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The cash rate could fall as low as 1.5% because other sectors of the economy won’t pick up the slack from the declining mining sector, says former Reserve Bank board member professor Bob Gregory.
Gregory’s dark prediction is at the far end of the spectrum, the very far end in fact.
Bank economists reacting to today’s monetary policy statement put out by the Reserve Bank says it maintains an easing bias, but are circumspect on whether the cash rate will be cut much beyond one or two more times.
The Reserve Bank downgraded its economic forecasts today from a range of 2.25% - 3.25% to 2% - 3% with concerns about the pick-up in non-mining investment given the high Australian dollar and the labour market, though it did note a recover in dwelling investment and the housing market on the back of previous rate cuts.
Speaking at a recent economic conference, Gregory said interest rates could fall as low as 1.5% because the RBA will try to stimulate the economy to compensate for the end of the resources investment boom and a substantial decline in the prices of raw materials.
“Interest rates will fall. But I don’t think it’s going to work that much,” said Professor Gregory in comments reported on Wednesday by the Australian Financial Review.
Gregory’s conviction of a massive drop in the cash rate will be duly noted by many: aside from his former role as RBA board member from 1985 to 1990, he was also the first to diagnose the phenomenon of Dutch disease, where a mining boom drives up exchange rates and hurts the rest of the economy.
Along with the mining investment slide, Gregory predicts that real income in Australia could fall by 15% in the next few years with resulting lower living standards.
Commenting on the monetary policy statement, Westpac chief economist Bill Evans says the bank is encouraged that RBA governor Glenn Stevens “pointed out that there was scope to further cut rates should demand conditions require it”.
Evans points out that Stevens uses the word “scope” and “for the time being” in his comments on the cash rate.
“It is our experience that the use of [these terms] both indicate that the bank remains quite open to further easing policy.
Evans expects one further rate cut in the current easing cycle to take the cash rate to 2.75%.
ANZ’s head of Australian economics and property research, Ivan Colhoun, says the risks section of the report “details concerns the bank has about each of residential construction, mining investment, non-mining investment and public spending.
“These risks and the forecast for growth at or below trend over the next two years with low inflation suggests a strong bias to ease (as does the use of the term policy remained appropriate for the time being)”.
But, Colhoun says the RBA is still “clearly in assessment phase and will watch incoming data to decide whether the economy needs more stimulus.
“The continuing slow growth of employment and forecast rise in unemployment suggests clearly to us that the economy could afford to grow more quickly than at the present time and further gradual easing should be expected over 2013,” he says.
ANZ has moderated its forecast of a cash rate of 2% by year-end, but says there could be up to two rate cuts.
CommSec senior economist Savanth Sebastian says the RBA is "clearly in wait and see mode" after providing the domestic economy with 1.25 percentage point worth of rate cuts in a nine month period. “Overall, the average interest rate on outstanding housing loans is now about 25 basis points above its 2009 low” … “The cumulative reduction in interest rates is affecting interest-sensitive parts of the economy, though the full effects will, of course, take more time to become apparent”.
Responding to the monetary policy statement, Sebastian says that while the Reserve Bank may have downgraded growth forecasts over the next year, “the accompanying commentary certainly suggests that board members are more comfortable than even just three months ago”.
“The risks to the ‘global economy appear to be more balanced’ while domestically the ‘significant monetary stimulus already in place, and signs of lower interest rates are having some of the expected effects’.
“In addition the Reserve Bank was at pains to point out that the average interest rate on outstanding housing loans is only ‘25 basis points above its 2009 low’,” he says.
CommSec expects the RBA to leave the cash rate on hold over the next couple of months though it “remains watchful”.
“There are few signs that the RBA is preparing to cut rates again in the short term, but arguably there are more events likely to result in lower rates than higher rates in the period ahead,” says Sebastian.
Commonwealth Bank economist John Peters says the monetary policy statement confirms the RBA’s “clear easing bias”.
“The financial markets have another two rate cuts priced in over the next few quarters, with the first next month.
“The capex data later this month is likely to confirm the RBA’s view that mining investment looks set to peak late this year.
“It may be sufficient to convince them, along with a benign fourth quarter (of 2012) wages report, that more insurance, via another rate cut, is required,” he says
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Gloomy former RBA board member Bob Gregory predicts cash rate to fall to 1.5% but other bank economists more circumspect

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ANZ has announced that variable interest rates for Australian retail mortgages will remain unchanged after its February interest rate review.
ANZ’s standard variable mortgage rate remains at 6.40% per annum (6.50% p.a. comparison rate).
Variable interest rates for small business lending also remain unchanged.
ANZ conducts its own review of interest rate setting on the second Friday of every month.
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ANZ leaves variable mortgage rates unchanged at independent review

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The housing market is responding to cash rate cuts which began in November 20011 says the RBA in its February statement on monetary policy released today.
While warning that near-term prospects for business investment outside the mining sector continue to be subdued, the RBA said there are “signs that the housing market is responding to the series of interest rate cuts over the past 15 months”.
“Since the middle of 2012, residential building approvals have increased, rental yields have moved higher and prices in the established housing market have picked up,” added the RBA.
The RBA notes other positive developments in the housing market.
“Overall, improving conditions in the housing market are expected to continue to provide support to dwelling investment, while non-mining business investment is forecast to pick up gradually over time.”
And it provides commentary on the improvement in capital city house and unit prices.
“Australian capital city dwelling prices have risen by 4% since their trough in mid-2012.
“Recent price rises have been relatively broad based, with all state capitals recording higher prices over the three months to January.
“Some other indicators also point to a strengthening in the established housing market. Auction clearance rates in Sydney and Melbourne have continued to rise from their lows in late 2011 and early 2012.
“Private sector surveys indicate that, on balance, households expect house prices to rise further over the year ahead. Housing loan approvals increased moderately over the second half of 2012, underpinned by loans to investors and repeat buyers, although they were little changed relative to the outstanding stock of housing credit," says the RBA.
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Housing market is responding to rate cuts with many other positive signs: RBA

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Mortgage insurer Genworth has reported both a drop in the number of lenders mortgage insurance (LMI) claims paid out and the average size of claims in its latest quarterly update.
Genworth paid 878 claims over the December 2012 quarter, compared with 963 in the September quarter – a decline of 9.6%.
The average value of claims declined from $84,000 to $81,000.
Across Australia, the overall delinquency rate on LMI mortgages improved by 6 basis points to 0.41% quarter-on-quarter.
Lenders Mortgage Insurance (LMI) is generally required for borrowers that don’t have a 20% deposit and insures the lender against any shortfall if the borrower defaults on their home loan and the lender is required to sell the property as mortgagee in possession.
<img alt="genworthfeb11" height="598" width="470" src="/images/stories/2013/02/genworthfeb11.gif">
The highest number of claims by region were for loans over properties in the tourism-dependent and struggling Coastal Queensland market, with 112 claims paid, but this was down from 113 and 128 in the two previous quarters.
Claims for loans to small businesses and self-employed borrowers declined from 116 to 103 over the quarter.
Globally, Genworth reported a strong rise in net income from US$34 million to US$166 million with earnings per share of 34 cents..
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Size and number of mortgage insurance claims fall in December quarter: Genworth

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Self-funded retirees who invested their savings in failed debenture issuer and mortgage lender Wickham securities should expect to be reimbursed at best around a quarter of their capital.
Investors in Wickham Securities $1 notes are owed around $30 million.
Based on the information currently available, Grant Sparks, joint liquidator from PPB Advisory, says a return of between six cents and 22 cents for every dollar owed should be expected.
Creditors voted this week to place <a target="_blank" href="https://www.propertyobserver.com.au/industry-news/administrators-find-%24108-million-black-hole-in-wickham-securities/2013013059033">Queensland-based Wickham Securities</a> in liquidation.
“We will continue our investigations and seek to realise the loan book,” Sparks tells Property Observer.
Wickham Securities provided 21 loans totalling $28 million at high interest rates to borrowers to fund or refinance commercial property developments.
Of this amount, $5 million was lent to borrowers who are now in liquidation while a further $9.5 million was lent to borrowers where receivers or administrators have been appointed.
PPB Advisory will also examine third party security to see if that can be recovered to pay back investors.
PPB Advisory were also appointed administrators of seven companies related to Wickham, including Sherwin Financial Planners, a business run by Wickham chairman Bradley Sherwin, whose clients included self-funded retirees and some high-net worth individuals advised to invest in the mortgage lender's fund programs.
“We will also continue to provide reports to ASIC,” says Sparks.
Investigations by PPB Advisory found what appears to be a<a target="_blank" href="https://www.propertyobserver.com.au/industry-news/administrators-find-%24108-million-black-hole-in-wickham-securities/2013013059033"> $10.8 million hole in Wickham’s cash flow position</a>.
Sparks says he should next be able to provide a meaningful update to creditors in around eight weeks’ time.
No date has yet been set for an update.
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Wickham Securities creditors to get between 6 and 22 cents back for every dollar: liquidator

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Australia's seasonally adjusted unemployment rate remained steady at 5.4% in January, says the ABS.
This was better than economists’ expectations of a small rise to 5.5%, a result which will be noted by the Reserve Bank as it starts thinking ahead to its March 5 monetary policy meeting.
The economy added a further 10,400 jobs over the month with total employment at 11,549,100.
The increase in employment was driven by increased part-time employment, up 20,200 people to 3,450,700 and was offset by decreased full-time employment, down 9,800 to 8,098,400 people.
The increase in total employment was mainly driven by an increase in female part-time employment. The number of people unemployed increased by 2,000 people to 659,600 in January. The ABS reported a seasonally adjusted labour force participation rate decrease of 0.1 percentage points to 65% in January.
CommSec economist Savanth Sebastian says there is "something for everyone in the latest jobs data". 
"The optimists could focus on the rise in overall employment and conclude all is fine. The pessimists would look at the third consecutive fall in full-time jobs coupled with the fall in hours worked and conclude something more concerning," he says.
"What is clear is the job market isn’t shooting the lights out but by no means is unemployment soaring. In a big picture sense the job market is in a holding pattern with a modest degree of softening.
"Yes, it was encouraging that employment grew but more forward looking indicators like job advertisements have suggested that further labour market gains may be more circumspect. In fact internet and newspaper job advertisements have fallen for 11 consecutive months, suggesting job growth is likely to flat line in coming months," he says.
"In a perverse way the unemployment rate is holding steady because more people gave up the search for work.
"Over the past year the missing ingredient in the domestic economy has been confidence, however there are anecdotal signs that there is an improvement in confidence. Rate cuts, healthy house prices and rising share markets should provide some level of encouragement to policymakers, households and businesses.
"The rate cuts in recent times will help to support activity in coming months and continue to provide businesses with a more breathing space – especially given that trading conditions are difficult," he says.
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Unemployment unchanged at 5.4% in January but full-time employment falls: ABS

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Westpac has announced a two-year fixed rate of 4.99%. The home loan rate is a 40 basis point reduction, and is effective from today.
It's the bank's lowest two-year fixed rate offering since September 2009 and it is currently the only major bank to offer a fixed-rate home loan below 5%, though coming at a time when demand for fixed-rate products is falling.
Westpac will hope customers will consider the lower fixed-rate offering as an alternative to a variable rate mortgage (where mortgage exit fees are banned and customers can refinance relatively easily), locking them in for two-years.
NAB’s lowest fixed-rate home loan rate is 5.34% for its one-year home loan, the Commonwealth Bank offers a one-year fixed rate of 5.19% while ANZ offers a two-year fixed rate at 5.49%.
<a target="_blank" href="/news">A number of smaller lenders </a>offer fixed rate of 4.99% including ME Bank, Resi and Newcastle Permanent.
Non-bank lender Easy Street, owned and operated by Sydney-based Community First Credit Union, is offering a variable rate honeymoon home loan special rate at 4.99%
The Westpac fixed-rate cut follows its <a href="/news">subsidiary bank St. George</a> announced cuts to its fixed rate offerings today.
Another lender, CUA today cuts three-year fixed home loan to 5.30%, which it says is one of the lowest in the current market.
Over January, mortgage broker Mortgage Choice reported that demand for variable rate loans reached a six-month high accounting for 83.65% of the company’s new home loan approvals.
Consequently, demand for fixed rate loans slipped, for the second consecutive month, to 16.35% of newly approved loans.
Mortgage broker AFG also reported a drop in demand for fixed-rate home loans over January.
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Westpac lead the big banks below 5% on fixed home loans

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St George has cut its fixed home loan rates by between 10 and 15 basis points.
For those who take out an advantage package loan, the bank cut its one-year fixed rate to 5.15% per annum, its three-year fixed-rate to 5.29%, four-year fixed rate to 5.64% and five-year fixed rate to 5.69%.
The new rates are available for a limited time for new and existing customers.
Customers with fixed rate applications underway that have not yet settled, are also eligible for these new lower interest rates.

It has also cut its fixed rates for non-package customers with a one-year fixed rate to 5.30% pa, its three-year fixed-rate to 5.44%, four-year fixed rate to 5.79% and five-year fixed rate to 5.84%.
“Fixed loans are a popular option, as they provide customers with the security of having a set loan repayment each month. This is a good way for customers to manage their household finances more effectively and St George’s current fixed rate offer for 1, 3, 4 and 5 years puts us in a leading position against the four major banks,” says Andy Fell, general manager at St George Retail Banking.

In addition, anyone who applies for a St George home loan receives a free Australian Property Monitors (APM) property profile report for the property they are interested in buying and its location.  St George also offers conditional loan pre-approval that is valid for six months, as well as a 5% deposit requirement.
Also announcing a cut today was <a target="_blank" href="https://www.propertyobserver.com.au/news/westpac-lead-the-big-banks-below-5-on-nfixed-home-loans/2013020659208?utm_source=po&amp;utm_medium=aida&amp;utm_campaign=news">Westpac, with its packaged two-year fixed-rate mortgage now at 4.99%.</a> Since the RBA left the cash rate steady on Tuesday several lenders, including most of the major banks, have trimmed up to 40 basis points off certain fixed rate products, says leading mortgage broker Loan Market.
Loan Market corporate spokesperson Paul Smith says the latest shift in fixed interest rates indicates lenders are all anticipating further rate cuts this year.
“We haven’t seen fixed rate this low in several years and the spread between them and variable remains in the unique position where variable are nearly a full per cent higher,” Smith says.

Smith says that although the RBA cash rate is at 3% the chances of it falling more than a full percentage point in the year next were slim, considering the RBA’s conservative response to the soft areas of the economy over the past year.
“Fixed-rate products are currently priced at a level that variable rates may not reach for several months; even with the help of RBA rate cuts."
Smith says all borrowers had varying considerations and that one’s personal circumstances, aversion for risk and financial goals were the key fundamental to bear in mind when looking at fixed interest rates.

“Fixed-rate borrowers should have the mindset to accept that variable rates could fall to a place lower than their fixed rates.”
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St George cuts fixed rates, with three-year fixed at 5.29% 

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Property developer Australand has reported a 5% rise in full-year operating profits to $142.1 million, with strong sales in its residential communities in NSW and a more resilient performance in some of its Melbourne apartment projects due to growth in demand for medium-density housing.

Australand reported 97 sales <a href="https://www.propertyobserver.com.au/developments/australand-s-carlton-development-local-more-than-half-sold-as-first-home-buyer-deadline-draws-nearer/2012062455235" target="_blank">at its Local project</a> in <a href="/news">Carlton </a>in Melbourne (pictured below), with an average price of $500,000, making it the top-selling medium-density project for the year, now 72% sold out. The project is in partnership with <a href="https://www.citta.com.au/pages/projects/living_carlton.php" target="_blank">Citta Property Proup</a>.
{yoogallery src=[images/stories/december13local]}
This was followed by its 333 Burwood apartment project near Camberwell junction, which recorded 93 sales with an average price of $720,000.

Sales of residential land on the outskirts of Melbourne remain “fairly subdued” due to softer trading conditions at the lower end of the market.

<img alt="australandfeb7" src="/images/stories/2013/02/australandfeb7.gif" width="470" height="301"> Overall, the developer is “cautiously optimistic” about 2013 with the resurgence in Sydney “very pleasing”

The top selling land project was Greenhills Beach in Cronulla in Sydney’s Sutherland Shire with 136 sales and an average price of $830,000 per lot.

Australand also reported strong sales at Cockburn Central in Perth (94 sales with average price of $440,000) as well as Kangaroo Point in Brisbane.

There were also strong levels of pre-sales at the NSW projects of Watervue at Wolli Creek (73% pre-sold), Air at Clemton Park (97% pre-sold) along with Melbourne apartment projects Hyde (98%).

At today’s full-year results presentation, anaging director Bob Johnston said it was “interesting times” for Australand given the recent GPT offer for the business and majority shareholder CapitaLand currently conducting a strategic review of its investment.

He said 2012 was a challenging year, but that there had been a “marked” pick-up in the fourth quarter of the year, particurlarly in residential sector.

Johnston noted the 16% rise in residential earnings from $587 million to $606 million driven by a stronger Sydney offsetting a weaker Melbourne market with an increase in margins and higher average sales prices.

This was a strong performance than its commercial property investment portfolio, where earnings rose 8% over the year, but with high occupancies and driven by government or ASX-listed tenants.

He said this portfolio remained in “good shape”.

There were also strong sales across its Greenhills Beach residential community project in <a href="/news">Cronulla</a>, with 136 sales at an average price of $840,000, and Greenvale residential community, 20 kilometres north of Melbourne.

Australand holds 1,169 contracts on hand for the full financial year with 64% expected to settle in 2013.

“While the consumer remains cautious, our residential division delivered strong growth in earnings and is well positioned with contracts on hand up 24% on last year,” says Australand managing director Bob Johnston.

Australand Executive general manager for residential, Rod Fehring reported that there had been 1,788 gross lot sales over 2012, which though down on 2011, had brought with it forward momentum.

Of these 1,788 sales, 1,202 were in the resurging Sydney market with the top 10 projects contributed 84% of residential earnings in 2012.

Fehring says demand is being supported by ongoing interest from offshore investors as well as “excellent presales”.

“Sales activity lifted by 41% in NSW and 33% in WA.

Fehring says Perth benefits from favourable population growth and a very tight rental market resulting in increased overall sales activity.

“Sentiment from mining sector will drive the market, but it is a balanced market. We don’t expect rises in prices, just an improvement in activity.”

Looking at the south-eat Queensland market, Fehring said that at the start of the year things seemed to be improving, with Brisbane holding a median price advantage over the other capital cities.

“But sentiment is weak, and the recent floods may impact further,” he said.

Considering the overall market, Fehring said Australand is “cautiously optimistic about 2013” with lower interest rates, new project commencements that will make substantial contributions and fundamentals in key markets looking “reasonably sound”.

Shareholders will receive distributions of 21.5¢ per share with a similar forecast for 2013 financial year.</body></html>

Australand profits up 5% in 'interesting times', with strong demand for Melbourne apartments 

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The office vacancy rate in the Sydney CBD, Australia’s biggest capital city office market, fell from 8.1% to 7.2% over the six months to January 2013, moving against the national trend of a rising office vacancy rate, according to the latest Property Council’s Australian Office Market Report.
Nationally, Australian office vacancies now stand at 8.4%, up from 7.8% in July 2012, driven by a “dramatic” fall in demand for office space.
Vacancy rates eased in Perth and Brisbane as demand for office space from mining companies and other businesses that service the resources sector “moved down a gear”.
Perth remains the tightest CBD office market, though its vacancy rate eased from 4.2% to 5.7%, with demand for office accommodation in Perth in the last six months the weakest since 2009.
“The Perth office market was affected by cost-cutting in resources companies, particularly the iron ore sector, last year. This resulted in less demand for office space by firms providing professional services to the sector”, says Property Council executive director,Joe Lenzo.
The Melbourne vacancy rate fell 5.6% to 6.9% over the period with and only premium and A grade stock experiencing substantial positive demand.
<a href="https://www.propertyobserver.com.au/office/melbourne-landlords-with-poor-quality-office-space-placed-on-notice-charter-keck-cramer/2013020659190?utm_source=po&amp;utm_medium=aida&amp;utm_campaign=news" target="_blank">Consultants at Charter Keck Cramer</a> anticipate a fall in demand for office space in the Melbourne CBD and Docklands over the next two years, with better quality office space best placed to attract tenants.
In Brisbane, the vacancy rate spiked from 8.0% to 9.1% bringing to an end “a sustained two-year run of strong demand and exceptional take-up levels in the market”.
Click to enlarge
<a title="Click to enlarge" rel="shadowbox" href="/images/stories/2013/02/pcafeb7.gif"><img src="/images/stories/2013/02/pcafeb7thumb.gif"></a>
 
PCA Queensland executive director Kathy MacDermott says the slowing resources sector has triggered a fall in demand to a four-year low with net absorption during the six-month period totalling a mere 2,406 square metres.
The against-trend fall in Sydney’s vacancy rate was masked to an extent by a high rate of withdrawals, but also from demand across the top end of the market.
 
<hr class="system-pagebreak">
 
Net absorption of office space in the Sydney CBD – the amount of space leased minus the amount of space vacated over a given time frame – totalled 8,466 square metres, but withdrawals were at a five-year high, with 87,903 square metres taken off the market.
Withdrawal of stock was strongest in the B- and C-grade markets – with 35,095 square metres and 36,257 square metres taken off ine respectively – as owners looked to refresh their offerings.
These were offset by 48,637 square metres of additions to the total commercial office stock.
“The premium market continues to enjoy strong demand – with 9,957 square metres of net absorption in the past six months – and its vacancy rate falling from 7.8 % to 6.3% in the past six months,” says Property Council NSW executive director Glenn Byres.
The A-grade office vacancy rate fell from 7.5% to 7.4% with net absorption totalling 10,166 square metres.
Commenting on the Sydney performance, Knight Frank managing director for NSW Richard Horne says there has been a marked improvement in sentiment and activity in the Sydney office market in the last four months.
“A large number of new mandates – both onshore superfund money and Asian-based offshore funds – are circling the market.
“These groups are mainly focused on the CBD, although selective suburban markets are starting to be considered. The sharp drop in borrowing costs have made our market very attractive on a world scale," he says.
“Knight Frank recently marketed 9 Hunter Street where interest was stronger than we've seen for many years, with 8 serious bidders. This bodes well for a strong year ahead,” he says.
The PCA report showed that demand for Australian office space in the six months to January dropped to less than half the 20-year average and was just one third of that recorded in the first six months of 2012.
On a more positive note, PCA chief executive, Peter Verwer, points out that overall vacancies sit below the historical average and the GFC peak with only four major markets recorded vacancies of more than 10%.
The four markets with vacancy rates above 10% are the Gold Coast, where the vacancy rate fell marginally from 21.5% to 20.3%; Canberra, which rose from 9.8% to 11.9% (and could rise higher in an election year), the Sunshine Coast, up from 13.6% to 14.1% and Crow’s Nest/St Leonards on the Sydney north shore, which rose from 10.7% to 12%.
“The capital cities of mining states went off the boil in the second half of 2012 and vacancy rates rose in two out of three markets across the country,” says Verwer.
“These vacancy numbers reflect the impact of insipid service sector growth and a resources industry engine that has moved down a gear”.
“Sluggish economic growth and weak demand for commercial space reinforce the need for a better targeted fiscal stimulus and further interest rate cuts,” Verwer says.
 
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Sydney the only partial bright spot as CBD office vacancies rise, with mining demand down: PCA

Perth’s new apartment market recorded its strongest quarter of sales since Q4 2021, with 412 apartments sold in Q1 2026 and a record quarterly sold value of $537 million, according to Urbis’ latest Apartment Essentials results.

Urbis said the March quarter result reflects strong, highly product‑specific demand across both ends of the market, from more attainable projects delivering at scale, through to premium stock being absorbed by equity‑rich downsizers.&nbsp;

David Cresp, Partner at Urbis, said the key story in Perth is not demand, it is the market’s ability to convert demand into delivered housing.&nbsp;

“This is the strongest sales quarter since Q4 2021, and it reinforces that demand in Perth is real and it’s local,” David Cresp said. “But the task now is delivery, turning that demand into projects that can actually be built and completed.”&nbsp;

[smartcode_project:default project_id=110291 project_image_fid=302785]

<h2>Affordable product leads, premium demand remains resilient</h2>

Sales in Q1 were led by more affordable projects, with The Boulevard (SKS Group) recording 115 sales in the quarter, the presentation noting this is only the second time a single project has surpassed 100 quarterly sales. The project was able to offer more affordable housing product right next to a train station.&nbsp;

Palmyra West (Finbar) also delivered strong results with 28 sales in Q1, following 84 sales in Q4, with an average price of under $800,000, underscoring depth of demand for well‑located, attainable new stock.&nbsp;

At the premium end, Urbis said downsizer demand is continuing, with the results highlighting Romeo (Applecross, Finbar) recording 75 sales and reaching almost 50% sold in one quarter.

Jual (Shenton Park, Celsius Property) also posted a strong quarter with 28 sales, reaching 39% sold in one quarter.

Urbis noted that Perth apartment demand is not speculative, not investor‑led, and not uniform, describing it as localised, often equity‑driven and highly product‑specific, a pattern reflected in the polarisation between strong “attainable” performers and premium downsizer product.&nbsp;

[smartcode_project:default project_id=148957 project_image_fid=364102]

<h2>Prices underpinned by costs, and the delivery risk is growing</h2>

Urbis said pricing pressure is cost not demand‑driven: construction costs and delivery risk are now a central constraint, with the results noting build costs remain elevated and volatile, and that energy, fuel and labour uncertainty weigh on feasibility.

David Cresp said a growing challenge for private Build‑to‑Sell developers is simply securing a builder in the current environment.

“Developers are really feeling the pressure from a building market that was operating at capacity and securing a builder is challenging,” David Cresp said, adding that even where a builder can be secured, “trying to get to the price that makes the development financially viable is incredibly challenging in the current market.”&nbsp;

Urbis’ broader WA commentary also notes that industry remains at or above capacity with lot and housing creation, and that many builders are limiting new sales to manage stretched workforces and fixed‑price contract pressures, conditions that flow directly into apartment feasibility and delivery timing.

[smartcode_project:default project_id=108869 project_image_fid=317905]

<h2>Supply: improving later, but still constrained, and Perth lags eastern benchmarks</h2>

While near‑term supply remains constrained, Urbis’ forecast shows completions lifting “Supply is forecast to be back above 1,500 apartments per annum for the first time since 2019”, with 1,775 completions forecast for 2026, and volumes remaining above that level over the following years.&nbsp;

Looking further ahead, completions are forecast to reach 2,500 in 2028, with the report noting 32% of that total is social/affordable, reflecting the role of government‑supported delivery in rebuilding the pipeline.&nbsp;

However, Urbis said Perth remains behind comparable markets on pipeline scale. In a national comparison of projects under construction, the report shows under construction Perth Build‑to‑Sell (BTS) at 3,446 apartments versus the Gold Coast at 7,922. Mr Cresp said “The challenge for Perth is how to we grow the delivery pipeline”.

Urbis’ conclusion is that Perth’s market is increasingly defined by product discipline and delivery certainty, with the research identifying “delivery certainty is key” and calling out builder risk and procurement models as core success factors, alongside “timing and staging”.&nbsp;

Joel Robinson

Perth apartment sales hit strongest pace since late 2021 as builder capacity tightens

<a href="https://www.apartments.com.au/developers/sammut-developments">Sammut Group</a> has secured development approval for its latest Brisbane apartment project, marking the Sydney developer’s next step in expanding its Queensland pipeline following the success of its debut Gold Coast development, Coast.

The approved project at <a href="https://www.apartments.com.au/new-apartments/44-glen-road-toowong-qld-4066">44 Glen Road, </a><a href="https://www.apartments.com.au/developments/toowong-qld-4066">Toowong</a> will deliver a 15-storey riverfront apartment building with 42 residences, significantly increasing the scale of the site’s previous approval for a smaller luxury scheme. Designed by Bureau^proberts, the development will comprise a mix of predominantly four-bedroom and two-bedroom apartments positioned to maximise Brisbane River and city views.

Sammut Director Julian Sammut said the group had been actively searching Brisbane for several years before identifying Toowong as the right fit.

“Brisbane was the right step for Sammut,” Sammut said.

“With the success of Coast we thought we should definitely look to do more in Queensland alone. We then pushed up to look at Brisbane. We've been looking for I'd say two to three years actually and it was hard to find the right location.”

<img alt="Sammut makes Brisbane apartment play" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/f_auto,c_limit,w_1440,q_75/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/field/image/Screenshot%202025-12-23%20at%203.27.14%E2%80%AFPM.png?VersionId=dYAVIL7qdcGA8ojvkslSrLjczXFejSSx" />

Sammut said suburbs including New Farm and Teneriffe were considered before the group ultimately focused on Toowong due to its strong downsizer demographic and limited supply of developable riverfront land.

The site was acquired off-market after what Sammut described as a lengthy negotiation and planning process, with the developer pursuing an uplift to the original approval.

“We are DA approved now which is very exciting,” Sammut said.

“We've had our change approval come through and we've obviously doubled the height, 15 storeys plus rooftop. We've got 42 amazing apartments that are going to be coming to market soon.”

<img alt="Sammut makes Brisbane apartment play" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,dpr_2.0,q_auto:good/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202025-12-23%20at%203.27.26%E2%80%AFPM.png?VersionId=ohkRkY0dIZlqdfME2EZePsCQavRiBadE" />

Bureau^proberts said the design responds to Toowong’s evolving urban character, balancing contemporary apartment living with the area’s established residential identity.

“A place where traditional Queensland living has taken place for centuries; Toowong is seeing a shift of contemporary influence, commercial and retail hubs mixed with well-considered residential offerings – all the while maintaining its character and charm,” the architect noted in planning documents submitted to Brisbane City Council.

The architecture practice said the project’s form was shaped by its riverfront setting, flood considerations, neighbouring building scales, and view corridors.

“They said the mix of four and two-bedroom apartments capture the ‘fundamental qualities of Queenslander living,’ translated into the context of a contemporary subtropical building.”

The development sits just off Coronation Drive within walking distance of Toowong’s retail precinct and the upgraded Regatta ferry terminal, while also benefiting from proximity to the incoming green bridge connection to West End. Sammut said the accessibility and amenity offering were central to the site’s appeal.

The approval adds to growing residential activity along the Toowong riverfront, joining nearby projects including Consolidated Properties’ Monarch Residences and Spyre Group’s ARC Residences.

Sammut secures approval for debut Brisbane apartment development in Toowong

Developer Lanevick is heading back into Sydney’s apartment market after focusing more heavily on the luxury townhouse and terrace sector in recent years.

Lanevick, founded and directed by Steve Maroun, is expecting to receive approval in the coming months for a new apartment development in Gladesville, with the aim to launch it to the market later this year.

The 51-apartment project, designed by Studio Johnston, will comprise a mix of one-, two-, and three-bedroom apartments positioned toward the Hunters Hill downsizer market.

“Traditionally it’s been difficult for people in that market to downsize because there just hasn’t been the right product available,” Maroun said.

“We’re targeting buyers who might have 30 to 40 per cent of their house value sitting in the bank after downsizing.

“They still want good spacious entertaining areas, they still want quality design, but they also want flexibility and the ability to enjoy life a bit more after working hard for a long time.”

The project sits near Boronia Park and within close proximity to the Parramatta River foreshore, an area Maroun says offers more of a Hunters Hill lifestyle than a traditional apartment precinct.

“From a lifestyle perspective, it’s really more Hunters Hill than Gladesville,” Maroun said. “You’re close to the foreshore, close to parklands, and still connected back into the village precinct.”

From level four and above, apartments will capture water views&nbsp;toward Sydney Harbour. Communal amenity will include rooftop entertaining areas, wellness spaces, and a gym tailored toward owner-occupier buyers.

“We’ve really designed these apartments around that buyer coming from the Hunters Hill LGA and what they’re actually looking for in their next chapter.”

The proposed development has also been designed to respond to the changing character of the broader Gladesville town centre, where a growing number of mixed-use and residential proposals are expected to emerge over the coming years.

“Gladesville presented a rare opportunity to deliver a genuinely design-led residential project within an evolving lifestyle precinct, just moments from the growing Gladesville town centre, and we’ve approached the project with a strong focus on architecture, liveability and long-term community value,” Maroun said.

Maroun said Lanevick saw a first-mover advantage within the precinct as planning controls continue to evolve to accommodate greater housing density.

“We think there’s a real opportunity there that hasn’t really been serviced properly yet,” he said.

“There’s going to be a broader evolution of the whole Gladesville village precinct over time, particularly with more activation and mixed-use outcomes.”

The Venus Street proposal will include a commercial and retail component at ground level designed to contribute to that evolving streetscape activation.

“A big part of the thinking was how do you activate that area properly and create more vibrancy and amenity, which is what Hunters Hill has been looking for,” Maroun said.

Lanevick’s focus since 2020 has largely been on smaller-scale luxury townhouse and terrace developments. The developer recently completed Royale Randwick, also designed by Studio Johnston, where prices reached $3.65 million. The project was featured in the UDIA NSW 2026 Professional Development Prospectus and was also named a finalist for Development of the Year.

&nbsp;

Lanevick to cater for Hunters Hill downsizers with new Gladesville apartment development

Property developer One Living, backed by former Macquarie banker turned investment manager Chris Green’s investment firm, has unveiled plans to bring more institutional capital into housing to help address the national supply crisis.

The New York-based investor has focused his firm, GreenPoint Partners, on addressing the supply shortage hitting middle market housing in Australia.

It is backing the new One Living business to develop more than 1000 units along the eastern seaboard. The new firm is starting with a development on Mona Vale Road, on the border of Mona Vale and Pymble, in Sydney’s Northern Beaches, with around 140 apartments planned. They are eyeing off more sites across the city.

With cost pressures rising in the industry, One Living’s model is to be a vertically integrated developer-builder, so it can respond directly to the housing gap by removing the cost inefficiencies embedded in traditional residential delivery.

“We are building a platform designed to operate at scale and starting in a market where there’s a clear need for quality, attainable housing,” One Living joint managing director Joseph Scuderi said.

“It’s that missing middle – it’s that attainable end of housing… that’s what most Australians invest into and what Australians can actually afford.”

<img alt="Mona Vale" data-entity-type="file" data-entity-uuid="798dfa93-4941-4db6-a696-31e9dc18e81c" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-28%20at%202.31.50%E2%80%AFPM.png?VersionId=mKBqi5C_DmeiXS.AtJkcR8LQIxqCqmFi" />

GreenPoint Partners brings years of experience assembling and scaling real estate operating businesses across major markets. And Green sees a big opportunity in Australia.

“For its size, sophistication and importance to the community, Australia’s living sector has remained largely under-institutionalised, which represents significant opportunity,” Green said. “GreenPoint identified that gap, assembled the right team, and is backing One Living to build a platform that is aligned to market needs.”

Green said being a builder-developer would give the company the capacity and flexibility it required to deliver reasonably-priced homes.

“We want it to be at that attainable level; not super high end luxury but at that attainable level,” he said.

<img alt="Mona Vale" data-entity-type="file" data-entity-uuid="74a5344a-4b26-4d4a-ada3-056b1220be77" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-28%20at%202.32.15%E2%80%AFPM.png?VersionId=vY8hXHO4reBMdO8ZXMWCNtGZJofUPQ3j" />

&nbsp;

One Living will undertake a component of affordable housing in its schemes, which it will own and operate, and it could also run build-to-rent on some sites.

Green praised local policy settings.

“The NSW government is being very supportive, strategic and pragmatic in terms of how do we generate more supply of housing,” he said. “We think it’s actually positive for development and the bit that’s been lacking at that attainable level is that it’s lots of relatively small private developers, whereas we want to create an institutional platform.”

One Living is also&nbsp;looking at high-density projects and could take on more institutional funding in the future.

“The way we will be able to achieve economies of scale is through size,” Green added.

One Living enters Sydney's new apartment market with Northern Beaches site acquisition

It's been several years since there's been an opportunity to buy a brand new townhome in Melbourne's coastal suburb of Mordialloc. Even apartment developments in recent times have been few and far between in the area.

Local developer LDS Property identified the gap in new housing, securing a site on White Street, directly opposite&nbsp;Woodlands Golf Club Mordialloc. They've recently launched&nbsp;<a href="https://www.apartments.com.au/new-townhouses/wm-residences-mordialloc-102-white-street-mordialloc-vic-3195">WM Residences</a>, just 13 townhouses which they have already started building.

Projects by Buxton Director Heath Thompson, who is selling WM Residences, says the townhouses x that perfect middle ground be

"Mordialloc residents have had limited options to downsize within the suburb, often forcing them to look elsewhere despite long-standing ties to the area," Thompson says.

"With very little comparable new supply coming to market, projects like WM Residences are well placed, particularly as buyers look to capitalise on current conditions amid constrained supply."

[smartcode_project:default project_id=134646 project_image_fid=6109]

The development, designed by regarded architecture firm&nbsp;<a href="https://www.apartments.com.au/architects/ewert-leaf">Ewert Leaf</a>,&nbsp;adopts a deliberately restrained architectural approach, focusing on simplicity, durability and liveability rather than overt design gestures.

The boutique scale is central to the offering. With only 13 three-bedroom residences, each home is configured to prioritise functional layouts and everyday use, supported by private terraces and secure two-car garages.

Ewert Leaf’s design response leans into a calm, neutral material palette. Interiors are defined by oak flooring, white walls and soft finishes, creating a consistent and understated backdrop. The approach avoids trend-driven detailing in favour of longevity, with an emphasis on natural light and spatial clarity.

[smartcode_project:default project_id=134646 project_image_fid=6110]

Beyond aesthetics, the homes are designed to meet contemporary performance expectations. Each residence targets a minimum 6-star energy rating, incorporating double glazing, comprehensive insulation and all-electric Bosch appliances.

The project’s location supports a walkable coastal lifestyle, sitting within close proximity to Mordialloc’s foreshore, Main Street retail strip and the train station. Local cafés and dining venues, including Suburbia Deli and Hendriks Café, are within a short walk, reinforcing the area’s established neighbourhood character.

[smartcode_project:default project_id=134646 project_image_fid=6116]

While <a href="https://www.apartments.com.au/developments/mordialloc-vic-3195">Mordialloc</a> is often defined by its beach and pier, the project taps into other areas of day to day living, offering easy access to local food, casual dining and transport, rather than positioning itself purely as a lifestyle retreat.

WM Residences reflects a continued trend across Melbourne’s coastal suburbs towards smaller-scale, design-led townhouse developments, particularly on infill sites where proximity to amenity is already established.

With construction commenced prior to its market entry, the project aligns with a growing preference among buyers for developments with visible progress and defined delivery timeframes.

[smartcode_project_cta:default project_id=134646]

Larry Schlesinger

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