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<a target="_blank" title="The pitfalls of renting from your self-managed super" href="https://www.propertyobserver.com.au/tools/legal/the-pitfalls-of-renting-from-your-self-managed-super/2011062050544">Yesterday </a>we looked at some of the benefits – and drawbacks – of renting your family business premises from your self-managed super fund. It is a common arrangement, but you should make sure you are protected.
Here are eight key points to consider before a family business decides to rent its premises from the family’s SMSF:

1. Think about what could go wrong before entering the arrangement.
 There would be a natural tendency to concentrate on the positives, but plenty of other problems could arise apart from the family business being unable to pay its rent.

Peter Bobbin, a principal of Argyle Lawyers, emphasises that the SMSF might be forced to sell the premises to pay benefits to members following a marriage break-up, death or disability. Indeed, the marriage of a couple who are both business partners and SMSF members might end in divorce.

In turn, the forced sale of the premises to pay member benefits may damage the family business.

2. Don’t let possible tax advantages dominate your decision-making: “Understand the commercial and legal risks,” advises Bobbin, who describes tax-dominated decisions as “misguided”. Bobbin’s specialties include SMSFs, tax and family businesses.

3. Understand the fund’s obligations to pursue unpaid rent – even from its members’ own business.
 “A fund super fund must use all usual means to collected unpaid rent,” Bobbin says, “and commonly should have personal guarantees for any arrangement with a business.

“If the business fails, the fund will need to press the personal guarantees – even with the members themselves.”

4. Recognise what actions the SMSF regulator could take concerning unpaid rent by the fund members’ business:
Martin Murden, a director of Partners Group, financial services provider to accountants, says possible actions for breaching the Superannuation Industry (Supervision) Act include fines, the trustees being disqualified or the fund being declared non-complying.

The market value of non-complying funds is taxed at the top marginal rate, less any non-concessional or undeducted contributions. In short, this can wipe out almost half a fund’s assets.

5. Understand your fund could lose ownership of geared property.
 Murden says that if your business can’t pay rent to your SMSF, your fund could fail to make instalments on its investment loan. “If your fund can’t meet its loan instalments, the bank will want its money back [plus its costs].”

And Murden says the fund could lose its investment and the family business could lose the use of its premises.

6. Question whether your SMSF can really afford to gear a commercial property – no matter whether your own business will become the tenant. 
Murden says funds should take into account the levels of debt already being carried by the SMSF, the business and the business owners in a personal capacity.

He suggests that funds should consider the effect that the next halving of the standard cap on concessional contributions for super fund members over 50 could have on their fund’s cash flow and ability to make loan repayments. (This cap will fall to an indexed $25,000 from July next year.) Many funds require the cash flow from high concessional contributions to meet all of their loan obligations.

Funds should also assess how impact of future interest rate rises on the ability to make loan repayments, Murden says.

7. Decide whether your business may be better off renting its business premises from an unrelated landlord.
Murden says funds shouldn’t rent business premises to their own businesses simply because it is allowed under superannuation law.

Some SMSFs would be tougher with an unrelated tenant than a related one. And that approach may not be in the fund members’ best interests.

8. Ensure your fund is adequately diversified if possible.
 This will mean that the fund members’ savings are not overly dependent on the profitability of a single costly asset, name your business premises.
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Eight considerations before renting from your SMSF

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One of the biggest challenges a self-managed super fund can face is when the tenant of a highly valuable, fund-owned commercial property fails to pay the rent.
Much of the fund’s financial wellbeing may depend upon regular payment of rent – particularly if a heavily geared property is the fund’s sole or dominant asset.
The fund, of course, would be expected to take all necessary action to try to recover the overdue rent and, if necessary, remove the financially troubled tenant from the premises.
But imagine how the difficulties for your fund could escalate if the wayward tenant were your family business.
Be warned, many family SMSFs and family businesses are at risk of becoming embroiled in such inter-family disputes.
“Many of the businesses we see now see are struggling,” says Martin Murden, a director of Partners Group, financial services provider to accountants. He is the author of How to Invest in Property Through your Self-Managed Super Fund, recently released by Major Street Publishing.
Before entering a landlord-and-tenant arrangement between your business and your super fund, Murden, an SMSF specialist, urges his clients to think about what could go wrong.
It is a common practice for a family SMSF to own the premises of the family business in order to gain a range of retirement, tax, business, and asset-protection advantages.
Your family business pays a commercial rent to your family SMSF. And your fund claims tax deductions for interest on the loan to buy a typically geared property.
Further, the property is generally out of the reach of creditors if individual fund members are declared bankrupt – subject to claw-back provisions in the Bankruptcy Act.
And if your SMSF sells the property once fund assets are backing the payment of a pension, no capital gains tax is payable on the sale.
It can, however, be a matter of conflicting loyalties and pressures if your business encounters financial problems and fails to pay its rent.
On one side, the family business may require those premises to keep operating in the hope that profits will return. (In a many cases, a business than cannot pay rent to its own SMSF will struggle to pay rent to another landlord – even for poorer-quality premises.)
Yet on the other side, the fund’s trustees – who are the same people as the business owners in these circumstances – are legally obliged to maintain the fund with the sole purpose of providing member retirement benefits.
In any case, Murden says SMSFs with commercial properties generally have to borrow to buy and require regular rent to meet their loan repayments.
Businesses experiencing financial difficulties usually become slower to pay their creditors. And Murden says a decision is sometimes made, consciously or unconsciously, that the last creditor to pay is their owner’s self-managed super fund.
He stresses that if a member’s business is not paying its rent to the family SMSF, the retirement savings of the members are being jeopardised.
Murden’s firm is currently advising an accountant regarding a business that cannot pay its rent to the business owners’ SMSF. He has raised such questions with the accountant as: How good is the business? Should the business move into cheaper premises to enable the SMSF to find another tenant?
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The pitfalls of renting from your self-managed super

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In <a target="_blank" title='Read "Why invest in US housing"' href="https://www.propertyobserver.com.au/trends/international/american-dream-or-nightmare/2011060550324">part one</a> of our series on investing in the depressed US property market, Property Observer talked about who was buying up US housing stock, how and why. In the second part of the series, we discuss the pitfalls of investing in the US property, which might be cheap for a reason.
 
What are the traps?
Australian buyer’s agents point to underhand methods allegedly adopted by some of their competitors.
Hidden commissions: “Every day I am offered upwards of 10 per cent commission ‘if you sell this property to one of your clients’,” says Redman. “We don’t work that way.” He agrees that buyer’s agents who accept such commissions are ripping off their clients.
Redman says some Australian companies have arrangements with American companies to earn a 20 per cent sales commission or to load the price of a property by 20 per cent.
 Two-tier pricing: Redman says it is common practice for agents to list one price for Americans and a much higher price for Australians.
“We have one property for $42,000 and they [another Australian-based company] are charging $62,500 for the same property,” Selleck says.
 Redman claims some Australian companies take an option to buy a <country-region><place>US</place></country-region> property for, say, $30,000 and then market it in <country-region><place>Australia</place></country-region> for $60,000.
"Flipping": US-based “flippers” buy a US property and “flip” it a short time later to Australian buyers at much higher prices. The flippers add little or no value before reselling a property.
“Some Australian companies buy a US property very cheaply, whack a bit of paint on it and then sell it for triple what they paid for it,” Redman says.
 Misleading rental yields: Promoters of US properties quote net annual yields of 10% and more. But such yields, unless sustainable, can give buyers a misleading impression of a property’s value.
 A buyer’s agent told Property Observer that some operators place a tenant in a property for an exorbitant rent that would produce yields of up to 25% if sustained and then sell the property to an Australian. But within a few months, the tenant has often moved elsewhere and the property falls into disrepair.
Jenman says low <country-region><place>US</place></country-region> interest rates mean that if an American can obtain a housing loan, it would be much cheaper to buy than pay high rents.
Unfamiliar markets: We all know parts of our local city or state that astute property investors wouldn’t go near. Of course, it’s the same story in the US. “Some areas are ghettoes that resemble war zones,” Jenman says. Investing away from home is often a high-risk strategy.
What is the outlook for US housing?
Based on just a sample of the economic and sales data available, the outlook for <country-region><place>US</place></country-region> property is far from promising.
US Federal Reserve chairman Ben Bernanke said in a recent address that the poor state of the <country-region><place>US</place></country-region> housing market was holding back the <country-region><place>US</place></country-region> economic recovery.
 Bernanke stressed that foreclosure rates remained very high and many “underwater” homeowners avoided foreclosure by holding on to their homes even though the size of their mortgages exceeded their homes’ value. Additionally, long-term unemployment remained at a historic high, he said.
RealtyTrac, the US online marketplace for foreclosure properties, reports that there were almost 700,000 foreclosures in the first quarter of 2011, a 15 per cent decrease on the previous quarter. But it seems that fall is largely attributable to a backlog of thousands of foreclosures as lenders address improperly prepared mortgage documents.
 RealtyTrac warns of weak demand, declining home prices, lack of credit and the threat caused by the “looming shadow inventory of distressed properties” that are yet to reach foreclosure stage. In short, RealtyTrac expects the foreclosure rate to rise.
 Is investing in US a good idea?
The risks appear excessively high.
For example, Jenman knows an Australian who lost most of her money after the three properties she bought in upstate New York failed to rise in value. She bought one property for $US34,900 and sold it four years later for $US12,000. Another she bought at the same time for $US51,900 she sold years later for $US25,000. The third remains unsold.
I believe if you go over to America, hire a car, drive around and research the areas properly, you might be able to find yourself a good buy,” Jenman says. “But I believe with all of my heart if you go through an Australian company that is flogging American real estate here in <country-region><place>Australia</place></country-region>, you will almost certainly lose a great deal of money.”
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America: buyer beware

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The website of Byron Bay-based buyer’s agent 888 US Real Estate features principal Vincent Selleck proudly planting the Australian flag on the White House lawn. The image conveys a conquering Australian, dressed in shorts.
 The Huffington Post presents another picture of US property. The news website asks for readers’ photographs of “America’s foreclosure ghost towns”. Photograph upon photograph shows boarded-up wrecks of houses, covered in graffiti and decay.
 Looking at <a target="_blank" title="Huffington Post" href="https://www.huffingtonpost.com/2011/04/13/americas-foreclosure-ghost-towns_n_848715#s264053&amp;title=Chicago_Englewood_Neighborhood">these photographs</a>, it would take a truly brave Australian investor to try to take advantage of <country-region><place>America</place></country-region>’s property troubles. 
 However, Selleck says the growth in the number of Australians investing in <country-region><place>US</place></country-region> property is “enormous”, particularly over the past six months. And he says that the US market offers “insane” value.
 Property consumer advocate Neil Jenman puts it another way: “You would be insane to buy it.”
 Jenman says thousands of Australians are pouring money into US properties as countless companies target Australian buyers. He is convinced that almost all Australian investors will suffer huge losses when their properties are eventually sold. But Selleck says US property is a smart investment, and Australians are “moving to where the market opportunity is at the moment”.
 Property Observer spoke to those on both sides of this debate and examined the outlook for the US housing market. Over a two-part series we attempt to answer the question: Does US property present a money-making opportunity or looming disaster for Australian investors?
 What’s attracting buyers?
According to the proponents of US residential property, the combination of homes selling at way below replacement value, claimed double-digit net rental yields and the high Australian dollar are creating amazing bargains for Australians.
 For instance, Selleck has just listed a freestanding five-year-old, three-bedroom house in Phoenix, Arizona, for $US52,000 (about $A48,800). “It rents for $US900 a week, and the replacement value is anywhere from $US120,000 to $US180,000,” he says.
 “So you are buying real assets for a fraction of their real value. You can’t do that anywhere else in the world; it’s a once-in-a-lifetime opportunity.”
 Before the GFC, the Phoenix house had sold for $US167,000.
 Who’s investing in America?
Cashed-up individual investors and self-managed super funds are reportedly the main buyers of US housing stock, as Selleck says Australian banks won’t accept US property as security for a loan. His firm has found only private lenders in the US, which charge high interest rates, willing to lend to Australians.
 Selleck says Australian buyers – apart from self-managed super funds – either use Australian properties as loan security or finance their purchases with the proceeds from the sale of investments.
 Daniel Redman, managing director of Melbourne-based buyer’s agent US Property Direct, says many Australian buyers have borrowed against the equity in their homes.
 How are they investing?
Many Australian investors buy through Australian-based buyer’s agents who have contacts with US real-estate agents or US property wholesalers that purchase foreclosed properties in bulk from banks.
 Jenman says some Australian property spruikers hold joint Australian seminars with their visiting US associates to promote US property.
 Selleck explains that US wholesalers might buy 100 properties at a time from banks, sight unseen. “They might find that 90 of the 100 properties are worth something and the remaining 10 are throwaway,” he says.
 Wholesalers, Selleck says, renovate the properties and find tenants. “We won’t close on a property until a lease is taken out, generally for 12 months at the agreed price.”
 Selleck says he charges a flat $3800 fee to his clients. “We don’t take any commissions.” The buyers pay all costs such as for legal work and building inspections. Redman of US Property Direct says his firm charges $3495 to clients; it also did not accept commissions from vendors or their agents.
 
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American dream or nightmare?

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A drastic undersupply of housing to accommodate Australia’s growing population has led to extremely low rental vacancy rates. The national vacancy rate is hovering around 1%, and in some places it is even lower.
Investors are beginning to come back into residential property, believing it to be a landlord’s market. But experts are urging caution, as house prices are expected to fall this year, particularly at the lower end of the market.
Here are some points to consider before diving into the residential housing market.
1. Understand that the undersupply is not going to be addressed quickly.
Angie Zigomanis, industry analyst and economic forecaster for BIS Shrapnel, says there are simply not enough properties for rent, which is forcing up rents and yields.
“There is a deficiency of stock in most capital cities," he says, "with Sydney most of all."
Despite strong construction in capital cities such as Melbourne, developers have still not been able to meet demand caused by Australia’s fastest population growth since the baby boom of the 1950s and ‘60s.
2. Understand that the best buying time has passed
Matthew Bell, economist for Australian Property Monitors (APM), says the best time to buy was a few years ago, when interest rates and prices were at their lowest. 
Louis Christopher, managing director of property adviser and forecaster SQM Research, agrees now is probably not the best time to get into the market, especially as prices aree likely to level out or fall over the next year.
3. Think about the movement of interest rates
With interest rates at 4.75% and many experts predicting they will rise even further, investors should be wary of biting off more than they can chew.
4. Check relative yields
While yields on rental properties are high, Christopher suggests would-be investors compare the higher yields on such alternative investments such as fully franked shares.
5. Realise that vacancy levels are not low across the board
“There are significant areas where vacancies are rising," warns Christopher. Do your research, because if you buy an investment property in an area with a vacancy rate of more than 3% it will be almost impossible to raise the rent.
6. Consider impact of banks requiring higher loan-to-valuation ratios
"By default, this will reduce the number of borrowers [in the lower end of the market]," Christopher says. In turn, this could be detrimental for prices.
However, although Bright says higher loan-to-valuation ratios will prevent many first home buyers from entering the market, that could strengthen the property market because there would be fewer forced sales.
7. Don't overlook the effect of the cutting of concessional super contribution caps.
The reduction of the caps on these contributions, which include salary-sacrificed, SG and tax-deductible contributions by the self-employed, is expected by some financial planners to encourage more investors to gear non-superannuation investments including residential property.
8. Choose your investment buy carefully
Bright says the best buys for investors are a step up from first-home buyer points. For example, he says the best buys in Sydney are those of $750,000 and above, in particular the $1 million to $2 million bracket.
9. Think about what will appeal most to tenants
Bright says in general, quality properties are near transport, activity centres, shops, entertainment centres and business centres, particularly in cities.
"Other factors such as a secure building, pleasant outlook and a balcony are highly desirable," he says, "while off-street parking can be a deal-maker or breaker, particularly in the very busy suburbs close to the city centres."
He warns investors to stay away from areas with an oversupply of properties for rent, unless they can secure sites with a point of difference, like a penthouse with knockout views.
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9 things to consider before buying investment property

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With rumblings in the media about the Australian property bubble bursting and prices starting to come down, it might seem like the time to find yourself a property bargain. But property forecaster Louis Christopher says bargains are thin on the ground.
Christopher, managing director of property adviser and forecaster SQM Research, says even though it is slowing down, the Australian property market is not ripe for bargain-hunters. Many segments of the market are overvalued, and the withdrawal of the first-home buyer’s grant combined with higher interest rates are likely to result in a lacklustre 2011. However, that doesn’t mean there is not good value anywhere.
Potential bargains now on the market include these three examples, taken from the Home Discounts Report, published by <a href="https://www.sqmresearch.com.au/homediscounts/">SQM Research</a>.
<ul>
<li>A three-bedroom house in the Adelaide suburb of Elizabeth Grove with a huge backyard, on the market for $159,950. This is 53% less than its asking price when it first came on the market more than 500 days ago.</li>
</ul>
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<li>A five-bedroom house in good condition in Dunalley, Tasmania, with water views, beautiful gardens and a dam on a 7.37-hectare site is listed at $395,000. The price was cut by 47% during its more than 800 days on the market.</li>
</ul>
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<li>A four-bedroom waterfront property on Russell Island in Queensland is selling for $449,000. The property, which has a huge backyard with mature trees, has been on the market for more than 900 days and the price has come down 39%.</li>
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Here are eight top tips for bargain-hunters:
1. Only fools rush in: “Look now, don’t rush,” Christopher suggests. “The only trouble in trying to theoretically work out whether you have a bargain is that it may be a bigger bargain tomorrow because the market continues to fall.
2. Time it right: The best time to buy is at the bottom of a market trough, just before prices start to rise again. But as Christopher rightly points out: “No one rings a bell at the bottom of the market.”
However, that does not mean it is impossible to know when the right time is to buy. “Potentially, there could be bargains towards the end of this year [if most national markets have stopped falling by then],” Christopher says.
Buyers should study the market closely now to be ready to buy when the time is right and they have found the right property to suit their needs.
3. Be especially wary in over-priced areas: Darwin is “massively over-valued,” according to SQM, and properties in south-east Queensland and Perth are selling for far more than they should. Christopher says housing markets in these and other over-valued regions will remain sluggish or will continue to correct. If interest rates rise again this year, that could cause prices to fall further.
4. Everything is harder in Sydney – but that does not mean impossible: Sydney prices are rising, making bargains even more difficult to find. “In the next three years, I am not expecting any dramatic falls in Sydney,” Christopher says.
But that does not mean it is impossible to buy in Sydney. There are fewer bargains than in other capitals, but there is also much less risk that the price of an apparent bargain will fall after purchase – provided that you buy into a sought-after suburb.
“When a market is on the move, what someone paid for a very similar property a month or two ago can look like a bargain,” Patrick Bright, chief executive of buyers’ agent EPS Property Search in Sydney, says.
Bright says most deals that seem too good to be true usually are. He warns that buyers of properties with “something that’s not good about them” will either have to fix the fault or flaw or will have to sell the property at below market rates for the area.
However, some properties are listed at below market value because owners had initially asked too much and have cut the price out of desperation to sell.
What types of properties should savvy Sydney bargain-hunters look out for? “Stick to the inner ring, three to 15 kilometres from the CBD,” Bright says. He says buyers should look for properties close to beaches or those with harbour views.
“Correct property selection for the particular suburb is critical,” says Bright, “if you want to achieve a better-than-average return.”
Dennis Kalofonos, director of Sydney Property Finders, urges caution. “It is too early [in the year] to predict whether a property is a bargain or not,” he says.
“I think there needs to be a few more weeks and a couple more auction phases to go through to get a really good idea of where the pulse of the market and the direction it’s going.”
Kalofonos says suburbs with houses with large gardens that are still close to the city could be good value. He says these markets have risen dramatically as couples with young children move out of the inner city and into the closest suburbs to the CBD with big backyards.
“There’s no lawn in Paddington and Queens Park [inner eastern Sydney suburbs] and those suburbs are so expensive,” Kalofonos adds.
5. Watch for desperate vendors: Christopher says some vendors in areas with falling prices become desperate to sell and lower their prices below market rates.
6. Look for properties on the market a long time: Prices will sometimes fall on properties that have been on the market for more than two months.
Marketing of these properties often follows a pattern: vendors start off asking too much; agents lose interest, sometimes even warning prospective buyers that the house is overpriced and the vendor is difficult; vendors become desperate to sell; vendors cut the price heavily, sometimes below market value.
7. Monitor housing supply levels: When the supply of housing is rising sharply, buyers are in a much stronger position to negotiate for good deals.
According to figures compiled by SQM Research, the number of listings in Australia rose by more than 40% last year. Sydney had the lowest rise in housing supply, at 19.5%.
8. Future rezoning can increase value: Kalofonos says that housing with views over industrial areas could be worth buying, as they will be much more expensive if the land is rezoned to residential and new housing is built on former factory land.
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How to find property bargains 

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A prospective tenant of a Melbourne house recently offered management agent Melanie Dennis $50 a week more than the $400/week rent being asked at the property to try to secure the tenancy.
Dennis, the managing director of real-estate agency Domain Property Advocates, says offers of this kind are not unusual in the cutthroat under-$600/week rental market. With vacancy rates hovering around 1% across Australia and rents expected to rise by about 7% this year in capital cities, some renters are desperate to get a toehold in.
But despite a market that favours landlords, Dennis says she does not recommend a property owner necessarily accept the highest rental bidder. She says she always checks references carefully to ensure quality tenants. Additionally, bidding above the advertised rent levels could be illegal in some states.
Property Observer offers eight strategies to make the most of increasing rents – without losing highly prized, reliable tenants.
1. Give tenants notice of rent increases far in advance
Landlords in Victoria and NSW are required by law to give tenants 60 days’ notice before a rent increase. Landlords are also not allowed to increase rents during a lease.
Gary Triganza, senior property manager for inner-city Sydney agency Kelly &amp; Sons, says it could be beneficial to a landlord to give 60 days’ notice of a rent hike well before a lease expires.
Dennis suggests that landlords begin to think about increasing the rent three months before the lease expires in order to give them time to check market rents and get advice from agents on current market values. This all takes time.
“You will want any rent increase to lock in from the first day that the lease expires,” Dennis says.
2. Sometimes keeping good tenants is more important than getting the highest possible rent
Triganza says landlords should think about keeping rent slightly below market rate in order to keep a really good tenant. “Landlords can then go to the full market rent with the next tenant,” he says.
This strategy could actually save landlords money in the long term. “If a tenant looks after a property, it might need painting, say, every nine or 10 years instead of every, say, five years,” Triganza says.
Dennis says charging a tenant, say, $10 a week less than the market rate amounts to a valuable saving of $520 for the tenant, which might keep him or her in your property for longer. This in turn saves the landlord money, as rental income is not lost while searching for another tenant and the property is not being damaged with furniture being moved in and out.
3. Don’t charge rents above what the market will allow
Rents that are too high will scare off prospective tenants, leaving the landlord with no source of income, Triganza warns.
Dennis adds: “Every week that a property with a market rent of $350 a week, for example, sits vacant, the landlord is losing $350 a week.”
She also warns that tenants who are willing to pay above-market rates may be offering more because they have a poor tenancy history.
4. Make sure the agent checks all references
“Don’t take it for granted that your agent has checked the references of people who want to rent your property,” warns Dennis.
“I check a minimum of five references for each property. I won’t put a bad tenant into a property; I have to manage it.”
5. Insist on a rent-rise clause in leases longer than a year
Dennis says rent-rise clauses are especially crucial in markets when rents are increasing rapidly.
Triganza says in such tight rental markets landlords should consider offering six-month leases. Shorter leases enable landlords to raise rents more quickly. However, he says some landlords prefer the security of a long-term lease to the potential extra income from being able to raise rents frequently.
6. Let go of bad tenants
Due to the shortage of rental units and competitive rental market, Dennis says you do not have to put up with a tenant who is late paying rent, fails to keep the property clean or causes damage.
She suggests landlords tell tenants about any problems with their conduct, and if necessary, give them notice to vacate, even if the lease is not yet up.
However, she recommends that landlords try to maintain good relations with tenants by ensuring properties are in good condition. Tenants are more likely to look after properties that are well-maintained.
A well-maintained property is also more lucrative than a neglected one, as it can bring in hither rent. “Keep the property up to scratch, but I am not suggesting major renovations such as extensions,” Dennis says.
7. Review rents regularly
Fitzpatricks Real Estate property manager Lynette Kimball, who works in the regional NSW city of Wagga Wagga, suggests landlords review rent levels ever six months and try to keep rents at market rates.
8. Be aware of the effect of below-market rent on capital values
Kimball, who is chairwoman of the property management chapter of the Real Estate Institute of NSW, says keeping rents significantly below market rates for four or five years can backfire, because although it may ensure good tenants stay in the property, it can damage the resale value.
Kimball says she has seen instances when properties did not sell for expected prices because landlords were not able to show a history of satisfactory rents. “Consider not just today but the capital growth in the future,” she advises.
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How to keep good tenants

Queensland builder-developer MAYD has revealed the first look at its major North Kirra beachfront development, lodging amended plans that reduce the number of apartments and increase the proportion of larger residences.

The project is planned across a substantial 4,742 sqm amalgamated site spanning seven lots at <a href="https://www.apartments.com.au/new-apartments/2-6-pacific-parade-bilinga-qld-4225">2-6 Pacific Parade</a> and 27-33 Golden Four Drive in Bilin​ga, directly opposite Nor​th Kirra Beach.

<a href="https://www.apartments.com.au/developers/mayd-group">MAYD</a> secured the site for $32.5 million in 2025, in what was one of the Gold Coast's largest property transactions of the year.

The development will be delivered across two stages, with the first stage carrying an estimated gross realisation value of around $360 million.

The latest amendments seek to reduce the overall apartment count and shift the project further toward the owner-occupier market, with larger residences designed for buyers wanting considerably more space than traditionally offered in a beachfront apartment.

The residential mix will include townhomes, oversized two-bedroom apartments, substantial three-bedroom residences and four-bedroom homes.

MAYD has appointed Cera Stribley to lead the architecture and interiors, with the Melbourne-based design practice drawing on the beachfront setting through a series of ocean-facing terraces and heavily landscaped balconies.

Strong horizontal forms and curved balconies will define the exterior, with subtropical landscaping integrated throughout the building to soften the built form and increase the connection between the residences and the beachfront.

The project will also include an extensive collection of resident wellness and lifestyle facilities, continuing the broader shift across the Gold Coast's luxury apartment market toward larger homes supported by resort-style amenity.

<img alt="MAYD" data-entity-type="file" data-entity-uuid="d1bcbb05-e659-4b47-8bd4-1e595315e2ad" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-27%20at%202.05.03%E2%80%AFPM.png?VersionId=jj0XEud1X1DuLt7_KyElhjMdZGOXmLHP" />

MAYD Founder Todd Mould said North Kirra was increasingly appealing to buyers attracted to the more established, lower-density character of the southern Gold Coast.

"North Kirra presents one of the most compelling luxury residential opportunities currently emerging in Australia, combining absolute beachfront with the character and authenticity that buyers are increasingly seeking, and the same sense of tight-knit community that defined Burleigh and Currumbin perhaps 10 or 15 years ago," Mould said.

"With Gold Coast Airport on its doorstep, it also offers a level of accessibility that broadens its appeal across almost every market demographic."

The project comes as the southern Gold Coast continues to attract an increasing share of high-end apartment development and buyer activity.

Kirra in particular has emerged as one of the region's more tightly held beachfront markets, with its relatively low-density character, established surf and hospitality scene and proximity to Gold Coast Airport differentiating it from the higher-density markets further north.

Mould said those characteristics had informed the approach MAYD and Cera Stribley had taken to the project.

"We've worked closely with Cera Stribley to create a vision that is deeply connected to its surroundings," he said.

"Inspired by the coastline itself, the architecture has been shaped around space, privacy and resort-style living, creating a collection of homes that reflects the next generation of luxury on the southern Gold Coast."

MOTIV Managing Director Carly Cottam, who has been appointed to market the project, said buyer attention had continued to move south along the Gold Coast.

"Purchasers who may once have defaulted to Broadbeach, Main Beach or Surfers Paradise are increasingly recognising the value of a genuine beachfront location that offers lower density, strong amenity and a more established sense of community," Cottam said.

"Kirra has a powerful combination of growing demand and genuine scarcity. Beachfront supply is inherently constrained, the area remains relatively low density, and buyers are increasingly placing a premium on locations that feel established, uncrowded and authentic rather than heavily developed."

Cottam said the proximity to Gold Coast Airport was also proving increasingly important for interstate and second-home buyers.

"Being minutes from Gold Coast Airport makes it particularly compelling for interstate buyers, frequent travellers and second-home purchasers who can access an authentic coastal lifestyle almost immediately after stepping off a flight."

The acquisition takes MAYD's active development portfolio to more than $500 million, with the North Kirra project representing one of its largest undertakings to date.

MAYD is targeting an early 2027 launch.

Joel Robinson

First look at MAYD's North Kirra mixed-use precinct

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Castle Hill, the longtime hub of the Hills District, has been one of the major beneficiaries of Sydney's Metro expansion, with improved connectivity helping drive continued population growth, development and buyer demand across the Hills District.

But despite that growth, the suburb has seen relatively few major new apartment projects brought to market over the past 18 months.

Hills District developer Reve Group is looking to fill that gap with <a href="https://www.apartments.com.au/new-apartments/nova-r-ve-castle-hill-2-garthowen-crescent-castle-hill-nsw-2154">Nova Rêve</a>, a major new mixed-use precinct on the corner of Garthowen Crescent and Old Castle Hill Road, a short walk from Castle Hill Metro Station and Castle Towers.

[smartcode_project:default project_id=152737 project_image_fid=377679]

The project will comprise three residential towers alongside a hotel, restaurants, cafes and a skybar, more than 1,600 sqm of ground-floor retail and almost an acre of landscaped gardens.

It represents the largest project undertaken by Reve Group, the development arm of the Kassis family, which has been building across the Hills District for more than 30 years through Kassis Homes.

[smartcode_project:default project_id=152737 project_image_fid=377675]

Nova Rêve also represents a significant step up from the family's first apartment development, Grand Rêve, which was delivered nearby on Garthowen Crescent.

Grand Rêve introduced larger, house-like apartment layouts and premium inclusions including Wolf and Sub-Zero appliances to the Castle Hill market.

Nova Rêve takes that approach to a precinct scale, combining the residential component with hospitality, retail and substantial public and resident landscaping.

[smartcode_project:default project_id=152737 project_image_fid=377685]

Reve Group Managing Director Sam Kassis said the project reflected the family's three decades of building in the Hills, which has evolved from trophy homes on quarter-acre blocks to larger-scale apartment development.

"Grand Rêve was our first apartment project here and it showed us what this pocket of Castle Hill could be. Nova Rêve is the refinement of that idea: not just apartments, but a place the whole suburb can use," Kassis said.

A key part of that approach is the hotel, which has been designed to operate as an amenity for the wider Castle Hill community rather than solely hotel guests.

It will include restaurants, cafes, skybars and all-day dining, alongside conference and event facilities catering to business functions, community groups and private events.

At ground level, more than 1,600 sqm of shops and cafes will open onto the surrounding streets and landscaped areas.

Almost an acre of gardens designed by Land and Form Studios will run through the precinct, incorporating pathways, seating, barbecue areas and children's play spaces.

[smartcode_project:default project_id=152737 project_image_fid=377680]

Reve Group's Romio Georges said creating an active ground plane had been central to the planning of Nova Rêve.

"There are gardens with pathways, barbecues, seating and play areas, shops and cafes opening onto the street, and a hotel with restaurants and a skybar that anyone in Castle Hill can walk into," Georges said.

The project's elevated position on one of Sydney's highest ridgelines will also provide apartments with outlooks toward the Sydney skyline, surrounding parkland and the Blue Mountains.

More than 80 per cent of the apartments will occupy corner positions, with Turner responsible for both the architecture and interiors.

&nbsp;

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Nova Rêve arrives as Reve Group bets on Castle Hill's next growth phase

A collection of just 25 large-format apartments and penthouses overlooking Goodwin Park is entering the Coolangatta market, with <a href="https://www.apartments.com.au/new-apartments/marea-residences-coolangatta-27-27a-dixon-street-coolangatta-qld-4225">Maréa Residences</a> combining a low-density, residential-only approach with uninterrupted park and Pacific Ocean outlooks.

Located at 27 Dixon Street, Maréa comprises three and four-bedroom residences alongside a limited number of dual-level penthouses, with the project positioned between Goodwin Park and <a href="https://www.apartments.com.au/developments/coolangatta-qld-4225">Coolangatta</a>’s coastal precinct.

Construction has commenced, with completion currently estimated for late 2027. Three-bedroom residences are priced from $1.8 million.

[smartcode_project:default project_id=150999 project_image_fid=374005]

The project has been designed around its northern outlook across the park, with the building’s architecture, landscaping and material palette intended to establish a connection with the neighbouring green space. The residences have been configured to maximise natural light and views across Goodwin Park towards the ocean.

Inside, the material palette incorporates timber, stone and brushed brass, complemented by curved detailing and ambient lighting. Kitchens and bathrooms carry the same natural material approach, while residences also include basement parking, storage and lift access.

Maréa’s penthouses are arranged over two levels and include private pools, adding another layer to the project’s focus on larger-format apartment living. Across the development, residences are configured with three or four bedrooms rather than the broader mix of smaller apartment types commonly found in larger projects.

[smartcode_project:default project_id=150999 project_image_fid=374010]

Resident amenity is concentrated at rooftop level, where landscaped entertaining terraces and pools take advantage of elevated views across Coolangatta and the Pacific Ocean.

The project has so far been particularly well received by local owner-occupiers and downsizers, according to Urban Activation Property Sales and Marketing Director Matt George, with the residential-only format, construction quality and northern park outlook among the features resonating with purchasers.

“The uninterrupted northern aspect overlooking Goodwin Park has been a key point of difference, with buyers attracted to the sense of serenity and open space the park provides, while still enjoying easy access to the ocean and being within walking distance of the lifestyle and amenities Coolangatta has to offer,” George said.

[smartcode_project:default project_id=150999 project_image_fid=374002]

“The combination of high-quality construction, a residential-only building, park outlook and proximity to the beach has resonated strongly with the local downsizer market.”

The Dixon Street address is within walking distance of Coolangatta Beach and the broader southern Gold Coast coastline, including the surf breaks at Snapper Rocks and Kirra. Coolangatta’s cafés, restaurants and retail are nearby, while Gold Coast Airport is also within close proximity.

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Maréa Residences brings parkside apartments to Coolangatta

Melbourne developer PDG has secured Victorian Government approval for its $1.5 billion Southbank development <a href="https://www.apartments.com.au/new-apartments/the-one-1-queens-bridge-street-southbank-vic-3006">The One</a>, clearing the way for the long-dormant riverfront site opposite Crown to finally be developed.

The Minister for Planning has approved the project at 1-29 Queens Bridge Street, with the Department of Transport and Planning issuing the planning permit following its assessment.

The approval will allow PDG to develop the prominent 5,059 sqm site with a major mixed-use tower comprising premium apartments, including branded residences, a luxury hotel and boutique office space.

PDG acquired the site in late 2024, with its position directly opposite Crown's main entrance and near Melbourne's Arts Precinct making it one of Southbank's most significant remaining development opportunities.

<img alt="PDG" data-entity-type="file" data-entity-uuid="3933013e-6332-4386-b9be-089df05caf17" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-27%20at%209.29.22%E2%80%AFAM.png?VersionId=sITIgBqDL0N3VNSMwWEmF5UA.uvcsRyu" />

Designed by COX in collaboration with ODO and PDG, the tower's architecture draws on the movement of the Yarra River, with six vertical pleats running the height of the sculpted facade.

The project will also see the heritage-listed Queens Bridge Hotel restored and incorporated into the development&nbsp;with new hospitality and public uses, including a rooftop venue.

A significant component of The One will be its residential amenity.

More than 5,000 sqm of resident facilities will be delivered across a single level, making it one of the largest consolidated residential amenity offerings proposed in an Australian apartment development.

The planning approval also incorporates a major upgrade of Queensbridge Square, which PDG will deliver in partnership with the City of Melbourne.

<img alt="PDG" data-entity-type="file" data-entity-uuid="73167fcd-1031-4b6f-a408-a064cfe45ed1" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-27%20at%209.29.17%E2%80%AFAM.png?VersionId=Pf1AEWxw6SNmBqR0zQW5lyEze.MtxgFp" />

The existing square will be revitalised as a new civic and pedestrian space along the Yarra River, strengthening the connection between the project, Southbank and the riverfront.

PDG Founder and Managing Director Vince Giuliano said the approval represented a major milestone for a site which has remained largely underutilised for more than 15 years.

“This is the most significant Planning Permit approval Melbourne has seen in recent years,” Giuliano said.

“For more than 15 years, this site has remained underutilised. This approval enables us to deliver a project that will contribute meaningfully to the revitalisation of Southbank, restore and reactivate an important heritage building, and create a new civic and hospitality destination for Melbourne.”

The latest approval follows an earlier planning permit issued by the City of Melbourne covering demolition works across part of the site at 9-29 Queens Bridge Street. Those demolition and early works are already underway.

PDG has also started generating early interest in the residential component from owner-occupiers ahead of a planned public launch in early 2027.

PDG secures approval for $1.5bn Southbank apartment development, The One

Local developer Harridan is seeking to turn its Woolloongabba apartment project into the first stage of a broader transformation of Burke Street, using a new 16-storey mixed-use building to establish a greener pedestrian connection toward the rapidly evolving Boggo Road transport and knowledge precinct.

The South East Queensland developer has filed plans for 154 apartments on the <a href="https://www.apartments.com.au/new-apartments/4-burke-street-woolloongabba-qld-4102">southern side of Burke Street</a>, where its proposal has been designed alongside a wider vision by LatStudios for the street.

That vision positions the southern side of Burke Street for buildings of 15 storeys and above, while envisaging lower-rise development of up to five storeys on the northern side to transition into Woolloongabba's existing character housing. It also proposes wider pedestrian verges, deep planting, new street trees and upgrades to the pedestrian approach to Boggo Road Station.

The Harridan development itself has been designed by Brisbane-based Arqus Design and will comprise 154 apartments across 16 storeys. The mix is weighted heavily toward two-bedroom apartments, with 121 proposed alongside 10 one-bedroom and 23 three-bedroom residences. There will typically be around 14 units per floor.

A lower-ground car park and three podium levels will accommodate 156 resident parking spaces, along with visitor and commercial parking. There will also be 154 resident bicycle spaces and 40 visitor bicycle parks.

&nbsp;

Harridan is a family-owned developer and part of the Holmwood Highgate Group, with more than three decades of development activity across South East Queensland. Its portfolio spans residential, commercial and industrial property, with current residential projects including Riverbank on Byron in Bulimba, Esperance Residences in Carina and The Precinct at Kinross Road in Thornlands.

Wooloongabba has been popular for apartment developers, particularly since the announcement of the 2032 Summer Olympics games in Brisbane.

While there have been a lot of development applications, it has failed to materialize into real supply.&nbsp;

Sarazin has been the major player in the area. They are under construction at Murcia Residences, on the fringe of East Brisbane and Woolloongabba. They have just launched <a href="https://www.apartments.com.au/new-apartments/the-stanley-residences-woolloongabba-8-trafalgar-street-woolloongabba-qld-4102">The Stanley Residences</a>, in Woolloongabba on Trafalagar Street. They also have Nuage coming soon on the nearby <a href="https://www.apartments.com.au/new-apartments/nuage-woolloongabba-14-wellington-road-woolloongabba-qld-4102">Wellington Road</a>.

Michael Laurence

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