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Today we have run with three charts - Australian dwelling completions, commencements and approvals. The point of this is to illustrate that the current rate cuts are not going to be a job creator for the Australian housing construction industry anytime soon. Naturally it may help other parts of the economy. But not housing construction. To be clear the process of building a property starts at the approval stage. Once approved, building construction commencements normally occur between 6 to 18 months after approvals. And then finally, completions normally occur 18 months to 3 years after approvals.
 
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Dwelling completions are only peaking now and so there are a whole bunch of projects that are on the verge of completion. Normally once a project is completed, workers move onto the next project. But as we can see on the commencements chart, there are now less commencements than completions. And so there is less work available, meaning more job losses are coming. To make matters worse, building approvals are still tracking south and are considerably lower than commencements. This means even more housing construction job losses are on the way over the course of 2020 and likely, 2021. This will happen despite the interest rate cuts, tax cuts and easier lending standards. As the building approvals illustrate, there has been no response as yet in the form of higher demand for new housing. The real jobs creation phase, where there are labourers and contractors on the ground, naturally happens at the commencements phase and gets slowly wound down as the building gets closer to completion. So with the fall off in building approvals, housing construction is going to be a detraction to GDP for many months to come. This must be quite the concern for the RBA and for the Federal Government for that matter. As you may have guessed, housing construction is not an insignificant proportion of total employment. The RBA places it at just under 6%. The last time this occurred was back in 2011 to 2013. However the country still had the mining boom as a major job creator at that time. For now, mining investment seems to have bottomed out and will moderately pick up over the next 12 to 24 months, therefore taking some of the slack. But no one is expecting a massive uplift in mining. There is of course infrastructure and that may help to an extent. Apparently for FY20 some $13 billion dollars has been estimated to be spent on Infrastructure which should at least keep climbing through to 2023. By comparison, there was some $42 billion dollars’ worth of dwellings approved over the 12 months to September 2019. Infrastructure better help with the offset. And perhaps with mining added, it will. The RBA is forecasting the unemployment rate to fall to 5% by 2021. But no-one really knows for sure. Let’s hope they are right. Otherwise Australian unemployment is going to keep rising in 2020 and that won’t be good for anyone.
LOUIS CHRISTOPHER is the CEO of SQM Research.
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Current rate cuts aren't going to be a job creator for housing construction: SQM's Louis Christopher

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EXPERT OBSERVER
Figures released today by SQM Research reveal national residential property listings increased in August by 2.9%, to 325,693 from 316,391 in July 2019.
Compared to 12 months ago, listings were down by 2.1%.
All states experienced an increase in property sales listings over the month, with Melbourne experiencing the highest increase at 6.7% followed by Sydney with a 5.0% increase.
Perth recorded the lowest increase of 1.7% over the month.
Year-on-year Sydney’s listings declined by 15.3%.
Melbourne also declined but by a smaller margin of 1.9%.
Perth and Darwin’s year-on-year listings also saw declines of 4.6% and 3.6% respectively.
All other states recorded increases on their year-on-year listings.
Hobart’s increase was 10.8%, the highest increase in the nation, followed by Canberra with an increase of 10.0%.
August’s counts in part reflect the annual seasonal rise in listings that occur as we enter into the spring period.
It also may represent some return of confidence by vendors especially in the Melbourne and Sydney property markets.
Agents will be pleased to hear the new listings also rose during the month, however, older listings remained fairly stable.
Asking Prices
Capital City asking prices increased marginally by 1.0% for houses but decreased 1.0% for units, over the month to 3 September 2019. Unit asking prices are now $560,500 and houses $928,800.
Compared to a year ago, the capital city asking prices posted declines of 1.5% for houses and declines of 2.3% for units.
Over the month, Melbourne’s house and unit asking prices both increased by 0.1% and 0.4% respectively. Hobart also increased its house and unit prices by 0.5% and 4.2% respectively.
Sydney’s asking prices has increased by 1.7% for houses but declined 1.2% for units. Other states to post asking price increases was Brisbane with a 0.5% for houses but 0.4% decline for units; Perth recorded a 0.6% increase for houses but a 0.8% decline for units. Canberra also managed an increase of 1.6% for houses but a 0.3% decline for units, whilst Adelaide asking prices was stable for houses but declined 0.4% for units.
LOUIS CHRISTOPHER is the CEO of SQM Research.
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National residential listings increased in August: SQM's Louis Christopher

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EXPERT OBSERVATION
SQM Research calculate national residential listings increased by 4.0% in May 2019 to 345,516 from 332,236 in April 2019.
A year-on-year comparison shows listings up by 6.2%.
All states experienced an increase in property sales listings over the month, with Hobart experiencing the highest increase at 7.1%, followed by Adelaide at 6.4% and Canberra 5.6%.  
Perth recorded the lowest increase at 3.9% with Darwin not far behind at 4.0%.
Darwin was the only state to record a year-on-year decline of 1.5%.
The modest monthly increases does not compare to the huge year-on-year increases of 25.0% in Canberra, 21.1% in Melbourne and 15.5% in Hobart.
Year-on-year Sydney managed a 0.7% increase in listings whilst Perth increased from 1.9% to 3.9%.
<a href="https://www.propertyobserver.com.au/images/2019/6/4/sqm%201.png" target="_blank">Click here</a> to enlarge: 
<img src="https://www.urban.com.au/images/2019/6/4/sqm%201.png" alt="">
Source: SQM Research
We were expecting a rise in listings for the month of May given the low numbers recorded in April which was affected by the Federal Election.
May’s counts suggest listings remained elevated for most capital cities, suggesting the month remained largely a buyers’ market.
This view is confirmed by the simultaneous fall in asking prices over the same month.
Asking Prices
Capital City house asking prices decreased marginally by 0.6% and 0.2% for units, for the month to 28 May 2019. 
Unit asking prices are now $558,700 and houses $903,700. Compared to a year ago, the capital city asking prices posted larger declines of 7.4% for houses and 3.7% for units.
Adelaide was the only capital city to record increases over the month in both houses and units at 0.2% and 0.4%respectively.
Sydney continues its decline in house prices with a 0.8% decrease and 0.5% for units over the month.
A house in Sydney is now $1,219,700 and a unit is $683,000. Sydney’s 12 month decline is now 10.5% for houses and 6.0% for units.
Melbourne’s house and unit prices also continued to decline over the month at 0.5% and 0.6% respectively.
Darwin, Hobart and Brisbane’s house prices increased marginally over the month at 1.3%, 0.4% and 0.2% respectively.
However, unit prices declined in Darwin by 1.5%, by 1.0% in Hobart and 0.2% in Brisbane over the month.
<a href="https://www.propertyobserver.com.au/images/2019/6/4/sqm%202.png" target="_blank">Click here</a> to enlarge:
<img src="https://www.urban.com.au/images/2019/6/4/sqm%202.png" alt="">
Louis Christopher is the <a href="http://sqmresearch.com.au/about-us.php" target="_blank">managing director at SQM Research.</a>
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National property listings increased in May: SQM's Louis Christopher

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 Just a quick update on a few thoughts and stats on the market as we start the new property year off this weekend.   Firstly, Sydney and Melbourne valuation points have improved with the price declines but both markets remain heavily overvalued on our favoured measurement, which is house prices to nominal GDP. Both markets could do with another year of price drops. If we were to have it (and we think there will be more price declines), then valuations would at least return to closer longer term trends for Sydney. Melbourne still needs to correct some more. <img src="https://gallery.mailchimp.com/9badbd870addb4af72206c2eb/images/94248197-92c6-4585-87be-a0f3318f26a7.png" data-imagetype="External">
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 Of course, there is a massive difference between where prices ‘should’ be and where they may actually go. All I do know is when housing prices do eventually bottom in this cycle (very unlikely to be this year), the housing bears will no doubt be forecasting (and demanding!) yet more declines. Housing bears are notoriously hopeless in picking housing market bottoms and I can assure you now it will be no different in this cycle! As mentioned, this coming weekend will be the opening of the new auction season for Sydney and Melbourne. We can expect just over 150 auctions in Sydney and around 200 for Melbourne. As each weekend goes by in February, auctions numbers will increase to the point where the market will should reach its full volume on the 2nd of March with about 850 to 1000 Saturday auctions that day for each city.</div>
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<a href="https://www.propertyobserver.com.au/subscribe" target="_blank"><img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2019/1/Subscriber%20strip%20ad.jpg" alt=""></a> As per the opening of each season, auction clearance rates will likely rise from the December lows. I am expecting Sydney to rise back into the late 40s or maybe early 50s after unreported results. While Melbourne may reach the high 50s. Be careful of the media reading too much into this. Some may herald this as a recovery in the housing market.  It won’t be. Just recall this time last year the market opened up with Sydney recording a clearance rates in the high 50s and Melbourne actually touched 70%. No, this downturn still has some legs to run yet. As mentioned above, Sydney and Melbourne remain heavily overvalued despite the price falls that have happened, there is a election just a few months away where negative gearing is at play, and then the banks are still being very draconian on providing loans to the market. But I have noticed one thing – there are more bargain hunters in the market. And the first home buyers are somewhat out. This downturn has been going on for over 18 months now. Its not new any more and the longer it goes for, the more sensitive it will be to any stimulus thrown at it.  APRA have also signalled a reversal of policy. Back prior to Christmas, APRA scrapped its interest only <a id="LPlnk67935" href="https://sqmresearch.us5.list-manage.com/track/click?u=9badbd870addb4af72206c2eb&amp;id=2a328c6fb0&amp;e=0aab96dc54" target="_blank" rel="noopener noreferrer" data-auth="NotApplicable">lending limits</a>, which was in our view the final straw for the market when the interest only limits were brought in earlier 2017.  Speculation is rising that the next move from APRA may well be to lower the 7% buffer threshold to maybe 6% or lower still. This buffer is a minimum servicing requirement that’s of the loan applicant if they could handle an average lending rate of 7%. With average lending rates in the 4s it is now very hard to see a scenario where lending rates lift by some 300 basis points. In the current environment, doing so would probably see revolution on the streets, let alone the deepest housing crash in history.   So, what are our forecast again? <img src="https://gallery.mailchimp.com/9badbd870addb4af72206c2eb/images/d8d04315-ef9c-44aa-9857-46476dcd0c83.png" data-imagetype="External"> Nothing much has changed in our view since the release of our results. We think our base case is very much in play but I do also think the odds have increased just a little more that instead of a possible rate cut later this year, the RBA will lean on APRA as mentioned above. Doing so may well create the same effect as a rate cut which  in turn, just might create a bottom in the current housing downturn, especially if APRA keeps loosening lending restrictions into 2020. Offsetting this view will be fears by investors over the repeal of negative gearing, assuming Labor wins in May plus the ongoing hard core scrutiny of the banks on loan applicants.  For now, there is no rush for buyers to enter into the market. But keep an eye out for easy pickings. We have quite a few distressed listings in our Distressed Property report now. Some 23,000 of them, of which, many vendors are quite negotiable…</div>
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Louis Christopher is the <a href="http://sqmresearch.com.au/about-us.php" target="_blank">managing director at SQM Research.</a> 
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Housing bears are notoriously hopeless in picking housing market bottoms: Louis Christopher

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SQM Research has calculated the national residential vacancy rate was 2.1% in October, with the number of vacancies Australia-wide falling to 67,781.
It was a slight drop on September.
Hobart's vacancy rate fell to a record low of 0.3%, the lowest since SQM started recording data in 2005. 
In Adelaide, the vacancy rate dropped to 1.4% from 1.6% in September and down from 2% a year earlier.
In Canberra, the vacancy rate dropped to 0.8% from 1.0% in September.
In the bigger cities, vacancies fell in Sydney to 12,435 in October, down from 13,114 in September, giving a vacancy rate of 1.9%, down from 2.1% the previous month.  In Melbourne, the vacancy rate fell to 1.8% with 9,390 rental properties available.
Click <a href="https://gallery.mailchimp.com/9badbd870addb4af72206c2eb/images/298d5ea0-09c4-42e3-8c4b-21e4e5134c6a.png" target="_blank">here to enlarge</a>.
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Elsewhere, the vacancy dropped in Perth to 4.1% from 4.5% in October, but is still the highest of any capital city. 
Darwin’s vacancy rate fell from 2.7% to 2.5% over the month.
The vacancy numbers highlighted tighter rental markets in many capital cities.
"We’ve seen big falls in Perth and Adelaide and even Brisbane appears to be recording a slight trend downwards right now," SQM's Louis Christopher said.
"However, we expect vacancies to rise in November and December due to seasonality such as students finishing up their semester and heading home, which may take some pressure off rents."
In Hobart, the shortage of rental accommodation is the most severe, with just 75 properties available for rent in October, prompting a record low vacancy rate of 0.3% and higher asking rents, especially for units which were up 7.9% over the month to 12 November.
Capital city asking rents over the month to 12 November fell 0.4% to $548 a week for houses. Unit asking rents rose 0.2% to $439 a week. Asking house rents jumped the most in Canberra by 2.6% over the month while asking rents for units jumped the most in Hobart by 7.9%. 
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Residential vacancy rate dips in October: SQM Research

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GUEST OBSERVER
Overall, I was disappointed by the lack of substance in the Four Corners program Betting on the House.
Claims were made without backing evidence. Too much was made of individual ‘hard-up’ cases. When will some borrowers understand that it is ultimately your responsibility to work out if you can service a loan or not?! Portraying the basket case of Mandurah as something that could happen to the rest of the country is laughable.
Mandurah, a regional town, approximately 100km south of Perth, has had problems for many years now. All that should be taken from this point is Australia has a mixed housing market where risks are elevated on isolated, regional areas.
Yes, of course, housing prices can and do fall. Perhaps if that point alone needs to be stated out aloud, over and over again, then fair enough. But I got a distinct impression that the implicit message that Mandurah could be a precipitous for something much wider and bigger.
<a href="https://www.propertyobserver.com.au/images/2017/08/24/d490ea71-67d8-464e-a910-da9867f795c4.jpg" target="_blank">Click to enlarge</a>
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Much was made of rising loan defaults and mortgage stress getting to a breaking point. Yet the reality is loan defaults remain at low levels and loan servicing at this stage is not an issue.
Yes, of course, if the RBA lifts rates aggressively, we could have a large correction in the market. For the record, we have been stating this in our Housing Boom and Bust reports for a number of years now. It is a risk that is well and truly acknowledged, not just by myself but by many others including the RBA who recently discussed what would now be regarded as the new “normal interest rate setting”.
<a href="https://www.propertyobserver.com.au/images/2017/08/24/e83fb76d-c4b0-4abf-8b70-6e07809bf536.jpg" target="_blank">Click to enlarge</a>
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Perhaps if there was a more rigorous discussion on this point (where is the new normal for interest rates) that would have been useful. Quite clearly, with the excessive amount of private debt in the economy, a cash rate of say circa 6% would smash the community, which I personally find concerning.
This is not the first time Four Corners has covered the housing market.
In May last year, they ran a story on the market, mainly covering negative gearing but also discussing how the market could pop. They rolled out Steve Keen and Lindsay David.  It was a relatively good piece, overall in comparison.  
Since then, the Liberal Government has gone some way to reforming Negative Gearing by preventing plant and equipment depreciation claim on existing investment properties and cutting out travel expenses. And there also has been further clamp downs on foreign investment activity with reports offshore that the rate of capital outflows from China has significantly slowed.
Yet, the market continues to rise…
Macrobusiness today provided a scoop on the fact that many of the commentators featured in the segment felt that their comments on population growth as being a contributor to an overvalued housing market, was cut out!  If so, this is a disgrace on the part of 4 Corners producers. Let’s just remember, Melbourne’s population is expanding by 120,000 a year or 2.4% pa.
Sydney is rising at 90,000 a year or 1.7% pa. These are massive numbers which are causing some rather obvious issues on housing and creating a strain on our existing infrastructure with long term ramifications for our natural resources.
Excessive population growth, while not the sole reason, is most certainly a large reason why Sydney and Melbourne housing markets are massively overvalued right now and yet are not correcting despite macro prudential action which has included interest rate rises on investors.  
If there cannot be a public discussion on this issue than this country has some real problems.
Louis Christopher is managing director of SQM Research. He can be contacted <a href="https://www.sqmresearch.com.au/" target="_blank">here</a>.
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Four Corners episode too light on: Louis Christopher

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GUEST OBSERVER
Here's my opinion on the possible effects of the markets based on Labor’s policy proposal. We might make a further assessment once we see more details from the Libs. 
Lets consider some of the fears that have been raised by various lobby groups who have argued both for and against.
Would there be a surge in rents?
In our opinion, we think no. And that is based on what happened in history as well as the fact that if Labor’s policy passed, it would keep negative gearing on new property.
Lets first consider history.
<a href="/images/2016/02/17/48566a79-6a5d-4f00-af6e-21b7564fd5b6.png" target="_blank">Click to enlarge</a>
<img src="/images/2016/02/17/48566a79-6a5d-4f00-af6e-21b7564fd5b6.png" alt="">
As most of you are aware, Negative gearing was briefly scrapped by Paul Keating (As Federal Treasurer), Starting July 1985. It was then restated in Mid 1987.
As the chart illustrates, while rents were rising, certainly there was no spike in rental growth rates over that time. Indeed rental growth rates were returning back to be in line with the CPI rises recorded over that period. Rental growth rates were slower than what was recorded in the early eighties.
Post the period, rents did accelerate, however so was inflation as the economy entered into an overheated period post the stock market crash of 1987. Rental growth rate completely feel away as the economy entered into recession in 1990. At no time during this period did rents fall, and that is because overall inflation in the 80s was still relatively elevated. Rents and inflation have historically been closely correlated.
For those who are interested in the city by city break up over this time, ABC Fact Check compiled an accurate story last year.
As is illustrated by ABC most of the rises this time were primarily driven from Sydney and Perth with vacancy rates in these two cities already low prior to the scrapping of Negative Gearing.
Of course, the period 1985 to 1987 was a turbulent period for the economy and major economic reform. We had the slump in the Australian dollar caused by a blow out in our current account deficit, a deregulated financial sector, a stock market boom, followed by the almighty crash of October 1987. It was indeed the roaring eighties.
In this regard, we think the evidence of a spike in rents, directly attributed to the scrapping of negative gearing is scratchy at best. And worse, it is misleading.
But just in case there is a relationship there, Labors' proposal to keep negative gearing on new properties would most likely ensure a strong supply side response to the market. We have seen such directed stimulus work on the markets before, namely in the form of various first home owner grants, so we are confident, the market is responsive to such stimulus. 
A surge, followed by a slump in the market?
This would have to be one of the largest risks in Labor’s proposal. As the cross over date approaches at 1 July 2017, I believe there is a risk of  a surge in investor demand for existing property to take advantage of the grandfathering provisions. Then once the date is reached, a subsequent slump could occur by the drop off in demand from investors. Once again, this is not without its precedent. This phenomena occurred during the introduction of the GST and it also happened when the first home owners grants were repealed in 2003 and 2010.
Of course, this scenario is not guaranteed, and yes, there is a chance investors would see through the ramification of such a possible slump, and then therefore hold off buying on mass. But somehow I think the animal spirits are likely to take over as they have done the past. This risk certainly cannot be completely ruled out.
A solution to this is a scaling out of concessions on existing property over a period of time. I think for example a two year phase out period would do much to reduce this risk.
New properties record a price surge. But on resale would be discounted. 
We believe it is likely that a surge in demand for new properties would see an additional premium placed on such properties compared to the existing market. In our experience, off-the-plan developments, particularly for multi-story apartments come on at an average 20% premium to comparable existing units. Arguably this happens due to the ‘new’ nature of the product compared to existing properties which have older fixtures and fittings. This premium is eventually reduced to over time as ‘wear-and-tear’ develops on the property.
What may happen though is that the “20%” premium may further increase as demand surges. Remember, developers are always trying to maximise profit margin and there is no better way to do that then to lift the price! This would not be a desirable event at all as it would increase the chances of considerable investor capital losses on any resale, especially within the first five years of the life of the property. Remember, secondary purchasers will not be able to access the negative gearing benefits once the property is resold back into the market.
I also cant help myself scoff at the recent claim by Chris Bowen when he said
“Investing in a new property is not in any sense more risky than buying an existing property.”
Take it from me as someone that has assessed, analysed, owned, sold real estate of various property types over the years, new property is more risky than existing property. Lets just start with contract risk.
Has anyone read all the rescinded contracts that have taken place in Sydney last year over sunset clauses? Has anyone been reading on the appalling resale rates in areas such as Docklands over the years? Is anyone aware that quite a few builders/developers have gone belly up over the years?
Likely Scenario – An adjustment phase with some periodical distortions in the market, but no rent spikes.
We believe that should Labor’s proposal succeed there would be an adjustment period where, yes, many investors may stay away from existing property for a period of time, but only until such time that a rise in yields gives them incentive to start buying existing properties again. This would happen as investors would demand a higher yield to offset the lack of tax concessions.
But such a period would not go on forever. Once yields are higher, investors would then re-enter the market. Potentially yields could rise to the point where existing residential properties are cash-flow positive from day one, or at least, cash flow neutral. Which I believe would be a positive for the asset class over the long run.
For those advocating for a return to better value on residential property, the reduction in negative gearing concession may well trigger this process. 
But this adjustment does not necessarily mean there would be an outright “decimation of the market”. We may well likely see for example a period of stagnation in property prices for existing property. Or prices rising more slowly than rents.
I suspect the outcome here would be reliant on interest rate settings and the overall health of the economy. But to ensure such a more stable outcome, we do strongly suggest to Labor that a scaling out approach is a safer strategy. 
Louis Christopher is managing director, SQM Research and can be contacted <a href="https://www.sqmresearch.com.au/index.php" target="_blank">here</a>.
{mijopolls 130}
 
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No rent spikes or market decimation under Labor's negative gearing: Louis Christopher

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GUEST OBSERVER
The forecasts verses actuals reveal the nation outside Sydney is recording slightly weaker growth than we expected and Sydney is recording more robust growth than what we expected for this year. 
Why?
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<li>The mining downturn is having a considerable impact in a number of cities.</li>
<li>Listings remain well supplied, particularly in Brisbane, which itself has been a victim of the downturn, represented by higher than average unemployment (particuarly white collar) and manifested through high CBD offices (and residential vacancy rates).</li>
<li>The second rate cut of May 2015 was not built into our forecast. As a result Sydney has risen faster than our more optimistic expectations.  </li>
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<img src="/images/2015/09/02/Screen%20Shot%202015-09-02%20at%209.22.51%20AM.png" alt="">
Note our forecast was for dwellings based on the ABS data. The ABS is not reporting for the June quarter until the end of September so we have decided to use the APM data on the interim. Our base case scenario became redundant once rates were cut in February and the dollar sank below $U.S 85 cents (December 2014). That put Scenario Two squarely in focus which was for more robust growth with Sydney leading the charge once again at 11-15%. We formally updated the market about this change at the end of March. By all accounts, Sydney has done more than our forecasts so far this year. The second rate cut of May ensured this with property investors entering into a frenzy that shot the average Sydney house up by an estimated $50,000 in just a few short weeks. Literally, the market ‘gapped up’. Since then I get the impression the market is still testing those highs and is struggling to move much further. This is illustrated by lower auction clearance rates recorded in the past 8 weeks then the preceding period. Going forward, clearance rates will fall in Spring (as they always seasonally do). Most likely they will fall to the mid 60s. If they so happen to fall below 60% then something more negative is going on. Otherwise it will be just a very normal Sydney market. While we believed Perth was at a higher risk of a correction, we still believed the probabilities were that Perth would largely flatline on the basis that rate cuts would provide a soft landing. The rate cuts have provided a soft landing of sorts, but not to the point of stopping a correction. Perth dwelling prices are now falling. This is showing up in the APM numbers AND our own asking prices, which suggests vendors have lowered their asking prices on average by 4% over the past 12 months. While downplaying other bullish forecasts for Brisbane in 2014, we did lift our forecasts for 2015. However Brisbane is proving to be largely flat-lining this year as well. The reality is underlying demand in Brisbane remains sluggish and investor related demand also soft. The total housing finance approvals chart for Queensland illustrates this story. Yes there has been a little pick since the downturn of 2010-2012 however this year housing finance approvals have been flat.
<a href="/images/2015/09/02/27fe3292-d0ce-4db3-a78a-e4917ca42a9c.png" target="_blank">Click to enlarge</a>
<img src="/images/2015/09/02/27fe3292-d0ce-4db3-a78a-e4917ca42a9c.png" alt="">
The end result is still more sellers than buyers in the market and this can be clearly seen on our stock on market index for the city. Until such time as there is a definite trend of declining stock, it is hard to see how Brisbane is going to record any substantial rise in prices, let alone a new property boom.  It is a similar story for Adelaide and Hobart, however we still remain more bullish on Hobart and think activity is increasing<a href="https://sqmresearch.us5.list-manage.com/track/click?u=9badbd870addb4af72206c2eb&amp;id=ba8e44005c&amp;e=0aab96dc54" target="_blank"></a>. Nevertheless outside Sydney and Melbourne, it is indeed a patchy market. This present climate comes with investor credit lending now slowing, potentially as a result of APRA’s actions. APRA has very recently stated it is now going to take a wait-and-see approach to the market. As APRA has now flexed its muscles and proved itself to be a key influencer on the housing market, it is interesting to note APRA’s current view of the world as presented last week, by the organisation’s chairman.   In short:
<ul>
<li>APRA believe that that housing portfolio risk profiles might have increased, and underwriting standards have “softened”, over time.</li>
<li>They believe house prices are “high” in areas outside Sydney and Melbourne.</li>
<li>They are largely leaving up to the Approved Deposit Institutions (Banks etc) to determine how best to meet APRA’s 10% investor lending annualised growth rate threshold should be applied.</li>
<li>They have left the door open to policies focussed on specific cities but for now will not employ such policies.</li>
</ul>
Perhaps the best way to gauge whether they will take further action down the track is by watching Investor housing credit which is published by the RBA. The latest result came out yesterday, which recorded a 0.6% increase in this measure. This was welcome news as the month result is below the annualised threshold of 10% growth set by APRA with some pundits claiming this is evidence of the APRA initiatives now working. One way, or the other, it appears APRA are intent on keeping investor credit growth below their stated 10% threshold. Given that it has been investors that have predominantly driven the housing market upward since 2012 there are ramifications for this policy. And that is slower housing price growth at the national level for next year. The magnitude of which we will explore in our 2015/2016 Housing Boom and Bust report, which is due to be released again later in September. On the interim, we will shortly be releasing a GOLD Coast outlook report including an assessment rating. That should be out on our website in time for next week’s newsletter. Needless to say, we have become rather bullish on the<a href="https://sqmresearch.us5.list-manage2.com/track/click?u=9badbd870addb4af72206c2eb&amp;id=8decbe51c1&amp;e=0aab96dc54" target="_blank"> </a>Coast.
Louis Christopher is property analyst for SQM Research. He can be contacted <a href="https://www.sqmresearch.com.au/" target="_blank">here</a>. 
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How do we fare compared to last year’s Housing Boom and Bust report? SQM's Louis Christopher

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<div>GUEST OBSERVATION</div>
<div> </div>
<div>Over the last three weeks. And in the last week in particular, there have been some key announcements that will likely have a meaningful impact upon the housing market. The screws have been further tightened and this time we think they will have an impact. To recap the major changes include:</div>
<ul>
<li>A requirement for banks to hold 2% more capital (compared to risk weighted assets).</li>
<li>A requirement for banks to lift risk weights on home loans, meaning the banks will not be able to leverage as much from their home loan assets as they were before.</li>
</ul>
<div>Banks have responded by:</div>
<ul>
<li>Announcing capital raises</li>
<li>Lifting interest rates on investment property loans</li>
<li>Reducing loan to value ratios on investment property loans and locations considered higher risk</li>
<li>Increasing the servicing requirements (e.g A loan service test on a higher theoretical interest rate).</li>
<li>Not allowing tax benefits from negative gearing to be used as income.</li>
</ul>
<div>Clearly the changes will knock out most of the weaker borrowers, which is what the changes are designed to do, besides strengthen the balance sheets of the banks. But will it move existing property investors to the exits? The cumulative effect of these changes will now most likely dampen demand from property investors. The announcement last week of interest rate increases was probably the final nail. Indeed trusted sources on the ground including agents and mortgage brokers in Sydney are informing me of would-buyers now holding back. We also note the recent decline in Sydney auction clearance rates to just back below 80%. Nevertheless clearance rates in the mid to high 70's is still suggestive of strong market. It should also be noted that SQM expects total residential property listings have surged in July, though the final result will not be known until early August. As we know the recovery in the housing market, particularly for Sydney has been investor driven. It’s a good time to re-publish the following chart which does clearly illustrate how investor have dominated this recovery. </div>
<div> </div>
<div><a href="/images/2015/07/28/HousingFinanceCommitmentsJuly2015.png" target="_blank">Click to enlarge</a></div>
<div> </div>
<div><img src="/images/2015/07/28/HousingFinanceCommitmentsJuly2015.png" alt=""></div>
<div> </div>
<div>
The problem is, property investors can be a fickle bunch. A number of them are momentum driven. Buy when the market is moving higher and sell when the market is heading lower. Forget about the fundamentals and the emotional attachment. It is the capital gain and preservation of that gain that counts. Contrast this with first home buyers and owner occupiers who tend to not care (as much) for the market ups and downs. They tend to be longer term holders. They tend to sell and buy on an upgrade/downgrade or when servicing improves/deteriorates.This makes for a market they may well be more volatile than previous cycles. Even so, is there enough here to create a full blown crash? No way. We would still need to see a lot more action from the banking sector than these initiatives before that happens. I believe rates would need to go up by at least 1.5% and at a time when there is some type of massive supply overhang on new stock. Neither seems likely at this point in time. Needless to say the probabilities have now rapidly increased of a housing market slowdown which could be commencing now. 
</div>
<div> </div>
<div>Louis Christopher is property analyst for SQM Research. He can be contacted <a href="https://www.sqmresearch.com.au" target="_blank">here</a>.</div>
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The slowdown we're going to have: Louis Christopher

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<div>
SQM's top 10 discounted properties have four located in Western Australia, and these four properties are clear examples of the continued impact of the commodities downturn.
Set in the rural town of Carabooda, number five and six on the list are not your typical family homes.
Sitting 48km outside of Perth CBD, both properties are set on over 15 hectares, with the potential to live and earn a living of the land.
Interestingly, both properties have been on the market for the same amount of time, however, number five, 292 Carabooda Road, as been reduced by two more percentage points, a total saving of $618,000. 
In contrast to these rural beauties, number eight and nine on our list are suitable for buyers wanting to be pampered and live in and close to Perth City.
Number eight, 4/134 Marine Parade, Cottesloe, has been on the market over two years now with the vendor slashing the price by $950,000.
With a reduction of just under a million dollars, this property is clearly a bargain.
Comparatively, number ten on our list 11/580 Hay Street, Perth, has recently passed the one year mark on the market, with the vendor slashing the price by half a million dollars.
</div>
<img src="/images/2015/06/17/sqmfallback2.jpg" alt="">
 Loius Christopher is an indépendant property analyst for SQM. You can follow him on twitter <a href="https://twitter.com/louichristopher" target="_blank">here</a>.
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Mining boom downturn triggers four WA offerings on SQM top discounted list 

There are few property developers nationally that can boast a workbook like the ASX-listed developer Cedar Woods. With eight apartment buildings under construction across four states, Cedar Woods is well positioned to take advantage of what Managing Director Nathan Blackburne says is a “national shortage of apartments.”

Cedar Woods purposefully has a diversified portfolio of apartments, townhouses, commercial, and residential communities across the country, enabling the business to remain resilient through market cycles and respond to shifting buyer demand.

Blackburne says there is a great shortfall of housing of all typologies, none more so for apartments. He says that is the case particularly in Perth, where the lack of new apartment projects has been particularly acute.

“Perth has been more affected than Melbourne,” Blackburne explains, noting that over the past five years, “very few new apartment projects” have been launched in either city. Historically, apartments made up around 20 per cent of new housing nationally. Cedar Woods estimates that figure has fallen to around 10 per cent today, a gap they believe must close.

<h2>Apartment appeal rebounding as supply shrinks</h2>

There are signs the tide is turning however. Blackburne says buyer apartment sentiment really picked up in mid 2025. “In October we saw our strongest sales month for apartments in Perth.” The buyer demand has driven their Subiaco apartment development, Incontro, to nearly 70 per cent sold. The increased buyer sentiment has strengthened Cedar Woods’ confidence in bringing forward the next apartment project in Western Australia, a three tower development planned for the prime site on Upham Street in Subiaco, adjacent to Incontro.

Demand is being driven by several factors; the lack of new apartments coming to the market, the increased demand with migration far outstripping the aforementioned supply, and the appetite to live closer to the city.

“Over the past three years, Perth’s population has grown by around 250,000 people, while only around 50,000 dwellings have been delivered,” Blackburne says, adding that more than twice that number would be needed just to keep up.&nbsp;

He said that many buyers are being forced to the urban fringe because of the greater supply of land product, but that, Blackburne argues, is pushing the fringe further out and motivating a re-evaluation of the value of inner- and middle-suburb apartments.

Demographic shifts are helping drive this rethink. Cedar Woods is seeing more boomers downsizing, young professionals entering the market, and a rising number of single-person households. There’s also a growing trend of parents buying apartments for teenage children, motivated by fears that housing prices will become out of reach. “It’s not only a strong investment now, but it can serve as a first home when their children move out.”

<h2>National diversification strategy</h2>

Cedar Woods’ strategy is not limited to Perth. Blackburne outlines their aim to diversify by price point, product type, and geography, which “gives us a broad customer base and smoother earnings profile.” Throughout their markets, they’re combining apartments, townhouses, and masterplanned communities, allowing flexibility to pivot toward undersupplied segments as demand evolves.

In Victoria, Cedar Woods is pressing ahead with a major site in Fairfield, just northeast of Melbourne’s CBD, a site which Blackburne says the company has had its sights on for many years. They are planning to deliver three towers with over 300 apartments, with the plans likely to be submitted in early 2026.

Blackburne also expresses optimism about broader inner-Melbourne supply dynamics. 
 
“While Melbourne’s apartment market is better supplied than Perth’s, and population growth remains strong, Cedar Woods believes the current stock will be absorbed quickly,” Blackburne says, however he warns that policy disincentives remain. “In Victoria … there are quite a lot of obstacles for apartment buyers,” he says, adding that the industry is working with the state government to “remove those barriers” and avert prolonged undersupply.

Cedar Woods has plans on the desks of the VIC Government to develop a 20-storey tower in Southbank, in the heart of Melbourne’s arts precinct. Designed by Rothelowman, the proposed tower will deliver 180 apartments, ranging from studios to three-bedrooms, along with creative amenity space devoted to arts and digital industries, a food and drink tenancy at street level, and a 700sqm recreation deck with indoor lounge space will provide a resident amenity hub.

Blackburne frames the project as a response to Melbourne’s growing undersupply of signature inner-city living. “We saw a thematic: a looming undersupply in inner-Melbourne, particularly in high-quality apartments, and wanted to capitalise on that,” he says. The site’s proximity to the Melbourne Arts Precinct, key tram lines, and Southbank’s cultural fabric makes it especially appealing, Blackburne says.

<h2>Charting the course forward</h2>

On top of the apartment developments underway and planned in Perth and Melbourne, Cedar Woods has a multi-stage apartment development in Brisbane’s Woolloowin, and several years remaining on their masterplanned communities in Williams Landing in Melbourne and Glenside in Adelaide, both of which offer a mix of apartments and townhouses.

Blackburne says the developer has been able to mitigate some of the macro risks currently at play in the new development space, particularly in the construction sector.

“Cedar Woods has been able to make many apartment projects work because of good buying of the raw land in the first place, as well as its strong pipeline of apartment projects, enabling the company to attract builders to build deep, multi-year relationships.”&nbsp;

For Cedar Woods, 2026 is set to be significant, with anticipated approvals and submissions laying the groundwork for fresh apartment supply and multiple launches in 2027.

&nbsp;

Joel Robinson

Cedar Woods ramps up apartment development amid Australia’s deepening housing shortfall

Rockdale has long been characterized as a suburb on the cusp. Well-located, well-connected, but historically underserved by modern apartment offerings.

It has everything going for it: outstanding connectivity to the Sydney CBD, just four train stops to Central Station, strong local amenity anchored by Roc​kdale Plaza and a growing main-street dining scene, and enviable proximity to Brighton-Le-Sands. The six-kilometre beachfront is lined with bayside restaurants, cafés, and walking paths, giving residents a lifestyle typically associated with much more expensive coastal suburbs.

What Rock​dale has lacked is high-quality contemporary apartments. Most existing developments date back several decades, with floorplans that no longer support modern living needs, and buildings constructed long before today’s standards in engineering, efficiency, and sustainability.

Lender, fund manager and apartment developer Princeton identified the gap early. Seeing all the right ingredients in Rockd​ale, transport, lifestyle, retail, and affordability, they set out to deliver what the suburb was missing. Their answer is <a href="https://www.apartments.com.au/new-apartments/marque-rockdale-602-608-princes-highway-rockdale-nsw-2216">Marque Rockdale</a>, a collection of 58 one-, two-, and three-bedroom apartments now nearing completion just a short walk from Ro​ckdale Plaza, home to over 50 specialist retailers and anchored by&nbsp;Woolworths, Big W and Aldi.

[smartcode_project:default project_id=136442 project_image_fid=355216]

Understanding they would be resetting the benchmark for the area, Princeton focused on ensuring buyers received best-in-class quality, longevity, and protection.

A major step was securing the sought-after Latent Defects Insurance policy from Resilience Insurance. This policy protects apartment buyers from structural or waterproofing defects for the first 10 years of the building’s lifecycle. Crucially, it is first-response insurance, meaning that if an issue arises, the insurer pays immediately for remediation—rather than waiting for lengthy investigations to determine fault before work can begin. For purchasers, it offers an unprecedented layer of security rarely seen in Sydney apartment projects.

During construction, independent building inspection firm SDSS has been providing Technical Inspection Services, bringing highly specialised construction experts on-site at key stages to ensure workmanship meets the highest standards. The project is being built by Coplex, an iCIRT-rated construction company, and throughout the build SDSS has frequently referred to <a href="https://www.apartments.com.au/new-apartments/marque-rockdale-602-608-princes-highway-rockdale-nsw-2216">Marque Rockdale</a> as one of the best projects currently on their books.

Princeton also doubled down on comfort, acoustics, and livability.&nbsp;As well as being the only building along Princes Highway with a landscaped buffer between the building and the road, Princeton has purposefully included double-glazed windows in all apartments to reduce noise.

Apartments feature double-glazed, noise-reducing windows and ducted air conditioning in every residence.&nbsp;In addition to the project’s transport convenience, Princeton has partnered with GoGet Car Share to provide a dedicated GoGet vehicle housed permanently within the building. Residents will receive a free annual GoGet membership, paying only usage fees, offering a flexible alternative to owning a second car and enhancing the project’s sustainability credentials.

[smartcode_project:default project_id=136442 project_image_fid=277075]

Residents will enjoy an exclusive rooftop oasis, purpose-designed as an extension of their living space. The communal rooftop includes BBQ facilities and outdoor entertaining areas, a&nbsp;pergola-shaded dining zone, a dedicated children’s play space, and a landscaped herb garden.

Princeton and Coplex is approaching completion of <a href="https://www.apartments.com.au/new-apartments/marque-rockdale-602-608-princes-highway-rockdale-nsw-2216">Marque Rockdale</a>, and are expecting residents to move in early in the new year. The mix of apartment configurations and price points have been a hit with young professionals, those who need to commute to the CBD, and families who appreciate doorstep amenity.

“Marque is a place where residents will be proud to call it home," Princeton Head of Development George Young says.

"We’ve worked really hard with Coplex and our design team to deliver an incredible building for the future home owners to make their own. The homes are all designed to allow the residents to make it their own, a place to belong and live a stylish urban life."

[smartcode_project_cta:default project_id=136442]

Marque Rockdale sets a new standard of apartment living in Sydney's south

Plans to revitalize the&nbsp;long-established Benowa Gardens Shopping Centre into a mixed-use community combining living, shopping, dining, health and wellbeing facilities, have been proposed to the Gold Coast City Council.

The Benowa Gardens Urban Village proposal by Benowa Gardens Holdings seeks to transform the 17,660 sqm site at <a href="https://www.apartments.com.au/new-apartments/203-ashmore-road-benowa-qld-4217">203 Ashmore Road</a> into a contemporary, sustainable destination that reflects global trends in modern community design while retaining the familiar local character residents value.

The site is bordered by Ashmore and Benowa Roads and Carrara, with ready access to Pindara private hospital, four schools, TAFE, sports fields and the nearby Botanic Gardens.

Benowa Gardens Holdings is seeking a preliminary Council approval only for its proposed masterplan and variations to the site’s Neighbourhood Centre zoning.&nbsp; 
Formal Public Exhibition commenced Friday and also marks the start of comprehensive community consultation with surroundings residents, schools, P&amp;Cs, existing retailers, nearby sporting clubs, arts groups and Botanic Gardens volunteers.

Designed by Neylan Architecture, the masterplan envisions around 413 new apartments, complemented by upgraded retail, dining, and wellness amenities as part of 10,000 sqm of retail, and 9,630 sqm of office space/medical suites.

The development will feature green open spaces, shaded promenades, landscaped terraces, pedestrian walkways, and expanded healthcare and lifestyle services in synergy with the neighbouring Pindara Private Hospital and local schools.

<img alt="Benowa" data-entity-type="file" data-entity-uuid="244f4d54-2e67-4141-92b8-78d5735f47c2" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202025-11-26%20at%2012.47.34%E2%80%AFPM.png?VersionId=FmF5lzhpwVZc7POsdB770TJ_Bf2c0od8" />

“This concept embraces the way people increasingly want to live - safely, conveniently, and within strong local communities,” said Patrick Lu, Director of Benowa Gardens Holding.

“Benowa Gardens will set a new benchmark for integrated living on the Gold Coast. It’s a thoughtful, community-minded evolution that brings global best practice in urban design to one of the city’s most established areas.”

Lu said this isn’t just a redevelopment, it’s a renewal with purpose.

“Benowa Gardens has served the community for decades. Our goal is to ensure it continues to do so for generations to come, as a lively, connected Urban Village where people can truly live, work and thrive. We’re already talking to school leaders and the community to seek their feedback on our proposal, and have taken on board their ideas to improve student safety with additional “traffic calming” measures on Carrara Street. We’re conducting meaningful and sincere consultations and want to play our role in preserving and enhancing the local community."

The proposed redevelopment aims to deliver tangible benefits across the Benowa and wider Gold Coast community, including:

<ul>
	<li>Improvement of retail amenity, to capture the under-served local market demand and keep the local business at their local shopping centre.</li>
	<li>Housing diversity; offering a range of apartment types for key workers, downsizers, and local families who wish to remain in the area.</li>
	<li>Enhanced shopping and dining; revitalised retail spaces designed to support local businesses and attract more visitors.</li>
	<li>Health and wellbeing access; additional medical and wellness amenities to complement existing local facilities.</li>
	<li>Improved traffic flow and access; two new access points, upgraded intersections, upgrade pedestrian pathway’s signal and proposed upgrade of pedestrian and cycle connections/space to improve safety and convenience, especially for school children.</li>
	<li>Environmental sustainability; energy-efficient design, green rooftops, and water-sensitive landscaping to reduce emissions and enhance comfort.</li>
	<li>Local jobs and investment; supporting hundreds of construction and long-term roles while stimulating local economic growth.</li>
</ul>

The group behind the project boasts extensive experience in the property development industry, both in Australia and international markets. Over the past 23 years, the group has been involved in the development and management of a diverse portfolio of assets including residential dwellings, shopping centres, bulky-goods stores, community and medical facilities, childcare centres, offices, hotels, and taverns, across Brisbane, Ipswich, and the Gold Coast.

Benowa Gardens to become new mixed-use urban village

Demand for townhouses in Melbourne’s inner west has surged as buyers seek the elusive combination of space, affordability, and location.&nbsp;

With family-first apartments increasingly rare and standalone homes often out of reach, townhouses have emerged as the new sweet spot, delivering generous living areas with lower maintenance needs within close proximity to the Melbourne CBD.&nbsp;

<a href="https://www.apartments.com.au/new-townhouses/kings-lane-south-kingsville-50-58-new-street-south-kingsville-vic-3015">Kings Lane</a>, the new under-construction townhouse development by the family-owned developer&nbsp;<a href="https://www.apartments.com.au/developers/blue-run">Blue Run</a>&nbsp;in South Kingsville, responds directly to this trend. Comprising just 25 residences designed by <a href="https://www.apartments.com.au/architects/rothelowman">Rothelowman</a>, the project offers a compelling alternative to both apartment downsizers and family upsizers. With three-bedroom homes priced under $1 million, it presents one of the area’s rare attainable pathways to townhouse living less than eight kilometres from the CBD.

[smartcode_project:default project_id=145042 project_image_fid=355147]

<a href="https://www.apartments.com.au/developments/south-kingsville-vic-3015">South Kingsville</a> itself is quietly becoming one of Melbourne’s most dynamic pockets of urban renewal. Flanked by the established appeal of Yarraville, Newport and Williamstown, the suburb balances quiet, village-like streetscapes with major infrastructure upgrades and a growing slate of retail, dining and lifestyle amenity.&nbsp;

Kings Lane occupies a well-connected site at 50–58 New Street, just off Blackshaws Road and within walking distance of the emerging Union Quarter precinct, a major retail destination anchored by Woolworths, specialty food outlets and wellness services.

A 400-metre stroll brings residents to the Vernon Street shops, a local favourite known for its mix of independent grocers, cafes and family-run eateries. For broader shopping options, Altona Gate Shopping Centre and Yarraville Square are both within a short drive. Spotswood IGA and the Williamstown retail strip further broaden the convenience of daily essentials.

[smartcode_project:default project_id=145042 project_image_fid=355139]

Dining options in the area lean toward eclectic and community-driven, with standouts like Rocco’s Deli, Dad and Dave’s, and Pizza d’ASPORTO offering a range of casual and elevated menus. Cafés such as Hudson Road Wine &amp; Beer and Blacksheep Coffee add to the lively yet local feel of the neighbourhood.

Green space is another hallmark of life at Kings Lane. Edwards Reserve is close enough for morning walks or casual sport, while larger parks like Newport Lakes, Yarraville Gardens, and Cruickshank Park are all a few minutes’ drive away. More than half of the nine-hectares of new green space or parkland being created as part of the West Gate tunnel works is located just at the end of New Street, the same street as Kings Lane.

&nbsp;

For those with school-age children, South Kingsville is home to a range of quality childcare centres and schools, including Kingsville Primary, Spotswood Primary, and Williamstown North Primary. Community Children’s childcare and South Kingsville Preschool are nearby, making the suburb particularly attractive to young families.

Transport links continue to improve, with Spotswood Station and the West Gate Freeway both within a five-minute radius. Future upgrades, including the proposed sky rail for Newport and Spotswood, and the delivery of the West Gate Tunnel project, promise even better access to the CBD and Melbourne Airport in the years to come.

Kings Lane's 25 all-electric townhouses are currently under construction, and will complete in late 2026.

[smartcode_project_cta:default project_id=145042]

Staff Writer

Kings Lane townhouses offers rare value in Melbourne's thriving inner west

Developer-builder <a href="https://www.apartments.com.au/developers/billbergia">Billbergia</a> has set a new apartment price record for <a href="https://www.apartments.com.au/developments/rhodes-nsw-2138">Rhodes</a>, a suburb the company has been instrumental in transforming over the past two decades.

The milestone follows the delivery of thousands of apartments across the harbourside peninsula, culminating in the $4.5 million sale of a 220 sqm penthouse in the <a href="https://www.apartments.com.au/buildings/rhodes-central-oasis-39-marquet-street-rhodes-nsw-2138">Rhodes Central Oasis</a> building, which Billbergia completed earlier this year. It is the first apartment in Rhodes to surpass not only the $4 million mark for settled sales, but also the $3 million mark, eclipsing the previous $2.75 million record set in 2021.

The purchaser had originally secured several apartments in the 40-storey tower off the plan as investments. During settlement, she spent more time in the Rhodes area and was so impressed with the building that she decided to downsize from her Northbridge home into the four-bedroom plus MPR penthouse.

The sale underscores the long-term work Billbergia has undertaken in Rhodes since the early 2000s. The company, rated 4.5 Gold Stars under the NSW iCIRT system, identifying it as one of the state’s most trustworthy and financially secure developers, was a pioneer of the area’s urban renewal. What was once a heavily industrial waterfront has become one of Sydney’s most successful examples of transit-oriented development.

<img alt="Billbergia" data-entity-type="file" data-entity-uuid="56093d7f-db18-42f4-bf9b-115bdf76f5f3" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202025-11-26%20at%2011.10.06%E2%80%AFAM.png?VersionId=pca77Mr.H83nwXbJexmaLUAqBewtQ7d9" />

Billbergia is now driving the peninsula’s next major evolution: the most ambitious project in its nearly four-decade history. They are planning the Rhodes Bay Masterplan, an eight-tower, mixed-use precinct on Leeds Street. Currently with the NSW Government’s Housing Delivery Authority which is now championing large-scale projects across the state, the Rhodes Bay Masterplan lays the groundwork for a generational reshaping of this important pocket of Sydney’s Inner West.

The masterplan spans more than 31,000 sqm of amalgamated industrial land along the foreshore, land that has been privately held and inaccessible to the community for more than a century. According to Billbergia’s Development Director, Saul Moran, reclaiming this land for public use is central to the company’s vision. 
 
“What’s so exciting is that we have over 300 metres of privately-held industrialised waterfront, land that’s been locked away for more than 100 years, which we’re bringing back to the community,” he says. “It’s taken many years to assemble sites like these, and the goal now is to transform them into meaningful public space where new homes can be built in an integrated, amenity-rich setting.”

At full completion, the Rhodes Bay Masterplan is expected to deliver over 2000 apartments, with the first 1000 to be completed by 2029. Billbergia’s design focused on nine slender towers, so they could give back more to the ground plane. There will be more than 16,000sq m of new parkland and recreation space, including sports fields, a foreshore play area and waterfront green links. Around 14,600 sqm of retail is also proposed, extending the precinct’s role as a true mixed-use hub.

<img alt="Rhodes Bay" data-entity-type="file" data-entity-uuid="240ffc41-4f26-421a-9606-5c56f6fc2d93" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202025-11-26%20at%2011.05.48%E2%80%AFAM.png?VersionId=BkBxZr7S8CAt1vgNa8AF3zjdc3YuVh0L" />

“Density only works when it’s paired with amenity, transport and open space, and that’s what’s made Rhodes such an amazing success story,” Moran says, adding that the demographic shift Billbergia has seen over the last two decades has informed their future development pipeline in the suburb.

“Rhodes has moved from being largely an investor market to a strong owner-occupier community,” Moran says. “There’s real demand for three-bedroom homes, flexible intergenerational layouts, and apartments people can grow into.”

&nbsp;“We’re designing taller, more slender towers to free up the ground level for sport, recreation and green space. High-density communities thrive when people have the best backyards in Australia, and that’s what we want to create here.”

Demand remains robust, evidenced by Billbergia’s recent results. “We achieved a record sale across the entirety of Rhodes Central just last week,” Moran says. “It shows the depth of confidence buyers have in what’s being built here.”

Billbergia’s vertically integrated model allows them to overcome the recent cost escalation and challenges in the build environment. “Having an in-house construction team lets us control feasibility, value management and quality from day one,” Moran says. “It’s critical in the current market, where construction escalation is at the forefront of every project’s viability.”

The company is also leveraging the NSW Government’s new Housing Delivery Authority process, which Moran describes as a more efficient pathway without compromising design standards. 
 
“We’re really applauding the NSW Government for its efforts to increase housing supply. There’s been a remarkable improvement in how they’re helping deliver more homes, more quickly.”

Billbergia has already commenced construction of Stage One of the Rhodes Bay masterplan. They will be lodging the State Significant Development Application before Christmas.

“We’re moving quickly, but with due care,” Moran says. “This is a generational precinct, and it needs to be done right.”

Louis Christopher

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