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Rating agency Moody’s has sounded a caveat for banks in Australian, Canada and Sweden, saying they are increasingly sensitive to economic shocks that could result from a slump in house prices after a more than 16-year surge. 
In the report, "Banking -- Global; Possible house price drop poses some risk for Canadian, Swedish, Australian banks," Moody's Investors Service compares the rise in house prices and household indebtedness. 
Between 2000 and 2016, house prices rose by 144% in Sweden, by 115% in Canada and by 113% in Australia. At the same time, household indebtedness has risen sharply, and mortgages now account for 63% of the banking systems' total loan books in Australia, 48% in Sweden and 39% in Canada. 
“Housing market corrections are often triggered by an economic slowdown, but even when they occur without any economic trigger, the attendant uncertainty can weigh on consumer confidence. This can in turn contribute to a slowdown in economic growth, which if severe enough can increase losses across the full range of banks' loan portfolios,” Moody’s said in the report.
“Between May and September 2017, we took rating actions in all three banking systems to reflect this risk, although lenders in these countries remain among our most highly rated globally.” 
Moody's base case is that house prices will continue to climb in Canada and Australia, albeit at a slower pace over the next 12 to 18 months, whereas preliminary data suggest that the housing market may already be turning in Sweden. 
“If there were a house price correction in any of these countries, the combination of protective features built into their mortgage markets, banks' underwriting practices and full recourse loans would limit mortgage losses,” it said. 
"Nonetheless, banks in these countries are exposed to second order effects," said Louise Lundberg, a Vice President and Senior Credit Officer at Moody's. 
Lundberg elaborated by saying that an economic slowdown that would likely accompany a substantial house price correction would lead to higher losses on consumer loans, commercial real estate loans, and loans to consumer-exposed corporates.
In most scenarios, Moody's said it expects banks in these three countries to be able to absorb any loan losses through their earnings. 
“Any impact on their capital levels, which we currently assess as strong to adequate, would likely be limited,” it said. 
Assuming unchanged earnings (although these would likely be negatively impacted in a stressed scenario), loan losses could increase to 2.2% of gross loans in Canada from 0.4% in 2016, to 1.8% in Australia from 0.2%, and to 1.4% in Sweden from 0.1% before eating into capital. 
In Australia, macroprudential measures recently announced by the regulator will likely constrain credit growth, particularly growth in loans to property investors, who account for around 35% of all new mortgages. These measures, along with more stringent underwriting criteria, are likely to reduce customers' borrowing capacity. Overall, we expect the rate of house price appreciation over the next 12 months to slow. 
Rising house prices have led to a sharp decline in housing affordability in all three countries (see Exhibit 2). 
<a href="https://www.propertyobserver.com.au/images/2017/11/21/Exhibit2.png" target="_blank">Click to enlarge</a>
<img src="https://www.urban.com.au/images/2017/11/21/Exhibit2.png" alt="">
Canadian, Swedish and Australian household debt has also risen strongly (see Exhibit 3). Household leverage is highest in Australia, where it reached 212% of net disposable income in 2015, and has risen further since. This compares with 183% in Sweden and 176% in Canada (2016 data). 
<a href="https://www.propertyobserver.com.au/images/2017/11/21/Exhibit3.png" target="_blank">Click to enlarge</a>
<img src="https://www.urban.com.au/images/2017/11/21/Exhibit3.png" alt="">
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Australian banks among international lenders exposed to second order housing impact: Moody's

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Two fashion and accessories tenants have signed up for new spaces within the popular Puckle Street retail strip in the inner Melbourne suburb of Moonee Ponds. 
Casual wear label Sportscraft has leased at 63 Puckle Street, while 66 Puckle Street has been taken up by fashion accessories and handbags retailer Colette by Colette Hayman. 
Sportscraft signed a three-year deal with further extension of three more years at $95,000 per annum net with 4% increases for the 200 sqm space, which was offered for the first time in four decades.
Colette by Colette Hayman will move into the 150 sqm shop on a five-year lease with a further five-year option and pay $80,000 per annum with 4% increases. 
The lease was negotiated by Fitzroys agent Terence Yeh.
He said the strong results and long leases demonstrate tenants’ confidence in the area. 
“Puckle Street’s limited amount of spaces available - totalling around 150 shops - offers businesses greater access to the local catchment population, further underpinned by the number of residential dwellings introduced to the area in medium and high-density developments.” 
There are more than 1,500 apartments within the Moonee Ponds Activity Centre in various stages of planning and development, generating confidence among businesses for the retail strip’s long-term viability. 
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Clothes and fashion retailers sign leases in Moonee Ponds retail strip 

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National Australia Bank (NAB) has sacked 20 bankers and disciplined another 32 for selling home loans to customers whose eligibility may have been in question.
NAB said in a media release it had “commenced a remediation program for some of its customers, after a review identified their home loan may not have been established in accordance with NAB’s policies”.
Around 2,300 home loans since 2013 have been identified as submitted without accurate customer information and/or documentation, it added.
The bank became aware of the matter in October 2015, and advised ASIC in December 2015 after an initial high-level review. 
“What occurred was unacceptable. We have investigated this matter thoroughly, and, as we have always said, whenever we find issues we will investigate them, fix them, and hold people to account – and we did,” said Andrew Hagger, NAB’s chief customer officer, Consumer Banking and Wealth.
Following the investigation, 20 bankers in New South Wales and Victoria have been sacked while another 32 bankers had “consequences applied” including pay cuts.
Many of the customers who took the loans in question are from overseas and NAB has has commenced writing to them asking them to participate in a detailed review of their loan, which may include verification of documents submitted at the time of their home loan application. 
It said affected customers may be offered compensation as appropriate.
NAB said it is working with ASIC to ensure the remediation program provides fair outcomes for customers. 
“The remediation program has been designed with reference to the methodology applied by the Financial Ombudsman Service, and with NAB’s standard approach to compensating customers. NAB will engage an independent expert to undertake regular audits of the remediation program, and will update ASIC every two months on its progress,” said the media release.
“I want to assure all of our customers that we have improved our systems, processes and programs as a result of what occurred here,” Hagger said.
The changes will apply to NAB’s Introducer Program, including enhanced governance and eligibility criteria.
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NAB sacks 20 bankers for incorrect documentation on 2,300 loans

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Two residential properties in the historic suburb of Millers Point, including Sydney’s first ever walk-up apartment building and an entire row of period terrace duplexes, will be sold through auction on December 14.
There is a price guide of $9 million to $9.5 million, which will be the second most expensive Millers Point disposal, after a block of 12 apartments at 44-48 Merriman Street and 56-62 Bettington Street sold for $12.3 million in 2016.
They are being sold off by Property NSW on behalf of Family and Community Services as part of the Millers Point sales programme to fund social housing. So far, the sales have delivered more than $467 million.
As of August, 655 new social housing dwellings have been completed and 422 dwellings are under construction, Property NSW said in a media release.
‘Stevens Buildings’ at 73 Windmill Street (picture above) is of architectural importance and is recognised by the NSW Trust as the first residential apartment building to be constructed in NSW.
Designed by renowned architect Joseph Alexander Kethel (1866-1946), the heritage building sits on a 1,802 sqm site and comprises 11 apartments (nine x one bedroom and two x two bedrooms) capturing views of the Sydney Harbour Bridge, Garrison Church and Observatory Hill.
It was built in 1900 as a boarding house on the site of the former ‘Live and Let Live Hotel’ and was the first walk-up block of flats in Sydney.
Some apartments offer dual aspect and flow through. All have open balconies with the ground floor with its own courtyard.
The other building, 74-80a High Street, comprises eight two-bedroom period terrace duplexes divided into two blocks each comprising four apartments on a 539 sqm island site. 74-80a High Street is expected to fetch about $8 million to $8.5 million.
The block is one of a group of early twentieth century workmen’s apartments built by the Sydney Harbour Trust in the early 1900’s.
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/11/10/74-80aHighSt.jpg" alt="">
There is scope to transform the apartments to their original condition, subject to Conservation Management Plan (CMP). The solid brick construction boasts deep verandahs, spacious kitchens, living and dining areas, with the first floor duplexes also comprising roof-top drying terraces with panoramic views across Barangaroo, Balmain and Darling Harbour.
Both addresses will be sold in one line (separately) via public auction through Robert Lowe and David Hickey of Savills Australia and Richard Shalhoub of Sotheby’s International Realty on behalf of Property NSW.
“This is a truly unique occasion for investors and developers alike to own a piece of Sydney’s rich heritage” said Robert Lowe of Savills.
Richard Shalhoub of Sotheby’s International Realty added that there was potential to transform the 1900’s historical masterpiece ‘Stevens Buildings’ into luxurious residences.
“There is actually tremendous scope to restore and transform both assets which are zoned as R1 General Residential, which will provide housing needs for the community and maintain the existing land use pattern of predominately residential use and we expect interest from both local and offshore investors and developers” he continued.
Separately, McGrath Estate Agents have also started marketing the following properties that are to be auctioned on December 6:
<ul>
<li>40 Merriman Street - one bedroom terrace</li>
<li>42 Merriman Street terrace - one bedroom terrace</li>
<li>125 Kent Street - four-bedroom terrace</li>
<li>46-48 Argyle Place - five-bedroom terrace</li>
<li>88 Kent Street terrace - four-bedroom terrace</li>
<li>61 Windmill Street terrace  - three-bedroom terrace</li>
<li>70-72 High Street - block of four apartments, each with 2 bedrooms</li>
</ul>
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Sydney’s first walk-up block of flats for sale in Millers Point

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Australian home buyers spend an average of $1,618 on the cost of physically moving home, equating to $863 million a year, says a recent ING research.
The average total cost of moving was based on 1.6 million households moving in the last three years. 
Relocation costs includes the cost of packaging, removalists, cleaning and reconnecting utilities.
Half (50%) of Australian home buyers do not budget for costs associated with moving, while 48% said they spend over their estimated budget, according to ING’s Cost of Moving Home report.
The research was conducted by Galaxy Research on behalf of ING in September 2017 with a sample of 602 Australians aged 18-64 years, distributed across Australia. 
“When saving to move home it’s important to put aside some money for the actual move itself. Our research shows many Aussie home buyers are left empty handed by the unexpected costs of moving from one home to another,” said Tim Newman, ING’s head of product. 
The costs extend to other areas as well. Nearly 3.24 million working days in total are lost every year from homebuyers taking time off work to pack, move and unpack, the report said.
More than half (59%) of Australian home buyers said they took time off work to move, with the average amount of leave taken per person being 3.5 days. 
Many (53%) of the respondents were frustrated with the extra costs associated with moving home. 
Top of the list was ‘the extra trips you have to make to get things’ (33%). Following this, ‘when things are broken or scratched’ (24%), ‘extra removalist fees’ (13%) and ‘insurance costs’ (8%). 
Newman suggested that the cost of moving homes could be reduced by almost $1,000 if home owners chose the DIY approach. 
“While the average cost of moving is $1,618, if you are willing and able to move without a removalist, the cost is significantly less: an average of $624 according to our report.” 
Home buyers can also recoup money spent on the cost of moving by looking at other ways to save when it comes to the costs associated with their property. 
According to research on switching by ING, Australians who switched their home loan provider within the last two years made an average annual saving of $1,073 per household per year. 
“Home owners might want to look at switching their home loan to get a better deal, particularly when they move, considering the savings that can be made,” said Newman. 
“When this saving ($1,073) is offset against the average cost of moving home ($1,618), home buyers can effectively recoup quite a significant proportion of the cash spent on moving fees.” 
Newman’s top three tips for saving costs on moving homes are: 
<ol>
<li>DIY – Save on the cost of moving home by doing it yourself. The average cost of moving independently is $624, compared to the cost of having a removalist do everything – that’s pack, move and unpack – which comes in at an average cost of $3,655. 
</li>
<li>Consider switching your home loan to recoup expenses – Aussies who switched their mortgage in the last two years have, on average, saved more than $1,000. If you have a home loan, it is worth considering your options.  
</li>
<li>Have a garage sale – Moving presents the perfect opportunity to spring clean your belongings. Organise a garage sale to sell any unwanted items before you move, reducing the amount of items to be packed, as well as offering the chance to recoup some cash ahead of those unexpected moving costs.</li>
</ol>
The research was conducted by Galaxy Research on behalf of ING in September 2017 with an online permission-based panel.  
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Aussie home buyers spend an average $1,618 on relocation: ING  

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A two-level Victorian offering with potential for further development in Richmond on Melbourne CBD’s eastern fringe is set to go under the hammer on November 1 with price expectations of more than $2.25 million.
Located at <a href="https://www.realcommercial.com.au/property-offices-vic-richmond-502581762" target="_blank">121 Burnley Street</a>, the property boasts an address in one of Melbourne’s most popular restaurant, fashion and entertainment precincts.
The building includes a reception area, conference room, eight individual offices, kitchen facilities and toilets on the ground floor, and a large boardroom, kitchen, balcony and three individual offices upstairs.
The 439 sqm site, zoned Industrial 3, has frontage to Burnley Street and rear access via North Street.
The marketing is by Teska Carson’s Luke Bisset and Michael Taylor along with Jeffrey Richardson of Richardson French.
According to the agents, the property will be offered with vacant possession and provides an opportunity to invest in arguably Melbourne’s premier inner-eastern property market. 
Bisset said the area had benefitted from a number of high profile residential and commercial developments, driven by population growth and the attraction of Richmond’s well documented retail and entertainment offerings, as well as its proximity to the CBD.
“It is ideally suited to an investor or owner-occupier seeking a well-presented commercial property in a great location with the benefit of the potential for further development (STCA) and the prospect of capital growth,’’ Bisset said.
Strong enquiry is expected for the property.
“Property in this precinct is very popular with investors and that popularity has intensified in recent times as the purchaser market has expanded to include SMSFs and foreign investors as well as the traditional smaller investor. And of course owner-occupiers have been much more prominent due to the favorable borrowing rates,” Richardson said.
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Victorian building in Richmond set for auction with $2.25 million expectations

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Doing something about improving housing affordability, particularly for people on low and moderate incomes, is difficult for Australian politicians. The core of the problem is simple: until those trying to buy a home outnumber those who own one, governments will not adopt policies to bring down house prices. As John Howard once observed, no-one came up to him complaining their house price had increased.
Given the public anxiety about the issue, particularly among young people, governments are showing renewed interests in doing something about housing affordability. So what sort of government interventions are effective? <a href="https://www.propertyobserver.com.au/https://www.ahuri.edu.au/research/final-reports/289">A new report</a> from the Australian Housing and Urban Research Institute (AHURI), released today, explores these issues state by state. And some are clearly doing better than others.
<h2>What have governments been doing?</h2>
In the last six months governments at all levels have released housing affordability plans. The Victorian government released a <a href="https://www.vic.gov.au/affordablehousing/about">broad proposal</a> with interventions <a href="https://theconversation.com/what-a-difference-a-month-makes-but-victoria-can-still-do-more-to-get-housing-and-planning-right-74233" target="_blank">across the housing continuum</a> (see figure 1).
<img src="https://images.theconversation.com/files/188495/original/file-20171003-3124-hqtdt8.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt="">Figure 1: A housing continuum. Author provided
The state with the largest housing affordability problem, New South Wales, released a package of measures <a href="https://www.nsw.gov.au/improving-nsw/projects-and-initiatives/first-home-buyers/" target="_blank">in June this year</a>. The cornerstone of the plan is a reduction in stamp duty charges for first home buyers and increasing availability of some grants for the same group.
Most economists agree that these measures are likely to put <a href="https://www.domain.com.au/news/prices-will-rise-for-victorian-firsthome-buyers-following-stamp-duty-cut-experts-say-20170630-gx048c/" target="_blank">upward pressure on prices</a> as first home buyers compete in the property market with more dollars. However, politicians seem to like these sort of measures because they are <a href="https://politicsir.cass.anu.edu.au/content/attitudes-housing-affordability" target="_blank">popular with voters</a>.
The NSW plan also focused on increasing housing supply through changes to the planning system and accelerated provision of infrastructure. The headline goal used to measure the results of the package is an increase in the number of <a href="https://www.nsw.gov.au/improving-nsw/premiers-priorities/" target="_blank">dwelling completions to 61,000 per year</a>.
What’s unusual about this target is that there is no indication of the intended price levels of completed dwellings. Left to the market, the supply will not reach those most in need.
<a href="https://www.propertyobserver.com.au/https://www.ahuri.edu.au/research/final-reports/281" target="_blank">A recent AHURI study</a> found focusing only on supply as a strategy to reduce housing prices was a blunt instrument. The study reported:
<blockquote>
Most of the growth in housing supply has been taking place in mid-to-high price segments, rather than low price segments. There seems to be structural impediments to the trickle-down of new housing supply.
</blockquote>
<a href="https://www.propertyobserver.com.au/https://www.ahuri.edu.au/research/final-reports/281" target="_blank">The same study</a> concluded:
<blockquote>
Targeted government intervention might be needed in order to ensure an adequate supply of affordable housing.
</blockquote>
<h2>How do the states compare?</h2>
Drawing on the new research, Table 1 compares established state and territory schemes designed to deliver affordable housing.
It’s clear some states and territories, by adopting a multi-pronged approach, have been more active and innovative than others.
<a href="https://images.theconversation.com/files/188496/original/file-20171003-14213-1hz3j42.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/188496/original/file-20171003-14213-1hz3j42.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a> Table 1: Established state-level affordable housing programs (excluding the planning system). <a class="source" href="https://www.propertyobserver.com.au/https://www.ahuri.edu.au/research/final-reports/289" target="_blank">https://www.ahuri.edu.au/research/final-reports/289</a>, Author provided
The research focused on a review of state-level affordable housing delivery. To identify what sort of conditions maximised the chances of success, this included an evaluation of two effective strategies – one in the <a href="https://www.planning.act.gov.au/topics/affordable_housing/affordable_housing_action_plan">Australian Capital Territory</a> and the other in <a href="https://www.openingdoorswa.com.au/">Western Australia</a>.
Both strategies delivered thousands of dwellings for households in need of affordable housing across the continuum. Both have clear targets.
<h2>What are the secrets of success?</h2>
Strong and sustained leadership is critical to both the implementation and ongoing delivery of an affordable housing strategy. Leadership is required both within the organisation responsible for the strategy, ideally a single entity, but also at a political level, ensuring a whole-of-government approach.
Both the ACT and WA strategies had the support of the treasurer during development. This ensured implementation was not hamstrung by a lack of resources.
A strategy needs to be resilient; it should not be easy to roll back following a change of government. It also needs to be developed in close consultation with the private sector and relevant areas of government to ensure all stakeholders are on board.
The organisation implementing the strategy needs to be flexible and innovative. This includes taking advantage of poor housing market conditions to develop joint ventures with the private sector.
When unexpected funding sources arise, state government needs to take advantage by using funding to leverage additional outcomes.
These established strategies offer several lessons for a state government seeking to implement an affordable housing strategy.
<img src="https://images.theconversation.com/files/189124/original/file-20171006-25775-1mz5y3s.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt="">The WA government has worked with private sector joint ventures to expand the stock of affordable housing. Richard Wainwright/AAP
<h2>Land release is a key factor</h2>
Governments have focused on a broad goal of <a href="https://theconversation.com/solutions-beyond-supply-to-the-housing-affordability-problem-67536" target="_blank">increasing supply</a> as an affordable housing solution, (<a href="https://www.nsw.gov.au/improving-nsw/projects-and-initiatives/first-home-buyers/" target="_blank">such as the NSW strategy</a>).
In most cases this is a blunt tool because the government cannot directly influence the amount of land or housing stock made available (which are private sector decisions) or the price at which it is released onto the market.
States with an effective government land agency have an advantage. Land release then becomes an important part of an affordable housing strategy.
The ACT has been able to increase land supply and also to target the supply at a particular price point. WA has used its land effectively within private sector joint ventures to secure affordable housing.
Being able to guarantee increased land supply (and not just planning approvals for land development) as well as the price points of that land is a very powerful tool for a government trying to deliver affordable housing.
<h2>An effective affordable housing strategy</h2>
An effective affordable housing strategy is essential to deliver a range of supply options. At present, blockages along the housing continuum prevent households exiting social housing, which would free up supply for households in greater need.
WA in particular has demonstrated a successful strategy. Having reached its target of 20,000 dwellings <a href="https://www.housing.wa.gov.au/News/Pages/20000-affordable-homes-target-met.aspx" target="_blank">five years early</a>, the government committed to a further 10,000 homes <a href="https://www.propertyobserver.com.au/https://www.abc.net.au/news/2015-07-14/more-affordable-housing-to-be-built-in-wa-after-target-met/6618328">by 2020</a>.
<img src="https://counter.theconversation.com/content/84508/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1">Other states in the early stages of strategy implementation could learn much from the multi-pronged approach in the West.
<a href="https://theconversation.com/profiles/steven-rowley-201914" target="_blank">Steven Rowley</a>, Director, Australian Housing and Urban Research Institute, Curtin Research Centre, <a href="https://theconversation.com/institutions/curtin-university-873" target="_blank">Curtin University</a> and <a href="https://theconversation.com/profiles/peter-phibbs-27130" target="_blank">Peter Phibbs</a>, Chair of Urban Planning and Policy, <a href="https://theconversation.com/institutions/university-of-sydney-841" target="_blank">University of Sydney</a>
This article was originally published on <a href="https://theconversation.com" target="_blank">The Conversation</a>. Read the <a href="https://theconversation.com/some-states-do-better-than-others-on-affordable-housing-we-can-learn-from-the-successes-84508" target="_blank">original article</a>.
<h1>
The Living Space development in Cockburn, Western Australia, has won praise as an innovative mixed-use social housing project. <a class="source" href="https://www.hhawa.com.au/featured-projects/cockburn-central/" target="_blank">Courtesy of HHA Projects</a> <a href="https://theconversation.com/profiles/steven-rowley-201914" target="_blank">Steven Rowley</a>, <a href="https://theconversation.com/institutions/curtin-university-873" target="_blank">Curtin University</a> and <a href="https://theconversation.com/profiles/peter-phibbs-27130">Peter Phibbs</a>, <a href="https://theconversation.com/institutions/university-of-sydney-841" target="_blank">University of Sydney</a>
</h1>
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Some states do better than others on affordable housing – we can learn from the successes

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Leading fund manager Platinum Asset Management’s CEO is betting big on China, in spite of recent warnings from credit rating agencies.
Kerr Neilson, the chief executive and founder of Platinum Asset Management, has four times more money invested in China than the United States as he thinks country’s debt problems would impact the economy but not “stop it dead".
Platinum has invested more than a quarter of its $23.9 billion funds under management into China-related stocks.
"China is very much like the '60s and '70s in America when it had a can-do attitude and there was a lot of money going into investments and they led the world in many industries," Neilson was quoted by The Australian Financial Review as saying.
He has ignored recent downgrades from credit rating agencies and warnings about the growing risk of a banking crisis.
The veteran fund manager's bet on China helped his flagship Platinum International Share fund return 18 per cent net of fees over the past year, compared with 11 per cent for the index.
Since its inception 22 years ago, the fund has returned 12.8 per cent annually, around double the benchmark.
Neilson explained his rationale for investing heavily in China, citing the stable macro-economic outlook, a more profitable industrial sector and an unreliable stockmarket, which often leads to companies being mispriced.
"The locals, who account for 70 per cent of the volumes, tend to be much attracted to shiny new things," he said. "They will pay huge prices for what we regard as transient growth or overpay for the growth they are buying.
“We have been bewildered by the number of quite wonderful companies which we can buy quite cheaply," he added.
Platinum is focussing on companies in more traditional sectors with cheaper offerings and reduced its exposure to internet giants such as Alibaba, Tencent and Baidu
Neilson believes there is more value to invest in companies such as gas distributor ENN, which Platinum expects will grow at more than 15 per cent over the next few years as China moves towards cleaner energy.
It has also bought into Hong Kong-listed Anta Sports, which has doubled in price over the past 18 months.
Despite the rally, Neilson said it was "not an expensive stock given its exposure to the rising spending power of the Chinese consumer".
Platinum has about $6.5 billion invested in Chinese companies, either listed on the mainland, in Hong Kong or on markets around the world such as New York, compared with $1.5 billion in US stocks.
Platinum's strategy goes against conventional stock market wisdom. The US market has a 54 per cent weighting in the MSCI, the benchmark global index, to just around 6 per cent for greater China markets.
"In terms of its economic significance, that's pitiful," he said.
Neilson justified his choice saying China makes twice as many automobiles as the US and eight times as much steel and also leads the world in science, technology, engineering and mathematics graduates, with 4.7 million last year. That compared to 2.6 million for India and just over half a million each for the US and Russia.
He is also confident in the country's macro-economic outlook, a confidence that many others don't share.
In September, Standard &amp; Poor's followed the two other major ratings agencies in downgrading China's sovereign debt, citing a sustained period of credit growth, which had increased "financial and economic risks" on the mainland.
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Kerr Neilson, Platinum Asset Management boss bets on China for financial returns

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Brisbane is at the 11th spot among global cities for the most office floor space that can be bought for US$100 million, fetching 14,607 sqm in the CBD area but this could change as the leasing market recovers and prices head north, says a new report by Knight Frank.
The report, Global Cities 2018, compares how much USD100 million will buy of prime office space in 34 top cities across the world. 
Melbourne and Sydney sit at 15th and 23rd on the list respectively, with Melbourne fetching 12,719 sqm of CBD office space for USD100 million while the same money can get you 7,087 sqm in Sydney.
Knight Frank’s managing director, Queensland, Ben McGrath said that investor interest has continued to build in the Brisbane CBD market due to the Sydney and Melbourne CBDs recording lower yields and a climate of fewer opportunities. 
Brisbane’s office leasing market is recovering, creating limited time to purchase office assets to fully benefit from the expected recovery in tenant demand, according to Knight Frank’s latest research.
“The certainty that the leasing market has bottomed in the Brisbane CBD is providing impetus to the investment market with the view that now is the time to purchase assets to fully benefit from the expected recovery in tenant demand,” said McGrath.
“Additionally, the demand from large tenants for new space will provide the opportunity to secure core investments with limited national supply of these assets.”
Investment demand is also rising because of continued high spread in yields Brisbane has with Sydney and Melbourne, added Knight Frank’s joint head of Institutional Sales, Australia, Ben Schubert.
According to the Global Cities report, Brisbane’s prime office yields sit at 28th in the world out of the 34 cities monitored, with yields at 6.38%, while Sydney and Melbourne are at 20th and 22nd respectively with Sydney yields at 5.06% and Melbourne yields at 5.25%. 
“While both Sydney and Melbourne CBDs are far further through the leasing demand cycle, with signs of improvement in the Brisbane market, investment interest has further increased. Yields remain under downward pressure with interest in the Brisbane market continuing to build. Both the yield gap to Sydney and Melbourne and positive signs in the Brisbane leasing market is underpinning this investment interest,” said Schubert.
Knight Frank’s head of Commercial Sales, Australia Paul Henley said, “Investors are increasingly expanding their global portfolios. Those cities going through an evolution driven by a compelling mix of education, lifestyle, infrastructure, technology and real estate makes them places where people want to work, shop, play, and live.”
Knight Frank’s director, Research, Australia Michelle Ciesielski said prime yields have continued to firm in the Brisbane CBD, having fallen to a median range of 5.8% to 6.95% as demand grows.
“In Sydney, the strong investor demand, particularly from offshore investors, is putting significant pressure on yields across the grades, but more so on secondary assets which have a lower price point,” she said.
She cited the sale of 20 Bridge Street on a sub-5% core market yield as an indicator that prime assets in the CBD core are expected to be traded between 4.5% and 5.25%. 
“This will be further affirmed when the sale of Wynyard Place is concluded, with market expectation for a yield of close to 4.7%,” said Ciesielski.
In Melbourne, fewer buying opportunities with strong investor demand, particularly by offshore investors, has further compressed prime yields, added Henley. 
“Looking ahead, investment volumes are anticipated to remain above the five-year average in 2017. This is unlikely to match volumes recorded in 2014 as impacted by the scarcity of investment opportunities rather than diminishing investor appetite,” concluded Henley.
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Brisbane CBD ranks 11th globally for value in prime office space: Knight Frank

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Investors are positive about the long-term returns of Australian residential property, shrugging off concerns about stricter lending conditions, price bubbles and oversupply, a new survey has found.
More than 70% of the 742 respondents think now is a good time to invest in property, with 61% looking to purchase a property in the next six to 12 months (up from 58% last year), according to the third annual Property Investment Professionals of Australia (PIPA) Property Investor Sentiment Survey.
Surprisingly, Brisbane was at the top destination for property investors in spite of its apartment oversupply concerns, though the percentage who favoured the city fell from the last survey.
PIPA chair Ben Kingsley said that the survey results confirm that investors remain committed to property as a favourable investment option over the long-term.  
<a href="https://www.propertyobserver.com.au/images/2017/09/28/PIPA1.png" target="_blank">Click to enlarge</a>
<img src="https://www.urban.com.au/images/2017/09/28/PIPA1.png" alt="">
However, concerns over changes to investor lending policies loom large, with 43% of respondents reporting an adverse impact in their ability to secure finance, compared to 32% in 2016.  
Banks raising rates for interest-only loans was also a key concern, though more than half (55%) with interest-only loans said they would not struggle to meet new principal and interest repayments.
Higher borrowing costs also mean that investors are constantly looking for a better deal. 
More than 23% said they would consider refinancing their loan for an interest rate differential of 0.5 percentage points, while another 23% would consider refinancing for one percentage point.
According to the survey, only 15% of investors have put their buying plans on hold due to concerns around a property price "bubble". 
“Similar to last year, most property investors are looking past short-term challenges and are remaining focused on the long-term wealth benefits that are available from residential real estate,” said Kingsley.
Investors have also shrugged off speculation about negative gearing and capital gains tax changes, with only 14% putting their investment plans on hold.
The survey also shows that only half (52%) of property investors are currently negatively geared, with a majority (62%) of these expecting to become positively geared within five years. 
“The survey also affirms that a lot of the speculation about negative gearing misses the mark. Most investors understand that negative gearing is only a short-term cash flow position, not a property investment strategy. And only a very small minority are attracted to real estate for these tax concessions,” Kingsley said.
<a href="https://www.propertyobserver.com.au/images/2017/09/28/PIPA2.png" target="_blank">Click to enlarge</a>
<img src="https://www.urban.com.au/images/2017/09/28/PIPA2.png" alt="">
Despite being the most preferred destination for property investors, Brisbane has lost some appeal, with the proportion of investors favouring it falling from 49% to 43% over the past year. However, the city remains far ahead of any other capital city when it comes to investor interest. 
After Brisbane, Melbourne is the second most popular investment destination (32%), followed by Sydney (7.8%), Adelaide (6.6%) and Perth (5.5%).
“Property investors are becoming savvier. Many of them continue to look outside of our biggest property markets of Sydney and Melbourne, which are coming close to the peak of their cycles,” said Kingsley.
“The two key reasons that Brisbane still attracts investors are affordability and the potential for attractive yields. Brisbane is investing in infrastructure to make the city more liveable and investors are betting on this.”
Although investors are becoming more sophisticated, with 33% having a set strategy for investing, they overwhelmingly (84%) consider that more investment education about the risks and potential benefits of investing in property is needed. Even higher numbers (90%) believe that the property investment industry should be regulated and licensed in the same way as many other professionals.
“Unlike financial planning and mortgage broking, the provision of property investment advice still remains unregulated. PIPA is committed to raising the professional standards of this industry and will continue to lobby the government to regulate property investment advice and educate investors to help them make informed investment decisions,” Kingsley said.
 
 
 
 
 
 
 
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Property investors confident on real estate returns despite despite pressures: PIPA survey

The residential transformation of St Kilda Road is set to continue into with more new apartment plans for the sought-after boulevard.

Wing Tai Asia has lodged plans for a major residential tower at 464-466 St Kilda Road, replacing the former VACC House with an 18-storey mixed-use development designed around a retained heritage podium and a sculpted contemporary tower.

The proposal, prepared under Victoria’s Significant Residential Development with Affordable Housing pathway, would deliver 325 apartments and ground-floor retail across the prominent 4,653 sqm boulevard site in Melbourne’s St Kilda Road North Precinct.

The project centres on the adaptive reuse of the site’s heritage-listed VACC Building, an eight-storey office designed by Bernard Evans that has occupied the address for decades. Planning documents state the development would involve “carefully dismantling and conserving off-site the original metal fabric of the podium visible from St Kilda Road,” before reinstating it as the defining frontage of the new scheme.

Above the restored podium, Wing Tai is proposing a curvilinear residential tower. The scheme includes 172 one-bedroom apartments, 63 two-bedroom apartments, 66 three-bedroom apartments, and 24 four-bedroom apartments, alongside two ground-floor food and beverage tenancies fronting St Kilda Road.

The tower has been designed with substantial articulation and variable setbacks to minimise perceived bulk and maintain view corridors along the boulevard. Urbis, which prepared the planning report, said the design “has been significantly articulated through a curvilinear design” with “an interplay with materials, façade expression and depth” to create visual separation and visual interest.

The proposal also includes 254 basement car spaces, landscaped pedestrian links connecting St Kilda Road and Queens Lane, and a biophilic landscape strategy featuring canopy trees, raised planters, cascading greenery and a glass oculus pool overlooking the eastern frontage.

Planning documents confirm the $270.1 million development will contribute 3 per cent of project costs to the Social Housing Growth Fund as part of the application process.

Wing Tai acquired the St Kilda Road property in 2018 alongside Abacus Property Group for $95.38 million, before later consolidating ownership of the site. The property previously served as the Victorian Automobile Chamber of Commerce headquarters for around 60 years.

The transformation of the St Kilda Rd boulevard is already beginning to materialise, with a number of high-profile projects recently completed, launched, or approaching launch as developers continue to back the long-term appeal of the precinct.

Among the most notable recent completions is Louise by Samuel Property Group, just off the strip on Queens Lane, the same pocket Hirsch &amp; Faigen recently launched The Queensbury. Mirvac is too on the same street with The Albertine, which is approaching completion.

Dexus recently secured approval for its slice of St Kilda Road, while Gurner also has approved plans for the precinct.

Joel Robinson

Wing Tai unveils 325-apartment St Kilda Road tower on former VACC House site

Malaysian developer <a href="https://www.apartments.com.au/developers/s-p-setia">SP Setia</a> is the latest to jump into St Leonards booming Transport Oriented Development precinct.

The developer, which has previously delivered Sapphire by the Gardens apartment development in Melbourne, identified the Atchison Street site in 2023. It filed a Scoping Report around 12 months ago, and now has revealed the designs for the new&nbsp;40-storey mixed-use tower.

The State Significant Development Application covers <a href="https://next-portal.urban.com.au/projects/14650/summary">20-22 Atchison Street</a>, a 1,374 sqm site positioned between St Leonards Station and the new Crows Nest Metro station.

Designed by <a href="https://www.apartments.com.au/architects/cox-architecture">COX Architecture</a>, the project would deliver 181 apartments, above a four-storey commercial podium, five basement levels, and new public domain works along Mitchell Street. The apartment mix comprises 35 one-bedroom apartments, 39 one-bedroom-plus-study apartments, 85 two-bedroom apartments, and 22 three-bedroom residences.

The proposal has been lodged as a shop-top housing development under the NSW Government’s TOD planning pathway, which allows increased density around key transport infrastructure. The site sits within the recently rezoned Crows Nest Accelerated TOD Precinct.

<img alt="First look: SP Setia targets St Leonards skyline with 40-storey TOD tower" data-entity-type="file" data-entity-uuid="b799673d-48e2-46b0-801a-0e33a9330100" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/atchinson%20site.png?VersionId=dPh0UfwfaHpbFL1R7H1cbZNbIW0CHbCC" />

SP Setia acquired the Atchison Street site as part of its continued expansion into the Australian apartment market. In comments made to City &amp; Country (The Edge Malaysia) in 2023, SP Setia President and CEO Datuk Choong Kai Wai described the acquisition as “a strategic move” aligned with the group’s post-pandemic market recovery strategy.

“Our target for this exceptional development is local and overseas buyers, including first-home buyers, downsizers and investors,” Choong said.

The tower has been designed as a slender vertical form rising from a mixed-use podium, with COX Architecture positioning the development as a response to the evolving St Leonards and Crows Nest skyline.

“The purpose of the project is to facilitate the delivery of high-quality housing at a strategically located site and deliver a built tower outcome that is consistent with the desired future character of St Leonards and aligns with the TOD controls,” the design report stated.

<img alt="First look: SP Setia targets St Leonards skyline with 40-storey TOD tower" data-entity-type="file" data-entity-uuid="b1a85eee-76f7-436c-a6da-73ba827b9b13" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/atchinson%20entry.png?VersionId=dA9jHGPMcm.dDbwk4QfxqWiY5bfh3UVt" />

The podium would incorporate retail uses fronting Atchison Street, commercial tenancies, landscaped communal areas, and pedestrian improvements along Mitchell Street. Vehicle access and loading would be consolidated via Atchison Lane.

Residents would have access to more than 665 sqm of communal indoor and outdoor spaces, while the development proposes 96 parking spaces across five basement levels.

The proposal also includes a commitment for 10 per cent of residential floor space to be allocated toward affordable housing through a monetary contribution.

COX said the tower form responds directly to the emerging high-density character of the precinct while seeking to maximise solar access, cross ventilation, and outlook from apartments.

<img alt="First look: SP Setia targets St Leonards skyline with 40-storey TOD tower" data-entity-type="file" data-entity-uuid="2163f85c-f63b-4be3-aafa-f8763976cec5" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Article%20Feature%20Image%20%28Grid%29_5.png?VersionId=WiAmtIKJ6.ZQ41EtYEQ1fol7AeorKBlL" />

“The building is orientated towards north,” the Apartment Design Guide compliance report noted, adding that the tower’s slim form was driven by the constrained inner-urban site dimensions.

The design also incorporates landscaped setbacks and communal open space at podium level, intended to soften the interface with surrounding streets and improve pedestrian amenity.

The project adds to a growing wave of redevelopment proposals reshaping St Leonards and Crows Nest following the opening of the Sydney Metro City line and the NSW Government’s push for higher-density housing around major transport nodes.

Last week Stockland filed plans just down the road. They want to build a <a href="https://www.apartments.com.au/new-apartments/601-pacific-highway-st-leonards-nsw-2065">52-storey tower on Pacific Highway</a>.

Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/first-look-stockland-plans-52-storey-538-apartment-st-leonards-tower">First look: Stockland plans 52-storey, 538-apartment St Leonards tower&nbsp;</a>

First look: SP Setia targets St Leonards skyline with 40-storey TOD tower

<a href="https://www.apartments.com.au/developers/urban-property-group">Urban Property Group</a> has revealed plans for a new mixed-use tower at 10 Dangar Street, Wickham, advancing a proposal that would reshape the southern gateway to Newcastle’s city centre with one of the city’s tallest residential buildings.

The State Significant Development proposal, now on exhibition, seeks approval for a <a href="https://www.apartments.com.au/new-apartments/bowline-10-dangar-street-wickham-nsw-2293">43-storey tower</a> immediately adjacent to the Newcastle Interchange. The project would deliver around 200 apartments, including 42 affordable housing dwellings, alongside 99 co-living units, a 171-room hotel, retail space, and new public domain integrated through the site.

The scheme marks a significant escalation of plans previously approved for the site. Urban Property Group took over the prominent 2,904 sqm parcel, where excavation and demolition had already commenced under an earlier consent for a 14-storey mixed-use development.

<img alt="First look: Urban Property Group unveils Newcastle’s next supertower at Wickham interchange" data-entity-type="file" data-entity-uuid="58a96dd9-407f-4d20-86b4-94e4bfeef74b" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/wickham%20podium.png?VersionId=LGlf08pdFGAZDzvx_CXC4XakHNZRuEE0" />

Designed by <a href="https://www.apartments.com.au/architects/sjb-architects">SJB</a>, the tower has been conceived as a landmark transit-oriented development anchored to the Newcastle Interchange precinct. The proposal includes 245 build-to-sell apartments across a mix of one, two, and three-bedroom residences, as well as two penthouses. Fifteen apartments and one operational unit are earmarked for NDIS housing. The co-living component would add a further 99 units, while the podium would accommodate retail uses and hotel facilities.

SJB said the site presents “a valuable opportunity to anchor the precinct by setting the standard for design, active ground planes and character at the key southern gateway.”

The architecture responds directly to the site’s position beside major transport infrastructure and within one of Newcastle’s fastest-evolving urban renewal precincts. The tower form sits above a sculpted podium designed to frame new public spaces, including a through-site pedestrian link connecting Station Street to Hannell Street, landscaped plazas, and activated retail edges.

<img alt="First look: Urban Property Group unveils Newcastle’s next supertower at Wickham interchange" data-entity-type="file" data-entity-uuid="a7bd6ff0-f7db-4ce8-a6dc-ea56e72c6149" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/wickham%20lanne.png?VersionId=xzf39VADyhj7zBQY2I9fx9vI62u2tuSb" />

The design report describes the project as part of the broader transition of Wickham into “a vibrant, high-quality mixed-use urban precinct” that leverages proximity to the station, open space, and regional connectivity.

A detailed public art strategy has also been prepared for the development. The strategy positions the project as “a transit-oriented development of state significance at the gateway to Newcastle’s city centre” and outlines a series of integrated artworks responding to Newcastle’s industrial and transport heritage.

Creative Road’s curatorial framework for the project, titled Unveil, draws on “stratified surfaces, carved volumes, and light-filled apertures” while referencing Newcastle’s transformation from an industrial city into a contemporary education and technology hub.

<img alt="First look: Urban Property Group unveils Newcastle’s next supertower at Wickham interchange" data-entity-type="file" data-entity-uuid="77a882bb-14b1-4d28-99ff-9438e39508c0" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/wickham%20site.png?VersionId=cevgo_vN0eKPK78P8YcEu3mKPLkpFqE7" />

The proposal is being advanced through the NSW Housing Delivery Authority pathway after being declared State Significant Development in June 2025. The accompanying scoping report states the development aims to “maximise the site’s proximity to the Newcastle Interchange by delivering transit-oriented development” while increasing housing supply and affordable housing provision within the Newcastle LGA.

Urban Property Group’s plans align with the long-term strategic vision established under the Wickham Master Plan, which identified the interchange precinct as suitable for substantial uplift in height and density. The current proposal would significantly intensify that vision, positioning the tower among the tallest developments proposed for Newcastle.

The site sits immediately north of the Newcastle Interchange, bounded by Dangar Street, Hannell Street, and Charles Street. It is surrounded by a rapidly growing cluster of residential towers and mixed-use projects that have emerged following the completion of the light rail and transport interchange.

First look: Urban Property Group unveils Newcastle’s latest tower at Wickham interchange

Bottega House has completed settlement of a landmark riverfront site in Macquarie Street, St Lucia, representing its first major Brisbane development.&nbsp;

Positioned on the banks of the Brisbane River, the <a href="https://www.apartments.com.au/new-apartments/180-macquarie-street-st-lucia-qld-4067">premium site at 180 Macquarie Street</a> features uninterrupted river frontage in one of Brisbane’s most tightly held residential precincts.&nbsp;

The proposed development, currently under assessment with Brisbane City Council, has been designed by <a href="https://www.apartments.com.au/architects/plus-studio">Plus Studio</a> with interiors by <a href="https://www.apartments.com.au/interior-designers/mim-design">Mim Design</a> and will deliver a boutique collection of premium residences positioned specifically for owner occupiers and downsizers.&nbsp;

The residences are set to redefine luxury apartment living in the area, with a focus on architectural quality, refined finishes, landscape integration and elevated amenities including curated wellness facilities, resort-style pools and recreation spaces rarely seen in the local market.&nbsp;

Exclusive sales for the project will be led by Keenan &amp; Byrne, ahead of an anticipated launch later this year.&nbsp;

Bottega House Managing Director Nick Malloch said the project reflects the group’s ambition to deliver a highly curated residential offering within one of Brisbane’s most tightly held precincts.&nbsp;

“This is an incredibly rare riverfront opportunity and one we have approached with a long-term perspective,” Malloch said.&nbsp;

“Our vision from the outset was to create a boutique collection of residences that feel more like private homes than traditional apartments, with generous proportions, refined finishes and exceptional amenity throughout."

Malloch says there is a&nbsp;lack of premium owner-occupier stock of this quality in the market, particularly for downsizers wanting space, privacy and a true lifestyle offering without compromise.&nbsp;

"Demand is expected to be strong given the scarcity of premium riverfront opportunities of this nature within Brisbane’s inner-west."&nbsp;

Bottega House secures landmark riverfront site in St Lucia 

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The arrival of the first piling rig officially marks the commencement of construction at SIERA’s new beachside apartment development, Exhale, in Northcliffe.

<a href="https://www.apartments.com.au/new-apartments/exhale-surfers-paradise-8-enderley-avenue-surfers-paradise-qld-4217">Exhale</a>, a glass-encased tower featuring 54 large-scale apartments at 8 Enderley Avenue, is SIERA’s third Gold Coast development. It follows the recently completed PIPIS Bilinga beachfront project, which achieved suburb-record prices, and the soon-to-be-completed Chevron Island development, Tapestry.

[smartcode_project:default project_id=112661 project_image_fid=359603]

<a href="https://www.apartments.com.au/developers/siera">SIERA</a> Founder and Managing Director Brent Thompson said the arrival of the piling rig represented a significant milestone for the development, which is scheduled for completion in late 2028.

Over the next month, around 260 piles are expected to be installed as work progresses on the basement structure. The building is anticipated to rise above ground level early next year, before unveiling its sculptural glass curtain wall, developed in collaboration with specialist façade engineers.

“The façade was designed to maximise panoramic coastal views while creating a distinctive architectural identity,” Thompson said.

[smartcode_project:default project_id=112661 project_image_fid=355935]

Designed by BDA Architecture, Exhale will comprise just 54 two- and three-bedroom residences across 26 levels, a level of low-density living rarely delivered in this beachside pocket between Surfers Paradise and Broadbeach.

The project has been conceived as a resident-only building, with no short-stay accommodation permitted. SIERA says the model is intended to appeal to long-term owner-occupiers rather than transient holiday demand.

[smartcode_project:default project_id=112661 project_image_fid=361052]

Residences have been designed with large-format layouts and expansive glazing, with most apartments featuring more than 30 metres of glass frontage to maximise natural light and ocean views.

The amenity offering spans two levels and centres on wellness and lifestyle, including a heated magnesium pool, sauna, yoga and Pilates studio, gymnasium, private dining facilities, cinema lounge, and dedicated surfcraft storage.

[smartcode_project:default project_id=112661 project_image_fid=359607]

More than half of the apartments have already sold. SIERA has also opened a sales gallery for Exhale at its Chevron Island commercial premises, near its Tapestry tower and the site of its second Chevron Island apartment development, which is slated to launch in early 2027.
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[smartcode_project_cta:default project_id=112661]

Prateek Chatterjee

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