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The consensus among economists is for at least one more rate cut in 2012 following yesterday’s unsurprising decision by the RBA to leave the cash rate unchanged at 3.5%.
Post-decision analysis focused on RBA concerns about China and the global economy while also noting comments from RBA governor Glenn Stevens that in Australia, “most indicators available for this meeting suggest growth has been running close to trend” while mortgage rates remain encouraging for borrowers, running currently “a little below their medium-term averages”.
Westpac chief economist Bill Evans is tipping a 25-basis-point rate cut at the RBA's November board meeting, but also expects a further rate cut in December.
“Broadly speaking the assessment of the global economy appears to be more downbeat, while there is little evidence of any change in the view on the domestic economy,” says Evans.
Evans highlights that “the outlook for China is more uncertain and that the terms of trade have declined significantly”.
“We expect that accumulating evidence that the domestic economy is losing momentum; the labour market is genuinely weakening; financial conditions are tightening due to the divergent behaviour of the terms of trade and the Australian dollar; and the global growth environment remains uncertain will ensure that a convincing case for a further monetary ease is apparent by that November meeting.
“The bank is clearly keeping its options open despite the fact that we assess that it is markedly closer to a rate cut stance than it was a month ago. However, the evidence on the domestic economy will need to make a stronger case for a rate cut than has been the case over the last few months.”
Commonwealth Bank economist John Peters says the bank has retained its view of a 25-basis-point rate cut in the fourth quarter, with the main pressure for lower rates comes from global downside risks.
“If anything the RBA now sees the international growth outlook as a little more subdued as was the case a few months ago. Probably the most crucial line in the RBA’s statement accompanying today’s decision is some recent (international) indicators have been weaker, which has added to uncertainty about near-term growth,” says Peters.
Australian Financial Review economics editor Alan Mitchell says the big concern is the Australian dollar, which he says is not playing its role in cushioning the economy by falling with the terms of trade.
“A weaker dollar would be good for marginal mining projects and for the manufacturers and trade-exposed services,” Mitchell says.
“Currency experts are predicting that the dollar will adjust to the new and more sombre Chinese economic reality, but if it doesn’t, the Reserve Bank will have to weigh in with a reduction in the official cash rate.”
Fairfax columnist Malcolm Maiden says the RBA’s inclination to cut rates “has grown” since the last statement, with the focus on global growth being “no more than average pace” but with the added phrase that the outlook is “still on the downside”.
Maiden says RBA commentary on China’s growth has also become more cautious than a month ago.
He says the cash rate could be cut as early as October if local economic signals and overseas signals don’t improve.
HSBC Australia and New Zealand chief economist Paul Bloxham describes yesterday’s statement by governor Glenn Stevens as “more hawkish then expected” with “concerns about the 'death' of the mining boom were nowhere to be seen”.
“Having gotten rates down ahead of the recent weaker data from China and Europe, and the fall commodity prices, they clearly felt they have time on their side. Getting 'ahead of the game' early has this pay-off."
Bloxham adds that the statement also repeated an earlier mantra – heard at the RBA's recent parliamentary testimony – that is too early to judge the full impact of the rate cuts that have already been made.
Bloxham is tipping another 25-basis-point cut before year-end, but believes that the 100 basis points of easing priced in over the next year is overdone.
CommSec economist Savanth Sebastian says it is clear the RBA is happy to remain on the interest rate sidelines – “at least for the time being”.
"Policymakers seem comfortable with domestic economic conditions but continue to watch the global situation carefully. Europe, the US and Asia have slowed and the central bank seems particularly focused on the slowdown in China, given its importance to Australia’s growth profile."
He says the variable housing rate is applying modest stimulus to the economy, at present at 6.85% below the 15-year average of 7.20%.
ANZ economists Ivan Colhoun and Justin Fabo describe the decision as “widely expected”, with much of the governor’s statement “very similar to recent public pronouncements”.
“Overall, our views on the Australian policy outlook and economy are largely unchanged. “We continue to expect the RBA to end up changing its mind about interest rates, probably by November."
Colhoun and Fabo say the disappointing response of the sharemarket yesterday was likely a reaction that suggests the RBA “continues to read the economy in a slightly too optimistic way and evolve its view slower than the underlying economy”.
“The current trend to reduced resource investment (albeit more an issue for growth in 2014 and beyond) and the continuing downward trend for job advertising (the ANZ job ads series has now fallen for five months in a row) suggest at least one easing before the end of 2012 and further easing over 2013, perhaps more than our currently factored 50 basis points in total."
The next RBA board meeting is on October 2.
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lschlesinger-FZcF9M3vE6

At least one more RBA rate cut tipped by economists for the year, with focus on China and exchange rate

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Vendors appear hopeful of better fortunes this spring selling season with the total number of residential properties listed for sale online rising 1.5% over August to reach 373,510, according to figures from SQM Research.
This contrasts starkly with the same time last year, when listings fell 3.8% from 377,213 in July 2011 to 362,740 in August 2011.
Sydney and Melbourne both recorded “substantial” 5.9% increases in monthly residential properties listed for sale, to reach 31,310 and 51,194 listings respectively.
Click to enlarge
<a title="Click to enlarge" rel="shadowbox" href="/images/stories/2012/09/sqmsept5.gif"><img src="/images/stories/2012/09/sqmsept5thumb.gif"></a>
SQM Research managing director Louis Christopher described market conditions as a little better than this time last year, "but it doesn't mean we are going to head into a big property boom''.
"If rates stay on hold, that will be conducive to stimulating the housing market, and we are likely to see continued market recovery, but there are many X-factors at play,'' he told news.com.au.
Christopher says rising rents (up 7% annually over the past five years) are good news for investors, but they have been offset by declining house prices.
He expects there will be further seasonal rises in stock levels as the spring selling season enters full swing.
Click to enlarge
<a title="Click to enlarge" rel="shadowbox" href="/images/stories/2012/09/sqmsept51.gif"><img src="/images/stories/2012/09/sqmsept51thumb.gif"></a>
While residential stock on market in Sydney is just 0.9% higher than a year ago at 31,310, Melbourne has the highest year-on-year increase of all the mainland capital cities, with stock up 14.1% to 51,194 in August.
In August last year there were 44,859 properties listed for sale in Melbourne.
The other notable increase was Canberra, where stock on market increased by 8.8% over the month to 3,758 online listings. This is up 13.6% up on August 2011.
“Canberra’s large monthly increase may well signify a downturn for that market as federal budget spending is cut,” noted SQM research.
Bucking the monthly trend of rising stock levels was Perth, which recorded the largest monthly decline of 1.8% to 18,053. Residential listings were down 10.7% on the same time last year when there 20,207 listings.
Residential stock levels have declined in Perth, Darwin and Brisbane – which all benefit from Australia's mining boom
Darwin residential listings are down 23.3% over the 12 months to August to 1,282 while Brisbane listings are down 4.7% to 28,666.
“Increasingly the market is segmented. It is becoming difficult to discuss just one national housing market and in my opinion, that will be to base line story for the remainder of 2012,” said Louis Christopher, managing director of SQM Research.
While Hobart stock on market declined by 1.7% over August to 4,388 properties listed for sale, there are 24.1% more properties for sale than a year ago. At this time last year there were 3,536 listed for sale in Hobart.
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Online residential listings rise 1.5% in August to 373,510, led by Melbourne, Sydney and Canberra 

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<img src="/images/stories/2012/08/40k.gif">
The net gross face rent per annum that Bartfeld Textiles Pty Ltd will pay to lease a brand new 275-square-metre showroom at 343A Reserve Road, Cheltenham. The lease is for three years plus renewal options. The lease was negotiated by Sasan Misaghian from Colliers International. The lessor is Keasment Pty Ltd. The showroom is part of a development featuring five recently built showroom/warehouses located just off Bay Road and in close proximity to Neapean Highway.
 
<hr>
 
<img src="/images/stories/2012/08/350kplus.gif">
The net annual rental that Australian energy supplier and infrastructure company Jemena will pay on a new five-year lease at Campbellfield in Melbourne’s outer northern suburbs. The 153 Barry Road complex comprises a modern office/warehouse of 3,810 square metres, large hardstand areas, two container-height roller doors and air-conditioned offices. The deal was brokered by Savills industrial director Michael Green.The lessor is a private Melbourne investor.
 
<hr>
 
<img src="/images/stories/2012/08/330k.gif">
Roughly how much electrical construction and maintenance company Electrix will pay to lease 3,300 square metres of industrial space at 1/8 Weddel Court, Laverton North within the William Angliss Estate in Melbourne’s West. The five-year deal was negotiated by Colliers International’s Nathan Bingham and Nick Saunders. The tenant was represented in the transaction by Stephen Stockdale of Stockdale Property. The total development area at Weddel Court is in excess of 10,000 square metres, and Colliers international has secured two transactions prior to the completion of construction, bring the development to over 75% occupancy.
 
<hr>
 
<img src="/images/stories/2012/08/420.gif">
The gross annual rent per square metre that Besmaw will pay to lease a 165-square-metre office at level 7, 221 Miller Street, from Birriga Investments. The lease term is three years plus a three-year renewal option, with the agreement brokered by Darren Kable of LJ Hooker Commercial.
 
<hr>
 
<img src="/images/stories/2012/08/327.gif">
 The gross annual rent per square metre that Works Perfect will pay to lease a 70-square-metre office at 97 Pacific Highway in North Sydney from Terra Nova Coach Tours. The lease term is two years plus a one-year renewal option. The lease agreement was brokered by Lana Asscher from Aspace Estate Agents.
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Commercial leasing: Electricity provider Jemena leases in Melbourne

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The remote Queensland mining town of Mount Isa and the agriculturally rich NSW country town of Mudgee have both managed rental growth of around 25% over the past year, according to July figures from Residex.
Mount Isa is 1,800 kilometres north west of Brisbane and adjacent to mining giant Xstrata’s underground copper and zinc mining activities.
The less remote Mudgee is 270 kilometres north-west of Sydney, in the fertile Cudgegong River valley, and is well known as a wine-producing region, with around 40 wineries as well as other agricultural and livestock industries.
According to Residex, Mount Isa house rents increased by 25.4% over the year to July to a weekly median rent of $395.
In Mount Isa, <a target="_blank" href="https://www.realestate.com.au/property-other-qld-mount+isa-408411171">this two-bedroom furnished unit </a>(pictured below) is available for rent at $385 per week, with not much else available around the median and only 28 properties available to rent on realestate.com.au.
<img src="/images/stories/2012/08/mti.jpg">
Rents for Mudgee houses increased by 24.2% over the year to July to a median of $385 per week.
Properties currently available for rent close to the median rent in Mudgee include this four-bedroom hardiplank-clad home (pictured below) set in an elevated position surrounded by 30 acres (12 hectares) of hilly country, asking $400 per week.
<img src="/images/stories/2012/08/mudg.jpg">
According to Resides the following 15 housing markets have managed double-digit rental growth over the year to July (the report includes some inner-city markets):
 <table cellpadding="0" cellspacing="0" border="1" style="width: 470px;"><tbody>
<tr>
<td width="205" valign="top"></td>
<td width="205" valign="top">
% rent increase over year to July
</td>
<td width="205" valign="top">
Median weekly rent
</td>
</tr>
<tr>
<td width="205" valign="top">
Mount Isa houses, Qld
</td>
<td width="205" valign="top">
25.4%
</td>
<td width="205" valign="top">
$395
</td>
</tr>
<tr>
<td width="205" valign="top">
Mudgee District houses, NSW
</td>
<td width="205" valign="top">
24.19%
</td>
<td width="205" valign="top">
$385
</td>
</tr>
<tr>
<td width="205" valign="top">
Mackay houses, Qld
</td>
<td width="205" valign="top">
21.43%
</td>
<td width="205" valign="top">
$510
</td>
</tr>
<tr>
<td width="205" valign="top">
Neutral Bay/Split houses, Sydney
</td>
<td width="205" valign="top">
20.8%
</td>
<td width="205" valign="top">
$1,335
</td>
</tr>
<tr>
<td width="205" valign="top">
Inner Perth houses
</td>
<td width="205" valign="top">
16.54%
</td>
<td width="205" valign="top">
$740
</td>
</tr>
<tr>
<td width="205" valign="top">
Parramatta &amp; Hills houses, Sydney
</td>
<td width="205" valign="top">
15.63%
</td>
<td width="205" valign="top">
$555
</td>
</tr>
<tr>
<td width="205" valign="top">
Rockhampton house, Qld
</td>
<td width="205" valign="top">
14.49%
</td>
<td width="205" valign="top">
$395
</td>
</tr>
<tr>
<td width="205" valign="top">
Fremantle houses, Perth
</td>
<td width="205" valign="top">
14.29%
</td>
<td width="205" valign="top">
$520
</td>
</tr>
<tr>
<td width="205" valign="top">
Brisbane City houses
</td>
<td width="205" valign="top">
13.04%
</td>
<td width="205" valign="top">
$520
</td>
</tr>
<tr>
<td width="205" valign="top">
Lower north shore houses, Sydney
</td>
<td width="205" valign="top">
12.96%
</td>
<td width="205" valign="top">
$915
</td>
</tr>
<tr>
<td width="205" valign="top">
Western suburbs houses, Sydney
</td>
<td width="205" valign="top">
12.77%
</td>
<td width="205" valign="top">
$530
</td>
</tr>
<tr>
<td width="205" valign="top">
Geelong and surrounds houses, Vic
</td>
<td width="205" valign="top">
12.12%
</td>
<td width="205" valign="top">
$370
</td>
</tr>
<tr>
<td width="205" valign="top">
Glen Waverley houses, Melbourne
</td>
<td width="205" valign="top">
11.70%
</td>
<td width="205" valign="top">
$525
</td>
</tr>
<tr>
<td width="205" valign="top">
Albany Creek houses, Qld
</td>
<td width="205" valign="top">
10.59%
</td>
<td width="205" valign="top">
$470
</td>
</tr>
<tr>
<td width="205" valign="top">
Wynnum houses, Brisbane
</td>
<td width="205" valign="top">
10.34%
</td>
<td width="205" valign="top">
$480
</td>
</tr>
</tbody></table>
Source: Residex regional market report, July 2012
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Mount Isa and Mudgee rents rocket 25% over past year: 15 double-digit rental growth locations 

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Mount Tamborine in the Gold Coast hinterland was the strongest-performing regional housing market over July, according to new figures from Residex, with a number of regional Queensland markets performing well, including Noosa.
Residex reported that all state regional housing markets – apart from Tasmania – reported median capital growth over the month, however only five regional housing markets managed monthly growth of 3% of more.
Houses prices in Mount Tamborine increased by 5.26% over the month of July to a median of $412,000.
The suburb sits on a scenic 28-square-kilometre plateau, 525 metres above sea level, and many Mount Tamborine houses currently listed for sale sit on large rural or lifestyle blocks.
They include<a href="https://www.realestate.com.au/property-house-qld-tamborine+mountain-111154739" target="_blank"> a three-bedroom house on a 2,000 square metre block</a>, listed for sale at $445,000 by Blake Wallis of Tamborine Mountain First National Real Estate.
Properties that sold in Mount Tamborine over July include this four-bedroom house in Central Avenue (pictured below), built on 9,500-square-metre block in 1994, which sold for $686,500, having last traded for $97,500 in 2001. It was first listed for sale in January 2011 at an asking price of $790,000.
<img src="/images/stories/2012/08/tambourine.jpg">
Another Mount Tamborine property to sell over July <a href="https://www.realestate.com.au/property-house-qld-north+tamborine-110953331" target="_blank">was a 1940s-era Queenslander</a> featuring three bedrooms and “lots of fruit trees” on a 9,000-square-metre block, which sold for $395,000 through Emma Hawker from Raine &amp; Horne Tamborine Mountain. It was listed for sale at $394,000 in September 2011 and last traded for $374,000 in August 2007.
Despite recording a quarterly gain to July of 7.24% – also the strongest of all regional markets – Mount Tamborine house prices are still down 4.2% for the year.
Also in south-east Queensland, Noosa house prices on the Sunshine Coast increased by 3.33% to $410,500, in contrast to the Gold Coast, where Surfers Paradise houses were unchanged at a median of $510,500.
There was also a strong showing from the remote regional town of Charleville, in south-western Queensland, 758 kilometres west of Brisbane and immortalised in the song of the same name by country singer Slim Dusty.
Charleville house prices increased by 4.03% over July to median of $247,000 and are up just over 1% for the year.
In NSW, Bathurst Orange houses was the standout market with values up 3.02% to a median of $274,000, while in Victoria, the stand-out regional housing markets were Mildura, where house prices grew by 3.89% to $188,500, and Shepparton, where house prices increased by 3.46% to a median of $230,500.
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Mount Tamborine in Gold Coast hinterland top-performing regional housing market in July: Residex

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<img src="/images/stories/2012/08/14mplus.gif">
How much a first-time buyer of commercial property has paid for an office building at 11 Dorcas Street in South Melbourne in an off-market sale negotiated by CBRE’s team of Mark Wizel and Justin Clarkson on behalf of a group of private Melbourne-based investors. The modern five-level office building is fully leased to information technology company Dimension Data. Based on the current passing income the sale reflects a yield around 8.1%. The building was purchased by a Malaysian family who has been keen to secure a Melbourne property for some time. CBRE says the sale of 11 Dorcas Street adds to the ever-growing list of Victorian commercial properties to sell to interests associated with Malaysian, Singaporean or Chinese investors.
 
<hr>
 
<img src="/images/stories/2012/08/1point52m.gif">
The net income generated by a peripheral parcel of Sydney Corporate Park, set to be sold by F.Hannan Properties Pty Ltd in what will be the first investment-grade opportunity in South Sydney this year. The asset comprises two tenanted buildings totalling 8,857 square metres on 13,642 square metres of land. The net income translates to an average of $170 per square metre net. Colliers International’s Michael Crombie and Gavin Bishop are seeking expressions of interest closing September 19, 2012. The last investment sale of this kind was in November 2011, when Dexus paid $76.8 million for the Sir Joseph Banks Corporate Park in Botany.
 
<hr>
 
<img src="/images/stories/2012/08/501k.gif">
How much Osrta Cabinets has paid for a 366-square-metre strata warehouse 2/7-11 Brough Street in Springvale in Melbourne’s south-east. The industrial property was purchased from a private investor in a deal negotiated by Jamie Stuart and Sasan Misaghian from Colliers International. The purchaser is expanding and relocating a cabinet-making business from Tullamarine.
 
<hr>
 
 
<img src="/images/stories/2012/08/4point45m.gif">
The price paid for the property housing the iconic Mary Ryan’s Books, Music and Coffee store in Milton in Brisbane in a deal negotiated by Colliers International. The off-market deal, in which a local private investment company purchased the retail property at 40 Park Road, was struck by agents Jock Murray and Hunter Higgins. The property consists of a circa 700-square-metre building on an 810-square-metre site.
 
<hr>
 
<img src="/images/stories/2012/08/1point9m.gif">
The price paid for a blue-chip investment in Australand’s Checkpoint business park at Banyo, five kilometres west of Brisbane Airport. Anthony White, Colliers International industrial director, handled the transaction on Australand’s behalf for the 746-square-metre industrial strata unit at 11/368 Earnshaw Road. It was snapped up by a private investor from Sydney.  The property has been leased to Zip Heaters since the beginning of the year, when it signed a six-year lease with a five-year option. The property returns a net annual rental of just under $160,000, representing a yield of 8.25% for the buyer. As well as the return, White says the buyer was attracted by the solid tenant, the long-term lease in place and the standard of property’s construction.
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Commercial hammer prices: Malaysian family pays $14 million plus for South Melbourne office tower

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Property developer and fund manager Peet has reported a 76% fall in net profits for the 2012 financial year in what it described as challenging market conditions, with Victoria the toughest market where it has projects under development.
Net profits for the year to June were $20.3 million, just ahead of earlier market guidance of $15 million to $20.2 million.
Earnings in Peet’s residential development operations declined 50% compared with the 2011 financial year to $20.2 million as lot settlements for the year declined to 395 from 598.
A further $40 million worth of contract are due to settle by December 2012.
Contracts on hand fell from 1,125 in 2011 to 788 in 2012 – worth $788 million – with Peet attributing this to “market weakness, substantially reduced capital investment in certain Victorian projects and difficulty of buyers obtaining finance”.
In particular it reported a slow-down in sales at its $293 million Aston residential development in Craigieburn, where more than 1,500 lots ares still available on Melbourne’s fringe. Its $131 million Ardan development in Greenvale featuring 558 lots has been deferred.
The developer expects market conditions to remain challenging in the 2013 financial year.
However, it says positive signs are emerging in WA and Queensland is also poised for recovery, with housing finance growth and building approvals improving.
Peet’s biggest residential project is Flagstone City, 45 minutes south-west of Brisbane in Jimboomba, which has a gross development value of $1.87 billion and is due to begin in 2013. It features 1,500 lots and is proceeding as scheduled.
In total Peet has a lot pipeline of 34,600 worth $6.2 billion.
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Peet profits fall 75% in 'challenging year' as residential lot sales decline

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Woolworths has confirmed that it plans to sell close to $1 billion worth of shopping centres held in its property portfolio.
Woolworths finance director Tom Pockett told investors today that “probably somewhere between $800 million or $900 million plus” worth of property was available for sale, with the total value depending on whether centres were completed or under development.
The supermarket group owns a portfolio of neighbourhood and sub-regional shopping centres.
As part of its annual results presentation last week, Woolworths told shareholders it had “passed the peak in its property development pipeline” as the supermarket reported a 14.5% drop in net profit after tax to $1.8 billion.
Sale of the stores was mooted by the Australian Financial Review earlier this year, which said Woolworths was looking to return to its core retailing activities.
In September last year Woolworths took the unusual step of buying the Centro Lismore, NSW, shopping centre, where it is the anchor tenant on a short-term lease.
But corporate affairs spokesman Simon Berger told Property Observer at the time that the main focus for Woolworths remained being a retailer and “looking for opportunities to serve our customers”.
“We will develop or acquire where it suits our interests and customers, but we also lease in plenty of places,” he said.
In July last year, Woolworths completed the sale of eight neighbourhood and sub-regional retail shopping centres to a 50/50 joint venture entity owned by Charter Hall Retail REIT and Telstra Super for $266 million at an initial yield of 7.94%.
Pockett told investors Woolworth was always offering properties to investors but this is the first time the supermarket has confirmed plans for a large-scale divestment.
Pockett highlighted that sales activity would be driven by buyer interest in the group’s centres and Woolworths would not be giving its centres away.
He described current investor appetite as “a bit lower than last year” amid a “tough” investor environment.
Woolworths is targeting yields of 6% to 7%, a range it has struggled to achieve, reported RBS analysts Daniel Broeren and Alexander Beer.
Commonwealth Bank analysts estimate that Woolworths actually holds closer to $2 billion worth of property assets that could be sold.
It estimates that at the current rate of new development, Woolworths’ property portfolio could accumulate to a value of around $8.5 billion by 2017.
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Woolworths confirms plans to sell up to $1 billion worth of shopping centres

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New home sales got off to a bad start in the new financial year, with July sales down 5.6% following three consecutive months of modest but rising sales, according to the latest HIA New Home Sales report.
The HIA recorded just over 4,000 new home sales over the month, compared with more than 5,500 in June, based on its monthly survey of Australia's largest volume builders.
Three years ago monthly new home sales were close to 8,000, peaking at around 8,600 in August 2009 helped by the federal government-funded first-home buyer boost, which ran from October 2008 to December 2009, providing a bonus $7,000 for those first-home buyers who bought a new home, on top of the $7,000 for all first-home buyers.
Over July the HIA recorded a 5.5% fall in the “persistently weak detached housing segment”, with a 6.4% drop in the more volatile multi-unit market.
Click to enlarge
<a href="/images/stories/2012/08/hiaaug28.gif" rel="shadowbox" title="Click to enlarge"><img src="/images/stories/2012/08/hiaaug28thumb.gif"></a>
Across the major markets, Queensland was the only state to buck the trend, with a seasonally adjusted rise of 11.1% in detached new home sales in July.
New detached house sales fell by 6% in New South Wales, 4.6% in Victoria, 8.9% in South Australia, and 14.4% in Western Australia.
“New home building is the weakest sector of the Australian economy. Despite interest rate cuts in 2011-12, the two updates for this financial year – new home sales and the Australian Industry Group- HIA Performance of Construction Index – both point to deteriorating conditions in July," says HIA chief economist Dr Harley Dale.
“Now is a good time to build a home. Interest rates are lower, it’s a very competitive market, and there is less pressure on skilled labour availability.
"However, consistently weak consumer (and business) confidence is weighing very heavily on new housing investment, far more so than is the case for retail expenditure," Dale says.
“Combine that low confidence with very tight credit conditions and excessive taxation, and you have the unpalatable recipe for the recessionary conditions facing new housing.
“Leading indicators suggest this situation will persist well into 2012/13," says Dale.
More insights into the state of new home building will be revealed when ABS building approval figures for July are released on Thursday.
In June the ABS recorded a 1.1% seasonally adjusted fall in approvals for private sector houses, but with rises in Queensland (5.3%), Western Australia (4.4%) and South Australia (0.4%).
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Queensland the only bright spot as new home sales fall 5.6% in July: HIA

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Melbourne recorded $629.5 million worth of commercial office CBD investment sales over the first six months of year, trumping Sydney, which managed $478.6 million of sales, according to new research by Colliers International of sales worth $20 million or more.
The biggest whole asset sale in Melbourne over the first six months of the year was 150 Collins Street, which was purchased by GPT Wholesale Office Fund for $181 million on a yield of 6.77%.
Sydney’s most expensive single asset sale was Macquarie Bank’s $131 million vacant possession purchase of 48 Martin Place on yield around 7% and 7.5% (as estimated by Knight Frank).
The only premium-grade asset sale in Sydney during the first half of 2012 was the 25% acquisition of 126 Phillip Street for $176 million by Investa Commercial Fund from Investa on a yield of 6.35%.
Of the two office markets, Sydney has the brighter short-term outlook, with Melbourne's vacancy rate expected to continue to rise.
Colliers says that despite a large number of buyers chasing better-quality assets across Melbourne’s CBD office market, “the short-term outlook for transaction volumes remains subdued”.
“This is a function of the lack of investment-grade stock on the market for sale, as opposed to low levels of demand.
“As a result we expect face rents to remain stable while incentives will experience further increase, as landlords look to offer more to attract and secure tenants. This will in turn lead to further declines in effective rents across all grades over the next 12 months.”
In the case of the Sydney CBD market, Colliers expects leasing and tenant enquiry activity to remain “buoyant from smaller non-CBD based tenants who are looking to take advantage of softer market conditions to evaluate and upgrade their tenancies”.
“Limited supply entering the market and positive absorption over the remainder of 2012 is expected to see vacancy rates decline across the Sydney CBD office market.
“This is expected to result in subdued rental growth and a stabilisation of incentives over the period.”
The most recent Property Council of Australia office report recorded that the Melbourne CBD office vacancy rate increased from 5.2% to 5.6% from January to July, while Sydney recorded a 1.5 percentage point contraction from 9.7% in January to 8.2% in July – the largest decline of all CBD markets over this period.
Colliers International forecasts the Sydney CBD vacancy rate to decline further over 2012 to 7.9% by January 2013, before rising slightly to 8.2% as of July 2013.
In contrast the Melbourne CBD vacancy rate is expected to trend upwards to peak at 7.5% by July 2013 as 234,000 square metres of new supply comes on board over the next two years – before starting to trend downwards again.
Colliers attributes the decline in the Sydney CBD office vacancy rate to a “distinct lack of supply”, with only 13,225 square metres entering the market over the first six months of the year, combined with a positive absorption result of 45,300 square metres during the period.
Renting premium and A-grade office space in Melbourne remains significantly cheaper than in Sydney.
According to Colliers, top-of-town Melbourne premium office rents range from $480 to $665, with A-grade office rents ranging from $392 to $457.
Premium core Sydney CBD office rents start from $800 to $1,295 while core A-grade rents range from $650 to $820.
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Rental returns are quite similar for premium-grade and A-grade assets in both capital cities.
Premium Sydney office yields have remained stable in six months to July 2012, sitting between 6.25% and 6.75%, while A-grade yields also remained stable during this period, recording between 6.75% and 8.15%.
Premium Melbourne yields also remained stable in six months to July 2012, sitting between 6.50% and 7% while A-grade yields also remained stable during this period, falling in a range between 7% and 7.75%.
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John Marasco, Colliers International managing director of investment services, says Sydney prime grade yields have stabilised, while the yield spread between high- and low-quality secondary-grade assets has continued to widen.
“Quality office buildings, particularly premium and A-grade, that offer a weighted average lease expire (WALE) of four years or greater continue to be in high demand from investors.
“A lack of this type of property on the market for sale has seen sales volumes remain low, and this has led to the stabilisation of prime grade yields during the first half of this year,” he says.
“The outlook for the next six months is overwhelmingly positive, as the number of genuine enquires for investment properties in Sydney’s CBD has increased since the end of the 2011-12 financial year,” he says.
“We predict this will translate into a greater number of assets sold in the second half of 2012, with Sydney ending the year on a definite high.”
Nerida Conisbee, Colliers International national director of research, says Melbourne CBD office property remained highly sought after despite a rising vacancy rate and declining rents, with Premium and A-Grade stock experiencing particularly strong demand.
Marasco says good quality Melbourne CBD assets continue to attract “keen interest and this interest is coming from a range of different buyer types.
“A high proportion of demand is coming from offshore, but there should also be no underestimating the level of active domestic capital.”
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Melbourne trumps Sydney on office investment sales activity but not on short-term outlook: Colliers International

<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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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.

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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.

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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.

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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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