built form responding to environmental conditions and proximity to the coastline.

The design framework identifies distinct local character areas, with the master plan structured to reflect “unique natural qualities” across the site.

<hr data-end="2495" data-start="2492" />
<h2 data-end="2544" data-section-id="1vitwqn" data-start="2497">Open space forms core of the design approach</h2>

A key component of the proposal is the allocation of approximately 116 hectares to open space and ecological land.

This includes:

<ul data-end="2846" data-start="2678">
	<li data-end="2702" data-section-id="d96caj" data-start="2678">Three district parks</li>
	<li data-end="2723" data-section-id="17y6uz6" data-start="2703">Nine local parks</li>
	<li data-end="2741" data-section-id="14hui00" data-start="2724">Sports fields</li>
	<li data-end="2778" data-section-id="ts7psx" data-start="2742">Coastal and ecological corridors</li>
	<li data-end="2846" data-section-id="agduax" data-start="2779">Two kilometres of publicly accessible beachfront along Bate Bay</li>
</ul>

The urban design report positions this open space network as central to the structure of the development, rather than ancillary to it.

It is intended to support ecological regeneration, provide recreational amenity and create a connected network across the peninsula.

The plan includes north–south ecological corridors, expanded wetland systems and pedestrian and cycling links designed to connect residential areas to the coastline and open space areas .

<hr data-end="3347" data-start="3344" />
<h2 data-end="3381" data-section-id="ql66rt" data-start="3349">Housing mix and affordability</h2>

The proposal includes approximately 4,300 dwellings across a range of housing types.

This includes high-density apartments, medium-density housing, townhouses and seniors housing.

Affordable housing provision is identified at approximately 240 dwellings, alongside a smaller component of social housing.

The master plan emphasises housing diversity, with the intent of accommodating a range of household types and age groups within the development.

<img alt="Kurnell" data-entity-type="file" data-entity-uuid="d4baba4d-b5b0-4a86-bcad-5d319b036184" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-04-13%20at%209.11.59%E2%80%AFAM.png?VersionId=udYFz0q8tjEPR3pmKLHRSFRJN4dKakPO" />

<hr data-end="3877" data-start="3874" />
<h2 data-end="3919" data-section-id="rgckdv" data-start="3879">Built form controls and height limits</h2>

Proposed building heights across the site range from three to 12 storeys.

These controls are set out within the rezoning application and are intended to manage visual impact, maintain view corridors and ensure compatibility with the coastal landscape.

Floor space ratios and height limits are applied across different parts of the site to reflect varying environmental conditions and proximity to open space and the coastline .

Higher density is generally concentrated within the town centre, with lower-scale development toward the coastal edge and environmentally sensitive areas.

<hr data-end="4548" data-start="4545" />
<h2 data-end="4588" data-section-id="1minlda" data-start="4550">Retail, tourism and employment uses</h2>

In addition to residential development, the proposal includes retail, commercial and tourism uses.

This includes:

<ul data-end="4896" data-start="4706">
	<li data-end="4775" data-section-id="1jrun76" data-start="4706">Approximately 7,000–9,800sqm of retail and commercial floor space</li>
	<li data-end="4803" data-section-id="10kyifw" data-start="4776">A full-line supermarket</li>
	<li data-end="4830" data-section-id="fz1hdg" data-start="4804">Food and beverage uses</li>
	<li data-end="4896" data-section-id="1aqg2fj" data-start="4831">Tourism accommodation, including hotel and short-stay options</li>
</ul>

The proposal also identifies employment outcomes, with the development expected to support jobs both during construction and in ongoing operations.

These uses are concentrated within the town centre and key activity areas across the site.

<hr data-end="5142" data-start="5139" />
<h2 data-end="5172" data-section-id="162x2kt" data-start="5144">Infrastructure and access</h2>

The proposal includes upgrades to Captain Cook Drive, which provides the primary access to the peninsula.

These upgrades are intended to improve traffic flow and support emergency access.

The transport strategy also incorporates:

<ul data-end="5529" data-start="5407">
	<li data-end="5433" data-section-id="fanquy" data-start="5407">Internal road networks</li>
	<li data-end="5469" data-section-id="o6y80y" data-start="5434">Walking and cycling connections</li>
	<li data-end="5529" data-section-id="jgraft" data-start="5470">Proposed public transport routes and bus stop locations</li>
</ul>

The rezoning report includes detailed analysis of transport, flooding, and infrastructure requirements to support the staged development of the site .

<hr data-end="5723" data-start="5720" />
<h2 data-end="5769" data-section-id="14urh3" data-start="5725">Environmental and cultural considerations</h2>

The site is identified as having environmental and cultural significance, including areas of ecological value and Aboriginal archaeological sensitivity.

The proposal includes measures to protect and enhance these areas, including:

<ul data-end="6230" data-start="6004">
	<li data-end="6056" data-section-id="1pzyouo" data-start="6004">Retention and regeneration of coastal vegetation</li>
	<li data-end="6100" data-section-id="bjn2vz" data-start="6057">Strengthening of biodiversity corridors</li>
	<li data-end="6148" data-section-id="1bpeyoj" data-start="6101">Protection of riparian systems and wetlands</li>
	<li data-end="6230" data-section-id="lg0cka" data-start="6149">Integration of cultural interpretation and recognition of Indigenous heritage</li>
</ul>

The urban design report also outlines opportunities for incorporating Indigenous cultural elements into public spaces and landscape design.

<hr data-end="6893" data-start="6890" />
<h2 data-end="6908" data-section-id="w7rk5f" data-start="6895">Next steps</h2>

The proposal is currently on public exhibition, with submissions open to the community. Feedback received during this period will inform the Department of Planning’s assessment of the rezoning.

If approved, the rezoning would establish the planning framework for future development applications across the site.

<hr data-end="6893" data-start="6890" />
<h2 data-end="6908" data-section-id="w7rk5f" data-start="6895">What the NSW Government says</h2>

Minister for Planning and Public Spaces Paul Scully said the planned closure of the sand mine and remediation of the Kurnell Peninsula presents an exciting opportunity to transform the area.

“This proposal envisions a vibrant new beachfront community with thousands of new homes, jobs and great open space in the Sutherland Shire. I encourage the community to have their say during the public exhibition period. Feedback from the community will play an important role in the assessment of the proposal.”

Sydney's newest beachfront city: NSW Gov to unlock 4,300 new homes on Kurnell peninsula

A long-awaited transformation of a former industrial site in Holroyd has been given the green light, with the NSW Government approving the $1.2 billion Crescent Parklands masterplan that will deliver more than 1,200 new homes just south of Parramatta.

The State Significant Development approval clears the way for a large-scale mixed-use precinct at <a href="https://www.apartments.com.au/new-apartments/1-crescent-street-holroyd-nsw-2142">1 Crescent Street</a>, replacing an underutilised site with a coordinated residential community anchored by new open space, retail, and commercial uses.

Designed by <a href="https://www.apartments.com.au/architects/woods-bagot">Woods Bagot</a> for WA-based developer Tiberius, the approved scheme comprises seven buildings arranged across two precincts. In total, the development will deliver 1,227 apartments, including 201 allocated as affordable housing, alongside approximately 2,500 sqm of retail and 5,000 sqm of commercial space within a mixed-use podium.

<img alt="Tiberius’ Crescent Parklands to deliver 1,200+ homes in major Holroyd transformation" data-entity-type="file" data-entity-uuid="1cc82dd2-8184-4b86-8665-90653147820d" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Crescent%20buildings.png?VersionId=2ZmVDc_Rfc4AzQ6ShzZJlvdZnACLerVM" />

The project is structured as a masterplanned precinct rather than a standalone tower. Buildings 1 to 4 will rise from a shared podium with shop-top housing, while Buildings 5 to 7 are positioned closer to the northern park interface as residential flat buildings. The built form has been carefully modulated to balance density with amenity, with the design resolving building separation, solar access, and wind impacts at a precinct scale.

A significant focus of the design is the activation of Crescent Street and the integration of public domain. The submission notes that “individual townhouses [were] removed for community based functions to Crescent Street to increase activation and surveillance,” reinforcing a more urban and publicly engaged street edge. Retail, commercial tenancies, and resident amenity spaces are concentrated along this frontage and within the podium to support day-to-day activity.

The landscape strategy underpins the project’s identity, with a network of pedestrian connections, landscaped corridors, and open spaces linking the site internally and to its surroundings. The design prioritises permeability, delivering “increased uninterrupted flow between spaces for pedestrian access” and improved connections through to the adjoining parklands.

<img alt="Tiberius’ Crescent Parklands to deliver 1,200+ homes in major Holroyd transformation" data-entity-type="file" data-entity-uuid="19282454-ab2f-4e2c-866f-4b35cf4283d4" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Crescent%20masterplan.png?VersionId=JQdWGYI5B5R1lzmK4omYOp_8KLPkT4Bv" />

Buildings within the western precinct are oriented toward the park, shaping a residential offering defined by proximity to open space. The design describes this approach as creating apartments “immersed in nature with apartments facing the park,” positioning the landscape as a central organising element of the masterplan.

The broader architectural response addresses both infrastructure and context, with taller elements capturing long-range views toward Parramatta while setbacks and separation distances mitigate impacts on surrounding residential areas. Sustainability initiatives, including solar optimisation, cross-ventilation, and integrated landscape systems, are embedded across the scheme.

Located approximately one kilometre south of Parramatta CBD, the 3.6-hectare site is bounded by Crescent Street, Woodville Road, and Holroyd Sportsground. It benefits from strong access to public transport, including nearby bus routes and train stations, and sits within a rapidly evolving corridor earmarked for increased residential density. The design also strengthens connections between surrounding green spaces, including Holroyd Sportsground and Parramatta Parklands.

The approval follows several years of planning, including a rezoning process that enabled significant uplift in height and density across the site. With determination now secured, Crescent Parklands is positioned to play a major role in delivering new housing supply within Greater Parramatta’s growth area.

Gavin McPherson

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