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Bank of Queensland (BOQ) has posted the first full financial year Australian bank loss in 20 years, in part, due to its exposure to the declining south-east Queensland commercial property market as well as from operating in a tougher overall credit environment.
It reported a full-year loss of $17.1 million, compared with a net profit of $158.7 million in the previous 12 months.
It reported a 100% increase in its loan impairment expense of $401.0 million, compared with a prior year expense of $200.5 million.
“The increase in impaired assets is a result of a thorough independent review of the bank’s commercial loan portfolio and the continued decline in commercial property prices in Queensland in the first half,” reported the bank in its full-year accounts.
The bank’s $5.1 billion business and agricultural loan book is now in run off “due to impaired property asset realisations”.
BOQ chief executive Stuart Grimshaw, who took on the role in November, said today the bank was seeing stabilisation in the commercial portfolio, with “no new large impaired exposures” in the second half of the year.
The last Australian bank to report a full-year loss was ANZ, which made a $579 million loss two decades ago.
BOQ was profitable in the second half of the year and expects to return to profitability in the current financial year.
Commenting on the results, Grimshaw said the bank continued to operate in a low credit growth environment but was seeing signs of consumers returning to the housing market.
“Consumers are behaving cautiously and paying down their debt. More than 40% of Australian mortgage holders are at least one year ahead of schedule on their repayments.
“Household savings are at levels not seen since the late 80’s, despite falling interest rates.
“We are starting to see some early signs of consumers returning to the housing market, evidenced by auction clearance rates in capital cities improving,” he said.
“Stronger credit and collection processes are now in place and our risk management capability is vastly improved."
BOQ does 60% of its lending in Queensland with 16% in Victoria, 13% in NSW and 8% in WA.
It will look to tap into the bullish WA property market with an increased retail presence and use of mortgage brokers.
The bank expects the WA economy to continue to exhibit strong GDP growth and believes there is “significant opportunity to improve its market share using a multi?channel approach".
BOQ quit the mortgage broker market in 2004 to focus on its owner-managed franchised branches, but has recently returned to using brokers selectively to expand its footprint outside of Queensland.
The bank grew its home loan book by 5.1% over the financial year from $24.15 billion to $25.36 billion and also reported a decrease in the proportion of borrowers more than three months behind on their mortgage repayments from  0.93% in the first half of the year to 0.7% in the second half.
However, it also reported a tightening of net interest margins from 2.01% to 1.98% as well as increasing reliance on more retail deposits  (rising from 56% to 59% of funding). 
The improvement in arrears performance is across all states.
Despite the loss, the BOQ board approved a fully franked final dividend of 26¢ per share, taking the full year dividend to 52¢ per share.
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Exposure to SE Queensland commercial property market causes Bank of Queensland's first bank loss in 20 years

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The Port of Melbourne, Gladstone Port, Port Hedland Port, Darwin Port, the Great Barrier Reef Airport as well as numerous electricity and water infrastructure are among around $220 billion worth of assets state governments might consider selling to shore up its finances.
The sell-off is recommended in a new federal report called Australia's Public Infrastructure – Part of the Answer to Removing Infrastructure Deficit released today by Infrastructure Australia.
It lists what it calls “commercially viable, publicly owned assets” that could be sold to the private sector.
Infrastructure Australia says it has identified that more than $100 billion of commercial infrastructure assets on Australian government balance sheets including airports; roads; water services; ports; freight rail; and electricity generation, transmission and distribution with an “enterprise value range” of between $195 billion and $219 billion.
The most valuable assets are tied to electricity production, with the report listing up to $59 billion worth of “electricity distribution” assets and $48 billion in electricity generation and transmission assets.
Around $11 billion could be generated from the sale of ports and less than $1 billion from airport sales.
Assets that could be sold to private interests include Snowy Hydro; the three NSW energy distributors Ausgrid, Essential Energy and Endeavour Energy; water retailer Sydney Water; and ports in Newcastle, Gladstone, in Western Australia and Tasmania.
“Today, the costs to governments of operating and maintaining these assets often far outweigh the benefits to the community of retaining these assets in government ownership,” says national infrastructure coordinator Michael Deegan.
He says governments around Australia need to explore new methods of financing and developing the infrastructure needed to improve national productivity.
“If we are to build on and sustain the living standards of all Australians, governments need to recognise that they cannot bridge the current funding gap,” he says.
 
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According to the report, many assets in the energy, ports, regional airports and freight rail sectors could be sold relatively quickly and under current policy settings. The report adds that these sectors have the most capacity to provide funding for new economic infrastructure.
The assets are likely to be targeted at super funds because of their steady yields, rather than offshore institutions and sovereign funds, following the recent political stoush over the sale of <a href="https://www.propertyobserver.com.au/rural/cubbie-station-officially-sold/2012101257136" target="_blank">Cubbie Station,</a> with the report acknowledging that "some members of the community have genuine concerns about the private sector owning or controlling infrastructure that has long been in public hands.
“Australia's superannuation industry is also well placed to purchase these assets - providing a real opportunity to achieve all the potential benefits of a sale while maintaining ownership of these assets across a broad cross-section of the community,” says Infrastructure Australia.
The sale of the assets would be used by the governments to fund highways, ports and other infrastructure projects, as taking on fresh debt to do so could put its Moody’s triple-A credit rating at further risk, following recent falls in commodity prices.
Recent successful asset sales that Infrastructure Australia says “have generated real community value include the recent refinancing of the Sydney Desalination Plant, which raised $2.3 billion, $300 million more than the cost of constructing the plant.
“After repaying the debt incurred in building the plant, the net proceeds from the refinancing have been provided to Restart NSW allowing government to fund the building of critical new infrastructure such as roads, hospitals and schools.”
Other successful sales listed in the report include Hobart Airport, which was sold to a consortium of Macquarie Bank and the Tasmanian Retirement Benefits Fund for $350.5 million.
“Press reports suggest the price was above expectations.  The high sale price was reportedly due in part to the potential of the large parcel of 570 hectares of land attached to the airport,” says the report.
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Federal report suggests $220 billion sell-off of ports, airports and infrastructure assets to fund future projects

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The Australian housing market is set to crash like the US housing market crashed following the sub-prime mortgage crisis, US property market doomsayer Jordan Wirsz has claimed in a new blog post. Wirsz caused a stir in the Australian media earlier this year when he forecast Australian house prices to fall 60% over the next five years. Despite being unknown in Australia and with no evidence to back his claims, they were reported on News Limited websites as a warning of a “bloodbath” to hit the Australian property market. Little has been heard from Wirsz since then until his latest blog post, which claims that while that there are “very bullish signs” for the US housing market, the Australia’s property market is heading for a tumble. “I’ve done a lot of research on the Australia real estate market, and in fact see some very significant signs that they are almost exactly where the U.S. market was in 2008… Who knew it could fall so much… Well, I think Australia is in for it in a big way. Stay tuned for more on that topic later. In the meantime, happy real estate hunting,” <a href="https://blog.jordanwirsz.com/why-i-think-the-time-is-now/" target="_blank">writes Wirsz on his blog.</a>
But property investment adviser Margaret Lomas, who has read Wirz's latest blog and sparred with him in the past on Sky News, says she is finding "much more encouraging news [about the Australian housing market] from some fairly reliable sources".
"The September quarter showed some slow, albeit low, growth in many markets, as we carefully creep along, prudently buying, bargaining hard but keeping property values just about where they should be given the world economic outlook.
Lomas suggests listening to the "true experts" like Tim Lawless from RP Data, who "forecasts rising housing prices for the major urban areas of Australia" with the quarterly rate of house price growth over the September quarter forecast to be around 2% – "that's the strongest quarterly change since May 2010".
Wirsz suggests now is the time to buy US real estate and says that US housing investors are “living and dying with every new release of the home-builder data, home price indexes, and all the nonsense that is available to the average person” and should instead take a leaf out of Warren Buffett’s book and watch very little of the news, “if any”.
 
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According to the September Case-Shiller index of 10 major US metropolitan areas and its 20-city index, properties prices rose 1.5% and 1.6% respectively, supporting a fractured recovery in the US housing market. However, some of the states worst-hit by the sub-prime mortgage crisis, such as Cleveland, have only just moved past January 2000 prices. In a Reuters September poll, 35 of 38 economists said the US market was recovering, but the pace of recovery is still painfully slow. US house prices crashed about 35% in the wake of sub-prime mortgage crisis, but falls were greater in California and in south-west mortgage belts like Nevada. According to a Home Builders Research report from June, the median resale price of  home in Las Vegas, Wirsz's home town, was just $120,000 in June, though up 9.1% from a year ago. The average price of a house in Las Vegas was around $350,000 in 2007, according to the National Association of Realtors. Wirsz claims to have achieved over $500 million in sales and advised Fortune 500 CEOs about real estate investments. He describes himself as a “licensed realtor, entrepreneur and businessman based in Las Vegas, Nevada”. “By the age of 25 Jordan founded a private capital lending firm which grew to a size of approximately $150 million under management. The firm financed the developers and construction companies in the booming Las Vegas real estate market,” says his website. 


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Margaret Lomas dismisses US doomster Jordan Wirsz's fresh claim of Australian impending property market crash

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The odds are fairly long on getting a better mortgage deal by taking out a fixed-rate home loans, real estate group First National has tweeted today, quoting an “undisclosed banking source”.
The real estate network's official news channel tweeted:
<a href="https://twitter.com/RealEstateCast" target="_blank"><img src="/images/stories/2012/10/fntweet.jpg"></a>
It comes as banks continue to cut their fixed-rate home loans to entice borrowers to fix their home loan.
Fixed-rate borrowers are better off if interest rates rise over the term of their loan but can be worse if rates fall over the term of their loan.
The federal government ban on exit fees does not apply to fixed-rate home loans.
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Fixed-rate borrowers seldom beat the bank: Tweet of the day

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Creditors of failed mortgage fund manager and non-bank lender Provident Capital have been recommended to vote in favour of winding up the business following the rejection of a bid by former Provident boss Michael O’Sullivan and fellow executive Michael Bersten to regain control of the business.
A meeting of creditors is scheduled to be held on October 24 in Sydney.
Australian Executor Trustees Limited (AETL), which represents Provident Capital debenture holders, rejected a recommendation from O’Sullivan and Bersten that they resume control of Provident under a deed of company arrangement (DOCA), according to a circular to creditors issued by joint administrators Joseph Hayes and Tony McGrath from McGrath Nicol.
Hayes and McGrath represent unsecured creditors of Provident Capital, who are owed around $1.1 million and were appointed by AETL on September 18. These include $430,000 owing in employee entitlements.
“Michael O’Sullivan and Michael Bersten (two of PCL’s directors) have proposed a DOCA for the company,” report Hayes and McGrath in their October 17 circular to creditors.
“The DOCA essentially involves the transfer of debenture holder interests (and the debenture holder loan book) into the high-yield fund (HYF), the retirement of the receivers [PPB Advisory, which represents secured creditors], and the resumption of control of the company’s operations by the directors.”
The administrators note that based on preliminary investigations, they are "unable to form a clear view as to whether the proposed DOCA will generate a superior return for creditors than a liquidation".
They do note though that their preliminary investigations “indicate that there are a number of matters that raise concerns”.
“In order for the DOCA to be implemented, the trustee (in its capacity as secured creditor) is required to vote in favour of it.
“On 12 October 2012, we were advised by the trustee’s lawyers that the trustee does not support the DOCA and will be voting for the company to be wound up at the second meeting of creditors.
“Given the trustee’s position, the DOCA is incapable of implementation and, as the company is insolvent, there are no options other than to place the company into liquidation.
“Our recommendation is that creditors vote for the company to be wound up.”
Receivers and managers at PPB Advisory continue to have “control of the company’s business, assets and loans” and represent the interests of debenture holders.
In August, PPB Advisory told debenture holders it was hopeful of restarting the flow of payments before the end of the year, but that they should not expect a full refund of their investments.
Secured creditors are owed in excess of $200 million.
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Provident Capital likely to be wound up at October 24 meeting of creditors

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The home of one of Melbourne’s oldest butchers will be auctioned on October 26, the first time the premises will be up for sale in 100 years and a rare opportunity for investor to acquire a retail holding on Carlton's Lygon Street retail strip.
Donati’s Fine Meats at 402 Lygon Street in Carlton (pictured bel0w) has pre-auction expectations in excess of $1.5 million and is only the second retail property up for sale in two years on Lygon Street.
<img src="/images/stories/2012/10/donatis.jpg">
The last commercial building to sell on Lygon Street was the 117-square-metre premises of Intrepid Travel at 231 Lygon Street, which sold in July last year for $1.9 million at a yield of around 3.7%.
The shop at 403 Lygon Street has been run as a butchery since the early 1900s. From its inception until 1954 it was run by the great-grandparents of the current business owner, Leo Donati. In 1954 Davide Baccini in partnership with Modesto Bertocchi (who later created Bertocchi Smallgoods) took over the shop, calling it Extra Meat Supply.
This ran until 1972, when Leo Donati took over the premises and changed its name to Donati’s Fine Meats.
Donati’s celebrates its 40th anniversary this year and is famous for its ox-tails, lamb shanks, veal-and-pork meat loaf and rabbits.
Opera-loving owner Leo Donati has recently signed a new five-year lease, with the shop currently returning a net rental return of $66,656 per annum.
A price of $1.5 million would deliver investors a yield of around 4.5%.
The 76-square-metre property is being marketed by Colliers International agents Jeremy Gruzewski and Tom Noonan.
“The term ‘rare opportunity’ is used quite regularly in our line of business, but the incredibly tightly held nature of this Lygon Street precinct makes this just about as rare an opportunity as you can get in this market,” he says.
“In the last two years, there has only been one commercial property sale on Lygon Street. This is an exciting opportunity to be part of a vibrant, popular area that doesn’t come along often.
Gruzewski says the property is in a high-profile location with excellent exposure to passing foot and vehicle traffic.
“This is an opportunity for a purchaser to secure a solid investment with rental upside and a long standing tenant who is keen to stay where they are,” he says.
The property is located on the eastern side of Lygon Street, between Faraday and Elgin streets, approximately two kilometres north of the Melbourne CBD.
The building itself comprises a two-level brick retail building with the ground floor featuring a fully fitted and renovated butcher shop with cool room, storage area and rear access.
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Historic Lygon Street, Carlton, butcher seeking new buyer with juicy $1.5 million-plus hopes

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Conditions remained tough for residential home builders in the June quarter, according to the latest ABS data.
New house commencements fell 0.6%, to $5.63 billion, and new other residential building (apartments) rose 22.1% to $3.37 billion with total residential building work declining for the fifth consecutive quarter by 3.1% compared with the 2.5% decline originally reported in August.
Alterations and additions fell 3.9% to $1.64 billion.
Non-residential work commenced fell 22.1%, to $6.76 billion.
Of the major state housing markets, WA recorded the biggest decline in new residential building work done of 13.2% followed by South Australia (-5.7%), Victoria (-5%) and NSW (-3.4%).
The value of residential work done in Queensland rose 7.4% to $1.8 billion.
In aggregate, commencements of new residential buildings rose 6.8% to $9 billion while total new building starts (residential and non-residential) fell 7.5% to $17.4 billion following rise of 4.1% in March 2012.
A pick-up in new residential building activity in NSW and Queensland is anticipated following the doubling of state grants for first-home buyers buying a new property.
The Housing Industry Association (HIA) said the ABS figures show that  in mid 2012 residential construction activity was even weaker than first reported.
HIA chief economist, Harley Dale, said that a fifth consectutive decline in residential building work done in the June 2012 quarter was steeper than initially thought and confirmed an ten year low for new home building activity.
“Interest rate cuts are helpful in hopefully turning around residential construction from the parlous state evident in mid 2012. However, the efficacy of easier monetary policy is considerably diluted by the historically high and excessive margin between the official cash rate on the one hand and mortgage and business loan rates on the other,” said Harley Dale. “Federal and state governments need to view today’s update on Australia’s residential construction industry as a signal they are failing to adequately invest in and reform new housing supply.
“Today’s update makes a mockery of recent scuttlebutt suggesting negative gearing arrangements need to be diluted or removed," says Dale.
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New home building flat in June quarter: ABS

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Stockland shareholders have been warned that profits will fall further in the next financial year with the Victorian residential market the standout weak spot.
Delivering his final address as managing director before he steps down in February, Matthew Quinn provided an update on residential deposits taken over the first quarter of the 2013 financial year.
Over the three months to September, net deposits taken declined from 1,127 to 1,082, with deposits on Victorian residential developments declining from 289 in the final quarter of the 2012 financial year to just 161 in the first quarter of the 2012-2013 financial year.
A smaller decline in deposits was recorded in NSW (170 to 142), with an improvement noted for Queensland (deposits up from 334 to 386) and Western Australia (334 to 393).
“Our residential business faces a high degree of uncertainty given current buyer caution,” Quinn told shareholders in Sydney today.
“There have been some signs of improvement in the housing market, particularly in Perth and we have recently been bolstered by first-home buyer stimulus targeted at the new housing market in Queensland and NSW.
“The reality, though, is that conditions are very tough in Victoria where the company’s most profitable projects are located.”
Stockland has eight residential community projects on the Melbourne fringes, including Highlands in Craigieburn and Selandra Rise in Clyde North.
Quinn reminded shareholders that at Stockland’s full-year results presentation in August, he said Australia was experiencing “the worst new housing market I had seen in more than 20 years in the industry”.
“This is not only because sales are at a cyclical low, but because this has persisted despite conditions that would normally stimulate activity – low unemployment, low interest rates, undersupply of housing and low rental vacancy rate.”
Quinn says that in every state where Stockland operates housing approvals are tracking well below the long-term average, and nationally the market is 18% below historical averages.
“Housing approvals is a lag indicator and these figures don’t yet reflect the recent downturn in Victoria which we expect to show through sharply in coming months.
“The good news is that population growth remains strong and this cycle will turn, but the question is ‘when’.
“We need to see a trigger for improvement – a sense that the market is moving, so cautious consumers become more concerned about acting too late than acting too soon.
“Interest rates are normally a driver of this, but in this cycle home owners are just paying off their mortgages more quickly rather than taking on more debt. In the long term this is a good thing, but it’s painful while we go through this process.”
 
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Quinn also reminded shareholders that while there is always a big focus on Stockland’s residential business, the majority of its assets are “investment properties where the profits are very predictable from secure, rental backed contracts”.
He said Stockland’s $5 billion shopping centre portfolio continued to perform well in the challenging environment and is expected to achieve 2% to 3% comparable net income growth in the 2013 financial year.
However, overall profit from Stockland's commercial property investments will be lower than last year. 
In addition, while Stockland’s retirement living business continues to see strong demand for products, "settlements are being impacted by the soft residential market conditions, particularly in Victoria".
In his address to shareholders, Stockland chairman Graham Bradley said a “combination of factors including low consumer and business confidence, anxiety about global economic conditions and fear of unemployment” have combined to produce headwinds, which have impacted on Stockland’s profit performance in the 2011-12 financial year. He said these headwinds “will continue to do so in the current 2013 financial year when, I regret to report, we expect our profit to decline further”.
Stockland profits fell 7% to $676 million in the 2012 financial year, with profit from its residential business falling 15%.
Bradley said the Stockland board is confident of delivering improved returns from the 2014 financial year, “as our three major retail developments come on line and as we launch new residential projects”.
He also thanked Quinn and said Stockland had grown significantly under Quinn’s leadership, who also steered the company through the 2008 financial crisis.
Bradley said the search for Stockland’s next managing director was progressing well.
“We look forward to announcing the appointment of our new managing director in due course.
“In terms of day to day operations, we are pleased to have a strong management team in place who will ensure that our business maintains momentum and achieves a smooth leadership transition.”
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Stockland expects further slide in profits in 2012-13 in ‘very tough’ Victorian residential market

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First-home buyers who bought their first homes at the top of the last housing market cycle in 2009, when state government grants were most generous, are now struggling to refinance their loans due to weak equity positions,  according latest Australian Mortgage Industry report prepared by JP Morgan and Digital Finance Analytics.
As interest rates fall and households continue to deleverage, the report says that around 30% of first-time buyers are seeking to refinance their loans, which is "twice the amount, if not more, than other borrowers".
“Secondly, and more worryingly, of those that apply, 15% are being declined – substantially above other categories of borrowers, who are all well below 5%.
“First time buyers bought at the ‘top of the cycle’, with insufficient time between 2009 and now to generate equity in their home, particularly in light of declining house prices relative to the 2009 peak.”
“The end result is that first time buyers not only have a higher proportion of existing loans looking to refinance, but also have a higher proportion of those re-financing applications rejected," says the report.
Click to enlarge
<a title="Click to enlarge" rel="shadowbox" href="/images/stories/2012/10/jpm.gif"><img src="/images/stories/2012/10/jpmthumb.gif"></a>
Many of these buyers took advantage of boosted first-home buyer grants (which tripled to $21,000 for those buying new homes) introduced in the wake of the GFC, which the report says “buoyed housing prices throughout 2009”.


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They also bought with small deposits, with the report highlighting that the proportion of first-h0me buyers who bought with loan-to-value (LVR) ratios of more than 90% was higher than the average for other owner-occupiers groups.
In the interim banks have lifted LVR requirements in line with tougher global banking rules, and first-home buyers have been caught out.
According to JP Morgan, the two main reasons why loan applications are rejected now are an inadequate LVR (34% of rejected applications) or insufficient income (34%).
Over late 2008 and early 2009 the report says there was a surge in the volume of first-time buyers in the six months between the announcement of incentives in November 2008 and the reduction of first-time buyer LVRs by banks in April 2009.
“This simply pulled forward demand and left a substantial equivalent hole over the following year." 
The report also forecasts the current slow pace of mortgage growth to continue, noting that “growth in the average value of each form of owner-occupied approval is now in negative territory” – the first time this has occurred since data became available in the early 1990s.
The report says not only are the volume of approvals weak, but the average value of approvals is declining.
“While this may simplistically be dismissed as a broader indication of stalled house prices, we conclude that a degree of tightness for refinancings is evident – particularly for first-time buyers.
"Housing credit growth has continued to soften since breaking below double-digit growth rates in mid-2008. In fact, the most recent three-month annualised growth rate of 3.6% for housing credit in August 2012 is the lowest level since the RBA started disclosing credit aggregates in 1976.
"Given the current outlook, we expect low rates of credit growth to continue –with risk to the downside – as opposed to watching out for a quick rebound off the back of lower interest rates."
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Some 2009 first-home buyers struggling to refinance mortgages due to declining values: JP Morgan

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Perth house prices are expected to grow by a cumulative 20.4% over the next three years to 2015, according to the latest QBE LMI Housing Outlook report prepared by BIS Shrapnel.
The report anticipates the median Perth house price to rise from $505,000 to $580,000 over the next three years, with strong growth also expected for Brisbane (from $450,000 to $515,000) and Sydney ($660,000 to $750,000).
Sydney house price growth is expected to be modest in 2013, at just 2.7%, but is forecast to pick up in 2014 and 2015.
Darwin house prices are also expected to continue to surge rising to a median of $650,000 – making it the second most expensive housing market after Sydney.
Melbourne house prices will continue to tread water over the next three years, rising by less than 2% annually to 2015, with median house price increasing from $540,000 to $557,000, according to the report.
Modest house price growth is also anticipated for Adelaide, Canberra and Hobart.
 Median house price growth forecasts 2013 – 2015 (major capitals) 
<table style="width: 470px;" border="1" cellspacing="0" cellpadding="0"><tbody>
<tr>
<td valign="top" width="60">
 
</td>
<td valign="top" width="79">
Perth
</td>
<td valign="top" width="76">
Brisbane
</td>
<td valign="top" width="76">
Sydney
</td>
<td valign="top" width="94">
Adelaide
</td>
<td valign="top" width="104">
Melbourne
</td>
</tr>
<tr>
<td valign="top" width="60">
2013
</td>
<td valign="top" width="79">
6.3%
</td>
<td valign="top" width="76">
3.9%
</td>
<td valign="top" width="76">
2.7%
</td>
<td valign="top" width="94">
1.3%
</td>
<td valign="top" width="104">
0.9%
</td>
</tr>
<tr>
<td valign="top" width="60">
2014
</td>
<td valign="top" width="79">
7.9%
</td>
<td valign="top" width="76">
7.8%
</td>
<td valign="top" width="76">
6.1%
</td>
<td valign="top" width="94">
2.5%
</td>
<td valign="top" width="104">
1.5%
</td>
</tr>
<tr>
<td valign="top" width="60">
2015
</td>
<td valign="top" width="79">
6.2%
</td>
<td valign="top" width="76">
6.2%
</td>
<td valign="top" width="76">
7.1%
</td>
<td valign="top" width="94">
2.4%
</td>
<td valign="top" width="104">
1.6%
</td>
</tr>
<tr>
<td valign="top" width="60">
2015 Median
</td>
<td valign="top" width="79">
$580,000
</td>
<td valign="top" width="76">
$515,000
</td>
<td valign="top" width="76">
$750,000
</td>
<td valign="top" width="94">
$580,000
</td>
<td valign="top" width="104">
$557,000
</td>
</tr>
</tbody></table>
Median house price growth forecasts 2013 – 2015 (minor capitals) 
<table border="1" cellspacing="0" cellpadding="0"><tbody>
<tr>
<td valign="top" width="64">
 
</td>
<td valign="top" width="76">
Darwin
</td>
<td valign="top" width="76">
Canberra
</td>
<td valign="top" width="76">
Hobart
</td>
</tr>
<tr>
<td valign="top" width="64">
2013
</td>
<td valign="top" width="76">
5.3%
</td>
<td valign="top" width="76">
-0.8%
</td>
<td valign="top" width="76">
-1.1%
</td>
</tr>
<tr>
<td valign="top" width="64">
2014
</td>
<td valign="top" width="76">
5%
</td>
<td valign="top" width="76">
0%
</td>
<td valign="top" width="76">
1.1%
</td>
</tr>
<tr>
<td valign="top" width="64">
2015
</td>
<td valign="top" width="76">
3.2%
</td>
<td valign="top" width="76">
1.4%
</td>
<td valign="top" width="76">
1.4%
</td>
</tr>
<tr>
<td valign="top" width="64">
2015 Median
</td>
<td valign="top" width="76">
$650,000
</td>
<td valign="top" width="76">
$498,000
</td>
<td valign="top" width="76">
$375,000
</td>
</tr>
</tbody></table>
Source: BIS Shrapnel

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The report says the residential market in Perth has stagnated after prices peaked in December 2007, with the median house price reaching $478,000 as a result of deteriorating housing affordability.
“Conditions in Perth are now beginning to turn around and point to a recovery.
“The combination of rising underlying demand and falling completions has seen a substantial deficiency emerge.
“This is being reflected in vacancy rates falling to 1.9% in June 2012, which is well below the balanced market rate of 3%, and underpinning stronger rental growth."
The report also notes that employment growth has also been strong, with the unemployment rate well below 5% while affordability has also improved significantly.”
In addition, “rising investment in new mining and resource projects will lead to further improvement in sentiment”.
The relatively strong outlook for Sydney is based on rental growth continuing to remain solid, “outpacing recent price growth, and driving an improvement in yields”.
“First-home buyer demand — albeit inconsistent due to changes in state government first home buyer incentives — appears to be improving, while the extended period of weak prices together with interest rate reductions over 2011-12 mean that affordability is now at its best level since 2001.
“Given this, the main factor holding back the Sydney market now appears to be confidence. With economic growth forecast to become more broad based outside the resource sector in 2012-13, this should help sentiment,” says the report.
However, in Melbourne “high level of new dwelling construction has coincided with slowing population growth and the market is estimated to have moved from close to balance at June 2011, to a rising underlying surplus of dwellings at June 2012”.
As a result rental vacancy rates have also begun to increase and are expected to continue to rise as most of the investor-purchased apartments work their way through to completion.
The report says there is little in the Melbourne market at the moment to drive demand or price growth, but major price declines are not expected.
Looking at the housing market as a whole, Jenny Boddington, chief executive of QBE LMI, says the affordability of housing is “currently at its best level across most capital cities since the first half of last decade, with the exception of a brief period in 2009 when affordability spiked due to aggressive cuts in interest rates”.
“Notably, affordability is expected to further improve as standard variable interest rates are tipped to fall by another 25 basis points in 2012-13.
“Consequently, we should see increased housing turnover in the market as first home buyer numbers pick up and have a positive effect on upgrader activity, which in turn is predicted to further spur investors return to the market.”
The report also says first-home buyer demand is now trending upwards following depressed activity since 2008-09.
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Perth to lead house price growth over next three years, with Sydney and Brisbane also strong: BIS Shrapnel and QBE

<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.

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“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.

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[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.

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[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.

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[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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