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Mining town Moranbah is the epitome of a typical boom-bust story, with the concept of investing in the area out of many investors’ depth.
At one point, rental yields were soaring at around 20%, a figure more reminiscent of overseas markets than anything typically seen in Australia. <a target="_blank" href="https://www.propertyobserver.com.au/queensland/moranbah-current-listings-offer-yields-nearing-20-but-future-returns-less-certain/2012112158004">However, the future’s certainty even at that time – in 2012 – was questioned</a>.
In 2013, observer Terry Ryder said that the use of fly-in, fly-out (FIFO) workers was removing pressure on local rents and prices, with BMA (BHP-Mitsubishi Alliance) planning to have just FIFO workers on two of the new mines in the basin. Workers fly or drive in for their shift, stay in temporary camps, and return home.
“<a target="_blank" href="/news">Moranbah</a> rents and prices are falling right now, with residential vacancies up around 7%. In nearby <a href="/news">Dysart</a>, vacancies are approaching 15% and rental yields, previously above 10%, are now down around 5%,” he said.
Meanwhile, John Wood, of Moranbah Real Estate, said that the market was flat and slow. But as a long time resident, while admitting that prices had fallen, said that it was “at the point where it can’t fall any further”.
Omega Investments’ Flynn de Freitas, however, believes that the market is on the cusp of the “next property boom”. This is due to billions of dollars’ worth of projects in the pipeline that will "secure the town’s future".
Interestingly, this was in a report commissioned for <a target="_blank" href="https://matsonapartments.com.au/">Matson Apartments</a> (pictured below), where it noted that the market was reaching the floor and is setting itself up for another boom.
{yoogallery src=[images/stories/2014/02/07/mor]}
“The Moranbah property market is poised for its next boom with over $17.2 billion in major infrastructure projects planned and $5.6 billion of these approved within a 60 kilometre radius of the township,” the report said.
“While Moranbah has faced a range of challenges in the last two years – including industrial strikes, extraordinary rainfall events, a ‘rental freeze’ by a major employer, a substantial drop in coal prices leading to large scale redundancies and a sea change of locals moving out of town – there are signs the market is turning as nearby coal mines return to full production and new mining projects start construction.”
De Freitas describes Moranbah’s future as ‘secured’ by a worldwide demand for metallurgical coal, a demand which is expected to rise around 20% by 2018.
“Moranbah’s economic future is looking brighter than ever,” he said.
“This large number of new mining projects in the Moranbah region is underpinning strong population growth forecasts, with over a 45% increase in the town’s population expected in the five years to 2018.”
At 13 Bacon Street, Matson Apartments, a 30 unit development with a ground floor commercial retail space, is in a proposed dining and entertainment precinct.
The units, averaging 91 square metres, are priced from $447,500 and have a $700 per week leaseback by Direct Hotels &amp; Apartments option.
The developer, Don Moffatt from Moffatt Property Development Group, said that the town is just “misunderstood”. He also says that the yield and rental guarantee have not been built into the price.
“It is an independent offering from Direct Hotels &amp; Apartments who through a subsidiary have purchased the management rights to Matson Apartments,” he said.
“Not only will residents receive exceptional on-site professional management, investors will receive above market returns.”
{qtube vid:=UYUdnGbluHY#t=35}
The expectation is for Matson to be completed in late-2014.
With a <a target="_blank" href="https://www.sqmresearch.com.au/graph_vacancy.php?postcode=moranbah&amp;t=1">vacancy rate currently recorded at 9.4% by SQM Research</a>, and more supply coming onto the market, some are asking whether this boom will actually eventuate again.
 
{module What do you think is going to happen in Moranbah?}
jduke@propertyobserver.com.au
 
 
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jduke-EHk3XBmHkn

Busted suburb again labeled hotspot: The Moranbah debate

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The office markets around the country saw negative absorption and declining effective rents over 2013, driven by a slowdown in Chinese interest and a general lack of business confidence, according to Matt Whitby, Knight Frank's national director of research, however despite this being experienced by all CBD office markets, the forecasts are distinctly separate.
Soft tenant demand and a rising vacancy rate may have some investors concerned, however some cities will fare better than others, explained Whitby.
“Tenant demand remains soft and vacancy rates have been rising, however with the supply pipeline in most markets benign over the next two years, there will be the commencement of downward pressure on vacancy rates in 2014, particularly in Sydney and Melbourne,” he said.
“If occupier demand conditions are to materially improve, we need to see a sustained pick up in fulltime jobs, which will be driven by persistent strength in business confidence and an upswing in business credit. With the stimulus of historically low interest rates washing through the economy, there are tentative signs that this is beginning to occur. This is highlighted by a 15 per cent increase in tenant enquiries this year on 2012 levels, led by professional service based tenants and insurance and finance businesses.
“After delivering approximately 463,000 square metres of new and refurbished stock to the Australian CBD markets, which was down 29 per cent on the 649,000 square metres recorded during 2012, projected supply for 2014 is only 241,000 square metres, which is the lowest level of gross supply additions since 2001, when just shy of 200,000 square metres was completed."
Relatively strong completion activity was seen over the past two years, with this hiatus in new construction completions this year being a positive for the market. Whitby pointed to an overhang of backfill and sublease space that is awaiting absorption.
“Sydney and Melbourne are showing signs of a return to growth, with an increase in enquiry and a withdrawal or reduction of sublease space on offer, which bodes well. Additionally, the highest and best use of CBD sites are increasingly being slanted towards residential, which will continue to see ageing assets withdrawn from the market permanently and converted to an alternate use, cushioning the impact of below trend demand. This is a real game changer for markets as the consequent increase in withdrawals will also help cushion the market," he said.
“Net absorption remains strongest for Premium and A Grade space as tenants continue to upgrade their premises, while absorption of secondary stock is clearly negative. This performance gap will continue over the next 12 to 18 months as tenants continue to take advantage of the competitive leasing environment and relocate to better quality office accommodation. Occupiers are acutely aware of the need to attract and retain quality staff and the quality of the accommodation is a significant factor to many corporate relocations."
See over page for a state and territory update
 
 
 
<hr class="system-pagebreak">
 State and Territory performance and forecast summaries
 
ADELAIDE
Vacancy rates have pleateaued in the prime grade stock sector over the past quarter. Within the next 12 months it's expected that there will be a movement towards quality stock, with rental increases remaining subdued. Some upwards pressure will remain on incentives.
Source: Martin Potter, Knight Frank’s director, office leasing, SA
 
 
 
CANBERRA
There has been an increase in sublease space. This is due to the efficiency drive to reduce costs and duplication.
Uncertainty remains surrounding Canberra, and while the Commission of Audit is undertaken there have been resulting low levels of demand.
A drop in face rents is being seen as well as an increase in incentive levels.
Source: Nicola Cooper, Knight Frank’s director of leasing, ACT
 
MELBOURNE
The vacancy rate has peaked in the short term, with an expectation to fall over the next six months to mid-2014.
The migration of tenants from the fringe and suburban markets inwards, as well as some property being moved towards residential repurposing and sublease space have been the main drivers. This is resulting in incentives that are high, circa 30%, and prime rents holding, circa $460 net.
The 2014 outlook has improved demand as tenants realise the current situation won't last for long.
Source: Hamish Sutherland, Knight Frank’s national director, office leasing, VIC
 
BRISBANE
Lack of tenant demand and excess sublease space is causing the market to suffer, however there are a large number of requirements and enquiries in the market. The first quarter of 2014 should be revealing about these considerations.
A potential flurry of activity may trigger a positive ipswing in demand through 2014 and into 2015 before further stock occurs in 2016.
Source: David Howson, Knight Frank’s national director, office leasing, QLD
 
SYDNEY
A positive shift has been seen in the market, with enquiry improving during the second half of the fourth quarter in 2013. It is likely this trend will continue this year.
Confidence is growing in smaller business, and the demand for sub-500 square metres continues to remain strong, with incentives driving demand. Landlords are motivated to reduce vacancies by the middle of the year.
Rental growth remains flat, with no forecast for growth this year. 
Source: Scott Berriman, Knight Frank director, office leasing, NSW
 
PERTH
The flux of the conomy in Perth and with vacancy rates rising, it's clear there's very little demand.
The face market rents are falling, incentives are increasing, and they may be reaching a level that will entice tenants into moving.
Source: Greg McAlpine, Knight Frank’s national director, office leasing, WA
<a target="_blank" href="mailto:jduke@propertyobserver.com.au">jduke@propertyobserver.com.au</a>
 
 
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The outlook for CBD office markets around the country in 2014

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Three development blocks are going up for auction in a week’s time in Canberra’s Kingston Foreshore precinct, located within The Peninsula.
These harbourside blocks are of 2,413 square metres, 2,653 square metres and 4,859 square metres are being offered for sale individually.
<img alt="kingston_feb_5_one" height="313" width="470" src="/images/stories/2014/02/05/kingston_feb_5_one.jpg">
Each of the sites is zoned ‘mixed use’ and are being sold by CBRE’s Mark Nicholls and Andrew Stewart, who have been appointed by the Land Development Agency.
The potential for the blocks to be used as a commercial and residential precinct is a selling factor, said Nicholls.
“This is a rare opportunity for astute developers to purchase harbourside property with a diverse mix of outcomes,” he said.
“The Peninsula will offer the perfect combination of relaxed living with the excitement of a harbourside lifestyle. The surrounding Jerrabomberra Wetlands and nearby Norgrove Park further complement these properties.”
The auction, on February 12, will be held at 11am for all three blocks.
In September last year, <a href="https://www.propertyobserver.com.au/news/doma-group-snaps-up-kingston-foreshore-site-for-%24117-million/2013092765330" target="_blank">Doma Group purchased a Kingston Foreshore site for $11.7 million</a>. The area currently has a number of significant commercial tenants, including a Rustica, Cox Architecture, Max Brenner, Bloc and Vintage Cellars.
<a href="mailto:jduke@propertyobserver.com.au" target="_blank">jduke@propertyobserver.com.au</a>
 
 
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Development blocks up for auction in Canberra’s Kingston Foreshore precinct

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A Sydney-based Chinese legal firm has purchased an entire floor strata office in Melbourne’s CBD legal precinct for $1.45 million, setting a building record.
The 14-level strata office building, 256 Queen Street, between Lonsdale and Little Lonsdale Street is in the heart of Melbourne’s legal precinct.
<img alt="1" height="353" width="470" src="/images/stories/2014/02/05/1.jpg">
Photo: 256 Queen Street, Melbourne
The CBRE city sales team, Tom Tuxworth, Chris Pharr and Ed Wright, sold the property on behalf of a local investor.
Senior manager at CBRE, Tuxworth, said that the office space was 288 square metres, putting the price at just over $5,000 per square metre. It is an unrefurbished space.
“Owners of strata office floors are now being alerted to the unprecedented pent up demand for owner occupiers to purchase and operate out of their own office floor as opposed to re-leasing in what is considered a soft leasing market,” said Tuxworth
“Activity within the Melbourne CBD strata office market has been exceptionally high over the past five months with offshore groups now joining mum and dad self-managed super fund (SMSF) investors in purchasing commercial office space.”
He said that the current low interest rate environment, along with depreciation and tax benefits, have made this type of property highly sought after in recent times.
The building is halfway between Melbourne Central and Flagstaff stations.
<a href="https://mce_host/jduke@propertyobserver.com.au" target="_blank">jduke@propertyobserver.com.au  </a>
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Melbourne office secures a record $1.45 million from Chinese legal firm buyer

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Owning a holiday home is a dream for many Australians, however sometimes to achieve this goal it must be owned as a family, where you own a stake in the property. Apart from usual family disputes, this can provide another avenue for even the closest of blood relations to having a falling out.
Angus Raine, executive chairman and CEO of Raine &amp; Horne, says that there are ways of co-owning a holiday home, and co-using one, effectively.
Largely, it comes down to establishing expectations.
Scheduling dates 
“Family members would do well to agree to an accommodation schedule for the holiday home from the outset, which diarises when the property is occupied and by whom,” said Raine.
“Some weeks are more valuable than others, such as Christmas and Easter, but by taking a common sense approach, it’s feasible to develop an accommodation schedule which is suitable to all parties,” he said.
“It might be that those family members without children or those with pre-school children agree to stay at the property in non-peak times.”
A schedule should then be created among all involved parties including the decided dates.
“Once an agreement is reached, these dates should be included in the schedule, which is shared with all family members.”
Cleaning
An issue that causes disputes in households owned by one family, let alone extended family members, cleaning can be a tricky issue for joint holiday home owners.
“From the outset, all parties should agree about how the property should be left after a vacation stint,” encouraged Raine.
“Typically, to circumvent any concerns, all parties could agree to pay for a professional cleaner every time they exit the property.”
Dirty linen is also a regular issue, and Raine suggests that all residents take their own linen and then take it home with them when they leave.
Again, it comes down to expectations. If everyone knows to leave the gas bottle full for the barbecue, or to replace bulbs when broken, then no nasty surprises should arise.
Repairs and maintenance funds
A sinking fund, not unlike those used for strata arrangements, is suggested by Raine as one way of effectively preparing ahead of time.
“Alternatively, maintenance and repairs can be paid as required, or for the handy types, family members can fix leaking taps, slap on some paint and maintain the gardens themselves,” he said.
If there are breakages, then it’s worth just letting the other owners know and sorting out the problem.
“There’s nothing more annoying for the next family member than to arrive at the shared holiday home and discover the kitchen is short on basics such as plates, cups and glasses,” he said.
<a href="mailto:jduke@propertyobserver.com.au">jduke@propertyobserver.com.au</a>
 
 
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Three tips for handling joint holiday home ownership: Raine & Horne

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Fixed rate mortgages dropped slightly in January, yet record high demand is still being seen for fixed rate loans, according to Mortgage Choice’s figures.
Throughout January, 27.43% of all loans were for fixed rates, a significant dip on December, which was 5.63% higher, however still at strong highs not seen since 200.
New South Wales borrowers were those most likely to opt for a fixed rate loan, at 33.62%. Queensland came in a close second at 30.77%. Meanwhile, Western Australia and Victoria were recorded at 21.39% and 21.20% respectively. South Australia saw 19.78% of borrowers opt for a fixed rate.
Last month, several lenders did cut the rates on a number of fixed products, such as National Australia Bank, which cut to a 20-year low of 5.44%, said spokesperson for Mortgage Choice, Jessica Darnbrough.
"If we look back at the last 10 years, on average, fixed rates accounted for 17.63% of all home loans written. So, the demand we are seeing for this type of product is currently sitting almost 10% higher than the long term average," Darnbrough said.
The strength of fixed loans is expected to continue.
"All of Australia's lenders are competing very aggressively on price within the fixed rate arena, and while this is happening more borrowers will opt to fix their mortgage,” she said.
"In the current economic environment and with the Reserve Bank keeping its cards close to its chest, it is not surprising to see a large percentage of borrowers opting for the safety of a fixed rate home loan."
You can <a target="_blank" href="https://homeloans.propertyobserver.com.au/home-loans/">see home loan comparisons here if you want to see which rates are currently available</a>.
<a href="mailto:jduke@propertyobserver.com.au">jduke@propertyobserver.com.au</a>
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Fixed rates still the loan of choice: Mortgage Choice

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With yesterday’s decision to keep the cash rate on hold at a current record low of 2.5%, in the longest period of stability since 2007, investors are asking what they should expect next. Unfortunately, there doesn't seem to be a particularly clear picture available.
As is always the case around interest rates, companies send out their comments in reaction to the potential circumstances expected in advance so that the media can prepare their stories. This was the first meeting of the year and <a href="https://www.propertyobserver.com.au/news/reserve-bank-keeps-rates-on-hold-in-first-meeting-of-the-year/2014020467523?utm_source=po&amp;utm_medium=aida&amp;utm_campaign=news" target="_blank">it was generally accepted that no change would occur</a> at this February's meeting.
However, this was the first time in the most recent cycle that there was a clear split in the responses being sent through. While everyone sent through a response for the interest rates staying on hold, and of course this was commonly <a target="_blank" href="/news">expected among all of our experts surveyed</a> in the weeks prior, some only provided a rate drop alternative, while others only provided a response for if there was an increase.
This distinction makes it clear that there’s certainly mixed expectations as to what the Reserve Bank will be doing next and that there really is a division of perspectives within the market.
In fact, directly after the rate decision was made, there were already predictions for the next change being discussed.
RateCity noted that their expectation is for the next rate change to be an increase, particularly when using the actions of lenders as a gauge.
Since October 2013, 73 variable rates have increased out of cycle, while 550 fixed rates have increased.
CEO Alex Parsons said that while the recent decision wasn’t a surprise, households should be expecting the next rate move to be up, and that they should be ready to pay more for variable loans before the end of the year.
“Lenders are eager for new business and competition at the pointy end of the market remains strong. While the average basic variable rate is 5.19%, there are 25 variable home loans with rates below that,” he said.
Loan Market’s director, Mark De Martino, said this stability of rates has been encouraging buyers back into the market but that it’s largely unclear where the next movement will be as lenders are adjusting fixed rate products in opposite directions.
“For five consecutive meetings the RBA has made the right call by watching past rate cuts bring confidence back into the market. As inflation and unemployment numbers continue to make cases for rate movements in either direction, it’s not easy to predict where rates may head next,” said De Martino.
“There’s lots of posturing with fixed rates at the moment and with the daily fluctuations of the Aussie dollar, we’re seeing competition open up with lenders trying to correctly predict when this interest rate cycle will bottom out,” he said.
Interestingly, Place Advisory’s director Lachlan Walker believes that there’s likely to be no change until the second half of the year. After this time, his suggestion is that if there is any change it will be a drop.
“I can’t see the cash rate being lifted this year,” Walker said.
“If the Reserve Bank does anything to the cash rate, the only thing I expect they would do is reduce it,” he said.
“While inflation has risen a little, confidence is only starting to rebound and the Australian economy has yet to regain strength.”
He pointed to concerns around unemployment as a clear sign that there’s still a way to go before rates can be increased again.
Meanwhile, Ruan Burger, TIME Home Loans director, said that the banks maintaining or dropping their rates is a good indication that the RBA is expected to remain stable.
“As has been widely reported, many banks have dropped their fixed rates recently, including majors such as Westpac and NAB, as well as non-majors such as Citibank,” he said.
“This reduction in fixed rates is more a reflection on their costs and subsequent margins, however, and this has enabled them to factor in a drop. If they were anticipating that the cash rate would rise though, fixed rates would likely be going in the other direction.”
“The cost of money is cheap, and this is undoubtedly creating an opportunity for home buyers and investors – you really can’t say people can’t get into the market now if they don’t want to,” he said.
It seems that there’s really no general consensus on what the Reserve Bank's next likely act will be. You can <a href="/news">read more details from our expert panel, who all tipped the latest 'no change' verdict accurately</a>.
 
{module What do you think the next Reserve Bank rate movement will be?}
 
jduke@propertyobserver.com.au
 
 
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When and what will the next Reserve Bank movement be?

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Everyone tuning in to last night's The Block: Fans v Faves would have noticed that stress levels were high as the couples were surprised with the expectation of their floorplan to be turned in with around 24 hours notice.
However, some groups were more panicked than others. It seems there are some tried and tested skills that will keep even the most novice renovators in a better position.
We turn to the beautiful <a href="/news">Dux cinema in Melbourne's Albert Park that Property Observer previously reported on</a>, as the location of the latest challenge. Favourites, "Alisa and Lysandra" and "Brad and Dale" and fans "Chantelle and Steve" and "Kyal and Kara" have their work cut out on converting this space, while camping in the building, in 10 weeks.
You can <a href="https://www.jump-in.com.au/show/theblock/fans-v-faves/" target="_blank">catch up on episodes online</a>.
Here are the five lessons we learned from tuning in last night:
<blockquote>
Renovators should always look to plan ahead if they want to get the best results.
</blockquote>
1) Plan ahead
With ten weeks and an intense project to complete, there's no excuse for not planning ahead for this season's Blockheads. Similarly, renovators should always look to plan ahead if they want to get the best results.
The more you can have written down, prepared and scheduled, the better.
2) Communicate with your team (and choose them wisely)
In last night's episode, we saw some fairly excellent examples of teams working well together, as well as some easily-avoided situations where time was lost due to poor communication.
Our current favourite builder, Super Luke, is left without direction by Chantelle and Luke. While he does his best, they need to make decisions and precious time is being lost.
Similarly, when the surprise floor problem appears for Alisa and Lysandra, they become angry at their tradespeople. There's usually a better way than anger.
<blockquote>
Pick your team wisely and keep channels of conversation consistently open.
</blockquote>
Pick your team wisely and keep channels of conversation consistently open. Ensure to outline your expectations, the extent of the job (there was more than one surprised builder on The Block last night) and what to do if they're unsure.
3) Don't be afraid to spend time where it counts
Kyal, as a trained carpenter, decided to take on the task of making the stud walls - prompting all sorts of jokes about studs, both walls and otherwise, in the Twittersphere. Fair enough, however he is also tasked with finding the right tradespeople for the other jobs.
While he seemed to do a great job with the stud walls, it undoubtably took far longer than if he had focused on that task after or before starting on phoning around. Focus on one thing at a time, and be sure to prioritise tasks.
Similarly, when it comes to prioritising - don't feel that you need to do everything in groups. Sometimes, the most effective thing to do is split up. Too often, no one is left on site to collect deliveries (we certainly saw this last night from Kyal and Kara). A quick summit to discuss the style needed, and trusting your renovation partner, is surely a far quicker way to get the job done.
We definitely give a thumbs up to Kyal for getting his sleeves rolled up and using his skills. DIYing doesn't suit anyone, but it can certainly save you money when done well. 4) Adapt and evolve
What happens when you discover that your feature, a staircase leading up to a small office, is not going to be possible? Make a void instead. Kitchen Queens Alisa and Lysandra showed strength by adaptating at the last minute when their plans need to be changed.
Similarly, being able to evolve your ideas to the space you're in is certainly a skill that most renovators should be able to cultivate. We point to the particularly popular 'barn door' created by Chantelle and Steve.
Bad weather, particularly when you don't have a ceiling, is also going to be absolutely critical to negotiate.
5) Have a vision
When faced with an empty space, particularly like this where the ceilings, walls and floors are all open for any design, you need to be quick to come up with ideas. You will also need to be able to envision how the space will work very quickly. Vision here is absolutely crucial.
<blockquote>
You will also need to be able to envision how the space will work very quickly.
</blockquote>
Whether it's a pool, a cinema, or underfloor heating, or any of the other exciting aspects we're seeing the teams installing, the overall plan is just as important as the individual aspects. Those watching last night also suggested ideas such as a spa for the common space.
Remembering to be practical but to add the "wow factor" (another term we heard a lot) is going to be crucial.
What tips do you have from watching last night's The Block Fans v Faves?
<a href="mailto:jduke@propertyobserver.com.au" target="_blank">jduke@propertyobserver.com.au</a>
 
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Five renovation lessons from last night's The Block: Fans v Faves

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The Reserve Bank of Australia has left the official cash rate unchanged at 2.5%, in line with analysts’ predictions.
It is the fifth meeting month in a row the Reserve Bank has left rates unchanged at a record low.
In the <a target="_blank" href="https://www.propertyobserver.com.au/news/february-statement-by-glenn-stevens-governor-monetary-policy-decision/2014020467526?utm_source=po&amp;utm_medium=aida&amp;utm_campaign=newsplus">statement released by the Reserve Bank noting that they would keep rates on hold</a>, governor Glenn Stevens said that since the previous meeting, information on the global economy has been consistent with the growth having been a bit below trend in 2013, but with prospects of a 2014 pick up.
"In Australia, information becoming available over the summer suggests slightly firmer consumer demand and foreshadows a solid expansion in housing construction. Some indicators of business conditions and confidence have shown improvement," Stevens said.
"At the same time, with resources sector investment spending set to decline significantly, considerable structural change occurring and lingering uncertainty in some areas of the business community, near-term prospects for business investment remain subdued. The demand for labour has remained weak and, as a result, the rate of unemployment has continued to edge higher. Growth in wages has declined noticeably."
The RBA previously cut rates in August 2013, May 2013, December 2012, October 2012, June 2012, May 2012, November 2011 and December 2011.
RP Data’s national research director, Tim Lawless, said that the decision has come as no surprise to the industry, with a number of positive data flows over recent weeks.
“From a housing market perspective, the release of the RP Data – Rismark Home Value Indices yesterday showed home values were still rising across Australia, up a strong 1.2%over the month of January,” said Lawless.
“The latest housing market results take annual capital gains across the combined capital cities to 9.8%, with every capital city apart from Hobart recording a rise in dwelling values over the year,” he said.
“While the Reserve Bank leaves the cash rate unchanged at 2.50%, it’s game on for borrowers. Lenders are moving outside the cash rate which means borrowers are likely to find even better deals this year.”
Michelle Hutchison from Finder said that it’s worth keeping an eye on the movements that the lenders make.
“For the past 2 years up until November 2013, lenders have generally moved when the cash rate moved, but in the last month we recorded 42 home loan rate changes by 14 lenders, where more than half have decreased their rates including some variable loans,” said Hutchison.
“Of those, only two from the big banks have lowered their fixed rates - Westpac and NAB both decreased their three year fixed package home loan by 0.05% to 5.14%.”
“This is good news for borrowers as you no longer have to wait for the cash rate to change. You can capitalise on the competition from lenders by comparing loans and switching to cheaper deals,” she said.
<a target="_blank" href="mailto:jduke@propertyobserver.com.au"></a><a href="mailto:jduke@propertyobserver.com.au">jduke@propertyobserver.com.au</a>
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Reserve Bank keeps rates on hold in first meeting of the year

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Victoria’s Werribee Plaza Shopping Centre will see a $370 million redevelopment, according to the Pacific Group of Companies (PGOC) who have announced that they will provide these funds with construction underway.
The redevelopment, set to expand the Centre’s size by more than 35,000 square metres with fashion, fresh food, dining and entertainment precincts, will also see the plaza adopt a new name – ‘Pacific Werribee’.
It appears the plan is to reposition the plaza as the new premier retail destination of Melbourne’s western suburbs.
It is located in the Wyndham region, at the centre of the western corridor that has been experiencing significant population growth.
The development will include a two-level Myer store, Target store, 120 new shops and kiosks, a new fresh food precinct branded ‘Hunter &amp; Gatherer’ that will include a Woolworths and an ALDI, a Village Cinemas redevelopment with two new Gold Class Cinemas and 1,500 additional car parking space.
PGOC’s Graham Terry said that the development will be an asset for the rapidly growing area.
A new 10-bus terminal interchange, and outdoor al fresco restaurants and cafes will also be included.
Pacific Werribee will also be reclassified from being a ‘sub-regional’ centre to a Regional Shopping Centre due to the addition of the two-storey, 12,500 square metre Myer department store.
The key completion dates include the early-2014 opening of the bus terminal, early-2015 opening of the dining and entertainment precinct, mid-2015 opening of new Target and speciality stores, mid-2016 opening of the Myer and more speciality stories and late-2016 opening of the food precinct.
<a href="mailto:jduke@propertyobserver.com.au">jduke@propertyobserver.com.au</a>
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$370 million boost for Melbourne's Werribee Plaza

For most new apartment buildings, the Owners Corporation starts life with little more than a bank account and the first quarterly strata levies.

At <a href="https://www.apartments.com.au/buildings/9-gay-street-castle-hill-9-gay-street-castle-hill-nsw-2154">9 Gay Street</a> in <a href="https://www.apartments.com.au/developments/castle-hill-nsw-2154">Castle Hill</a>, it starts with around $7 million in reserve.

It's an unusual legacy of what was once one of Sydney's highest-profile apartment remediation projects. When the development, originally known as Skyview and built by disgraced developer Top Place, came under scrutiny by then NSW Building Commissioner David Chandler, an $11 million remediation bond was negotiated to ensure any building defects could be fully rectified.

The building underwent an 18-month remediation program, during which around $4 million of that bond was spent bringing the building up to the standard it should have been in from the outset.

After extensive inspections, all active rectification orders have been lifted. What's more, around $7.2 million remains secured for the Owners Corporation for the next 15 years.

In a twist few would have predicted, what began as a significant concern for purchasers has left the building with something almost unheard of in the apartment market: a multi-million-dollar financial reserve from day one.

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<a href="https://www.apartments.com.au/project-marketer/equitifund-group">Equitifund</a> Executive Chairman Greg Huxley said the structure offers buyers a level of certainty that is difficult to replicate.

"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."

The apartments themselves have been designed with a focus on practical, contemporary living. Interiors feature Smeg appliances, stone benchtops, tiled living areas, carpeted bedrooms, 2.7-metre ceilings, floor-to-ceiling glazing, and ducted heating and cooling throughout.

Residents also have access to a range of shared amenities, including two rooftop barbecue areas, a swimming pool, children's playgrounds, secure building access, storage cages, and visitor parking.

The location continues to be one of the project's strongest drawcards. Castle Hill Metro Station sits virtually on the doorstep, providing direct connections across Sydney's expanding Metro network, while Castle Towers offers extensive retail, dining, entertainment, and service amenities within walking distance.

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The building, now named after its location at 9 Gay Street, comprises a diverse mix of one-, two-, and three-bedroom apartments starting from just under $600,000.

Equitifund National Sales Director Ben Hamblett said demand in the Hills District continues to be driven by buyers seeking convenience and connectivity.

"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."

On top of the long-term protection afforded by the remaining $7.2 million bond, Equitifund is offering a limited-time stamp duty rebate on selected apartments.

Eligible purchasers can also secure finance options, including a 3.99 per cent two-year variable rate, loan-to-value ratios of up to 90 per cent, and interest-only lending options through EquitiCredit.

[smartcode_project_cta:default project_id=147685]

Joel Robinson

Why this Castle Hill apartment building starts with a $7 million advantage

For much of the past few years, conversations about Australia's property market have centred on the rapid growth seen in Sydney, Brisbane, Gold Coast, and Perth. <a href="https://www.apartments.com.au/developments/melbourne-vic-3004">Melbourne</a> has followed a different trajectory.

That relative underperformance is now encouraging some buyers to reassess the city, particularly those willing to look beyond short-term market movements and focus on quality property in established locations, along with the long-term growth prospects of a city expected to overtake Sydney as Australia’s most populous.

John Bekiaris, Research &amp; Market Insights at <a href="https://www.apartments.com.au/project-marketer/equitifund-group">Projects by Equitifund</a>, said Melbourne's current position is attracting increasingly sophisticated purchasers.

"Melbourne continues to present one of Australia's strongest long-term investment stories," Bekiaris says.

"While other capital cities have experienced stronger recent growth, that relative underperformance is exactly what's attracting sophisticated counter-cyclical investors."

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Equitifund isn't just commenting on Melbourne's property market, it's investing in it.

The Sydney-headquartered capital partner has taken over the remaining apartments at <a href="https://www.apartments.com.au/buildings/victoriana-melbourne-20-queens-road-melbourne-vic-3004">Victoriana</a>, the recently completed glass-encased development opposite Albert Park Lake in Melbourne's tightly held St Kilda Road precinct.

Designed by <a href="https://www.apartments.com.au/architects/rothelowman">Rothelowman</a> and built by <a href="https://www.apartments.com.au/builders/hickory">Hickory</a>, Victoriana places residents between one of Melbourne's most recognised parklands and the CBD, offering oversized two and three-bedroom apartments aimed at owner-occupiers seeking a genuine alternative to a traditional family home.

The development comprises 232 completed residences alongside a suite of resident amenities, including a 25-metre indoor swimming pool, gymnasium, landscaped entertaining areas, resident lounges, EV charging, secure basement parking and a concierge-style arrival experience.

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The apartments have been designed with owner-occupiers firmly in mind.&nbsp;Open-plan living and dining areas flow onto generous balconies framing views across Albert Park Lake, Fawkner Park, the Royal Botanic Gardens and the Melbourne skyline.

Kitchens feature Gaggenau appliances, stone benchtops and generous preparation space. Bedrooms include built-in robes, while bathrooms feature full-height textured tiling. Hardwood flooring and ducted air conditioning complete residences designed for long-term living.

Rothelowman's architecture takes its cues from the landscape opposite the site. Sweeping horizontal glazing references the movement of Albert Park Lake, while generous balconies and expansive glazing strengthen the connection between the apartments and the surrounding parklands. The result is a building designed to deliver the scale and amenity expected of luxury apartment living, while offering the larger floorplans increasingly sought by owner-occupiers.

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The location is one of Victoriana's defining characteristics. Positioned on Queens Road, residents are directly opposite Albert Park Lake and within easy reach of Fawkner Park, the Royal Botanic Gardens, South Melbourne, St Kilda Road and the CBD. With few comparable development opportunities remaining in the precinct, buyers are increasingly placing value on outlooks that are unlikely to be interrupted by future construction.

Greg Huxley, Founder of Equitifund, believes those qualities become even more valuable over time.

"Premium real estate has always rewarded buyers who take a long-term view," Huxley said.

"Victoriana represents the kind of asset that's increasingly difficult to recreate today, particularly in an established location like Queens Road."

He said rising construction costs are also changing the way buyers assess completed developments.

"When you combine an irreplaceable location with thoughtful architecture and premium finishes, you create something that becomes increasingly difficult to reproduce as construction costs continue to rise."

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According to National Sales Director Ben Hamblett, enquiry has been driven largely by Melbourne downsizers and buyers upgrading from smaller apartments.

"Interest in Victoriana continues to build, with strong buyer focus on the larger owner-occupier residences within the development," Hamblett says.

"Enquiry is increasingly driven by local buyers who recognise the rarity of what's on offer: park-facing apartments in an established neighbourhood where new development opportunities are becoming increasingly scarce. At Victoriana, the view is not just a feature; it's an appreciating asset in its own right."

He said interstate enquiry has also strengthened as buyers reassess Melbourne's position within the national property cycle.

"Melbourne currently stands as the most compelling entry point of any major Australian capital, and discerning buyers are beginning to recognise what those who move early always understand: the best opportunities are taken before the price rise confirms them."

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Why now is the time to buy in Melbourne's premium apartment market

Developers and apartment buyers have a narrowing window of opportunity before Brisbane's Olympic infrastructure pipeline begins competing directly with residential construction, pushing up costs, tightening labour supply and making new projects increasingly difficult to deliver.

While Brisbane's apartment market continues to benefit from strong population growth and limited housing supply, industry research suggests the years leading up to 2027 could prove to be the most important period for developers looking to secure builders and buyers hoping to purchase before the next wave of price increases.

A new Colliers report, Brisbane 2032 Olympic and Paralympic Games: Creating Solutions, highlights the scale of the challenge. While thousands of new homes are planned across South East Queensland, the Brisbane Olympic Athletes Village alone will deliver more than 10,500 beds during the Games before being converted into around 1,750 to 2,000 apartments. Equivalent to almost two years of typical inner-city apartment supply, the project will also absorb a significant share of the construction workforce and building materials.

The broader construction pipeline paints an even clearer picture.

Construction Skills Queensland's Horizon 2032 report forecasts Queensland's annual construction pipeline will average $69 billion over the coming years before peaking at $75 billion in 2027-28. Demand for construction workers is expected to increase by 17 per cent to almost 150,000 people, with the industry facing an annual shortfall of around 19,000 workers that could blow out to as many as 35,000 during the peak construction period.

The Olympic venues, athletes village and supporting infrastructure will account for billions of dollars worth of work across South East Queensland through to 2032, creating intense competition for labour at a time when Australia's residential construction sector is already under pressure.

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Colliers Queensland Residential Director Andrew Scriven said the convergence of these projects is creating a clear window of opportunity for both developers and buyers.

"From 2027 onwards, the market will shift dramatically," Scriven said.

"Labour will increasingly be locked into government-led infrastructure and Olympic projects, which means private residential developments will face higher costs and tighter margins. The developers who move now are the ones most likely to get projects off the ground."

Scriven said the same dynamic would also affect buyers, with fewer apartment projects expected to launch once construction capacity tightens.

"If you're looking to change your lifestyle over the next five years, now is your window of opportunity to buy."

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Developers are already positioning themselves ahead of that window.

Following the success of Monarch at Toowong, Consolidated Properties is preparing to launch two new Brisbane apartment projects in the second half of 2026. They include <a href="https://www.apartments.com.au/new-apartments/gloriette-30-bedivere-street-yeerongpilly-qld-4105">Gloriette</a> at Yeerongpilly Green, a 25-storey tower within one of Brisbane's key Olympic precincts, and <a href="https://www.apartments.com.au/new-apartments/castile-47-skyring-terrace-newstead-qld-4006">Castile</a>, a recently approved 25-storey riverfront development at 47 Skyring Terrace in Newstead.

Hutchinson Builders will deliver both projects, with early works already underway at Yeerongpilly and Newstead expected to commence later this year.

The timing comes as Brisbane's fundamentals continue to strengthen, with strong interstate migration, population growth and vacancy rates remaining below 1.5 per cent.

Colliers Queensland researcher Pragya Sharma said Greater Brisbane is forecast to require around 40,000 new apartments between 2021 and 2031.

"There's a real mismatch emerging between when housing is needed and when it will be feasible to build," Sharma said.

"As a result, the period leading up to 2027 presents a key window of opportunity for developers to secure approvals, funding and construction capacity, while buyers will have greater choice before supply constraints intensify."

Colliers research outlines a critical pre-2027 window to start residential projects before labour squeeze: now is the time to buy

Developers, buyers on watch in South East Queensland ahead of construction crunch: Colliers

It's taken less than nine months for developer Sherpa Property Group to sell out all 51 apartments in its <a href="https://www.apartments.com.au/new-apartments/flourish-oasis-palm-beach-7-9-sixth-avenue-palm-beach-qld-4221">Flourish Oasis</a> development in <a href="https://www.apartments.com.au/developments/palm-beach-qld-4221">Palm Beach</a>, over a year before its anticipated completion.

&nbsp;

Located at 7-9 Sixth Avenue, the $67 million development has resonated strongly with both local owner-occupiers and downsizers seeking high-quality apartments within walking distance of the beach, dining precincts and everyday amenities.

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Christie Leet, Founder of <a href="https://www.apartments.com.au/developers/sherpa-property-group">Sherpa Group</a>, said the sell-out reflected both the strength of the Palm Beach market and the success of Sherpa's community-first approach to development.

"The sell-out of Oasis is a fantastic outcome and reinforces the strong demand we're seeing for thoughtfully designed apartments in lifestyle locations," Leet said.

"From the outset, our vision was to create a development that genuinely enhanced the Palm Beach community while providing residents with exceptional homes and wellness-focused amenities.

"We've been incredibly encouraged by the level of local support throughout the campaign, 72.5 per cent of buyers are locals, with a significant proportion of purchasers choosing Oasis as their future home rather than an investment."

[smartcode_project:default project_id=151449 project_image_fid=357463]

Construction is now progressing following development approval, with trusted builder LPS Group delivering the project and completion anticipated in Q3 2027.

Oasis forms part of Sherpa Group's successful Flourish collection, which has become recognised for its focus on wellness, community and elevated coastal living.

[smartcode_project:default project_id=151449 project_image_fid=357469]

Residents will have private access to a rooftop amenity space featuring a pool, gym, sauna, steam room, hot and cold plunge pools, spa and barbecue facilities.

"The success of Oasis demonstrates that buyers continue to prioritise quality, location and lifestyle," Leet said.

"We are proud to have delivered a project that has resonated so strongly with the market and look forward to bringing Oasis to life for our future residents."

Sherpa recently launched <a href="https://www.apartments.com.au/new-apartments/flourish-soleira-palm-beach-1150-1160-gold-coast-highway-palm-beach-qld-4221">Flourish Soleira</a>, its third instalment of the Flourish brand in Palm Beach following Flourish Oasis and <a href="https://www.apartments.com.au/new-apartments/amargo-6-12-sixth-avenue-palm-beach-qld-4221">Flourish Amargo</a>.

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Sherpa sells out Flourish Oasis in booming Palm Beach

Urban Property Group's <a href="https://www.apartments.com.au/new-apartments/la-vera-macquarie-park-94-talavera-road-macquarie-park-nsw-2113">La Vera</a> is leading the next phase of Macquarie Park's residential evolution, with the new apartment development set to become the first of several new apartment projects in the precinct to complete.

The 169-apartment building has now topped out ahead of its scheduled completion in the third quarter of 2026, as new residential investment continues to reshape one of Sydney's largest employment hubs into a true mixed-use precinct.

[smartcode_project:default project_id=134951 project_image_fid=368645]

Cox Architecture has designed La Vera to capture the best of its unique positioning on Talavera Road, orienting the building towards Lane Cove National Park.&nbsp;The building features a sculpted northern façade with flowing curves inspired by the surrounding landscape, while its city-facing elevation adopts a more structured architectural expression to maximise skyline views.

"The vision for the project was to conceive a building that adopted an organic and curvilinear form to the northern portion that faces the Lane Cove National Park," <a href="https://www.apartments.com.au/architects/cox-architecture">Cox Architecture</a> Director Felipe Miranda said.

"The residents that reside in the northern portion of the building benefit by having beautifully crafted curved balconies that speak to the natural context and heighten the relationship of their internal living spaces to the external balconies."

[smartcode_project:default project_id=134951 project_image_fid=358802]

La Vera offers a diverse mix of one, two, three, and four-bedroom configurations, with prices currently starting from $740,000. Buyers so far have been a mix of Sydney-based investors,&nbsp;metro commuters, owner-occupiers and downsizers from surrounding North Shore suburbs.

Both investors and owner-occupiers have been drawn to La Vera's proximity to Macquarie University, Macquarie University Hospital, Macquarie Centre and the Sydney Metro, infrastructure that supports both strong rental demand and a convenient lifestyle for residents.

The apartments feature full-height glazing, timber flooring throughout living areas, stone kitchen benchtops, SMEG appliances, floor-to-ceiling bathroom tiling and ducted air conditioning.

Residents will have access to a rooftop recreation level featuring a swimming pool, sauna, barbecue facilities and landscaped relaxation areas, complemented by additional communal space at ground level. Many apartments enjoy uninterrupted views across Lane Cove National Park, reinforcing the project's connection to its natural setting.

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<a href="https://www.apartments.com.au/developers/urban-property-group">Urban Property Group</a>, a family-owned developer and builder with nearly four decades of experience, holds a 4.5-star iCIRT rating and was Australia's first developer to introduce 10-Year Latent Defects Insurance (LDI). La Vera is the first apartment development in <a href="https://www.apartments.com.au/developments/macquarie-park-nsw-2113">Macquarie Park</a> approved to offer the additional insurance protection, alongside a five-year warranty on SMEG appliances.

Urban Property Group CEO Patrick Elias said the additional protection reflects changing buyer expectations in the off the plan market.

"Consumers are a lot more weary and a lot more concerned in buying off the plan than they ever have been. Having LDI is a tool to portray the confidence that we have in our product, and a confidence we want buyers to share," Elias said.

Following completion of the building later this year, buyers will move into their apartments well before Christmas.

[smartcode_project_cta:default project_id=134951]

Jennifer Duke

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