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So you’ve just received your development application and construction certificate consent and it’s almost time to start building.  Just how long will the construction phase of your development take? Or more importantly, the question is how long before you start making a return on your investment?  I guess this is like asking, how long’s a piece of string?  Because the answer will depend on many factors:
-   The number of dwellings you are building – single house or multi-unit development?
-   The type of construction process: slab and brick, timber floor and walls, partially prefabricated materials, etc.
-   The size and degree of difficulty of the structures
-   The weather: how many rainy days will delay progress?
-   Material and contractor availability
-   The builder’s ability to manage his contractors – his relationship with his trades and communication skills
-   The knowledge and experience of those managing the project
-   Any issues that may arise during the development process i.e. hitting rock when excavating
Generally speaking, the build phases on Property Bloom projects range from a dual occupancy being completed within four months to a four-villa project being completed in six months.  Our granny flat developments are only two months from receipt of approval to completion of building works.
Now you have an idea on how to estimate your build time, is there a way you can save on holding costs too?  The answer is yes and it’s all about analysing your building drawdown schedule.  A simple revision to a builder’s drawdown schedule can end up saving a considerable amount of money in interest holding costs.
Typically, my builder’s drawdown schedule would go something like this for a dual-occupancy development:
Deposit – $5,000 due when signing the tender (before DA is lodged)
Slab less deposit paid – 20%
Frame and trusses – 20%
Lock up – 25%
Mould out – 25%
Completion – 10%
By requesting a change of just a few percentages over each phase we can save thousands of dollars for our clients.  This was our proposed change to the schedule:
Deposit – $5,000 due when signing the tender (before DA is lodged)
Slab Less deposit paid – 15%
Frame and Trusses – 20%
Lock up – 20%
Mould out – 25%
Completion – 20%
This is a much better schedule for our clients as there is more to be paid towards the end of the build.  Not only does this save on interest costs, but it keeps the builder ‘in the game’ as there is more for him due at the back end of the build.
If I was really good at maths, I could calculate the exact amount saved be tweaking the percentages....but alas, I’m not that clever.  So here is a challenge for all you clever readers...
Assumptions:
Build cost and construction loan is $500,000,
Total build time frame is five months from slab down.
An equal amount of time between each phase, although not likely, just to make it easier to calculate.
Interest rate 7%.
Can you tell me what would be the difference in interest payable for each scenario?  I look forward to hearing from you. Please email your answers to: <a href="mailto:jo@propertybloom.com.au">jo@propertybloom.com.au</a>
Jo Chivers is director of <a title="Property Bloom" target="_blank" href="https://www.propertybloom.com.au/">Property Bloom</a>, which manages property development.
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The amount of time a development takes will vary

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This week I created a system.  My aim was simple: to achieve more in less time.
I had decided to set up a meeting with one of my builders.  The builder and I only started working together fairly recently when I introduced this particular type of development earlier this year, and  over a short period of time we were now up to our sixth project.  I knew we could fine-tune our process.  He’d had some recent staff changes so it was the perfect time to gently tell him exactly how I wanted my developments to run.
Before the meeting yesterday I’d prepared a draft procedures document, which was based on the way we had been doing things up until then.
But it wasn’t until I started documenting pretty much everything we did that I realised how much was involved in this somewhat basic development strategy.  What started in my mind as a one-pager has turned into four. It’s funny how we simplify in our minds a process because we’ve done it time and time again.  But when you really break it down in writing, you can see all the fine details.
Using a system or procedure keeps me on track with our projects. I now literally have a written system for everything I do.  It gives me something tangible to show to my clients and helps explain exactly what Property Bloom really does when managing their development.   It’s also an important tool to use when training new staff as they have a documented procedure to follow.
By the end of the meeting with my builder, we had agreed on a three very important changes that will impact the bottom line of my developments;
<ol>
<li>We changed our standard floor plan slightly to make it more cost effective to build, without reducing the size. Now I could offer my clients a cheaper build price that will not impact on the end value or rental return.</li>
<li>We changed the payment schedule so my clients would pay less in the first half of the build phase, saving them valuable holding costs.</li>
<li>We minimised choice to save time. By setting up standard inclusions plus a list of ‘”optional extras” it meant that clients would not feel overwhelmed by choice on fittings, fixtures and colour selections and we could manage this process faster moving to the next step and saving time.</li>
</ol>
I was happy with my new system and excited to put it into action immediately and already we are getting more done in less time.  Because as they say – time is money.
Jo Chivers is director of <a href="https://www.propertybloom.com.au/" target="_blank" title="Property Bloom">Property Bloom</a>, which manages property development.
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A systematic plan will help you organise your development

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I often get asked what I do for a living.  My “elevator pitch” or quick answer is “ I help people develop property by managing all the details from finding the right site through to finding the right tenants on completion.  The result is creation of a large amount of equity through the development process.”
Their next question is always why don’t you just develop property for yourself?
The answer to this is a bit longer, but to keep it short and sweet, I love sharing knowledge and find it very satisfying project managing developments.  I do have a stake in all our developments anyway, as I share in the equity we create.  This means I take personal ownership of the developments. Over the past eight years the number of developments Property Bloom has managed stands at 53. This is on average of 6.6 developments per year.  Also, the bottom line is that there is no way I could finance 53 developments on my own.  By doing them for others, I get to do what I love and make a living from it. No brainer, really.
So what are the benefits of using a professional project manager for your development?
Save money: A good project manager will have established discount structures in place with builders, architects, surveyors and other contractors.  On a three-villa project, the builder’s discount alone saves our clients over $12,000. On a six-villa project we’re saving them well over $30,000. These savings help offset the project management fee.
Save time:  To set up your own development team, find the right site, run feasibilities, design the project, manage the planning phase and then the build phase for even a small dual occupancy can be very time-consuming. If you are trying to hold down a full-time job at the same time, you will find it challenging. Using our refined system, we fast-track all stages of the project for clients.
Minimise risk: If it’s your first development then just one error may mean the difference between a profitable development and a non-profitable one. Using an experienced project manager takes some of the risks away. Developing will always have an element of risk, every development is different and we’ve learnt something new from each one we’ve finished.
Learn how to develop: Simply by going through the process working with a project manager you will learn so much. If you engage a project manager who is happy to teach you along the way, then you may be ready to manage your next project on your own.
Access to sites not on open market: Our sources know what we’re looking for and will contact us about sites they may have available or have coming up.  About 50% of our sites have not hit the open market.
Professionally managed and recorded: The paperwork alone can be mountainous and you want to ensure all documents are kept to maximise your tax return and so you can use them as a reference when doing your own project.
Local knowledge and experience: Property Bloom specialises in the Lower Hunter Region of NSW. So we know the markets very well and can quickly analyze a potential site location. Our contact base of agents, contractors, builders and other professionals is broad and we have been able to weed out any suppliers we have not been happy with in the past. We continue to fine-tune and improve our systems and processes.
Keep your day job: Cashflow is important when developing, so all of our clients have day jobs to fund their developments. It enables them to keep moving forward with building their property portfolios.  We often have clients running two projects simultaneously to fast-track their wealth creation.
If you’re thinking of developing but are a little worried, work with a project manager who has local knowledge and good experience in the area you want to develop in. You’ll essentially be buying yourself the time and experience it would have taken you to get up to the same level.
Jo Chivers is director of <a href="https://www.propertybloom.com.au/" target="_blank" title="Property Bloom">Property Bloom</a>, which manages property development.
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Developments run more smoothly with a project manager

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Even before you start looking for your development site, you’ll need to clarify one thing.  Are you developing to sell or to hold?
To answer this question, you may need to answer another:  Is your strategy short or long term?  If it is short term, then selling may meet your needs to make a quick return on your investment. If you have a long-term strategy to build up a property portfolio, then holding will be the way to go.
There are several factors that will influence your decision:
Location
Your development is in an awesome location but in a poor rental market.  An example of this may be a coastal area where there may be higher demand from owner-occupiers wanting to purchase low-maintenance property to retire to. In this case you may sell to realise your profits, as holding would not be viable due to low rental returns.
Timing
If you complete your development and the market is in an upswing with high demand, then you may get a higher-than-anticipated sales price. So this may influence you to sell. But if the market is down and there is an oversupply of property but a tight rental market, then holding may make sense.
Interest rates
An important factor in calculating holding costs is interest. If interest rates are around 6.5% as they are now yet the rental yield is around 8% in the area you’re developing in, then holding the properties makes good sense. You may look at fixing rates for a few years, to take the risk of rates rising out of the scenario.
Taxation 
You need to discuss your personal and/or company tax situation with your accountant before starting to develop property. There is capital gains tax to consider when selling as well as GST implications when selling new dwellings. These alone may sway you to hold. You also need to check on land tax to see if this will affect you if you decide to hold.
Most of Property Bloom clients develop to hold.  This is because they choose to access the equity – which is created through the development process – through refinancing on completion.  This means they don’t have selling costs like agents selling commission, capital gains tax and GST.   Once refinanced, they can pull some equity out of the development if they choose.
Another deciding factor in holding is in the areas of the Hunter Region we develop in is that we are getting very strong rental returns. We find that we can maximise the rent because the villas are new. Tenants do pay a premium to live in a new dwelling. Also the vacancy rates are less than 1%.  The gross yield on completion can be as high as 9%. The yield does also depend on the size of the development.  A three-villa project will have a higher yield than a dual occupancy.
Another reason our clients hold is take advantage of the high depreciation benefits they receive on the new dwellings.  On a typical dual occupancy, our clients are receiving around $17,000 in year one (based on diminishing value method). If you are paying lots of tax, this is definitely one of the rewards of holding.
The final reason Property Bloom clients hold is because they want to build up a retirement fund and take advantage of future capital gains. In the suburbs we develop in, there is high potential for capital growth because of many factors including increased population, projected housing demand in the council’s regional strategy, spend on infrastructure and the benefits that the coal mining industry bring to these towns.  The long-term growth figures are over 12%.  So if a client can create say $80,000 to $120,000 in equity through the development process and then holds for 10 years, he or she stands to receive 12% growth on average, each year.  The future value of the development will be considerable.
Whatever your strategy, make sure you put down a solid plan that you feel comfortable with and set up a professional team to help you achieve your goals.
Jo Chivers is director of <a href="https://www.propertybloom.com.au/" target="_blank" title="Property Bloom">Property Bloom</a>, which manages property development.
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How to know when to sell and when to hold a new development

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Last week we ran a massive race.  It could be said it was the grand prix of property purchases.    You see, I found a really, really fabulous development site for my client and there was no time to waste as I realised that the property was way under priced!
It all started with a call from the agent.  “I’m listing a property you might be interested in, Jo,” she said.  The grin on my face broadened as I asked a few crucial questions. What were these questions?
There were five:
What is the land size? I was told 1,000 square metres (it was actually 1,039 square metres)
How many rooms does the house have?  FOUR (most houses in this suburb are two- or three-bedrooms)
What’s it renting for? $265 per week (ears prick up...Wow, this is way under-rented!)
Where is it? Did I hear you say “on the corner”? Yes, it was a corner block!
What is the listing price?  $270,000...hmmm I knew a four-bed house on 500 square metres (more than half the land) had recently sold for $272,000 a few doors up and it was not a corner block.
As I asked these questions and even though I actually received some incorrect answers, my heart was pounding.  I knew this was an extraordinary property.   As luck would have it, I was going to be in the Hunter the very next day so I could check it out immediately.
I sweetly asked the agent, “Can I inspect the property tomorrow?”  After a few hours wait, the answer came by email: No, not yet as the contract had not been received, although they had a signed agency agreement.   I picked up the phone and after a few minutes’ chat, I had gleaned the address of this property.
The next day I could think of nothing else as I hit the freeway.  My curiosity was soon satisfied as I stood at the fence, peering through the bushes to grab photos of the property we were soon to secure for our client.
Had I not had a good relationship with this agent, I might not have been able to get the address. But she knew that my clients were always strong purchasers.  As part of our process, before a client even signs up with Property Bloom, we ensure they have done three things:
-          Sought independent financial advice to ensure property development is the right strategy for them.
-          Had a preapproval from their lender on figures relating to the type of development we’d be project managing for them.
-          Discussed the correct structure to purchase under and tax implications with their accountant.
So we were able to move quickly, before this property had officially hit the open market. We had a two-day head start.  We knew the property would hit the internet sites and be advertised in the local newspaper very soon, so time was of the essence.
I took lots of photos and rang my surveyor. Had he done a survey on this property in the past?  Sometimes I find this to be the case and we can obtain a copy of an old survey. But, today he said he had no”.
I rang my client and told him my feelings about this property.  The house had a lovely Federation-style with wrap around veranda. The large corner block was a no brainer.  But, even without seeing the contract, I knew that the zoning for this suburb was changing to low density under a proposed Draft LEP.  In the past we could have lodged a DA to build a duplex behind the house and complete a two-lot Torrens Title subdivision. But I knew this was no longer an option. I had developed in this very street before, so I knew where the sewer main ran.  I knew rental demand was strong.  Most importantly, I also knew that being a corner block with kerb and guttering on just one boundary meant that the council would condition kerb and guttering to be completed on the other boundary as part of the DA consent if we were to lodge a DA for a subdivision.  While the block was large enough to subdivide, this cost of approximately $30,000 to $50,000 for 50 metres of kerb and guttering including the bitumen sealing of the very wide road shoulder could kill the project.  This was the deciding fact for me.  An inexperienced punter, not knowing the local council requirements, may have easily found themselves in hot water.
The answer for this site was a strong yield creating development strategy and we would build a two-bedroom granny flat to supplement the four-bedroom house.  This would not overdevelop the block and leave adequate outdoor living space around each dwelling.  We would not be asked to upgrade the road as part of this complying development.  The property was opposite a school, the four-bedroom house would rent to a family with kids needing some yard space and the two-bedroom flat may well be rented by a retired couple of a single parent.
So with a little freshen up renovation, paint and new carpet, the house will rent for $350 per week. Remember we paid just $270,000 for it (full asking price was our very quick second offer, before the property was “officially on the market”). It will cost us $90,000 to build our granny flat and this will rent for $270 per week.  The result is a 9% gross yield for my client.
By this time, we were well and truly sprinting to exchange.  I knew as soon as this property hit the open market there would be mega interest in it. Little did I know, it would also be the catalyst for some very unscrupulous agent activity.  We later found out that one local agent who did not have a sales agreement with the vendor tried to gazump us by talking directly to the vendor telling them he could bring them a buyer above asking price.  You can only imagine how the listing agent reacted to this!
That’s why we were sprinting.  Within five days we had received three crucial pre-purchase documents:
-          pest &amp; building report
-          Ident survey
-          Bank valuation and unconditional loan approval
My client’s conveyancer had to hound the vendor’s solicitor to make them act fast and move to exchange as quickly as possible.  They didn’t know what had hit them. Usually it’s the other way around with the vendor pushing to exchange.  My job was to keep all parties fully informed so everyone knew that my client was moving as quickly as physically possible to exchange. This communication process was crucial in the success of the deal.   The vendor had told the agent to keep the property on the market until it was exchanged.  So if for one minute, the agent thought we were moving too slowly, he could well have taken another offer to their vendor.
My message from this experience to you is: run loudly and fast, and don’t ever let things go quiet!  Manage the process till the end if you want to ensure you buy that property.   As they say, it’s not over till the fat lady sings or in other words, until you sign the contract and exchange takes place!
Jo Chivers is director of <a href="https://www.propertybloom.com.au/" target="_blank" title="Property Bloom">Property Bloom</a>, which manages property development.
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Pounce on opportunities quickly or you will miss out

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This week I was really excited to find a fabulous property that we could add value to.  “Add value? In what way,” I hear you say.  Perhaps you are thinking through renovation – new kitchen, new bathroom, paint throughout, perhaps a deck out the back or even maybe add another bedroom?  Yes, this kind of work would usually add value to a property.  But actually, I was thinking along other lines and two words had sprung to mind: granny flat.
By adding a granny flat to this property, we could literally double the rental return.
This four-bedroom house, in a Hunter Region of NSW town, was renting at $260 per week.  But as soon as I saw it, I knew it could achieve much more. It is a large block, more than 1,000 square metres, with dual access.  By building a 60-square-metre, two-bedroom granny flat on the property it could be rented for around $270 per week on its own, just for the flat.  But it does get better – the house is way under-rented.  You see, I’m finding right now that as rental markets have continued to tighten over the past few years, there are some owners and managing agents who haven’t bothered to increase rents. This house was being rented by a long-term tenant and quite frankly, she is on a very good wicket!  The market rent in this town for a four-bedroom house is actually up to $350 per week.  So the house is under-rented by a whopping $90 per week.
So if we spruce up the house a little, and this one only needs a paint and new carpet, we can increase the rent to $350 per week.  The purchase price is $250,000 and we may spend $8,000 of a cosmetic reno, so already that’s gives us a 7% gross yield. Not a bad return when the average yield for houses in Sydney, for instance is 4.18%.
The granny flat will cost us $92,000 to build, this includes the design and complying development application fees. It also includes separate service connections for the flat so that we can rent it to a different tenant to the house if we need to. Remember, the flat will rent for $260 per week.  If we add the cost of the flat to the purchase price of the house plus the small renovation costs, and include purchasing costs of stamp duty, legal fees, reports etc then we end up with a gross yield of around 9%.
Did I already mention that the average rental yield on houses in Sydney is around 4.18%?
OK, here is the twist. If you have a self-managed super fund or are thinking of setting one up, you may be able to do all this from within your fund.
On September 14, 2011 the ATO released draft Ruling SMSFR 2011/D1 clarifying its views on key issues surrounding borrowing arrangements (Limited Recourse) as they apply to self-managed super funds, allowing fund monies to be used to renovate property.
Importantly the ATO has given clarity to concerns of fund trustee’s in regards to repairs, renovations and improvements to properties held in SMSF’s under Limited Recourse borrowing arrangements. It is clear these can now be done within such arrangements. Borrowed monies cannot be used in all cases for such work; however other monies within the SMSF can be utilized.
This information comes from Nic Ellis, director of The 2020 Group, who tells me he’s had more enquiry than ever on this topic.  People want to utilize their Super to not just invest in property but to renovate and add value.  With such a volatile global situation and stock market, Australians want more security around their retirement funds.  Nick says he’s happy to see the draft Ruling as it falls in line with his company’s interpretation. The SMSF Limited Recourse borrowing for purchase of property has seen significant growth in recent years and this draft ruling will help turbo charge this sector of the market.
However, the area remains complex and care needs to be taken to ensure expert advice, appropriate structures and experienced administration of this process. Click <a href="https://go2020.com.au.tmp.anchor.net.au/index.php?pageID=10#sectionStart" target="_blank">here </a>if you want clarity on this.
Jo Chivers is director of <a href="https://www.propertybloom.com.au/" target="_blank" title="Property Bloom">Property Bloom</a>, which manages property development.
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How a granny flat can double your rental returns

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Last week I presented the pros and cons of Strata vs. Torrens Title subdivision for a dual-occupancy project.

For this project, we are building two free-standing homes. The land is not a corner block, so one home is positioned behind the other and they will share a common driveway.

Our first response was to try and achieve a two lot Torrens Title subdivision because it’s what most people understand when purchasing houses.  Strata subdivision tends to be associated with multi unit developments, rather than house-and-land projects.

But, when you think about it, if you have two houses sharing a common driveway, then there should be some formal arrangement on who is going to pay for the upkeep of the driveway.  A strata subdivision covers this off, while a Torrens subdivision leaves driveway maintenance up in the air or for owners to fight over. 

[smartcode_project:default project_id=21618]

We asked our surveyor to set up the strata plan giving each house its own land on title, minimising common areas to the driveway and the dividing fence between the two houses.  Being a small, two lot strata subdivision; it means that we’d be exempt from the more formal strata management of larger schemes.  As the houses are freestanding and have their own yards, it is quite a simple process. 

If our client, on completion of the development decides to hold both houses, they may also decide not to even register their subdivision immediately. We would have the approval in place and this has no shelf life, so they could register the subdivision years down the track when and if they decide to sell. 

If they decide to sell one house and keep one, after registering the subdivision, all costs for managing, maintaining, repairing and insuring the common property are shared by the owners in direct proportion to their lot's respective unit entitlements. In this case it is an equal share; each lot has one unit entitlement, so it is very straight forward to manage. Each owner is responsible for 50% of any costs to repair or maintain the driveway/common area. 

Small strata schemes (two lots)

The special provisions for 2-lot schemes are:

<ul>
<li>the two owners automatically form the executive committee, removing the requirement for an election</li>
	<li>a quorum for all meetings is when the 2 owners are present</li>
	<li>Building insurance is not compulsory where the two buildings are detached and there are no additional buildings on common property. However, both owners must decide to forgo insurance cover by unanimous resolution at a meeting. Each owner may then insure the structure on their own lot.</li>
	<li>If the buildings are detached, the owners can decide not to have a sinking fund provided there are no additional buildings on common property. Both owners must decide this by unanimous resolution at a meeting.</li>
</ul>
With the advent of the compulsory 10-year sinking fund plan legislation, 2-lot schemes managed to get special consideration. Essentially, a 2-lot scheme doesn't need to have a sinking fund.

[smartcode_project:default project_id=28070]

Finally, there are no requirements for two-lot schemes to have any audit of accounts and financial statements. Reference: <a href="https://www.strataman.com.au/">www.strataman.com.au</a> 

Property Bloom found by setting up the strata title subdivision in the right way that it was the better way to subdivide. Not only does a small strata subdivision (two lots) cost a lot less in development costs than a two lot Torrens subdivision, it is also a much quicker process.

The winner is, in our books is a strata subdivision for a dual occupancy where there is a shared driveway.

Jo Chivers is director of <a href="https://www.propertybloom.com.au/" target="_blank" title="Property Bloom">Property Bloom</a>, which manages property development.
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Why a strata subdivision is better than a Torrens title subdivision for some developments

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In 2009 the NSW government released a new policy that has been well accepted by most property owners, including investors and owner-occupiers. The Affordable Rental Housing – State Environmental Planning Policy (SEPP) is encouraging people to build more granny flats. 
The new policy introduced by the NSW government is a fabulous strategy, as it allows more property owners to add value to their homes or investments in the short and long term.  From a development perspective, it can be a quick and easy way to build your property portfolio and create high rental yields. Owners can benefit from cash-flow from the rent on two dwellings and also receive good depreciation benefits on the new flat.  This means people can keep moving forward with their investment strategy.  Unlike buying a single apartment for instance, which is likely to be negatively geared, adding a granny flat to a property that already has an existing dwelling can result in a cash-flow positive situation. 
In the past granny flats were only permitted in certain residential zones, but this SEPP has opened up a whole new real estate door. The aim of the granny flat is to boost the supply of affordable rentals by providing housing for the elderly so families can support each other, as well as the younger generation who are living at home and are not in a position to move out just yet. 
Government projections show us that single-person households are likely to be the fastest growing sector over the next 20 years, so demand is definitely there.
Small secondary dwellings are an attractive option for singles and couples who don't need a lot of room and are the most likely people to be under rental stress. Young people are also staying at home longer, and granny flats can provide extra space for them and be a lifesaver for baby boomers who were hoping to empty their nest some time soon.
This policy means that if you have a block over the size of 450 square metres you are able to build a granny flat no larger than 60 square metres on your existing property; you may get approval in approximately 10 days as long as complies with the council’s regulations. Not only will this add value to your home, but you can rent out the flat and do your bit to assist the chronic rental shortage we are seeing not only on the northern beaches but across NSW. 
Property Bloom focuses on developing property, including granny flat developments, in the Hunter Region due to its affordability and strong, diverse economy.  The area is earmarked for long term growth in the NSW government’s Lower Hunter Regional Strategy. The 25-year plan, provides for 160 000 new residents and 66 000 new jobs. With the existing mining, retail, construction, tourism, low unemployment rate and low rental vacancy rates, the Hunter Region ticks all the boxes for a strong region to be investing in. 
We are finding properties for around $220,000 that may need a small cosmetic renovation of around $5,000. These projects are creating a 9% to 10% gross rental yield.  This type of development suits someone starting out in developing or an investor looking to create a cash flow positive investment.
To take advantage of the NSW government’s Affordable Rental Housing - State Environmental Planning Policy (SEPP) the regulations include:
<ul>
<li>Granny flat must be no more than 60 square metres in size</li>
<li>Land must be more than 450 square metres</li>
<li>Can only be one house and one granny flat on the land</li>
<li>The land cannot be subdivided</li>
<li>Will need to comply with LEP of your council (contact council re building requirements)</li>
<li>It meets the requirements of the Building Code of Australia</li>
</ul>
For more information go to:
<a href="https://www.planning.nsw.gov.au/">www.planning.nsw.gov.au</a>
Jo Chivers is director of <a href="https://www.propertybloom.com.au/" target="_blank" title="Property Bloom">Property Bloom</a>, which manages property development.
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Granny flats a great way to feather or empty your nest

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I’m often asked why I continue to focus my developing efforts in the Hunter region of New South Wales.  Good question.  It’s been nine years since we started working in the area, and I continue to be amazed at the research we uncover.  When you are a developer you need to understand the dynamics of the areas you will invest in.  As I’m sourcing sites and project managing developments for my clients, I need to be sure that the projects will be in the right locations. So I’ll explain a few of the reasons why the Hunter continues to be my shining star.
Firstly, the Hunter region is currently feeling the pressure from the much-publicised “lack of housing” situation in Australia.  My agents are telling me the same story over and over.   “Jo,” they say, ”We can’t get enough quality rental stock, hurry up and finish that development, would you!”
One of the reasons we are seeing rental markets in the Lower Hunter continue to tighten is the billions of dollars’ worth of infrastructure projects currently underway which is creating hundreds of jobs for both local and new residents.  One three-bedroom house that Property Bloom renovated as part of the overall development a few months ago in Stanford Merthyr, a suburb in Cessnock, was purchased for $210,000 and was rented quickly for $325 per week to contractors working on the Hunter Expressway.  The Newcastle Herald reports that there are 133 major projects worth $2.61 billion under way in the past year, with the majority taking place in the Cessnock local government area.
In Muswellbrook, Property Bloom has gained approval for dual-occupancy projects, and we are about to start building.  Each time I update my feasibility the rental estimates increase. These clients will end up with close to an 8% gross yield and create a large amount in equity by developing in this town.  Here, it’s the mining industry that is contributing to the desperate cry for housing, with employees moving to the town from all over Australia and even from New Zealand.  Several mines are undergoing expansion in Muswellbrook.  Contractors come to the area to work on the development works and then one the expansions are complete they will be replaced by full-time workers as the mines increase their capacity.
John Boyle of John Boyle Real Estate in Muswellbrook reports: “We have limited land releases available for the amount of growth in the area. This growth is mainly coming from construction employees who are working on infrastructure in the area and mining support and services.”
“We have only six homes for rent at the moment. Before the homes are completed, they have been rented. We need the developers to get a move on and finish their developments,” Boyle says. 
This lack of housing is ticking all the boxes and bringing investors to the area, as they can see the potential growth destined for this area. BIS Shrapnel expects median house prices to rise a further 18% by 2014.
Leading Australian construction analyst Cordell Information reports there are 310 major civil projects in the pipeline for the region, with most of those planned for the Newcastle LGA. The boom is being led by Upper Hunter mine expansion and earthworks, major road and rail projects and BHP site remediation work.
With Maitland the fastest-growing inland town of NSW over the past few years, we are always looking for potential sites in this area.  We recently found a 2,000-square-metre piece of land where we’ll be building six villas for our client.  This area is earmarked by the council for ongoing growth, and Maitland has all the facilities you need in a town to support the fast growing population increase.
Todd Fisher from LJ Hooker Maitland says the lack of housing for current and potential employees is distressing.   “I feel sorry for tenants, as there is a 1% vacancy rate. It is not unusual for us to have 50+ people at an open house. It is unbelievable,” Fisher says.
“The mining industry is bringing in a lot of new blood especially from Western Australia, Queensland and New Zealand.”
To top it all off, there is the most beautiful tourist attraction in the form of the vineyards and rolling green countryside that makes up the Hunter Valley. In addition to the wine industry, we see tourism growing substantially from the ongoing famous concerts in the vineyards, where international artists such as Elton John, Fleetwood Mac, Meatloaf, Dolly Parton, Rod Stewart to name a few  come to perform. In addition there are spa, health and golf resorts and large five-star hotel chains that have launched into what was not long ago a bed &amp; breakfast market.
For me, the main sparkle for this region is affordability.   It’s one of the important factors that will drive the region in the short term, with a median price well under all our capital cities, the Hunter will continue to shine on.
Jo Chivers is director of <a href="https://www.propertybloom.com.au/" target="_blank" title="Property Bloom">Property Bloom</a>, which manages property development.
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Infrastructure and mining make Hunter region a good place for investment

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This week I sat around a table with a group of very important people.  Why were they so important?  They are the people who, at this stage of our development, could make a massive difference in the result of our project.
We were there to brainstorm the best way to build six villas on a 2,000-square-metre block of land that I had sourced for my client.
This land is in a suburb of Maitland in the Lower Hunter Region. The main driver at the moment of this suburb is one of NSW’s largest infrastructure projects under construction right now: the Hunter Expressway. It will have an interchange less than three kilometres away.  So people living in this suburb will have very quick access onto the F3 to get to Newcastle or Sydney. They could also live in this town and still work in one of the large coal mines, as travel time to Branxton on the New England Highway will be cut. Another driver for this suburb is that the town of Maitland has been the fastest-growing inland town in NSW for the past few years. So there is good demand in this market.
OK, back to the meeting.  The most important person there was my client, let’s just call him Jim. While obviously important to me, he should be congratulated for taking on what is a very exciting property development. Jim has vision and can see the potential that I do in this project. Jim has a clear strategy: to create wealth through developing property as quickly as he can.  He understands he has a set number of years before he retires and he doesn’t want to muck around. This is Jim’s second development with Property Bloom, so he is well on his way. If all goes to plan (which is what the meeting was about) Jim will come out with a very handsome amount of equity that will be created through the development project. He can use this to pay down any personal debt and continue to build his property portfolio.
Also at the meeting was our town planning consultant. This man has invaluable experience working with the council and gave us a clear strategy on how to tackle the DA. This was not straightforward, as we need to consider the lending criteria and stage the DA in the correct way so it can be financed.
Next to him was our architect.  When I met him, I was impressed to find out he used to be a carpenter.  This meant he had actually worked on a building site!  This is a rare find, so I immediately thought he was pretty important.
Our builder has been in the game for over 20 years and bought along his construction manager, who is very experienced and manages all the builder’s projects. I thought this was a great initiative, as this guy is going to be directly overseeing our build, so what a great idea to include him at the design stage.  I recon he’ll take ownership having been involved at this level.
Also in attendance was the builder’s senior estimator who is the man who prices every aspect of the project, every square and lineal meter of it so very important to have him there as he could tells us the areas where the big costs lay.
The final person was one of my project managers who had managed many projects not just for Property Bloom but for other builders so he has a strong understanding of the way builders work and also in the planning phases.
I had called the meeting as we had just received a price back from the builder on our initial concept plan and we wanted to see how we could bring down the costs to increase the profit.
The architect, construction manager and the estimator started bouncing off each other on the engineering of the two double story villas, was there a way to decrease the metal beams required?  Did we need double story - yes.  We were happy with the floor plan design of the villas, so our focus switched to the site levels and the extent of the retaining required. There was some fall on the land which meant the development would be stepped. It wasn’t long before an agreement was made to minimise the height of the walls so that they didn’t need to be engineered by clever slab design and site preparation. We talked about the best and most cost effective way to subdivide the villas and then discussed maximising the street appeal and front façades of the villas.
The table was buzzing, and I found myself quietly reflecting on how lucky I was to do this for a job. I loved the interaction between my team and pondered on the value of the accumulated expertise of the people I had on my side.
We left the meeting on the final note of an amount that we’d be happy to wipe off the costs; the architect would proceed with more detailed plans and work with the estimator to ensure he had the details to deliver the next round of costings.  The solutions that were found in that one hour meeting are very exciting.
So don’t try and tackle a property development on your own, as Oprah says, you can be lifted higher by others. Get yourself a great team of experts that you can rely on and enjoy the process.
Jo Chivers is director of <a title="Property Bloom" target="_blank" href="https://www.propertybloom.com.au/">Property Bloom</a>, which manages property development.
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Property development is a team effort

Roseville is poised for a wave of new apartment development following the NSW Government's rezoning of land around Roseville Station under its Transport Oriented Development program.

The new planning controls have unlocked significant development potential within walking distance of the station, with a number of sites expected to be amalgamated and redeveloped in the coming years as developers seek to take advantage of the increased density allowances.

One of the more restrained developments in the precinct, and set among the first to be delivered having commenced well before the recent changes, is Hyecorp's Juliet. The boutique apartment project is already well under construction and remains on track to welcome residents by the end of the year, offering a markedly different proposition to many of the larger-scale developments now likely to emerge across the suburb.

[smartcode_project:default project_id=7395 project_image_fid=278194]

<a href="https://www.apartments.com.au/new-apartments/juliet-roseville-64-pacific-highway-roseville-nsw-2069">Juliet</a> will comprise just&nbsp;34 one-, two-, and three-bedroom apartments opposite Roseville Station. For Hyecorp, which has delivered projects across Sydney's Lower North Shore for more than three decades, Roseville presented a rare opportunity to address a growing gap in the market.

"<a href="https://www.apartments.com.au/developments/roseville-nsw-2069">Roseville</a> has long been one of the North Shore's most tightly held and desirable suburbs, offering a unique combination of village charm, established greenery, excellent transport connections, and proximity to some of Sydney's best schools and lifestyle amenities," Hyecorp said.

"We recognised a growing demand from local homeowners seeking to downsize without leaving the community they have built their lives around. The location presented a rare opportunity to create homes that cater specifically to that buyer profile."

[smartcode_project:default project_id=7395 project_image_fid=278196]

The six-level development has been designed by <a href="https://www.apartments.com.au/architects/pbd-architects">PBD Architects</a> as a collection of residences that feel more like homes than apartments. The brief centred generous floorplans, abundant natural light, quality finishes, and strong connections to outdoor space.

PBD Architects drew inspiration from Roseville's established garden suburb character, creating a building that sits comfortably within its surroundings rather than dominating them. The architecture incorporates natural materials, soft forms, layered landscaping, expansive balconies, and generous setbacks to strengthen the connection between residents and the suburb's leafy environment.

"The focus was on designing spacious, house-like residences for discerning owner-occupiers and downsizers who wanted to remain on the North Shore without compromising on comfort, privacy, or design," PBD said.&nbsp;

"Every apartment was to feel considered, timeless, and highly functional."

[smartcode_project:default project_id=7395 project_image_fid=278195]

Inside, residences feature engineered timber flooring, stone kitchen benchtops and splashbacks, integrated Fisher &amp; Paykel appliances, ducted air conditioning, and large outdoor entertaining areas designed to take advantage of district and treetop views.

Residents will also have access to a rooftop barbecue and lounge area, alongside practical amenities including parcel lockers, EV charging capability, bicycle storage, a dog wash bay, and a basement car wash facility.

The majority of purchasers so far have been local owner-occupiers from Roseville, Lindfield, Chatswood, Killara, and the broader Upper North Shore, many of whom are transitioning from larger family homes.

"Buyers are looking for spacious, house-like apartments that allow them to downsize without feeling like they are sacrificing comfort or functionality," Hyecorp noted.

"They value large kitchens, generous living areas, ample storage, quality finishes, secure parking, lift access, and low-maintenance living."

[smartcode_project:default project_id=7395 project_image_fid=278204]

Juliet sits directly opposite Roseville Train Station and within walking distance of Roseville Village, while Chatswood's retail and dining precinct is only minutes away. The development is also surrounded by some of Sydney's most established schools, including Roseville College, Ravenswood, Pymble Ladies' College, and Knox Grammar, as well as nearby parklands and golf courses.

Juliet is currently more than 75 per cent sold ahead of its anticipated completion in late 2026.

[smartcode_project_cta:default project_id=7395]

Joel Robinson

Juliet to sit quietly amid Roseville apartment boom

Sherpa Property Group has unveiled the third instalment of its Flourish series, securing full approval for the two-tower, $500 million Flourish Soleira development in Palm Beach.

<a href="https://www.apartments.com.au/new-apartments/flourish-soleira-1150-1154-gold-coast-highway-palm-beach-qld-4221">Flourish Soleira</a> will rise from a prominent site in the commercial heart of Palm Beach, the long-time home of Cash Converters and a range of local retailers.

The project will introduce a new retail and dining precinct at ground level, beneath 286 apartments.

[smartcode_project:default project_id=150017 project_image_fid=370959]

“We’re very committed to not only providing affordable residential offerings that are much needed in Palm Beach, but also delivering a vibrant new commercial heart that complements the extraordinary growth of the southern Gold Coast,” Sherpa Property Group founder Christie Leet said.

The development will sit under Sherpa's Flourish brand, which is aimed at providing a pathway into the beachside suburb for locals, first-home buyers and downsizers. In a move designed to assist first-home buyers entering the market, Sherpa has reserved all one and two-bedroom, one-bathroom apartments exclusively for eligible first-home buyers.

[smartcode_project:default project_id=150017 project_image_fid=370964]

“Our vision through Flourish is to create a vibrant retail and lifestyle focal point within the Palm Beach centre zone, delivering thriving communities underpinned by lifestyle-rich locations,” Leet said.

“So far, Flourish has been an incredible success, and we hope to carry this momentum as we progress the next two Flourish projects in Palm Beach.”

[smartcode_project:default project_id=150017 project_image_fid=371430]

Located across 1150-1164 Gold Coast Highway and 3 Sixth Avenue, the development will comprise two towers. The northern tower will deliver 154 apartments, while the southern tower will add a further 132 residences, helping address ongoing demand for new apartments in the tightly held coastal suburb.

Flourish Soleira will also feature the most extensive rooftop amenity offering ever delivered in Palm Beach.

The two towers will be connected by a skybridge, with residents gaining access to a rooftop recreation deck featuring a full-width swimming pool, hot and cold plunge pools, wellness spaces, a gymnasium, private dining facilities, massage treatment rooms, barbecue areas, a basketball court, golf simulator, indoor and outdoor dining spaces, sun lounges and extensive landscaping.

LPS Group is expected to start construction later this year.

Sherpa is already well advanced on construction of its debut Flourish project, Flourish Amargo, located just around the corner from Soleira. Meanwhile, Flourish Oasis, positioned opposite Amargo, recently commenced construction and has nearly sold out its collection of 47 apartments.

[smartcode_project_cta:default project_id=150017]

Sherpa unveils $500m mixed-use Palm Beach precinct, Flourish Soleira

Are mortgage holders set to get a reprieve from the RBA in 2026?

Big Four bank NAB believes so. They are now expecting the next move from the RBA to be a cut, rather than a hike, which they had pencilled in for August. They are unsure of the timing of the cut however, they note in their latest&nbsp;NAB Economics RBA Watch.

NAB Chief Economist, Dr Sally Auld, said recent data suggests the economy has lost momentum and the outlook for rates has shifted, noting that the broader economic backdrop has changed since earlier in the year.

“The next move in the cash rate is likely to be down, but the timing is uncertain," Dr Auld said.

"In February, growth was above trend, the economy was operating above capacity and there was uncertainty over the restrictiveness of rates. None of these conditions exist today,” she outlined.

Dr Auld said recent data pointed to softer momentum across the economy while acknowledging that at the same time, uncertainty remains a key feature of the outlook.

“Both Q1 GDP data and the NAB business survey suggest momentum in the economy has slowed, meaning that growth has likely peaked for the cycle. That said, we are cognisant there is still considerable uncertainty around the outlook, both with respect to activity and inflation.”

Dr Auld said inflation risks and labour market outcomes would be important to watch.

“On the prices side, we are still forecasting above target core inflation through to mid-2027. Margins will compress and weaker labour market outcomes are a risk.”

She said tighter financial conditions are expected to weigh on housing and activity.

“Tighter financial conditions will be reflected in a slowing in house price growth and housing credit growth. In summary, we have greater conviction that the next move in rates is down, but less conviction on the timing.”

Mortgage relief? NAB forecasts RBA rate cut, not hike, after softer economic conditions

A local downsizer has splashed $6.5 million on a penthouse in Perifa's Alex &amp; Willow development in Crows Nest. 
&nbsp; 
The purchaser sold their long-held family home in the area before embarking on a six-month search for the right apartment. After inspecting a range of options across the Lower North Shore, the buyer returned to <a href="https://www.apartments.com.au/new-apartments/alex-willow-crows-nest-82-90-alexander-street-crows-nest-nsw-2065">Alex &amp; Willow</a>. 
&nbsp; 
The buyer profile reflects the project’s broader purchaser mix. <a>Alex &amp; Willow</a> has attracted predominantly local downsizers looking to transition from larger homes without compromising on space or quality, alongside a smaller cohort of upsizers and investors drawn to the project’s location and design credentials. 
&nbsp; 
The milestone sale comes as the project, developed by&nbsp;<a href="https://www.apartments.com.au/developers/perifa">Perifa</a>&nbsp;and delivered by <a href="https://www.apartments.com.au/builders/versatile-made-construction">Versatile Construction</a>, both part of Versatile Group, reaches 60 per cent sold.

[smartcode_project:default project_id=6680 project_image_fid=371325] 
&nbsp; 
Eddie Mansour, Managing Partner of <a href="https://www.apartments.com.au/project-marketer/ray-white-projects">Ray White Projects</a>, said the result demonstrates not only a headline price but also depth of demand. 
&nbsp; 
“This is an exceptional outcome and a clear reflection of sustained buyer demand for premium, well-located downsizer product,” Mansour said.

“We’re seeing a consistent pattern of local homeowners selling family residences and reinvesting into high-quality apartments that allow them to remain within their community. Alex &amp; Willow has resonated strongly with this group because it offers genuine scale, thoughtful design and immediate proximity to the village.” 
&nbsp; 
The sale reflects a broader and consistent trend of local downsizers actively seeking high-quality, low-maintenance residences close to established village centres. Agents report that demand for this product type has remained resilient, particularly where developments offer a rare combination of scale, design quality and walkable amenity. 
&nbsp;&nbsp; 
Fabrizio Perilli, Managing Director of Perifa and Versatile Group, said the sale marks a defining moment for the project. 
&nbsp; 
“The penthouse sale is a strong endorsement of the quality we have delivered, alongside our partners, and the clear demand from local downsizers for premium, boutique residences in this location,” Perilli said.&nbsp; 
&nbsp; 
“Most importantly, we’re proud to see the Alex &amp; Willow community beginning to take shape. As we move closer to completion, we’re looking forward to welcoming residents and seeing the project come to life.”&nbsp;

[smartcode_project:default project_id=6680 project_image_fid=338516] 
&nbsp; 
Designed by <a href="https://www.apartments.com.au/architects/nettletontribe">Nettleton Tribe</a> with interiors by <a href="https://www.apartments.com.au/interior-designers/richards-stanisich">Richards Stanisich</a>, Alex &amp; Willow is a boutique collection of generously sized two- and three-bedroom residences in the heart of Crows Nest village.&nbsp;

Completion is slated for early 2027.

[smartcode_project_cta:default project_id=6680]

Alex & Willow, Crows Nest penthouse sells off the plan for $6.5 million

Fresh from launching the first stage of its Wollongong precinct, <a href="https://www.apartments.com.au/new-apartments/keira-place-wollongong-120-122-smith-street-wollongong-nsw-2500">Keira Place</a>, builder-developer Urban Property Group has unveiled plans for the next phase of the masterplanned community.

Now on public exhibition through the NSW Government's Housing Delivery Authority pathway is a State Significant Development Application for a further 657 homes on the prominent gateway site opposite Beaton Park.

The proposal comprises three buildings, including two build-to-sell towers rising 25 and 30 storeys, delivering 391 apartments, alongside a 12-storey co-living building with 266 residences, making it one of the largest co-living proposals currently planned in regional New South Wales.

Of the apartments proposed in the build-to-sell towers, the majority, 310, are two-bedroom dwellings. The balance comprises 44 one-bedroom apartments and 37 three-bedroom residences. Apartment sizes range from around 50 sqm for one-bedroom homes to approximately 90 sqm for three-bedroom apartments.

<img alt="Smith St" data-entity-type="file" data-entity-uuid="19347059-1612-41a0-9c74-b86a657237f8" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-06-10%20at%2010.02.18%E2%80%AFAM.png?VersionId=sWXnaCcA.cIC6N8YT1dg5pJ2e1V3Z6z7" />

The submission says the proposal has evolved significantly from its original Housing Delivery Authority application following extensive consultation with the State Design Review Panel and Wollongong City Council.

The final scheme has been designed to align with the emerging vision for the Flinders Street Precinct, an area identified by Council as a future high-density mixed-use neighbourhood capable of accommodating substantial housing growth close to transport, employment and community infrastructure.

According to the design report prepared by COX Architecture, the development aims to "deliver a built outcome consistent with the future character of the Wollongong CBD while responding to the site's unique constraints and opportunities."

"Our vision for the next phase of the site evolution in Wollongong is grounded in three design pillars that guide the design response: place, natural environment and celebration," COX said.

"Inspired by its surroundings and grounded in the stories of place on Wodi Wodi Country, the design proposal acknowledges the established character of its setting while creating a unique and timeless identity that sits harmoniously within it.

"The design proposal responds to its specific site conditions, acknowledging the vegetation, climate, wind conditions and solar access of the site."

The architecture responds directly to the site's position between Wollongong's urban core and its natural landscape setting.

COX identified views towards Mount Keira and the Illawarra Escarpment as defining features of the site, while the upper levels of the towers will also capture expansive views across the city and out to the Pacific Ocean.

The design team has positioned the tallest buildings closer to the rail corridor, where overshadowing impacts can be better managed while establishing a landmark built form on the northern approach into the city.

<img alt="Smith St" data-entity-type="file" data-entity-uuid="79580d5b-500c-4ebf-9629-797146a4a694" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-06-10%20at%209.51.59%E2%80%AFAM.png?VersionId=WbTB1EKSG.KDfsfz0F3wp1QVa2oCMGR5" />

Urban Property Group secured the 11,000 sqm Smith Street site in 2022 and has since progressed plans for the broader Keira Place precinct.

Construction recently commenced on the first stage of Keira Place, which will deliver 150 apartments across two residential buildings, including 27 affordable housing apartments and 18 specialist disability accommodation dwellings, alongside activated ground-floor retail and commercial space.

Urban Co-CEO Patrick Elias said the commencement of construction marked a significant milestone for Wollongong and reflected the developer's long-term commitment to regional cities.

"Today's groundbreaking is about turning approvals into homes and moving quickly to deliver much-needed housing in Wollongong's city centre," Elias said.

"Keira Place will provide a diverse mix of homes close to jobs, transport and services, while setting a high benchmark for quality, durability and consumer protection."

Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/groundbreaking-marks-start-of-construction-at-keira-place-in-wollongong-cbd">Groundbreaking marks start of construction at Keira Place in Wollongong CBD</a>

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Jo Chivers

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