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While today there might be many varied definitions of “family”, one the most natural ways to describe a family is a group of people living together and functioning as a single household. And no matter how we choose to describe families, be they based on social, economic, ethnic or traditional ties, the family unit has a big impact on the property industry.
By being aware of how “family formation” impacts our market we are better able to engage people at different stages of their life journey but also ensure that we are delivering product that will meet their needs. Some of the impacts are easy to highlight: with a growing family there will be a need for more space, people get married, they break up, households reduce in size as kids head off, we relocate to secure employment, health becomes an issue and this can for example lead to people looking to reduce travel times.
As we move through these cycles, the impact on the structure of the housing market is a big issue, and marketing needs to be well-versed with the changing face of the communities in which we work.
The singles market
The singles market is the starting point. It is also a demographic that is at the pointy end of the housing market (because singles are the most mobile part of the market) and it is therefore capable of generating big changes. The single person has always been the take-off point in the housing cycle, but the composition of this group is also fluid.
What might have been a typical pattern a few decades ago would have been for the majority of single persons to get a job and leave behind the family nest and for many before they were 21.
This move out of home might have also included going to university and may well have led to some years in shared accommodation, and it still does. Shared accommodation is a common first encounter with the real estate market for many people – shared rent, bonds and responsibility – the first step on the housing ladder and a target market for investors, no doubt.
Then some time after with a secure job and some money saved, the aim might have been to buy a small apartment in an area close to work so that friends and familiar things were nearby.
Today while these steps are still recognisable ones, the singles market has changed. Many young people are staying put longer with mum and da. Household sizes as a result are now increasing in real terms and this may well be fuelling future pockets and periods of pent up demand.
Singles are not only living with parents sometimes into their 30s, but also with their partners, and sometimes still in shared accommodation. There are different spins here that can be seen as impacting the demand for better quality rental apartments.
Well-paid singles are sharing expensive homes and apartments; their choice is to pay higher expenses including higher rents so that they can enjoy homes they could not normally afford alone. In many markets the rental on a million-dollar apartment may well be less than any mortgage.
Then when singles do eventually buy into the market many are looking at doing so alone. As greater numbers either do not marry or stay single longer, they look for well-located apartments close to great facilities and lots of social connections on offer.
This group then as a result, is looking for quality apartments, but they are happy to forgo space for better social access.
We have already seen for some years now, increased demand for this style of accommodation in almost every major CBD and developments have been deliberately designed to meet this demand.
Here come the kids
Single, turns to being partners and then, for some, here come the kids. The arrival of children is another big incentive and reason to consider moving house, possibly the biggest and having children has once again become a big factor in the housing market.
But in today’s market it is now more complex part of family formation because parents can be older, same sex, with more money and with a greater eye on facilities like childcare and schools. Currently birth rates are stable, we have a higher birth rate than the UK, Canada or Singapore but we lag behind New Zealand and the USA. We are not exactly a match to the 1950s and ’60s, but still growing, and a trend that will have its own set of impacts on the housing market.
What is no real surprise is where families move to as their focus and needs changes. With a trend for more children to be placed into early and ongoing childcare, the backyard is not so important. What is more important is assess to quality facilities and easy transport to and from work and home so that not all day is taken up with travel.
Couples are also having children later, and grandparents are more involved, both factors that might lead those trading house to look to stay close to established family ties.
Getting a bigger house is one of the leading impacts on the housing market. The 2011 census shows that detached homes still make up the biggest part of Australia’s housing stock at 75.6%, apartments account for 13.6% and most homes are three-bedroom, at 43.6%.
However, the figures do vary from state to state and metro region to entire states – Sydney, for instance, has to 58.9% detached homes and 27.6% apartments with terraces and townhouses making up a further 12.8% of housing stock.
As we move through the issues impacting family formation it is impossible to miss the connection between these everyday shifts in lifestyle and how they impact project marketing. Reaching out to our targets requires a deep understanding of how best to communicate and what type of product projects need to supply.
As more people live in apartments, as they live there longer, and with more families, and with varied generations; then providing residential developments that match this more complex market impacts on demand, design and construction.
Communal areas are important and more a focus being inviting shared spaces, not just utility spaces. And while care needs to be taken by not over-inflating costs, developers are keen to give buyers some ways to express their individualism.
We are seeing examples where the facades are faceted and under the control of individual owners, with balconies of varied shapes being more common and different colours used on the exterior to also give each apartment a personality. These are changes that I feel reflect how family formation is being accommodated as the apartment market matures along with shifts in target demographics.
I would be keen to have your thoughts on this very human side of the development market, and in particular are we keeping pace with the social changes and shifts taking place.
Peter Chittenden is managing director for residential of <a target="_blank" href="https://www.colliers.com.au/Colliers%20Corporate/Residential.aspx">Colliers International</a>
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The changing nature of families, and their impact on the property industry

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<a target="_blank" href="https://www.propertyobserver.com.au/demographics/results-of-2011-census-will-help-developers-find-the-most-suitable-project-for-the-market-peter-chittenden/2012062555261">Recently I made a brief reference to the release of the 2011 census</a>. And while I will doubtless return to the census results, I was reminded of my own regard of how an understanding of the impact social change is a key influence on the housing market, and in turn how we manage the guiding principles of our marketing.
In particular I have always had respect for an understanding of how the major factors of “family formation” influence demand in the housing market. They are generally acknowledged as driving much of the demand for housing because as family structures evolve so do housing needs.
Population growth from internal and external migration will always be of critical importance. In many cases migration can also be linked to changes in the family structure, such as the obvious example of family members relocating to another country. Also consider the impact of families relocating to another state or city to secure employment.
Families a wider meaning
Although in modern times the word “family: now includes a much wider definition than it did in the past, the social structures of how we live and who we live with, or who we do not live with, still acts as the major influence on where we look to establish our lives and homes and why we move to or from a particular area.
The trends also apply to varied degrees in a wide cross section of social and ethnic communities. Many of the strict boundaries between social class and ethnic origins have now broken down. But many communities based upon shared ethnic roots still play an important part in shaping some areas of our cities.
The importance of structural change in personal living arrangements appears then to over time to represent one of the main factors that drive demand for real estate. An awareness of these life changes is essential and can be used in many aspects of project marketing.
It requires little imagination to see the impact of what happens when a number of these key events occur in our own lives. While social structures will continue to evolve they are still essential elements in what helps to influence the choice of where we live.
And so I think there is real value in devoting time to explore these key influences, and be alert, as trends not only show up in the census but how they are impacting our own experiences.
From family home to own home, and all the steps in between:
When I was a young adult, it used to be that turning 21 involved getting a key to the door of the family home. Sometimes this was literally a real key to the door, so that you could enjoy your new freedom as an adult to come and go, or simply go and keep a key for those occasional return visits – as some commercials on TV would have us imagine with our washing in tow for mum!
Leaving home would clearly drive demand for new and more accommodation units. Either a first flat or a share house, this first step away from the family home was this step drove demand at a very basic level. Moving out of home clearly drives the first stages of new demand for housing.
While there will usually be many steps between moving into a first rented flat to a buying a house or apartment, new buyers entering the market are very important to the housing cycle.
Change in this area will have far reaching impacts, and we are already seeing this impact in our markets, as housing construction levels are now the same as they were in 1951.
Now research suggests that in their 30s and 40s some adult children are slower than ever in leaving the security of the family home, or just making the step to purchase their own home. Right now this is a real trend in the market, and the flow-through impact is, as highlighted above, extensive.
First-time buyers are seen as so important that they are more or less always given varied forms of financial incentive and encouraged to enter the housing market. The value of this assistance is valued at hundreds of millions of dollars and in NSW first-home buyers will receive a big boost from October 1, 2012. The rental market in 2011 is 29.6% of the housing market, up from 26.3% in 2001, which further highlights the fact that fewer new homes are being built and sold.
Now as the baby boomer generation, the parents of some of these late-to-leave-home adult children are starting down the path of retirement planning their housing aspirations and needs will also another huge factor in the market. The median age of all Australians is now 37, that’s two years older than 2001.
Much of the existing housing stock is owned by the baby boomers, and their plans are helping to fuel demand for new inner-city apartments. They also fuel much of the “change” trends.
Baby boomers (55-64) in empty nests are selling up and are not only still seeking an active retirement via a  sea-change or a tree-change, but a local-change as they move to sedentary retirement (65-74) and are looking to move from the large family home to a nearby apartment or townhouse in the community they know and love.
This is a market that has become so important it is now overflowing with marketing clichés. However if these same baby boomers, like some of their children, prefer to stay put in their existing homes, then another possible stream of activity and supply in the housing market is impacted.
There is also reason to suggest that more independent and healthy baby boomers are staying put because of the high costs associated with moving, a fact that is further amplified if house prices a flat and if moving also involved big stamp duty imposts.
While the impact of these two groups of themselves are hugely important they are only part of the wider picture driving demand, but they serve as important examples of the wider trends that project marketing needs to take into account.
The very real impact of family formation
Having started to look at the role and relevance of varied stages of family formation and in some cases family de-formation, (the impact of divorce is massive) it is very easy to see why this topic has always, for me, been top of mind.
In planning marketing for almost any project, this deceptively simple influence on the needs of consumers as their life-cycle shifts cannot ever be overlooked. There are many useful tips from what many of us either experience firsthand or see others experience.
Historically various reports, including many prepared by the Australian Bureau of Statistics, have pointed to the major influence family formation has on the demand for housing. Not to mention the wider trends picked up in research including the 100 years of census data that we all have access to.
The life cycle of most individuals and their families can be seen as a core factor driving and changing demand. It can also be argued that many of the changes to underlying trends will also point to future trends that the housing market will need to accommodate.
Peter Chittenden is managing director for residential of <a href="https://www.colliers.com.au/Colliers%20Corporate/Residential.aspx" target="_blank">Colliers International</a>
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What changing family structure means for the property market

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I suspect that like me you will have seen a few advertisements for investment properties, in particular those associated with large projects. A frequent selling point is to feature a happy smiling face or a happy couple proud of their purchase. They have it would appear not only secured some real estate, but seemingly also a new lease of life.
Another common theme seen in this style of marketing is that the copy will frequently refer to “long-term” goals and how this or that purchase took a lot of time to find and that our happy buyers “did a lot of research” before they made their purchase.
The depth of the property investment market also supports a raft of specialist magazines, with surveys of hot suburbs to invest in and profiles of savvy investors who have built up multimillion-dollar residential portfolios as popular content. There is little doubt that residential property is a popular investment and one that possibly connects with buyers at much more of an emotional level than, say, cash, bonds or the share market.
Despite the happy faces in the advertising, understanding and connecting with this market is a much more deliberate exercise than it might appear. Residential investors are a discerning market. To engage them successfully within the project marketing mix requires a great detail of work and ever more attention to detail.
Investors are not an isolated or second tier target group, which will just be swept up by general marketing. They may well be looking at the market much more critically than the owner-occupier market. So here are few key starting points to consider before we move further into this key theme.
The first step is detailed support
There can be no argument that within the project sales path investor marketing requires detailed and specialist support. One particular aspect that needs to be addressed is the reality that a major project will usually be expected to attract investors from varied areas, both in terms of geography and demographics.
The investment dollar is very mobile and usually lacks an emotional attachment to a particular location; other factors like rentals and potential capital gains from population growth will take priority.
To help demonstrate some of these key points, I am going to draw on the experiences within Colliers International. The credentials for which are established by the fact that over the last 12 months some $1.45 billion in sales came from 3,120 private investor transactions that covered 34 projects. These figures clearly demonstrate how big the local investor market is and reaching the market, as I have already highlighted, requires a weighty level of support.
A wide-ranging reach
Given the effortless mobility of today’s investor market, one key aspect is the need for a sales path that includes a broad network of investment intermediaries that should aim to cover the entire domestic market as well as international options. Both are key areas and while the scale of individual projects will be a key determinate, if the target market is carefully defined then reaching and servicing all markets is recommended.
However, what is important is the spread and reach of these groups. Within the marketing mix they can then be employed to help underpin any particular project and reach the most suitable target markets.
In most cases this will require a demographic split and an ability to reach groups like offshore investors, expats and buyers who might access opportunities by groups like accountants. My point here is that the investor target can be complex and they may not always be engaged by traditional marketing options.
The key idea is to extend the reach of the local sales team by establishing marketing partnerships, to implement sales through the varied qualified channels and so help deliver successful sales results.
The management of key resources and information
The marketing of a major project will always involve a great deal of information and the need for secure and reliable communications.
In looking at a wider marketing community, which can include financiers, investment groups, conjunctional agents or offshore specialists, the project team will need to deliver to the entire marketing effort core sales tools, such as investment reports, floorplans, depreciation schedules, etc. An easy way to do this is via secure internet portals.
Investor reports – a foundation document
No matter how they are prepared or by whom, investor reports should be seen as the foundation document, the basis foundation required before taking any investment product to market.
These reports can be prepared in various ways and formats and when a project marketing firm like Colliers International is used, we prepare our own due diligence and research reports for each property and client. But no matter the mechanics these documents need to conform to best practice for property investment reports.
There is little doubt that the investor will pour over every detail in these reports, because from mum and dad investors upwards every investor has come to expect that investment opportunities will be presented in a concise format. Failing to do so is not only sloppy, but it can and will affect potential sales.
The benefits of producing a quality investor report will clearly increase credibility with buyers. The information needs to be fully tailored and supported by analysis and research because across-the-board and general statements will not be acceptable.
Peter Chittenden is managing director for residential of <a href="https://www.colliers.com.au/Colliers%20Corporate/Residential.aspx" target="_blank">Colliers International</a>
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Marketing to property investors requires detailed and specialist support

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I have to admit that I am excited. Excited about the release of the results of the 2011 census. I have always seen reliable demographics as the foundation of successful project marketing. We are very lucky to have the ABS as a resource; the organisation is a world leader.
I am also sure that no one would disagree that demographics are important and that access to current statistics even more so.
Most new developments are often being built in areas where rapid change is taking place. Populations are never really static, and change can include areas that are being gentrified as old industrial sites give way to residential projects.
Green-field developments will pose a slightly different hurdle, as the current population mix clearly has very little in common with the potential new community.
These are straightforward examples, however change is not always this easily defined. With each new census we usually see the big-ticket raw figures grab the headlines. But I see the changes that are not always visible as being the real keys to advancing many project marketing issues. Keeping track of demographic shifts and trends will help us all make sure the most suitable product is delivered to the market.
So the 2011 census figures are very welcome, but not only for the immediate headlines about this or that boom or surprising social trend. The longer-term value comes from a blending of the key social and economic trends that impact the demand for housing. 
How, for example, will the big changes in family formation impact demand and where people might choose to live? There are more older people and more singles, but where are the pressure points for population growth, and is growth being fuelled by new births or immigration?
The facts behind the growth and population trends always demand much closer scrutiny and it is vital to have up to date information on every local market you deal with.
These are key facts we can now look at in almost real time because of the delivery of the census. One area to briefly highlight is the changes taking place in some key age brackets. A quick review of the 30-44 age bracket shows they now represent just over 21% of the population. This is important because this group is more likely than any other to be the next immediate generation of home buyers. The 70-plus age bracket is also creeping up from 9.4% in 2006 to be 9.7% in 2011.
Australia’s housing stock has increased from 8,446,726 to 9,140,231 a jump of 693,505 new homes, with Sydney, Darwin and Canberra now sharing the highest median household mortgage repayments at $2,167.
I hope your share my enthusiasm for census 2011, and I am sure we will be sharing some of the many key results and their impact over coming months.
Peter Chittenden is managing director for residential of ;<a target="_blank" href="https://www.colliers.com.au/Colliers%20Corporate/Residential.aspx">Colliers International</a>
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Results of 2011 census will help developers find the most suitable project for the market

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Over the last few weeks I have devoted several posts to a discussion about state-based property charges, including stamp duty and various buyer incentives and grants.
Last week’s NSW state budget was built around incentives to encourage big numbers of new home buyers into the market alongside more funds for urban development. In my memory this was the first time I have seen these policy areas so markedly dominate a state’s budget settings.
There is little doubt that the measures will be welcome by first-home buyers. The basket of benefits for these buyers will be substantial and could be as much as $35,240. The first-home owners’ grant for new homes up to $650,000 from October 1 will be $15,000 until January 2014, when it will fall back to $10,000. Stamp duty exemptions have for first-time buyers have more or less been retained.
In addition to these direct incentives, all aimed at giving a big boost to construction of new homes and apartments, a proposed $500 million-plus fund is being established to fast-track urban infrastructure. The aim is to release more land in Sydney’s south-west and north-west. And there are similar policies on the drawing board for Melbourne.
However the zero incentives for trade-up buyers may well create a two-tier market. After all, already established home owners also buy new homes, they can in fact be more cashed-up and possibly more capable of selling and buying a new home. They may move from a smaller inner-city flat, for example, and this would also directly encourage new construction activity.
The incentives are welcome, and as the market responds the incentives and rebates may even help major developers to obtain finance for new projects because there will be more potential buyers in the market.
However, given the raft of changes and the various hybrids of the same ideas now available across Australia, the need for fundamental change to the current stamp duty regime remains an issue that has once again been postponed.
Peter Chittenden is managing director for residential of <a href="https://www.colliers.com.au/Colliers%20Corporate/Residential.aspx" target="_blank">Colliers International</a>
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The lack of incentives for trade-up buyers in NSW budget could create a two-tier market

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“Let’s buy an investment apartment” – now I am not really sure how many times I have overheard or been part of a discussion when this suggestion has entered the conversation.
With the financial meltdown of 2008 and the current wobbly state of many European economies the notion of any sort of investment has taken on new meaning. It’s reasonable to suggest that in the minds of many private investors it is security that is the main aspiration. How real estate will emerge over the long term is not yet clear, but I see continued evidence that investing in real estate is still a very popular idea.
Over the next few posts I am going to go over how reaching the private investor fits into the project marketing mix.
There is little doubt that Australians are generally attracted to property, and while they are not alone, they like it and understand it. It fits many lifestyle aspirations, and it’s a tangible asset.
The tax system encourages real estate investment and there are lots of options, including some new ideas, like adaptive apartments, to enter the market and with care the track record holds up well.
While individual circumstances will always be diverse for many people after the family home is under control, another financial goal is frequently to own an investment property. This can also be a preference that works in reverse where the acquisition of one or two investment properties can become the leverage to buy your own home.
The fact that the taxation system allows negative gearing, which can allow a tax deduction for investment losses, is frequently seen as a major influence. It’s a policy that is sometimes seen as having a harmful impact on housing affordability.
However, while negative gearing is a factor in the property investment market, according to a survey undertaken by the Australian Bureau of Statistics only 15.7% respondents noted negative as a key motivation to invest.
Target investors as a first base understanding
The figures are a little out of date (as last year’s census is yet to be released), but an estimated 28% of Australian households occupy rental accommodation, 22% of which is private investment stock the other 6% being public housing. This current figure indicates are large market for investment properties, and the stock is held by approximately 590,000 individual owners.
Investors by any measure play a major part in the housing market, and as a result they will always be an important and critical target market that needs to be reflected in the project marketing mix.
 
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However, while the appeal of particular projects could either encourage or conversely have limited appeal among investors it is important to have an insightful understanding of the target market. To assume that only owner-occupiers or mainly investors will be attracted to a particular project is too one-dimensional.
This is a particular need for full consideration in “transitional areas” where the demographic mix is in a state of change, such as inner city, fringe or former industrial areas that are being reshaped by development activity.
The ABS survey I mentioned earlier noted that investors highlighted the following as key pointers to their property investment evaluation:
<ul>
<li>Long-term investment</li>
<li>negative gearing</li>
<li>the generation of income</li>
<li>a future home</li>
<li>capital gains</li>
<li>unable to sell and family reasons</li>
</ul>
As the target market is defined it may well be clear that some buyers might also not be long-term investors, they might buy and then hold a property until their individual lifestyle circumstances change as they may have a plan to lease the property and then move into the property in the future.
Clearly what appeals to this target demographic is much more complex than might at first be apparent.
Their aspirations may not become apparent until your marketing team is some way down the sales path.
Projects that are very attractive to the investment community may well have particular needs and in some locations it will be necessary to engage the attention of the investment advisory community.
I think that it is safe to suggest that the appeal of direct property investment is a constant influence that many projects need to take into consideration. Some investors will always have a particular attraction to property despite the ups and downs of prevailing economic conditions.
The question is: is it necessary to undertake highly targeted marketing to reach this group of potential buyers?
In some cases the answer will be yes.
Before looking at what could be done to have direct appeal to investors, it is worth keeping in mind a very simple consideration. And that is the need for all marketing to be fashioned to appeal to the eventual person who will live in the project being promoted.
At the most fundamental level, why people are attracted to live in a particular property and location will be universal. The services, location, facilities and transport will be more or less of equal appeal.
However what will be different is the cost and the ability to afford a particular property, both as a purchase and as a rental option.
From a marketing perspective, what I suggest is that in very particular cases marketing does not need to be tailored only to appeal to investors.
There are exceptions and this would include the use of highly targeted investment media where the tone of material would need to address the specific environment.
For example, if marketing were to be placed in a particular media that only has an investor audience then the value attributed to the specific use of that media needs to be reflected in content.
At a particular stage of the sales path investors will require specific resources, such as depreciation schedules as one example, to be added to the mix of marketing material.
There may also be some more detailed work devoted to how a particular has grown when it comes to capital gains. However, once again this is not only the preserve of investors, almost any buyer will have an eye to past and possible future capital gains.
In any marketing plan, the potential impact of investors should show up in the early demographic assessment. 
Peter Chittenden is managing director for residential of <a target="_blank" href="https://www.colliers.com.au/Colliers%20Corporate/Residential.aspx">Colliers International</a>
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Sometimes a marketing campaign will be different if a project is targeting investors

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Over the past few weeks I have been taking a detailed look at the topic of stamp duty on property and how among other related issues, various state governments manipulate stamp duty in the housing market.
They do this to stimulate activity, however they are in effect adding an incentive to the market. Incentives in any free market are not new and in a project marketing setting they also have a function that extends beyond government to the development community.
The developer’s incentives
From a general marketing perspective the arrival of very big incentives, like the government incentives we saw in 2007, usually signal that the health of the market is not good. This usually results – and did at the time – in developers adding further incentives to the marketing mix, and not just incentives aimed at first-time buyers.
Depending upon prevailing conditions, such incentives in combination can add up to considerable value.
That could reach (as they did in 2007) as much as $40,000 or even $60,000, which is a valuable incentive to a buyer looking at homes in a middle price range. The total incentive on offer can be made up of a mix of grants, stamp duty concessions and developers rebates.
But an interesting question is: how do buyers react to such incentives? In particular when these incentives contain big contributions from the developer or with project homes from the builder.
A big topic of conversation is how should they be used in the promotional mix and what the pitfalls are when the incentives are either reduced or no longer available. It’s also worth considering if incentives are more or less always part of the “offer”, or do they simply retreat at different times and change form.
Or is it simply a reality that for the foreseeable future such incentives, both from the private sector and as a part of government policy, will be a fixture of the housing market?
A valid and long-term marketing tool
If we look at the impact of incentives and how “normal” they have become, in particular for first-time buyers, it does appear they are here to stay. But is this surprising? After all, buyer incentives are a part of almost all free-markets. Coupons (a way of life in the US), two-for-one offers, petrol savings, frequent flyer points, sales and discounts – the list is endless.
For some major parts of the residential property market, incentives have to some industry observers usually been associated with tough times. But is this the reality?  It could be more constructive to consider incentives as a valid part of a normal promotional mix, as it appears they become more common.
Many do not involve any sort of direct price discounting. This is in contrast to the private treaty market, where price alone is the only real mechanism to influence buyers.
I also suggest that it could be reasonably argued that being on an early release VIP list with a project is in fact a form of incentive, as it implies an advantage of time and possibly price. We can appreciate this is a logical goal from the perspective of many buyers.
The use of incentives can and does play a positive part of the project marketing arsenal. If incentives are well considered sales can be encouraged and the time scale of projects and holding costs reduced, possibly boosting the eventual return.
Just as with a major department store, any retailer or car manufacturer, holding unsold stock is an expensive thing and the cash tied up can delay other development opportunities. In a full sales path incentives should be seen as valid marketing tools, not an emergency Band-Aid or quick fix, and so they need to be deliberately and carefully managed.
 
 
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Buyer incentives
If incentives are used there will be some core points to consider. When should buyer incentives be used in project marketing matrix? What impact do incentives have on core brand values? Has the market grown tired of incentives or are they so much a part of the marketing offer that they are now a must? Or despite the wide spread use of incentives are they viewed with distrust among buyers?
There is little doubt that big-ticket incentive like the various state and federal government first-home buyer grants do work and can work fast, and they are more or less seen as permanent fixtures. Buyers like them and do not appear to consider them as panic tactics, and they are seen as a valid financial boost.
Some people in the industry will always comment that incentives are a waste of time, a negative. They say things like “any buyer will know that the free car or some other offer has been factored into the price”.
Or “do you want to live in a community where every second person drives the same free car or has the same free appliance package?”
Despite this type of feedback incentives are used and will continue to be used. Comments like the examples quoted are more likely to be associated with a now out-dated approach to incentives, when they were used in a much less focused and strategic way.
Incentives can be used in a very positive way and they can have a major financial value. Marketing budgets and the impact on the true net sales price are factors that have to be taken into full account. They will impact the cost of each sale as a valid marketing cost.
Positive incentives also help to foster a happy customer. Long after a sale is complete it might be the high-end new barbecue that buyers boast about to their family and friends, while the house itself fades into everyday life.
Many major project home developers now use upgrade packages, priced as incentives as a key part of their brand offer.
I have already pointed to the need to plan and manage incentives with care, because despite the spread of incentives in some markets they may need to be avoided and other ways found to encourage sales.
There is also some observation that in particular markets, some financial institutions have been discounting values by the worth of incentives and this can have a flow-on impact and so reduce the buyers’ borrowing capacity.
Nevertheless there needs to be a full appreciation of how incentives impact the market and how best they should be used in building a strong sales path for individual projects.
Peter Chittenden is managing director for residential of <a target="_blank" href="https://www.colliers.com.au/Colliers%20Corporate/Residential.aspx">Colliers International</a>
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When incentives should be used in marketing a new development

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It is soon evident in this discussion with guest Joe David, special counsel in the property and infrastructure group from national law firm Corrs Chambers Westgarth Sydney office, that in his well-exercised view, two key factors underpin the legal foundations of our property market: Torrens title (together with consumer protection legislation) and the quality of contracts.
Firstly 1858 marks the introduction of the ground-breaking Torrens title system of title registration (initially in South Australia), and today its “reputation” continues to build the security of our major residential projects.
According to Joe David, as a result of laws introduced on January 27th, 1858 by Sir Robert Torrens (see notes below), Australia’s internationally regarded property laws and land title system were soon to be the key foundation of the local real estate market.
And that is still so today, and as we will see spreading way beyond the borders of South Australia. However it is Joe’s view “it is the developer’s reputation and the fact that our property industry has kept pace with the expectations of today’s buyers that together so well service the needs of our present-day market.”
With over 35 years’ experience acting for major developers, Joe David talks about some very clear cut and valuable in-sights across the project marketing sector.
<img src="/images/stories/joedavid.jpg" width="350" style="float: left; margin: 5px;">
Joe is very well qualified to give up his time to take part in this series of posts. Heading up the developer sales group at Corrs, Joe has his focus on what he terms “the money end of the project”. From my point of view that’s a few very simple words that mean a great deal. After all it requires little conjecture to imagine circumstances where as Joe puts it, “if a contract is not watertight when it comes to settlement a developers investment could be at an unacceptable level of risk”.
The progression of quality contracts is one that Joe returned to frequently during our conversation. Throughout his 35 years, Joe has worked with many of Australia’s major developers including Mirvac, a group he labels “as trail blazers”, in particular for the way that it has been at the forefront in selling off-the-plan projects for more than two decades.
A great deal of his experience comes from being involved with a raft of major projects including Quay Grand, Newington (part of Sydney’s Olympic precinct), Jackson’s Landing and Walsh Bay.
“Many of the projects I have been involved with have included a wide range of title structures not only typical freehold and strata title, but also complex community title and leasehold projects and in some projects a mix of titles. Layer upon layer.
“These structures directly reflect in how contracts are drafted. They also imitate I think, the more complex nature of today’s urban environments and so this helps explain why in part contracts have had to become big and complex.”
It is against such a track record easy to understand why Joe David’s faith and understanding of property law in the project marketing arena allows us to observe some valuable and interesting insights.
In the sales and marketing of large developments, they can ‘suffer’ from being very complex for buyers to comprehend, and this is understandable and Joe is correct to highlight that the creation of any large community needs to be well documented as far as possible from the outset.
World-beating property law
Few would argue with his starting point – “It is good property law, the Torrens title system, that ensures title security, title that is guaranteed by a process of registration so that every buyer can have absolute confidence in the title of the property they buy.
“Our title system is paramount and we owe a great deal to Sir Robert Torrens. ‘Title by registration’ and how the title relies upon certified boundaries and registered plans, not only assures title but the exact description of the property is also clear, the registered lot and plan details.”
And with some major projects attracting offshore buyers there are clear benefits flowing from Australia’s title and contract security.
“With projects that are taken offshore Australia’s title system is proven to be popular with overseas buyers. Even where fraud occurs, there is a statutory system of compensation available. When you buy from the registered proprietor of real estate title with very few exceptions is guaranteed by the state.”
When I reflect upon Joe’s remarks, I suspect we should not always take the ‘advantage’ for granted. While fraud is very rare under our system, I feel that we should be re-assured that title does help to underpin major developments taken off-shore. Furthermore, our contracts enhance access to finance and the entire sales and marketing path runs efficiently.
More on pages 2, 3 and 4
 
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Contracts – the size of a telephone book
Joe rightly points out that the marketing of a project that is not yet built presents some hurdles for the developer and buyer. The buyer is looking at the product we are selling that may frequently be on a site where no work at all has yet to be undertaken.
Then under most circumstances the developer will be looking at a commitment of tens of millions of dollars or even much more, naturally while this is a backdrop we are all familiar with it is one that requires a secure and detailed contract. The contract needs to work to meet the needs of everyone involved in each transaction. I think it is also important to remember that some projects can involve hundreds of individual contracts, and this can create extraordinary pressures.
For example in talking to Joe, a major release or launch can bring any number of buyers together, in a limited time, in a competitive sales path, where contracts must run smoothly and result in secure transactions. These pressures need to be addressed early and not surface during the launch day itself.
“Over a number of years contacts have become more complex and this is in response to varied circumstances, like those outlined while many will relate to the title structure of the project.
“This has also resulted in more detailed vendor disclosure – more community rules, management statements, complex strata titles that will have building rules to ensure that as far as possible the strata scheme runs well when the building is complete.”
Joe points to the fact that there can also be a mix of residential, retail and commercial users all within the one project.
“These sometimes very large mixed use developments, all give rise to varied rights and obligations and these need to be fully documented with clear boundaries, and rights between the different parties. After all nobody wants any sort of dispute aggravated by a poor set of management rules.”
However in Joe’s experience it is the reputation of the developer that is central and even the most complex documentation and contract cannot make up for a solid foundation underpinned by a AAA track record.
Over the last few years the developer’s reputation has become more important and even more so now that finance is a complex challenge for many developers.
“There is always the need to achieve ever-more pre-sales levels to gain finance, as banks and other sources of finance are now ever-more anxious that pre-sales contracts are secure.
“Financiers are looking very closely to ensure that results in ‘qualified pre-sales’ so that when the project is complete, as I have said earlier, the buyers will be required to settle. So that the sales will be there and secure at the end of what can be a long lead-time. When the building is complete and the buyer gets what they paid for, so does the developer and the contract has the central role of underpinning this.
“There could be circumstances where a weak or badly drafted contract could see buyers, look for ways not to settle and succeed because of some flaw in the contract.
“It’s I am sure obvious that if you have huge financial exposure at the end of a 2 or 3 year construction period with a lot of cash going out, the contract and the buyers need to be rock-solid.”
However in a complex market, the importance of secure contracts also extends beyond the document itself and the one-off relationship between the Vendor and Purchaser.
There are other factors that Joe cites including for example one person or entity buying several apartments, and there are limits on the ratio of overseas buyers to local buyers, because both these examples might increase risk, and today financiers are very risk sensitive.
“And so returning to the core of what we have been discussing I return again to highlight that at every level the quality of our contracts, financial requirements and security of title help to underpin activity, even in the most complex project.”
More on pages 3 and 4
 
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A fair balance
All contracts involve two parties and so a contact to buy into an off-the-plan project does however clearly need to work for all involved – the developer, the financer and of course the buyer must all have rights and safe guards.
“Because there are risks on behalf of the developer and there are expectations for the buyer, there are rights for all sides and again I have to come back to the importance of reputation, it’s so very important, and a solid brand for a major developer is bankable.”
Clearly the purchaser is making a commitment to a property they cannot see, to a property that they might not have title to for many years and it’s purchase will usually affect their future. Every buyer will also have to make a financial commitment.
Joe, like all of us, is aware that many projects being taken to market are large and complex thus creating a complex task for the project team.
“Until the project is finished the developer will not earn any income, they will not recover any of their costs and nor will they realise any profit. In fact until the project is sold and sales are settled the developers costs and liabilities, are almost open-ended, in a way it’s a like a vacuum.”
The contracts used in this environment, need to be fair and any rights that a buyer might have to cancel or not complete the purchase need to be for substantial departures. And while a definition of substantial can be hard to define unfair contract terms are now covered by legislation. There are some core areas to consider like any size variations of individual apartments, the quality and extent of finishes and the contract sunset clause.
“From a consumer’s perspective there has been some general heightened awareness of contract terms. The spot light given to ‘unfair’ contract terms associated with some industries, like telecoms and gyms has helped make consumers more sensitive.”
Again here we can see the importance of a developer’s reputation so that buyers can have the confidence in the delivery of quality products.
Some of the key issues that may be high on any list of concerns among buyers are according to Joe already addressed because of the more advanced planning criteria when projects go to market, as they have had to meet substantial council planning and other conditions such as heritage.
“Size variation is a major area of concern, and just what is an acceptable variation before any sort of compensation is due or a right to cancel is engaged. However a well-drafted contract will address this and also how any price adjustment is to be made.”
Is a variation of 3% satisfactory or is 5%? When this happens it is important that good will prevail, as the developer’s reputation will come into play.
“Contracts have I think kept pace with the growth of medium density living, and despite the fact that contracts are more complex, I do think that buyers do understand the limitations of what is involved.”
In general it is a remarkable stable environment
Pre-sales are very important, for apartments and also for house and land products. State and federal laws work to safeguard all contracts.
However according to Joe David the last 30 years has seen the experience of the project marketing field gain in quality and lessons have been taken to heart leading to a very stable market.
In addition to size variations in contracts, as we have discussed the sunset clause is in Joe’s experience also important.
In marketing a project there needs to be the assurance and security that it will complete on time, and in Joe’s view where there are circumstances when any increased lead time is needed this needs to be clearly addressed.
More on page 4
 
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Quality marketing information
While not a direct part of any contract, marketing information also plays a role in this topic.
Almost any project marketing sales path now involves the increased use of highly developed artists impressions, computer generated images and extensive display suites.
“In my view these items need to have a good level of accurate and reliable information and the reputable developers and their marketing agents are very experienced in doing this.
I would also absolutely encourage that items like inclusions are covered in detail. I am an advocate of adding more and not less meat – there will always be questions from buyers, – but it is important to ensure equivalent quality is provided and that descriptions and marketing material always avoids any sort of vagueness or uncertainty.
Floor plans and finishes schedules are also key elements, they need to be easy to understand, they need to have focus on the purchaser, and they are key elements in the contract that are always looked at.”
My view is that the marketing suite and core materials that Joe highlights like plans and finishes schedules are the face of the development, they in-turn underpin the developers reputation and so should never be approached in any sort of half-baked manner.
Comparison with auctions
And as we start to wind up this discussion with Joe, I was keen to get his view on a comparison of project contracts and the given popularity of auctions.
“We all appreciate that auction contracts are used for a completed product, they are so popular as the sale is binding ‘at the fall of the hammer’ – the sale is made and the property is sold. The auction aims to flush out the most willing buyers beforehand and can also deliver a much higher than anticipated price.
And while the two areas are very different, vendor disclosure also extends to auction contracts.”
Improvements
Thanks to Sir Robert Torrens and an excellent track record of contract development and professional marketing we look in good shape. In fact we have even exported our land title expertise to many international destinations including the Middle East and Singapore, still there are areas of improvement.
“I think reputation can never be under-valued. I do not think we will ever see a 2-page sales contract. However I think it is track-record, reliability, resources and trust that, alongside quality marketing that will continue to encourage improvements in this area.”
The industry sends out the call via marketing for consumers to come and see our projects and we invite buyers to make the purchase.
“We then need sound contracts to ensure clients receive their money in the end, and buyers receive a quality end property. All underwritten by trust and reputation.”
 
Note: A little bit af background
Sir Robert Richard Torrens (1814-1884), public servant, politician and land titles law reformer, was born in Cork, Ireland, son of Colonel Robert Torrens. On December 12, 1840 along with his wife he arrived in South Australia.
Years after arriving in South Australia local titles were in an unsatisfactory state and, as he put it, land was no longer “the luxury of the few”, therefore “thorough land reform … [was] essentially the people’s question”.
He stood for Adelaide in the House of Assembly elections of 1857 and, almost entirely because of his espousal of land titles reform, topped the poll. He was Treasurer from October 24, 1856 to August 21, 1857, he published a further draft of his proposed bill on April 14 and 15 and introduced it as a private member’s bill in yet a third form on June 4. He was premier from September 1 to 30, but no action was taken on the bill until November 11, 1857, when the second reading was carried. Despite very strong opposition, mainly from the legal profession, it passed through both Houses and was assented to on January 27, 1858.
Peter Chittenden is managing director for residential of <a target="_blank" href="https://www.colliers.com.au/Colliers%20Corporate/Residential.aspx">Colliers International</a>
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Torrens title and contracts underpin the legal foundations of our property markets

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In the days following the federal budget earlier this month the main debate appeared to be driven by political infighting. However, as the headlines start to settle I would like to talk about how changes to super contributions and taxes might be expected to impact the appetite for property among private investors.
The budget also anticipated further cuts to interest rates, and such an outcome would further add to the appeal of property investment. But I will return to interest rates shortly.
First up the history of concessional contributions is mixed, and the use of the federal budget to vary this area of policy is not uncommon.
One of the most notable policies meant that between May 10, 2006 and June 30, 2007, you could contribute up to $1 million of non-concessional contributions to your super fund. This figure looks very generous, as the current budget introduces a cap on eligible contributions for the next two years. If you are 50-plus the cap will be reduced from $50,000 to $25,000.
And while a $1 million contribution may appear overly generous for anyone on an average income, the cap has been on a downward trend from $100,000 in 2007 and 2008 to $50,000 over the 3 years 2009-2011 and now to $25,000 in 2012.
It had generally been anticipated that with some restrictions on the size of individual super balances, the $50,000 cap, which has been in place since 2009, would be retained. Now that cap has been delayed for two years. The other change is that taxpayers with an income of $300,000 and more will have to pay 30% on super contributions up from the current 15%. They do retain the 15% rate up to $25,000.
While it is true that the changes only impact high-income brackets I feel that these changes feed the perception that superannuation policy is an area where policy is more or less forever changing.
Investors dislike change, and if you fit this income and age bracket then other investments like property start to look very attractive. Even more so when the impact of negative gearing is factored in, plus there are the advantages flowing from current low stock levels, low vacancy rates and when it comes to creating wealth, property still looks good in terms of potential capital gain.
For all of these reasons, if your have extra cash available that might have gone to super, then the property alternative looks attractive. There was at least a general indication that in 2007, with $1 million cap about to end that some investors left property so now the reverse trend should not be that surprising.
If we now take a general look at the potential impact on interest rates both the federal government and opposition appear to have a steadfast commitment to cut spending. The risk might be that a return to surplus will dampen economic growth and so further fuel the need for more cuts to interest rates.
If there is slower growth where might this leave the housing industry?
There was no direct stimulus in the budget and so possibly any steps to boost a pick-up in construction will have to rest with the states. However, states some face their own budget deficits and current incentives are about to expire.
It appears that a boost to housing construction may not be on the horizon. However the move back to a budget surplus appears to be the right message given current international settings and this should be a positive for investors.
Peter Chittenden is managing director for residential of <a href="https://www.colliers.com.au/Colliers%20Corporate/Residential.aspx" target="_blank">Colliers International</a>
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Super change to encourage property investment

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When the GST came along on July 1, 2000 there was the "promise" that lots of other taxes, duties and charges, in particular state taxes would be abolished or at least reduced. But in the intervening years changes have been minimal and only at the margins, for example mortgage duties have been abolished in most states.
A policy change to remove or reduce the payment of stamp duty applied to real estate post-GST was and still is an illusive target. Today there are few indicators that any big changes are coming our way in the near future.
This is not to suggest that change will never come, in fact just the opposite. Various state governments are happy to use stamp duty concessions to stimulate various sectors of the market. They have become very comfortable with the idea of making concessions that are in reality no different from a promotion that a developer might offer.
Common incentives on offer can frequently target first time buyers, or older buyers or aim to stimulate construction activity. Sometimes these target groups are seen as disadvantaged and stamp duty savings can then be promoted in combination with other grants, like the FHB grant to directly stimulate activity.
However, this on-again, off-again approach can create market distortions and when the central idea is for example to stimulate the construction of new homes, it’s hard to argue why this application of stamp duty should not be removed permanently.
And I would have to suggest that such a change would need to be a national initiative. New construction is a major driver of economic activity and it has a huge flow on affect that runs deeply into many sectors of the economy and so the benefits appear obvious.
A national approach is desirable, to avoid different states simply chasing policy so their local market is not disadvantaged. Lets change the rules in this or that state so that an adjacent state does not gain all the advantages, appears to be a common theme. A national policy would also present a uniform market for international buyers looking at Australia, and avoid a major influx into any particular state. Again with the possibility of creating a local distortion.
The under supply of dwellings in almost all major markets is further reason to consider this permanent change to duty and with a predicted national undersupply of 170,000 forecast for 2013 (Source: BIS Shrapnel) removing stamp duty would hopefully kickstart the resources necessary to overcome this shortage.
Older buyers have a role to play
But this is not a simple area of policy, the predicated undersupply of new homes also needs to be compared with the already established housing stock, and there are some very interesting trends here that are for instance being impacted by older homeowners.
A study in 2010 by the Australian Housing and Urban Research Institute found that 84% of homes occupied by people over 55 were living in a home with one or more spare bedrooms. And while some of this spare capacity would be used for family or lifestyle reasons, downsizing was possibly being restrained by the impact of stamp duty.
In NSW there is an existing concession, where the Senior’s Principal Place of Residence duty exemption applies to people between 55 and 65 years of age buying a new house before 1 July 2012 when the concession is set to end.
Stamp duty concessions for older people downsizing would see more homes in established areas released onto the market and this would also have the impact of better utilising of existing infrastructure, as many of these homes would be in established areas.
Here I can see good reason for such a policy as funding new infrastructure is almost always sighted as one of the main reasons that high council levies apply in new residential development areas. But could I also suggest that this type of ‘recycling’ of existing homes and local infrastructure could be a solid argument to collect less stamp duty.
Such stamp duty incentives do produce structural change in the market as we have seen recently in Sydney. The $600,000 cap on the current NSW Home Builders Bonus has for example seen a big lift in the number of one-bedroom apartments coming onto the market, and they have proved popular with investors and first time buyers.
Post June 30 – what will happen in NSW?
When it comes to the undersupply of housing, I have already highlighted that NSW has the biggest shortfall of more than 101,000 dwelling forecast for 2013, and construction activity has lagged for many years. And this is even with some large land release area’s opening in the cities south-west and north-west.
Activity simply refuses to budge and this is despite what should be a big level of pent up demand, and yet regardless of the shortfall demand has failed to greatly boost construction. The pressure from pent up demand is somehow not materialising.
And while there will never be one simple answer, the impact of stamp duty must be counted among the reasons, and this would suggest that the current concessions for First Time Buyers should be extended across the entire market. The FHB market does not exist in isolation and market-wide activity would benefit.
A more general concession at a realistic price level and possibly over a sliding scale could help generate more extensive market activity.
Some may still argue that this could further dampen affordability if the exemptions for stamp duty was not only limited to first time buyers, but we need to keep in mind that there are other FHB grants and also these same buyers would have access to a wider choice of locations helping to create a deeper market.
The case for change
Stamp duty on real estate transactions is a big source of revenue for every state government. This is essential revenue, but does the burden fall fairly and is the ‘tax’ more complex than it needs to be. Clearly every state and territory government is happy enough to use stamp duty as a form of concession with varied and ongoing schemes, and so there are many precedents of sorts for change.
Australians generally pay stamp duty on all property transfers (accepting that there are varied and ongoing concessions) but on our principal residence we pay no capital gains and in 2012-13 according the Federal Treasury that concession will cost the federal budget $35.5 billion, that’s almost 9.5% of all federal government expenses.
Any move to change this policy would be almost impossible, but it is perhaps the absence of a CGT that permits other high property taxes, including stamp duty to be justified.
Stamp duty concessions are almost always tipped in favour of first-time buyers, and associated with new homes, but questions remain as to what impact this has on building activity. This is also as noted a more complex area because the concessions vary between states and they are almost always transitory.
Stamp duty is an unpredictable tax for the states and despite the cash flowing from the GST the revenue would need to be captured from other structural changes in the economy. But clearly stamp duty remains a barrier to everyone in the housing market, young, old and even those looking for greater flexibility with employment are possibly constrained by its impact, being reluctant to move.
There are, however, some more immediate changes possible that could include greater indexation of rates of duty, including the permanent removal of duty for first-time buyers and some appreciation of the fact that the duty applies to the final price of a new home where there would already be many other layers of taxation. When the duty is paid is also an area where policy could be modified, helping to reduce the up-front costs of buying a residential property.
With the NSW state budget set to be announced in two months' time, will change result with the possible application of duty concessions to the wider market?
However, let's hope that we do not take a lead from Queensland, where from August 1 last year stamp duty for owner-occupiers on property purchases increased. But in contrast at the same time to stimulate the building industry, discounts on stamp duty for anyone buying or building a new home were introduced, leaving existing dwellings to bear the brunt of the increases. That’s a mixed message by any conclusion.
Peter Chittenden is managing director for residential of <a target="_blank" href="https://www.colliers.com.au/Colliers%20Corporate/Residential.aspx">Colliers International</a>
 
 
 
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It's time for a major change to stamp duty

Property developer One Living, backed by former Macquarie banker turned investment manager Chris Green’s investment firm, has unveiled plans to bring more institutional capital into housing to help address the national supply crisis.

The New York-based investor has focused his firm, GreenPoint Partners, on addressing the supply shortage hitting middle market housing in Australia.

It is backing the new One Living business to develop more than 1000 units along the eastern seaboard. The new firm is starting with a development on Mona Vale Road, on the border of Mona Vale and Pymble, in Sydney’s Northern Beaches, with around 140 apartments planned. They are eyeing off more sites across the city.

With cost pressures rising in the industry, One Living’s model is to be a vertically integrated developer-builder, so it can respond directly to the housing gap by removing the cost inefficiencies embedded in traditional residential delivery.

“We are building a platform designed to operate at scale and starting in a market where there’s a clear need for quality, attainable housing,” One Living joint managing director Joseph Scuderi said.

“It’s that missing middle – it’s that attainable end of housing… that’s what most Australians invest into and what Australians can actually afford.”

<img alt="Mona Vale" data-entity-type="file" data-entity-uuid="798dfa93-4941-4db6-a696-31e9dc18e81c" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-28%20at%202.31.50%E2%80%AFPM.png?VersionId=mKBqi5C_DmeiXS.AtJkcR8LQIxqCqmFi" />

GreenPoint Partners brings years of experience assembling and scaling real estate operating businesses across major markets. And Green sees a big opportunity in Australia.

“For its size, sophistication and importance to the community, Australia’s living sector has remained largely under-institutionalised, which represents significant opportunity,” Green said. “GreenPoint identified that gap, assembled the right team, and is backing One Living to build a platform that is aligned to market needs.”

Green said being a builder-developer would give the company the capacity and flexibility it required to deliver reasonably-priced homes.

“We want it to be at that attainable level; not super high end luxury but at that attainable level,” he said.

<img alt="Mona Vale" data-entity-type="file" data-entity-uuid="74a5344a-4b26-4d4a-ada3-056b1220be77" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-28%20at%202.32.15%E2%80%AFPM.png?VersionId=vY8hXHO4reBMdO8ZXMWCNtGZJofUPQ3j" />

&nbsp;

One Living will undertake a component of affordable housing in its schemes, which it will own and operate, and it could also run build-to-rent on some sites.

Green praised local policy settings.

“The NSW government is being very supportive, strategic and pragmatic in terms of how do we generate more supply of housing,” he said. “We think it’s actually positive for development and the bit that’s been lacking at that attainable level is that it’s lots of relatively small private developers, whereas we want to create an institutional platform.”

One Living is also&nbsp;looking at high-density projects and could take on more institutional funding in the future.

“The way we will be able to achieve economies of scale is through size,” Green added.

Joel Robinson

One Living enters Sydney's new apartment market with Northern Beaches site acquisition

It's been several years since there's been an opportunity to buy a brand new townhome in Melbourne's coastal suburb of Mordialloc. Even apartment developments in recent times have been few and far between in the area.

Local developer LDS Property identified the gap in new housing, securing a site on White Street, directly opposite&nbsp;Woodlands Golf Club Mordialloc. They've recently launched&nbsp;<a href="https://www.apartments.com.au/new-townhouses/wm-residences-mordialloc-102-white-street-mordialloc-vic-3195">WM Residences</a>, just 13 townhouses which they have already started building.

Projects by Buxton Director Heath Thompson, who is selling WM Residences, says the townhouses x that perfect middle ground be

"Mordialloc residents have had limited options to downsize within the suburb, often forcing them to look elsewhere despite long-standing ties to the area," Thompson says.

"With very little comparable new supply coming to market, projects like WM Residences are well placed, particularly as buyers look to capitalise on current conditions amid constrained supply."

[smartcode_project:default project_id=134646 project_image_fid=6109]

The development, designed by regarded architecture firm&nbsp;<a href="https://www.apartments.com.au/architects/ewert-leaf">Ewert Leaf</a>,&nbsp;adopts a deliberately restrained architectural approach, focusing on simplicity, durability and liveability rather than overt design gestures.

The boutique scale is central to the offering. With only 13 three-bedroom residences, each home is configured to prioritise functional layouts and everyday use, supported by private terraces and secure two-car garages.

Ewert Leaf’s design response leans into a calm, neutral material palette. Interiors are defined by oak flooring, white walls and soft finishes, creating a consistent and understated backdrop. The approach avoids trend-driven detailing in favour of longevity, with an emphasis on natural light and spatial clarity.

[smartcode_project:default project_id=134646 project_image_fid=6110]

Beyond aesthetics, the homes are designed to meet contemporary performance expectations. Each residence targets a minimum 6-star energy rating, incorporating double glazing, comprehensive insulation and all-electric Bosch appliances.

The project’s location supports a walkable coastal lifestyle, sitting within close proximity to Mordialloc’s foreshore, Main Street retail strip and the train station. Local cafés and dining venues, including Suburbia Deli and Hendriks Café, are within a short walk, reinforcing the area’s established neighbourhood character.

[smartcode_project:default project_id=134646 project_image_fid=6116]

While <a href="https://www.apartments.com.au/developments/mordialloc-vic-3195">Mordialloc</a> is often defined by its beach and pier, the project taps into other areas of day to day living, offering easy access to local food, casual dining and transport, rather than positioning itself purely as a lifestyle retreat.

WM Residences reflects a continued trend across Melbourne’s coastal suburbs towards smaller-scale, design-led townhouse developments, particularly on infill sites where proximity to amenity is already established.

With construction commenced prior to its market entry, the project aligns with a growing preference among buyers for developments with visible progress and defined delivery timeframes.

[smartcode_project_cta:default project_id=134646]

WM Residences fills gap in Mordialloc townhouse market

&nbsp;

Developer GURNER™ Group has revealed $1.65 billion in residential sales nationally across the 12 months to December 2025, driven largely by the continued momentum of its Docklands wellness-focused precinct, Elysium Fields.

The sales result was generated across seven projects in Victoria and New South Wales, headlined by Elysium Fields, GURNER™’s $2.75 billion mixed-use precinct planned for Harbour Esplanade in Docklands.

The project has recorded more than $500 million in sales across the first three towers, equating to around 580 apartments sold.

The first tower, Helios, has now sold out of its 240 private residences, with GURNER™ preparing to release a premium penthouse collection comprising 15 three-bedroom penthouses in coming weeks.

[smartcode_project:default project_id=144441 project_image_fid=370975]

Elysium Fields is being developed on the long-held 20,000 sqm Docklands site at 208-226 Harbour Esplanade, which had remained undeveloped for more than two decades prior to GURNER™ taking over the project around four years ago.

Construction has now commenced across four towers ranging between 18 and 30 storeys, with Hamilton Marino and Maxcon appointed as builders.

Once complete, the precinct is expected to comprise around 1,100 residences, alongside retail, hospitality and public realm uses integrated throughout the site.

[smartcode_project:default project_id=144441 project_image_fid=370981]

Designed by Fraser &amp; Partners in collaboration with GURNER™ Design House, the project has been positioned around the developer’s broader focus on wellness-led residential living.

“We don’t sell apartments. We create a true luxury lifestyle that simply doesn’t exist elsewhere in the market today,” Founder and Executive Chairman Tim Gurner said.

“To deliver that requires an extraordinary level of detail, coordination and discipline across multiple verticals, from design and hospitality through to wellness and service.”

“We’ve always believed that living extends far beyond the physical residence. It’s about how you feel the moment you arrive, how you live day-to-day, and the ecosystem that supports that.” 
[smartcode_project:default project_id=144441 project_image_fid=370977]

The project’s design places a heavy focus on landscaping, wellness amenities and biophilic design principles.

Plans include around 3,700 sqm of landscaped gardens and open space throughout the precinct, alongside a retail and dining offering spanning approximately 5,000 sqm.

The broader public realm strategy centres around what GURNER™ describes as the “Path of Life”, an urban forest and landscaped pedestrian environment intended to connect the various buildings and wellness spaces across the precinct.

The apartments themselves will incorporate a range of wellness-focused inclusions, including purified air and water systems, circadian lighting, antimicrobial surfaces, and optional in-home wellness upgrades.

[smartcode_project:default project_id=144441 project_image_fid=370980]

Gurner said the company’s experience through its Saint Haven wellness clubs had directly informed the residential offering now being incorporated into Elysium Fields.

“We’re seeing a clear global shift toward longevity, performance and proactive health,” Gurner said.

“Our role is to deliver that in a way that feels seamless, highly private and beautifully resolved within the environments we create.”

A large component of the wellness offering is planned through the resident amenity and health facilities proposed within the precinct.

That includes plans for bathing and recovery facilities spread throughout the towers, incorporating mineral pools, saunas, steam rooms, flotation therapy, red light therapy and wellness lounges.

The developer is also seeking approvals for what it describes as a “reverse ageing medical clinic” within the precinct.

[smartcode_project:default project_id=144441 project_image_fid=370978]

According to project information released by the group, the proposed facility would include cryotherapy, IV infusion therapy, infrared and dry saunas, PEMF beds, MRIs, DEXA scans, brain scans and blood analysis services.

Within the first tower, Helios, residents will also have access to a dedicated amenity offering known as the Sky Private Club.

The upper 15 levels of the building will include private lounges, dining spaces, rooftop amenities and optional private wellness studios integrated within residences.

The Helios tower itself comprises 260 apartments ranging between 60 sqm and 300 sqm, including a collection of penthouses.

That includes a planned two-storey penthouse spanning around 600 sqm with uninterrupted bay views.

The Elysium Fields precinct is being delivered in partnership with Digital Harbour Holdings, a consortium that includes the Liberman family, which controls the development rights across the Docklands site.

[smartcode_project:default project_id=144441 project_image_fid=370979]

The sales result comes as GURNER™ continues expanding its national development pipeline beyond Victoria.

“We have a strong pipeline across Australia and are now focused on scaling into key markets including New South Wales and Queensland, while continuing to build on our Melbourne base,” Gurner said.

“We currently have more than $3 billion in the market, growing to over $5 billion by October, and expect to materially outperform last year in the 2026 calendar year.”

The result also reflects the continued strength of the upper-end apartment market in Melbourne, particularly for owner-occupier-focused product with large-scale amenity and lifestyle offerings.

[smartcode_project_cta:default project_id=144441]

Record result anchored by the Group’s “utopian” Elysium Fields precinct – defying market headwinds in Docklands.

Elysium Fields drive Gurner to $1.65 billion in apartment sales over 2025

National Australia Bank (NAB) will fund <a href="https://www.apartments.com.au/new-apartments/palmera-residences-gold-coast-18-garfield-terrace-surfers-paradise-qld-4217">Palmera</a>, a $1 billion, 52-level luxury residential tower being developed by Central Equity in one of the Gold Coast’s most tightly held coastal locations at Northcliffe.

The project, launched recently by <a href="https://www.apartments.com.au/developers/central-equity">Central Equity</a>, one of Victoria’s largest private residential developers, comes at a time when construction funding for large residential developments has become increasingly competitive as lenders tighten exposure to the sector.

Multiplex has been appointed the builder, and construction is now underway.

[smartcode_project:default project_id=108274 project_image_fid=365784]

Since its first project, Central Equity has delivered more than 85 residential developments with a combined end value exceeding $8 billion.

Palmera reflects Central Equity’s growing focus on the Gold Coast luxury apartment market and continues a relationship between Central Equity and NAB that dates back to the late 1980s, when the bank funded one of Melbourne’s earliest inner-city residential towers at a time when high-rise apartment living in the CBD was largely unproven.

“NAB’s funding of Central Equity’s $36 million CBD development in the late 1980’s to the financing of the billion-dollar tower today highlights the long-term relationship between the two organisations in delivering major residential projects” said Central Equity Founder and Chairman Eddie Kutner.

He said NAB’s early support was instrumental in helping establish the company’s development model.

“When we commenced our first residential tower in the late 1980s the concept of funding off-the-plan apartments was still largely untested in Australia,” Kutner said.

“NAB recognised the opportunity early and supported the project when others were uncertain. That relationship has now continued for more than 37 years across many developments.”

[smartcode_project:default project_id=108274 project_image_fid=365771]

Central Equity was established in 1987 when Melbourne’s CBD and Southbank precinct were still dominated by warehouses and commercial buildings. Fewer than 100 residents lived in Southbank at the time, and large-scale residential development in the inner city was not widely considered.

Recognising changing demographics and lifestyle preferences, the company began developing high-rise residential projects designed to bring permanent residents into the city centre.

Central Equity has provided accommodation for approximately 40,000 residents across Melbourne’s CBD and Southbank, while also incorporating supporting infrastructure including essential lifestyle facilities like retail spaces, childcare facilities and neighbourhood activity centres.

Central Equity has spent many years assembling the Palmera development site on the corner of Garfield Terrace and Frederick Street in Northcliffe, creating a supersite of around 3,300 sqm.

The developer said the Palmera apartment tower reflects its long-term view of the Gold Coast as a growing and increasingly diversified economy.

[smartcode_project:default project_id=108274 project_image_fid=365768]

Supported by infrastructure including the light rail network, major road upgrades expanded education, hospital and medical facilities and continued expansion at the Gold Coast Airport with more international and domestic flights.

Positioned in the tightly held Northcliffe precinct, the 52-level tower will deliver 347 apartments, targeting buyers seeking a high-end coastal lifestyle, from downsizers to interstate investors.

Designed by Marchese Partners with interiors by DBI, Palmera has been conceived as a next-generation residential offering, featuring a collection of oversized apartments, with premium three-bedroom residences offering sweeping northern views stretching from Surfers Paradise through to Burleigh Heads.

[smartcode_project_cta:default project_id=108274]

NAB funds $1 billion Surfers Paradise apartment development, Palmera

Two years after completing one of the newest developments in North Sydney, developer <a href="https://www.apartments.com.au/developers/aqualand-australia">Aqualand</a> is turning its attention to the rapidly evolving St Leonards apartment market.

The developer, which completed AURA by Aqualand on North Sydney's Walker Street, has lodged plans for a 5,918 sqm site at <a href="https://www.apartments.com.au/new-apartments/33-37-herbert-street-st-leonards-nsw-2065">33-37 Herbert Street, St Leonards,</a> seeking approval for a pair of residential towers rising above a shared podium opposite Royal North Shore Hospital.

The proposal forms part of the broader transformation underway across the St Leonards-Crows Nest precinct, where former industrial and commercial sites are increasingly being redeveloped into high-density mixed-use projects tied to major transport infrastructure.

<img alt="Aqualand" data-entity-type="file" data-entity-uuid="2cc428cf-fe70-4cac-9cd5-264ad53af62c" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-28%20at%209.51.56%E2%80%AFAM.png?VersionId=otKSnHtbjAvAddOnovyXQMgcAwE6DMe1" />

According to the planning documents, the site sits “within the St Leonards–Crows Nest Strategic Centre, identified by the NSW Government as a key area for accommodating future jobs and housing across Sydney.”

The proposal has been designed by fjcstudio, formerly FJMT Studio, and is being progressed through the State Significant Development pathway due to its scale and affordable housing provision.

The scheme would comprise 413 apartments, including 46 affordable housing units, alongside retail and commercial uses fronting Herbert Street. The project would also include communal open space, landscaping, a swimming pool, gymnasium, children’s play areas and podium-level resident amenities.

Planning documents show the development would consist of a part-13, part-39 storey tower form positioned above a four-storey podium.

“The development comprises a unified podium that activates the street interface, and two setback towers to accommodate new housing supply while maintaining an appropriate human scale at ground level,” fjcstudio noted in its Design Report.

The northern and southern towers have been shaped to respond to the surrounding skyline while also limiting overshadowing impacts to nearby public open space, particularly Talus Reserve.

The design report said the differing tower heights were intended to “contribute to a varied skyline while responding to the surrounding built form context and solar access considerations.”

<img alt="Aqualand" data-entity-type="file" data-entity-uuid="36da62dc-ff9e-41f2-a7e3-7be38373751c" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-28%20at%209.51.45%E2%80%AFAM_0.png?VersionId=Mo6Rp2r.XRLTzIfg_PEEpw8NepDH8UBs" />

The site sits directly opposite Royal North Shore Hospital and within walking distance of both St Leonards Station and the new Crows Nest Metro station.

While the site itself sits just outside the formal Crows Nest Transport Oriented Development boundary, the planning documents repeatedly reference its alignment with the broader TOD objectives reshaping the Lower North Shore.

“The site is located adjacent to St Leonards Station and in close proximity to Crows Nest Metro which is within the Crows Nest Transit Orientated Development Accelerated Precinct which has been identified by the NSW Government to support housing delivery,” the Design Verification Statement noted.

According to fjcstudio, the project has been designed to respond to the broader transition occurring across St Leonards, where increasing residential density is being concentrated around transport infrastructure and employment hubs.

“The broader precinct is undergoing significant change, with a mix of existing mid-rise buildings and newer high-density developments,” the report stated.

“Recent and approved projects indicate a consistent shift toward taller built form, typically organised as tower-and-podium typologies with more active ground levels.”

The proposal includes close to 6,000 sqm of retail and commercial space across the ground floor and podium levels, designed to create a more activated street edge along Herbert Street.

Aqualand’s plans would also introduce a landscaped podium shared between the two towers, with communal open space in the form of a podium rooftop designed to support resident interaction and improve urban greening outcomes. The scheme would also introduce pocket parks at the northern and southern ends of the site, including a landscaped area at the corner of Herbert and Ella streets designed to improve pedestrian amenity and soften the streetscape.

&nbsp;

The proposal is being progressed through the NSW Government’s Housing Delivery Authority pathway, which was introduced to accelerate housing supply across the state. The application was declared State Significant Development in April 2025 following an expression of interest process.

<img alt="Aqualand" data-entity-type="file" data-entity-uuid="faf6d97d-2671-454f-b85a-fe1c6a7be608" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-28%20at%209.51.49%E2%80%AFAM.png?VersionId=diVd28OBVr5.YV.7prrOz.uAanwwwm7a" />

St Leonards has been particularly active with new developments in recent weeks. Developer SP Setia’s <a href="https://www.apartments.com.au/news/nsw/first-look-sp-setia-targets-st-leonards-skyline-with-40-storey-tod-tower">plans for a new 42-storey tower</a> recently went on exhibition through the same pathway, while <a href="https://www.apartments.com.au/news/nsw/first-look-stockland-plans-52-storey-538-apartment-st-leonards-tower">Stockland’s 52-storey tower proposal</a> was also recently unveiled.

Aside from the St Leonards project, which is expected to take around nine months to move through the approvals process ahead of a potential 2027 launch, Aqualand is also preparing to launch Boronia, a new apartment project in Roseville comprising around 111 apartments on Larkin Street.

The developer also has approvals in place for the next stage of the Barangaroo precinct, which will feature new residential, retail, hospitality and community uses, alongside a new metro entry across the five-hectare site.

More than 50 new retail destinations are planned for Central Barangaroo, alongside a 270-metre-long boulevard connecting Hickson Park to Nawi Cove. Together with Harbour Park, more than 50 per cent of the precinct will comprise public open space and parkland.

Peter Chittenden

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