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The Docklands premises of James Squire Restaurant and Bar has been snapped up by private investors as a new report highlights a growing appetite for restaurants and cafes with established tenants in metropolitan Melbourne. 
The two-level, 950-square-metre property at 1 Pearl River Road within Docklands’ Victoria Harbour precinct was bought by a private investor for $4.3 million on a 9.3% yield following an expressions-of-interest campaign directed by Nick Peden and Clinton Baxter from Savills Australia. 
The sale price equates to $4,500 per square metre and “represented a strong price for ground and first floor strata retail,” Peden says. 
James Squire Restaurant and Bar pays a current net rental of $400,000 per annum with fixed annual 4% rental growth. 
Peden says the property attracted a great deal of interest from investors “keen to take advantage of the secure lease profile and prime waterfront location”. 
“Properties on the waterfront always attract a good level of interest and with a secure 10-year lease with a 10-year option, commencing July 2011, to a well-established business, it was always going to see a reasonably good result,’’ says Peden. 
“With the Docklands residential population growing rapidly and the precinct maturing in commercial terms, investors have again turned their attention to this remarkably active and evolving location,’’ says Baxter. 
According to the Docklands Authority, the precinct is expected to become home to 17,000 people, a workplace to 40,000, and a destination for 55,000 visitors per day by 2020. 
The sale of the Victoria Harbour restaurant premises comes as a Colliers International notes a pick-up in investor demand for restaurants and cafés with established tenants in Melbourne’s east, about two kilometres from Docklands. 
Colliers International’s Hamish Burgess and Ben Baines report receiving a “flood of enquiries from eager investors” since listing The Palms restaurant at 213-215 Blackburn Road in Mount Waverley.
The recently renovated 435-square-metre property, which sits on 1,015 square metres and has a 10-year lease, is attracting interest is in the vicinity of $1.9 million to $2 million. 
Burgess says interest in the property, which will go under the hammer on March 29, confirms the recent trend towards restaurants and cafes as investments.
“There has been a noticeable trend evolving lately whereby sub-$5 million property investors are searching for restaurant and café investment properties with secure, long-term tenancies in metropolitan Melbourne,” he says. 
According to Burgess investors are focusing on restaurants and cafés with high-profile, well-established tenants. 
“This represents increased security, as operators are continuing to spend significant amounts on fit-outs and don’t want to lose clientele by moving location,” he says. 
According to Baines, recent sales of restaurants in Melbourne’s east indicate that investors are willing to pay a premium for this sort of investment. 
Three recent restaurants sales all achieved yields of under 5%:
<ul>
<li> 210 Blackburn Road, Glen Waverley: achieved a yield of 4.6% with Subway as a tenant</li>
<li>313 Stephensons Road, Mount Waverley: achieved a yield of 4.1% with Pizza Hut as a tenant</li>
<li>319 Stephensons Road, Mount Waverley: achieved a yield of 4% with Great Eastern Hakka Restaurant as the tenant</li>
</ul>
 
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lschlesinger-FZcF9M3vE6

Docklands restaurant James Squire sells with 9.3% yield as investor appetite for Melbourne eateries grows 

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First-home buyer demand should continue to pick up in 2012, particularly in NSW and Western Australia, but there will be no recovery in Victoria, according to the latest forecasts from BIS Shrapnel.
“We started to see a pick-up in NSW And Western Australia towards the end of last year, which was emphasised by the expiration of stamp duty exemptions for existing properties,” BIS Shrapnel senior manager Angie Zigomanis said at the March 2012 Building Industry Prospects conference yesterday.
“But it is still weak in Victoria, and one of the reasons why it is still weak is because the state government has tended to keep the first-home buyer incentives fairly elevated, which has pushed forward demand.
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“First-home buyer demand is very important because it creates demand at the bottom of the market for the next group of buyers to trade up.
“It’s that turnover and activity that flows to price growth and also brings more investors into the market.”
Zigomanis says this churning of property created by first-home buyers entering the market won’t be felt as strongly in Victoria.
“In Victoria the weakness in first-home buyer demand is permeating through to the rest of the market,” he said.
According to Zigomanis there are only a “finite number of first-home buyers out there”, and all the incentives do is encourage these buyers to purchase sooner.
“We had the federal government incentives when the GFC hit and then followed by the state government incentives,” he says.
As a consequence of demand being pulled forward, subsequent demand will fall off much more strongly, Zigomanis says, meaning that there will be no recovery in first-home buyer numbers Victoria until the end of 2012 or the start of 2013.
Victoria’s first home bonus and regional bonus, which awarded grants of $13,000 and $6,500 respectively to qualifying first-home buyers, are both set to expire at the end of 2011-12.
However BIS Shrapnel warns “the Victorian government has shown a tendency in the past to extend such grants, and hence it is quite possible they will do so again”. <img src="/images/stories/bismarch213.gif">
Looking at the overall state of residential markets, Melbourne remains one of the weak spots, with vacancies heading up towards the 3% mark, which indicates a balanced market.
BIS Shrapnel estimates put the Victorian deficiency at approximately 23,100 dwellings as at June 2011, with newly completed dwellings coming onto the market over 2011-12 and 2012-13 likely to cause this number to fall. 
“In fact in some areas of inner Melbourne we feel that the market may even be in slight oversupply. This means there is significantly less pressure in the Victorian property market than is evident in New South Wales,” says BIS Shrapnel. 
“The residential vacancy rate in Melbourne has gradually risen over 2011 to reach 2.4% as at September 2011. As a result, our expectations for growth in property prices as well as rents are much more subdued in Melbourne than it is in the tighter market of Sydney. This in turn will ultimately limit demand from the investor segment of the market.”
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On the other hand vacancies in Brisbane, Perth and Sydney have tightened.
“Rental growth is coming up in Brisbane, but it has been pretty flat in Melbourne,” says Zigomanis.
During his presentation, BIS Shrapnel director Robert Mellor said the bump up in first-home buyer numbers in 2011 “was not all the result of the demand being brought forward in NSW”.
“People are responding to lower interest rates and an easing back in prices. Now may be a good time to buy relative to staying in the rental market,” he said.
“Housing interest rates are not the issue, affordability is not the issue – the real issue is confidence.
“What is going to tip it? After 30 years of forecasting I cannot answer that,” he said.
 
 
 
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Victoria to miss out on first-home buyer pick-up and churn factor: BIS Shrapnel

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The real estate sector is set to pick up in the second half of the year driven by opportunities created by the mining boom, but the property industry as a whole has not fully recovered since the GFC, says BIS Shrapnel economist Frank Gelber.
“When I say property has not recovered, I’m talking about property the industry, the people that work and provide services to the sector,” Gelber said at the March 2012 BIS Shrapnel forecasting conference yesterday.
According to Gelber the property industry is still “bumping along at the bottom of the cycle”.
“We’re not providing all the services we did pre-GFC because we don’t have the funds available.
“The great deleveraging of property has not yet finished. The REITs have managed to get their hands on some equity but a lot of the unlisted property trusts are still in the hands of the banks.
“A lot of these single property unlisted trusts have long ago breached their loan covenants,” he says.
The latest economic outlook prepared by BIS Shrapnel point to an improvement in overall conditions for the sector.
New capital expenditure is set to rise in the second half of the year following a small but sharp dip in the last 12 months:
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According to BIS Shrapnel, the real estate, rentals and hiring sector was one of just a few sectors to record an increase in wage inflation compared with average inflation, which drifted lower over 2011 due to zero employment growth.
“[The real estate, rentals and the hiring sector and the professional, scientific and technical services sector] are two sectors that are benefiting from the work generated by the minerals-related investment,” says BIS Shrapnel. 
The report also notes that excluding a dip pre-GFC, the real estate, rentals and hiring has “consistently generated profit margins near or above 40% for over a decade”. 
“Recently, these margins have edged higher, and with income remaining steady since 2009, profits are on the increase, particularly in the unincorporated sector,” says BIS Shrapnel.
 
 
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Mining boom to create opportunities in property, but sector has not yet recovered from GFC: BIS Shrapnel’s Frank Gelber

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Investors should consider putting their money into retail property trusts, according to post-reporting season analysis by Goldman Sachs REIT analysts Simon Wheatley, Peter Zuk and Andrew MacFarlane. 
In their March monthly REIT outlook, Wheatley, Zuk and McFarlane have picked the Westfield Retail Trust (WRT) as the “best buy idea” and maintained an overall “neutral” outlook on the REIT sector. 
The following chart shows the net operating income growth of WRT and Stockland (SGP) compared to Mirvac (MGR), GPT and the CFS Retail Property Trust (CFX).
Goldman Sachs’ other recommended REIT buys are the diversified trusts Charter Hall (CHC) and Stockland (SGP) and the Goodman Group (GMG) industrial trust.
Although the outlook for retail remains challenging, they note that bankruptcies in the sector for the 2012 calendar year to date have been “next to zero” compared with four major retailer collapses over the same time period last year. 
“By this time in the 2011 calendar year, there had been four major retailers (RedGroup, Ed Harry, Bijoux Accessories and Covers Designs) go into bankruptcy impacting 340 stores in Australia,” the report says. 
“We estimate two-thirds of these stores ultimately closed. By the end of the first quarter of 2011, these store bankruptcies had risen to a substantial 804 stores with the failure of Colorado and Perfume Empire. 
“Contrast this with 2012 calendar year. To date there have been no chain retailers enter bankruptcy with a benign 2011 Christmas trading period and our expectation that we could see some retailer failures. 
“The only two retailers who have stumbled are Sleep City (64 stores) and WOW Audio (15 stores), however neither has any real exposure to shopping centres,” say the Goldman Sachs analysts. 
According to Goldman Sachs shopping centre landlords currently have “negligible exposure to national retailers on any [bankruptcy] watch lists” .
“Other factors which suggest that there remains an apparent equilibrium regarding rent stress include; stable reported arrears; continued positive re-leasing spreads on expiring leases; no meaningful reduction in the tenant retention rate and negligible vacancy,” the report says. 
“Downside risk is very contained in our view. As such the best buying opportunities continue to be in retail REITs and this was reinforced by the reporting season results.” 
Beyond retail, Goldman Sachs says office occupancy levels have remained stable, but says they may have peaked and will soften into the end of 2012 financial year (end of June). 
The investment bank has weaker convictions about the residential outlook as a result of lower lot sales. However it notes that margins have held and there are better contracts on hand than at the end of the previous comparable period. 
“The outlook continues to see management avoiding the higher-end price point and satiating and stimulating demand at the more affordable end of the range,” says Goldman Sachs. 
“The outlook commentary was notably cautious, with fundamentals in NSW reported to be solid, Victoria continuing to moderate, and Queensland still extremely soft although showing some tentative signals.” 
Goldman Sachs is forecasting a 2012 calendar year capital return for the REIT sector of 15.5%, a yield of 6.87% for a total return of 22.4%.
 
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Retail REITs offer best investment potential: Goldman Sachs

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Steady February auction clearances rates encouraged the Reserve Bank to keep interest rates on hold, the full minutes of the March Monetary Policy Meeting of the Reserve Bank Board have revealed.
In making its decision to leave rates on hold, the board noted that the “housing market remained soft, with auction clearance rates in February broadly unchanged from late 2011”.
“Housing credit continued to grow at a slower rate than nominal income,” the minutes also say.
The RBA board identified “Europe and its potential flow-on effects to the rest of the world as the major downside risk for Australia”.
The Australian economy remains sensitive to developments in east Asia, but this is now less of a risk than a few months ago.
The minutes also show the RBA has scope to ease policy in response to any adverse scenario.
According to Westpac senior economists Matthew Hassan and Andrew Hanlan, the main difference between the March minutes and the February minutes is a “significant change in the discussion of structural adjustment in the Australian economy”.
Following the release of the minutes, Westpac Economics says it continues to expect a 0.5% reduction in the RBA cash rate with an initial 0.25% move in May/June and a further 0.25% cut in July.
“To our ear, the shift has, if not fully opened the door to a rate move, at least seen it now slightly ajar,” says Hassan and Hanlan.
“Westpac remains less optimistic than the RBA both on the global front –  we anticipate further bouts of volatility emanating from Europe, disappointing momentum in the US and a more pronounced slowdown in China – and domestically where we view the high Australian dollar, structural adjustment and deleveraging as posing more substantial headwinds to growth.
“The change in RBA rhetoric suggests the debate on domestic conditions is becoming more open. Coupled with the quarter-four national accounts and the governor's comments in his March 19 speech it suggests that if further evidence of sub-trend growth emerges domestically, e.g. in labour markets, and the inflation backdrop remains benign the RBA may start considering further policy stimulus measures sooner rather than later.
“In February this was put mainly as an observation – that differences across sectors showed a degree of structural adjustment but that demand growth overall remained firm and the outlook was for a continued trend expansion with inflation around target.
“The March minutes were more equivocal, putting more emphasis on "the uncertainties inherent in assessing the response of the domestic economy to the disparate forces at work, including the very large rise in resources investment and the high exchange rate” and raising the key question of "whether the necessary adjustment was occurring at an overall pace of growth that kept the economy close to trend and inflation close to target."
According to the two economists, the other key points to come out of the minutes are that the Australian banking system remains relatively strong and the household sector continues to show a more cautious approach towards its finances.
“Aggregate measures of household financial stress remains low, though mortgage arrears rates remain somewhat higher than a few years ago,” Hassan and Hanlan note.
“For the business sector, conditions continued to vary significantly, with the divergent experiences helping to explain why banks' non-performing business loans and business failure rates were somewhat higher than average.
“Overall, though, the business sector was in a better financial position than several years ago, having deleveraged considerably and improved its liquidity position. The commercial property market, traditionally a source of vulnerability for banks, had continued to improve after the recent downturn, though construction activity remains muted and financing activity weak,” they say.
 
 
 
 
 
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Steady auction results helped keep RBA rates on hold, but Europe threat leaves door 'ajar' to further cuts says Westpac

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Average house prices in the 70 largest and mid-size cities in China fell 0.099% in February following falls of 0.14% in January and 0.22% in December, according to calculations by Dow Jones Newswires.

Mark Budden, North Asia area leader at property and construction consults EC Harris, expects property prices to continue to fall in the second half of 2012 and until Chinese government policies governing the property sector are altered.

Budden expects government regulation of the property sector – introduced two years ago – to remain in place for the forseeable future as part of efforts to curb real estate speculation.

Current regulations include not allowing existing home owners to buy a second investment property.

House prices though are still fractionally (0.17%) up on the same time last year, but trending down from the 0.7% year-on-year gain in January.

The Dow Jones calculations are based on the latest monthly Chinese government’s National Bureau of Statistics report, which showed that prices of newly built homes fell in in 45 of the 70 cities from January to February, compared with declines in 48 cities from December to January.

Prices in 27 of the 70 cities were lower in February than they were a year earlier (compared with 15 in January), with marginal price falls recorded in Beijing, Shanghai, Shenzhen and Guangzhou.

House prices increased in four of the 70 cities in February, compared with none in January.

Last week Chinese Premier Wen Jiabao said the government would continue to regulate the property sector to prevent chaos in the housing sector.

“We must not slacken our efforts in regulating the housing sector. A bursting property bubble would hurt the entire economy, and the government wants “long- term steady and sound growth” in housing, he said.

Earlier this month rating agency Standard &amp; Poor’s warned that Australian house prices could decline by more than 5% in 2012 if China's economy experiences a soft landing with GDP growth at about 8%.

But in the event of the less-likely scenario, under which China's economy slows to 5% GDP growth, Australia could be sent into recession, S&amp;P warned.

China's hard landing likely flow-on effect of higher unemployment could trigger a sharp decline in Australian house prices of 20% or more, according to S&amp;P, which rated the prospect of a hard landing happening at 10%. The other scenario – a medium landing – would trigger a 10% price fall, said S&amp;P. The company said there was a 25% chance of a medium landing.
 
 
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Tiny drop in Chinese house prices in February, but further falls expected

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Borrowers who bought their homes with small deposits may struggle to refinance their mortgages in 2012 due to falling property values, RateCity.com.au has warned.
The problem would apply to both variable-rate and fixed-rate mortgage holders looking to refinance into a new fixed or variable-rate loan but not to those that have signed a contract where a fixed-term loan automatically rolls over into a variable-rate mortgage from the same lender.
Mortgagees on high loan-to-value (LVR) ratios in Brisbane, Melbourne and Hobart will be most at risk of not being able to refinance, as their mortgage debt may now be greater than the value of their homes.
House prices fell by 6.8% in Brisbane in 2011, by 6.1% in Melbourne and by 5.9% in Hobart leading a 3.6% fall nationally, according to figures compiled by RP Data-Rismark.
A 3.6% decline in 2011 would translate into a $400,000 home falling to a value of $385,600 over the course of the year.
Changes in capital city property values year-on-year
<div align="center">
<table cellpadding="0" cellspacing="0" border="0" style="width: 470px;"><tbody>
<tr>
<td width="213">
City
</td>
<td width="213">
Median dwelling price
</td>
<td width="213">
Year-on-year change
</td>
</tr>
<tr>
<td width="213">
Sydney
</td>
<td width="213">
$485,000
</td>
<td width="213">
-0.3%
</td>
</tr>
<tr>
<td width="213">
Melbourne
</td>
<td width="213">
$462,500
</td>
<td width="213">
-6.1%
</td>
</tr>
<tr>
<td width="213">
Brisbane
</td>
<td width="213">
$420,000
</td>
<td width="213">
-6.8%
</td>
</tr>
<tr>
<td width="213">
Adelaide
</td>
<td width="213">
$370,000
</td>
<td width="213">
-4.4%
</td>
</tr>
<tr>
<td width="213">
Perth
</td>
<td width="213">
$450,000
</td>
<td width="213">
-4.3%
</td>
</tr>
<tr>
<td width="213">
Darwin
</td>
<td width="213">
$450,000
</td>
<td width="213">
-2.3%
</td>
</tr>
<tr>
<td width="213">
Canberra
</td>
<td width="213">
$488,000
</td>
<td width="213">
-2.2%
</td>
</tr>
<tr>
<td width="213">
Hobart
</td>
<td width="213">
$328,000
</td>
<td width="213">
-5.9%
</td>
</tr>
<tr>
<td width="213">
Capitals
</td>
<td width="213">
$450,000
</td>
<td width="213">
-3.6%
</td>
</tr>
</tbody></table>
</div>
Source: RP Data
“Imagine buying a $400,000 property with a 5% deposit,” says RateCity.com.au chief executive Damian Smith.
“On day one, you’d assume you had $20,000 of equity value in the property. But if the property’s value declines by 10%, then it’s worth just $360,000 – and you have no equity at all.
“If you try to refinance in those circumstances, you will find yourself owing more than the property is worth – a mortgage of $380,000 as against property value of just $360,000.”
Besides creating problems for buyers with high LVRs, Smith says a downturn in refinancing this year due to uncertain property values would be a serious blow to Australia’s lenders.
“The industry relies on refinancing of existing mortgages for a big proportion of their business. Refinancing was the main driver of home loan volume in 2011, as in fact it has been over the past decade.
“According to RateCity research, 51% of all home loans last year were from refinanced mortgages – this is the highest proportion of refinanced loans on record for at least the past 20 years,” Smith says.
“If property values drop further and it discourages borrowers from refinancing, the mortgage market could be in for a very slow year.
“But on the flip side, first home buyers and borrowers with more than 20% equity in their home are in the best position to find a great value home loan as lenders will be desperate to find new business.”
To make a more informed decision before you refinance, download Property Observer’s free eBook: <a href="http://propertyobserver.com.au/ebooks/free-ebook-12-tips-for-refinancing-your-mortgage" target="_blank">12 tips for refinancing your mortgage – how to find the best home loan in 2012</a>
 
 
 
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Refinancing trouble looms for borrowers with small deposits: RateCity

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There will be little reprieve for the residential building sector in 2012, but there will be growth in new home building led by WA, NSW and Queensland in 2013, according to forecasts from BIS Shrapnel. 
In its March 2012 Economic Outlook bulletin, BIS Shrapnel says that uncertainty around the economic outlook and funding difficulties for developers has meant that building approvals and commencements have remained weak, with new dwelling investment activity continuing to contract “for the next couple of quarters”. 
“However, increased first home buyer interest, interest rate reductions late last year, and extensive or emerging dwelling shortages should result in activity picking up later this year in New South Wales, Queensland and Western Australia,” the report says. 
BIS Shrapnel is forecasting a 5.2% fall year-one-year in total private dwelling investment for the year ended June 2012, recovering to a rise of 4.7% for the year ending June 2013. 
“We expect activity in the construction industry to remain weak for the next couple of quarters, before picking up in the second half of the year. The increased activity will initially be dwelling related, but we expect to see non-dwelling building activity also increasing, particularly in 2013,” says BIS Shrapnel. 
Western Australia is forecast to lead the rebound with a 29% gain in the value of new dwelling construction in 2013 following an 11% dip in 2012. 
In 2013, the total number of new houses built in WA is forecast to rise by 25% to around 19,000 following a 7% dip in 2012 while unit construction will jump by 47% to over 4,000 in 2013 following a flat 2012.
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BIS forecasts a 26% jump in residential construction in New South Wales in 2013 following a flat 2012.
There will be a modest 2% increase in the number of dwellings built in NSW in 2012 followed by a large 31% gain to over 40,000 in 2013, says the forecasting firm. 
Sydney is set to be the focus of new dwelling approvals in 2012, with 14% growth in the number of new homes approved in 2012 with 15% growth in 2013 to above 20,000. Strong growth in building approvals is also forecast for the Hunter region (12% in 2012 and 19% in 2013).
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Queensland’s residential construction sector is forecast to expand by 21% following a forecasted 7% dip in 2012. 
In terms of total numbers, new dwelling construction is expected to drop by 3% in Queensland in 2012 but increase by 22% to over 30,000 by 2013.
Among the smaller housing markets, BIS Shrapnel is forecasting a massive 47% boom in new housing construction in the Northern Territory in 2013 off the back of the $30 billion Inpex onshore gas project. 
Reflecting the imbalances in the economy, new dwelling construction is forecast to fall by 21% in Victoria in 2012 and then by a more moderate 7% in 2013 as the construction contraction in the state starts to bottom out. South Australia will rebound by 4% in 2013 and Tasmania by 5%. 
The outlook for the ACT is very poor, with a 27% drop in the value of new construction expected in 2012 followed by a 33% drop in 2013. 
Across the country new dwelling construction growth is forecast to dip by 13% in 2012 but will wipe out this deficit in 2013 with a 13% gain. 
Housing construction will rebound by 12% in 2013 following an 8% dip in 2012, while units will rebound by 15% in 2013 following a 15% drop in 2012. 
In its report, BIS Shrapnel says household income growth has slowed over the past couple of quarters, but still remains solid. 
“We expect it to start increasing again through the second half of 2012, driven by higher wage inflation and a return to employment growth,” the report says. 
“Nominal compensation of employees increased just 0.9% in the December quarter, reflecting zero employment growth and decelerating wage inflation over the year. 
“However, strong growth earlier in 2011 meant that year-on-year growth in nominal compensation of employees was still a very respectable 7.6% in the 12 months to December 2011. 
“We expect the annual rate to drift down to around 6% by the end of 2012, before it accelerates again. This will continue to support solid growth in household spending.” 
BIS Shrapnel forecasts an average standard variable mortgage rate of 7.4% in 2012, rising slightly to 7.8% in 2013.
 
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WA, NSW and Queensland to lead rebound in residential construction from 2013: BIS Shrapnel

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The south-east Queensland property market is edging towards recovery, led by increased sales activity for properties priced below $500,000, according to CBRE. 
However the Gold Coast market remains among the most under pressure markets in the country. 
In its 2012 first quarter report CBRE notes that the Brisbane market is showing more stability than the coastal markets and says “multiple offers” are now being lodged for properties in the sub-$500,000 price bracket. 
The report notes that the Gold Coast and Sunshine Coast markets have not yet stabilized, with the Gold Coast remaining among the worst-performing residential markets in Australia from both a capital growth and sales volume perspective.
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It notes that the Gold Coast suburbs of Beenleigh, Southport (both down 10.6% to medians of $441 and $399,000 respectively), and Surfers Paradise (down 9.1% to $520,000) have had the greatest median price falls over the past 12 months. 
Across the Gold Coast prices are down 11.4% to $324,000. 
In comparison property prices in Noosa on the Sunshine Coast have fallen by a more modest 5.2% to $432,000, though the report notes a larger number of mortgagee-in-possession sales. 
The outlook for the Gold Coast is not all gloomy, with CBRE noting an increase in buyer activity in the sub-$500,000 market as well. 
The report notes a pick-up in first-home buyer activity as a result of discounted pricing as possibly also as a result of the $10,000 building boost on offer from the state government until the end of April. 
Report co-author and associate director of global research at CBRE Sam Reilly says the pick-up in sales combined with a solid rental market and strong economic forecasts for the state suggest a strong turnaround is looming for property in the long term. 
However, the upper end of the market from $1 million to $2 million continues to struggle, a “wait and see” mood prevailing amongst investors. 
This is the case both in Brisbane and on the coastal markets. 
The report notes that the Sunshine Coast has not felt the same kind of pricing pressures as the Gold Coast and has seen a high level of buyer interest in its prestige sector as vendors finally adjusted their price expectations. 
According to CBRE mortgage valuations regional director and report co-author Tom Edwards, the biggest concern is the prestige sector in all cities. 
“Few sales are taking place and transactions that are completing are generally distressed sellers. For property between $1 million and $2 million, there has been a further slowing with price levels showing substantial discounts,” he says. 
As a result, vendors in this price bracket are choosing to renovate rather than try and sell at a reduced price. 
Reilly says sales activity for the remainder of 2012 is likely to be dictated by the confidence of the market. 
“Upward pressure on interest rates as well as the ongoing negative exposure from the eurozone issues may dictate the short term market direction, however a strong turnaround is looming” he says.
 
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South-east Queensland housing market recovering, with sub-$500,000 sweet spot: CBRE

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The appeal of self-managed super funds (SMSF) continues to grow, with 30,000 of these entities set up over the course of 2011, according to the latest figures released by APRA.
There are now 458,561 SMSFs in Australia compared with 428,226 at the start of the year – growth of 7%.
However, there has been less successful growth in the asset bases of these funds despite the growth in numbers.
As of December 2011, the value of assets held by SMSFs stands at $399.9 billion compared with $394.4 billion at the end of December 2010, growth of just 2.2%
The APRA figures do not provide a breakdown of the types of assets held by SMSFs, but according to SMSF administrator Multiport, 17.6% of SMSF portfolios comprise property assets, up from 15.7% a year ago.
Self-managed superannuation funds hold the largest proportion of the $1.31 trillion in superannuation assets, accounting for 30.6% of assets, followed by retail funds with 27.4% of total assets. 
Industry funds accounted for 18.9% of total assets, public sector funds 15.7% and corporate funds 4.1%. Small APRA funds held 0.2% of total assets. 
The total number of super funds (excluding SMSFs and other pooled funds) declined from 396 to 362 over 2011 with the number of corporate super funds falling from 150 to 128 and retail fund numbers declining from 144 to 137.
 
 
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About 30,000 new self-managed super funds established in 2011: APRA

The Gold Coast economy has grown by 25 per cent since 2020/21 to surpass $55 billion, but perhaps the more significant story is what sits behind the headline number.

For decades, the Gold Coast has been viewed through the lens of tourism, lifestyle and population growth. The latest State of the City Report suggests that perception is increasingly out of step with reality.

Released by Invest Gold Coast, the report ranks the Gold Coast as Australia's largest non-capital city economy and, perhaps more notably, second nationally behind Sydney for Economic Complexity, a measure that assesses the diversity and sophistication of an economy.

It's a result that places the Gold Coast ahead of Melbourne, Brisbane, Perth and Adelaide, highlighting the extent to which the city's economic base has broadened beyond its traditional industries.

Today, the Gold Coast supports more than 350,000 jobs, is home to over 83,000 businesses and generates $19 billion in annual exports. Manufacturing now accounts for 62 per cent of international export growth, while sectors including health, education, advanced manufacturing, technology and professional services are becoming increasingly important contributors to the local economy.

[smartcode_project:default project_id=150017 project_image_fid=372547]

Gold Coast Mayor Tom Tate said the report confirmed the city's evolution into one of Australia's most significant economies.

"The Gold Coast economy continues to grow at an incredible pace. This is no surprise to those of us who have watched the evolution up close," Mayor Tate said.

"As one of the most entrepreneurial, investment driven and opportunity focused economies in the country our ambition has been realised and possibilities are endless.

"The Gold Coast has built a reputation as the city that says yes. We say yes to investment, yes to opportunity and yes to people who want to build something.

"It's this mindset helping us drive major growth across health, advanced manufacturing, screen production, marine, technology and the knowledge economy."

[smartcode_project:default project_id=149670 project_image_fid=360975]

While population growth has been one of the defining stories of the past decade, the report points to a broader economic transformation taking place.

The city's knowledge economy now contributes $7.9 billion annually and supports around 31,000 jobs, while the health and wellbeing sector contributes $5.2 billion and employs more than 42,000 people. Together, the six priority sectors identified in the report account for almost $24 billion in economic output and more than 145,000 jobs.

One of the strongest examples is the Gold Coast Health and Knowledge Precinct at Southport. The 200-hectare precinct now contains more than $5 billion worth of health, education, research and innovation infrastructure and supports over 16,000 jobs.

The report also highlights the growing role of advanced manufacturing, particularly in aerospace, defence and modular construction.

Gold Coast-based Gilmour Space Technologies recently became the first Australian commercial company to attempt an orbital launch, while companies including Modscape and ModnPods are helping establish the Yatala-Stapylton corridor as one of Australia's fastest-growing advanced manufacturing hubs.

The city's entrepreneurial culture is also translating into business growth.

Since 2019/20, the number of businesses operating on the Gold Coast has increased by 22 per cent, while firms employing more than 200 people have grown by 80 per cent. The report suggests the next challenge is converting more local start-ups and medium-sized businesses into nationally significant companies.

Development activity remains another key indicator of confidence.

There are currently more than $23 billion worth of major projects underway across the Gold Coast, supported by a record 75 active cranes, a figure that now exceeds Brisbane and represents a 150 per cent increase since 2016.

[smartcode_project:default project_id=112024 project_image_fid=343235]

Importantly, the report notes the next phase of investment will need to extend beyond residential development.

While 93 per cent of crane activity is currently tied to housing, Invest Gold Coast argues future investment will increasingly need to focus on cultural, civic, infrastructure and industry-enabling projects that strengthen the city's long-term economic resilience.

Invest Gold Coast Chair Will Hodgman said the city was now benefiting from years of economic diversification.

"What is happening on the Gold Coast is the result of the city's economic base broadening, fuelled by industries with long-term, high-growth potential," Mr Hodgman said.

"This is no longer a secondary Australian economy, the Gold Coast is becoming a globally connected city with deeper capability across health, knowledge and creative industries, advanced manufacturing, technology and exports."

[smartcode_project:default project_id=108274 project_image_fid=365786]

Looking ahead, the Gold Coast's population is projected to exceed one million residents by 2046.

For a city that was once largely defined by tourism and lifestyle, the latest figures suggest the Gold Coast is becoming something more significant, one of Australia's most diverse and economically sophisticated urban economies, and increasingly one that national and international investors can no longer afford to overlook.

Joel Robinson

75 cranes, $23 billion pipeline and a $55 billion economy: Inside the Gold Coast economic boom

Ron Bakir's Homecorp has sold more than 75 per cent of the apartments in its wellness-driven Florence Residences in Surfers Paradise following its first weekend release.

The <a href="https://www.apartments.com.au/new-apartments/florence-residences-24-monte-carlo-avenue-surfers-paradise-qld-4217">26-storey project on Monte Carlo Avenue</a>, which commenced construction earlier this year, has seen a flurry of buyers secure their slice of the Gold Coast's latest wellbeing-focused offering in one of the nation's most competitive property markets.

Since the pandemic, the Gold Coast's population has grown by more than 11 per cent, a rate approximately four times faster than Sydney's, driven largely by lifestyle changes and interstate migration. While buyer activity has moderated in some markets nationally, demand for newly built dwellings on the Gold Coast continues to gain momentum as purchasers increasingly prioritise lifestyle, amenity, wellbeing, liveability and long-term investment potential.

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[smartcode_project:default project_id=150414 project_image_fid=372743]

Homecorp CEO Ron Bakir says buyers today are looking for more than just a home.

"What we are seeing is a shift in how people define value in property," Bakir says.

"What attracts residents to new developments is a desire for more than just a residence. They are looking for a place that complements their lifestyle, supports their wellbeing and reflects the way they want to live into the future.

"Lifestyle, longevity, proactive health, wellbeing, connection and a sense of community are increasingly shaping purchasing decisions, particularly on the Gold Coast, where these factors continue to be a major drawcard."

[smartcode_project:default project_id=150414 project_image_fid=372744]

Bakir says Homecorp is responding to this shift through an approach that places greater emphasis on design, amenity and experience working together to create places that feel considered, connected and enduring in value.

Inspired by Eastern European design, Florence Residences will comprise 120 apartments alongside a private residents-only wellness club featuring a resort-style rooftop pool, hot and cold plunge pools, a spa retreat, contemporary gymnasium, and a spacious yoga and Pilates studio.

The development will also feature a residents-only lounge with private dining facilities and a rooftop bar, premium outdoor entertaining areas, a hotel-style lobby lounge, generous bike parking, and pet-friendly amenities including a heated dog wash.

[smartcode_project:default project_id=150414 project_image_fid=372742]

A limited number of apartments remain available, with an exclusive collection of four-bedroom sub-penthouses set to be released in the coming months.

Florence is one of the latest additions to Homecorp's expanding multi-billion-dollar property portfolio, which also includes plans for a <a href="https://www.apartments.com.au/news/qld/homecorp-lodges-plans-for-260-million-moroccan-bathhouse-inspired-tower-in-budds-beach">$260 million development in Budds Beach</a> tailored to the growing wellness market.

A development application has been lodged for a 27-storey, 156-residence tower at 8–10 Acacia Avenue and 25–27 Oak Avenue, featuring a residents-only Moroccan spa-inspired sanctuary.

Apartments at Florence Residences are priced from $1,249,000, with construction expected to be completed by late 2027.

[smartcode_project_cta:default project_id=150414]

Buyers rush to Homecorp's Florence Residences as Gold Coast wellness trend gains momentum

The NSW Government has expanded its $1 billion Pre-sale Finance Guarantee program, broadening access for affordable housing providers and smaller residential developments as it seeks to accelerate housing delivery across the state.

The Minns Government says the program has already helped bring forward more than 600 homes across Sydney and regional NSW since launching in September 2025, with similar models now adopted in South Australia and Western Australia.

The latest changes, announced by Treasurer Daniel Mookhey and Minister for Planning and Public Spaces Paul Scully, are designed to improve access to finance for projects that have planning approval but are struggling to secure funding.

Among the key changes is an expansion of support for community housing providers. The program will now support up to 100 per cent affordable housing projects valued at up to $30 million when delivered by not-for-profit providers, while support for larger affordable housing developments will increase for projects worth up to $80 million.

The government says the changes will help accelerate the delivery of housing for low-income workers, older people, people living with disability, and those at risk of homelessness, while reducing reliance on direct grants or subsidised loans to bridge funding gaps.

The eligibility criteria for smaller residential developments have also been broadened. The previous $5 million minimum project value threshold has been removed and replaced with a requirement that projects deliver at least four homes.

Support has also increased for projects delivering fewer than 20 homes, with the guarantee now able to cover up to 75 per cent of dwellings in a development, capped at $30 million per project.

The changes are expected to particularly benefit smaller-scale and regional developments, which often face greater challenges meeting pre-sale requirements imposed by lenders.

Treasurer Daniel Mookhey said the scheme demonstrates how government can use its balance sheet to stimulate housing supply without relying solely on taxpayer-funded grants.

"The Pre-sale Finance Guarantee shows how this Government is using its balance sheet to reduce risk and unlock private investment, enabling new homes to move from design to construction faster," Mookhey said.

"This landmark reform allows us to deliver homes for working families at a lower cost to taxpayers, while also maintaining strong financial discipline."

Planning Minister Paul Scully said the program had already proven effective in bringing stalled projects to market.

"The Pre-sale Finance Guarantee has already proven it can unlock stalled projects and accelerate housing delivery by giving lenders the confidence they need to back good developments," Scully said.

"These changes will allow more affordable housing and smaller developments to access support so more homes can be built faster where communities need them most."

Housing Minister Rose Jackson said the expansion would help community housing providers overcome financing barriers that often delay projects.

"We know community housing providers are ready to build more homes, too often they're held back by barriers to finance," Jackson said.

"Expanding the Pre-sale Finance Guarantee helps remove those barriers so more affordable homes can get off the ground sooner."

The announcement was welcomed by the Property Council of Australia, which has long advocated for measures aimed at improving project feasibility and access to finance.

Property Council NSW Executive Director Katie Stevenson described the expansion as a practical intervention that addresses one of the most immediate constraints on housing delivery.

"This is exactly the kind of practical intervention we need right now, focused on getting projects out of the ground, not just approved," Stevenson said.

"It builds on a model the Property Council has worked closely with government to develop following calls for such a scheme ahead of last year's NSW Budget, so it's great to see it being expanded."

Stevenson said the reforms would help unlock projects that are ready to proceed but have been delayed by financing challenges. However, she noted that broader feasibility issues remain a significant barrier to increasing housing supply.

"The biggest challenge in NSW housing today is delivery. Too many projects have planning approval but are simply not financially viable to proceed under current settings," she said.

Speaking at the Property Council's NSW Housing Summit, Housing Minister Rose Jackson acknowledged that feasibility and financing pressures continue to constrain housing delivery, while reaffirming the government's commitment to work with industry on solutions.

Stevenson said the government's recognition of those challenges was encouraging ahead of next week's state budget.

"It's positive to see the government clearly recognising that feasibility pressures are now a binding constraint on supply," she said.

"With the Budget just days away, the focus must be on backing delivery, making sure projects stack up, finance can flow, and more homes can move from approval to construction."

The expanded Pre-sale Finance Guarantee forms part of the NSW Government's broader housing agenda, which also includes planning reforms, the NSW Housing Pattern Book, and a series of rezonings intended to increase housing capacity across the state.

NSW expands Pre-sale Finance Guarantee to unlock more affordable and regional housing

Design-led developer-builder Lowe Living has unveiled its latest residential development, Jardin House, marking its first foray into Melbourne's blue-chip City of Boroondara.

Located a short walk from Camberwell Junction, <a href="https://www.apartments.com.au/new-apartments/jardin-house-by-lowe-living-camberwell-335-camberwell-road-camberwell-vic-3124">Jardin House</a> has been designed to appeal to affluent local downsizers and established families seeking a low-maintenance alternative to the large homes that have long defined Camberwell and surrounding suburbs.

The project will comprise a collection of two and three-bedroom apartments ranging from 92 sqm to 280 sqm, alongside a limited number of penthouse residences featuring rooftop terraces spanning more than 100 sqm, with optional private pools.

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Lowe Living Co-Founder and Managing Director Tim Lowe said Camberwell represented a natural next step for the developer as it expands into some of Melbourne's most tightly held residential markets.

"Jardin House is an important project for our team as it marks the next evolution of our portfolio into different well-established blue-chip pockets of Melbourne," Lowe said.

"Camberwell, with its incredible walkability, family-led neighbourhood feel and superb access to education and transport, makes it a natural choice for us."

[smartcode_project:default project_id=146717 project_image_fid=372227]

Designed by Tristan Wong Architects, with interiors by Hecker Guthrie and landscaping by Acre, the development takes inspiration from the Art Deco architecture that remains a defining feature of many of Camberwell's established streets.

A curved facade, arched openings, textured brickwork and sculpted forms reference the suburb's architectural heritage, while extensive landscaping softens the building's presence and creates a strong connection to the surrounding tree-lined streetscape.

The project will be set behind a secure gated entrance, with residents arriving through landscaped gardens designed to create a transition between the public realm and private residences.

Inside, the residences feature natural stone and timber finishes, full-height glazing, Miele appliances and generous open-plan living areas designed for long-term owner occupation.

[smartcode_project:default project_id=146717 project_image_fid=372225]

While the apartments themselves have been designed to attract discerning owner-occupiers, it is the amenity offering that sets Jardin House apart from many other boutique projects currently launching across Melbourne.

The centrepiece is a 350 sqm private bathhouse curated in partnership with Aurora Spa &amp; Bathhouse founder Lyndall Mitchell.

The wellness precinct includes mineral pools, hydrotherapy experiences, a Himalayan salt room, sauna, steam room, cold plunge pools and dedicated relaxation spaces, creating what Lowe Living describes as a private wellness retreat exclusively for residents.

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The collaboration follows Lowe Living's recent partnership with Aurora at Maison Savoy in Brighton, although Jardin House is the first project to incorporate both indoor and outdoor wellness experiences.

Emma Lowe, Co-Founder and Managing Director of Lowe Living, said wellness was becoming an increasingly important consideration for apartment buyers.

"Collaborating with Lyndall Mitchell from Aurora Spa &amp; Bathhouse for a second time is an intentional nod to creating residences that are more than just homes, but a way to enrich the lives of our residents through wellness and longevity," Lowe said.

The amenity offering is complemented by a Technogym fitness studio, residents' lounge, private dining spaces and concierge services.

The launch comes as developers increasingly target Melbourne's established eastern suburbs, where rising land values, ageing housing stock and growing downsizer demand are creating opportunities for boutique apartment projects.

Lowe said the company expects significant generational wealth transfer across suburbs such as Camberwell in coming years, creating further demand for luxury apartment living.

"Camberwell is a blue-chip suburb where homes regularly transact for multiple millions of dollars," he said.

"The generational change of wealth in these locations expected in the coming years is significant, so we see an opportunity to create exclusive residences that appeal to older families and downsizers in order to meet this demand."

Apartments at Jardin house start from $1,195,000. The project forms part of Lowe Living's near-$1 billion portfolio of new developments across Melbourne.

[smartcode_project_cta:default project_id=146717]

Lowe Living launches Jardin House in Camberwell

As <a href="https://www.apartments.com.au/developments/north-sydney-nsw-2060">North Sydney</a> continues its transition from a commercial centre into a more layered residential and lifestyle precinct, a new generation of apartment developments is reshaping expectations around scale, amenity, and long-term liveability.

Improved transport connections through the Victoria Cross Metro, continued investment in dining and public spaces, and a constrained supply of new luxury apartments have sharpened demand for homes that combine proximity to the CBD with the privacy and outlook traditionally associated with harbourside houses.

At 177 Walker Street, <a href="https://www.apartments.com.au/developers/aland">ALAND</a>’s new apartment development <a href="https://www.apartments.com.au/new-apartments/the-walden-north-sydney-177-walker-street-north-sydney-nsw-2060">The Walden</a> enters the market with a distinctly residential approach to high-rise living. The 30-level tower will deliver 161 residences, ranging from one-bedroom apartments through to sub-penthouses and a full-floor penthouse, all oriented to capture uninterrupted views across Sydney Harbour, the Opera House, and out toward the Pacific Ocean.

[smartcode_project:default project_id=134323 project_image_fid=6395]

Designed by <a href="https://www.apartments.com.au/architects/rothelowman">Rothelowman</a>, the project takes advantage of the site’s natural topography and elevated position above the harbour. Rather than relying on density alone, the architecture focuses on outlook, orientation, and spatial flow, with every apartment occupying a corner position to maximise natural light and cross ventilation.

Rothelowman says the site itself shaped much of the architectural response.

“The site has a long history in terms of its inevitable transformation and when we came in, we took inspiration from the idea of reestablishing a sense of the site’s natural terrain and fall. Our scheme aims to integrate with the terrain and the landscape, using the undulating site to slowly reveal glimpses and views of the harbour. The rotation of the tower off grid means every apartment has a view and is naturally cross ventilated. The building's colour palette is quintessentially Sydney, with bronze and sandstone and a luminescent green colour in the glass, making it very earthy and grounded in its location.”

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Inside the residences, the emphasis moves toward larger-format living typically associated with standalone homes. Kitchens sit at the centre of the apartments, connecting directly to open-plan dining and living areas before extending outward into expansive winter gardens and balconies. Calacatta marble, bespoke joinery, integrated appliances, and custom metal detailing are used throughout, while three distinct interior palettes, Terrace, Opera, and Harbour, allow buyers to personalise the spaces without compromising the architectural consistency of the project.

The larger residences place particular attention on separation between entertaining and private zones. In many apartments, master suites occupy the outer corners of the floorplates, allowing bedrooms to benefit from floor-to-ceiling glazing and harbour outlooks independent of the living spaces. Dressing rooms and ensuites continue the material palette through fluted detailing, freestanding baths, and layered stone finishes.

Rothelowman says the design intent centred on creating homes that feel enduring rather than transient.

“Our philosophy is all about the way people live in these spaces, and we wanted to create homes that reflect the quality of life in this unique Sydney location. The apartments showcase expansive living spaces that are generous, sophisticated, and bold, with the ability to connect with views throughout each apartment.”

[smartcode_project:default project_id=134323 project_image_fid=353235]

A separate four-storey amenity building known as The Pavilion expands the residential offering beyond the apartments themselves. Positioned alongside the tower, the building consolidates wellness, recreation, and social spaces into a dedicated resident retreat. Facilities include a 20-metre rooftop pool and sundeck, sauna, spa, ice bath, wellness studio, gymnasium, concierge service, wine cellar, residents’ lounge, private dining spaces, and dedicated co-working areas with meeting rooms and boardroom facilities.

The amenity mix reflects the buyer profile emerging in North Sydney, where owner-occupiers and downsizers are increasingly prioritising convenience, apartment scale, and long-term usability over purely investment-driven decisions.

The Walden also represents a significant milestone for ALAND, marking the company’s first major move into Sydney’s inner-city luxury apartment market after more than two decades delivering large-scale residential communities across Greater Sydney. Founder Andrew Hrsto says the Walker Street site stood apart because of both its positioning and its rarity.

[smartcode_project:default project_id=134323 project_image_fid=6390]

“As a company, we had been searching for a site in one of Sydney’s blue-chip locations, spanning the Eastern Suburbs, the Sydney CBD and the North Shore, and when we had the opportunity to purchase this site, we immediately recognised that it could be something iconic.”

At launch, The Walden recorded more than $103 million in sales, with buyers drawn to the project’s harbour positioning, apartment scale, and proximity to the Metro, which now connects North Sydney to Barangaroo in three minutes and Martin Place in five.

ALAND has commenced construction, and is expecting a completion date in 2028.

[smartcode_project_cta:default project_id=134323]

Larry Schlesinger

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