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I often get asked is residential property a better or worse investment than commercial property, but the answer is neither. Both asset classes can be great investment options, but it all depends on what the investor is aiming to achieve. This is because they are different types of investments with different characteristics that will help investors achieve different objectives.
For example, commercial property is more likely to produce a strong income stream because tenants of shops and offices pay more rent than residential tenants. Also, in most cases all outgoings such as rates and insurance are covered by the tenant, further boosting cashflow.
However, on the flip side capital growth potential is relatively low. Land appreciates (increases) in value, while buildings depreciate. The higher the proportion of land relative to the property’s overall value, the higher the capital growth potential.
With commercial properties, the building often takes up the lion’s share of the value. This low land value often means capital growth is relatively low. Therefore, the key advantage of commercial property lies in its ability to attract high rental returns.
The best commercial property is usually found in high population growth areas such as the outer suburbs with increasing demand from residents for goods and services provided by petrol stations, fast-food outlets and supermarkets.
This is the reason large commercial property trusts such as Westfield invest hundreds of millions of dollars in areas such as South Morang in Melbourne’s north. Surrounding growth suburbs such as Doreen and Mernda have experienced a population explosion in the last five years, and all these people need to spend money to live. This money flows straight into the coffers of the commercial property owners, and as population grows so does their income.
The large property trusts also target the CBD because of the large daily influx of office workers and growing population.
Because commercial property doesn’t have high capital growth potential to counterbalance the interest on a loan, it’s wise to borrow as little as possible (0 to 30%) and fund the purchase with cash.
Residential property, by contrast, doesn’t produce a high income stream because residential tenants can’t pay as much rent as commercial tenants. Landlords are also required to cover rates, and building insurance on the property further diluting their cashflow.
On the flipside, residential property tends to have better capital growth potential because the land usually makes up most of the property’s value and there is a more consistent underlying demand from people who need a roof over their head.
The best residential investment property is usually found in areas with moderate but consistent population growth driven by demand from home buyers, investors and tenants alike. Consistent demand drives land values, which in turn fuel capital growth.
Land values are highest in established areas where there is no more land to build on, such as the inner and middle suburbs. Suburbs such as Richmond or Elwood are highly sought after by residential investors, who already control more than 50% of the residential property in these markets.
Because well-chosen residential property can provide enough capital growth to offset the interest on a loan, investors are more likely to borrow a higher proportion of the purchase price than if you were buying commercial property.
If an investor is looking for capital growth and doesn’t have the cash to purchase a commercial property outright, he or she should focus on residential property. If you purchase in a location where land values are high, the capital growth will be enough to balance out the interest you’re paying on the loan. And, because the property will be producing income, your interest payments will be tax deductible.
Alternatively, an investor who has accumulated a significant nest egg and is now looking to generate income would be wise to focus on commercial property. With low borrowings and higher rental yields, the investor’s money would be producing an income and the investor might not have to work.
Mark Armstrong is a director of <a href="https://www.ipropertyplan.com.au/" target="_blank">iProperty Plan</a>, which provides independent analysis and tailored advice to investors and home buyers.
 
 
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Should you invest in residential or commercial property? Mark Armstrong

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For many years Toorak has been considered Melbourne’s most highly valued suburb, but it lost its stranglehold on that title in 2012.  This year Toorak only managed one of the top five sales in Melbourne, with the balance been spread out across other blue-chip locations.
It's only a preliminary list, with some sales yet to make it onto official records.
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Top 5 - 2012
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21 Kooyongkoot Rd Hawthorn
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$12,588,000
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26 Albany Rd Toorak
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$12,000,000
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35 Hampden Rd Armadale
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$9,500,000
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78 Esplanade Brighton
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$8,700,000
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43 Seacombe Grv Brighton
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$7,770,000
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Total value
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$50,558,000
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 This result is in stark contrast to the 2011 year when four out of the five most prestigious and valuable properties were located in the leafy <a target="_blank" href="/news">Toorak</a> streets.
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Top 5 - 2011
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2 Linlithgow Rd Toorak
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$16,500,000
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20 St Georges Rd Toorak
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$14,500,000
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16 Kenley Crt Toorak
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$12,610,000
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33 Chatsworth Ave Brighton
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$12,000,000
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12 Albany Rd Toorak
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$11,500,000
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Total value
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$67,110,000
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 If you were looking to buy Melbourne’s most expensive property this year located at 21 Kooyongkoot Road, <a target="_blank" href="/news">Hawthorn</a> (pictured below), you would have needed to have just over $12.5 million  up your sleeve.
<img alt="kooy" height="247" width="420" src="/images/stories/2012/12/kooy.png">
Kooyongkoot is an Aboriginal word meaning ‘the haunt of the wild fowl’, and although the wild fowl are no where to be seen, for this price you could have snapped up almost three-quarters of an acre on top of the highly sort after Scotch Hill. The property was sold to an overseas buyer in March and consists of a renovated Victorian mansion with tennis court and swimming pool.
While this sale was impressive it still falls a long way short of the 2009 record sale of Avon Court (pictured below), located at 18-20 Shakespear Grove, Hawthorn, which was sold to Autobarn boss Garry Dumbrell for a tad over $20 million.
<img alt="avon" height="313" width="470" src="/images/stories/2012/12/avon.png">
From where I sat 2012 was a more consistent year across the broader market, with lower interest rates resulting in a small lift in buyer confidence, which is expected to continue into 2013.
However, this confidence was not as strong at the top end of the market. In 2011 the top five the top five sales accounted for over $67 million of real estate, compared with a touch over $50 million this year. Also the highest price sale of last year was $16.5 million, when 2 Linlithgow Road, Toorak (pictured below), was traded off market. In addition to the ivy-covered walls surrounding the 3,363-square-metre block of land, this property also comes with the standard mansion, swimming pool and tennis court.
<img alt="lithgow" height="708" width="470" src="/images/stories/2012/12/lithgow.jpg">
Image from Google Maps
For those of us who had tighter cashflow pressures this year it may have been better to opted for the bottom end of the top five sales this year.  For $7.7 million you could have snared 1,251-square-metre block of prime beachfront land at 43 Seacombe Grove, <a href="/news">Brighton</a> (pictured below). Although it does comes with a spectacular view of the beach, there is no tennis court or swimming pool, so you would need to dip further into your pocket get these.
<img src="/images/stories/2012/12/seacombe.jpg" width="440" height="293" alt="seacombe">
For anyone who is looking to secure the highest-priced Melbourne home for 2013, here are some sobering figures for you. The average sale price of this year’s top five was just over $10 million. So to start with you need to get your hands on the $1 million deposit, which is not far off double the current median house price.
From there if you are looking to finance 80% of the property value you need to find close to half a million dollars of after-tax income a year just to keep pace with interest payments.
Something to think about as 2012 winds down and we start to make plans for 2013.
I hope you all have a great Christmas break.
Mark Armstrong is a director of <a href="https://www.ipropertyplan.com.au/" target="_blank">iProperty Plan</a>, which provides independent analysis and tailored advice to investors and home buyers.
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Toorak loses its stranglehold on Melbourne's top-end property market in 2012

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Trying to pick property market movements in recent years has been tricky to say the least, but a recent lending report from Westpac bank into home loan approvals gives us an indication of what lies ahead in 2013.
The report shows that while lending for homes remained stagnant in October, the number of loans for investors continued to climb. Loan approvals to investors rose 5.5%, and this was off the back of a massive 8.8% jump for September. Year-to-date loans for investors have risen by 21%.
The planets are aligning for investors as the numbers begin to stack up. It is now becoming very affordable for investors to seriously consider a property purchase. But as the investors return to the market, the savvy ones will be looking to purchase properties that not only have minimal holding costs but also significant capital growth potential.
Investors will no doubt hit the traditional investment areas such as <a target="_blank" href="/news">South Yarra</a>, <a target="_blank" href="/news">Elwood </a>and <a target="_blank" href="/news">Richmond</a>. As usual, they will look for the standard requirement of good transport infrastructure, shopping, restaurants and bars because all theses things result in strong tenant demand.
However, investors should also be looking for emerging markets where properties are more likely to benefit from a big upswing in capital growth.
Take, for example, a couple of recent property sales in Melbourne’s inner west and north.
A one-bedroom apartment at<a target="_blank" href="https://www.realestate.com.au/property-apartment-vic-flemington-111304283"> 8/60 Farnham Street, Flemington</a>, sold recently for $335,000. This price is more than $100,000 less than the median price of apartments in Melbourne so represents very affordable buying. In addition to the low entry point this property has the potential to be let for around $300 per week.
<img src="/images/stories/2012/12/farnham.jpg" width="470">
 
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At a slightly higher price point but yet still very affordable is <a target="_blank" href="https://www.realestate.com.au/property-apartment-vic-northcote-112284991">20/203 Clarke Street, Northcote</a>, which sold on the weekend for $452,000. While the view of the CBD is magnificent, this property also has the potential to produce close to a 5% yield. In isolation, a yield at this level is great, but hand in hand with very competitive fixed rates these properties start to look very enticing.
<img src="/images/stories/2012/12/clarkest.jpg" width="470">
Currently an investor can lock in three-year fixed rates for less than 5.5% and taking it a step further,  five years can be locked in for just over 5.5%. This means properties such as these could be purchased and be very close to neutrally geared from day one. Investors would also have certainty over their interest payments for the next five years, and as time goes by the only variable is the rental return, which is likely to only move in one direction. Up.
Further, both of these properties are located in suburbs that are emerging investment areas. Traditionally investors have preferred to stay in the safe havens of the inner-eastern suburbs, where comparable properties could sell for an extra $100,000 or more.
Although houses in suburbs such as <a target="_blank" href="/news">Flemington </a>and <a href="/news">Northcote</a> have been highly sought for a number of years, a lot of buyers have viewed apartments as a risky option. However, as many investors are priced out of the eastern suburbs they will start to look for other opportunities. In short, properties like these have significant growth potential in the years to come.
It is important to remember that around 70% of the property market is controlled by home buyers. As a result the increase in investor demand is not going have an impact on the entire market, and overall growth may not be huge in 2013. However, investors will place increased pressure on pockets of the market, and these areas will have above average growth next year.
Mark Armstrong is a director of <a target="_blank" href="https://www.ipropertyplan.com.au/">iProperty Plan</a>, which provides independent analysis and tailored advice to investors and home buyers.
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Where Melbourne property investors should look to maximise capital growth in 2013

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Congratulations to Rainbow in Melbourne and Davidk9 in Sydney, who have taken out the title of Property Tycoon for spring 2012. A $1,000 Christmas bonus is on its way!
There’s a website, <a target="_blank" href="https://www.propertytycoon.com.au/">www.propertytycoon.com.au</a>, where punters can guess what they think properties will sell for at their weekend auctions in Melbourne and Sydney. This season <a rel="nofollow" target="_blank" href="https://www.propertytycoon.com.au/join-league/S7S123C487R8OOQF" style="font-size: 14px;">Property Observer readers had their own competition</a><a rel="nofollow" href="https://www.propertytycoon.com.au/join-league/S7S123C487R8OOQF">.</a> The winner of the overall competition won $1,000.
Carlyonc and RFM were the best-performing Tycoons in the final round and win the movie tickets.

A huge crowd crammed into the backyard of 14 Jessamine Avenue, <a target="_blank" href="/news">Prahran</a> (pictured below), on Saturday to watch a very quick auction. While there is no doubt there were more people who had an interest in the property, it was left to only two bidders to fight it out.
<img src="/images/stories/2012/12/jessamin.jpg">
The auction consisted of a flurry of $50,000 bids before a $2.4 million bid was referred to the vendor and the property was declared on the market.  After this announcement another burst of bidding took the price to $2.7 million before the property was knocked down.

You can watch the auction highlights on our <a target="_blank" href="https://propertytycoon.cmail5.com/t/r-l-uyljuud-etrwtikd-y/">Facebook</a> page.

It was a different story in Sydney where 1/64 Ocean Street, <a target="_blank" href="/news">Woollahra</a> (pictured below), failed to gain any real traction. Although there were interested parties in the crowd there was no sense of urgency as bidding was lacklustre. The property finally passed in to a legitimate bidder for $1,475,000.
<img src="/images/stories/2012/12/oceanst.jpg">
Since the conclusion of the auction agent Peter Starr has had interest slightly above $1.5 million, and the property is expected to sell in the coming days.

Thanks to everyone who played Property Tycoon this season. We will be back bigger and better in February 2013. Merry Christmas to all.

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Quick Prahran auction and lacklustre bidding in Woollahra round out 2012 auction tipping competition

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This Saturday will be the final round of Property Tycoon for 2012, and we have some belting properties going under the hammer.
There’s a website, <a target="_blank" href="https://www.propertytycoon.com.au/">www.propertytycoon.com.au</a>, where punters can guess what they think properties will sell for at their weekend auctions in Melbourne and Sydney. This season <a rel="nofollow" target="_blank" href="https://www.propertytycoon.com.au/join-league/S7S123C487R8OOQF" style="font-size: 14px;">Property Observer readers have their own competition, which you can access here</a><a rel="nofollow" href="https://www.propertytycoon.com.au/join-league/S7S123C487R8OOQF">.</a> The winner of the overall competition will win $1,000.
Dean Gilbert from Marshall White will have a big auction on his hands when he calls for bids at 14 Jessamine Avenue, <a href="/news">Prahran</a> (pictured below).
<img src="/images/stories/2012/12/jessamin.jpg">
Winton was built in 1929 and lies in one of Prahran's most tightly held heritage-listed leafy pockets, only metres from Lumley Gardens and High Street's cafes and shops. The totally captivating solid-brick English-style residence sits on almost 800 square metres of land and is surrounded by spectacular botanic garden setting.
Many buyers will want this one, but they will need more than $2 million up their sleeves to secure it.
In Sydney it will be the receivers from Ferrier Hodgson that will be calling the shots at the auction of 1/64 Ocean, <a target="_blank" href="/news">Woollahrra</a>.
The townhouse is located in one of Woollahra’s premier tree-lined streets opposite Chiswick Park. In a block of only four, the property has three bedrooms and comes with the all-important basement lock-up garage.
<img src="/images/stories/2012/12/oceanst.jpg">
Downsizing baby boomers are expected to be out in force. Peter Starr from McGrath Real Estate says the expectations of the receivers are closely aligned with where he believes the market value lies. He is confident this one will sell under the hammer in excess of $1.5 million.
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A tightly held heritage Prahran property and a Woollahra receivership sale end auction tipping competition season

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Ask anyone nowadays what the property market is doing and they will do doubt refer to the median as a justification of how the market is performing. Unfortunately focusing on the median is like trying to watch a game of footy at the MCG from the Eureka Tower Skydeck. You can see it’s a game of footy but you really have no idea what is going on.
The median is only a guide at best because although it provides a general reflection of the market it tells us very little about what is really happening at ground level.
When we look at the median the numbers can be skewed and manipulated in so many ways.  Let's take a look at the median of two suburbs in Melbourne’s west - Point Cook and Newport.
Point Cook’s median grew from $345,000 in 2006 to $450,000 in 2011. Although the annual compound growth rate was not staggering it was still a respectable 5.46%. But here is the rub.
In 2006 Point Cook had 4195 freestanding houses and in just 5 years that number more than doubled to over 9000. Point Cook has experienced an explosion in construction in recent years but building a new home does not come cheap.  This is because Australia is experiencing a skills shortage driven by an exodus of many workers to the mining states in addition to many young people not wanting to get their hands dirty and avoiding manual work.
The demand for new housing combined with the shortage of supply of people who can build them is resulting in a dramatic increase in the cost of construction of new homes. The result is when we see a lot of new home construction in one area the growth in the median is driven by capital improvements to the land not the appreciation of the land itself.
Newport on the other hand lies around 15klms closer to the CBD and while the median value of houses is significantly higher at $673,000 the annual compound growth over the last 5 years has been an impressive 9.84%.
The story in Newport is strikingly different to that of Point Cook. In 2006 the suburb had a total of 3430 freestanding houses but by 2011, according to the census data, this number had actually fallen back to 3120. Newport has a shortage of land and the decrease in freestanding houses is most likely because the only way to meet demand is to knock down some houses and replace them with units or town houses.
While there is no doubt some houses in Newport have been renovated in recent years in the main capital growth has been a result of land appreciation as apposed to capital improvements.
The property at <a href="https://www.realestate.com.au/property-house-vic-newport-110576633" target="_blank">25 Charlotte Street, Newport, </a>is typical of a house in Newport that has experienced a good level of capital growth. This property was purchased in Jan 2006 for $317,000 and sold a couple of months ago for $500,000. The property had no renovations done during this time.
As a result of these two different drivers we need to interpret the growth in median in Point Cook and Newport in different ways. Growth that is driven by capital improvements will deflate slowly as the improvements slowly depreciate over time. However because land is a finite product when the median is driven by land appreciation it will be in a much stronger position to hold its ground into the future.
 
Mark Armstrong is a director of <a href="https://www.ipropertyplan.com.au/" target="_blank">iProperty Plan</a>, which provides independent analysis and tailored advice to investors and home buyers.
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Don't rely on the median dwelling price as a measure of the market

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A Hawthorn property in auction tipping competition Property Tycoon has sold for well above its pre-auction expectations.
There’s a website, <a href="https://www.propertytycoon.com.au/" target="_blank">www.propertytycoon.com.au</a>, where punters can guess what they think properties will sell for at their weekend auctions in Melbourne and Sydney. This season <a style="font-size: 14px;" href="https://www.propertytycoon.com.au/join-league/S7S123C487R8OOQF" target="_blank" rel="nofollow">Property Observer readers have their own competition, which you can access here</a><a href="https://www.propertytycoon.com.au/join-league/S7S123C487R8OOQF" rel="nofollow">.</a> The winner of the overall competition will win $1,000.
While a small crowd of around 50 people watched the auction at 1/69 Morang Road, <a href="/news">Hawthorn</a> (pictured below), it was left to three bidders to compete for the property. When the hammer fell and the property sold for $592,500 the vendor became one of the rare investors who has outpaced the market in recent years.
<img src="/images/stories/2012/11/morangrd.jpg">
The property was purchased during the height of the 2007 market. Since then the economy has been a minefield for investors, but 1/69 Morag Road, Hawthorn, has delivered a 7.31% compounding return over the last five years. The median value of apartments has been growing by only 4.09% over the same time frame.
You can watch the <a href="https://www.facebook.com/photo.php?v=315523321893619&amp;set=vb.306138129400088&amp;type=2&amp;theater">auction highlights on our Facebook page.</a>
In Sydney it became clear as the campaign went on there was only one buyer who had an interest in purchasing 16 Chuter Street, <a target="_blank" href="/news">McMahons Point</a> (pictured below). In this situation the agents preferred option is to enter into negotiations with the buyer and avoid an auction that turns into a fizzer.
<img src="/images/stories/2012/11/chuterst.jpg">
An auction sale is usually an unconditional transaction, meaning once a contract is signed there is no way out. In this case, however, not only was there only one buyer, but this person was not in a position to buy unconditionally. In most cases it means the deal is subject to the purchaser obtaining finance.
A deal has been struck for 16 Chuter Street, but it will remain under contract until the sale is unconditional.
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Vendor outpaces the market in Hawthorn, but McMahons Point sale held up with finance

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Around $6 million is up for grabs in both Melbourne and Sydney so a good week of tipping could propel you up the leaderboard in this week’s auction tipping competition.
There’s a website, <a target="_blank" href="https://www.propertytycoon.com.au/">www.propertytycoon.com.au</a>, where punters can guess what they think properties will sell for at their weekend auctions in Melbourne and Sydney. This season <a rel="nofollow" target="_blank" href="https://www.propertytycoon.com.au/join-league/S7S123C487R8OOQF" style="font-size: 14px;">Property Observer readers have their own competition, which you can access here</a><a rel="nofollow" href="https://www.propertytycoon.com.au/join-league/S7S123C487R8OOQF">.</a> The winner of the overall competition will win $1,000.
<img src="/images/stories/2012/11/morangrd.jpg">
Elevated in a block of only six in a blue-chip location, it appears 1/69 Morang Road, <a href="/news">Hawthorn</a>, ticks a lot of boxes for investors and first-home buyers. For this reason the property has attracted good interest during the campaign, with more than 1,800 buyers checking it out online.
It has been refurbished in recent years and is just a short walk to train, tram, shops and cafés. Tim Picken from Kay &amp; Burton will auction the property on Saturday and expects bidding in the low to mid-$500,000 range.
Annika Robins from McGrath Real Estate in Neutral Bay has an 1890s workers cottage at 16 Chuter Street, <a href="/news">McMahons Point</a>, up for grabs. The four-bedroom house only sits on 271 square metres of land but is deceptively large.
<img src="/images/stories/2012/11/chuterst.jpg">
It is located in an ultra-convenient position, just a short stroll to ferries, buses, trains and cafes. The property last came onto the market 14 years ago, when it fetched $562,000. It has been renovated since this sale and is expected to sell above $1.75 milion this time around.
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Auction tipping: Blue-chip locations for Melbourne and Sydney properties

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I’ve said it time and again that the residential investment property is a long-term proposition. The property market takes around seven to 10 years to move through a full cycle, from low capital growth/high rental yield to high growth/low yield and back again. 
Despite this, many property investors choose locations and property styles with little potential to survive and thrive throughout market fluctuations. Some investors choose locations that lack the long-term underlying demand to drive capital growth, while others choose property styles that don’t reflect trends in the way people want to live. 
In other words, the property investment decisions that look good today may not prove so attractive in five, 10 or 20 years’ time. It’s essential to understand the nature of long-term economic and demographic trends, then select assets accordingly. 
Interest rates rise and fall, but in the long term, dwindling oil reserves and rising petrol prices will be a key economic trend influencing the property market. In the coming years, rising prices at the pump will make outer-suburban living and commuting less feasible and less appealing. This will curtail the urban sprawl and increase demand among home buyers for property in the middle suburbs close to public transport corridors, shops and schools. 
At the same time, rising property prices in the inner and middle suburbs will put home ownership beyond the reach of more Australians, or at the very least, delay it significantly. Figures from the Bureau of Statistics tell us that the proportion of households renting from private landlords in Melbourne has increased from 22.8% in 2001 to 27.2% in 2011. Almost 32% of Sydney’s property market is inhabited by tenants. 
The increase in tenant demand is not unique to Australian cities. Major global cities such as London and New York have 50% or more of their property tenanted. I am not suggesting we are a London or New York just yet, but we are following a similar path, and there’s every reason to expect that this trend will continue.
Because many tenants want to maintain the trappings of an urban lifestyle, the trend away from home ownership will increase demand for rental properties within walking or short driving distance from trams, trains, shops, cafes and entertainment precincts. For those who can afford to buy, these areas will also be their preferred choice. This two-pronged demand from home buyers and investors will further boost capital growth prospects in the inner and middle suburbs. 
Delaying having children is another trend set to influence the residential market well into the future. The median age for parents is 28.9 for women and 33.1 for men, and women currently have an average of 1.9 children, compared with 2.8 in 1981. 
This trend has resulted in the average number of people per house almost halving over the last 100 years from 4.5 in people to 2.6. In addition, single-person households have jumped from 22.9% to 24.4% over the last 10 years. 
The shrinking size of the family unit means that demand for low-maintenance, compact dwellings will increase, while demand for the conventional sprawling home on a quarter-acre outer-suburban block will soften. 
When you look at all these trends in their entirety, it’s clear that pockets of the middle suburbs close to public transport, shops and schools will provide feasible long-term opportunities for residential property investment, particularly for investors who have been priced out of the tightly held inner suburbs.
Mark Armstrong is a director of <a target="_blank" href="https://www.ipropertyplan.com.au/">iProperty Plan</a>, which provides independent analysis and tailored advice to investors and home buyers.
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How current trends can indicate where to invest in property for the future

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Only two rounds to go in the final season of 2012 and MC, last season’s winner, has risen to the top of the Melbourne leader board. He is less than $100,000 ahead of Rainbow and Jorgo, who are still tied in second place.
There’s a website, <a href="https://www.propertytycoon.com.au/" target="_blank">www.propertytycoon.com.au</a>, where punters can guess what they think properties will sell for at their weekend auctions in Melbourne and Sydney. This season <a style="font-size: 14px;" href="https://www.propertytycoon.com.au/join-league/S7S123C487R8OOQF" target="_blank" rel="nofollow">Property Observer readers have their own competition, which you can access here</a><a href="https://www.propertytycoon.com.au/join-league/S7S123C487R8OOQF" rel="nofollow">.</a> The winner of the overall competition will win $1,000.
Spike has almost $1 million lead in Sydney and is the box seat to take out the title, ahead of Nan63 and Davidk9. However, with around $10 million of property up for grabs in the final two rounds it is not over just yet.
At 213 Station Street, <a href="/news">Carlton North</a> (pictured below), the top end of the quote range was lifted to $900,000 in the late stages of the campaign. This sent a clear signal to the market that it was going to be a competitive auction.
<img src="/images/stories/2012/11/stationst.jpg">
When Tom Roberts from Nelson Alexander started the auction, however, it appeared as though the buyers had stayed home, as he was forced to start with a vendor bid of $800,000. Two bidders eventually came to the party and when bidding stalled at $920,000 the agents went inside to seek further instructions
When the agents returned the words “we are on the market” kicked the auction into another gear as a third bidder emerged. After a flurry of bidding, the property sold $50,000 above the reserve at $970,000.
In Sydney Kerrie Robertson from LJ Hooker sold 28 Coolaroo Road, <a href="/news">Lane Cove</a> (pictured below), under the hammer but has insisted the result in undisclosed.
<img src="/images/stories/2012/11/coolaroo.jpg">
This is the bizarre reality of the Australian property market where a property can be sold in the most public of forums yet the result kept private.
The penultimate round of properties will be revealed at 5pm today.
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Melbourne and Sydney properties sell under the hammer as tipping competition winds down

Developers and apartment buyers have a narrowing window of opportunity before Brisbane's Olympic infrastructure pipeline begins competing directly with residential construction, pushing up costs, tightening labour supply and making new projects increasingly difficult to deliver.

While Brisbane's apartment market continues to benefit from strong population growth and limited housing supply, industry research suggests the years leading up to 2027 could prove to be the most important period for developers looking to secure builders and buyers hoping to purchase before the next wave of price increases.

A new Colliers report, Brisbane 2032 Olympic and Paralympic Games: Creating Solutions, highlights the scale of the challenge. While thousands of new homes are planned across South East Queensland, the Brisbane Olympic Athletes Village alone will deliver more than 10,500 beds during the Games before being converted into around 1,750 to 2,000 apartments. Equivalent to almost two years of typical inner-city apartment supply, the project will also absorb a significant share of the construction workforce and building materials.

The broader construction pipeline paints an even clearer picture.

Construction Skills Queensland's Horizon 2032 report forecasts Queensland's annual construction pipeline will average $69 billion over the coming years before peaking at $75 billion in 2027-28. Demand for construction workers is expected to increase by 17 per cent to almost 150,000 people, with the industry facing an annual shortfall of around 19,000 workers that could blow out to as many as 35,000 during the peak construction period.

The Olympic venues, athletes village and supporting infrastructure will account for billions of dollars worth of work across South East Queensland through to 2032, creating intense competition for labour at a time when Australia's residential construction sector is already under pressure.

[smartcode_project:default project_id=150489 project_image_fid=373834]

Colliers Queensland Residential Director Andrew Scriven said the convergence of these projects is creating a clear window of opportunity for both developers and buyers.

"From 2027 onwards, the market will shift dramatically," Scriven said.

"Labour will increasingly be locked into government-led infrastructure and Olympic projects, which means private residential developments will face higher costs and tighter margins. The developers who move now are the ones most likely to get projects off the ground."

Scriven said the same dynamic would also affect buyers, with fewer apartment projects expected to launch once construction capacity tightens.

"If you're looking to change your lifestyle over the next five years, now is your window of opportunity to buy."

[smartcode_project:default project_id=150713 project_image_fid=373827]

Developers are already positioning themselves ahead of that window.

Following the success of Monarch at Toowong, Consolidated Properties is preparing to launch two new Brisbane apartment projects in the second half of 2026. They include <a href="https://www.apartments.com.au/new-apartments/gloriette-30-bedivere-street-yeerongpilly-qld-4105">Gloriette</a> at Yeerongpilly Green, a 25-storey tower within one of Brisbane's key Olympic precincts, and <a href="https://www.apartments.com.au/new-apartments/castile-47-skyring-terrace-newstead-qld-4006">Castile</a>, a recently approved 25-storey riverfront development at 47 Skyring Terrace in Newstead.

Hutchinson Builders will deliver both projects, with early works already underway at Yeerongpilly and Newstead expected to commence later this year.

The timing comes as Brisbane's fundamentals continue to strengthen, with strong interstate migration, population growth and vacancy rates remaining below 1.5 per cent.

Colliers Queensland researcher Pragya Sharma said Greater Brisbane is forecast to require around 40,000 new apartments between 2021 and 2031.

"There's a real mismatch emerging between when housing is needed and when it will be feasible to build," Sharma said.

"As a result, the period leading up to 2027 presents a key window of opportunity for developers to secure approvals, funding and construction capacity, while buyers will have greater choice before supply constraints intensify."

Colliers research outlines a critical pre-2027 window to start residential projects before labour squeeze: now is the time to buy

Joel Robinson

Developers, buyers on watch in South East Queensland ahead of construction crunch: Colliers

It's taken less than nine months for developer Sherpa Property Group to sell out all 51 apartments in its <a href="https://www.apartments.com.au/new-apartments/flourish-oasis-palm-beach-7-9-sixth-avenue-palm-beach-qld-4221">Flourish Oasis</a> development in <a href="https://www.apartments.com.au/developments/palm-beach-qld-4221">Palm Beach</a>, over a year before its anticipated completion.

&nbsp;

Located at 7-9 Sixth Avenue, the $67 million development has resonated strongly with both local owner-occupiers and downsizers seeking high-quality apartments within walking distance of the beach, dining precincts and everyday amenities.

[smartcode_project:default project_id=151449 project_image_fid=357458]

Christie Leet, Founder of <a href="https://www.apartments.com.au/developers/sherpa-property-group">Sherpa Group</a>, said the sell-out reflected both the strength of the Palm Beach market and the success of Sherpa's community-first approach to development.

"The sell-out of Oasis is a fantastic outcome and reinforces the strong demand we're seeing for thoughtfully designed apartments in lifestyle locations," Leet said.

"From the outset, our vision was to create a development that genuinely enhanced the Palm Beach community while providing residents with exceptional homes and wellness-focused amenities.

"We've been incredibly encouraged by the level of local support throughout the campaign, 72.5 per cent of buyers are locals, with a significant proportion of purchasers choosing Oasis as their future home rather than an investment."

[smartcode_project:default project_id=151449 project_image_fid=357463]

Construction is now progressing following development approval, with trusted builder LPS Group delivering the project and completion anticipated in Q3 2027.

Oasis forms part of Sherpa Group's successful Flourish collection, which has become recognised for its focus on wellness, community and elevated coastal living.

[smartcode_project:default project_id=151449 project_image_fid=357469]

Residents will have private access to a rooftop amenity space featuring a pool, gym, sauna, steam room, hot and cold plunge pools, spa and barbecue facilities.

"The success of Oasis demonstrates that buyers continue to prioritise quality, location and lifestyle," Leet said.

"We are proud to have delivered a project that has resonated so strongly with the market and look forward to bringing Oasis to life for our future residents."

Sherpa recently launched <a href="https://www.apartments.com.au/new-apartments/flourish-soleira-palm-beach-1150-1160-gold-coast-highway-palm-beach-qld-4221">Flourish Soleira</a>, its third instalment of the Flourish brand in Palm Beach following Flourish Oasis and <a href="https://www.apartments.com.au/new-apartments/amargo-6-12-sixth-avenue-palm-beach-qld-4221">Flourish Amargo</a>.

[smartcode_project_cta:default project_id=151449]

Sherpa sells out Flourish Oasis in booming Palm Beach

Urban Property Group's <a href="https://www.apartments.com.au/new-apartments/la-vera-macquarie-park-94-talavera-road-macquarie-park-nsw-2113">La Vera</a> is leading the next phase of Macquarie Park's residential evolution, with the new apartment development set to become the first of several new apartment projects in the precinct to complete.

The 169-apartment building has now topped out ahead of its scheduled completion in the third quarter of 2026, as new residential investment continues to reshape one of Sydney's largest employment hubs into a true mixed-use precinct.

[smartcode_project:default project_id=134951 project_image_fid=368645]

Cox Architecture has designed La Vera to capture the best of its unique positioning on Talavera Road, orienting the building towards Lane Cove National Park.&nbsp;The building features a sculpted northern façade with flowing curves inspired by the surrounding landscape, while its city-facing elevation adopts a more structured architectural expression to maximise skyline views.

"The vision for the project was to conceive a building that adopted an organic and curvilinear form to the northern portion that faces the Lane Cove National Park," <a href="https://www.apartments.com.au/architects/cox-architecture">Cox Architecture</a> Director Felipe Miranda said.

"The residents that reside in the northern portion of the building benefit by having beautifully crafted curved balconies that speak to the natural context and heighten the relationship of their internal living spaces to the external balconies."

[smartcode_project:default project_id=134951 project_image_fid=358802]

La Vera offers a diverse mix of one, two, three, and four-bedroom configurations, with prices currently starting from $740,000. Buyers so far have been a mix of Sydney-based investors,&nbsp;metro commuters, owner-occupiers and downsizers from surrounding North Shore suburbs.

Both investors and owner-occupiers have been drawn to La Vera's proximity to Macquarie University, Macquarie University Hospital, Macquarie Centre and the Sydney Metro, infrastructure that supports both strong rental demand and a convenient lifestyle for residents.

The apartments feature full-height glazing, timber flooring throughout living areas, stone kitchen benchtops, SMEG appliances, floor-to-ceiling bathroom tiling and ducted air conditioning.

Residents will have access to a rooftop recreation level featuring a swimming pool, sauna, barbecue facilities and landscaped relaxation areas, complemented by additional communal space at ground level. Many apartments enjoy uninterrupted views across Lane Cove National Park, reinforcing the project's connection to its natural setting.

[smartcode_project:default project_id=134951 project_image_fid=364551]

<a href="https://www.apartments.com.au/developers/urban-property-group">Urban Property Group</a>, a family-owned developer and builder with nearly four decades of experience, holds a 4.5-star iCIRT rating and was Australia's first developer to introduce 10-Year Latent Defects Insurance (LDI). La Vera is the first apartment development in <a href="https://www.apartments.com.au/developments/macquarie-park-nsw-2113">Macquarie Park</a> approved to offer the additional insurance protection, alongside a five-year warranty on SMEG appliances.

Urban Property Group CEO Patrick Elias said the additional protection reflects changing buyer expectations in the off the plan market.

"Consumers are a lot more weary and a lot more concerned in buying off the plan than they ever have been. Having LDI is a tool to portray the confidence that we have in our product, and a confidence we want buyers to share," Elias said.

Following completion of the building later this year, buyers will move into their apartments well before Christmas.

[smartcode_project_cta:default project_id=134951]

La Vera closes in on completion as Macquarie Park continues residential transformation

Brisbane developer Red &amp; Co's decision to include dual key apartments in its debut Gold Coast apartment development, <a href="https://www.apartments.com.au/new-apartments/como-varsity-lakes-22-lake-street-varsity-lakes-qld-4227">COMO Varsity Lakes</a>, is proving to be one of the project's biggest drawcards, with buyers quickly snapping up the flexible residences.

More than half of the project's 36 dual key apartments have already sold, helping drive COMO beyond the 50 per cent sold mark within the first month of launch.

The strong response highlights growing demand for apartment designs that can adapt to changing lifestyles, with buyers increasingly looking for homes that accommodate multi-generational living, provide rental income opportunities or simply offer greater flexibility over time.

Located on the shores of Lake Orr, COMO will deliver 156 apartments across 16 levels, with the dual-key residences forming a limited release within the broader development.

Each combines a primary two-bedroom apartment with a fully self-contained studio on a single title, connected by a shared foyer and lockable internal door. The design allows owners to house ageing parents, adult children or guests while maintaining privacy, or lease the secondary residence to generate additional income.

Just 17 of the original 36 dual key apartments remain available.

[smartcode_project:default project_id=135546 project_image_fid=367096]

The innovative configuration combines two fully self-contained residences on a single title, typically comprising a primary two-bedroom apartment alongside a separate studio residence, connected via a shared foyer and lockable internal door.&nbsp;

The model is proving particularly attractive to owner occupiers navigating changing family dynamics and the realities of the current housing crisis.&nbsp;

[smartcode_project:default project_id=135546 project_image_fid=363511]

<a href="https://www.apartments.com.au/project-marketer/npa">NPA</a>&nbsp;CEO Andrew Erwin said dual key living was resonating strongly with modern buyers because it delivered both financial flexibility and practical lifestyle benefits.&nbsp;

“The housing crisis and rising cost of living are fundamentally changing how Australians think about home ownership,” Erwin said.&nbsp;

“Dual key apartments provide a genuine solution for families who want to stay connected while maintaining independence. Parents can help adult children save for a future home, ageing parents can remain nearby without moving into aged care, and owners still retain privacy and flexibility.

“Importantly, buyers are also recognising the financial advantages. It creates the opportunity to generate additional income from part of the home without the holding costs associated with owning a separate investment property.”&nbsp;

[smartcode_project:default project_id=135546 project_image_fid=363509]

Unlike traditional dual occupancy arrangements, the residences operate under a single title, meaning owners only incur one set of body corporate fees, council rates and holding costs.&nbsp;

The secondary residence can also evolve over time - functioning as guest accommodation, a home office, creative studio or private retreat before later becoming an income-producing asset.

<a href="https://www.apartments.com.au/developers/red-co">Red &amp; Co</a>&nbsp;Director and Co-Founder David Laverty said the strong early sales reflected growing buyer urgency and changing priorities within the market.&nbsp;

“Securing more than half of COMO’s residences within such a short timeframe is an outstanding result and a clear endorsement of both the design and location,” Laverty said.&nbsp;

“Buyers are responding to the combination of location, connectivity and amenity, but ultimately it’s value relative to other East Coast markets that is driving enquiry.”&nbsp;

“We’re also seeing strong interest from owner occupiers looking for homes that can adapt with them over time. Flexibility has become one of the most important considerations for buyers in today’s market.”&nbsp;

[smartcode_project:default project_id=135546 project_image_fid=363515]

Designed by <a href="https://www.apartments.com.au/architects/bda-architecture">BDA Architecture</a>, COMO features a mix of one-, two- and three-bedroom residences with 2.7-metre ceilings and larger-format floorplans aimed at owner occupiers, downsizers and lifestyle-focused buyers.&nbsp;

The development will feature an extensive rooftop recreation and wellness offering including a 25-metre lap pool, sundeck, barbecue and dining areas, gym, sauna, plunge baths, landscaped gardens, wellness spaces and rooftop pickleball and paddleball courts.

The remaining dual key apartments range from 137 sqm to 167 sqm and include generous three-bedroom layouts with separate self-contained studio accommodation and dual parking.&nbsp;

Erwin said the dual key concept represented a broader shift in how Australians would live in the future.

“People want homes that can evolve with their lives,” he said.&nbsp;

“A dual key apartment can suit a family today, support an ageing parent tomorrow, and potentially generate income later on. That adaptability is becoming incredibly valuable in the current environment.”

Prices currently range from $2,115,750 to $2,583,000.&nbsp;

[smartcode_project_cta:default project_id=135546]

Inter-generational living drives demand for COMO’s dual key apartments as housing pressures reshape buyer priorities 

Builder-developer&nbsp;<a href="https://www.apartments.com.au/developers/ceerose">Ceerose</a> has doubled down on its Leichhardt ambitions, lodging its second State Significant Development Application (SSDA) in the suburb in the last six months.

Their newest proposal seeks to transform a former industrial precinct into a new residential community centred around the adaptive reuse of one of the site's heritage warehouse buildings.

The new project, on a 6,930 sqm block at&nbsp;<a href="https://www.apartments.com.au/new-apartments/40-76-william-street-leichhardt-nsw-2040">40–76 William Street</a>, will bring more than 200 apartments to a suburb that has seen little to no new supply in recent years. It follows Ceerose's late 2025 SSDA for a mixed-use apartment project on nearby Parramatta Road, signalling the developer's growing investment in Sydney's Inner West.

Ceerose Founder Edward Doueihi told Apartments.com.au the developer’s long-standing presence in Leichhardt and the Inner West had given it a strong understanding of how the area has evolved and where its future opportunities lie.

“Ceerose has had a long-standing presence in Leichhardt and the Inner West, giving us a unique understanding of the area’s evolution and future potential,” Doueihi said.

“Having delivered projects throughout the region, we have witnessed the suburb’s transformation first-hand and understand the opportunities for its continued growth.”

Doueihi said that understanding also informed the planning process, with a comprehensive Stakeholder Engagement Outcomes Report prepared before the application was lodged.

The report identified the key issues and concerns raised by neighbouring residents and other stakeholders, allowing those matters to be considered and incorporated into the design where appropriate.

He said the delivery of additional housing would also play an important role in supporting the revitalisation of Norton Street and the Italian Forum.

“By increasing the local residential population, the development is expected to strengthen demand for local businesses, encourage further investment, and help restore the vibrancy that made the precinct a thriving destination in the early 2000s.”

<img alt="First look: Ceerose returns to Leichhardt with 203-apartment adaptive reuse proposal at former warehouse site" data-entity-type="file" data-entity-uuid="7258c54c-8167-479e-8361-2d5fca9915b4" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Appendix%2010B%20-%20CGI%20-%20View%202.jpg?VersionId=S9DQfxu_jpcB5LrAEYFUbyMzg5odW6i5" />

Designed by <a href="https://www.apartments.com.au/architects/woods-bagot">Woods Bagot</a>, the redevelopment would involve the demolition of four existing industrial buildings while retaining and adaptively reusing the site's most significant warehouse. The retained structure would anchor a new residential precinct comprising five interconnected buildings arranged around a large central landscaped courtyard, with heights stepping from five storeys along the surrounding residential streets to 11 storeys at the William Street corner.

According to the Architecture Design Report by Woods Bagot, the proposal "seeks to create a residential village centred around a generous green heart while celebrating the site's industrial heritage through the adaptive reuse of the existing warehouse building."

The development would comprise 203 apartments, with 188 proposed as build-to-sell residences, alongside 15 affordable housing apartments.

Rather than treating the retained warehouse as a standalone heritage object, Woods Bagot has sought to weave the site's industrial history throughout the masterplan. The proposal retains the north and west facades of the landmark corner warehouse, while new buildings reinterpret the site's brick-and-steel industrial language through their material palette and architectural expression.

<img alt="First look: Ceerose returns to Leichhardt with 203-apartment adaptive reuse proposal at former warehouse site" data-entity-type="file" data-entity-uuid="9e8c64c2-881b-49e1-8c90-6b6acaaa45b6" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Appendix%2010C%20-%20CGI%20-%20View%203.jpg?VersionId=Qm8_8H_Xrg_sc4Mdjc59vlAcKF_5wRTb" />

The design is organised around what Woods Bagot describes as a "green heart", a landscaped communal open space that reinstates the leafy character removed when the site became an industrial storage facility. A new pedestrian laneway running through the site would improve permeability between William, North and Francis streets, linking residents through landscaped public spaces while activating the ground plane.

Residents would have access to communal gardens and shared recreation areas distributed throughout the development. Sustainability has also been prioritised, with the project targeting an average 7.9-star NatHERS rating. Proposed initiatives include rooftop solar generation, rainwater harvesting, passive solar design, naturally ventilated lobbies, extensive cross-ventilation and the reuse of existing building fabric to reduce embodied carbon.

The adaptive reuse strategy became a defining feature of the application after heritage investigations found only one of the site's industrial buildings could feasibly be retained. The Heritage Impact Statement concludes that preserving the key warehouse façades while referencing the site's industrial character throughout the new development provides an appropriate balance between renewal and conservation.

<img alt="First look: Ceerose returns to Leichhardt with 203-apartment adaptive reuse proposal at former warehouse site" data-entity-type="file" data-entity-uuid="efffafdb-594f-4e2b-a067-921fd51c05e1" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Appendix%2010D%20-%20CGI%20-%20View%204.jpg?VersionId=DPmE4.k16YRt0i27hEZVtJAffarpvUfx" />

"Retention and adaptation of the site buildings has been explored but found not to be feasible except for the tallest building, whose street facades will be retained," the heritage report states.

"The proposed building will interpret the brick and steel character of the subject site, including reuse of some components and construction of a large 'sawtooth' structure in the proposed open space."

<img alt="First look: Ceerose returns to Leichhardt with 203-apartment adaptive reuse proposal at former warehouse site" data-entity-type="file" data-entity-uuid="3bfef2b5-83f5-40cd-9cab-767092f34266" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Appendix%2010E%20-%20CGI%20-%20View%205.jpg?VersionId=7asb3i_ql4ybbuJOUb5UHBEIy0Q9t.DF" />

The William Street site is located around 300 metres from Leichhardt North Light Rail station and a short walk to Norton Street's retail, dining and hospitality precinct. The surrounding area has increasingly become a focus for urban renewal given its proximity to public transport and the Parramatta Road corridor.

Doueihi founded Ceerose in 1998 and has grown the business to become one of Sydney's more active apartment developers in recent years, with completed projects including The Alex Collective in Alexandria, Abbie's Lane in Annandale, and the award-winning Munro House in Elizabeth Bay. They are currently delivering Belgravia, 17 luxury apartments in Potts Point.

Mark Armstrong

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