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That annoying Coles jingle “Down, down, prices are down” (was there ever more reason to shop at Woolworths?) could easily be applied to the outlook for the cash rate in 2013 with economists revising their forecasts in expectation of further rate cuts over the course of the next 12 months.
The key questions remain how many more rate cuts there are likely to be in the current cycle and perhaps more importantly, if they will have any impact on buying intentions of key market segments like first-home buyers and upgraders.
Certainly rate cuts will be welcomed by the generally financially better off investor market, where activity already appears to be on the rise based on October housing finance figures from the ABS.
These showed a 5.5% rise in the value of fixed-rate investor home loans over the month of October, compared with 0.2% decline in the value of owner-occupier mortgages.
An improvement in the new housing market is also expected, with Westpac chief economist Bill Evans noting that residential construction sector has “turned the corner and will be supported by recent lower interest rates, a shift which has greatly enhanced housing affordability” as well as from the  $15,000 first-home buyer handouts for those buying or building a new home in NSW and Queensland.
Evans quotes ABS construction figures that show that new dwelling construction advanced by 3.7% in the September quarter, partially reversing a 7% decline over the previous five quarters.
In addition, he points to the October Westpac- Melbourne Institute consumer sentiment index, where the ‘time to buy a dwelling’ sub-index showed a very positive response rising to the highest level since late 2009.
“This suggests that a housing recovery is locked-in for 2013. However, we expect the upswing in activity to be relatively gradual to emerge and that the cycle will be restrained by historical standards. The main constraint is the high starting point for household debt. Our forecast is for new dwelling construction to rise by 4.5% through 2013 and by 5.0% through 2014,” he says.
However, the evidence of a recovery is less certain for established housing, which makes up the bulk of the Australian housing market.
Concerns remain about the fragile confidence of Australian consumers, with the November Westpac consumer index recording a drop in confidence to levels last seen before the RBA began cutting the cash rate in November last year, though mortgage holder confidence rose 4.4%.
The key take-home message from the November index were concerns about the <a href="https://www.propertyobserver.com.au/economy/households-growing-concern-about-job-market-point-to-further-rate-cuts-westpac/2012121358456?utm_source=po&amp;utm_medium=aida&amp;utm_campaign=latestnews" target="_blank">economy and job security are upper-most in the minds of consumers</a>, something a rate cut won't easily fix.
Despite 175 basis points being trimmed from the cash rate since November 2011, consumer confidence has not improved, with interest rate cuts appearing to lose their potency, a point observed by Laing+Simmons general manager Leanne Pilkington who, following the December rate cut, said they were no longer having any meaningful impact on <a href="/news">housing market activity</a>.
For the RBA, the focus will be on the job market and the non-mining sectors of the economy, including housing, taking up the slack with the 2014 mining investment peak now “confirmed”.
“Labour demand had softened, which pointed to only modest employment growth in coming months,” was arguable the key sentence in the December minutes, along with the RBA’s note that the “inflation outlook still afforded the board some scope to provide additional support to demand”.
ANZ has revised its estimates and is now tipping a further 100 basis points to be shaved off the cash rate over 2013, principally due to the slowdown in mining investment and an expected slow pick-up in non-mining sectors.
This would take the cash rate to an unprecedented 52 year low of 2% and could result in introductory variable loans being offered at around 4.4% (currently the cheapest variable loan offerings start from about 5.2%) assuming lenders pass on about 80 basis points to borrowers.
Standard variable mortgage rates would fall to around 5.6%, while the three-year fixed rate would fall well below 5%.
AMP Capital chief economist Shane Oliver is tipping at least two more rate cuts next year (in February and April), taking the cash rate to 2.5%, but warns that the cash rate could fall below 2% if the recovery in key non-mining sectors like retail, housing and tourism is slower to eventuate.
According to Oliver, in the current environment “of household and business caution post-GFC” the neutral standard variable rate has likely fallen to around 6.75%.
“In the last two easing cycles the mortgage rate had to fall to around 6.05% in 2002 and to 5.75% in 2009.
“Given the fall in the likely neutral level for mortgage rates and the current headwinds coming from the strong Australian dollar and fiscal tightening, mortgage rates will at least need to fall to these lows.
“Given ongoing issues with bank funding, to achieve a circa 6% mortgage rate the cash rate will need to fall to around 2.5%,” he says.
Oliver is quite bullish on the impact that lower rates will have on the housing market.
“Based on the assumption that the RBA cuts interest rates further and the global economy stabilizes then Australian economic growth should pick up by the end of next year.
“One should not underestimate the boost lower mortgage rates will ultimately provide. A fall in mortgage rates to 6% from the 2011 high of around 7.8% is equivalent to around $4500 pa in interest savings on a $300,000 mortgage. Ultimately some of that will be spent.
The key question remains though if lower interest rates will have enough of an impact on the housing market to spur a pick-up in activity.
Westpac’s Bill Evans anticipates one more rate cut on February 5 when the RBA next meets, but tellingly adds that “evidence to date is that low rates are not achieving traction with the hearts and minds of households or business”.
But he says the RBA is unlikely to concede that its primary policy instrument is ineffective.
However if the cash rate does fall to 2% and bank mortgage rates follow downwards but home buyers stay away, the uncomfortable question for the RBA and economists will be: where to next?
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lschlesinger-FZcF9M3vE6

Down, down, interest rates going down in 2013, but will they make a difference?

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Unless you have a reliable crystal ball, predicting how the property market will shape up in 2013 is a tough call to make.
Uncertainties include how the global economy will play out and impact on Australia, the extent of the slowdown in the mining investment boom and how quickly non-mining sectors like retailing, housing, manufacturing and tourism can pick-up the slack.
Economists are tipping interest rates to fall further in 2013 and reach record lows, which will be good news for mortgage holders, but astute buyers and investors will recognise the economic warning signs.
Lower interest rates are having less of an impact on buying intentions, with confidence seeming to be the major stumbling block.
Still, many property market players are tipping modest property gains in 2013 for some markets, while others are set to tread water or fall further.
Property Observer has spoken to a wide range of industry players and pundits to get their thoughts on what might happen next year.
Here are 10 tips from property market analysts about what to expect in 2013:
1. Sydney to do better, but best NSW prospects still in the regions: Terry Ryder
Hotspotting.com.au’s Terry Ryder expects the Sydney market to do better in 2013 but still tips a number of NSW regional towns to outperform the capital city. Regional towns, he says, are more affordable and have provided much better capital growth over recent years. He expects the following regional market to continue to outperform Sydney in 2013: <a target="_blank" href="/news">Dubbo</a>, <a target="_blank" href="/news">Tamworth</a>, <a target="_blank" href="/news">Gunnedah</a>, <a target="_blank" href="/news">Mudgee</a>, <a target="_blank" href="/news">Orange</a>, <a target="_blank" href="/news">Goulburn</a>, <a target="_blank" href="/news">Albury </a>and <a target="_blank" href="/news">Wagga Wagga</a>. For more on <a target="_blank" href="/news">capital city vs regional prospects in 2013 watch the full webinar</a> with Terry Ryder.
2. Luxury market to recover first: Janusz Hooker
LJ Hooker deputy chairman Janusz Hooker says a recovery in the housing market is “inevitable”, with the luxury high-end market expected to be the first to enjoy price recovery having been hit the hardest by the downturn. His advice to property investors is to “look for places that went down the most and also watch the big cities – when they move it fans out to the regions usually within six to 12 months”.
3. Sydney sub-$750,000 market the strongest in Australia’s “BHP of real estate”: John McGrath
McGrath Estate Agents CEO John McGrath says recent weekend clearance rates indicate clearly that the under-$750,000 market is still strongest in Sydney, with McGrath averaging a 69% clearance rate in this bracket, followed by 65% for the $750,000 to $1.5 million sector. "Sydney remains the <a target="_blank" href="https://www.propertyobserver.com.au/residential/the-end-of-the-buyers-market-drawing-near-with-australian-property-prices-set-to-rise-in-2013-john-mcgrath/2012121658475/Page-1?utm_campaign=observers&amp;utm_medium=aida&amp;utm_source=po">BHP of Australian real estate</a> – the big blue-chip market that generally outperforms the rest, says McGrath, who predicts a 2% to 5% price rise in the under-$750,000 market and a 5 to 8% rise in the $750,000 to $1.5 million bracket.
4. Consider the outer suburbs of Adelaide and Brisbane: Margaret Lomas
Destiny Financial’s Margaret Lomas says property investors are starting to take a look at the outer suburbs of Adelaide and Brisbane, with activity picking up towards the end of 2012. These were areas were house prices started to move up a little bit in contrast to the rest of the market, which mostly stagnated, she told realestatetalk.com.au.
5. Rent vs buy equation to sway more first-home buyers and renters into the market: Tim Gurner
Tim Gurner, director at Melbourne-based property development company Urban Inc, says the buy versus rent equation will sway strongly towards buying in 2013, “so we’re expecting to see a lot of first home buyers and renters return to the market”. Urban Inc is currently developing Alessi in West Melbourne.
6. Perth and Sydney to perform, Brisbane held back by unemployment: Aaron Maskrey
Aaron Maskrey, research director at PRDnationwide, expects Sydney to experience steady, but modest growth of around 5% throughout the upcoming year. He says Perth should also be a stronger performer in 2013, with a combination of mining investment and low interest rates helping to shift this market off the bottom of its property cycle. “A conservative estimate of price growth during 2013 would see Perth increase in value by 2%, but such is the swing with this resource affected region, greater market sentiment could give rise to 6% growth." Maskrey says Brisbane finds itself in a similar situation to Perth and would have been included with Perth’s forecasted growth but for the sharp rise in unemployment. “With a rising rate of jobless residents, any potential growth that was initially forecasted for Brisbane is now expected to be temporarily suppressed in early 2013,” he says.
 
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7. A more generic uplift in property prices for Sydney then Melbourne: Matthew Chun
Becton CEO Matthew Chun is more bullish on the Sydney property market than Melbourne in 2013. Chun tells Property Observer he expects “meaningful price growth” in Sydney of 4% to 8% with modest growth of 2% to 4% in Melbourne. Chun also expects a more generic recovery across the Sydney market, while Melbourne will be restricted to growth from unique, well-located properties within 10 kilometres of the CBD. “Outside of this zone growth will be flat, and I also don’t expect much growth in the Melbourne apartment market,” he says. Becton's two key projects are Divercity in Waterloo and Newleaf in Bonny Rigg in the west of Sydney.
8. West Melbourne land market has better prospects: Jeff Garvey, director of ID Land
Jeff Garvey, director of Melbourne residential developer ID Land, says the outer west growth corridor, which includes suburbs like <a target="_blank" href="/news">Truganina</a> and <a target="_self" href="/news">Plumpton, </a>have good prospects, in contrast to the perception that the Melbourne land market is struggling. Garvey says the area is supported by “really big infrastructure projects” including the $5 billion regional rail link running from Southern Cross to Werribee and due for completion in 2016. In addition, Truganina is only 20 kilometres from the Melbourne CBD. 
9. Don’t expect or wish for the cash rate to reach 2%: Joe Sirianni
Joe Sirianni, executive director at mortgage brokers Smartline, anticipates only one more rate cut in 2013 and says were the cash rate to fall to 2% it would undermine confidence, which he says is the key issue. “We’re living in changing times and the use of interest rate cuts as a lever to stimulate the economy just isn’t having the same impact as it has in the past. Therefore, I think the RBA will realise that there is little point in going much lower with the cash rate.  A cash rate of 2% would be unprecedented in Australia, and I think there’s a danger that if rates were cut to this level, it would un-nerve most people and exasperate the already low levels of confidence,” says Sirianni.
10. A modest recovery in new housing in NSW in 2013 with better buying conditions: Craig D'Costa
Craig D'Costa, senior development manager of Sekisui House, a co-developer of the $2 billion Central Park project in Sydney, says a recovery in the housing industry will be a key factor in boosting the NSW economy. "The housing industry is forecasting NSW to achieve a modest increase in housing starts for 2013, this comes of the back of government led stimulus for new home buyers with substantial saving in stamp duty and grants. Overall, improved affordability and better buying conditions will underpin home buying activity next year in 2013, with upgraders and investors also likely be very active sectors," he says.
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The 10 insights into the 2013 property market: What, why, when and where to look

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The Gold Coast apartment market remains deeply troubled with developers reporting only 19 high-rise apartment sales over the November quarter, a 70% plunge from sales figure a year ago, according to the latest Midwood Report.
Quarterly sales figures were more than double the paltry eight sales recorded in the August quarter, but just a fraction of the 73 sales recorded in November quarter of 2011.
In total there are 705 high-rise apartments available for purchase on the Gold Coast, which at current sales rates would take close to a decade to clear.
The Midwood report classifies high-rise sales as those developments of 40 storeys and higher.
All but three of the sales over the quarter were in the Brookfield Multiplex-constructed $700 million Hilton Surfers Paradise (pictured below), following prices being reduced by up to a third.
<img alt="hiltonsurfers" height="346" width="470" src="/images/stories/2012/12/hiltonsurfers.jpg">
There were no sales reported in the two other major high-rise apartments – Niecon’s Oracle and Juniper’s Soul, both of which are in the hands of receivers.
The Midwood report records just 45 total unit sales on the Gold Coast over the November quarter, compared with 107 in the corresponding quarter last year.
Putting this in context, there were 386 apartment sales recorded in Brisbane over the same period, more than three times more than the 110 apartments sold a year ago.
In the Hilton, prices ranged from $495,000 for a two-bedroom, one-bathroom apartment over 76 square metres to $1.63 million for a two-bedroom, two bath apartment over 118 square metres.
According to 360 Project Marketing, which is marketing the Hilton apartments, buyers have snapped up more than $15 million in apartments during the past three months, following a recent reduction in prices of up to 34%.
Marketing director Trent Milburn of 360 Project  says the new price tags have stimulated buyer activity across the board.
The project also has Foreign Investment Review Board (FIRB) approval, and Milburn says many of the buyers have come from south-east Asia.
“A month ago a foreign buyer could have purchased an apartment in the development for under $500,000, two months ago they could have bought for under $450,000 – now we’re at $525,000 and headed for $600,000.
Since January, 65 apartments have sold at prices between $435,000 and $2.3 million, with the final sub-penthouse currently on the market for $3.45 million.


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Out of the 410 apartments across the Boulevard and Orchid towers in the Hilton development, 134 remain up for sale.
Midwood reports two sales – one each in the Oceana and Solitaire Towers – as part of the Element Burleigh Beach project being developed by Amalgamated Property Group and marketed by CBRE, which is nearly sold out.
A further sale was recorded at Southport Central III, the Lindaning Pty Ltd/Colliers International development in the hands of receivers, with 87 out of 258 units still available for sale.
Report author Bill Morris notes that high-rise sales “continue to be sluggish”, with only the Brookfield Multiplex/360 Project marketing Hilton recording a reasonable volume, having re-introduced 109 apartments when contracts had fallen over, and discounted them by 30%.
“Oracle and Soul are only recently in receivership and the liquidators have yet to mount a solid marketing campaign and price list,” says Morris.
Morris notes that a new project, Broadbeach Central has been announced by Amalgamated Property Group and Morris Property Group on Main Street Broadbeach, however off-the-plan sales have yet to commence.
There was little for investors to cheer about either with rents unchanged across both units and houses.
Median weekly rents for one-bedroom apartments are unchanged from two years at $290 while the median two-bedroom apartment rent is up slightly from $340 in 2010 to $350 currently.
The Gold Coast market has been hit by both a slowdown in interstate and overseas migration into Queensland over the last few years with regional population growth slowing from 3.4% in 2001 to 2.1% in 2011.
Overseas migration numbers have nearly halved from around 60,000 per year in 2008-09 to just over 30,000 in 2010-11 while interstate migration has fallen from around 27,000 in 2007-08 to less than 10,000 in 2010-11.
The Midwood report notes that he recent downturn in Queensland net overseas migration is clearly a result of the lack of employment opportunity.
“With Queensland’s two biggest employers, construction and hospitality industries in the worst position we have seen since pre-GFC, migrants are choosing to settle elsewhere,” says the Midwood report.
The Midwood report shows that the number of apartments approved for development increased over the six months to June 2012 from 450 to 490, but numbers have been trending down since the GFC, when there were more than 1,800 apartments approved in the second half of 2007.
 
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Heavily discounted Hilton Surfers Paradise the only notable Gold Coast high-rise seller in November quarter: Midwood 

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The last few months of 2012 were noticeable for the manoeuvrings of arguable the three most recognisable mortgage broking brands: Aussie, Mortgage Choice and newish kid on the block, Yellow Brick Road.
All three franchise groups have taken steps to shore up their revenue-generating capabilities in what is likely to a challenging 2013 for mortgage lending and the housing market.
Each brand has adopted a different growth strategy, but the ultimate objective is the same – grow market share, increase revenues and improve profitability. The most recent media attention has been focused on John Symond selling the majority of <a href="/news">his Aussie Home Loans business to the Commonwealth Bank</a>.
Should the ACCC wave the chequered flag, Australia's biggest home lender will go from minority shareholder (33%) to owning 80% of Aussie Home Loans with the right to acquire all of the business at a later stage, should the bank deem it prudent.
It certainly is a prudent move from John Symond (apart from increasing his already substantial personal wealth), who will brush away criticisms that the once bank-bashing battler Aussie brand is now bank-owned.
Having re-positioned Aussie as a mortgage broker in 2002 rather than primarily as a non-bank lender prior to the GFC funding freeze (though it still offers Aussie-branded loans) the investment by the Commonwealth Bank  – said to be around $160 million –will ensure Aussie can continue to grow its retail stores, mortgage broker numbers and brand.
"Our feeling is it is a bigger, better Aussie with more choice and services for consumers, and that has to be good for competition,” he told Property Observer's sister publication <a href="https://www.propertyobserver.com.au/industry-news/aussie-john-symond-explains-sale-to-cba/2012121958587?utm_source=po&amp;utm_medium=aida&amp;utm_campaign=news" target="_blank">SmartCompany.</a>
Symond’s former non-bank Wizard rival Mark Bouris has also taken a number of decisive steps in recent months aimed at ensuring his fast-expanding Yellow Brick Road franchise business has the funding it needs to provide competitive home loans and can generate enough leads to keep its 140 or so franchise stores busy and profitable.
The well-connected Bouris tied up a wholesale funding deal with <a href="/news">Macquarie Bank in November</a>, (which is itself ramping up its mortgage lending) and this month signed a reciprocal referral agreement with <a href="https://www.propertyobserver.com.au/industry-news/yellow-brick-road-and-run-property-form-property-and-financial-services-referral-alliance/2012121758542" target="_blank">property management group RUN Property</a>. Under the agreement Yellow Brick Road franchisees will offer their home loan and wealth management products and services to RUN’s 40,000 client base, many of whom are property investors.
Macquarie Group, of which Macquarie Bank is a subsidiary, cemented its ties with Yellow Brick Road by acquiring an 8.3% shareholding just ahead of the Christmas break with Yellow Brick Road strategic adviser and Australian Financial Review columnist Christopher Joye investing $1 million through Coolabah Ventures business entity.
Business Spectator's Stephen Bartholomeusz points out that in a twist of irony, Macquarie was the bank that originally funded John Symond's push into mortgage lending and is now doing something similar with his long-time rival.
 
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Mortgage Choice may not have sought or garnered the headlines that Bouris and Symond have managed, but the ASX-listed franchise has also been re-jigging its business model and building on its strategy of diversifying its offering.
In December, as it celebrated its 20th anniversary, Mortgage Choice opening its first financial planning franchises in Sydney and another one in Brisbane.
The focus will be on providing risk insurance products – a natural fit to its home loan business – as well as superannuation and investment advice.
Mortgage Choice aims to have 10 financial planning stores up and running as part of a “soft launch” with a full roll-out planned from July 2013.
The franchise has ambitious plans for its financial planning business.
Looking ahead over the next two decades, Mortgage Choice CEO Michael Russell says the company has plans to “revolutionise the financial planning industry in the same way it did the home loan business”.
“We have put in place the solid foundations needed to successfully transition from a home loan specialist into the full financial services provider our customers have been asking for,” he adds.
These developments are good news for shareholders in these three businesses, but smaller mortgage broking groups could find the going a lot tougher, with further consolidation activity likely in the coming months.
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Mortgage broking big brands position themselves for challenging 2013 with diverse strategies

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The Sydney median house price gained just 0.4% in the September quarter while unit prices were unchanged as the strongest growth was recorded in outer suburbs to the west and north, according to the latest figures released this week by the Real Estate Institute of NSW (REINSW).
The median Sydney house price stands at $567,000 still 3.1% down over the 12 months to September while the unit price stands at $460,000, down 1.1% over the same period.
The inner and middle suburbs of Sydney have borne the brunt of house price declines with the median house price for inner city suburbs down 2.8% over the past 12 months to a median $1.03 million while middle suburb house prices have fallen 3.3% over the same period to $720,000.
House prices in the prestige Eastern suburbs local of Woollahra have fallen 21% over the past year from $1.9 million to $1.45 million from 90 sales while houses in Mosman on the north shore have fallen 15% from $2.25 million to $1.9 million with 279 sales recorded.
The outer suburbs, predominantly in the west, were the ‘good news’ story, having avoided the drops experienced in inner and middle parts of the city, with the median house price remaining stable at $460,000.
Unit prices made their strongest gains in the Blue Mountains LGA rising 8.6% to a median of $315,000 with four of the top performing unit markets in Sydney’s outer west. The exception was Ku-Ring Gai to the north.
Across Sydney, the more affordable unit market performed decidedly better than houses with 25 Sydney LGA recorded gains in their unit prices and only 15 recorded falls. The Manly LGA recorded the biggest annual fall in unit prices – 8.5% to a median of $670,000.
Top five performing Sydney LGAs year to September 2012 - Units
<table cellpadding="0" cellspacing="0" border="1"><tbody>
<tr>
<td width="154" valign="top">
LGA
</td>
<td width="154" valign="top">
Median price
</td>
<td width="154" valign="top">
Gain over year
</td>
</tr>
<tr>
<td width="154" valign="top">
Blue Mountains
</td>
<td width="154" valign="top">
$315,000
</td>
<td width="154" valign="top">
8.6%
</td>
</tr>
<tr>
<td width="154" valign="top">
Campbelltown
</td>
<td width="154" valign="top">
$256,000
</td>
<td width="154" valign="top">
6.1%
</td>
</tr>
<tr>
<td width="154" valign="top">
Camden
</td>
<td width="154" valign="top">
$324,000
</td>
<td width="154" valign="top">
6.1%
</td>
</tr>
<tr>
<td width="154" valign="top">
Ku-Ring Gai
</td>
<td width="154" valign="top">
$662,000
</td>
<td width="154" valign="top">
5.3%
</td>
</tr>
<tr>
<td width="154" valign="top">
Bankstown
</td>
<td width="154" valign="top">
$346,000
</td>
<td width="154" valign="top">
4.4%
</td>
</tr>
</tbody></table>
Source REINSW
There were only 13 Sydney LGAs that recorded house price gains over the year to September with 26 LGAs recording falls.
The top performer was Camden in the south west, which managed a gain of 2.8% to a median of $452,250 over the year to September with the outer western suburbs (Penrith, Wollondilly, Bankstown) again prominent among the top performers, with Drummoyne in the inner west the exception to the rule.
Top five performing Sydney LGAs year to September 2012 - Houses
<table cellpadding="0" cellspacing="0" border="1"><tbody>
<tr>
<td width="154" valign="top">
LGA
</td>
<td width="154" valign="top">
Median price
</td>
<td width="154" valign="top">
Gain over year
</td>
</tr>
<tr>
<td width="154" valign="top">
Camden
</td>
<td width="154" valign="top">
$452,250
</td>
<td width="154" valign="top">
2.8%
</td>
</tr>
<tr>
<td width="154" valign="top">
Penrith
</td>
<td width="154" valign="top">
$380,000
</td>
<td width="154" valign="top">
2.7%
</td>
</tr>
<tr>
<td width="154" valign="top">
Drummoyne
</td>
<td width="154" valign="top">
$1,100,000
</td>
<td width="154" valign="top">
2.5%
</td>
</tr>
<tr>
<td width="154" valign="top">
Wollondilly
</td>
<td width="154" valign="top">
$438,000
</td>
<td width="154" valign="top">
2.4%
</td>
</tr>
<tr>
<td width="154" valign="top">
Bankstown
</td>
<td width="154" valign="top">
$540,000
</td>
<td width="154" valign="top">
2.3%
</td>
</tr>
</tbody></table>
Source: REINSW
There were much strong gains in some of the major regional towns headed by the Upper Hunter, with its house prices up 11.1% to a median of $306,000 ahead of Greater Lithgow, which recording a 9.6% gain to $232,500 and Singleton, up 7.5% to a median of $428,000.
There were also gains for Bathurst (up 5.4% to $510,000) and Dubbo (up 3.8% to $269,500).
However, the regions were very much a mixed bag with losses recorded in Wagga Wagga (down 3.3% to median of $300,000), Tweed (down 5.1% to $438,000), Port Macquarie Hastings (down 3.1% to $376,500) and Kempsey (down 8.6% to median of $267,500).
Wollongong house prices are down 2.2% for the year to a median of $440,000 while Newcastle house price are down o.5% to a median $385,000.
Commenting on the Sydney metropolitan market, REINSW chief executive Tim McKibbin says the flow-on effect from interest rates has yet to be seen.
“As conditions in the US improve, it is having an impact on our market and the overly cautious outlook we have had is beginning to ease.
“While we will not see sharp rises in property in 2013, we do expect to see consistent growth,” he says.
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Sydney house and unit prices continue to tread water with strongest gains in far outer suburbs: REINSW

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Mortgage industry bigwig John Symond has tipped a gradual improvement in the housing market in 2013 and for interest rates to fall further.
“I am pretty confident the housing market throughout the country has bottomed out,” he says.
Symond believes there will be a “very gradual increase in [property] values across the board”, but not the 15% or 20% annual spike that occurred pre-GFC.
Mirroring comments made by<a href="https://www.propertyobserver.com.au/https://www.propertyobserver.com.au/news/no-housing-price-crash-but-if-pries-increase-further-australia-flirting-with-danger-glenn-stevens/2012121858581" target="_blank"> RBA governor Glenn Stevens </a> about sustainable house price growth, Symond said such price spikes were “not healthy”
Rather, he says a gradual increase of 4% to 5% would be “a good healthy return year-on-year”.
“I believe the property market will now head into a healthy state of growth with only gradual increases and that is on the back of low interest rates,” he says.
He is also starting to see a return of property investors to the market due them having the “greatest choice in the number of properties on the market in Australia’s history” combined with the low interest rates.
“I am confident we will see a healthy gradual improvement in housing across the country and I believe the regional centres will see that increase as well because overall Australia still has a shortage of housing,” he says.
Symond says he also expects interest rates to head lower in 2013.
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Property has bottomed out and heading for “healthy" growth rates of around 4% to 5% per annum”: John Symond

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Reserve Bank governor Glenn Stevens has played down concerns of house prices crashing but has indicated the RBA would act if prices started rising by 10% to 20% per year alongside rising household debt levels.
He urged Australians to be more comfortable with more modest increases in house prices, describing double-digit house price growth as both “puzzling and “troubling”.
He also suggested the RBA would be comfortable with the cash rate falling below 3%, adding that there was no “particularly clear evidence” that monetary policy is failing to work, as part of an interview with the Australian Financial Review.
“We’ve seen some pick-up in housing prices, as you’d expect with interest rates coming down, but I don’t think we’re seeing at the moment a dangerous leveraging up there by households,” he said.
Stevens said his position was that house prices in Australia were high, but when comparing to a range of other countries, not just the US, it was “actually a lot harder to make the case that they’re grossly overpriced and due for a crash”.
“After all, we’ve been around this level of house prices/income for 10 years – [it’s] taking a long time to burst if it is a bubble.
“So I’m not so much concerned about a crash, but as I have said also before, it’s seems to me we would be flirting with danger were we to see a very big run-up from these present levels,” he said.
Stevens said the RBA was comfortable with “gentle reversal” of the 10 or 15% decline that has already occurred” noting that there had been “some gain in house prices over the past year”.
But he said it would “troubling” if there were a return to “very strong 10 to 20% per year persistent rates of growth of housing prices, especially if that was accompanied by a return of rising leverage”.
“I think that would be a very dangerous thing to do, and we would be imprudent in the extreme to preside over that,” he said.
He tempered these remarks by saying that he did not expect such a scenario to unfold.
In the interview he also acknowledged that the drop in house prices had impact on the residential construction sector, dampening the confidence of builders and their lenders because “nobody wants to build an asset whose price is going down as you build it”.
He said the seeming end of the downturn in prices would be helpful in getting some more construction going, but added that being comfortable with modest house price growth was also important in a recovery for this sector.
He also noted that he had expected the housing construction sector to pick up earlier than expected, but said “there are some signs of that looking like it’s about to go up now”.
On the issue of interest rates, Stevens said that a cash rate of 3% was not an emergency setting as was the case four years ago, but that the low rate had been “calibrated” for the current circumstances.
He said there was no “particular totemic significance” to be attached to the cash rate going below 3% per cent “if it needed to do that”.
Economists are tipping a cash rate below 3% in 2013, with ANZ expecting four more rate cuts to an unprecedented rate of 2%.
Stevens acknowledged that interest rate futures markets were pricing in further cuts but said the RBA would “have a look in the New Year and see how things look”.
“But I think we have to recognise that we are in a very unusual world internationally. It is a very important conditioning factor that the rate of interest out of the global money centres is nil.
“A 3% rate for us, which is very low by historical standards, is, by global standards, pretty attractive for others.”
He added that it needed to be accepted that the international situation has impacted on where the RBA sets its cash rate.
“But whether or not we need to go lower, we’ll see how that turns out in the new year.”
 
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No housing price crash, but if prices increase further Australia ‘flirting with danger’: RBA's Glenn Stevens

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Landlords could find themselves bearing heavy losses if their properties are rented by tenants who  undertake criminal activities if they don’t take out extra insurance to cover this sort of behaviour.
However, investigations by Property Observer indicate that obtaining the extra insurance needed may be hard to come by, with many insurers not readily covering this kind of activity.
It especially highlights the importance that property managers properly vet prospective tenants before signing lease agreements.
The issue has come to light following the reporting of two drug labs uncovered in rental properties in Melbourne and on the Gold Coast in the last few months.
In September, the Herald Sun reported that property investor Nicholas Milan Wyman would sue his property manager after suffering extensive damage his rental property in St Leonards, Sydney, which was used as a drug lab and where a corpse was dismembered.
Last week, the Gold Coast Bulletin reported that a police drug raid uncovered a drug lab in a rental property<a href="https://www.propertyobserver.com.au/landlords/how-queensland-property-insurance-can-help-if-a-drug-lab-is-found-in-an-investment-property-amanda-haack/2012121858560?utm_source=po&amp;utm_medium=aida&amp;utm_campaign=observers" target="_blank"> on the prestigious Isle of Capri.</a>
Property Observer recently contacted the major landlord insurance providers, but only one – Terri Scheer Insurance – provided a definite response to the question of landlord recompense cover for criminal activity.
Another insurance provider, Perth-based EBM Insurance Brokers, has subsequently contacted Property Observer to say that its RentCover landlord insurance does cover drug lab clean-up costs and recently paid out a $50,000 claim to clean up a property used as a drug lab in Hoxton Park, NSW.
According to RentCover general manager, Sharon Fox-Slater, police discovered the laboratory by chance when investigating a child abuse allegation; the home was occupied by a family with four children aged under 10.
Fox-Slater says in this case the alleged crooks were careful with gardens well-kept and the four-bedroom home "immaculate during property inspections, with the laboratory dismantled".
“We treated the claim as tenant damage because the ongoing liability is massive if the property is not cleaned correctly,” she said.
A spokesperson for Allianz Australia said the company could not provide any comments in relation to the example of the St Leonards drug lab story.
“We have looked into it, but there are some many potential complexities and unknowns in the scenario provided below that it is not possible to provide a simple response as to whether our landlords policy could respond in full or part to such an event,” said the spokesperson.
A spokesperson for CGU said the insurer had no comment.
Aon said it could not comment, though it does provide a professional indemnity policy for property managers with a “mismanagement extension”.
 
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This extension provides protection from allegations of negligence arising from any claim arising as a result of an actual or alleged breach of the agent’s professional duty as a property manager, including malicious damage to a rental property or loss of income or value to a rental property as a result of illegal activity by tenants (including drug labs).
Terri Scheer Insurance manager Carolyn Majda said criminal activity by a tenant that results in damage to the rental property “may be covered by insurance – provided there is a tailored landlord insurance policy in place”.
Terri Scheer Insurance offers tailored insurance policies to cover landlords for many risks including malicious and accidental damage, loss of rental income and legal liability.
“Landlord insurance policies that cover these specific risks can assist landlords to safeguard their investment and ensure they continue to receive a steady flow of rental income,” Majda says.
“A good landlord insurance policy that covers malicious damage – for example holes punched in walls, doors that have been kicked in and intentional damage to carpets and floors - will class illegal activity within this category.
“Loss of rental income resulting from criminal activity may also be covered by landlord insurance, for example, if the landlord is unable to lease the property while it is repaired or cleaned, or if the tenant absconds before their lease is up for renewal.
“This is why every landlord should have a tailored landlord insurance policy,” she says.
“Landlord insurance policies that cover these specific risks can assist landlords to safeguard their investment and ensure they continue to receive a steady flow of rental income.
Majda says the policy should also provide cover if a court orders a tenant’s eviction or terminates the rental agreement due to tenant hardship.
“A standard building and contents insurance policy generally won’t cover landlords for many of these risks,” she says.
From January 1 next year, all real estate licensees in NSW will be required to have mandatory professional indemnity insurance with cover of at least $1 million for any one claim and not less than $3 million in the aggregate for all claims made during the period of insurance.
Photo by West Midlands Police courtesy of <a href="https://www.flickr.com/" target="_blank">Flickr</a>.
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Drug labs: landlords exposed if tenants undertaking criminal activity

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The north-west Melbourne satellite town of Sunbury has proved popular with Sydney and Melbourne commercial property investors with three properties selling recently on strong yields.
The top yield was achieved for a Sunbury childcare centre on Cornish Street, which sold privately for $2.31 million, equating to a sharpish yield of 8.45%.
The property is leased for 10 years with a 10 year renewal option to G8 Education – ASX listed operator with over 130 centres across Australia.
The property was marketed by Burgess Rawson’s Adam Thomas, who has sold a number of childcare centres over the course of the year including in Doncaster, Sydenham, Maribynong and Cranbourne,
The premises of a Subway store, with a five-year lease and renewal options to 2024 on the corner Station &amp; Evans Street in Sunbury, sold at auction last week for $610,000 on a yield of 6.55%.
The price exceeded the reserve by around 10% and was picked up by a "cashed-up Melbourne investor" according to Thomas.
And the 940 square metres premises of two showrooms leased to national car repair firm Midas and tyre retailer Beaurepaires until 2019 sold under the hammer for $2.9 million - $100,000 above the reserve on a yield of 6.25%.
Thomas says the sales demonstrate the appeal of Sunbury as a town in its own right and the appeal of commercial properties with strong and secure tenants.
Sunbury, about 40 kilometres north west of Melbourne, has a population of around 30,000 people.
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Investors snap up Sunbury commercial properties at yields ranging from 6.25% to 8.45%

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A pick-up in both population growth and overseas migration bodes well for the housing market, according to CommSec chief economist Craig James.
Australia’s population grew by 359,600 people over the year to June 2012 to reach 22,683,600 people with its annual population growth rate rising from 1.49% to 1.61% – a near three year high.
A total of 208,300 people migrated to Australia over year to June - the fifth consecutive quarter that annual migration has increased, with Western Australia claiming 23% of Australia's total net overseas migration for the year compared with 18% for the previous year.
WA managed population growth of 3.3% over the 12 month period - double the Australian average - and on the verge of breaking Queensland's record for highest interstate migration.
In absolute terms, Victoria had the highest number of new arrivals (both interstate and overseas) totalling 89,000 followed by Queensland (86,000) and NSW (78,900) and WA (78,000).
James says the latest population figures are “encouraging”.
“Population growth is again rising, underpinned by migration. And if more people are coming to Australia that means greater demand for houses, cars and retail items. Clearly faster population growth is good news for builders and retailers,” he says.
A similar point was made by Chart Keck Cramer’s Robert Papaleo with reference to the struggling Melbourne land market.
According to Papaleo, a pick-up in overseas migration will have flow-on effects for the Melbourne property market and help spur a recovery in the fringe residential new housing market.
“Net overseas migration has come off the bottom of its cycle, but there is usually a 12 to 18 month lag before it feeds into the housing market,” <a target="_blank" href="https://www.propertyobserver.com.au/victoria/long-slow-road-to-recovery-for-melbourne-residential-land-market-with-prices-to-fall-further-charter-keck-cramer/2012121158413/Page-2">he told Property Observer.</a>
A pick-up in overseas migration could result in a rise in demand for fringe housing from these new arrivals but could also see them acquiring established housing and those displaced residents choosing, in some cases, to buy a lifestyle property on the outskirts of the city.
According to James, a pick-up in migration is also positive from a longer-run point of view in that it flattens out the ageing profile.
“We will need more in the way of younger people over time to support the growing ranks of pensioners,” he says.
James does include the counter-argument that faster population growth may not always be a good thing.
“It is all about striking the right balance. If we need more workers and we can’t get them locally, it makes sense that we bring them in from abroad. It is vital that supply and demand for workers is brought into balance,” he says.
 
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Population and migration pick-up likely to deliver boost to housing market: CommSec

<a href="https://www.apartments.com.au/developments/broadbeach-qld-4218">Broadbeach</a> offers plenty of reasons to live vertically, but moving from a substantial family home into an apartment can expose the compromises of high-density living. Privacy, room for guests and usable living space tend to matter more when an apartment is intended as a permanent home rather than an occasional coastal base.

A typical residential floor at <a href="https://www.apartments.com.au/new-apartments/the-eveleigh-broadbeach-7-9-surf-parade-broadbeach-qld-4218">The Eveleigh</a>, on Surf Parade,&nbsp;contains just four apartments. The 94-residence development by <a href="https://www.apartments.com.au/developers/hirsch-faigen">Hirsch &amp; Faigen</a> is predominantly made up of expansive three-bedroom homes, with a limited collection of half-floor penthouses above.

Across the apartment floors, <a href="https://www.apartments.com.au/architects/rothelowman">Rothelowman</a> has used the relatively limited number of residences to give each home greater access to natural light and outlook. Living spaces extend towards full-height glazing, while a series of bay windows frame selected views across the Pacific Ocean, city and hinterland rather than treating the building edge as a continuous wall of glass.

&nbsp;

[smartcode_project:default project_id=149670 project_image_fid=360965]

“The apartment floors deliver a collection of homes that embrace controlled outlook via a series of bay windows deliberately framing moments of view,” Rothelowman Director Kim Lowman said.

From outside, those projecting forms contribute to the tower’s faceted profile. Strong horizontal and vertical elements establish its proportions, while the changing position of the sun alters the light, shadow and reflection across the façade throughout the day.

The same attention moves inside the apartments, where the material palette combines warm timber, natural stone, metallic detailing and softer curved forms. Kitchens sit within the main living zone, with stone island benches, integrated joinery and European appliances, before the living areas extend towards the glazing and the outlook.

&nbsp;

[smartcode_project:default project_id=149670 project_image_fid=360981]

Three genuine bedrooms provide room to accommodate family and guests, while two secure car spaces and storage address some of the practical considerations that can become more noticeable when moving from a larger home. Feedback from the display suite has centred on the warmth and restraint of the interiors, with buyers commenting that the residences feel like homes rather than conventional coastal apartments.

A limited collection of half-floor penthouses occupies the upper levels, increasing the scale of the living spaces and adding private balconies and elevated finishes. From this position, the outlook extends between the ocean and hinterland.

Outside the private residences, The Eveleigh separates its shared spaces between the podium and rooftop. The podium is centred on wellness, with subtropical landscaping surrounding a swimming pool and pool terrace, yoga garden, private gymnasium, sauna and hot and cold plunge facilities. Landscaped retreats and pavilions provide additional places to sit away from the main recreation areas.

&nbsp;

[smartcode_project:default project_id=149670 project_image_fid=360966]

Higher in the building, a rooftop pavilion and private dining suite sit alongside resident lounge, barbecue and outdoor dining areas, opening towards panoramic views across the ocean, city and hinterland.

“Buyers are no longer just looking for an apartment, but a lifestyle where they can relax, reset, and enjoy a balanced way of living,” Hirsch &amp; Faigen Director of Sales Matt George said.

Interest to date has come from established owner-occupiers and interstate lifestyle purchasers, including buyers planning a future move to the Gold Coast. Many are coming from larger homes and want to reduce ongoing maintenance without giving up space for family and guests, privacy, two car spaces or the ability to entertain at home.

&nbsp;

[smartcode_project:default project_id=149670 project_image_fid=360969]

Much of that daily life can also take place beyond the building without requiring a drive. Kurrawa Beach and Pratten Park are an easy walk from Surf Parade, while Pacific Fair, Oracle Boulevard, The Oasis, restaurants, cafés, entertainment and public transport are also within walking distance.

The Eveleigh is Hirsch &amp; Faigen's fourth Gold Coast development since entering the market in 2021, following The Hemingway at Palm Beach, The Emerson at Kirra and Yves at Mermaid Beach. Each of the preceding projects sold out before completion.

“Broadbeach had been on our radar throughout our time operating on the Gold Coast,” the developer said. “Following our projects in Palm Beach, Kirra and Mermaid Beach, Broadbeach represented the natural next step for the business.”

The Surf Parade site brought together proximity to the beach, protected coastal outlooks and walkability to dining, shopping and recreation. Hirsch &amp; Faigen also identified the street as an emerging premium residential address, with enough separation from Broadbeach's busier destinations to retain a quieter environment at home.

The Eveleigh is now under construction by Maxcon, with completion forecast for mid-2028. Three-bedroom residences are currently available from $2.87 million.

[smartcode_project_cta:default project_id=149670]

Joel Robinson

The Eveleigh brings house-like apartments to Broadbeach

A long-stalled Campbelltown development site is back in play, with new plans for 139 apartments set to supersede a mixed-use scheme approved almost a decade ago but never built.

The new proposal for 28 Cordeaux Street would deliver 116 market and 23 affordable apartments in a part 14-storey building, bringing a substantial new project into a Campbelltown market where new apartment supply remains limited.

Plans have been filed over the 3,092 sqm corner site at Moore-Oxley Street, around 600 metres from Campbelltown Railway Station and the city-centre retail core.

The site already carries a mixed-use residential approval dating to 2016. Doroch Architects has now been engaged on a larger replacement scheme, which is progressing as a State Significant Development Application following a Housing Delivery Authority determination in August 2025.

The apartment mix comprises 39 one-bedroom, 72 two-bedroom and 28 three-bedroom residences. Two-bedroom apartments make up just over half of the project, while three-bedroom homes account for 20 per cent.

<img alt="First look: New 139-apartment plans revive long-stalled Campbelltown city centre site" data-entity-type="file" data-entity-uuid="136dd5b9-3791-4da6-9e31-76f533f5b4de" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Campbelltown%20da2.png?VersionId=LgOSy9nwf5u.MGswBBwaGGxuX8QpHSl_" />

Of the 139 apartments, 23 will be delivered as affordable housing under the in-fill affordable housing provisions of the Housing SEPP. The affordable component represents 15 per cent of the residential gross floor area and will be managed by a registered Community Housing Provider.

Doroch has sought to break the scale of the building into two distinct elements, with a masonry podium of around four storeys establishing the street edge before the residential tower steps back above.

The corner position has shaped that approach. Cordeaux Street faces toward the commercial and civic centre, while Moore-Oxley Street leads into the lower-scale residential neighbourhood to the south, and the design verification report describes the site as "bridging the commercial core to the north and established residential areas to the south."

The podium will be expressed predominantly in face brick, while the upper levels shift to brushed and grooved concrete cladding with darker metal detailing. Recessed sections, deep balcony edges and landscaping break down the upper form, with an approximately 11.8-metre setback to the northern boundary addressing the adjoining St Peters Anglican School.

<img alt="First look: New 139-apartment plans revive long-stalled Campbelltown city centre site" data-entity-type="file" data-entity-uuid="c8b3d2d3-c561-4bfc-a5d9-a68c0c10dac1" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Campbelltown%20da1.png?VersionId=AeAEyJU02Gk2k5noUj2StziCvdQ7fW4B" />

Campbelltown has been starved of new residential developments in the last decade.

The only other notable development set to come to market this year is ALAND's Queen Square, a mixed-use precinct on over two hectares that will comprise apartments above a vibrant ground-level retail and hospitality dining precinct.

First look: New 139-apartment plans revive long-stalled Campbelltown city centre site

First Look: Sherlock Construction pitches apartments for low-rise Deception Bay

Queensland builder-developer MAYD has revealed the first look at its major North Kirra beachfront development, lodging amended plans that reduce the number of apartments and increase the proportion of larger residences.

The project is planned across a substantial 4,742 sqm amalgamated site spanning seven lots at <a href="https://www.apartments.com.au/new-apartments/2-6-pacific-parade-bilinga-qld-4225">2-6 Pacific Parade</a> and 27-33 Golden Four Drive in Bilin​ga, directly opposite Nor​th Kirra Beach.

<a href="https://www.apartments.com.au/developers/mayd-group">MAYD</a> secured the site for $32.5 million in 2025, in what was one of the Gold Coast's largest property transactions of the year.

The development will be delivered across two stages, with the first stage carrying an estimated gross realisation value of around $360 million.

The latest amendments seek to reduce the overall apartment count and shift the project further toward the owner-occupier market, with larger residences designed for buyers wanting considerably more space than traditionally offered in a beachfront apartment.

The residential mix will include townhomes, oversized two-bedroom apartments, substantial three-bedroom residences and four-bedroom homes.

MAYD has appointed Cera Stribley to lead the architecture and interiors, with the Melbourne-based design practice drawing on the beachfront setting through a series of ocean-facing terraces and heavily landscaped balconies.

Strong horizontal forms and curved balconies will define the exterior, with subtropical landscaping integrated throughout the building to soften the built form and increase the connection between the residences and the beachfront.

The project will also include an extensive collection of resident wellness and lifestyle facilities, continuing the broader shift across the Gold Coast's luxury apartment market toward larger homes supported by resort-style amenity.

<img alt="MAYD" data-entity-type="file" data-entity-uuid="d1bcbb05-e659-4b47-8bd4-1e595315e2ad" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-27%20at%202.05.03%E2%80%AFPM.png?VersionId=jj0XEud1X1DuLt7_KyElhjMdZGOXmLHP" />

MAYD Founder Todd Mould said North Kirra was increasingly appealing to buyers attracted to the more established, lower-density character of the southern Gold Coast.

"North Kirra presents one of the most compelling luxury residential opportunities currently emerging in Australia, combining absolute beachfront with the character and authenticity that buyers are increasingly seeking, and the same sense of tight-knit community that defined Burleigh and Currumbin perhaps 10 or 15 years ago," Mould said.

"With Gold Coast Airport on its doorstep, it also offers a level of accessibility that broadens its appeal across almost every market demographic."

The project comes as the southern Gold Coast continues to attract an increasing share of high-end apartment development and buyer activity.

Kirra in particular has emerged as one of the region's more tightly held beachfront markets, with its relatively low-density character, established surf and hospitality scene and proximity to Gold Coast Airport differentiating it from the higher-density markets further north.

Mould said those characteristics had informed the approach MAYD and Cera Stribley had taken to the project.

"We've worked closely with Cera Stribley to create a vision that is deeply connected to its surroundings," he said.

"Inspired by the coastline itself, the architecture has been shaped around space, privacy and resort-style living, creating a collection of homes that reflects the next generation of luxury on the southern Gold Coast."

MOTIV Managing Director Carly Cottam, who has been appointed to market the project, said buyer attention had continued to move south along the Gold Coast.

"Purchasers who may once have defaulted to Broadbeach, Main Beach or Surfers Paradise are increasingly recognising the value of a genuine beachfront location that offers lower density, strong amenity and a more established sense of community," Cottam said.

"Kirra has a powerful combination of growing demand and genuine scarcity. Beachfront supply is inherently constrained, the area remains relatively low density, and buyers are increasingly placing a premium on locations that feel established, uncrowded and authentic rather than heavily developed."

Cottam said the proximity to Gold Coast Airport was also proving increasingly important for interstate and second-home buyers.

"Being minutes from Gold Coast Airport makes it particularly compelling for interstate buyers, frequent travellers and second-home purchasers who can access an authentic coastal lifestyle almost immediately after stepping off a flight."

The acquisition takes MAYD's active development portfolio to more than $500 million, with the North Kirra project representing one of its largest undertakings to date.

MAYD is targeting an early 2027 launch.

First look at MAYD's North Kirra mixed-use precinct

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Castle Hill, the longtime hub of the Hills District, has been one of the major beneficiaries of Sydney's Metro expansion, with improved connectivity helping drive continued population growth, development and buyer demand across the Hills District.

But despite that growth, the suburb has seen relatively few major new apartment projects brought to market over the past 18 months.

Hills District developer Reve Group is looking to fill that gap with <a href="https://www.apartments.com.au/new-apartments/nova-r-ve-castle-hill-2-garthowen-crescent-castle-hill-nsw-2154">Nova Rêve</a>, a major new mixed-use precinct on the corner of Garthowen Crescent and Old Castle Hill Road, a short walk from Castle Hill Metro Station and Castle Towers.

[smartcode_project:default project_id=152737 project_image_fid=377679]

The project will comprise three residential towers alongside a hotel, restaurants, cafes and a skybar, more than 1,600 sqm of ground-floor retail and almost an acre of landscaped gardens.

It represents the largest project undertaken by Reve Group, the development arm of the Kassis family, which has been building across the Hills District for more than 30 years through Kassis Homes.

[smartcode_project:default project_id=152737 project_image_fid=377675]

Nova Rêve also represents a significant step up from the family's first apartment development, Grand Rêve, which was delivered nearby on Garthowen Crescent.

Grand Rêve introduced larger, house-like apartment layouts and premium inclusions including Wolf and Sub-Zero appliances to the Castle Hill market.

Nova Rêve takes that approach to a precinct scale, combining the residential component with hospitality, retail and substantial public and resident landscaping.

[smartcode_project:default project_id=152737 project_image_fid=377685]

Reve Group Managing Director Sam Kassis said the project reflected the family's three decades of building in the Hills, which has evolved from trophy homes on quarter-acre blocks to larger-scale apartment development.

"Grand Rêve was our first apartment project here and it showed us what this pocket of Castle Hill could be. Nova Rêve is the refinement of that idea: not just apartments, but a place the whole suburb can use," Kassis said.

A key part of that approach is the hotel, which has been designed to operate as an amenity for the wider Castle Hill community rather than solely hotel guests.

It will include restaurants, cafes, skybars and all-day dining, alongside conference and event facilities catering to business functions, community groups and private events.

At ground level, more than 1,600 sqm of shops and cafes will open onto the surrounding streets and landscaped areas.

Almost an acre of gardens designed by Land and Form Studios will run through the precinct, incorporating pathways, seating, barbecue areas and children's play spaces.

[smartcode_project:default project_id=152737 project_image_fid=377680]

Reve Group's Romio Georges said creating an active ground plane had been central to the planning of Nova Rêve.

"There are gardens with pathways, barbecues, seating and play areas, shops and cafes opening onto the street, and a hotel with restaurants and a skybar that anyone in Castle Hill can walk into," Georges said.

The project's elevated position on one of Sydney's highest ridgelines will also provide apartments with outlooks toward the Sydney skyline, surrounding parkland and the Blue Mountains.

More than 80 per cent of the apartments will occupy corner positions, with Turner responsible for both the architecture and interiors.

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Larry Schlesinger

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