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Children, grab your notebooks and gather around, I am going to tell you a story.
There were once two identical buildings – building A and building B.  They sat side by side and remember they were exactly the same.
They each had 50 nice little apartments in them.
Both building A and B started selling at the same time.  The apartments in both buildings sold for exactly the same price and attracted the same exact rent once completed.  They were both promoted as being affordable and were aimed at key workers.
Now children, a key worker is a local resident such as a nurse, school teacher, bus driver, police officer or firefighter, for example, and reflecting today’s society, baristas are included also.
Nearly all of the apartments in both buildings sold to investors.  Both projects each employed 200 people during their construction.
But this is where their similarities stopped.
And the moral to this story, like all good tales, comes at its end.  So best we listen carefully.
Building A was sold locally.  The developer built an expensive display suite and advertised in the traditional way via print advertising.  He staffed the display with a receptionist and several salespeople who all drew a wage and got paid the standard industry commission.  Only government rebates applied, such as the first-home buyers’ boost.
Building A took three and half years to sell, with the first tenants moving in a full five years after the first sale was made.
All of the apartments settled without much of a hiccup, with most of the buyers’ bank settlement valuations coming in within 5% of the purchase price.  And for the older (read smarter) children in the class, there was very little resale price or rental growth across the market between the first sale and settlement.
The developer, given the project took so long to sell, ended up spending close to 20% of his gross realisation (kids, ask one of your parents when you get home what GR is) on promotion and commissions.  He made very little profit – and the stress from such an arduous haul almost killed him – and he vowed never to do another property development again.
Building B was a completely different kettle of fish.  It sold out in under six months and was ready for tenants to move in within 18 months of the first sale.  The developer spent less than 10% of GR on promotion, sales commissions and rebates.
The 200 people employed during its construction all got paid and are now off working on another building job, making good money and helping house even more key workers.
But this developer, too, will not be doing another project any time soon.  Why?  Because only 35 out of the 50 little apartments have actually settled.  So the developer has made no profit and might have to sell her house to make ends meet. 
Now, in order to sell these apartments quickly, the developer offered a higher sales commission, targeted interstate and overseas buyers (as there are lots more of them than local buyers) and also offered to pay buyers’ stamp duties if they bought before construction started.
You see, children, these buildings were located in a backward state where electioneering, not sense, prevails.  In this dark place, full stamp duties are charged on presales and even things like 27c¹ still exist.
In order to make her marketing budget stretch, the developer of building B didn’t build a display suite, nor directly employ anyone, she was smart and promoted her project digitally and used the expertise of others to help make sales.
For building B it was a fight from the get-go with regards to buyer settlement valuations.  The same valuers were employed as in the case of building A.  They even used the same “comparable” resales to bench market value.
But because a higher commission rate was paid, sales weren’t made to yokels (oops, I meant to say locals) and rebates were offered, the apartments in building B were apparently worth much less, despite them attracting the same rent.
As a result, the buyers in building B had to find more money in order to settle.  Most did, some begrudgingly (and who could blame them), while several just couldn’t afford to do so.  Hence, 15 apartments have yet to settle.
So children, what is the moral to this story?
No, Jane – buying in Building A isn’t the answer I am looking for.  And no, Jimmy – we cannot get rid of valuers.
In fact children, there are two main messages here:
Firstly, an investment dwelling’s worth should be determined by income – that means rent – just like it does for offices, shops and factories.  It shouldn’t be determined by a “comparable” resale.
Secondly, how and where the developer spends his or her money on a project shouldn’t affect the market’s (nor valuers’) perception of value.
Now everyone get out your notebooks and write down these two things:
An investment’s value shouldn’t be determined by what a buyer once paid but by its income.
The distribution of costs has no bearing on the end value of a product.
¹ According to clause 27c, all agents in Queensland are required to list how much they charge for commissions.  Valuers on instructions from the mortgage insurers and banks are deducting the amount the agent is paid in excess of the standard Queensland sale fee of 2.5%.  The 27c is a product of the Gold Coast fly-in and fly-out marketing of 25-plus years ago.  It only applies to Queensland.
Michael Matusik is the director of independent property advisory Matusik Property Insights. Matusik has helped over 500 new residential developments come to fruition and writes the weekly  <a title="Matusik's Missive" target="_blank" href="https://matusikmissive.wordpress.com/">Matusik's Missive</a>.
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A tale of two Queensland buildings: An investment property's worth should be determined by income

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Several readers made contact with us after <a target="_blank" href="https://www.propertyobserver.com.au/residential/reducing-stamp-duty-not-boosting-building-the-key-to-solving-housing-crisis-michael-matusik/2011110852260?source=flicker3">yesterday’s story</a>, asking if we knew about the actual distribution of the Building Boost applications across the state.
We have had a hell of a time getting such information out of the government, with more than the usual amount of stonewalling.  Queensland Labor is next releasing information about the Building Boost in late November.
Methinks – and assuming a successful 2018 Gold Coast Commonwealth Games bid (which, by the way, will be announced at 8am this Saturday) – that we might be going to the state polls much sooner than we think.  Several glossy new documents – well, revamped ones, really – have been released in recent weeks, including Queensland government’s 20-year Infrastructure Plan (again!).  But more on this later.
My money is on Anna Bligh calling an election this weekend.  If so, we will be voting this side of Christmas.
The table below outlines the distribution of the Queensland Building Boost applications as at October 7 – the latest figures available.  Remember, as at October 26 (again, the latest total stats available) 1,113 state-wide applications had been made, of which 379 have been approved.  Now, again, maybe buyers are waiting in the wings and we will see an enormous rush towards January.  I do hope so.  But the stats to date don’t hold that much promise.
<img src="/images/stories/matusiknov10.gif">
Now, let’s draw some attention to the latest version of the state’s 20-year Infrastructure Plan.  It would really help matters (or at least humour us) if the Queensland State Government would at least acknowledge the property industry’s existence.  According to the 20-year Infrastructure Plan, the four key industries behind Queensland’s economic growth are:
<ul>
<li>agriculture</li>
<li>tourism</li>
<li>manufacturing</li>
<li>mining</li>
</ul>
No mention of the property or construction industries.  None at all.  How ironic that this ignorance is highlighted in a document that largely requires the construction industry to implement it.  So, in the lead up to a state election – whenever it is – here are some pertinent facts.
<ol>
<li>The property industry is the largest private sector contributor to the Queensland economy</li>
<li>It generates $31 billion of Queensland’s GSP – 13% or one and half times mining’s 8.4%</li>
<li>It employs directly 280,000 – the state’s largest direct employer</li>
<li>With indirect jobs – 585,000 or 30% total employment in Queensland</li>
<li>It is the single largest contributor to state taxes – $3.8 billion or one-third of total state tax revenue</li>
<li>In addition, local governments across Queensland collect over $4 billion in rates and charges each year</li>
</ol>
Sorry if I sound short-changed right now and, frankly, more than a little pissed off!
Michael Matusik is the director of independent property advisory Matusik Property Insights. Matusik has helped over 500 new residential developments come to fruition and writes the weekly  <a href="https://matusikmissive.wordpress.com/" target="_blank" title="Matusik's Missive">Matusik's Missive</a>.
 
 
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The number of Queensland building boost applications broken down by region

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For those who think that building grants or first-home buyer boosts are the answer to our undersupply of housing, you had best think again.  We are already halfway through the six-month Queensland “building blitz”, in which Queensland Labor was going to help facilitate up to 14,000 new housing starts across the state with its $10,000 Building Boost.
As at October 26, only 1,113 building boost applications have been received by the Queensland government and just 379  (yes 379) boosts have been approved – $3.8 million worth of support, costing an estimated $660,000 to advertise and promote the campaign.
Now, to be fair, the take-up is on the rise, but whether or not it is a hockey-stick style graph is debatable.   To quote Queensland Treasurer Andrew Fraser from Hansard on the 27th of last month – “I can advise the House that as of yesterday the number of applications is now 1,113.  In fact, the number approved is 379, but I want to make this point: as at 30 September, just a few weeks ago, it was 569.  In the week after that it jumped to 698.  In the week after that it jumped to 843 and in the week after that it jumped to 992.  So we do see the hockey stick approach to the graph at the moment.”
Yet, despite such reassurances, the 1,000-odd boost applications represent just a 4% increase on last year’s building approval across the state – which was just 27,500 starts – a 10-year low.  The real result – being 379 approvals – is a measly 1.3% lift in new dwelling activity.
Now maybe there are many more buyers waiting in the wings.  I hope so, but maybe, as we suggested, a 2% reduction in the asking price of a new property just doesn’t cut it.
The increase – as outlined by Fraser above – appears to be steady at around 150 new applications by per week.  So by the end of January – and assuming interest doesn’t sag during the Christmas holidays (a big ask!) – a total 3,000 applications would have been received.  Not a great result, given the 14,000 target, if you ask me.
Now we have some in the development industry calling for the boost to be extended.   Well, I will let Albert Einstein reply on my behalf.  “The definition of stupidity is doing the same thing over and over again and expecting different results.”
Assuming that the $140 million set aside by the Queensland government for this six-month blitz isn’t used up (which is extremely unlikely), and also assuming that Queensland Labor really wants to help the new housing industry, how best should they spend this “windfall”?
The answer is simple – remove stamp duty from off-the-plan transactions.  The impact – as shown in both Victoria and more recently New South Wales – should be immediate and very positive.
We have just completed work on this for the Property Council of Australia; and while we are embargoed from releasing the key findings for the time being, we can say that removing stamp duty from off-the-plan sales is likely to increase new housing starts across the state by between 10% and 15% per annum.  Yes, every year!
There is also local evidence that paying a buyer’s stamp duty works much better than the boost.  Some of the larger developers – who are supportive of the $10,000 handout – have been making sales because they have used this government largesse as cover as they offer – often quietly – to pay a buyer’s stamp duty.
Queensland needs a competitive advantage.  Our main competition is New South Wales and Victoria.  Dropping stamp duty for off-the-plan purchasers gets us back to a more level playing field.
It is a step in the right direction.
Michael Matusik is the director of independent property advisory Matusik Property Insights. Matusik has helped over 500 new residential developments come to fruition and writes the weekly  <a href="https://matusikmissive.wordpress.com/" target="_blank" title="Matusik's Missive">Matusik's Missive</a>.
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Reducing stamp duty, not boosting building, the key to solving housing crisis: Michael Matusik

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There is little doubt that a fall in interest rates would have a positive impact on new housing starts.  But despite calls from the development industry for rates to drop today, there really isn’t any real need to build more new dwellings at present.
While our market was undersupplied in 2009 – we only built enough new homes for 330,000 people but needed to build for 465,000 people – we have been oversupplying the market since then.  Last financial year, we built enough homes for 400,000 people but really only needed to house 310,000.
We consistently overbuilt during the first half of the noughties.  Many of these new dwellings were secondary homes – used for holidays and the like – or were built as speculative investments, where the promise of capital growth outweighed the need for a rental return.
The recent drop in population growth has caused the underlying demand for housing to drop by a third across Australia since 2009.  Queensland and Victoria have experienced even greater falls.
As a result, we now have considerable spare capacity in our housing market.  This explains why new dwelling sales continue to slide across the country.
In addition, we no longer need to build as many new homes as we once did.  Social and demographic changes – children living at home longer; increasing longevity (coupled with diminishing superannuation balances); an increase in the birth rate (baby bonus impact) and more migrants from countries with traditionally large families – have lifted our household size, resulting in fewer new dwellings per capita.
This financial year will be a slow year for new housing starts. Just 135,000 new dwellings are expected to be built over the next 12 months.  This is 15% fewer than last year.  This level of new supply would comfortably cater for the expected increase of around 325,000 in the Australian population next year.  This forecast also assumes stable interest rates for the next six to 12 months.
Forward estimates are for, on average, between 150,000 and 160,000 new housing starts each year over much of the next decade.
While a drop in interest rates would temporarily boost new housing starts, the only real reason why housing starts would need to rise across Australia would be to cater for higher levels of population growth.
When looking at the wider picture, the Australian economy is not suffering from a lack of demand.  Whilst we do have a three-speed economy, the overriding problem – apart from declining productivity (which is a serious issue and a topic for a separate missive) – is that we are still recovering from the enormous hit in the first quarter from the floods in Queensland, NSW, Victoria and Tasmania and Cyclone Yasi.
These combined to hit confidence levels, and cut production of coal, iron ore, copper and other minerals as well as many rural products.  This pushed the economy into the red in the March quarter, but as the national accounts showed, consumption grew by around 3% in the year to June.  Current projections are for a 3.4% increase this financial year.  According to the ABS we are close to full employment.  This is not a recession.
Nor is inflation tamed.  Far from it.  The third-quarter inflation figure is at odds with the longer-term trend and might actually be wrong.  This combined with our low labour productivity, union pressure on wages, rising global inflation driven by both developing countries and the West’s politically driven agenda of low interest rates and printing money plus the large resource spending about to start across the country means that we are facing higher inflation in the years to come.
Rates should have fallen earlier this year, immediately after the floods and cyclone.  But now the best course of action, I think, is to keep them steady and to do so for as long as we can.  A cut in our official interest rate later today could spook the horses.  Often a scared horse bolts, but sometimes they hide deeper in the corral.  We just might conserve ourselves into a recession.
It is quintessentially Australian, to be on a day off – as that is exactly what Melbourne Cup Day is – and still expect interest rates to fall.
Be careful what you wish for.  It just might come true.
Michael Matusik is the director of independent property advisory Matusik Property Insights. Matusik has helped over 500 new residential developments come to fruition and writes the weekly  <a title="Matusik's Missive" target="_blank" href="https://matusikmissive.wordpress.com/">Matusik's Missive</a>.
 
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Be careful what you wish for on interest rates: Michael Matusik

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There are three things that drive me – I like to be a lonely voice; I enjoy being a stick in the mud (and grumpy about it); and I am always more interested in what people do than what they say.

This somewhat self-centred introduction is an attempt to explain why I keep banging on about the need to change our urban planning policies in this country.  We need to accept the fact that most don’t want to live in little air-conditioned boxes in the sky.  I am not against high-density development – God knows my business has helped many of them come to fruition; it is just that the argument for anything else is losing its voice.

So, here I am again, shouting out for the detached, the semi-attached and townhouses.

A few years back, the United Nations announced, with much fanfare, an invisible yet momentous milestone – for the first time in history more than half of the world’s human population was now living in urban areas.

This trend helped spark the “triumph of the urban”, and the extolling of the virtues of high-density city living over almost all other dwelling forms.  But such supposed triumph is fraught with ironies, the biggest of which is that rather than a simple rush of people from the hinterland into the high-density city centre – and within almost every urban area (Australia included) in the world – the most significant movement of the population has been outward, from dense city centres into peripheral suburban areas, and beyond them into small, dispersed settlements.

The official geographic boundaries, such as those used by the ABS, cloud these trends, and hence they don’t get the analysis and airplay they deserve.

Our analysis, which we do every second or third year (as it is a very time-consuming exercise), shows that more than half of the new urban development across Australia takes place on the fringe.  This is up from 45% 10 years ago.  Inner city expansion is steady at around 15%, with redevelopment of our middle-ring suburbs falling behind.

Most Australians want to live in a dwelling with a close nexus to the ground.  It is who we are – and most migrating to our shores want the same.  The increase in household size suggests the demand for larger homes will increase and high land costs will force more development outwards.

The urban triumphant like to advocate that detached housing is bad for the environment and the denser living arrangements have less environmental impact.  Yet independent research suggest otherwise.

Our planning schemes are also failing us and in some cases, badly.  Despite grand plans to have most of us live in very dense urban settings, the SEQ regional plan can, at best, only deliver two-thirds of the housing starts it needs on “infill” sites.  Many municipalities across the south-east are struggling to hit the halfway mark.

Recent headlines announced that the balcony was replacing the backyard as the new Australian dream – poppycock.  When you remove Melbourne’s speculative boom in student-sized inner city apartments from the mix, there has been no real change in the proportion of attached dwellings built across the country in close to 20 years.

The vast majority simply cannot afford to live downtown.

It is time to accept the facts – and observe what people actually do and not what the “latte left” and political élites say the public want – and start really planning the redevelopment of our middle-ring suburbs and the continuation (even acceleration) of development on the city-fringe and beyond.

We might need to offer some serious incentives to help kick-start things across our middle suburbs.  This, importantly, involves giving back credence to zonings – redevelopment should not be allowed to be stopped by local action groups if the land is already designated to hold higher density development.

Ironically, the continuing spread of the population could conceivably result in a more equitable and more sustainable pattern of living.  This would definitely be the case if Australian management would join the rest of the world and treat white-collar workers like adults, allowing them to work wherever they wish, as long as they meet their KPIs.  In addition, smaller-scaled energy systems – renewable or not – surely would consume less than the giant grids needed to maintain massive urban landscapes.

In any case, despite all the planning regulations put in place in cities throughout the western world to control (stop) growth at the edge, the periphery continues, inexorably, to expand.

Get over it.  We have far more important battles to fight.

Michael Matusik is the director of independent property advisory Matusik Property Insights. Matusik has helped over 500 new residential developments come to fruition and writes the weekly  <a title="Matusik's Missive" target="_blank" href="https://matusikmissive.wordpress.com/">Matusik's Missive</a>.
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Australians want to move out, not up

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All economic activity is fuelled (and limited) by the availability of three things: land, labour and capital.  The term “demand” can be interchanged with “labour” in some instances.  Without all three components, economic activity does not grow – well, not as fast as it could.
When it comes to new housing in Australia, the availability of land is largely restricted by politics and poor policy and not the actual absence of land.  Hence, serviced land is what is expensive and not the actual dwelling itself.  A recent housing study by the RBA shows that land costs far more where development restrictions are tightest.
Over the last 10 years or so, the cost of vacant serviced suburban land has escalated by over 230%, and the price of urban redevelopment sites has increased even faster.
More new houses would be built across the country if the current jihad on detached homes were dropped; we simplified our planning schemes; stopped all the nonsense compliance and shut down troublesome state government departments.  The Queensland Department of Environment and Resource Management (known in the industry as DNO or the Department of NO), for example, springs to mind.  We want our bureaucracy “on tap”, not “on top”.
Such action would improve the supply of land, thereby reducing its cost and making new homes more affordable.  The demand for new homes would subsequently rise.
Too simple?  Well, in fact no.  This is exactly what needs to happen on the supply-side of the equation.  The trouble is this takes political will – and even if such will were to emerge (the sooner Queensland goes to the polls the better), it will take time to implement.  And many of us just cannot continue to hang on for that long.
It is also painfully obvious that the new housing industry is being penalised by the lack of adequate finance.  While this situation is unlikely to improve dramatically until global funds free up – something that largely depends on an economic recovery in United States – there are certain things on the finance or capital side that could be done to help boost sales.
One solution would be to include overseas sales in off-the-plan, pre-construction financial prerequisites.   For some reason, bankers think that the only “real” sale is a local one.  But, as is blatantly obvious to local retailers these days, the internet has changed the way we buy (and sell) products, and real estate is no different.  An internet inquiry (with certain caveats) is as good as a walk-in these days.
The finance industry is doing its developer clients a major disservice by not treating overseas off-the-plan sales with the same weight as a local transaction.
Now, I would understand the reluctance to accept an overseas sale if they had a track record of not settling; reselling quickly or for major losses – effectively dumping the stock if their finances got a bit dicey.  But all the evidence is to the contrary.
Overseas buyers, especially given current market conditions, are more likely to settle than Australians, yet the banks continue to discount any overseas buyer for pre-construction finance purposes.  Nowhere does this speak more loudly than on the Gold Coast.  We understand that the settlement rate is 100% for overseas buyers across the likes of The Oracle and Nirvana.  Pity the same cannot be said about local sales.
Our recent study of apartment sales across the Brisbane CBD found that close to one-quarter (23%) of the off-the-plan buyers were from overseas.  Overseas interest now equals sales from interstate (a 26% share of the new Brisbane CBD apartment market).  Overseas buyers now make up a substantial and growing market segment.  To ignore this trend is foolhardy, indeed.
It would also be great if overseas buyers were allowed permanent residency if they bought a new dwelling in Australia.  Certain caveats would apply such as the cost of the dwelling (maybe over $500,000); the length of the initial PR status (suggest five years, owners can reapply in due course) and a limitation (maybe denial) to accessing our welfare system.  Such as change would dramatically increase demand for new property in Australia.
Allowing overseas owners of all property, regardless if it is new or established, to resell their Australian assets overseas and not just to a local (Australian) buyer would also do wonders.
Many across the world view Australia as a safe haven.  We should be capitalising on this.  Yet, when you go to an Asian property expo, watch which exhibits make the most sales. They are nearly always those that offer buyers PR (with caveats) and the right to resell anywhere.  Will someone for the federal government please take note!
We need to fix the new housing industry from the ground up (pun intended) – major changes need to be made to correct the high cost for producing serviced land.  This will take political will and time.   In the meantime, much more can be done to ease up capital and get more new developments off the ground.
Many of us like a fair fight, but we are growing tired of having to fight with both arms and now legs tied behind our backs.
Michael Matusik is the director of independent property advisory Matusik Property Insights. Matusik has helped over 500 new residential developments come to fruition and writes the weekly  <a href="https://matusikmissive.wordpress.com/" target="_blank" title="Matusik's Missive">Matusik's Missive</a>.
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Overseas buyers must be encouraged to help our housing market

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I have had the pleasure of spending three and a half weeks walking through central Italy.  Many have asked me since my return about what is happening over here in relation to the European Union (EU) and the euro.
The European condition (outside of Germany and maybe the Nordic block) can best be summed up in nine words – “the ruins proclaim that the city was once prosperous.”
For mine, we are witnessing the dying gasps of the EU and the euro as we know it.  The world-renowned American economist Milton Friedman said that the EU wouldn’t make it past its first recession – it looks like he was right.  And this is not a trivial event.
In short, European countries are just too diverse to create a long-lasting currency zone.  Languages, cultures and mindsets are very different across its membership.  Most locals I spoke to during our trip identify themselves via their city or region first and foremost, then country but never as a “European”.
While the thrusts behind the creation of the EU are numerous, it isn’t a military alliance (such affairs are linked to NATO) but an economic one.  The idea was that free-trade, regulated by a central bureaucracy, would unite greater Europe, suppressing nationalism and creating prosperity without surrendering what it means to be French or Italian.  The common currency – the euro – is the ultimate expression of this hope.  But in the end, Germans are Germans and Greeks are Greeks.
And “united” does not mean “even”, and Europe’s wealth is not evenly spread.  There is deep-seated resentment between countries and even regions across Europe, which, as history shows, can be suppressed when times are good but resurface when things go custard.  This is especially the case when the controlling identities (Germany and to some degree, France) play by the rules while many others don’t.  For example, it is estimated that 10% of all employment across Italy is “off the books” and in some southern European states the black market accounts for close to half of the country’s trade.
I witnessed such first hand, with the official numbers suggesting recession, but many Italian streets indicating a much stronger real economy.  Most cafes and restaurants ask for payment in cash, while the Italian police wait outside asking customers to see receipts, in some half-baked effort to slow down black-market trade.  It is little wonder that the German and French public don’t want to continue to bail out their neighbours.  As a result, the level of distrust is growing; resentment is on the rise and so too are the local calls for nationalism.
An important sidebar here is that the formation of the EU removed the once-strong legal barriers to migration between European countries. For example, in the last 10 years alone, close to 4 million new migrants have moved into Italy – many from poorer European countries – adding to the growing unrest.
Major action and political leadership is needed and now, but I cannot see the current crop doing anything much about it.
Even if the political elite muscled up, the EU restricts any sensible economic response.  Most economic policy makers would like to achieve three goals – open up their markets to international capital; use monetary policy to help even out their economy; and maintain a stable currency.  Ironically, you cannot achieve all three at once, but you need two working at the same time to prosper.
The US has chosen the first two options; China the second and third.  The troubled EU countries have no monetary choice, cannot influence their currency and also now have very limited fiscal options available to attract foreign capital.  Something has to give. and the public will demand that their governments use all the economic tools available to a sovereign country.
I expect the unrest to increase and spread across Europe.
There will be winners and losers there, with Germany and the emerging Russia and Turkey getting the upper hand, while the “PIIGS” are somewhat doomed, economically.  Europe will, of course, remain a large economy, and it will still consume goods and services; and the best case scenario for the region is little or no real economic growth over the next, say, five years.
The most likely outlook, however, is that the “European” economy will shrink. Major capital/bond listings are likely to be required, which will cause inflation to rise and maybe to hyper levels, resulting in higher global interest rates.
The Bank of England’s decision last week to pump £75 billion ($A 119 billion) of newly created money into the UK economy won’t be the last quantitative easing we will see.  QE typically raises the price of the assets bought, which lowers their yield or economic return.  In short, such action can be very inflationary whilst reducing an investment’s return and underlying value.
England’s latest move clearly illustrates that the political elite will continue to dribble out economic assistance in the hope that prosperity will return, instead of fixing Europe’s economic problems.  On the one hand who could blame them as there is really little to hold the EU together except for the promise of prosperity?  In the meantime, the European public are accumulating grievances, with some remembering how to hate.
I will not go into the history behind the last two world wars and I am not suggesting WWIII, but there are some common elements emerging, and armed conflict in Europe isn’t out of the question.
This bluster aside, we had a fantastic time, visiting close to 20 Tuscan towns and cities and walking about 350 kilometres from Orvieto to the sea.  The food and wine was so good that I, despite the exercise, put on weight!
Oh and by the way, if you want to visit Europe, I would maybe do it sooner rather than later.
Also, whilst the RBA’s present monetary policy stance is mildly restrictive, I don’t expect rates to fall on Melbourne Cup; to do so would suggest that the world’s economy is indeed going pear shaped, and as we argued in a previous missive such action might be counter-productive.  Interest rates here are likely to remain steady for some time.  But they will rise in the future and maybe more than many think.
We have been advising snapshot subscribers that they need to be able to comfortably service a mortgage 1% higher than today’s rates.  Also buyers need to hold a residential asset for at least five years in order to see any worthwhile capital appreciation.  But if Europe’s economy takes a turn for the worse then our suggested 1% buffer needs to be lifted to 2%, maybe 3% and any half-decent asset growth will take much longer.
It might be time to prioritise achieving the return of your capital, not the return on your capital.
Michael Matusik is the director of independent property advisory Matusik Property Insights. Matusik has helped over 500 new residential developments come to fruition and writes the weekly  <a href="https://matusikmissive.wordpress.com/" target="_blank" title="Matusik's Missive">Matusik's Missive</a>.
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The end of the euro is nigh, and it will affect Australia's markets

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As we look to what's ahead for 2012, Property Observer is republishing some of our most noteworthy stories of 2011.
 
Who’d have thought – one little word, five little letters, and so much power – the power of green.  Put the word “green” into a search engine and you’ll get a bucket load of topics in return – green loans, green guides, green rebates, green grants, green energy, green cars…green, green, green.  So what does this all mean?  Is it real, or are we dealing with a whole load of spin that begets greenwashing?
There are many products on the market claiming to be green and some of those can be tested, but when it comes to property, for example, there is no real measure or standard.  This means that anyone can call their house “green”, “eco-friendly”, “sustainable”, or whatever environmental catch-word comes to mind, as we do not yet have a legal definition as to what makes a green house.  There is the six-star energy minimum that many new buildings must adhere to, but does that make a property green?  Add a water tank, a pool cover and a few solar panels – is that green?  The reality seems to be that green more often means money for those purveyors of the colour rather than savings for those who buy into it.
A widely touted study by environmental marketing company TerraChoice has found that 95% of green-marketed products use misleading claims, while only 5% of the 5,300 products examined were free from some form of greenwashing.  The number of green claims is increasing by leaps and bounds, with 73% more green-identified products on the market today than a year ago.
Unfortunately, many home buyers don’t want to pay for the privilege of buying a green dwelling.   This is especially the case for investors.  Many like the idea – either out of some misguided guilt or erroneous desire to do something good for the environment – but they think that the developer or the government should pay for their “green”.  The most optimistic studies show that the average buyer will pay up to $15,000 more for a new green dwelling, which, and here’s the rub, will pay back that premium in terms of reduced energy and water costs within two to three years of purchase.  Impossible.
And to add further salt to the wound, these buyers are prepared to pay about 2% more for a green residence, yet the true cost of all the green goodies is closer between 5% and 8%.  Another nail in the housing affordability coffin.
As Christopher Zinn, of consumer advocacy group Choice, says:  “Wherever you see the words ‘eco’ or ‘green’ or ‘natural’, you need to get out a very accurate ruler.  It could mean anything and nothing.”
For mine, it may be time to bring in some new colours in response to most “greenwash” claims – “blackball” and “redline” come to mind.  Better still, Senator Barnaby Joyce summed it up earlier this year when he quipped: “If you really want to piss someone off right now, mention climate change.”
Michael Matusik is the director of independent property advisory Matusik Property Insights. Matusik has helped over 500 new residential developments come to fruition and writes the weekly  <a title="Matusik's Missive" target="_blank" href="https://matusikmissive.wordpress.com/">Matusik's Missive</a>.
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Green claims making investors see red

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As we look to what's ahead for 2012, Property Observer is republishing some of our most noteworthy stories of 2011.
 
Sadly, both parties, initially led by the Liberal Party and quickly followed by Labor under Julia Gillard, have opted for Little Australia.  For generations, both political parties have done the right thing by Australia on population.  They have strongly supported high immigration despite great reluctance from voters for it.  Big Australia makes sense.

Cutting migration means higher interest rates in the short term and higher taxes in the long-term as our population ages.  As for house prices, well, don’t expect them to grow much, if at all.  House price devaluation is a more likely outcome if we adopt Little Australia.

A smaller population growth means lower productivity.  In order to maintain our standard of living – assuming lower migration – we will have to work longer (and smarter) plus raise taxes.  Working smarter is a noble aim, but it takes a long-term view; real short-term pain; and genuine investment in education and infrastructure.  Think the East’s commitment to such, not the West’s.  I don’t want to sound like a cynic, but I don’t think Aussies are up for this challenge.  Every time I get behind a “Sustainable Australia” or “Australia is Full” sticker on an RV, I just chuckle and mutter “hypocrite”.  My wife and children, I must add, are getting pretty sick of it.

But the economic argument isn’t the only rationale for maintaining high immigration.  There’s a strong moral case too.  Nearly all Australians are the children or descendants of immigrants.  A deep cut in immigration is inter-generational opportunism on our part, in effect denying to future immigrants and their children the advantages that we ourselves have enjoyed.  I also don’t think the world will allow it.

And as for the environmental squabble, well, let me say that if America and Canada can do it, then we can too.  Yes, we have a more sensitive environment than the Americas, but long-term planning plus a regional approach will overcome most issues.  Did you know that only a handful of US cities are bigger than Sydney, Melbourne or Brisbane?  Most of their population lives in regional centres, many of which are under 500,000 people.  We now need to do the same.

On that note, Ken Henry gave the best contribution to the population debate so far, when he said that the first step around regional population imbalances was to address the range of areas where economic growth is being constrained, often at a local level.  Henry correctly nominated water in addition to the more frequently nominated areas of infrastructure.  But it also applies to housing, where approval processes are an important constraint on the market responding to growing demand.  Throwing money at the problem, vis-à-vis Labor’s $225 million quick fix pledge to 15 regional cities, is a Band-Aid solution to much deeper wounds.  Regional Australia needs major surgery, not ointment and a gauze wrapping.

The Little Australia advocates want to preserve Australia in amber, to prevent it from ever-changing.  Why?  Because change is threatening.  We need leadership now, not spin.  Many of us are hungry for it.  My mate Bernard Salt summed it up well in The Australian when he lamented our incredibly sparse population and the low-quality debate to which our leaders are subjecting the nation.

The cowardly retreat from immigration by both major parties is a policy disaster of the first order.  And it’s one for which future generations of Australians will pay.

Michael Matusik is the director of independent property advisory Matusik Property Insights. Matusik has helped over 500 new residential developments come to fruition and writes the weekly  <a href="https://matusikmissive.wordpress.com/" target="_blank" title="Matusik's Missive">Matusik's Missive</a>.
Photograph by Phillip Capper
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Cutting immigration will hurt not just housing, but the entire economy

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Unfortunately, this missive has nothing to do with the state of the residential market.  It remains “dead, buried and cremated”.  This was originally written over a year ago.  The Brisbane market, at least, is in a better position now.
Back in Black, one of the best “comeback” albums of all time is 30 years old.  Thirty years!  There is nothing, apart from seeing your kid’s baby photos, that reminds you more of how old you are than the significant anniversary of a favourite record.
I was in year 11 when this gem came out – a bundle of bluster, testosterone, zits and bad dance moves (some things never change) and can still remember the excitement when first hearing that ominous introduction to Hell’s Bells, the opening track.  It was a competition in our neighbourhood, in western Sydney, to see who could play You Shook Me All Night Long the loudest.  I even went into hock and bought a fancy new graphic equaliser to enhance the sound.  Those were the days.
I went to see AC/DC the following year, supported by The Angels and Rose Tattoo, and last year went to see them again, with my eldest teenage daughter, at ANZ stadium.  I would have gone twice had I been able to get tickets.  It rained during Thunderstruck during the first concert, after all.
It then comes as little surprise to find out that Back in Black is on high rotation in my car or whenever I am at home by myself.  Julia, my wife, likes Foreigner, which goes some way to explaining why she married me.  No taste at all.
Back in Black is an album of power, asserting class values and music’s ability to invigorate attitudes that some might not find palatable.  It is sexist and selfish, but it’s also ironic and piss-taking.  It was, and still remains, wild colonial convict music; in a word – Australian.
It is the first album I would grab in a house fire or take to a deserted island.
Assuming one could actually play music on a deserted island, what record would you grab first?  Better still, next time the conversation starts tanking at a barbecue or dinner party ask your friends to name their top 10 albums.  No compilations or live CDS are allowed, just original works.
Heck, work is (was, that is) so slow at present; why not jot down your list right now.  I bet you will want to revisit it within the hour.  I did mine – see below – several days ago, and am still not happy with it – there is no Bob Dylan, Neil Young, Eagles, Cold Chisel, Steve Earle, John Mellencamp, Rolling Stones, The Who, Joe Walsh, Cowboy Junkies and only one album from Tom Waits.  It is much harder than you think.
<ol>
<li>
Back in Black, AC/DC</li>
<li>
Born To Run, Bruce Springsteen</li>
<li>
Mule Variations, Tom Waits</li>
<li>
LA Woman, The Doors</li>
<li>
I, Flathead, Ry Cooder</li>
<li>
Wish You Were Here, Pink Floyd</li>
<li>
Late For The Sky, Jackson Browne</li>
<li>
Some Days You Eat The Bear…, Ian Matthews</li>
<li>
Beneath This Gruff Stuff, John Hiatt</li>
</ol>
10.  Cosmo’s Factory, Creedence Clearwater Revival
Remember, rock ‘n’ roll ain’t noise pollution.
PS  This year, statistically at least, I reached my half-life.  I now have fewer days in front of the horse than riding in the back of my cart to paraphrase another favourite artist, John Mellencamp.  Also April, our eldest daughter turned 18 a few months ago, and she is “out and at them” down in the apple isle, and her sister – Savannah – who at just 16, is on a 12-month exchange in Finland.  Proud yes!  But sometimes you just feel old –  well, older at least. 
Michael Matusik is the director of independent property advisory Matusik Property Insights. Matusik has helped over 500 new residential developments come to fruition and writes the weekly  <a href="https://matusikmissive.wordpress.com/" target="_blank" title="Matusik's Missive">Matusik's Missive</a>.
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Back in Black: Welcome to your half-life

<a href="https://www.apartments.com.au/developments/broadbeach-qld-4218">Broadbeach</a> offers plenty of reasons to live vertically, but moving from a substantial family home into an apartment can expose the compromises of high-density living. Privacy, room for guests and usable living space tend to matter more when an apartment is intended as a permanent home rather than an occasional coastal base.

A typical residential floor at <a href="https://www.apartments.com.au/new-apartments/the-eveleigh-broadbeach-7-9-surf-parade-broadbeach-qld-4218">The Eveleigh</a>, on Surf Parade,&nbsp;contains just four apartments. The 94-residence development by <a href="https://www.apartments.com.au/developers/hirsch-faigen">Hirsch &amp; Faigen</a> is predominantly made up of expansive three-bedroom homes, with a limited collection of half-floor penthouses above.

Across the apartment floors, <a href="https://www.apartments.com.au/architects/rothelowman">Rothelowman</a> has used the relatively limited number of residences to give each home greater access to natural light and outlook. Living spaces extend towards full-height glazing, while a series of bay windows frame selected views across the Pacific Ocean, city and hinterland rather than treating the building edge as a continuous wall of glass.

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[smartcode_project:default project_id=149670 project_image_fid=360965]

“The apartment floors deliver a collection of homes that embrace controlled outlook via a series of bay windows deliberately framing moments of view,” Rothelowman Director Kim Lowman said.

From outside, those projecting forms contribute to the tower’s faceted profile. Strong horizontal and vertical elements establish its proportions, while the changing position of the sun alters the light, shadow and reflection across the façade throughout the day.

The same attention moves inside the apartments, where the material palette combines warm timber, natural stone, metallic detailing and softer curved forms. Kitchens sit within the main living zone, with stone island benches, integrated joinery and European appliances, before the living areas extend towards the glazing and the outlook.

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[smartcode_project:default project_id=149670 project_image_fid=360981]

Three genuine bedrooms provide room to accommodate family and guests, while two secure car spaces and storage address some of the practical considerations that can become more noticeable when moving from a larger home. Feedback from the display suite has centred on the warmth and restraint of the interiors, with buyers commenting that the residences feel like homes rather than conventional coastal apartments.

A limited collection of half-floor penthouses occupies the upper levels, increasing the scale of the living spaces and adding private balconies and elevated finishes. From this position, the outlook extends between the ocean and hinterland.

Outside the private residences, The Eveleigh separates its shared spaces between the podium and rooftop. The podium is centred on wellness, with subtropical landscaping surrounding a swimming pool and pool terrace, yoga garden, private gymnasium, sauna and hot and cold plunge facilities. Landscaped retreats and pavilions provide additional places to sit away from the main recreation areas.

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[smartcode_project:default project_id=149670 project_image_fid=360966]

Higher in the building, a rooftop pavilion and private dining suite sit alongside resident lounge, barbecue and outdoor dining areas, opening towards panoramic views across the ocean, city and hinterland.

“Buyers are no longer just looking for an apartment, but a lifestyle where they can relax, reset, and enjoy a balanced way of living,” Hirsch &amp; Faigen Director of Sales Matt George said.

Interest to date has come from established owner-occupiers and interstate lifestyle purchasers, including buyers planning a future move to the Gold Coast. Many are coming from larger homes and want to reduce ongoing maintenance without giving up space for family and guests, privacy, two car spaces or the ability to entertain at home.

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[smartcode_project:default project_id=149670 project_image_fid=360969]

Much of that daily life can also take place beyond the building without requiring a drive. Kurrawa Beach and Pratten Park are an easy walk from Surf Parade, while Pacific Fair, Oracle Boulevard, The Oasis, restaurants, cafés, entertainment and public transport are also within walking distance.

The Eveleigh is Hirsch &amp; Faigen's fourth Gold Coast development since entering the market in 2021, following The Hemingway at Palm Beach, The Emerson at Kirra and Yves at Mermaid Beach. Each of the preceding projects sold out before completion.

“Broadbeach had been on our radar throughout our time operating on the Gold Coast,” the developer said. “Following our projects in Palm Beach, Kirra and Mermaid Beach, Broadbeach represented the natural next step for the business.”

The Surf Parade site brought together proximity to the beach, protected coastal outlooks and walkability to dining, shopping and recreation. Hirsch &amp; Faigen also identified the street as an emerging premium residential address, with enough separation from Broadbeach's busier destinations to retain a quieter environment at home.

The Eveleigh is now under construction by Maxcon, with completion forecast for mid-2028. Three-bedroom residences are currently available from $2.87 million.

[smartcode_project_cta:default project_id=149670]

Joel Robinson

The Eveleigh brings house-like apartments to Broadbeach

A long-stalled Campbelltown development site is back in play, with new plans for 139 apartments set to supersede a mixed-use scheme approved almost a decade ago but never built.

The new proposal for 28 Cordeaux Street would deliver 116 market and 23 affordable apartments in a part 14-storey building, bringing a substantial new project into a Campbelltown market where new apartment supply remains limited.

Plans have been filed over the 3,092 sqm corner site at Moore-Oxley Street, around 600 metres from Campbelltown Railway Station and the city-centre retail core.

The site already carries a mixed-use residential approval dating to 2016. Doroch Architects has now been engaged on a larger replacement scheme, which is progressing as a State Significant Development Application following a Housing Delivery Authority determination in August 2025.

The apartment mix comprises 39 one-bedroom, 72 two-bedroom and 28 three-bedroom residences. Two-bedroom apartments make up just over half of the project, while three-bedroom homes account for 20 per cent.

<img alt="First look: New 139-apartment plans revive long-stalled Campbelltown city centre site" data-entity-type="file" data-entity-uuid="136dd5b9-3791-4da6-9e31-76f533f5b4de" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Campbelltown%20da2.png?VersionId=LgOSy9nwf5u.MGswBBwaGGxuX8QpHSl_" />

Of the 139 apartments, 23 will be delivered as affordable housing under the in-fill affordable housing provisions of the Housing SEPP. The affordable component represents 15 per cent of the residential gross floor area and will be managed by a registered Community Housing Provider.

Doroch has sought to break the scale of the building into two distinct elements, with a masonry podium of around four storeys establishing the street edge before the residential tower steps back above.

The corner position has shaped that approach. Cordeaux Street faces toward the commercial and civic centre, while Moore-Oxley Street leads into the lower-scale residential neighbourhood to the south, and the design verification report describes the site as "bridging the commercial core to the north and established residential areas to the south."

The podium will be expressed predominantly in face brick, while the upper levels shift to brushed and grooved concrete cladding with darker metal detailing. Recessed sections, deep balcony edges and landscaping break down the upper form, with an approximately 11.8-metre setback to the northern boundary addressing the adjoining St Peters Anglican School.

<img alt="First look: New 139-apartment plans revive long-stalled Campbelltown city centre site" data-entity-type="file" data-entity-uuid="c8b3d2d3-c561-4bfc-a5d9-a68c0c10dac1" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Campbelltown%20da1.png?VersionId=AeAEyJU02Gk2k5noUj2StziCvdQ7fW4B" />

Campbelltown has been starved of new residential developments in the last decade.

The only other notable development set to come to market this year is ALAND's Queen Square, a mixed-use precinct on over two hectares that will comprise apartments above a vibrant ground-level retail and hospitality dining precinct.

First look: New 139-apartment plans revive long-stalled Campbelltown city centre site

First Look: Sherlock Construction pitches apartments for low-rise Deception Bay

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.

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.

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Michael Matusik

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