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<img src="https://counter.theconversation.edu.au/content/74545/count.gif?distributor=republish-lightbox-advanced" alt="The Conversation" width="1" height="1">
GUEST OBSERVER
Is “value capture” a wonderful untapped opportunity to fulfil all our infrastructure dreams? Or is it just a new way to sting the taxpayer? Our new report casts a cold, hard gaze over value capture, and finds that it’s a good tax in theory, but will prove very hard to put into practice.
Value capture is the name given to a policy whereby governments capture some of the increased value of land that results from building a new piece of infrastructure. Typically, the money the government “captures” is used to help fund the project.
At first glance, value capture seems marvellously fair, because it applies only to those who benefit from the particular project. So the people of western Sydney do not help fund a new railway station on the North Shore. But look a little closer: it also means that affluent inner-city residents don’t help fund a better railway station in Melbourne’s outer northern suburbs.
Federal ministers from the prime minister down are enthusiastic about value capture and are pushing the states to embrace it. Only last week, Urban Infrastructure Minister Paul Fletcher reiterated that the Commonwealth does not want to be “just an ATM” for the states. But if the federal ministers face up to some home truths, they may find value capture less to their liking.
Value capture is a tax
Home Truth No. 1 is that a value-capture scheme is a tax. That’s how it raises revenue. Politicians tend to shun the “T word”. They prefer to present value capture as an innovative financing mechanism. Sorry, it’s a tax.
Some advocates point to Hong Kong, where a private company builds and operates the rail lines, in return for cheap access to development rights around the new stations – a non-cash subsidy. Yes, integrating new infrastructure with rezoning and other planning changes is a great idea. But a similar model in Australia would have to be much smaller in scale.
That’s because in Hong Kong the government owns all the land. In addition, the city is dramatically denser than Australian cities: more than 7 million people live in a built-up area of around 285 square kilometres, compared with Sydney’s population of about 5 million in around 2,000 square kilometres. In a very dense city, good access to mass transit is highly valued.
Others in the value-capture camp point to tax increment financing (TIF) schemes. These have been used in the US with mixed success.
TIF schemes don’t involve a new tax, or indeed a funding source of any kind. Instead, they are financing schemes that earmark an expected increase in future revenue from existing taxes, such as land taxes, which can be attributed to a new piece of infrastructure. This increase is then used to repay special-purpose bonds.
But TIF schemes are of little value in the Australian context, since Australian governments have strong credit ratings and can borrow at extremely low rates of interest – more cheaply than private sector financiers can. Not only this, but TIF schemes generally do not offload project risk. They may instead come with a hidden government guarantee.
Family home would be captured
Which brings us to Home Truth No. 2: to raise a reasonable amount, a value-capture tax would need to include the family home. Owner-occupied housing accounts for around 65 percent of total land values in Australia, and increases in its value are taxed very lightly (see the chart below).
<a href="https://www.propertyobserver.com.au/images/2017/03/20/image-20170316-20491-1fsjall.png" target="_blank">Click to enlarge</a>
<img src="https://www.urban.com.au/images/2017/03/20/image-20170316-20491-1fsjall.png" alt="">
To minimise the distortions value capture could have on the economy, it should be charged on unimproved land value, as a flat proportion of the land-value uplift attributable to the new infrastructure, with no exemptions.
A tricky question of who’s in and who’s out
Home Truth No. 3 is that many taxpayers are likely to feel aggrieved. Property prices go up – and down – for many reasons.
Drawing a boundary around a new piece of infrastructure to distinguish between those who must pay the new tax and those too far away to benefit is bound to involve rough justice.
Also, it won’t be easy for governments to convince people that their new tax bill still leaves them better off. Homeowners get the benefit of the new project on paper, but have to pay the tax bill in cash. Is this sounding like a political nightmare yet?
A way to reduce the political heat
There is, however, a way to implement value capture that could take a bit of the political heat out of individual decisions. Governments could pass general legislation that applies value capture to every transport infrastructure project with certain characteristics:
an identifiable beneficiary catchment
a project that’s expected to makes an area significantly more accessible
the amount of revenue to be raised far outweighs the cost of administering the scheme. 
So, for example, value capture might apply to all urban passenger rail projects costing over A$50 million. The tax might then be levied on all properties within 800 metres (i.e. walking distance) of a new station.
Once such legislation is in place, each value-capture tax may be slightly less politically fraught. This approach will minimise the opportunities for rent-seeking or corruption that arise from designing bespoke schemes for every individual project.
Broad-based land tax is better still
A better answer still could be a broad-based land tax. Such a tax is highly efficient, because land is an immobile tax base (see the chart below).
<a href="https://www.propertyobserver.com.au/images/2017/03/20/image-20170316-20523-5e9xex.png" target="_blank">Click to enlarge</a>
<img src="https://www.urban.com.au/images/2017/03/20/image-20170316-20523-5e9xex.png" alt="">
While it would not zero in on the beneficiaries of new infrastructure, a land tax would capture the effects of all infrastructure, old and new, as these translated into land values, making it scrupulously fair. A broad-based land tax would also be simpler to administer than a value-capture tax. That’s because there would be no requirement to police the geographic boundary of the catchment area.
So a broad-based land tax has some distinct advantages over a value-capture tax.
Some will say our conclusions are pessimistic, that a little more creativity could devise a way to design value capture so it painlessly funds public infrastructure. To which we would say: there’s no magic pudding when it comes to public money – the only sources of funding for public infrastructure are user charges or a tax. Value capture may involve taxing beneficiaries more than the general taxpayer, but it’s not a bucket of free money.
Yes, if value capture is done the right way, as a tax that embraces the principles of equity, efficiency and simplicity, it could make a positive contribution to infrastructure funding in Australia. But the truth is, there is nothing easy about capturing value.
 
Marion Terrill is<a href="https://theconversation.com/profiles/marion-terrill-169480"> </a>Transport Program Director, Grattan Institute and can be contacted <a href="https://theconversation.com/profiles/marion-terrill-169480" target="_blank">here</a>.
Owain Emslie is<a href="https://theconversation.com/profiles/owain-emslie-250445"> </a>associate, Grattan Institute and can be contacted <a href="https://theconversation.com/profiles/owain-emslie-250445" target="_blank">here</a>.
Both are authors for The Conversation.
 
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jchancellor-FAypfDUnLy

Value capture: a good idea to fund infrastructure but not easy in practice

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House price growth is typically regarded as a good thing. It creates a feel good wealth effect which triggers spending across the economy.
But the recent scenario from the Organisation for Economic Co-operation and Development casts that concept aside.
The Paris-based OECD said in its latest economic report that the single biggest threat to Australia is from rising house prices.
They suggested a recession was possible after a hard landing in the property market following our years of double-digit price gains.
Putting the risk of a recession at around one in five, the report said the residential market may not ease gently but develop into a "rout on prices and demand" especially given that households account for around half of Australia's total debt.
Their warning came a day after gross domestic product data showed the we'd avoided recession in 2016.
It also coincided with CoreLogic calculation that Sydney's price growth had firmed even further through February.
It now sits at an 18.4 percent annualised price growth with the house median a $895,000 and apartments at $685,000. 
The last time there was similiar growth in Sydney was in 2003 when prices jumped 17 per cent in 12 months to $454,000. Soon afterwards the Sydney market had crashed and then an extended price plateau set in.
Even further back was 1989 when Sydney prices jumped 24 percent in the wake of the 1987 stockmarket crash and bicentennial switch into property, that resulted in an horrific crash during our last recession. 
Normally house prices fall because of the impact of rising unemployment or rising interest rates. For the past few years there's been the looming spectre of fallout from an envisaged Chinese downturn, which hasn't eventuated.
But the OECD now suggests house prices could collapse because the ever increasing prices will trigger households into the realisation that they were carrying too much debt. Regulatory retraints will kick in too as a contributing factor.
It will create a downward spiral in economic activity that pushes up unemployment, accelerating mortgage defaults, and creating distressed bank balance sheets, turning what may have been an orderly "correction" in house prices into what the OECD warns could be a "rout".
The OECD did not nominate any timing on the tipping point.
And OECD has been at the misinformed bearish end of the forecasting spectrum for many years.
Despite the headlines that always come after their reports, the mum and dad home buyers and investors have stopped listening.
Driven instead by the fear of missing out or being on the sidelines given continuing price gains in Sydney.
The OECD's report does echo the Reserve Bank's recent unease over household indebtedness, which the new governor Philip Lowe considers could backfire into a spending slowdown.
But we aren't seeing any impact at Saturday property auctions. They've sat at 80 percent or higher for the past month.
This article was first published in the Daily Telegraph. 
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Can too much house price growth hurt the economy?

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GUEST OBSERVER
You may have heard that Victoria announced a new tax this month that will cost landlords $20 million a year, and that's just in the beginning.
Many observers believe that investors will be squeezed over time by increasing tax rates that raise the state government's take.
How does this new tax affect you as a property investor? Let's look at it closely.
First, here are the details of the tax:
• It will be charged every calendar year from January 1, 2018, together with your land tax.
• It will be imposed on houses and apartments in the inner and middle suburbs of Melbourne that lie vacant for more than six months per year.
• It will cost you 1 percent of your property’s capital improved value. For example, if the capital improved value is $500,000, you will have to pay $5,000 in tax every year.
• There are exemptions: holiday homes (if your principal place of residence is in Australia), a city unit for work purposes, properties in deceased estates and homes subject to legitimate temporary absences (e.g. medical care, overseas appointments).
• You can avoid this tax by selling, moving into or renting out your vacant Melbourne property.
Is Victoria a safe place to invest?
The biggest question raised by this new tax, which is just the latest strand of red tape strewn across Melbourne’s CBD in recent years, is whether the state is any longer a safe place for property investors to put their money.
Property investment is almost always a years-long commitment to a location. Time can expose you to many unforeseen risks, so the smart investor tries to avoid at least those that seem obvious.
And it does seem obvious that Victoria's leaders will impose more taxes on property investors in the years to come. The Australian Financial Review reckons that the latest move is "just the start of a push by the state to collect more revenue from property owners."
True, most of these fees and taxes have targeted foreign investors, but this latest levy makes no distinction between offshore and local absentee owners. 
Who’s Next?
Pickpockets operating on a crowded street never limit themselves to just one wallet, but pick as many as they can. Just so, governments pursuing new revenue never limit themselves to taxing —as in the case of foreign buyers— just the smallest share of those within their reach. Not when there is a far richer wallet to be picked. Australian property investors: that wallet belongs to you.
What's most puzzling about this behaviour is that property investors have contributed much to Victoria. You have added hundreds of millions of dollars and tens of thousands of jobs to the local economy. By purchasing units off the plan, you have made possible the construction of development projects that otherwise would have remained nothing more than architectural drawings. All this building has provided tens of thousands of new homes for Victorian residents.
Worst of all is the government's shallow claim that housing affordability is its real goal. Victoria’s recent development boom was made possible, in large part, by property investors. The most powerful thing the state government could do for first home buyers would be to encourage the very property investors who make new construction possible.
The new residences that investors create give homes to renters and provide opportunities for new buyers to grasp the property ladder and climb onto the first rung. 
Unfortunately, the state is taking exactly the opposite tack.
Real estate agents can profit
While investors may be dismayed, real estate agents can profit from the new vacant property tax. It represents a golden ticket for real estate agents who, due to their deep local knowledge, may be aware of which residences are vacant. I'm sure smart agents are already calling and emailing owners of vacant property to help them to sell or lease up the homes for them.
Perhaps most puzzling of all is that Victorian Treasurer Tim Pallas says the State plans to use utility usage to determine which homes are left empty. At Bunnings right now you can buy timers that give you precise control of both water and electrical usage in your property. Is the State so naive as to impose a tax that anyone can foil by installing a couple of $20 electronics? Installing a timer on one faucet and another on a single outlet seems likely to ensure an owner’s utility usage falls within the minimum range.
Gavin Norris is head of Australia for Juwai.com, the No. 1 Chinese international property portal and can be contacted <a href="https://list.juwai.com" target="_blank">here</a>.
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What Victoria’s new vacant property tax means to you: Juwai's Gavin Norris 

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<img src="https://counter.theconversation.edu.au/content/74611/count.gif?distributor=republish-lightbox-advanced" alt="The Conversation" width="1" height="1">GUEST OBSERVER
The latest complaints about the National Broadband Network (NBN), including concerns about slow download speeds and frequent dropouts, show that all is not well with the NBN.
A recent report by the Organisation for Economic Co-operation and Development (OECD) also flags Australia’s broadband speeds as among the worst in the OECD, beating only Mexico, Chile and Greece in terms of internet speed and penetration.
This raises questions on NBN’s continued use of fibre to the node (FTTN) over a large proportion of the total NBN footprint.
When the coalition government came to power in 2013, it instructed a new NBN management team to stop rolling out fibre to the premises (FTTP) and instead build a multi-technology-mix (MTM) version of the NBN.
But, as predicted, it is becoming clear that the FTTN component of the network is inadequate for Australia’s future needs.
Who’s to blame?
NBN chief executive Bill Morrow has deflected some of the blame for low speeds away from NBN and onto retailers, suggesting that their networks might not be up to the task.
He has correctly pointed that part of the problem is that many customers are opting for cheaper, slower services rather than the more costly faster ones.
In defence of its network, NBN points out that existing slow-speed ADSL services dominate the speed data quoted in the OECD report. It suggests that rolling out the NBN out across the entire country will help to improve Australia’s broadband ranking.
But this argument ignores any future developments in other OECD countries. There are numerous broadband initiatives in the OECD, and many of these initiatives use FTTP networks, which offer much higher speeds than FTTN.
Faster speeds overseas
Worldwide, the proportion of fixed broadband services using FTTP has increased by 77% in the past year and those using copper, such as FTTN, have decreased by 11.6%.
While the OECD and the rest of the world are moving forward with ramped-up FTTP deployments, Australia is moving backwards with its continuing rollout of FTTN.
New Zealand, for example, currently sits three places ahead of Australia in the OECD report. But in New Zealand, the telco and internet provider Chorus is installing FTTP around the country.
It announced in September last year gigabit-per-second services across its fibre footprint, starting at a wholesale price of NZ$60 (A$55) per month. This follows the announcement of gigabit services in Dunedin in 2015.
In Spain, more than one-third of customers have access to FTTP and this fraction is growing. A similar surge in FTTP connections is taking place in France.
In the United States, fibre rollouts are expanding, and countries such as Sweden and Finland already have a large penetration of fibre in their networks. Many countries in Southeast Asia either have rolled out, or are rolling out, high-speed FTTP networks.
One of the reasons why FTTP deployments are expanding worldwide is that newer construction techniques and cabling technologies are driving down the cost of FTTP.
Enter Fibre to the Curb (FTTC)
NBN Co announced last September that it will roll out Fibre to the Curb (FTTC) to around 700,000 premises originally slated to use an upgraded version of the Optus HFC network.
FTTC is a relatively new technology in which fibres link the local telephone exchange to small existing pits in the street, outside a home or business. FTTC potentially provides speeds in excess of 500 Megabits per second.
Up to the pit, FTTC is essentially the same as a FTTP. The key difference is that in FTTC, a small waterproof electronic box in the pit connects the fibre to the existing copper wires that run into the home.
But FTTC is largely untested in large deployments such as Australia’s NBN. So a rollout of FTTC will carry a degree of technological risk.
NBN says it will cost about A$2,800 to roll out FTTC to each premises, which is only $630 more than FTTN. Like FTTP, the cost of rolling out FTTC will decrease over time using newer construction techniques. FTTC and FTTP are both becoming more cost competitive.
With speeds as much as ten times higher than FTTN, FTTC has the potential to improve Australia’s rankings in broadband speeds and accelerate Australia’s transition into the digital economy. These were the original objectives of the NBN.
In a blog post, NBN’s chief network engineering officer, Peter Ryan, says that FTTC and FTTN are closely related, and uses this premise to paint a picture of how easy it will be to upgrade from FTTN to FTTC.
But FTTC has a natural relationship to FTTP and not to FTTN. In FTTN, fibres feed a cabinet on the side of a road that is connected to nearby 240-volt power lines. The power supplies backup batteries and banks of electronics that connect to the premises via the existing copper wires.
In FTTC (and FTTP, for that matter) the expensive powered node is not needed, meaning that the cabinets in the street could have to be trashed when FTTN is upgraded.
In an attempt to bolster its arguments for FTTN, NBN has asserted that those cabinets are “an extremely valuable asset … which can be used for a range of purposes”. But it is very hard to imagine what these purposes could be.
Taking stock
Despite the excitement over FTTC, it’s getting harder to cancel contracts for FTTN and move to a more sensible strategy.
Ryan points out it’s not possible to “tear up 18 months” of FTTN planning as that would only delay some connections for two to three years.
Rod Tucker is a Laureate Emeritus Professor at the University of Melbourne, in the University of Melbourne’s Department of Electrical and Electronic Engineering and author for The Conversation. He can be contacted <a href="https://theconversation.com/profiles/rod-tucker-2000" target="_blank">here</a>.
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Australians could get faster broadband with more kerbside NBN connections: Rod Tucker

Australian housing market turnover - the RBA's nine chart insights

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BRICKX, the innovative online platform that makes it easy to invest through fractional ownership, has seven properties for potential investment.
To mark its sixth month since launch to small investors, any Bricks brought today - March 16 - will not incur purchase transaction fees.
"This offer ends at midnight tonight (AEDT)," the chief executive, Anthony Millet said.
Investors have potential to receive both capital returns and net rental income. Its tenant for the Bondi property commenced late last year paying $900 per week, as forecasted.
<a href="https://www.brickx.com/" target="_blank">BRICKX</a> has a simple fee structure typically charging a 1.75 percent transaction fee when you buy or sell bricks.
There are no funds under management, performance, contribution, service, or withdrawal fees.
There are monthly expenses associated with each property, detailed on each property's cashflow monthly distributions.
There are some 2,746 BRICKX investors who can currently trade on the exchange.
Some 11,604 Bricks have been transacted in the last 90 days.
The seven properties have an $8,685,000 value.
Since launched in September with four properties on the BRICKX Platform, the venture won Fintech Startup of the Year 2016 at the Startcon awards.
Millet was cited by the Australian Financial Review recently as saying that it took three years to get the approval from the Australian Securities and Investments Commission for the product to ensure it was suitable for retail investors.
The company currently owns properties in Bondi Beach, Double Bay, Enmore, Annandale and Mosman in Sydney and at Port Melbourne and Prahran in Melbourne. 
The estimated net rental yield for these properties, as shown on its website, range from 1.48 percent to 2.88 percent. 
Prices of bricks range from $69 per brick for its one-bedroom property in Enmore to $158 per brick for a two-bedroom house in Melbourne. 
The property investment platform that allows investors to acquire small interests in residential properties buys a property and divides it into 10,000 ‘bricks’, which are then sold to investors. 
The platform has drawn interest from self managed super funds. Chief executive Anthony Millet said SMSFs typically invest six-and-a-half times more than other retail investors through the site.
The average number of properties in which SMSF investors have an interest is 2.7.
For more information, <a href="https://www.brickx.com" target="_blank">click here</a>.
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BRICKX close to securing 2,750 investors as SMSFs take up fractional property investment 

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<img src="https://counter.theconversation.edu.au/content/74233/count.gif?distributor=republish-lightbox-advanced" alt="The Conversation" width="1" height="1">
GUEST OBSERVER
The need for more affordable housing close to public transport and services is acute in Melbourne.
Inner Melbourne has experienced a 74 percent increase in rough sleeping <a href="https://www.theage.com.au/victoria/shocking-record-numbers-of-homeless-people-sleeping-on-melbournes-streets-20160609-gpf1wk">in </a>the past two years. This is perhaps the most visible outcome of the lack of affordable housing options. Only 1 percent of advertised rental properties in the metropolitan area are affordable for households reliant on government assistance.
Buying or renting in the well-serviced inner and middle suburbs is increasingly out of reach for households on low and moderate incomes. A month ago, one of us wrote an article in The Conversation bemoaning the lack of government leadership on this issue. In the 15 months since its election, the Victorian government had not delivered promised revisions to the Plan Melbourne metropolitan strategy or an affordable housing strategy.
What a difference a month makes. It is almost as if some government leaders read the article. Every week (or to be more precise, weekend) since then has delivered a major policy announcement.
Now that Plan Melbourne and Homes For Victorians have been delivered, it is only fair that we provide a preliminary evaluation of how well these strategies meet the housing needs of Victorians on moderate, low and very low incomes.
These documents remain vague about the definition of “affordable housing”. They also do not designate various income groups. We have taken the liberty of defining these groups based on median income brackets.
Moderate-income households
We define moderate income as 80-120% of area median income – about A$68,500-$102,500 a year. In this group, first home buyers appear to be the biggest winners in Plan Melbourne and Homes For Victorians.
The Victorian government will waive stamp duty for first home buyers on homes worth up to $600,000 and taper stamp duty concessions on homes above that price. This is set to cost the government $851 million over four years and save the average buyer $8,000.
However, if previous first home buyer incentives have taught us anything, this is likely to inflate the cost of cheaper dwellings without delivering affordability benefits.
The government is also offering a shared equity program. This allows first home buyers to co-purchase their home with the government. The initiative is intended to support households that qualify for a bank loan but need help saving a deposit. Western Australia has a similar program, which has helped more than 1,500 households buy homes to date.
Low-income households
This group earns 50 percent-80 prcent of area median income, in the range of $42,500-$68,500 a year.
As exciting as the above options are for some first home buyers, they are out of reach for low-income households that earn between $800 and $1,300 per week. These households are unlikely to qualify for social housing but struggle to afford market rent and purchase prices.
This group, which includes many service and trades workers and their families, need a steady stream of new, appropriately sized and affordable market rental options. However, neither the Housing for Victorians nor Plan Melbourne talks specifically about a new scheme to replace the National Rental Affordability Scheme, which the current federal government abandoned in 2013.
It is absolutely true, as the affordable housing strategy states, that federal policies like capital gains tax exemptions and negative gearing favour investors over first-time and other resident homebuyers. However, state government policies can have an impact on scaling up a rental housing market.
In other cities with similar housing affordability crises, such as Vancouver, New York and London, a combination of expedited approvals, development levy abatements, inclusionary zoning and other mechanisms have helped develop new below-market rental units. Located near public transport and services, these are usually provided at particular price points and kept affordable in perpetuity.
Very-low-income households
These households have income of less than 50 percent of the area median, or under $42,500. They are likely to be the primary beneficiaries of significant new social housing funding and development.
The Victorian government has set up a $1 billion fund to support new social housing. The government will work with community housing providers to deliver social housing through new construction and rental subsidies. This is estimated to deliver up to 2,200 new housing units over the next five years.
This funding injection is badly needed: Victoria has the lowest proportion of social housing stock in Australia.
The state government is also increasing funding, or providing new funding, for a Family Violence Housing Blitz, support for transitions out of homelessness, and rooming house renovation.
A new $1 billion loan guarantee fund for social housing providers will be linked to a shared social housing rent registry. This will make life a little easier for the 33,000 households on the public housing waiting list. They currently have to separately register with up to a dozen other community housing providers.
Plan Melbourne has identified a policy direction to use surplus government land to develop social and affordable housing. Launch Housing and VicRoad’s proposal for Ballarat Road in Maribyrnong offer an example of how these partnerships might work. Plan Melbourne also focuses on increasing the supply of social housing through regeneration and intensification of existing public housing sites.
However, the strategy does not recommend a level of social housing as a proportion of total existing and new housing stock. To provide for all households now eligible for social housing, Victoria would require 76,000 more social housing units. By 2051, that figure is projected to increase to 140,000
Furthermore, Plan Melbourne projects a need for 1.6 million new homes in the next 30 years. That’s over 50,000 new homes a year. Of these, 5,000 would be required to meet the needs of low-income seniors, people with intellectual and physical disabilities, female-headed households escaping family violence, and others who simply cannot compete in the private rental market.
Now to make these plans work
 
 
The Andrews government has new housing and planning strategies, but has more to do to ensure they work. Tracey Nearmy/AAP
Plan Melbourne and Homes For Victorians provide several directions that could benefit all Victorians. Welcome aspects include greater emphasis on public transport networks, greater diversity of housing options, 20-minute neighbourhoods and practical mechanisms to get more housing closer to public transport and services.
The plans also make very encouraging noises about strengthening the role of planning in helping to deliver social and affordable housing. This includes overcoming the legislative and definitional barriers to the effectiveness of mechanisms like density bonuses or inclusionary housing.
The continuing lack of formal definition of affordable housing is a fundamental flaw in Victorian affordable housing policy that remains unsolved by Homes For Victorians and Plan Melbourne.
Plan Melbourne and Homes for Victorians together provide some welcome directions towards more well-located and affordable housing. But the previous Victorian planning strategy, Melbourne 2030, foundered in implementation.
Victoria will have to link infrastructure improvements to specific affordable housing targets in well-serviced areas. And the government should continue its work on value capture and development contributions to nail down implementation of its long-awaited affordable housing strategy.
Katrina Raynor is postdoctoral research fellow, Transforming Housing Project, University of Melbourne and can be contacted <a href="https://theconversation.com/profiles/katrina-raynor-255374" target="_blank">here</a>.
Carolyn Whitzman is professor of Urban Planning, University of Melbourne and can be contacted <a href="https://theconversation.com/profiles/carolyn-whitzman-9944" target="_blank">here</a>.
Both are authors for The Conversation.
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What a difference a month makes, but Victoria can still do more to get housing and planning right

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GUEST OBSERVER
If a heatwave hit Melbourne and the power blacked out, most apartment buildings would bake, with indoor temperatures exceeding international health standards, according to a new <a href="https://www.thrive-research.com.au/wp-content/uploads/2017/02/Living-Well-Report-Final-for-issue-080317.pdf">a</a>nalysis that calls for Australia to adopt standards to protect occupants against heat stress.
Researchers at the University of Melbourne modelled six common apartment designs in the city and all six failed standards for new buildings set in France, the UK, Germany and the US. There are no health standards to ensure against heat stress in the Building Code of Australia.
Lead researcher and construction scientist Mr Chris Jensen, from the Melbourne School of Design, said the results are a wake-up call given the risk of heatwaves. He says it’s time Australia catches up with other countries to adopt similar standards for new buildings, and he says action is needed to encourage the retrofitting of existing buildings.
He suggests that just as all buildings have energy ratings, the government could introduce “summer comfort” ratings on apartments to reduce heat stress for occupants and incentivise owners to upgrade their buildings.
“The research highlights to the public that heat stress inside apartments is a real issue and that we need to do more to control for this, not only in new buildings, but also for existing buildings,” said Mr Jensen. 
“It isn’t a new problem, but climate change science expects more frequent and possibly longer heatwaves, so the health risk is only going to increase.
“What we need to be concerned about are existing apartment buildings that lack air conditioning and are susceptible to overheating, but we also need to be concerned about most buildings should a heat wave coincide with a power black out which would eliminate all air-conditioning.”
Such an “event” is far from fanciful given the blackouts that hit South Australia in February 2017 and warnings of possible load shedding in Sydney during the recent NSW heatwave.
France introduced “summer comfort” standards after the 2003 heatwave there estimated to have caused over 14,800 deaths, with the elderly particularly vulnerable. The French standards require that without the use of air conditioning, building design should ensure that temperatures inside rooms don’t exceed 28 degrees for more than 3 per cent of the year - equivalent to 260 hours.
The researchers modelled how six common Melbourne apartment designs could cope with excessively high temperatures by testing them against the heatwave conditions that hit Melbourne in January and February 2009, which included the Black Saturday bushfire disaster of 7 February. That heatwave included three straight days when the temperature topped 43 degrees, while nighttime lows exceeded 25 degrees. 
They also chose a worst-case scenario by modelling west-facing apartments that are most exposed to the sun. All six sample apartments failed the four international standards they were tested against.
“We modelled both old and new apartment designs, including an example of a recent and best practice design, so it is fair to say that most other west-facing apartments in Melbourne would fail these international standards under these conditions, and quite possibly those in other orientations,” Mr Jensen says.
Some common reasons why the apartment designs failed included:
<ul class="ul1">
<li class="li9">Single glazed windows with poorly insulated frames</li>
<li class="li9">Lack of insulation generally</li>
<li class="li9">Poor natural ventilation</li>
<li class="li9">Aged weather stripping that provided only moderate draft protection</li>
</ul>
Mr Jensen says it is possible that under a standard tailored to the Australian climate more buildings would pass, since it could reflect the fact that locals are more accustomed to hotter conditions. But he warns it is still likely many existing apartments wouldn’t meet a new standard. He says current building standards governing energy use only indirectly address “summer comfort” since they aim to reduce cooling energy requirements. He says more explicit heat stress standards, which measure a building differently, are needed to ensure designs directly took account of the health risks.
“As a priority we need to introduce into the building code our own ‘summer comfort’ standards that are tailored to our own climate, and simultaneously efforts to retrofit buildings to reduce over heating need to be prioritised on high risk cases.” He said such high risk cases include west facing apartments with lots of glass and buildings where vulnerable people such as the elderly may be housed.
He says introducing standards for new buildings would be relatively easy and wouldn’t impose significantly higher costs on building design and construction. The big problem, he says, will be in funding the retrofitting of existing buildings. He says owners and governments would likely be reluctant to meet the cost of widespread retrofitting.
A more effective short-term solution might include an apartment heat stress rating system, to alert potential buyers and occupants about the comfort of the apartment.
“This would strategically drive the market to improve performance,” says Mr Jensen.
“It is unlikely many building owners will be prepared to invest perhaps millions of dollars in retrofitting unless they feel they have to. But a comfort rating would change the equation because occupants will be able to compare the rating on buildings, giving owners an incentive to ensure their buildings are attractive.”
Beyond standards and designs, Mr Jensen says there needs to be greater awareness among occupants of what they can do in heatwave conditions to keep themselves comfortable. He says educating occupants to open windows and balcony doors is an effective way of allowing buildings to cool naturally, at no cost. He also suggests that people close off a room during a heatwave to keep it relatively cooler as a place to retreat to. People can also make decisions to leave their apartments and spend time at air-conditioned locations such as shopping centres and cinemas.
“Just as the government has a bushfire advisory program, it would also be a simple strategy to provide advice for what to do during heat waves,” he says.
To improve existing buildings, the study found the easiest and most effective strategies for apartments include:
<ul class="ul1">
<li class="li9">improving ventilation, both in the fabric of the apartment and operated by occupants (like opening a window)</li>
<li class="li9">using external heat-reflective coating and paint</li>
<li class="li9">installing appropriate shading.</li>
</ul>
Andrew Trounson, is senior journalist, Pursuit, University of Melbourne and can be contacted <a href="https://pursuit.unimelb.edu.au/articles/contact-the-pursuit-team" target="_blank">here</a>.
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Why Melbourne apartments are failing the heat stress test

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<img src="https://counter.theconversation.edu.au/content/73842/count.gif?distributor=republish-lightbox-advanced" alt="The Conversation" width="1" height="1">
GUEST OBSERVER
The “bank of mum and dad” is helping young Australians with more than just their housing aspirations.
New analysis of data on children receiving an inheritance or cash payment from their parents has found they are more likely to be involved in business startups, financial risk-taking and entrepreneurial ventures, and receive other benefits to those without wealthy parents.
The bank of mum and dad is an expression coined to describe parents generously helping their children to get onto the home ownership ladder. We already know that parental transfers are helping Gen X and Gen Y children break into home ownership, in a market considered unaffordable by international standards.
While some are angered by the growing intergenerational wealth divide between the millennials and their baby boomer parents, estimates from the Household, Income and Labour Dynamics in Australia (HILDA) survey show many young people are benefiting from the wealth of their parents.
Between 2002 and 2012, 1.8 million Australians received an inheritance on one or more occasions. There was an average transfer of A$95,000 per beneficiary over the period. An even higher number (5.8 million) received cash transfers from surviving parents. These gifts averaged A$9,000 per recipient.
Housing assets remain the most important component of households’ wealth portfolios. The majority of households will therefore directly or indirectly draw down on housing wealth to finance monetary gifts to others while they are still alive. The family home is also typically the largest asset bequeathed when parents pass on.
Moreover, booming real house prices have boosted inheritances. At the same time, flexible mortgages have enabled parents to dip into their housing wealth to finance cash gifts to their children.
More than a leg up the housing ladder
A recent Australian Housing and Urban Research Institute report has shed new light on how financial gifts from parents help shape young people’s economic opportunities.
The study matches every person benefiting from an inheritance or parental cash transfer to a “control” person who is not a beneficiary, but has otherwise similar personal characteristics.
We found that the bank of mum and dad is helping young Australians with more than just their housing.
Intergenerational transfer beneficiaries are more likely to hold a bachelor’s degree than non-beneficiaries. Among those who receive cash payments from their parents, 29% hold a bachelor’s degree compared to 21% of the control group who do not receive such transfers. Bequest recipients have double the average bank deposit account balance of the matched controls. These larger financial holdings can be used to buffer income shocks, and as collateral to relax borrowing constraints.
Beneficiaries might therefore be willing to take more risks. They are also better positioned to borrow and finance business startups that might not otherwise get off the ground. These ideas are supported by the data.
A higher percentage of those enjoying access to the bank of mum and dad have set up their own business. 22% of heirs to a bequest are self-employed. In comparison, only 16% of the matched controls were self-employed. Similarly, 17% of those receiving cash payments from their parents are self-employed, compared to 11% of the matched controls.
The findings suggest that the bank of mum and dad could play a role in lifting economic growth through multiple channels. These include business startups, financial risk-taking and entrepreneurial ventures.
Bridging an intergenerational divide or widening an intra-generational gap?
It seems the bank of mum and dad is recycling large amounts of housing wealth to the next generation through intergenerational transfers; and it is an increasingly important pillar supporting educational, housing and business opportunities. However, this is a “leg up” that only benefits those fortunate enough to have parents that are able and willing to transfer wealth.
The business opportunities, educational gains and home ownership status that these transfers promote will create a growing divide among younger Australians. Those whose parents own a home are able to take advantage of a wider set of opportunities than others.
As the home ownership dream fades for growing numbers of Australians, this divide will become more conspicuous. Life time renting is a prospect that many Gen X and Gen Y parents are having to contemplate. Unless Australian governments reverse the decline in home ownership, their children will in turn be bypassed by the intergenerational circulation of housing wealth.
These concerns should provide added impetus as governments strive to improve housing affordability, and restore the home ownership society older Australians take for granted. If our governments fail in this regard we could very well witness further entrenchment of inequality in decades to come.
<a href="https://theconversation.com/profiles/rachel-ong-113482" target="_blank">Rachel Ong</a> is Deputy Director, Bankwest Curtin Economics Centre, Curtin University.
<a href="https://theconversation.com/profiles/gavin-wood-113723" target="_blank">Gavin Wood </a>is Professor of Housing, RMIT University.
<a href="https://theconversation.com/profiles/melek-cigdem-bayram-181846" target="_blank">Melek Cigdem-Bayram </a>is Research Fellow, RMIT University.
All are authors for The Conversation.
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Not everyone wins from the bank of mum and dad

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SPONSORED POST
It’s the start of a new year and many businesses may be looking to move office.
Moving an office is a huge challenge that can make moving house feel like a walk in the park – so we’ve collated our top tips for moving offices to make sure the process is as smooth as possible.
Before the move (planning)
<ol>
<li>With the floor plan for your new location, work out at which desk each person will sit.</li>
<li>Assign each desk a number. It’s easiest to sequentially number the desks.  Also alter the number pattern per department. For example, if all your Marketing people sit in one area, assign their desks numbers 100 to 150, your IT Team 200 to 220, Customer Service 300 to 340, and so on. It makes items and areas more easily identifiable.</li>
<li>People with individual offices should have a number assigned to the office.</li>
<li>Match your numbered floor plan with the staff members who will be assigned that desk/office.</li>
<li>Name communal spaces, up to you if you use names or numbers, just make sure they are clear.</li>
<li>Work with IT to ensure all data and power needs are ready (or will be ready) for moving day.</li>
<li>Confirm that you have all details to access the building and that there will be parking available for removalists.</li>
</ol>
Before the move (communications)
<ol>
<li>To the removalists – send them copies of your numbered floor plan so that they have an understanding of the layout ahead of time.</li>
<li>To staff – send clear instructions about the process of packing, along with a cut-off time to have their packing finished. Make sure they understand that any items that are not packed properly will be left behind and then disposed of.</li>
<li>To staff – send a map of the new location so they understand how to get there, where to park, what public transport is available, etc.</li>
</ol>
Before the move (packing)
<ol>
<li>Give each staff member his or her allocated desk number.</li>
<li>Tell staff members to number all boxes, computer screens, hard drives and furniture. Ideally, each item type should be labelled in the same spot (base of the computer screen, top of hard drive, etc).</li>
<li>Filing cabinets should be emptied and locked or taped closed for easy removal.</li>
<li>All keyboards, cables, phones etc should be placed in plastic bags and labelled with their allocated number.</li>
<li>Laptops, tablets and mobiles and any other valuable/personal items should be taken home rather than packed.</li>
<li>Items for shared areas such as kitchens or utilities rooms should be labelled in the same way they are on your floor plan.</li>
</ol>
Before the move (at your new location)
<ol>
<li>Post signs for the removalists with directions to each area. For example, ‘For Numbers 300-500, turn right’.</li>
<li>If you are moving desks into the space, use masking tape, or similar, to plot out where the desks should go. Label each space with its number. Obviously, make sure you’ve measured up ahead of time to make sure everything will fit.</li>
<li>If the office is already fitted out then label the desks with their location number.</li>
</ol>
During the move
<ol>
<li>Depending on the size of the move you may need to arrange to have company representatives at both locations; if there’s more than one truck working, someone needs to be at the new location to meet the first one that arrives while someone stays at the old location until the last of the trucks have completed their work.</li>
<li>Try to have the removalists work on one area at a time, especially in a bigger building. It will ensure you can be there to provide instructions and answer questions.</li>
<li>Wait until everything has been moved in before trying to connect phones and computers. This usually means waiting until the day after the move. You should aim to have all computers connected before staff return to work again.</li>
<li>Before staff return, do a quick check to see that the boxes and items on peoples’ desks correspond with their allocated number.</li>
<li>A nice touch is to create personalized desk labels for each staff member with their name, photo, job title and company logo and leave them on their new desks. It’s a nice surprise for staff and much more welcoming than the location numbers.</li>
</ol>
Before staff arrive
<ol>
<li>Check the building is safe for people to enter, that any rubbish has been removed and walkways are clear.</li>
<li>If the building is big, put up signage with directions for each team to find their way around.</li>
<li>Spot-check all facilities – make sure power, toilets, fridges etc are working.</li>
</ol>
For the latest commercial property news, inspiration and insights, please visit <a href="https://www.realcommercial.com.au/" target="_blank">www.realcommercial.com.au</a>
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Smooth moves: An office relocation checklist

A mix of Gold Coast locals, fly-in, fly-out purchasers from Sydney and Melbourne, and Brisbane-based families has driven early sales success at Broadbeach's newest apartment tower, Lumara.

The 26-level project, a joint venture between builder-developer 5Point Projects and Bourke Projects, comprises just 37 luxury residences and is attracting a buyer profile that is looking for exclusivity, above the most amenity-rich suburb on the Gold Coast.

[smartcode_project:default project_id=150454 project_image_fid=364156]

Jamie Bourke, Director of Bourke Projects, says every buyer secured so far intends to use Lumara as a lock-up-and-leave residence, combining holiday use with the ability to work remotely when required.

“The size of the apartments, both half- and full-floor options, and the different zones within the floorplans, lends itself perfectly to dedicated home office setups and multi-generational family holidays,” Bourke says.

That flexibility has become a key drawcard for affluent buyers seeking a second residence on the Gold Coast without sacrificing the ability to conduct business away from their primary home base.

The absence of holiday letting within the building has also resonated strongly with purchasers.

“This type of buyer doesn't need to generate holiday rental income,” Bourke says. “They're paying for exclusivity, privacy and certainty around who their neighbours are.”

[smartcode_project:default project_id=150454 project_image_fid=366491]

The strong demand comes amid broader shifts in the high-end apartment market following the Federal Budget announcements in May.

“We were already seeing strong enquiry from high-net-worth buyers, but that has only accelerated since the policy changes,” Bourke says.

“A lot of those buyers are looking to place more capital into premium lifestyle assets rather than investment-grade stock that has been targeted by the Federal Government.”

[smartcode_project:default project_id=150454 project_image_fid=366486]

Designed by Cottee Parker, Lumara adopts a slender, sculpted form with an emphasis on natural materials suited to its beachfront setting. The architectural approach draws on coastal influences, with a palette of stone, timber and concrete selected for durability and the ability to weather over time.

Apartments are limited to three and four-bedroom configurations, with a maximum of two residences per floor through the mid-levels and a selection of full-floor and dual-level homes in the upper levels. All apartments are oriented to the north to maximise natural light, cross-ventilation and views across the ocean, city skyline and hinterland.

A two-level amenity offering is positioned high within the building on levels 20 and 21, conceived as a sky wellness retreat. Facilities include a magnesium pool, spa, sauna and steam rooms, alongside more social spaces such as a private dining room, resident lounge, workspaces and outdoor barbecue areas integrated with landscaped greenery.

The uppermost levels are reserved for larger-format residences, including several full-floor homes and a dual-level penthouse with its own private wellness features and recreational spaces.

&nbsp;

To give buyers confidence, 5Point and Bourke commenced construction ahead of the apartments launching to the market, a sure-fire way to prove they mean business, and the building will be delivered. They are targeting a 2028 completion date.

[smartcode_project_cta:default project_id=150454]

Joel Robinson

Locals, interstate holiday makers, drive early sales at Lumara, Broadbeach's newest luxury apartment tower

Often when it comes to purchasing property, the biggest barrier to entry is the deposit. Buyers of established homes typically aim for a 20 per cent deposit to avoid the added cost of Lenders Mortgage Insurance, while most property transactions require around a 10 per cent deposit when contracts are exchanged.

The off-the-plan market works differently, with buyers typically paying a deposit during construction and settling the balance upon completion. As completion approaches at <a href="https://www.apartments.com.au/new-apartments/fabbrica-fitzroy-369-gore-street-fitzroy-vic-3065">Fabbrica Fitzroy</a>, developer <a href="https://www.apartments.com.au/developers/pace-development-group">Pace</a> is making it easier for buyers to secure a residence through a deposit-matching incentive. Purchasers need only contribute a five per cent deposit*, with Pace matching the remaining five per cent.

The offer comes as Pace unveils a completed display apartment and townhouse, now available for inspection by appointment ahead of the project's Spring completion.

[smartcode_project:default project_id=139552 project_image_fid=371009]

Designed by <a href="https://www.apartments.com.au/architects/sjb-architects">SJB</a> with interiors by <a href="https://www.apartments.com.au/interior-designers/winwood-mckenzie-architecture">Winwood Mckenzie</a> and landscaping by <a href="https://www.apartments.com.au/landscape-architect/acre">Acre</a>, Fabbrica draws on Fitzroy’s industrial and manufacturing history, incorporating references to the former Argyle Shirt Factory and Life Savers Confectionery Company that once occupied the site.

The development comprises 85 residences, spanning low-maintenance apartments through to larger-format townhouses with private street access and double lock-up garages, a relatively uncommon offering in Fitzroy’s higher-density apartment market.

Pace says the project has been designed to appeal to buyers seeking inner-city convenience without sacrificing space, flexibility, or amenity.

[smartcode_project:default project_id=139552 project_image_fid=371016]

Inside the residences, Winwood Mckenzie has focused on adaptable layouts and integrated detailing, with features including custom joinery, and concealed storage solutions. The material palette leans into warm, tactile finishes intended to complement the building’s industrial architectural language.

Fabbrica’s rooftop amenity is a key part of the project offering. Spanning around 800 sqm, the communal rooftop includes a private dining room, communal kitchen, lounge spaces, work-from-home zones, and outdoor dining areas overlooking the Melbourne CBD skyline.

[smartcode_project:default project_id=139552 project_image_fid=371017]

Landscape architecture studio Acre has introduced a layered rooftop garden designed to soften the urban setting while creating a more communal environment for residents.

The Fitzroy location also positions residents within walking distance of Brunswick Street, Smith Street, parks, cafés, galleries, and public transport, while remaining only minutes from Melbourne’s CBD. The project has an enviable Walk Score of 96.

[smartcode_project:default project_id=139552 project_image_fid=371025]

Pace, which is also delivering the project as builder, has developed more than 100 projects across Melbourne over the past three decades. The vertically integrated approach has become increasingly common among developers seeking greater control over construction delivery amid broader market pressures affecting the apartment sector.

The strikingly contemporary Gore Street development is now around 70 per cent complete, with purchasers expected to move into their new homes in Spring 2026. A limited number of residences remain available under the current deposit match offer.

*Conditions apply in relation to the deposit match offer.

[smartcode_project_cta:default project_id=139552]

Pace offers five per cent deposit match at Fabbrica Fitzroy ahead of Spring completion

Sydney developer Hyecorp's roots on the Lower North Shore stretch back three generations, and that deep understanding of the market continues to shape where and how it develops today.

From high-rise towers to boutique apartment projects, the family-run developer has built its reputation by focusing on a part of Sydney it knows intimately. Founded by Michael Abolakian in the early 1990s, Hyecorp is now led by his sons Stephen, Troy and Patrick.

Stephen Abolakian, joint managing director alongside Troy, has spent more than two decades in the business, overseeing development, planning, finance, marketing and sales.

Abolakian says the developer's disciplined focus on where it chooses to operate has been, and continues to be, one of Hyecorp's greatest strengths.

“We know the buyer profile exceptionally well,” Abolakian says.

“The demographics between places like Willoughby, Chatswood, St Leonards and Roseville are very similar. There are nuances between suburbs and projects, but culturally and from a buyer perspective, there’s a strong overlap.”

That buyer has historically been overwhelmingly owner-occupier driven.

Unlike many Sydney apartment developers that have traditionally relied heavily on investor demand, Hyecorp’s projects have typically attracted downsizers, upsizers, rightsizers and family owner-occupiers seeking long-term homes rather than short-term investments.

“Historically, investors have been a much smaller portion of our demand profile,” Abolakian says.

“We design for owner-occupiers. We don’t design for yield, we design for comfort, amenity, family living and long-term usability.”

That philosophy extends well beyond apartment layouts.

From landscaping and communal gardens to shared amenities and circulation spaces, Hyecorp’s developments are designed around how people actually live, something Abolakian believes has become increasingly important in Sydney’s apartment market.

“There was probably a period where having an approved project in market was enough,” he says.

“There wasn’t as much competition and if you built it, buyers would come. That’s no longer the case.”

“There’s more supply in the pipeline now, particularly with TOD precincts and low and mid-rise reforms opening up opportunities across Sydney. Buyers have more choice, so if you get the product wrong, they’ll simply go elsewhere.”

[smartcode_project:default project_id=110379 project_image_fid=311393]

The shift has forced developers to become more sophisticated in how they approach apartment design, particularly as owner-occupier expectations continue to rise.

For Hyecorp, that means thinking beyond who the buyer is today and designing for who they may become in five or 10 years' time.

“People buying now often aren’t moving in for several years,” Abolakian says.

“You might have a young couple buying today, but by the time they move in they may have children, older children, or changing lifestyle needs. You’ve got to think about how families evolve.”

That thinking also shapes Hyecorp’s approach to amenity, which positions wellness at the forefront.

[smartcode_project:default project_id=149594 project_image_fid=362634]

While resort-style facilities have become increasingly common marketing tools across Sydney apartment developments, Abolakian says the challenge is ensuring amenities are genuinely usable and appropriate for the scale of the project.

“If amenities are done right, they can materially improve the living experience,” he says, adding however that if you&nbsp;overdo it or get it wrong, you can end up with facilities nobody uses that simply create ongoing strata costs.”

That balance is something Hyecorp is aiming to strike with projects like Roseville Avenue, one of the group's upcoming Lower North Shore developments, which Abolakian describes as bringing a resort-style living experience into a metropolitan setting.

“It’s about creating something that feels special without being excessive,” he says.

“Good gardens, quality apartments, thoughtful amenity. Creating that resort feeling in a metro location.”

<img alt="Hyecorp" data-entity-type="file" data-entity-uuid="13c4c0f3-b1b7-44cf-9344-0b3d1d07797a" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-06-02%20at%2012.14.57%E2%80%AFPM.png?VersionId=9OLWjyj2bYkDV35F78WJnyMSPfc2bJ2z" />

The focus on owner-occupier product comes as Sydney’s apartment market continues to navigate a difficult development environment.&nbsp;For Hyecorp, maintaining an in-house operating model across construction, sales, marketing and development management has become increasingly important in navigating that environment.

“We’ve always believed in keeping a lot of the process in-house,” Abolakian says.

“It creates efficiencies, but it also creates quality control. You can make faster decisions and ensure the end product stays aligned with the original vision.”

Despite the challenges, Abolakian believes demand for quality owner-occupier apartments across Sydney remains strong beneath the surface, particularly across established Lower North Shore suburbs where downsizers continue to seek new housing options close to existing communities.

“There are definitely people waiting,” he says.

“Once some of the broader uncertainty settles, whether that’s the global environment or some of the local economic noise, I think the right projects will perform very strongly.”

Hyecorp currently has three residential developments on the market across Sydney’s Lower North Shore.&nbsp;Audrey, St Leonards, positioned opposite Newlands Park, is nearing completion and preparing to welcome its first residents, with the project now almost sold out.

Hyecorp has also recently launched&nbsp;<a href="https://www.apartments.com.au/new-apartments/celine-chatswood-37-archer-street-chatswood-nsw-2067">Celine Chatswood</a>, an architectural tower, while continuing to deliver&nbsp;<a href="https://www.apartments.com.au/new-apartments/juliet-roseville-64-pacific-highway-roseville-nsw-2069">Juliet Roseville</a>, a more boutique scale of development with just 34 apartments.

Why Hyecorp continues to back Sydney's Lower North Shore apartment market

South East Queensland’s apartment market is entering a new phase defined by rising prices, constrained affordability, and mounting pressure on the construction pipeline, according to RPM Group’s latest SEQ Apartments &amp; Townhomes Market Report.

The May 2026 report highlights a widening divide between what buyers can afford and what developers can viably deliver, with detached house prices continuing to push more buyers toward apartments across Brisbane, the Gold Coast, and the Sunshine Coast.

RPM says Brisbane’s median house price has reached around $1.5 million, accelerating the shift toward higher-density housing as buyers are increasingly priced out of the detached market.

[smartcode_project:default project_id=135094 project_image_fid=356540]

Median unit prices rose across all three major SEQ markets in the March quarter. Brisbane City recorded the strongest annual growth, with median unit prices climbing 21 per cent to $862,000, while the Gold Coast reached the highest overall median at $950,000, up 17 per cent year-on-year. The Sunshine Coast followed at $870,000, representing annual growth of nine per cent.

RPM noted the affordability gap between houses and units remains significant, with detached homes commanding premiums of 67 per cent in Brisbane and 68 per cent on the Gold Coast relative to apartments.

The report suggests this price disparity is increasingly consolidating buyer demand within the apartment market, particularly among downsizers and owner-occupiers.

“Demand is real. Supply is moving. But they’re operating on different timelines and the gap between what’s being built and what buyers can afford is the defining tension in this market right now,” RPM Queensland and NSW Managing Directors Peter Neale and Clinton Trezise said in the report.

[smartcode_project:default project_id=150787 project_image_fid=366230]

While approvals and commencements are strengthening, RPM argues the delivery pipeline remains constrained by construction costs, labour shortages, and extended build timelines.

Apartment approvals across Queensland increased 86 per cent over the year to February 2026, reaching 12,682 approvals, the highest level recorded since 2016. Brisbane overtook the Gold Coast as the state’s most active apartment approval market, with nearly 5,000 apartments approved over the past 12 months.

Unit commencements also strengthened considerably, rising 48 per cent year-on-year to 5,453 commencements in the December 2025 quarter, the highest level since 2018.

However, RPM’s research found apartment delivery timeframes have expanded sharply compared to the previous cycle. Projects are now averaging around 30 months from approval to completion, compared to roughly 20 months a decade ago.

[smartcode_project:default project_id=143932 project_image_fid=367515]

The number of units under construction has climbed to approximately 31,530 dwellings, nearing the previous 2016 peak, though projects are remaining in the pipeline for considerably longer.

Construction costs continue to weigh heavily on feasibility. RPM found the average apartment construction cost in Greater Brisbane reached $630,000 per dwelling in 2025, exceeding both Sydney and Melbourne. Coastal Queensland markets, including the Gold Coast and Sunshine Coast, were even higher at an average of $817,418 per apartment due to the prevalence of larger premium product.

The report also points to increasing pressure from Olympic-related infrastructure spending ahead of Brisbane 2032, with labour competition expected to intensify over the next several years.

[smartcode_project:default project_id=150017 project_image_fid=370960]

ANZ Associate Director of Property Daniel Gradwell said the underlying demand drivers across South East Queensland remain strong, supported by interstate migration, downsizers, and population growth.

“The challenge is bringing enough supply to market to meet that demand, and nothing on the horizon makes that straightforward,” Gradwell said.

RPM’s analysis found the affordability challenge is becoming more pronounced in the new apartment market itself, with only three per cent of surveyed new apartments priced below $1 million.

Instead, the market is increasingly concentrated in higher price brackets, with the most common new apartment price band across SEQ sitting between $1.5 million and $1.75 million. Around half of all new apartment stock surveyed is priced below $2 million.

The report suggests developers are not necessarily avoiding lower price points by choice, but because current construction economics make delivering affordable apartments increasingly difficult at scale.

Rental conditions also remain tight across the region. Median rents for one-bedroom apartments rose 12 per cent in Brisbane over the past year to $580 per week, while Gold Coast one-bedroom rents increased nine per cent to $630.

Despite rising rents, RPM noted bond lodgements have generally trended downward over the past five years, indicating more apartments are being absorbed by owner-occupiers rather than retained as investor-held rental stock.

Looking ahead, RPM expects projects targeting the mid-market owner-occupier segment between $1.25 million and $2 million to remain the most viable part of the market, while premium projects in highly constrained coastal or riverfront locations continue to attract demand.

“Construction costs are rewriting the feasibility rulebook across Greater Brisbane, and with little relief in sight, only projects in the right price band, right location, and with presales secured early will make it through,” the report concludes.

SEQ apartment demand outpacing affordable supply as construction timelines stretch: RPM

Camberwell Junction has long been the epicentre of amenity in Melbourne’s Boroondara region.

For nearly a century, it has drawn both locals and visitors, anchored by the Camberwell Sunday Market, which first operated in 1929 and quickly became a fixture of the suburb’s identity. Over time, the Junction evolved into one of Melbourne’s most established retail and lifestyle precincts, now comprising more than 400 stores and over 300 commercial businesses.

Despite that depth of amenity, one thing has remained notably limited: the supply of new apartments.

In a suburb defined by its heritage streetscapes and tightly held residential stock, new development opportunities have been scarce, particularly within the core of the Junction itself. That lack of supply has left a gap in the market for larger, design-led apartments suited to downsizers and owner-occupiers wanting to remain in the area.

Boutique developer Above Zero identified that gap when it secured a prime site on Burke Road, in the heart of Camberwell Junction.

[smartcode_project:default project_id=4896 project_image_fid=368543]

The site has a long planning history. Various proposals have been put forward over more than a decade, many of which were knocked back by the City of Boroondara, with initial applications dating back to 2015. Above Zero acquired the site in 2022 and returned with a revised scheme, refining both the building’s height and its ground-level interface to better align with Council expectations.

That process has culminated in approval for Camberwell House.

The Cera Stribley-designed development will deliver 57 residences on a 1,950 sqm site within the Camberwell Activity Centre, placing it directly within one of Melbourne’s most established retail and transport hubs.

It is expected to be one of the only new apartment developments to launch in the Junction in recent years, reinforcing the rarity of new supply in the precinct. Currently, there are just a handful of projects on the market in Camberwell, underscoring the significance of a development of this scale and positioning.

[smartcode_project:default project_id=4896 project_image_fid=368544]

Camberwell House has been conceived with a clear focus on larger-format apartments. The project will offer a mix of two-, three- and four-bedroom residences, alongside a limited number of penthouses, targeting owner-occupiers seeking scale rather than volume-driven product.

The building’s vertical presence will also set it apart.

Positioned on Burke Road, the development is set to become one of the taller buildings in its immediate context, allowing for elevated outlooks across Melbourne’s CBD skyline and toward the Dandenong Ranges. In a precinct characterised by lower-scale built form, that height provides a point of differentiation, particularly for buyers seeking outlook and natural light.

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Architecture has been led by Cera Stribley, with interiors by GOLDEN and landscape design by Florian Wild. The design approach centres on material consistency and restraint, with residences oriented to maximise light, ventilation and connection to outdoor spaces.

Full-height glazing and generous terraces form a key part of that strategy, allowing apartments to extend beyond their internal footprint and engage with the surrounding environment.

Beyond the private residences, a significant component of the project is its amenity offering.

Above Zero has positioned Camberwell House as a “complete living environment”, incorporating a full floor dedicated to resident facilities. At the centre of that is a wellness zone, including a 12.5-metre lap pool, spa, sauna and treatment spaces, alongside a gym and recovery-focused amenities.

This level of amenity is more commonly associated with inner-city developments, rather than established middle-ring suburbs like Camberwell.

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Additional shared spaces include a private library lounge, dining and entertaining areas, and an indoor golf simulator. A self-contained guest suite has also been incorporated, allowing residents to accommodate visiting family or friends without impacting their primary living space.

The inclusion of these facilities reflects a broader shift in buyer expectations.

As more downsizers look to transition from larger family homes into apartments, there is increasing demand for developments that offer not just a residence, but a lifestyle. That includes access to wellness, social and entertaining spaces within the building itself, reducing the reliance on external amenity while still maintaining proximity to established precincts.

Camberwell House is positioned to benefit from both.

Its location places it within immediate walking distance of Camberwell Junction’s retail and dining offering, as well as public transport connections, including tram and train services. That combination of internal amenity and external convenience is central to its appeal.

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Jellis Craig Projects Director Stephen Bowtell is handling sales for the project and says Camberwell House offers a rare entry point into one of Melbourne’s most tightly held markets.

“Buyers are recognising that Camberwell House offers something they simply haven’t seen before in Boroondara,”&nbsp;Bowtell&nbsp;says.

“It combines a level of resident amenity and service typically associated with Melbourne’s premium inner-city developments, while being positioned right in the heart of Camberwell Junction.

“The response to the concierge offering has been particularly strong. Buyers appreciate not only the convenience, but also the sense of security and peace of mind that comes from having a dedicated presence in the building every day.

“When you combine that with the wellness facilities, the exceptional arrival experience, and panoramic views across both the CBD skyline and the Dandenong Ranges, it creates a lifestyle proposition that is genuinely unique within the local market.”
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Jonathan Chancellor

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