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Hi Margaret,   
I have a brand new home and am about to rent it out.  I have building and contents insurance, as well as landlord insurance.  
The real estate agent in Queensland is telling me that they will not accept my business if I do not have public liability insurance to cover the tenants in case of injury.   
It is my understanding that this was the responsibility of the tenants?  
Your help is appreciated.
Kind Regards,
Salllie
 
Hi Sallie,
This is a good question and one which many new landlords ponder.  The responsibility for ensuring that a person has access to financial recompense if they injure themselves when on premises not owned by them falls to the owner of that premises.  In the case of a rental property, this responsibility clearly lies with the landlord, and so the agent is correct.  
However, you say that you have building, contents and landlord’s insurance already. This means that you will have public liability included in the building policy and the landlord’s policy, and both amounts are likely to be for cover of up to $10m!  Grab your policy and have a good read as I know you will find this inclusion in both.  
Which leads me to my next piece of advice.  Don’t use that particular manager to manage your property!  If you have told them that you already have both building and landlord’s protection insurance, they should know that you already have this cover.  Even if you have not told them you already have this, rather than just refusing your business, they should have explained how to get this cover, and you would then have been able to advise that it was already in place. 
In short it’s you who should be refusing their business!    
Regards Margaret,

<hr>
Margaret Lomas is a best-selling author and writes and hosts the popular Property Success With Margaret Lomas and heads up the panel on Your Money, Your Call, both on Sky News.
She is the founder of <a href="https://destiny.com.au/dotnetnuke/en-au/home.aspx" target="_blank" rel="nofollow">Destiny</a>.
Have a property question? <a href="mailto:askmargaret@propertyobserver.com.au" target="_blank">Ask Margaret!</a>
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mlomas-KC9MUPZ6Ca

Do I need public liability insurance to cover my tenants? Ask Margaret

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Hi Margaret, 
 I am interested in buying a property in <a target="_blank" href="/news">Ropes Crossing NSW</a>, The developer Bells River have asked me to sign two contracts: one for the land and the other for the house. I have to pay interest only when the house is being contructed.
 On the other hand I went to another developer and he said that he only has one contract, one for both land and house together. You just have to pay $10,000 up-front and the rest I have to pay after it has been constructed.
 I am still confused about what to do and where to go. Please help me one this.
Thanks,
 Ahsan
 
Hi Ahsan,
When you build a ‘project home’ or buy a house and land package, you are essentially buying directly from a builder.  He has already purchased the land and is about to undertake the construction on your behalf.

It’s very normal for you to be requested to firstly pay a deposit equal to the amount of the land, and then make progress payments, usually around five of them, as the construction gets to the different stages.   As you make these payments, you will pay interest to the bank and you won’t have any income to assist you with that.  I usually advise investors to add the total of these interest payments to the starting value to get a better idea of the true ‘buy in value’, as this is what should be used to asses true yield.

These days though, some larger developers offer, as an incentive to use their company, the option of simply making a small deposit at commencement and a final payment at the end.  This can have both advantages and disadvantages.  Obviously you don’t have any costs to meet until the property is ready for occupation, however it can place a strain on the developer, who still has to buy the materials and pay the holding costs on the land. unless they are exceptionally well financed, there could be issues down the track, such as a situation where they cannot meet their current liabilities, which may result in liquidation before you take delivery of your completed property.

I’d chat to the one offering the ‘buy now, pay later’ option and make sure that they can reassure you of their financial stability.  Outside of that, it comes down to what you can afford to do and whose product you think suits you the most.
Regards,
Margaret

<hr>
Margaret Lomas is a best-selling author and writes and hosts the popular Property Success With Margaret Lomas and heads up the panel on Your Money, Your Call, both on Sky News.
She is the founder of <a href="https://destiny.com.au/dotnetnuke/en-au/home.aspx" target="_blank" rel="nofollow">Destiny</a>.
Have a property question? Ask Margaret!
 

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How do I choose between house and land projects and why are the contracts structured differently? Ask Margaret

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Hi Margaret,
I have recently bought an investment property, and wish to maximise depreciation.  In the market there are so many quantity surveyors, how do I go about finding the best one? Are they all the same?
Many thanks, Daniel
 
Hi Daniel, 
Maximising depreciation on a property is really important, as it adds to the cash flows and can turn a previously negatively geared property into a positive cash flow one.  Even in a low interest rate environment, the possibility of achieving a positively geared result in your property investing (where raw rent exceeds raw expenses, and you pay tax) is limited to those areas with unusually high rental yields – these are usually areas based on one industry and with a greater risk to the investor. 
Where you have purchased in an area with more normal yields in the 5 – 6% range, on paper deductions, which are items which do not add to the expense ledger, can result in extra tax back.  This extra tax can plug up that shortfall between what comes in and what goes out and help you to stay in the market longer, as your holding costs are more well covered.  
Finding a quantity surveyor who is going to maximise these deductions is an important part of the investing process.  Understanding how they perform their calculations can help you to narrow down the good ones.  
The depreciation allowances themselves do not change from company to company – there is a prescribed amount which can be claimed on plant, equipment and buildings and the period of time over which they can be  claimed is  also prescribed, in the main, by the tax office.  It is the way that a quantity surveyor does their estimating that creates the difference in two different reports from two different companies.  
A quantity surveyor must, in effect first look into the past to establish what the original construction costs may have been for your property.  Then, they must estimate the value of the items within the property such as carpets, curtains and light fittings.  The first part is easier as there are tables which outline construction costs according to the years in which they were effected, but estimating a second hand value on an item for which you do not know the original purchase price is where the skill comes in.  
I’d suggest that first of all you ensure that the company you choose employs only duly qualified people and has a fairly long history in the business.  I like to choose companies which do a lot of the larger work too – the ones who do the big commercial and industrial estimating, as this is harder and requires a greater level of skill.  Next ask for a copy of a sample report, and then compare them across a couple of companies – these sample reports often contain similar sample properties so you can see how they differ.  
Lastly nothing is as good as a testimonial from satisfied clients.  Ask if they have happy clients who are willing to talk on their behalf, and whether it’s OK for you to contact them or be contacted by them.   If they can provide people who use them over and over again, this kind of testimonial can tell you much more than you can ever know from asking the company itself if they think they are good.  If they cannot provide this type of testimonial, there could be a good reason why!
Regards,
Margaret

<hr>
Margaret Lomas is a best-selling author and writes and hosts the popular Property Success With Margaret Lomas and heads up the panel onYour Money, Your Call, both on Sky News.
She is the founder of <a href="https://destiny.com.au/dotnetnuke/en-au/home.aspx" target="_blank" rel="nofollow">Destiny</a>.
Have a property question? <a href="mailto:askmargaret@propertyobserver.com.au" target="_blank">Ask Margaret!</a>
 
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I wish to maximise depreciation; how do I find the best quantity surveyor? Ask Margaret

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Hi Margaret,
We bought 1.33 acres of land in a subdivision on at the end of last year with the hopes of building a home on it in 2014. Since we bought the land my husband was in a pretty bad work accident and our plans to build a home have changed. 
We would like to put the land up for sale now but have questions on the capital gains that we may owe since we have not owned it for a year yet. We paid $35,000 and are not looking to make a profit on it when we sell. 
Help!
Shawn


<hr>
Hi Shawn,
When you buy any property as an investment, it immediately begins attracting capital gains tax (CGT).  CGT applies to all property you own, regardless of whether you intend for it to make a profit for you (as in a pure investment) or whether you think you might use it at some time in the future for yourself.
Your own home, or principal place of residence, is exempt from CGT, but you can only claim one property at any one time for that exemption. It must also be a property which is your bona fide principal place of residence (unless you are invoking the six year rule which allows you to move out of a principal place of residence for up to six years). 
The rate of tax is determined by how long you held the asset for – in the case of property, you get a 50% discount if it is over 12 months and you pay full tax (according to your own marginal rate of income tax) for any asset held less than that period of time.
In your case you purchased this acreage for the purposes of building your own home, but at no time has it been your principal place of residence and so you may have a CGT liability, at the full rate, if the contract for sale is signed within 12 months of you signing your own contract when you purchased.
However if, as you say, you do not intend to make a profit, you may instead have a capital loss. This is because your cost base (that is the starting value) is the purchase price plus costs to buy, and your ‘proceeds’ figure is the sale price less any cost to sell. In addition, the interest on any loan you had to hold this land, plus any costs you incurred while you held it (such as rates), add to the cost base, effectively reducing the difference even further!  
This difference becomes the gain, or loss.  If you sell for a similar price to that which you paid, once you account for all of the costs I mentioned, you will be more than likely to have a loss and there will be no tax.  However there will be no tax deduction either, as this loss can only be carried forward indefinitely to be written off against any future capital gain you may make from other investments.
You should be sure to get some good guidance from an accountant around what you can and cannot claim prior to making the sale.
Regards,
Margaret

<hr>
Margaret Lomas is a best-selling author and writes and hosts the popular Property Success With Margaret Lomas and heads up the panel on Your Money, Your Call, both on Sky News. 
She is the founder of <a href="https://destiny.com.au/dotnetnuke/en-au/home.aspx" target="_blank" rel="nofollow">Destiny</a>.
Have a property question? <a href="mailto:askmargaret@propertyobserver.com.au" target="_blank">Ask Margaret!</a>
 
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Do I have to pay capital gains tax on land I haven't owned for a year? Ask Margaret 

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Dear Margaret,
I am thinking of buying a house as an investment in Eastwood, NSW. Is this the right time? I see many houses in Eastwood for sale at present but the price is moving up so fast. 
Do you have any advice? 
Thank you,
K. C. Wong
 
<hr>
 
 
Dear K.C.,
Eastwood, along with many areas in Sydney at present, is very much the subject of buyer frenzy.  On the weekend we saw a ridiculous result where a property in this suburb sold at $1m over the reserve.
I always marvel at the fact that, when the buying is good (after a GFC, or other times when we have economic uncertainty) no one is brave enough to buy, as the uncertainty creates fear.  Yet, when there is buyer frenzy artificially pushing up prices, everyone wants to rush in before it's too late!  It's the latter scenario which actually carries the most risk.
When buyer frenzy exists, it's very easy for the investor to overlook the important growth drivers.  All they see is an increasing price and they want in on the action.  Often when you strip away the current demand you are left with very little, and this means that, once the attention is removed from the area, prices will stagnate and possibly fall.  If instead you buy in an area which has all of the known growth drivers, and you manage to get in before any kind of major demand begins, you can be sure that the area will show great growth even after the frenzied demand settles down.
Where Eastwood is concerned there is no question that the values are strong and that, under normal circumstances, a buy there would not lose money for you.  However, I caution you to take care at present, as the latest sale prices are far exceeding the intrinsic value of the area.  This means that when Sydney goes off the boil, areas like this will suffer and those who bought as part of the current demand cycle may well find that they either lose value, or sit for a long time with little or no growth.
It might be better to find an area just like Eastwood which is yet to come under too much attention, then you can be sure of maintaining your buy in price, and possibly even increasing it over time and in the future.
Kind regards,
Margaret 
 
<hr>
 Margaret Lomas is a best-selling author and writes and hosts the popular Property Success With Margaret Lomas and heads up the panel on Your Money, Your Call, both on Sky News. 
She is the founder of <a href="https://destiny.com.au/dotnetnuke/en-au/home.aspx" target="_blank" rel="nofollow">Destiny</a>.
Have a property question? <a href="mailto:askmargaret@propertyobserver.com.au" target="_blank">Ask Margaret!</a>
 
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Is it the right time to jump in to one of Sydney's hotspots? Ask Margaret

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Hi Margaret,
 I have my rental unit for sale and the real estate agent says a buyer is requesting a copy of my depreciation schedule. Should I supply this as it contains the purchase price?
Regards, 
David
<hr>
Hi David, 
There is no reason to provide this depreciation schedule at all, since a depreciation schedule is prepared for a person, not for a rental property per se. 
The new buyer will not be able to use this schedule for their own claims and must have one of their own prepared. This is because their acquisition date is different than yours and the plant and equipment will be dealt with differently for them than it was for you. 
Essentially, the plant and equipment will get a ‘new effective life’ in consideration for the fact that it was not new when they bought the property from you.

Having said that, you can provide, for their information only, the amounts which have been listed therein, as this does not give away your original purchase price at all. 
Depreciation is divided into two main parts – that for the building and that for the plant and equipment.  Neither relate to what you paid for that property.  It’s possible that this information might provide a good guide to the buyer as to what they can expect, but it should be provided with a disclaimer that this is not provided as part of any tax advice, or even an expectation of what the new owner can achieve.
You should also advise them they must have their own report prepared. 
I’d put this in writing if you do decide to go ahead and provide this information, as you would not want the buyer to come back at you later claiming they only bought it on the basis of your advice about how much tax they could claim.   
Regards,
Margaret
<hr>
Margaret Lomas is a best-selling author and writes and hosts the popular Property Success With Margaret Lomas and heads up the panel on Your Money, Your Call, both on Sky News. She is the founder of <a href="https://destiny.com.au/dotnetnuke/en-au/home.aspx" target="_blank" rel="nofollow">Destiny</a>.
Have a property question? <a href="mailto:askmargaret@propertyobserver.com.au" target="_blank">Ask Margaret!</a>
  
 

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Should I supply a buyer with my depreciation schedule? Ask Margaret

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Hi Margaret,   
I have read some of your books and in particular I am trying to apply the <a target="_blank" href="https://www.propertyobserver.com.au/landlords/the-20-questions-to-ask-before-you-buy-an-investment-property-margaret-lomas/2013072163457">20 Must Ask Questions</a> to a property purchase. 
However I am not 100% sure if I am applying them correctly.  
I am looking at Kallangur in Queensland. It seems to have a good mix of demographics &amp; employment, and a steady increase of population. However <a target="_blank" href="https://www.abs.gov.au/AUSSTATS/abs@nrp.nsf/Lookup/314021388Main%20Features12007-2011?OpenDocument&amp;tabname=Summary&amp;prodno=314021388&amp;issue=2007-2011&amp;num=&amp;view=&amp;">in the ABS it gets grouped along with Dakabin</a>, so I can't be sure of the exact figures.  
There seems to be some positive signs for their infrastructure, with a new train line coming to town. There are also a lot of shopping centres  opening up in neighbouring suburbs, which I think may help with local industry.    
The vacancy rates seem low, and there seems to be enough of a demand for rental properties. However as it is located in a growth corridor there are a lot of new homes being built in neighbouring suburbs. I am not sure if this will increase supply too much, or help to keep industry and population growth humming.   
Also at the moment I see there aren't very high sales volumes in the area, which means I can probably get a bargain, but at the same time the market is slow so capital growth could be a while off.     
Can you tell me your thoughts?  
Thanks,     
Evan 


<hr>
Dear Evan,
One of the reasons that I created the 20 Must Ask Questions ® was to provide a template by which someone could assess whether an area is one which has the potential to provide a suitable cash flow in the short term and sufficient growth over the longer term. 
The thing about these questions is that they make it very easy to identify areas which you should not consider, but when it comes to those you should consider, you have to be able to apply a little bit of analysis to the answers you are getting.  
One of the questions is ‘what are the trends’ and when you expand this it points to being able to identify a growth driver, but then work out why it is there and if it’s sustainable.  If an area has a decreasing vacancy rate, for example, on the surface that may appear to indicate an increasing demand for rentals. 
Scratch that surface though and you may discover a short term employment project which has brought itinerant workers to the area seeking six – 12 month leases, and once that project is over the vacancies rates may trend up again.  
You talk of ‘growth corridors’ but sadly this has become a term used loosely by the spruikers who sell property and it has little application for an investor who wants to be sure that every property they buy is ‘pre-hotspot’ – that is, it’s not too late yet and growth is imminent.  
Single factors like those uncovered when you ask the 20 questions don’t drive growth in their individuality – rather it’s the ‘concert of factors’ which is what you should be looking for.  And so, a new rail station or a new hospital on its own is not a growth driver – yet a population growing faster than the national average where there is a shortage of property, no new land and a council ensuring that transport and health needs are met through infrastructure development certainly is!  
Lastly you need to look at recent history to see what has happened from a growth point of view.  All of Moreton Bay Shire has fairly recently had a significant shift upward of prices in response to the earlier development of a better road system and the inward migration of first-home buyers, which created a demand that, for a time, left supply behind. But this settled as the prices grew that little bit past true first home buyer range, and the bulk of the ‘new’ infrastructure was completed. 
The best window of buying opportunity is past for now as we see supply outstripping demand, and in my opinion, until the demand factor once again exceeds supply, the best growth is behind this area, for the time being.  
You are looking at the right things though – you are just not building a  complete picture by looking at all of the drivers as they relate to each other, and then working out if you’re too late, or not.  Take this knowledge you have and go and find a Kallangur which hasn’t taken off yet!  
Kind regards,
Margaret

<hr>
Margaret Lomas is a best-selling author and writes and hosts the popularProperty Success With Margaret Lomas and heads up the panel onYour Money, Your Call, both on Sky News. She is the founder of <a href="https://destiny.com.au/dotnetnuke/en-au/home.aspx" target="_blank" rel="nofollow">Destiny</a>.
Have a property question? <a href="mailto:askmargaret@propertyobserver.com.au" target="_blank">Ask Margaret!</a>
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Am I applying the  20 must ask questions correctly? Ask Margaret

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A property broker has suggested that I invest in Brisbane in government income guaranteed apartments.
Currently, I live in Sydney and my bank has warned that interstate investments using a broker often are 'two-tiered pricing'. 
I had never heard of this.
Thanks,
Shirley
 
<hr>
 
Dear Shirley,
First let’s get clear exactly what this might mean.  There is no such thing as a ‘government income guaranteed’ apartment and many spruikers use this term very loosely to inspire confidence in you and to infer that what they are selling to you is, in some way, iron clad – not true!
I can think of only two scenarios where a spruiker might attempt to trade off on some kind of government backing – Defence Housing Australia (DHA) and the National Rental Affordability Scheme (NRAS).
DHA is a scheme whereby you purchase a property in an area where this department has supply and they provide to you a ‘management agreement’ type service. 
This management agreement costs more than a standard management agreement (around 16% of rent) but in return your property is maintained against wear and tear (not major repairs) and a member of the defence force is chosen for a tenant. 
In some ways this is a rent guarantee and the terms are usually between 7 and 10 years.  
NRAS is a scheme whereby, in return for the owner leasing their property at a rent which is 20% below market value, tax credits of around $10,000 per annum for 10 years are supplied. 
This scheme was originally designed for large institutional investors, such as insurance companies and superannuation funds, who would build and supply lots of 100+ properties and in return receive the tax credits. 
Somewhere along the way spruikers got their grubby little hands on them and on-sold the scheme to individual investors. 
The tax office had to run around placing interim tax arrangements in place to deal with this and now we see them offered as an investment opportunity for anyone.  
While both schemes have a possible cash flow upside, the existence of an overlying scheme cannot assure you of a quality underlying asset.
Just because you get a tax benefit or a guaranteed rent doesn’t mean you are buying a property which will grow well or be a good investment. 
You must separate the scheme from the asset and ask <a href="https://www.propertyobserver.com.au/landlords/the-20-questions-to-ask-before-you-buy-an-investment-property-margaret-lomas/2013072163457" target="_blank">20 questions</a> to determine if the property would be a good buy without the scheme.  
Where NRAS is concerned I happen to know that the re-sellers are in for around $25k+ in commissions and so do be careful that the property is at market value when you buy it. 
Remember too that, as they are usually built in lots of 100, all completed at the same time.
The market is often flooded with properties – this not only impacts values (and usually they are worth considerably less on completion than the investor pays) but it means there are plenty of rentals available. 
This will push down yields and, as you already have to charge 20% below the market rent, if the market rent falls you could be up for very low yields indeed.  
My final word on the subject is this – you should never take investing advice from a property ‘broker’, or anyone whose aim is to sell a property to you. 
They cannot possibly be independent if they are giving you advice about where to buy and then profiting from selling you a property there!
Margaret Lomas is a best-selling author and writes and hosts the popularProperty Success With Margaret Lomas and heads up the panel on Your Money, Your Call, both on Sky News. She is the founder of <a href="https://destiny.com.au/dotnetnuke/en-au/home.aspx" target="_blank" rel="nofollow">Destiny</a>.
Have a property question? <a href="mailto:askmargaret@propertyobserver.com.au" target="_blank">Ask Margaret!</a>
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Is there really "government income guaranteed" housing?: Ask Margaret

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We have just sold our family home of thirteen years and have been told we have to pay capital gains tax on three acres of the eight the house was built on.

Is this true and if so how do they estimate the amount we owe? 

We originally bought the land with a view to subdividing at a later date but because it is now included in the green wedge overlay we cant do this. 

Land can only be subdivided to twenty acre blocks surely that makes our three acres worthless as we can't sell them. 

We are about to retire and the thought of having to pay this tax is quite alarming.

 

Thanks,

Pat

Dear Pat,

This is a little known fact about acreages and one that people can often be inadvertently caught by. 

If you own a property which is more than five acres, then any part of the land more than the five acres is subject to capital gains tax and cannot attract a Principal Place of Residence exemption. 

I’m guessing this is to prevent people from buying a larger, broad-acre lot, living on it and then trying to profit from DA approvals which can increase the value significantly while they avoid the tax they would otherwise pay if it were a pure investment. 

The only way to get out of this is to conduct a business on the property (such as a farm).  

In your case you did buy with a view to subdividing, so I guess it’s fair enough that it was more than just a PPOR for you and you bought it as an investment.  

You might feel that as it has not turned out and you cannot make the profits you had planned that you should not have to pay the CG. But, that’s like saying that if you bought a parcel of shares expecting them to double and they only went up by 10%, you shouldn’t have to pay any tax on the smaller gain!  

One of the things about the acreage is that usually the five acres upon which the house sits is usually far more valuable than undeveloped portion and when you sell you don’t have to necessarily apportion the value equally across the eight acres.

This is because you can choose which five acres is exempt, as long as you include the land on which the dwelling is built in the portion you claim the exemption on. 

This means you can have a valuation done showing the value of the land holding the house and the value of the residual, unused three acres, and it’s likely that the unused amount will have a proportionately lesser value. 

From this, you apportion the percentage that the three acres represents of the entire value, and work backward – this is the percentage of the original purchase price which becomes your cost base for working out the value upon which you must now pay CGT.  

Remember as you have held it for more than 12 months you qualify for the 50% discount and so it may well work out that the CGT burden is not as large as it may first appear.

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Do I have to pay capital gains tax on land, even if I haven't subdivided it?

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Hi Margaret,
I have read your response to the question raised on <a target="_blank" href="https://www.propertyobserver.com.au/residential/ask-margaret-should-i-buy-off-the-plan-or-an-existing-property/2013062862801.">should you buy off the plan or existing dwelling for investment</a>.
After reading this I had some questions of my own. My current situation is that I'm 23 and looking at buying my first investment, obviously to also take advantage of the first-home owners grant (FHOG) &amp; stamp duty exemptions as well. My strategy was live in the apartment for 6 months and then rent it out.
I have done quite a bit of reading about buying an investment property, the risks of negative gearing, buying property off the plan and all the other jazz. I've also done some speculative/assumption modeling for buying off the plan and investing but I don't want to be disillusioned by my own thinking.
Since I was wanting to take advantage of FHOGs I’m limiting myself to new and off the plan apartments, so from a risk perspective I tried to lower the risk by investing in a blue chip/boutique suburb such as Lane Cove North (there’s about 5 other developments in the area too).
A lot of the developers already include commissions/the gov grant included in their pricing matrix so buying off the plan I will already be overpaying for a property in Sydney.
Say my investment strategy is for the long term and I’m willing to hold on the apartment, would it still be worth it to invest in off the plan (taking advantage of the $15,000 and all stamp duty exemption)?
Regards
David
 
David,
Before I answer the question, let’s get a few things straight.
The FHOG is a sum of money available to homebuyers who wish to acquire an owner occupied property. 
It is not for those who wish to buy an investment property, and who are planning to live in it only for the minimum 6 months to keep the grant. The 6 month minimum (which must occur within 12 months of settlement) is provided for those who genuinely access the grant, intending for the property to become an owner occupied one, and then have changed circumstances which require them to move out.
If your aim is to use the grant to buy an investment property, you will run the risk of having that grant revoked in the future, should there be any evidence that you never intended for the property to become your own home.
If you buy an investment property without accessing the grant, this grant remains available to you for your first home purchase, as long as you never live in any properties you buy before that time.  So, not using it will not result in you losing it if you buy a property purely for investment.
You talk about ‘blue chip’ suburbs, but this term has little meaning any more. 
Originally used to describe shares of long standing, well- established companies, this term was then applied to those long held, established areas where it was believed that growth would always be better and bigger. 
Much has changed about how property performs and this is largely attributed to the urban sprawl, and the capacity of larger regional areas to meet the lifestyle and employment needs of a more diverse range of people.
In other words, some areas which used to be considered ‘country towns’ are now thriving metropolises in their own right. 
If you use old time thinking to invest today, you may well make a very large mistake. In the past 20 years we have seen some lacklustre performances indeed from what has always been referred to as blue chip suburbs, and I’d say this is because their values, having already hit fairly high levels, have little room to move when you consider the average buying power of the majority of the population.
And so; if your aim is to buy an investment, then you will see a far better short term yield and likely a better long term return in terms of growth, if you can find those areas which have not had large gains yet, but which have an abundance of growth drivers. 
You don’t have to take the risk involved in buying off-the-plan, where you cannot confirm true market value and where often those commissions are built in to make them overpriced.  You should be casting your net more widely and looking for areas where population is growing faster than the national average, diversified employment opportunities exist and property is still affordable to the greater portion of the buyers. 
Property such as this is more exposed to the demand factors which push up prices and result in better growth for you, and these same properties generally have a better rental yield in relation to purchase price, making it easier to hang on to as the cost to you is minimised.
Most importantly David, do nothing until you become educated.  Attend a good course (like Destiny’s Essential Property Education) and take no action until you are better trained.  It makes no sense to make such a large investment if you haven’t got the knowledge and skills to get it right.
Margaret Lomas is a best-selling author and writes and hosts the popular Property Success With Margaret Lomas and heads up the panel onYour Money, Your Call, both on Sky News. She is the founder of <a href="https://destiny.com.au/dotnetnuke/en-au/home.aspx" target="_blank" rel="nofollow">Destiny</a>.
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Ask Margaret: Does the first-home owners grant make it worth the risk to buy off-the-plan?

Repeat buyers are one of the strongest measures of confidence in any apartment development.

At <a href="https://www.apartments.com.au/new-apartments/era-newcastle-west-124-126-bull-street-newcastle-west-nsw-2302">ERA</a> in Newcastle West, some purchasers are returning to <a href="https://www.apartments.com.au/developers/gwh">GWH</a> after living at the developer's One Apartments. Their decision to purchase again was driven by the quality of life they found after moving into their first GWH home.

Keith Wilton had spent years living in a house in East Maitland before deciding it was time for a change. Apartment living had always been on his radar, but he was selective about what he wanted.

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"I had some boxes I wanted to tick," he says.

Keith points to the open-plan design, generous outdoor areas and considered inclusions as key reasons One Apartments worked for him.

“One of those things was a nice indoor open plan area, but also I wanted a nice outdoor open area that I could entertain on in summer or Christmases or birthdays,” he says.

He also found value in the smaller details, from integrated appliances to shared resident spaces including the pool, cinema and rooftop areas.

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After comparing several developments, he chose One Apartments because of GWH's longstanding local reputation and his own experience working with the developer on a commercial project more than a decade earlier.

"I knew that they were local, that the quality of the build was going to be up there. I'd looked at other apartment complexes around and close by, and I just knew that here was a better decision location wise."

Today, Keith says the move has completely changed how he experiences Newcastle.

"I enjoy living in this location because it's more of a lifestyle change. That Newcastle city living where you can walk to restaurants and bars and even beaches and parks and even shopping across the road."

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Beyond the location, he says it's the sense of community that has surprised him most.

"Everyone loves living here because they chose to live here, but everyone looks out for each other. It's a real great community feel here."

For Aimee and Lyle Goodman, the journey started almost by chance.

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The couple happened to be having coffee in Newcastle when they noticed the site where One Apartments was about to begin construction.

"We were aware GWH was planning a development," Aimee says. "We made one phone call and things moved pretty quickly after that."

As busy business owners, they initially thought apartment living would simply reduce the maintenance that came with larger homes. Instead, it fundamentally changed how they spent time together.

"We actually catch up more as a family now," Aimee says.

"We've had homes with big yards and lots of space, but everyone ended up in different rooms. Here we'll have dinner together, the kids can play, and we spend far more quality time together."

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Lyle says their confidence came from GWH's reputation within Newcastle's building industry.

"I know people who've worked across different apartment projects, and whenever GWH came up the feedback was always the same. They're rock solid. They're quality."

That confidence only grew throughout the buying process.

"One of the things that really impressed us with GWH was the whole process, was the communication," Lyle says. "It was consistent, it was regular, there was no problem if we had some weird questions, there was no problems in getting answers."

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Aimee says one moment stood out.

"The project actually finished on time. We realised we needed to hurry up and sell our house because everything was happening exactly when they said it would."

The positive experience at One Apartments ultimately gave all three buyers the confidence to purchase again with GWH, this time at ERA.

Their confidence reflects what many buyers are seeking in today's apartment market. Location remains important, but so too does certainty around delivery, quality and long-term liveability.

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ERA builds on those foundations with 280 one, two and three-bedroom apartments across two landmark towers in <a href="https://www.apartments.com.au/developments/newcastle-west-nsw-2302">Newcastle West</a>.&nbsp;

Designed by <a href="https://www.apartments.com.au/architects/fk-australia">Fender Katsalidis</a>, the project will include more than 2,000 square metres of resident amenities, including a resort-style pool, gym, sauna, private cinema and rooftop entertaining spaces overlooking the harbour and coastline.&nbsp;

The development is also within walking distance of the Newcastle Interchange, Honeysuckle, Darby Street, the harbour foreshore, restaurants, retail and the city’s beaches, continuing the walkable lifestyle that existing GWH buyers say has transformed how they live.

[smartcode_project:default project_id=135096 project_image_fid=356826]

For Keith, the appeal remains straightforward.

"You feel at home even before you've moved into your home."

For Aimee, the change is measured in time.

“I just felt like I had more time,” she says.

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Construction at ERA is now underway, with more than half of the residences already sold and limited two and three-bedroom apartments remaining in the East Tower release. Priced from $980,000 for two-bedroom residences and $1.46 million for three-bedroom residences, buyers can secure an apartment with a 10 per cent deposit, with premium homes offering ocean views from Level 8 and harbour views from Level 10.

ERA is also backed by Resilience Insurance's 10-year Latent Defects Insurance policy, providing protection against structural or waterproofing defects for 10 years after completion. The project is anticipated to be completed in early 2028.

[smartcode_project_cta:default project_id=135096]

Joel Robinson

From ONE to ERA: Why buyers are choosing GWH again in Newcastle West

Virgate Property Group is preparing to commence construction of Verdé, its new apartment development in Melbourne's Arts Precinct at Southbank, following a strong run of sales that has seen more than half of the project's 173 apartments secured.

Verdé has attracted a broad mix of first home buyers, owner-occupiers upgrading from nearby inner-city suburbs and investors, with younger owner-occupier couples aged between 28 and 45 accounting for the strongest enquiry. Many are already living in Southbank, South Melbourne, Albert Park, Port Melbourne, South Yarra and the CBD.

"Verdé is located in one of the most desirable pockets of southern Melbourne," Blair Property Group Director Darren Blair, who is managing sales at Verdé, said.

"It's within walking distance of the Arts Centre, Royal Botanic Gardens, Albert Park Lake, and Southbank's restaurants and retail. It's a great lifestyle location with strong amenity and liveability, which made it a very attractive choice for the project."

[smartcode_project:default project_id=4661 project_image_fid=372549]

Virgate was already familiar with the precinct, having previously delivered the successful Domain House development in neighbouring South Melbourne. That experience gave the developer confidence to acquire the Coventry Street site and continue expanding its presence in Melbourne's inner south.

"We had been keeping an eye on the site and the broader precinct for a few months before deciding to move forward with the acquisition," Virgate said.

The project was ultimately secured in 2020 following feasibility studies, planning assessments and due diligence, with the brief centred on delivering "a high-quality, considered design that feels both refined and fit for purpose."

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Designed by <a href="https://www.apartments.com.au/architects/bruce-henderson-architects">Bruce Henderson Architects</a>, Verdé comprises 173 one, two and three-bedroom apartments priced from $599,000. The architecture is distinguished by a faceted glass façade that responds to both the site's outlook and Melbourne's changing light conditions.

According to Bruce Henderson Architects, the coloured glazing gives the building a distinctive identity while also providing privacy and solar shading, with residences oriented to capture views across the bay, city skyline and surrounding parklands.

Inside, <a href="https://www.apartments.com.au/interior-designers/designoffice">DesignOffice</a> has created interiors focused on natural light, efficient planning and enduring materials. Apartments feature engineered oak flooring, natural stone benchtops, floor-to-ceiling glazing and SMEG appliances, while a restrained material palette aims to complement the expansive outlooks rather than compete with them.

[smartcode_project:default project_id=4661 project_image_fid=372550]

Resident amenity has also been designed around everyday functionality rather than occasional use. Facilities include a concierge-serviced lobby, residents' lounge with fireplace, library and co-working space, gym, terrace garden with barbecue facilities, ground-floor café, and package delivery management.

The project's location continues to be one of its strongest drawcards. Positioned on Coventry Street, Verdé sits within walking distance of the National Gallery of Victoria, Arts Centre Melbourne, Royal Botanic Gardens and Albert Park Lake, while Southbank's dining precinct, Sturt Street trams and the new ANZAC Station are all nearby. The surrounding education catchment also includes Melbourne Grammar, Melbourne Girls Grammar, Mac.Robertson Girls' High School and several major university campuses.

The sales team says buyers have responded particularly well to the combination of location, design quality and long-term liveability.

"They're responding really positively to the quality of the design, premium resident amenities and the uninterrupted views. Many also appreciate the location and how connected it is to everything they need."

The ability to secure stamp duty savings before completion has also been a key factor for purchasers, alongside the opportunity to personalise finishes ahead of settlement.

With construction set to commence soon and more than half the apartments already sold, Verdé enters its next phase as one of the Arts Precinct's more established apartment developments, offering remaining buyers an opportunity to secure a residence before construction advances further. Expected completion is scheduled for late 2027.

[smartcode_project_cta:default project_id=4661]

Virgate's Verdé Southbank moves toward construction as sales fly past halfway stage

Downsizer-focused apartment development Kooyongkoot in Hawthorn has been recognised at the 2026 Better Future Melbourne Design Awards, taking home Gold and Silver awards in two categories.

<a href="https://www.apartments.com.au/new-apartments/kooyongkoot-hawthorn-1-kooyongkoot-road-hawthorn-vic-3122">Kooyongkoot</a>, currently being delivered by developer PQD and designed by Cera Stribley, received Gold in the Interior Design – Proposed category and Silver in the Architecture – Proposed category.

The dual recognition reflects the design approach behind the boutique development on prestigious Kooyongkoot Road, where the focus has been on creating homes for downsizers seeking the space, quality and functionality of a detached house within a low-rise apartment building.

Rather than maximising apartment numbers, <a href="https://www.apartments.com.au/developers/pqd">PQD</a> and <a href="https://www.apartments.com.au/architects/cera-stribley-architects">Cera Stribley</a> limited the development to just 18 residences, allowing for larger floorplans, greater privacy, generous landscaping and expansive communal spaces.&nbsp;The majority of the apartments also benefit from corner aspects, allowing for dual sources of natural light.

Now around 70 per cent complete and on track for completion in November 2026, Kooyongkoot will comprise a mix of garden residences, ter​race apartments, sub-penthouses, and is crowned by two half-floor penthouses with direct lift access and private rooftop terraces.

[smartcode_project:default project_id=102717 project_image_fid=355297]

The Silver Award for Architecture recognised the way the building responds to its prominent corner position at the ent​rance to Hawthorn's Scotch Hill precinct, one of Melbourne's most established residential neighbourhoods.

Rather than competing with the grand homes that line Kooyongkoot Road, the architectural approach focused on restraint and longevity, using curved brickwork, generous landscaping and carefully considered proportions to integrate with the existing streetscape.

"The form feels fluid and timeless, as though shaped by the landscape itself – architecture that belongs, rather than competes," said Chris Stribley, Co-Founder and Managing Principal of Cera Stribley.

The judging submission also highlighted practical innovations throughout the building, including lift cores servicing only nine homes each, a central landscaped lightcourt designed to bring daylight and ventilation into the building, and fully enclosed private storage rooms with lighting, power and shelving to better accommodate residents transitioning from larger family homes.

[smartcode_project:default project_id=102717 project_image_fid=355293]

The Gold Award for Interior Design recognised the project's focus on long-term liveability rather than display-home aesthetics.

According to the awards submission, the interiors were designed from the inside out, prioritising how homes would function over decades of daily use through generous proportions, practical storage, durable natural materials and flexible layouts.

The specification includes natural stone throughout, upgraded acoustic glazing, V-ZUG appliances and fully enclosed storage rooms, alongside an amenity offering focused on wellness, entertainment and everyday convenience.&nbsp;

Residents will have access to a gym and yoga studio, a wellness centre featuring traditional and infrared saunas, a cold therapy shower and treatment room, as well as a residents' lounge and golf simulator/cinema room for entertainment.&nbsp;Kooyongkoot has also considered the everyday convenience of its residents by offering a private carwash and pet wash facilities on site as well as dedicated parcel lockers and oversized fully enclosed storage rooms.&nbsp;

[smartcode_project:default project_id=102717 project_image_fid=355303]

The project's attention to detail has already resonated with buyers. Earlier this year, Kooyongkoot recorded one of Boroondara's highest apartment sales when an $8 million penthouse was purchased by a Melbourne CEO downsizing from a nearby family home.

"Every detail feels deliberate, from the overall design down to the smallest touches," the purchaser said.

"The level of quality and refinement is exceptional, but what really sold it was how liveable it felt... It felt like a place where everything had been considered, not just a luxury building."

[smartcode_project:default project_id=102717 project_image_fid=355304]

Sustainability also formed a key part of both award submissions. Kooyongkoot is targeting a minimum 7.5-star NatHERS rating across all residences, supported by passive design principles, high-performance glazing, EV charging infrastructure, water reuse systems and a wellness model focused on lower-energy dry facilities rather than pools and large wet areas.

Located within walking distance of Scotch College, Methodist Ladies' College, Koo​yong Lawn Tennis Club, Aubur​n Village and Camberwell Junction, Kooyongkoot continues to target owner-occupiers looking to remain in Melbourne's inner east without compromising on space or quality. A limited selection of two, three and four-bedroom residences remains available, with prices starting from $1.9 million.

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Kooyongkoot wins Gold and Silver at Better Future Melbourne Design Awards

New apartment supply has become increasingly constrained across <a href="https://www.apartments.com.au/developments/parramatta-nsw-2150">Parramatta</a> in recent years, with fewer projects progressing through to completion as development conditions have become more challenging.

It makes <a href="https://www.apartments.com.au/developers/novm">NOVM</a>'s 2021-completed <a href="https://www.apartments.com.au/buildings/the-lennox-parramatta-12-phillip-street-parramatta-nsw-2150">The Lennox</a> one of the most recently completed residential towers on the Parramatta River, and among the newest apartment developments in Sydney's second CBD.

With the project largely completed before the sharp escalation in construction costs and inflation following the pandemic, The Lennox is now offering pricing that would be difficult to replicate in a comparable new development in Parramatta today, or across much of Western Sydney.

The majority of the 413 apartments at The Lennox sold before and shortly after completion. A limited release of the remaining apartments has recently been brought to market by capital partner <a href="https://www.apartments.com.au/project-marketer/equitifund-group">Equitifund</a>, with entry-level pricing from $700,000 and two-bedroom apartments available from under $1 million.

Rising above the Parramatta River at 12 Phillip Street, The Lennox comprises one, two, three and four-bedroom apartments, appealing to first home buyers, young professionals, families, downsizers and interstate investors seeking a completed apartment in one of Australia's fastest-growing economic centres.

[smartcode_project:default project_id=5743 project_image_fid=372394]

Rather than positioning Parramatta as an alternative to Sydney's CBD, Equitifund believes the city has reached a point where it stands on its own merits.

"Parramatta is no longer simply an alternative to Sydney CBD, it's becoming a destination in its own right," Equitifund Executive Chairman Greg Huxley said.

"The Lennox captures that evolution with a level of quality and amenity that's difficult to match at its price point."

[smartcode_project:default project_id=5743 project_image_fid=953]

Designed by <a href="https://www.apartments.com.au/architects/marchese-partners">Marchese Partners</a>, the tower responds directly to its riverfront setting through expansive glazing and open-plan layouts that maximise views across the Parramatta River and city skyline. Interiors feature engineered timber flooring, stone benchtops, stainless steel appliances and floor-to-ceiling glazing, while generous balconies extend the living spaces outdoors.

Marchese Partners says the project was conceived to balance high-quality apartment living with practical, long-term functionality, pairing larger, efficient floorplans with amenities more commonly associated with five-star hotels.

That emphasis continues through the resident facilities, which include a 20-metre rooftop swimming pool, fully equipped gym and wellness spaces, full-time concierge, a residents' lounge, function room, private lifts, secure basement parking and rooftop communal areas overlooking the Parramatta River. Ground-floor boardwalk retail and dining further activate the riverfront and integrate the building into the surrounding public realm.

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Australian housing and finance group Equitifund has secured the remaining apartments, believing there are few completed apartment opportunities in Parramatta that offer the same combination of location, amenity and pricing.

Equitifund National Sales Director Ben Hamblett says buyers are increasingly recognising that premium apartment living no longer needs to come with Sydney CBD pricing.

"The Lennox is where aspirational living becomes attainable," Hamblett said.

"Wake to river and mountain views, step into Sydney's Second CBD, and arrive home to resort-calibre amenities, all without the harbour price tag."

Hamblett says owner-occupiers are also attracted by the convenience of having Westfield Parramatta, Church Street's dining precinct, Parramatta Park, Riverside Theatres, Western Sydney University and major transport connections all within walking distance.

"At The Lennox, lifestyle is not an afterthought, it is the foundation."

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The Lennox places residents within walking distance of Parramatta Square, Westfield Parramatta, Church Street Eat Street, Parramatta Station, the ferry wharf, Light Rail, the future Sydney Metro West, Parramatta Park and CommBank Stadium, reinforcing Parramatta's position as one of Australia's most connected metropolitan centres outside Sydney's CBD.

Equitifund says buyers visiting the display suite consistently comment on the quality of the finishes, generous floorplans, river and skyline views, and the walkability of the location. The project has attracted a broad mix of local professionals, upsizers, downsizers, buyers relocating from Sydney's inner suburbs and interstate investors seeking long-term growth opportunities.

That demand aligns with Parramatta's continued evolution as an economic powerhouse. Equitifund Research and Market Insights specialist John Bekiaris says sustained population growth, infrastructure investment and expanding employment opportunities continue to support long-term housing demand across the city.

"Parramatta has evolved from a satellite city into one of Australia's most important economic centres. Population growth, infrastructure investment and employment are all supporting sustained long-term housing demand."

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The apartment price gap drawing Sydney buyers west

A luxury beachfront apartment at Rainbow Bay has more than doubled in value since it sold off the plan six years ago, setting a new local apartment record in the process.

The three-bedroom apartment in the Flow development on Petrie Street, the first of four new projects locally by Paul Gedoun's S&amp;S Projects, has sold for $7.4 million, after originally selling for $3.27 million when the project launched in 2020.

The seventh-floor apartment, comprising 187 sqm of internal living space and a 54 sqm balcony overlooking Froggies Beach and Snapper Rocks, was purchased by a local family.

The transaction was negotiated by Pezet Matheson director Kerry Pezet and equates to more than $30,000 per sqm.

Pezet said the sale reflected the limited opportunities to buy into the boutique beachfront development.

"The sale highlights the rarity of opportunities within the boutique beachfront development, where residences seldom become available," Pezet said.

"Flow is one of the Gold Coast's most tightly held buildings. Buyers from our database move quickly when residences become available, and achieving an off-market sale at $7.4 million demonstrates the depth of demand for property of this calibre."

<img alt="Flow" data-entity-type="file" data-entity-uuid="c585b206-2130-4eee-a50c-3f27c51a7c70" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-06%20at%208.33.25%E2%80%AFPM.png?VersionId=m3pHRDV62Y3fvN.XQuQHq.52ilTWpRLf" />

Flow was the first of four luxury apartment developments delivered by Paul Gedoun's S&amp;S Projects at Rainbow Bay and was completed in 2023.

Positioned on the beachfront overlooking Snapper Rocks, the residence includes three bedrooms, three bathrooms, a powder room and views stretching north along the coastline towards Surfers Paradise.

Pezet Matheson Residential principal Mitchell Lambert said buyers continued to prioritise quality beachfront apartments in tightly held locations.

"Flow Residences offers a rare combination of elevated beachfront positioning, architectural excellence, comprehensive resident amenity and premium finishes, which is exactly what discerning purchasers are seeking," Lambert said.

"The transaction further reinforces Rainbow Bay's reputation as one of Australia's premier coastal lifestyle destinations, where limited supply and growing demand continue to support strong market performance."

Pezet Matheson originally marketed and sold out Flow off the plan, making the latest transaction a return to one of the project's original buyers.

Paul Gedoun is selling his third project, <a href="https://www.apartments.com.au/new-apartments/radia-rainbow-bay-271-boundary-street-coolangatta-qld-4225">Radia Rainbow Bay</a>, after recently completing, and selling out, <a href="https://www.apartments.com.au/buildings/esprit-217-227-boundary-street-coolangatta-qld-4225">Esprit</a>. He has plans for a <a href="https://www.apartments.com.au/news/qld/first-look-s-s-projects-proposes-88-apartment-wellness-tower-at-coolangattas-boundary-street">fourth building</a>, 88 apartments on <a href="https://www.apartments.com.au/new-apartments/209-213-boundary-street-coolangatta-qld-4225">Boundary Street</a>.

Margaret Lomas

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