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SPONSORED POST
It is no secret that Macquarie Park has been a favourite amongst Australia’s leading property developers and investors with AMP, Goodman, Stockland and the like all taking a substantial stake in the precinct.
Since the early days in the mid 1960’s when the bushland suburb of North Ryde was rezoned for employment land, developers and prospective investors have found solace in the safe havens of Macquarie Park which has transformed into the “Silicon Valley of Sydney” with global tech and software giants such as Microsoft, Oracle and Novartis calling it home.
Macquarie University was built in the early 1960’s as Sydney’s much needed third university, construction of residential dwellings then transpired around the fringes and soon after Macquarie Shopping Centre opened for business which proved to be a major draw card for international and domestic businesses. Since then, Macquarie Park has positioned itself as a power house in the commercial market with over 850,000 square meters of office space creating a work force of over 45,000 and with a competitive 7 percent vacancy rate.
Since 2015 when the Herring Road Precinct was rezoned, we have seen a new form of investment with local and international residential developers acquiring all the newly re zoned land with over $1 billion dollars being transacted since 2015. According to the NSW Government there is over $2.7 billion in Development Applications awaiting approval with a substantial amount also in the pipeline.
The newly created strata laws brought into effect on 1 December 2016 has proven to be the catalyst for site amalgamations in the Herring Road precinct.
Savills Residential Site Sales Directors Stuart Cox and Neil Cooke have been instrumental in amalgamating these sites and have recently taken <a href="https://commercialpropertysearch.savills.com.au/bc8f85aa-9be2-e611-80c7-005056813885/Sale/Macquarie-Park/Macquarie-Park" target="_blank">15-19 Cottonwood Crescent</a> to market with an outstanding response from international and local developers in the first couple of days.
<img src="https://www.urban.com.au/images/2017/06/06/Screen%20Shot%202017-06-07%20at%209.36.43%20AM.png" alt="" width="570" height="359">
This site encapsulates three existing blocks of 15 two bedroom apartments, capable of being redeveloped into a landmark 21 storey 200 unit development under the current development controls.
According to Stuart Cox, “The re-gentrification of Macquarie Park will be home to over 10,000 new dwellings in the next 10 years with residents benefiting from the governments heavy involvement in upgrading public infrastructure through integrated transport connections and improving transport times to and from Sydney and Parramatta CBD’s.”
Strong demand for Macquarie Park has always stemmed from its education and retail backbone that has provided for over 40,000 students and 45,000 employees, new demand stems from the proximity to Sydney and Parramatta CBD’s through the new Metro Sydney Project which will provide trains every four minutes in peak hours.
Macquarie Park is also the second largest employment region in NSW and the fourth largest CBD in Australia with employment figures by BIS Shrapnel quoting a growth of over 40,000 new jobs by 2031. Residential developers have recently been acquiring sites at rates well in excess of $3,500 per square meter of Gross Floor Area for the privilege to own and develop in the extremely hot Herring Road Precinct.
This article was written by Johnathon Broome, Savills Residential Site Sales Executive.
For more information from Savills, <a href="https://www.savills.com.au" target="_blank">click here</a>.
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jchancellor-FAypfDUnLy

Billionaires play in the Park

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GUEST OBSERVER
We need more justification around the NSW Government’s solution for housing affordability after it revealed no concessions would be afforded to buyers making property purchases over $800,000.
The measures, taken to cabinet last week, proposed stamp duty would be abolished on all homes up to $650,000 and relief to buyers of homes up to $800,000.
My offices are already experiencing vendors around both the $650,000 and $800,000 price points asking agents to list their homes for slightly more, given that first home buyers will soon have more to spend. 
When first home buyer grants were introduced a few years ago, as a group, we saw the same thing. The market needs to find its natural level, as otherwise these measures could prove counter-productive and possibly even lead to an artificial increase in prices.
The new measures certainly look like a step in the right direction, but we need to stop the applause and critique the performance. It is a complex matter, as the State Government needs to protect the cash cow that is stamp duty, but also make an attempt at solving the affordability crisis.
If the intention is to alleviate affordability woes amongst first home buyers, how did it reach the figure of $650,000? This tells me the measure was designed to drive more first home buyers into apartments.
With far fewer investors as a result of the macro-prudential measures and tens of thousands of new apartments in the pipeline, who is going to buy them otherwise?
Sydney’s median dwelling price is $872,300 – two thirds the figure proposed for abolishing stamp duty, and according to CoreLogic, 20 percent of Sydney Metro dwellings sold at a price of $650,000 or less over the past 12 months were houses.
This rises to 34.4 percent when looking at dwellings that sold for a price of $800,000 or less.
Last year, the apartment development boom raised concerns about an apartment oversupply in Sydney. The stamp duty changes are designed to drive more first home buyers into apartments. 
First home buyers currently represent about four to five percent of the market. We need to get this to double digits and this measure might not do that.
When you really look at it against the market, less than 10 percent of Sydney’s suburbs would have homes with a median price below $650,000.
If the Government was serious about alleviating barriers, it would completely abolish stamp duty for first home buyers or at the very least make the first $650,000 exempt, irrespective of the purchase price, and not cap it at a price that forces people into apartments to reverse engineer the cycle. 
In addition to believing first home buyers be exempt from paying stamp duty, they should have to reside in the property to be eligible. 
However you spin it, rentvestors are still investors, and we have been overly advocating rentvesting as a wealth strategy, which is taking its toll on the market.
The base of the affordability iceberg is that there have been too many investors in the market and unless we’re careful, these measures could inadvertently make things worse. It is further exacerbating the problem which APRA has tried so hard to alleviate. 
If the Government is not open to completely abolishing stamp duty for first home buyers on all properties, concessions should at least be tracked against median house prices annually. 
House prices are relative against the cost of living – someone in the Eastern suburbs might pay more for property compared to someone in Western Sydney, but they are usually paying more for everything – not just property. Therein lies the problem – the affordability crisis is a Sydney issue, not necessarily a State issue. 
Regional NSW first home buyers are set to benefit the most from this, but what about buyers in Sydney’s Inner West, Lower North Shore, Eastern Suburbs and the South?
If you are looking to buy in these areas and hoping to benefit from the abolishment of stamp duty for properties up to $650,000, you can either uproot your life, don’t buy at all, or buy a garage.
DOUGLAS DRISCOLL is CEO of real estate agency <a href="https://www.starrpartners.com.au/" target="_blank">Starr Partners</a>.
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Budget failing many buyers: Douglas Driscoll

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<img src="https://counter.theconversation.edu.au/content/78830/count.gif?distributor=republish-lightbox-advanced" alt="The Conversation" width="1" height="1">
GUEST OBSERVER
With the release of the March quarter national accounts, there have been reports the Australian economy could break the Netherlands’ “world record” for continuous growth. But there are three problems with this assertion.
It’s now been 103 quarters (25 years and 9 months) since Australia last had consecutive quarters of negative growth in real gross domestic product (GDP), in the March and June quarters of 1991. 
Contrary to much-repeated claims, the Netherlands didn’t experience more than a quarter-century of economic growth without consecutive quarters of negative real GDP growth between the early 1980s and the global financial crisis.
<a href="https://www.propertyobserver.com.au/images/2017/06/06/Screen%20Shot%202017-06-07%20at%208.04.52%20AM.png" target="_blank">Click to enlarge</a>
<img src="https://www.urban.com.au/images/2017/06/06/Screen%20Shot%202017-06-07%20at%208.04.52%20AM.png" alt="">
The Netherlands’ real GDP declined by 0.3 percent in the June quarter of 2003, and by 0.01 percent in the September quarter of that year, according to data published by Statistics Netherlands and, separately, by the OECD. So, at best, the Netherlands went for only 22 years without experiencing a recession. Australia surpassed that benchmark in 2013.
Yes, that second quarterly decline in 2003 was almost imperceptible. But sporting records are delineated by margins as small as one one-hundredth of a second, so we can’t blithely discount a -0.01 percent fall in real GDP as “not relevant”.
Even if you blinked and missed that tiny second successive decline in real GDP in the September quarter of 2003, the Netherlands still wouldn’t hold the record for the longest run of continuous economic growth. That belongs to Japan – which, according to OECD data, went from the March quarter of 1960 to the March quarter of 1993 without ever registering two or more consecutive quarters of negative growth in real GDP. That’s 133 quarters, or more than 33 years. 
Indeed, if Japanese GDP data were available on a quarterly basis earlier than 1960 it’s likely that this run of continuous economic growth would have been even longer, perhaps as long as 38 years, inferring from annual data available back to 1955. So Australia would need to avoid consecutive quarters of negative real GDP growth until at least 2024 if it is truly to be able to claim this “world record” as its own.
<a href="https://www.propertyobserver.com.au/images/2017/06/06/Screen%20Shot%202017-06-07%20at%208.06.30%20AM.png" target="_blank">Click to enlarge</a>
<img src="https://www.urban.com.au/images/2017/06/06/Screen%20Shot%202017-06-07%20at%208.06.30%20AM.png" alt="">
Even more importantly, the definition of a technical recession as (two or more consecutive quarters of negative growth in real GDP) is, as former RBA Governor Glenn Stevens said, “not very useful”. It was originally proposed in December 1974 by Julius Shishkin, who at that time was the head of the Economic Research and Analysis Division of the US Census Bureau (now the Bureau of Economic Analysis, which publishes the US national accounts). 
It’s not used to identify recessions in the US. It takes no account of differences over time, or as between countries, in the rates of growth of either population or productivity – which are the key determinants of whether a given rate of economic growth is sufficient to prevent a sharp rise in unemployment. This is something which most people (other than economists) would use to delineate a recession.
While Australia has avoided consecutive quarterly contractions in real GDP since the first half of 1991, we’ve had two periods of consecutive quarterly declines in real per capita GDP (in 2000 and 2006). We’ve also had two periods of consecutive quarterly declines in real gross domestic income or GDI, which takes account of income gains or losses accruing from movements in Australia’s terms of trade (in 2008-09, and in 2014). Perhaps most meaningfully of all, Australia has had two episodes where the unemployment rate has risen by one percentage point or more in 12 months or less (in 2001 and 2009).
That’s still a better track record than almost any other advanced economy during the past quarter-century or so – and it reflects well on the quality of economic management (and the nature of our luck) over this period. Nonetheless, we shouldn’t be in the business of awarding ourselves prizes to which we’re not entitled.
Saul Eslake is vice-chancellor’s Fellow, University of Tasmania and author for The Conversation. He can be contacted <a href="https://theconversation.com/profiles/saul-eslake-665" target="_blank">here</a>.
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There’ll be no records set this week by Australian economic growth figures: Saul Eslake

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Statement by Philip Lowe, Governor: Monetary Policy Decision
At its meeting today, the Board decided to leave the cash rate unchanged at 1.50 percent.
The broad-based pick-up in the global economy is continuing. Labour markets have tightened further in many countries and forecasts for global growth have been revised up since last year. Above-trend growth is expected in a number of advanced economies, although uncertainties remain. In China, growth is being supported by increased spending on infrastructure and property construction, with the high level of debt continuing to present a medium-term risk. Commodity prices are generally higher than they were a year ago, providing a boost to Australia's national income. The prices of iron ore and coal, however, have declined over recent months as expected, unwinding some of the earlier increases.
Headline inflation rates in most countries have moved higher over the past year, partly reflecting the higher commodity prices. Core inflation remains low, as do long-term bond yields. Further increases in US interest rates are expected over the year ahead and there is no longer an expectation of additional monetary easing in other major economies. Financial markets have been functioning effectively.
Domestically, the transition to lower levels of mining investment following the mining investment boom is almost complete. Business conditions have improved and capacity utilisation has increased. Business investment has picked up in those parts of the country not directly affected by the decline in mining investment. Year-ended GDP growth is expected to have slowed in the March quarter, reflecting the quarter-to-quarter variation in the growth figures. Looking forward, economic growth is still expected to increase gradually over the next couple of years to a little above 3 per cent.  
Indicators of the labour market remain mixed. Employment growth has been stronger over recent months, although growth in total hours worked remains weak. The various forward-looking indicators point to continued growth in employment over the period ahead. Wage growth remains low and this is likely to continue for a while yet. Inflation is expected to increase gradually as the economy strengthens. Slow growth in real wages is restraining growth in household consumption.
The outlook continues to be supported by the low level of interest rates. The depreciation of the exchange rate since 2013 has also assisted the economy in its transition following the mining investment boom. An appreciating exchange rate would complicate this adjustment.
Conditions in the housing market vary considerably around the country. Prices have been rising briskly in some markets, although there are some signs that these conditions are starting to ease. In other markets, prices are declining. In the eastern capital cities, a considerable additional supply of apartments is scheduled to come on stream over the next couple of years. Rent increases are the slowest for two decades. Growth in housing debt has outpaced the slow growth in household incomes. The recent supervisory measures should help address the risks associated with high and rising levels of indebtedness. Lenders have also announced increases in mortgage rates, particularly those paid by investors and on interest-only loans.
Taking account of the available information, the Board judged that holding the stance of monetary policy unchanged at this meeting would be consistent with sustainable growth in the economy and achieving the inflation target over time.
<a href="https://www.rba.gov.au/media-releases/2017/mr-17-12" target="_blank">The RBA statement</a>.
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First signs housing price growth was easing: RBA Governor Philip Lowe's June 2017 statement

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GUEST OBSERVER
Mega-trends such as urbanisation and technology are set to have a profound effect on our basic living habits and homes.
In this instalment of our ‘Homes of the Future’ series, we look into how our living rooms will need to adapt for the future. 
The look and feel of the space
With increasing urban populations, the spaces that we live in may become increasingly smaller. 
The design of the space may change, shifting to designs with less clutter and visual noise. Theo Richardson, an industrial designer and co-founder of Rich Brilliant Willing, believes we will see simpler lines, bold forms and bold solid colours.
Business Leader at IKEA Eja Tuominen explains that people want to slow down and relax, and therefore are focusing on living areas around the themes of growing, creation, harmony and compact living, ensuring calm spaces are present as part of the design. 
Multi-functionalism
Other changes we expect to see will be furniture that is more transformable and multi-functional. Future furniture should have integrated technology to make it more responsive both ergonomically and via bio-feedback. For example, a couch may adjust configuration depending on whether there are guests present or if you are relaxing by yourself.
Technology and entertainment
Looking at the future of living rooms, whilst the basic functions will remain the same, the increasing role of technology will change our traditional modes of communication and entertainment. For example, instead of sitting and chatting with friends in person or over the phone, you may instead be speaking to them via hologram. Instead of watching television or playing console games, you may be involved in virtual reality experiences.
Imagine a living room with complete integration between appliances and architecture. At the Consumer Electronics Show, Sony explored a conceptual living room where a mirror became a touchscreen panel, syncing to the wall which transformed into a giant screen, with overhead lighting that projected films. 
Immersive entertainment experiences are already being investigated by many brands, including Microsoft Research’s IllumiRoom video which brings to life the potential of film and game projections coming out of the TV, and Xbox One’s enhanced Kinnect sensor allowing participatory fitness and leisure products with personalised coaching in the home.
Another enhancement we may see in the near future is adding a fourth dimension (motion) to home entertainment – allowing our furniture to move and vibrate in conjunction with our entertainment to allow for a more immersive experience.
Ged Rockliff is the Head of Residential, Savills, and can be contacted <a href="https://www.savills.com.au" target="_blank">here</a>.
 
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How will urbanisation and technology affect living rooms of the future? Ged Rockliff 

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<img src="https://counter.theconversation.edu.au/content/77784/count.gif?distributor=republish-lightbox-advanced" alt="The Conversation" width="1" height="1">
GUEST OBSERVER
In its 2017 federal budget, the Australian government included a 0.06 percent levy on Australia’s biggest five banks: ANZ, the Commonwealth, NAB, Westpac and Macquarie Bank.
The levy will collectively cost the banks A$1.6 billion a year, and by some estimates will raise the overall cost of funding for the affected banks by around 0.03 percent. Many commentators have suggested this cost will be passed directly onto customers.
In an interview on the ABC’s Insiders program, Treasurer Scott Morrison said the banks could absorb the cost of the levy, given the size of their profits.
He said Australia’s large banks have between a 0.2 percent to 0.4 percent advantage because of the way Australia’s regulatory regime works and that Australian banks have a return on equity about twice that of banks in other advanced developed economies.
Is that right?
Checking the source
When asked for sources to support his statement, a spokesperson for Scott Morrison referred The Conversation to evidence presented by the Reserve Bank of Australia to the House of Representatives Standing Committee on Economics at its hearing on September 28, 2016.
In the report, the Reserve Bank included a chart provided below.
The spokesperson added that:
Importantly, the chart doesn’t adjust for M&amp;A [mergers and acquisitions] activity, given NAB’s 2016 sale of Clydesdale brings down average (unadjusted) ROE [return on equity] for Australian banks quite substantially.
Let’s check the facts.
What is the return on equity for Australian banks?
Return on equity, or ROE, is a measure of profit, expressed as a percentage of shareholder equity. It shows how much profit a company generates with the funds invested by its shareholders.
The figure below (from the Reserve Bank’s Financial Stability Review) shows the return on equity of the large banks in Australia was around 15 percent in 2015.
Including the smaller Australian banks, which have about 20 percent of the market, the average return on equity is somewhat lower and more variable than for the big four only, but it is above 12 percent.
<a href="https://www.propertyobserver.com.au/images/2017/05/19/return%20on%20equity.png" target="_blank">Click to enlarge</a>
<img src="https://www.urban.com.au/images/2017/05/19/return%20on%20equity.png" width="452" height="425">
A decade ago, Australian bank returns on equity were a few points higher, and not much different from those earned by banks in other developed markets.
However, during the global financial crisis, banks in the US and Europe sustained large losses, leading to negative returns for couple of years. US banks have since recovered somewhat. European and UK banks, however, continue to perform weakly: the returns on equity of large banks in Europe are about 5 percent, compared to about 3 percent in the UK. The ROEs of large Canadian banks have, like those of large Australian banks, remained higher and more stable.
Looking ahead, the Reserve Bank notes that:
Analysts’ expectations are for Australian banks’ [return on equity] to remain on average around 12.5 percent over the next couple of years. While this is high by international standards and appears to be above banks’ cost of equity, it is lower than the returns to which Australian banks and their investors have become accustomed. Do Australia’s biggest banks have an added advantage over smaller rivals?
The treasurer also claimed that “our major banks have about a 20 to 40 basis point [funding cost] advantage because of the nature of the regulation and structure of our financial system”.
Big banks do indeed appear to be able to borrow more cheaply because their lenders expect them to receive government support during crises.
In 2010, the International Monetary Fund (IMF) used a range of approaches to estimate the value of “implicit government support” – such as the bailouts provided to some US banks during the global financial crisis – for banks and other financial institutions in the Group of 20 nations, including Australia.
While the answers from the different approaches varied, the IMF concluded that implicit government support “provides too big to fail financial institutions with a funding benefit between 10 and 50 basis points, with an average of about 20 basis points”.
Here in Australia, the Reserve Bank has concluded that “the major banks have received an unexplained funding advantage over smaller Australian banks of around 20 to 40 basis points on average since 2000”.
Macquarie University researchers James Cummings and Yilian Guo found that the funding cost advantage was about 30 basis points from 2004 to 2013, but has declined to about 16 to 17 basis points since then, in part due to prudential reforms that obliged banks to increase the share of lending contributed by shareholders.
Verdict
Scott Morrison was correct: Australian banks do “have a return on equity which is about twice, if not more than that, what you see particularly in other parts of the advanced developed economies of the world”.
Australian banks currently have higher returns on equity than banks in many other major developed markets. Those returns are about twice as high or more than the returns of the troubled European and UK banks. But returns in Canada are close to the Australian level, and the returns earned by large US banks are only a few points below the Australian level.
The treasurer is also correct to point out that the major banks enjoy a funding cost advantage on the basis of expected government support in financial crises. However, the size of the support is less clear. While IMF and RBA studies are in line with the treasurer’s range, there is some evidence that the funding cost advantage may now be somewhat lower.
Jim Minifie is Productivity Growth Program Director at the Grattan Institute. You can follow him on Twitter <a href="https://twitter.com/jimminifie?lang=en" target="_blank">here</a>. 
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Do Australian banks have double the return on equity of banks in other developed economies?

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<img src="https://counter.theconversation.edu.au/content/78452/count.gif?distributor=republish-lightbox-advanced" alt="The Conversation" width="1" height="1">
GUEST OBSERVER
Contrary to what Labor and the banks have predicted, revenue from the bank levy will likely be higher, even with deductions.
In this year’s budget papers, Treasury estimated that the bank levy will collect about A$1.5 billion in each of the next four years for the government. But this is actually a conservative estimate.
Labor has argued there will be a A$2 billion dollar hole in the bank tax revenue. This is based on the disclosure to the ASX of four of the five affected banks, on what they will likely pay government.
But the banks’ numbers assume there won’t be change to any decisions in response to the bank levy. Research shows this is highly unlikely, as bank customers have worn the cost for bank taxes like this, imposed after the global financial crisis in the UK.
In fact, if the economy keeps growing as many have predicted, and banks grow too, then the amount of revenue the government collects from the levy may even be bigger than Treasury estimates.
<h2>What we know about the bank levy</h2>
When it comes to what revenue the government can get from the bank levy, both the taxable sum, and the tax rate applied, determine what gets collected.
The budget papers specify the taxable sum as including “items such as corporate bonds, commercial paper, certificates of deposit, and Tier 2 capital instruments” but not “Tier 1 capital and deposits of individuals, businesses and other entities protected by the Financial Claims Scheme”. The bank levy will be an annualised rate of 0.06%, applicable for all licensed entity liabilities of at least A$100 billion from July 1, 2017. Small banks and foreign banks are exempt.
Although it is possible the bank levy would not be a deductible expense in calculating corporate income, precedent and statements by government indicate the levy will be deductible. Special taxes on the mining industry (including royalties and the petroleum resource rent tax), state payroll, land taxes, stamp duties and indirect taxes such as petroleum excise are all deductions in the calculation of taxable corporate income.
<h2>Errors in the assumptions about banks</h2>
Labor and banks also assume that the bank levy is a deduction in assessing corporate income. The preliminary data made public by four of the five affected banks indicates the gross revenue gain of the bank levy, less the reduction in corporate tax, will be less than the budget numbers.
That is, the net revenue reflects a 0.042% levy rather than the 0.06% rate. This also assumes shareholders will bear all of the net additional taxation.
But it also assumes the banks will not change any decisions. This is both a simplistic and an unlikely scenario.
In essence, the bank levy is a selective indirect tax on one of the inputs used by the large banks to provide financial services to their customers.
A more likely scenario is that the banks will seek to, and succeed in, passing forward most of the new indirect tax to their customers as a combination of higher interest rates and fees. From past experience, banks pass forward higher Reserve Bank of Australia (RBA) interest rates, just as they pass forward lower rates.
Given that the affected five banks account for over 80% of the market, together with the reluctance of most Australian business and household customers to switch banks, there is a high probability that most of the levy will be passed forward as higher bank interest rates and fees.
Should the banks pass forward most of the levy to their customers, the increase in bank revenue will match the increase of bank costs caused by the levy. That is, taxable corporate income will remain about the same. Then, the overall government revenue gain is given by the gross 0.06% bank levy.
<h2>The bank levy could even collect more</h2>
If the output and incomes of the five banks to pay the levy expand over the next four years, then we would expect additional revenue to be collected by government to increase over time. The budget papers, the RBA, international agencies and private sector economists all forecast economic growth. It’s unlikely that the big five banks would not also experience economic growth.
So the budget paper forecast that the bank levy revenue collection of about A$1.5 billion a year for each of the next four years, has to be on the conservative side.
The revenue estimates for the levy are forecasts or projections compiled in a world of uncertainty. So a lot is still up for debate, including not only the design of the levy but the future path of the economy in general and for the large banks in particular.
Details and assumptions underlying government estimates of the revenue from the bank levy are unclear. It would be an unusual precedent not to allow the levy to be a deduction in calculating corporate income tax, and so reducing the net revenue gain. But the implicit assumption of the bank released numbers of no decision changes by the banks is unrealistic.
If banks, as businesses in general, pass forward to customers much of an input tax, a large part of the first-round fall in corporate income, is offset by higher revenue. Government forward estimates of additional government tax revenue collected by the levy likely are on the conservative side.
John Freebairn is a Professor in Department of Economics, University of Melbourne and the author for The Conversation. He can be contacted <a href="https://theconversation.com/profiles/john-freebairn-90" target="_blank">here</a>.
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The government will likely get more from the bank levy than Labor or the big four think: John Freebairn

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GUEST OBSERVER
Economic indicators for Australia look benign – at least for the moment.
Recent revisions to their economic forecasts by leading financial institutions reveal that another quarter of economic contraction, following the September quarter 2016, may be on the cards. Last month’s budget is unlikely to significantly alter the outlook, nor are the developments overseas.
The RBA Shadow Board continues to advocate a hold-and-wait policy. It attaches a 56 percent probability that this is the appropriate setting.
The confidence attached to a required rate cut equals 3 percent, while the confidence in a required rate hike equals 42 percent.
Headline inflation, which increased to 2.1 percent in the March quarter, lies comfortably within the Reserve Bank of Australia’s official target range of 2-3 percent.
Australia’s seasonally adjusted unemployment rate fell to 5.7 percent in April, according to the Australian Bureau of Statistics, with the economy adding more than 35,000 jobs. However, this increase was due entirely to a swell in part-time employment as full-time employment contracted by nearly 12,000.
Nominal wage growth continues to remain subdued. In fact, in the March quarter real wages fell by 0.2 percent.
The Aussie dollar, relative to the US dollar, recently fell below the 74 US¢ mark, with some financial market analysts predicting a breach of the 70 US¢ threshold before the end of the year. Yields on Australian 10-year government bonds continue to slide; they now equal 2.4 percent. Domestic share prices have pared their recent gains, with the S&amp;P/ASX 200 stock index trading below 5,800.
Commodity export prices dropped a considerable 6.8 percent in May; they are now more than 10% below their January peaks. Even though mining investment increased slightly for the first time in nearly three years, it is expected to fall 22 percent in the year ahead, based on ABS surveys. Non-mining firm investment is expected to increase by 3.7 percent in the same period.
Internationally, there exists no stand-out news item to help guide policy. Economic statistics from Europe and the US look favourable but geostrategic conflicts, uncertain elections and unpredictable US policy could change this swiftly. China is unlikely to experience another round of double-digit growth rates. On the contrary, there remains the possibility that the debt overhang and structural adjustment will further slow the economy.
Consumer and business confidence remain modest. Other measures of economic activity such as capacity utilization, retail sales and inventory behavior remain tightly range-bound.
The Shadow Board’s policy preferences have barely nudged since last month. It is 56 percent confident that keeping interest rates on hold is the appropriate policy, one percentage point down from May.
It attaches an unchanged probability of 3 percent that a rate cut is appropriate and a 42 percent probability (40 percent in May) that a rate rise, to 1.75 percent or higher, is appropriate.
The probabilities at longer horizons are as follows: 6 months out, the estimated probability that the cash rate should remain at 1.50 percent equals 23 percent, unchanged from the previous round.
The estimated need for an interest rate decrease is up two percentage points, from 4 percent to 6 percent, while the probability attached to a required increase equals 71 percent (73 percent in May).
A year out, the Shadow Board members’ confidence that the cash rate should be held steady equals 14 percent (17 percent in the previous month), while the confidence in a required cash rate decrease edged up from 4 percent to 7 percent and in a required cash rate increase remained unchanged at 79 percent.
<a href="https://www.propertyobserver.com.au/images/2017/06/06/Screen%20Shot%202017-06-06%20at%209.46.55%20AM.png" target="_blank">Click to enlarge</a>
<img src="https://www.urban.com.au/images/2017/06/06/Screen%20Shot%202017-06-06%20at%209.46.55%20AM.png" alt="">
More information from the CAMA RBA Shadow Board can be found <a href="https://cama.crawford.anu.edu.au/rba-shadow-board" target="_blank">here</a>.
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Hold and wait best policy: RBA Shadow Board

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Sydney's property boom is now in its fifth year - an unusually long period with unusually high price growth.
But the May auction results suggest there's been a light tap on the breaks.
The slightly lower Saturday auction success has contributed to the current thinking that we've perhaps seen the peak. 
But which peak?
Last weekend Ryde recorded the strongest clearance rate of 90 percent from 46 auctions, but Blacktown, with half the volume, secured just 55 percent.
The overall Sydney figure was 76 percent.
There's so many markets across Sydney each having their own telling characteristics.
As a buyer or seller in the market, it is important to take note of the suburban, citywide and national trends, as they all contribute to the commentary which shapes sale outcomes.
Despite it being at the pricier end of activity, auction trends are a portent of the wider property market direction.
There are indicators that cover the private treaty market.
Some of these have yet to suggest any shift in sentiment, but these to tend to lag auction momentum so should emerge over coming months.
Days on market for Sydney private treaty sales sits at a speedy 28 days, the nation's fastest market, CoreLogic advise. The buying discount off the vendor asking price is just four percent.
Stock on market is up six percent suggesting a bumper winter selection for buyers.
The latest CoreLogic figures show supply of established housing stock for sale is at the highest level for this time of year since 2012.
Estate agent John McGrath senses the booming market has turned.
"Demand softens because prices get to such a high point after a long period of growth that buyers start giving up and exiting the market."
Would-be upgrader buyers choose to stay put and renovate or extend because they feel trading up is just too difficult.
"Whether this new data from CoreLogic indicates a turn of the cycle or a blip, we don’t yet know," McGrath said.
But his feeling is that Sydney is at, or around, its peak for the cycle.
"We’re certainly overdue for a period of price consolidation, which I continue to believe is a healthy sign for the market.
"Vendors are still in the driver’s seat but this won’t last forever, especially if demand is on the way down."
Along with the auction and private treaty market, there is another major segment, separate but also infectious, which is off the plan apartment offerings.
One index I like is the number of residential cranes on the Sydney skyline. According to the latest count, there are 34 more over the past six months. The 292 cranes total account for 53 percent of all Australian residential cranes, the RLB Crane Index indicated. 
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May auction results suggest Sydney's property boom may be slowing

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SPONSORED POST
If the wealth of lifestyle TV shows proves one thing, it’s that good presentation means extra dollars when it comes time to sell or rent your investment property.
Professional cleaning is one of the cheapest and easiest improvements you can make and it delivers a big bang for your buck when you want to make a good market impression, according to James’ Home Services, one of Australia’s leading residential cleaning companies. 
CEO Mike Dowling said: “When you are coming up to finalise a sale, you are faced with the everything from legal issues to building inspections. There’s no doubt cleaning is one of the easiest jobs you can offload to the professionals.
“But professional cleaning offers much bigger benefits for property owners that just saving them time.
“Most buyers look for a property they can move into straight away and pristine presentation gives them confidence that the rest of the property is in good repair.
“Tenants too will often pay a premium for spotless presentation. If you’re in a competitive market, they will choose clean, fresh premises over similar accommodation that isn’t as well presented. It also means you are more likely to attract the best tenants.” 
Mr Dowling said keeping on top of maintenance was essential for happy tenants and an important consideration when it came to insurance too, as insurers often refused to pay claims if poor maintenance was thought to be a contributor.
“Overflowing gutters, for example, can lead to roof leaks, poor cleaning can shorten the life of expensive appliances like air conditioners and ovens, dirty exhaust fans can encourage moisture build up and mould, and a green pool is a real turnoff, so it’s essential to take care of these things regularly,” he said.
“Professional cleaners have the skill and equipment to do the work to a better standard and in a fraction of the time than property owners can do themselves - so it makes good business sense.” 
When you consider that total office investment sales volumes for 2015/16 were $15.91 billion and 500,000 homes change hands each year in Australia, that is a lot of homes and offices that need to be spruced prior to sale.
Fortunately for property buyers and sellers, arranging end of lease and pre-sale cleans has never been easier.
“I’ve been in the cleaning industry for almost a quarter of century and know that I have some of the most skilled people in the industry out there in the field,” said Mr Dowling, who purchased James’ Home Services in October 2015.
“Most professional cleaning services will back their work. Our Gold Medal Service Guarantee is one of the best because we ensure you can speak to a real person who can identify your needs and the service you require, organise a free quote at a time that best suits you and we turn up when we say we will every time. We also offer a 7 Day workmanship guarantee so if you’re not satisfied, we will come and fix for no extra cost.
“James’ Home Services is dedicated to delivering results that are step above the rest and are determined to deliver professional results in every aspect of our business.”
Visit <a href="https://www.jameshomeservices.com.au" target="_blank">www.jameshomeservices.com.au</a> to learn more about the services offered and to book either a one- off or regular visit from one of the James’ Home Services franchisees. 
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Cleaning a settlement issue solved with James' Home Services

One of North Sydney's best-known commercial buildings could become hundreds of new homes, with insurance giant Zurich Australia lodging a State Significant Development Application (SSDA) to transform 5 Blue Street into a mixed-use residential development above North Sydney Station.

Rather than demolishing the existing building and starting again, Zurich is proposing an adaptive reuse project that would convert the landmark office building into a 15-level residential development delivering 62 apartments, 86 affordable co-living dwellings, activated retail and significant upgrades to the Blue Street Plaza.

The proposal reflects a growing trend of commercial property owners repositioning ageing office assets into residential housing as Sydney grapples with housing supply shortages and changing workplace demand.

<img alt="Zurich" data-entity-type="file" data-entity-uuid="0bba7d12-06dc-4375-aad7-238c94b21ac5" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-22%20at%2010.42.05%E2%80%AFAM.png?VersionId=NJl5oLAEBDGuPmY3RnyliKODjMc8lvRh" />

Located directly above North Sydney Metro and train station, the 3,051 sqm site occupies one of the most strategically positioned parcels of land on Sydney's Lower North Shore.

Designed by fjcstudio, the proposal seeks to retain and adapt much of the existing structure while creating a contemporary residential address that better connects with the public domain surrounding North Sydney Station.

The application proposes two basement levels, ground floor retail, affordable co-living accommodation across the podium levels, and apartments above, while preserving and enhancing the publicly accessible Blue Street Plaza.

Rather than pursuing maximum apartment numbers, Zurich has opted for a housing mix heavily weighted towards larger owner-occupier residences.

The proposal includes 62 build-to-sell apartments comprising 12 one-bedroom, 19 two-bedroom, 29 three-bedroom apartments and two premium penthouses. It also incorporates 86 affordable co-living dwellings, which would be managed in perpetuity by a Community Housing Provider.

That balance between traditional apartments and affordable housing reflects the NSW Government's push to increase housing diversity around major transport infrastructure.

The proposal has been lodged concurrently with a rezoning application, with Zurich arguing the site is ideally positioned to support additional housing given its immediate proximity to public transport, employment and services.

"The proposal aims to respond to the housing challenges facing Sydney through the delivery of diverse housing types in a highly accessible location," the design report by fjcstudio states. It also seeks to improve pedestrian amenity through upgrades to Blue Street Plaza while creating a high-performing residential building that responds to the surrounding context.

<img alt="Zurich" data-entity-type="file" data-entity-uuid="36082e15-c636-4481-bb68-5a5f6443fe39" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-22%20at%2010.41.36%E2%80%AFAM.png?VersionId=5P6VD.fvmqjQfIG3TWWMRXxQWiQBjeFB" />

Rather than replacing the commercial building, fjcstudio has developed a design that works with the existing structural framework above the rail corridor, an approach that significantly reduces demolition while allowing the site to be repositioned as a mixed-use residential precinct.

The existing structural constraints have informed much of the building's design, including its relationship with Blue Street and surrounding public spaces.

The building has been designed as a slender tower rising above a clearly defined podium, with vertically expressed façades intended to reduce the perceived bulk while reinforcing North Sydney's emerging skyline.

According to fjcstudio, the architectural language responds directly to the surrounding commercial towers while maintaining a finer grain expression more closely aligned with the neighbouring Lavender Bay streetscape.

The tower incorporates articulated façade elements, landscaped podium edges and recessed upper levels to soften its appearance and improve pedestrian amenity below.

A significant component of the proposal is the revitalisation of Blue Street Plaza.

The existing public space has long served as one of the primary pedestrian connections between North Sydney Station, Greenwood Plaza and Blue Street, yet its role is expected to become even more important following the opening of Sydney Metro.

Zurich's proposal seeks to strengthen that role by improving landscaping, introducing new retail frontages, enhancing pedestrian permeability and creating more active edges throughout the day and evening.

Ground floor retail would wrap the plaza, while separate residential and co-living entries have been designed to improve wayfinding without reducing street activation.

Landscape design has been integrated throughout the podium and public realm, softening what is currently one of the most heavily urbanised parts of North Sydney.

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fjcstudio has carefully oriented apartments towards Sydney Harbour and the CBD while using privacy blades and articulated façades to minimise overlooking between neighbouring buildings.

Large framed openings along the western elevation maximise harbour outlooks, while the eastern apartments have been angled towards the south-east to improve privacy from neighbouring development.

The project forms part of the continuing transformation of North Sydney from a predominantly commercial CBD into a genuine mixed-use city centre.

Since the completion of Victoria Cross Metro Station, developers have increasingly shifted their attention towards residential projects capable of leveraging the area's unparalleled transport connectivity.

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FiveX recently lodged plans for a 61-storey, 490-apartment tower that would become one of the tallest residential buildings in North Sydney if approved.

Aqualand continues to expand its Lower North Shore presence following the completion of AURA on Walker Street and its recent St Leonards and Roseville proposals.

Developers are also progressing projects throughout Walker Street, Miller Street and the Victoria Cross precinct as demand for well-located owner-occupier apartments continues to strengthen.

Joel Robinson

First look: Zurich targets North Sydney office conversion with 148-unit proposal above Metro station

Busy developer Aqualand Prestige has formally taken the next step in its expansion across Sydney's Lower North Shore, lodging a State Significant Development Application (SSDA) for its long-held Archer Street site in Chatswood.

The application covers <a href="https://www.apartments.com.au/new-apartments/51-55-archer-street-chatswood-nsw-2067">51-55 Archer Street</a>, a 1,767 sqm amalgamated site on the eastern edge of the Chatswood CBD, where the developer is seeking approval for a 45-level mixed-use tower delivering 114 apartments, including a significant affordable housing component, alongside retail, commercial space and six basement levels of parking.

The SSDA marks the latest milestone for a project Aqualand has been quietly progressing over the past two years. The developer first secured the site for its Aqualand Prestige platform before undertaking an alternative design excellence process with PTW Architects, ultimately avoiding a formal design competition through the Housing Delivery Authority pathway.

The proposal has evolved considerably from Aqualand's original concept. The revised scheme has been designed around larger owner-occupier product, with an unusually high proportion of three and four-bedroom apartments, targeting the more affluent buyer profile, and downsizer, emerging across the North Shore.

<img alt="Archer St" data-entity-type="file" data-entity-uuid="0171204c-5811-41b5-9b09-2335d1b7c3d0" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-22%20at%208.52.48%E2%80%AFAM.png?VersionId=6YTuxfq.puZo7k2wbfgemcO5K3QfXYGQ" />

The 114-apartment mix comprises six studios, 27 one-bedroom apartments, 18 two-bedroom apartments, 50 three-bedroom residences and 13 four-bedroom homes. A quarter of the building will be dedicated to affordable housing, well above the mandated 15 per cent&nbsp;

PTW has structured the building vertically, with affordable housing across levels one to six, premium apartments through levels seven to 31, duplex skyhomes on klevels 32 to 43, a penthouse on level 44, and a rooftop plant level above. Six basement levels will provide resident parking and servicing.

The tower is proposed to reach approximately 154 metres, placing it among a growing collection of residential high-rises transforming Chatswood's skyline.

Rather than competing purely on height, PTW says the design has been driven by creating a slimmer tower capable of delivering significantly larger apartments.

"The primary objective of this project was to create a distinctive building that stands out from the recently approved or built structures in the Chatswood area," the design report states, noting the structural efficiency allows greater investment into apartment quality and resident amenity.

Residents would have access to more than 450 sqm of communal open space including landscaped gardens, swimming pool, rooftop entertaining areas, fitness spaces, community gardens, children's play areas and barbecue facilities.

A major focus of the design has been the public domain.

The ground plane has been opened up through landscaped terraces inspired by Willoughby's sandstone ridges, with native planting, public seating, artwork, retail activation and a series of gathering spaces intended to soften what has traditionally been a hard commercial streetscape.

The landscape strategy references Blue Gum forests once common throughout the area, while incorporating Indigenous storytelling, public art and lighting installations to strengthen the connection to Country.

Chatswood has been one of Sydney's busiest apartment markets over the past 12 months, with a steady pipeline of both new project launches and fresh development applications.

Hyecorp recently launched Celine, a 122-apartment development just along Archer Street, while Changfa and Huirong Group are progressing The Anderson, an 84-apartment project on Anderson Street.

Develotek recently secured approval for a 101-apartment tower on Pacific Highway, while Tian An LFD received the green light for Hammond Greens, its apartment development on the edge of the Chatswood Bowling Club.

Commercial property developer FiveX is also making its move into the residential market. Last month it lodged plans for a 61-storey tower with 490 apartments, which, if approved, would become one of the tallest residential buildings in Chatswood.

Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/first-look-fivex-targets-chatswood-skyline-with-61-storey-tower-after-north-sydney-plans">First look: FiveX targets Chatswood skyline with 61-storey tower after North Sydney plans</a>

Aqualand is also expanding its development pipeline following the launch of its luxury residential brand, Aqualand Prestige. The developer has delivered a string of high-end apartment projects across Sydney's affluent suburbs over the past decade, most recently AURA by Aqualand on Walker Street in North Sydney.

[smartcode_project:default project_id=30959 project_image_fid=292863]

It has since quietly assembled its next wave of projects.

Earlier this year Aqualand launched Boronia in Roseville, a boutique 111-apartment development on Larkin Street. The project is one of the first significant apartment developments to launch in the suburb ahead of what is expected to become one of Sydney's most active new housing precincts under the NSW Government's Low and Mid-Rise Housing reforms, which allow greater density around train stations.

[smartcode_project:default project_id=152095 project_image_fid=373685]

The developer has also lodged plans for a two-tower, 413-apartment development on Herbert Street in nearby St Leonards, further strengthening its presence across the Lower North Shore.

Beyond that, Aqualand remains behind the final stage of Barangaroo, where plans will deliver a five-hectare mixed-use precinct comprising new homes, retail, hospitality and community facilities, alongside a new Metro entrance and more than two hectares of public open space, completing the Barangaroo precinct.

Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/central-barangaroo-development-takes-big-step-with-concept-proposal-approval">Central Barangaroo development takes big step with concept proposal approval</a>

Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/first-look-aqualand-joins-st-leonards-apartment-party">First look: Aqualand joins St Leonards apartment party</a> 
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First look: Aqualand pushes ahead with Chatswood apartment tower as SSDA lodged for Archer Street

Mass timber is becoming an increasingly popular construction material in apartment developments, but Adelaide developer <a href="https://www.apartments.com.au/developers/otello">Otello</a> is taking the approach a step further.

At its new <a href="https://www.apartments.com.au/new-apartments/flowe-bowden-18-gibson-street-bowden-sa-5007">Flowe Bowden</a> development, the exposed cross-laminated timber (CLT) structure isn't just about reducing the building's environmental footprint. It also forms the foundation of a broader wellness strategy, influencing everything from indoor air quality and natural materials to the way residents move through and experience the building.

The 115-apartment mixed-use development, designed by Melbourne-based architecture practice Fieldwork, will occupy a prominent island site opposite Bowden Village Reserve, combining one, two and three-bedroom apartments with retail and a dedicated wellness destination.

[smartcode_project:default project_id=152022 project_image_fid=375528]

Wellness isn't confined to a gym or shared resident facility at Flowe. Instead, Fieldwork embedded the concept into the building itself.

The development has been split into two residential wings connected by a naturally ventilated central breezeway, replacing traditional enclosed corridors with open-air walkways that improve natural light, encourage cross ventilation and create more opportunities for neighbourly interaction.

"Rather than treating wellness as something that only happens on the ground floor, our response integrates it throughout the building, which led us to ask what it really means to design a healthy building," Fieldwork Director Quino Holland said.

[smartcode_project:default project_id=152022 project_image_fid=375531]

The building's architecture also reflects Bowden's industrial heritage. The lower podium references the area's historic brick and sandstone buildings, while the upper levels transition to exposed CLT, allowing the timber structure to become a defining feature throughout the apartments and shared spaces.

The use of mass timber sits alongside a range of sustainability initiatives, including a fully electric, gas-free design, rooftop solar and a targeted 5 Star Green Star rating.

[smartcode_project:default project_id=152022 project_image_fid=375524]

Inside the residences, the focus remains on natural, durable materials. Blackbutt engineered timber flooring, exposed CLT ceilings, porcelain surfaces and warm timber joinery create a calming interior palette, while low-VOC finishes and responsibly sourced materials have been selected to improve indoor air quality.

Kitchens have been designed as the centrepiece of each apartment, featuring porcelain island benchtops, timber-look cabinetry and brushed steel tapware, with layouts that maximise natural light and ventilation.

[smartcode_project:default project_id=152022 project_image_fid=375530]

The more traditional interpretation of wellness comes in the form of Level Eleven, a two-storey wellness club spanning the ground floor, mezzanine and first floor.

The facility will include a gym, yoga and reformer Pilates studios, Finnish and infrared saunas, magnesium hot and cold plunge pools, and dedicated recovery spaces. Unlike many residential wellness facilities, Level Eleven will also operate commercially, allowing the broader Bowden community to access the venue while giving residents exclusive membership benefits.

The ground floor has also been designed around everyday living. A café overlooking Bowden Village Reserve will activate the street frontage, while a bike workshop with tool storage, co-working space and dog wash has been incorporated to support daily routines and encourage interaction between residents.

"Flowe brings together my two biggest passions, creating places and creating healthier lives," Otello founder Daniel Harris said.

"We wanted to create something Adelaide hasn't seen before, a genuinely healthy building, where the way you live is lifted without even trying."

Flowe is positioned directly opposite Bowden Village Reserve and within walking distance of Bowden Railway Station and the Adelaide Entertainment Centre, placing future residents just minutes from the Adelaide CBD while remaining connected to one of the city's most established urban renewal precincts.

[smartcode_project_cta:default project_id=152022]

Otello launches wellness-focused Flowe Bowden with Adelaide-first mass timber apartment design

Not all apartment amenities are immediately visible.

Swimming pools, gyms, rooftop terraces and residents' lounges have long featured on buyers' wishlists, but as the way Australians live has changed, so too have the features that make apartment living more convenient.

Increasingly, buyers are placing value on the practical aspects of day-to-day life. Fast internet, EV charging, secure bike storage, flexible workspaces and parcel management are becoming just as relevant as lifestyle amenities, reflecting changing habits and expectations.

Online shopping has been one of the biggest drivers of that shift.

Australians spent a record $82.6 billion shopping online in 2025, with almost one in every four retail dollars now spent digitally, making parcel deliveries a routine part of everyday life rather than an occasional convenience.

For apartment residents, however, receiving those deliveries isn't always straightforward.

Without someone home to accept a parcel, deliveries can be redirected to a nearby Post Office, left in building foyers or common areas, or require building management to temporarily store packages. As apartment living continues to grow across Australia's cities, parcel management has become an increasingly important consideration for both residents and developers.

Australia Post's Parcel Locker network is one response to that shift.

<iframe allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" allowfullscreen="" frameborder="0" height="315" referrerpolicy="strict-origin-when-cross-origin" src="https://www.youtube.com/embed/KPZ9j5FRdsQ?si=Qztc1dNP3ZvEIUhb" title="YouTube video player" width="560"></iframe>

Rather than relying on home delivery, eligible parcels can be directed to a nominated Parcel Locker, where they're securely stored until collected. Once a parcel arrives, residents receive a notification through the AusPost app or SMS and can retrieve it using a one-time code or QR code at a time that suits them.

The network has expanded to more than 1,500 locations nationwide, with Parcel Lockers positioned at Post Offices, shopping centres, supermarkets, transport hubs and, increasingly, within or alongside residential developments.

That growing presence reflects a broader change in how apartment buildings are being planned.

Developers are increasingly considering the operational side of apartment living alongside traditional lifestyle amenities. Just as secure mailrooms, bicycle storage and EV charging have become more common inclusions, parcel management is emerging as another feature that supports everyday convenience.

It also helps preserve the arrival experience within a building. Carefully designed lobbies and communal spaces can quickly become cluttered when deliveries accumulate, while secure parcel solutions reduce the likelihood of missed deliveries or parcels being left unattended.

For buyers comparing apartments, these everyday details are becoming part of the decision-making process.

Location, floorplans and finishes remain fundamental, but the features that simplify daily life are carrying greater weight than they once did. As online shopping continues to shape consumer behaviour, secure parcel delivery is increasingly becoming another amenity worth looking for.

Parcel delivery is joining the apartment amenity checklist

Inca Property Group has lodged a State Significant Development Application (SSDA) for Dawn, a 53-apartment oceanfront development overlooking Mona Vale Beach.

The proposal, at 35-39 Darley Street East, would replace an existing 18-apartment strata building with a new owner-occupier-focused development comprising 53 two and three-bedroom apartments, including nine affordable built-to-rent residences delivered under the State's infill affordable housing scheme.

Positioned on a 2,679 sqm elevated site around 280 metres from Mona Vale Beach, the development has been designed to maximise panoramic ocean views while responding to the site's sloping topography.

<a href="https://www.apartments.com.au/developers/inca-property-group">Inca Property Group</a> Managing Director Josh Thompson said the State Significant pathway provided greater certainty for projects of this scale.

"This State Significant pathway gives the team real certainty to progress <a href="https://www.apartments.com.au/new-apartments/dawn-35-39-darley-street-east-mona-vale-nsw-2103">Dawn</a> through to completion," Thompson said.

"It allows us to acquire a one-off site, design it carefully and deliver the right offering for the suburb, assessed by the NSW Government's planning department."

The project is one of the first developments in the area to be assessed under the NSW Government's Low and Mid-Rise Housing policy, with the site sitting on the edge of the policy's designated inner area.

The proposal includes three basement levels providing 124 car spaces, alongside a range of resident amenities including a swimming pool, gym, sauna, wellness facilities and private plunge pools for selected ground-floor and penthouse apartments.

<img alt="Dawn" data-entity-type="file" data-entity-uuid="fc1a1daf-0ce4-4f12-9076-b1fa553c7a91" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-21%20at%208.42.11%E2%80%AFAM.png?VersionId=4GZ9h.gpNkTljbxyAET8Jfhv51XUamDm" />

Thompson said Dawn had been designed specifically for owner-occupiers and downsizers, a buyer profile that has driven demand across Inca's recent Upper North Shore developments.

"The majority of buyers in our recent North Shore projects have been downsizers, and we are learning exactly what this market is looking for. Beyond the location itself, we have included resort-style amenities to deliver a genuine lifestyle offering," Thompson said.

Located within walking distance of Mona Vale Beach, the town centre, Mona Vale Golf Club and the Royal Motor Yacht Club, Dawn represents Inca's first Northern Beaches project following the sell-out of Tara on Park in Waitara and Ellis Residences, currently under construction in St Ives.

Construction will be undertaken by Inca's in-house construction arm, GOP Constructions.

Dawn is the latest major apartment proposal for Mona Vale, with the suburb emerging as one of the key beneficiaries of the NSW Government's new Low and Mid-Rise Housing policy.

New developer One Living, led by industry veteran Joseph Scuderi, recently secured a site on Mona Vale Road, on the border of Mona Vale and Pymble, where it is planning around 140 apartments.

IPM is also planning its third project in Mona Vale, significantly increasing the scale of its previous developments with an 82-apartment proposal at <a href="https://www.apartments.com.au/new-apartments/159-167-darley-street-west-mona-vale-nsw-2103">159-167 Darley Street West</a>, opposite Bayview Golf Course and less than 800 metres from Mona Vale town centre.

Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/one-living-enters-sydneys-new-apartment-market-with-northern-beaches-site-acquisition">One Living enters Sydney's new apartment market with Northern Beaches site acquisition</a>

Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/first-look-ipm-plans-third-mona-vale-project">First look: IPM plans third Mona Vale project</a>

Jonathan Chancellor

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