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Confidence in Australia’s rural sector, and investor interest in rural property markets are starting to surge, as evidenced by the recent purchase of the historic Fossil Downs cattle station by mining magnate Gina Rinehart. It is likely that foreign investors, including from China, are not far behind.
Perversely, the ongoing reluctance of Australian equity and superannuation funds to take major investments in agriculture because it is seen as too risky means the benefits of the “beef boom” will not be shared as widely as they could have been.
Drought, demand and the dollar are the trifecta driving Australian beef prices higher. Cattle prices in Australia have surged since 2014, breaking through the 400 cents/kg threshold of the Eastern Young Cattle Index in January 2015 and the 500 point level in June. Some analysts are now predicting that the index will pass 600 points before the year end.
Beef is Australia’s second largest agricultural commodity, and prices are driven by supply and demand forces, both internationally and domestically. Essentially this is a story of two supply shocks that still take some time to wash through the beef supply chain.
The forces driving beef prices up
The first was the large drought in the United States in recent years that affected both pasture and corn production, resulting in the US cattle herd falling to its lowest level since the early 1950s and beef production falling to its lowest level since the early 1990s. The shortages of supply caused record beef prices in the US in 2014, which have increased further in 2015. The US is both a major importer and an exporter of beef, so the drought has pushed up global beef prices to record highs. The US also took more beef from Australia in 2014, up 84% on the previous year.
The effects took some time to be felt in Australia because of its own drought – the second supply shock. Major drought in 2013 and 2014, particularly in northern Australia, has seen a rapid turnoff of stock, increasing to nearly 10.5 million head for slaughter and live export in 2014, almost 2.5 million more than in either 2011 or 2012. Prices stayed low in 2014 because of the excess supply, while the Australian beef herd fell to its lowest level in two decades.
It takes between two and three years for cattle to grow to slaughter weight. When droughts break the dynamics of herd rebuilding mean that breeders hold females back to increase their breeding herd. This adds a fall in supply to the lag in production after a drought. These dynamics are now in play for both the US and Australian beef herds, and explain why supplies are now so tight as parts of each country recover from drought. In fact the Australian herd is expected to further decline in 2016 as a result of fewer calves coming into the system.
Of course, there are many other supply and demand forces at play in international markets. On the supply side there is limited ability of our key competitors to meet the supply gaps; for example while exports from Brazil are expected to increase in 2015, they have also been experiencing some supply tightening and record prices. On the demand side, our key markets such as Japan, South Korea and China remain strong, with the 2014 surge in demand from the US absorbing any additional supply Australia can produce.
The third part of the trifecta is the low Australian dollar, which essentially translates overseas demand into higher prices. The combination of higher global beef prices, short supply and a falling dollar underpin the surge in higher prices.
Beef prices will keep rising in shops
There are three key flow-on effects that are particularly worth noting. The first is that competition and substitution effects are going to affect domestic meat prices and consumption. Retail beef prices will continue to rise in Australia in 2015 and 2016 as a consequence of the market changes, and this will in turn reduce per-capita consumption of beef, particularly as consumers continue the shift to other protein sources.
The second is that higher incomes will flow into regional Australia, given the extent of the footprint that beef production has in the country, particularly in northern Australia where almost all of the agricultural land area is used for beef production (recognising that other commodities are more intensive). This is timely given the erosion in real incomes over the past decade; cattle prices in 2014 were almost unchanged from 15 years previously despite steadily increasing input costs.
The third is that higher incomes will provide the capital for farmers to invest in productivity improvements. Cattle production is becoming a sophisticated business with better genetics, new technology and improved infrastructure just some of the options to improve both productivity and total output. Improvements in real incomes will be followed by expenditure on supply inputs as producers catch up on maintenance and invest in efficiency gains.
How long higher prices will last is difficult to predict. Price spikes in agricultural commodities, like resources, are typically followed by supply increases after a lag period, so higher prices because of the recent droughts should not last beyond 2017. Yet demand drivers are also starting to emerge, underpinned by global population and wealth increases.
The most immediate effect will be through the new free trade agreements that will increase demand from our Asian partners. This means there is the potential for new demand drivers for Australian beef to replace the current supply shortages as the key factor underpinning higher beef prices.
John Rolfe is deputy dean of research, School of Business and Law at Central Queensland University and author for The Conversation. He can be contacted <a href="https://theconversation.com/profiles/john-rolfe-1894" target="_blank">here</a>.
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Rural purchasing confidence starting to surge

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A preliminary draft plan for a $160 million retail park in the Sydney suburb of Bankstown has been released, with the public invited to submit their ideas until October 21.
The Preliminary Draft Major Development Plan for the Bankstown Business Estate is designed to make best use of surplus aviation land around Bankstown Airport, some 41 hectares of Commonwealth-owned land.
LEDA Holdings managing director Robert Ell said the disused land is a perfect fit for such a proposal.
“The site has been earmarked for commercial use for a long time,” Mr Ell said.
“The project would also fill a commercial gap, attracting some of the world’s top retail names and providing affordable shopping opportunities for locals.
"The impact on local residents should be negligible because the site is buffered by Bankstown Airport’s runways, existing commercial operations, local golf courses and the Georges River."
$50 million of the proposed development has been slated for local infrastructure upgrades.
Potential retail development could include a discount factory outlet, bulky goods retail, warehousing, medical and fitness tenants and lifestyle and entertainment facilities such as alfresco cafes, restaurants, bowling lanes and play centres.
For more information, go to the Bankstown Business Estate website <a href="https://www.bankstownbusinessestate.com/the-site/" target="_blank">here</a>.
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Preliminary Bankstown Business Estate project draft released

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GUEST OBSERVER
Despite reaching new record levels for the year, building approvals are showing the first signs of having peaked according to the latest ABS data for June released today. 
The run of record approvals over the last financial year has created a pipeline of new housing construction activity at levels to finally meet Australia’s needs after years of underbuilding. 
Nationally the latest ABS Building Approvals were down 8.2% in June 2015 in comparison to the previous month’s figure. For the 12 months to June 2015 however the record-breaking run continued with 220,423 new dwellings approved in seasonally adjusted terms. This was up from 195,302 approvals for the same 12 month period to June 2014. 
The figures point to the market operating as it should and responding to new macroprudential settings with the reduction in approvals likely pegged to investor based activity. 
The good news here is that when we compare building approvals figures with household formation rates the two are lining up. 
The bad news is the signs are suggesting this may have peaked. On average 154,000 new homes are built per year, but this has been falling short by between 2,000 and 14,000 homes of what is required each year over the past 10 years, creating a housing shortfall. However the approvals we have seen over the last twelve months will start to make a dent in the housing deficit, especially in Sydney. 
With investment loans likely to be lower, the critical issue is to ensure as many approvals are converted to actual builds as possible to boost supply, especially in Sydney where pricing pressures have been predominantly due to undersupply. 
The danger is that measures to contain house price growth in Sydney and Melbourne mean new housing drops away in other states. These states have only just come back to moderate, long-term five-yearly average house price growth off the back of recent strong building activity. 
Declining investor numbers and new taxes on foreign investment will impact on the number of approvals that progress to construction. It is vital that strong supply is maintained to moderate housing prices particularly in Sydney and Melbourne. 
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Governments need to continue to focus on supply side efficiencies in land release, improvements to development assessment and reform of inefficient taxes such as stamp duty to support continued supply. 
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Nick Proud is executive director of residential for The Property Council of Australia and can be contacted <a href="https://www.propertyoz.com.au/Profiles/ProfileDetail.aspx?pid=75" target="_blank">here</a>.
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Record building approvals but figures moderating: Nick Proud

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The majority of potential property investors remain undeterred by APRA's recent changes in investment policy, according to new research by Mortgage Choice. 
54% of respondents to Mortgage Choice's 2015 Investor Survey plan to continue with their investment plans regardless of changes to investment lending policies.
Mortgage Choice chief executive office John Flavell said 70% of respondents believed now was still a good time to invest.
“While on average 54% of investors said the changes wouldn’t affect their investment plans, the story was a little different for Gen Y buyers,” Mr Flavell said.
“Baby boomers by comparison, were far less likely to be put off by the changes, with just 30% saying any changes would affect their property investment plans.
“Our data shows an increasing number of investors are actually Gen Y’s who are purchasing property for the first time. For many younger buyers, purchasing an investment property before an owner occupied property gives them the opportunity to purchase where they can afford while still living where they want."
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Investment changes fail to deter property investors: Mortgage Choice

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GUEST OBSERVER
The recent collapse in the Chinese share market was preceded by a boom – a boom that was, in turn, fuelled by relaxed restrictions on margin lending, and a growth in the shadow banking sector<a href="https://www.economist.com/node/21601872/">.</a> Both served as inducements for Chinese retail investors to borrow in order to invest in a rising stock market.
The central bank urged people to buy local stocks, cut interest rates, and reduced the required reserve ratio for banks to free up more funds for lending. What could go wrong!
Since late 2013, Chinese authorities have pursued a policy of further opening up the capital markets. The aim has been to “internationalise” the local currency, the yuan (renminbi or “people’s money”), and to link the local stock exchanges to international markets. A major milestone was reached when the Shanghai-Hong Kong Stock Connect (also known as the “Through Train”) was launched in November 2014. This scheme now allows Hong Kong investors to trade on the Shanghai Stock Exchange, and provides a channel for mainland capital into the Hong Kong Exchanges and Clearing (HKEx) - further increasing the internationalisation of Chinese outbound investment.
The Chinese share markets (China has two national bourses, one in Shanghai and one in Shenzhen) are dominated by retail investment, and its 90 million retail investors have fuelled much of the growth.
Given the youth of the Chinese markets (born in 1990), Chinese retail investors are, by definition, inexperienced and prone, like any adolescent, to bouts of exuberance. Along with the <a href="https://www.kpmg.com/cn/en/IssuesAndInsights/ArticlesPublications/Documents/China-Capital-Markets-FTSE-201106.pdf" target="_blank">stock market boom</a>, even more rapid rises in the value of the two exchanges have been driven by government measures aimed at encouraging money out of the over-heated property markets and into corporate equity<a href="https://www.dailyreckoning.com.au/chinas-stock-market-valuation-grew-by-6-5-trillion-in-just-12-months-cw/2015/06/09/">.</a>
The property bubble which has hit many Chinese cities has been worrying the authorities since at least 2010, and efforts have been made to crack down on property speculation and investment-driven demand. Home purchase restrictions where first put into place in 2010, and in March 2013 Beijing called for stricter enforcement of a 20% capital gains tax on home sale profits. It also asked cities with fast property price increases to raise the down payment requiremen<a href="https://www.propertyobserver.com.au/https://www.cnbc.com/id/100516350">t</a> and mortgage rate on second homes.
Damping down the property market is one part of China’s longer-term strategy to move away from its old model of high and increasing levels of investment, especially in industrial activity and urban infrastructure. The new model is based on lower investment, more subdued (more sustainable) growth and higher domestic consumption more in line with shifting national priorities towards improving the quality of air, water and living standards for more Chinese people.
By June last year analysts were warning that investor confidence in the domestic Chinese A-share market (A-shares are denominated in renminbi, B-shares in foreign currency) had been “weak for quite some time”. So when the Chinese banking authorities cracked down on margin lending in June, and the banks began to call in their margin loans, already fragile investor confidence collapsed quickly - and the market fell with it. Those falls continued this week, despite moves by Chinese authorities to restore confidence.
The Chinese authorities have reacted instinctively – the same way that authoritarian regimes everywhere react. They sought to rectify. Rectification in this case has been very restrained by Chinese standards, but even restrained intervention has meant the introduction of a slew of measures aimed at halting the free fall and stabilising the market. These have included temporary halts on trading on over half of all China-listed stocks, a six-month ban on major shareholders selling listed stocks, postponement of approved new listings (IPOs - initial public offerings) and suspension of new IPO approvals.
The Ministry of Public Security began investigations into <a href="https://www.scmp.com/news/china/policies-politics/article/1838247/chinese-police-find-signs-illegal-share-trading">“</a>malicious short selling” and some “suspicious foreign banks” (even the global market index provider MSCI was blame<a href="https://www.scmp.com/comment/insight-opinion/article/1838214/msci-joins-list-reasons-china-market-crash">d</a> for the market crash).
The authorities also ordered major brokerages to increase their investments and further cut interest rates. The People’s Bank of China even announced it would provide liquidity support to the China Security Finance Corporation, which oversees the margin financing of brokers.
<h2>Irrational exuberance</h2>
As Robert Shiller explained in 2000, well before the global financial crisis, all markets experience periods of irrational exuberance. Nor should it surprise anyone that a market as young and uneducated as the Chinese market should be more volatile that most.
The real question now is what effect recent stock market volatility will have on the “real” Chinese economy. The first point here is that the Chinese stock index is not closely linked with the macro economy and is not an indicator for economic trends. Second, most financing does not come from the stock market, but from bank loans. Of <a href="https://cityoflondon.gov.uk/business/economic-research-and-information/research-publications/Documents/Research-2015/Chinas_capital_markets.pdf" target="_blank">total social financing</a> in 2014, only 2.6% came from the stock market, while bank loans accounted for 59%.
As the Chinese share markets stabilise around a new lower level, if the money lost from the market goes into real consumption, that could potentially even be good for the economy.
If money lost from the markets simply vaporises in the form of bad loans, gambling losses and corrupt payments, then that will be a significant loss, but one which an economy the size of China’s can bear. The net result, as often occurs with such events, will probably be a transfer of wealth from ordinary Chinese to the wealthy, including many major shareholders who have cashed out.
Ambitious plans for full yuan convertibility under the capital account will probably be delayed as the Chinese authorities become more cautious in their approach. In the longer term, the Chinese authorities, at the very least, will need to establish clearer measures for risk evaluation and responsibility, and begin to educate retail investors. 
Alice de Jonge is senior lecturer, International Law; Asian Business Law at Monash University and an author for The Conversation. She can be contacted <a href="https://theconversation.com/profiles/alice-de-jonge-118840" target="_blank">here</a>.
 
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China’s market lesson will be one of wealth transfer

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<div class="column">Westpac Economics research for July has found housing sentiment falling to the first sub-100 level since June 2010.</div>
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Respondents to the monthly Red Book survey question on whether or not now was the time to buy fell 15.4% to 94.8. 
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<div class="column">The report, however did note 5-8ppts of the July fall may be seasonal.</div>
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<div class="column">Allowing for a seasonal adjustments, the index reading of 94.8 is well under the average of 125.</div>
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<div class="column">The survey found states with a weak buyer sentiment and strong price outlook are Victoria and New South Wales, weak sentiment and weak price outlook in Western Australia and strong sentiment and strong price outlook in Queensland and South Australia.</div>
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Time to buy - national housing sentiment falling: Westpac Economics

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GUEST OBSERVATION
Behavioural economics is a revolutionary field. Its champions may not have beheaded any royalty, but they have done the academic equivalent by overthrowing a paradigm that ruled our thinking and shaped our institutions.
Behavioural economists have shown that the hyper-rational, self-interested agents of standard economics are mythical creatures. Real-world people are irrational, struggle to exert control over their emotions and impulses, and are social animals with a fondness for fairness.
This paradigm shift radically changes how we think about behaviour, and it seems poised to change our institutions. But how much change will it bring?
Will the influence of behavioural economics on policy be limited to improving the wording of parking fines sent out to misbehaving motorists? Or can it also help us institute bold, sweeping reforms of the type that have helped make Australia equitable and prosperous?
The answer is: it depends.
The policy impact of behaviour economics will be limited – and may even be harmful – if public servants focus excessively on the behavioural revolution’s most famous offspring, <a href="https://www.youtube.com/watch?v=pDub6gG1yxw" target="_blank">the policymaking approach called “nudge”</a>.
On the bright side, the focus on nudge is artificial. It does not flow from the evidence. Some of the most important regulatory reforms in Australia’s history could have been justified using behavioural economics – and such opportunities for reform will emerge again in the future.
<h2>The birth of the nudge</h2>
The “nudge” policy approach took the United States and United Kingdom by storm in 2008, when Cass Sunstein and Richard Thaler released their groundbreaking work, <a href="https://yalepress.yale.edu/book.asp?isbn=9780300122237" target="_blank">Nudge</a>.
In the psychological weaknesses uncovered by behavioural economists, Sunstein and Thaler saw opportunity. They argued we can exploit cognitive biases to nudge, or gently guide, people into making choices that are better for them and for the rest of us too — while always leaving them free to choose otherwise.
Want people to sign up for organ donations? Then harness their tendency to procrastinate, by switching from a system where they must choose to opt-in to one where they must choose to opt-out.
Want people to use less electricity? Then exploit social norms by showing them how little their energy-efficient neighbours pay for electricity.
Want people to avoid payday loans? Then make the loans’ downsides salient, by directly comparing their enormous interest rates with other borrowing options.
<h2>Confusing nudges with behavioural economics</h2>
Nudges may have grown out of behavioural economics, but evidence from that very field suggests that they often fail to meet the hype. Nudges designed to discourage people from taking out ludicrously expensive payday loans, for example, tend to be toothless in practice.
In a new policy brief at the Melbourne Institute, <a href="https://www.melbourneinstitute.com/downloads/policy_briefs_series/pb2015n04.pdf" target="_blank">The Potential of Behavioural Economics: Beyond the Nudge</a> I examine what behavioural economics tells us about the promise of both nudges and tools beyond them.
There is, right under our noses, an unnoticed world of behavioural evidence showing that traditional policy tools — like taxes, transfers and mandates — are in many cases superior to nudges.
Rather than throwing out the baby with the bathwater, behavioural economics suggests we should take a fresh look at how we might use traditional policy tools to counter cognitive biases.
<h2>A nudge bias</h2>
Why has the behavioural evidence on traditional tools been so overlooked? The reasons are largely political.
Nudge was written for a US audience, in a political climate shaped by the anti-paternalistic sentiment that would later coalesce into the Tea Party.
It has become tough, in this context, to pursue rational and equitable reforms of the traditional variety. Government is seen less as the tool the people use to democratically shape the society they want, and more as a suspicious intruder interfering with the benevolent market.
Sunstein and Thaler promoted nudges specifically because they promised a “middle way”: they influenced choices without coercing choice.
This justification turns out to be fanciful. In practice, many non-coercive nudges are too weak to provide serious benefits, and making a nudge effective often means making it coercive.
Take the nudge “success” story of the Save More Tomorrow scheme, designed to counter the strong biases that affect retirement savings decisions. Its central innovation is the automatic escalation of the savings rate over time, so people sign up to save more in future years without losing a dime today.
Though certainly a clever nudge, in practice it <a href="https://www.sco.ca.gov/Files-EO/2013_sco_flac_benartzi_behavioural_econ_and_savings_crises.pdf" target="_blank">increased the national US savings rate by a paltry 0.33%</a>, which will barely make a dent in the enormous problem of old age poverty. Australia’s superannuation scheme leaves it in the dust, with more than twenty times the impact.
Making Save More Tomorrow effective would require increasing its coerciveness — making it compulsory for workplaces to make it the default for all employees, with a much higher default increase in the rate of savings, and a penalty for opting-out — so that it essentially becomes a mandate.
Even then, as I will touch on below, behavioural economics suggests the opt-out would make the scheme welfare-reducing compared to superannuation.
Another example is the host of nudges applied to cigarettes. We plaster packages with gore and health warnings, and we exile smokers to the cold streets where they puff away under scowls and social stigma.
People can still choose to smoke, but this regime of tough nudges is hardly non-coercive. In fact, it is effective precisely because it imposes high costs on smokers.
The point is that nudges are much like traditional tools after all: they are subject to the same trade-offs between agency and welfare.
<h2>Behavioural economics for traditional tools</h2>
Sunstein and Thaler hoped to make peace between the United States’ warring tribes of progressives and libertarians, and this is precisely how we should understand nudges: they are a political innovation, only sometimes justified by the evidence.
What does the evidence say in full? Behavioural economics has comprehensively falsified rational choice economics. We make serious mistakes, and companies know it.
It would be paradoxical if, after rational choice has been so comprehensively discredited, policymakers responded by relying more on choice-preserving tools like nudges.
Consider the policies that make Australia prosperous and equitable, like publicly-funded universities, superannuation, and financial product regulation. Perversely, the nudge philosophy would reject these as too interventionist.
A more complete behavioural economics only strengthens the case for such policy. Take retirement savings: behavioural economics tells us that people tend to be present-biased, and they succumb to the temptation to withdraw early. One solution is to penalise early withdrawals.
The US Internal Revenue Service, for example, imposes a 10% penalty on early withdrawals — but even so, for every US$1 invested, US$0.40 is withdrawn early, at great cost.
How big should the penalty be? A behavioural savings model including the effects of present bias suggests that a <a href="https://eml.berkeley.edu/~webfac/seminars/Optimal_Illiquidity_2014.pdf" target="_blank">100% penalty would maximise welfare</a>, because it would stop all early withdrawals even for the most present-biased individuals.
In other words, Australia’s superannuation mandate is optimal. Savings should be made fully illiquid, with no opt-out. The mandate imposes small costs on the few who would have withdrawn rationally, but these costs are dwarfed by the vast welfare gains overall.
Cash transfers too can be reevaluated under the behavioural lens. Research explored in Mullainathan &amp; Shafir’s <a href="https://us.macmillan.com/scarcity/sendhilmullainathan">Scarcity</a> (2013) demonstrates that poverty causes IQ to plummet, because dealing with the everyday challenge of being poor takes up so much cognitive bandwidth.
The corollary is that when impoverished Indian farmers receive a cash infusion, they experience a massive boost in IQ.
The behavioural evidence suggests that poverty may be cyclic partly because it is so tough to make good decisions while in poverty. Cash transfers free cognitive resources to focus on longer-term problems like learning, finding work, and planning for the future.
<h2>A way forward</h2>
How should policymakers proceed? They should remain agnostic when choosing between nudges and more traditional policy tools.
The right tool will raise welfare as much as possible, without stopping people from making cherished decisions about their lives. The litmus test will be democratic: do people accept the policy or not?
Superannuation, notably, passes the test with flying colours — it curtails choice, but it creates such large benefits that it enjoys enormous levels of support (<a href="https://www.aist.asn.au/media/128974/2012.03.19%20essential%20media%20poll.pdf" target="_blank">only 7% of people polled were against</a> the increase in super from 9% to 12% of income).
It does not curtail a cherished choice, like what job we can take, where we can live, what we can learn, or who we can associate with. It helps most of us do what we already want to do, but struggle to do.
Nudges will play a valuable, complementary role to traditional tools. The science, however, reasserts that there is no easy middle road.
We must continue to democratically debate big ideas about the kind of society we want to build — and we should always build it upon the firm ground of evidence.
Reuben Finighan is senior research officer at The Melbourne Institute, Fellow of the ARC Life Course Centre of Excellence at University of Melbourne and author on The Conversation. He can be contacted <a href="https://theconversation.com/profiles/reuben-finighan-157147" target="_blank">here</a>.
 
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The potential of behavioural economics: beyond the nudge

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Need to find out if you are eligible for a one-off grant under the national First Home Owner Grant Scheme?
All Australian states and territories administer the grants. To see if you are eligible, click on the links below the correspond to the state or territory you are looking to purchase in.
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New South Wales State Government
<a href="https://www.osr.nsw.gov.au/grants" target="_blank"><img src="/images/2015/07/28/nsw.jpg" alt="" width="200" height="138"></a>
Australian Capital Territory 
<a href="https://www.revenue.act.gov.au/home-buyer-assistance/first-home-owner-grant" target="_blank"><img src="/images/2015/07/28/ACT%20Logo.gif" alt=""></a>
Northern Territory State Government
<a href="https://www.treasury.nt.gov.au/TaxesRoyaltiesAndGrants/Pages/default.aspx" target="_blank"><img src="/images/2015/07/28/nt1.jpg" alt=""></a>
 
Queensland State Government
<a href="https://greatstartgrant.osr.qld.gov.au" target="_blank"><img src="/images/2015/07/28/qld.png" alt=""></a>
Government of South Australia
<a href="https://www.revenuesa.sa.gov.au" target="_blank"><img src="/images/2015/07/28/sa.png" alt="" width="309" height="206"></a>
Tasmanian Government
<a href="https://www.sro.tas.gov.au" target="_blank"><img src="/images/2015/07/28/tas.png" alt=""></a>
State Revenue Office of Victoria
<a href="https://www.sro.vic.gov.au" target="_blank"><img src="/images/2015/07/28/album_photos_medium_28.jpg" alt=""></a>
Government of Western Australia
<a href="https://www.finance.wa.gov.au/cms/State_Revenue/FHOG/First_Home_Owner_Grant.aspx" target="_blank"><img src="/images/2015/07/28/govOfWATextColour_283x268.jpg" alt=""></a>
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Need to apply for a first home owner grant, exemption or bonus? State by state breakout

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Two adjoining terrace houses and a warehouse in Balmain are being jointly auction as a vacant possession, with the four separate titles, approximately 560 sqm, to be sold in one line or two and two.
The property on 77-79 Beattie Street, Balmain, comes with commercial usage rights and development potential.
Ray White Commercial Inner West principal Tim Morrison said the property with easy access to the Balmain Peninsula as well as the northern, southern and western suburbs of Sydney.
“The terraces include kitchen and amenities while the warehouse is generously sized with a mezzanine level," Mr Morrison said.
“Balmain is a hot spot for savvy investors looking for development opportunities as it is only approximately 6km to the Sydney CBD." 
The auctioned is being held 10:30am on Thursday, August 13, 2015, at 50 Margaret Street, Sydney.
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 Balmain vacant possession ripe for development

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GUEST OBSERVATION
NAB has announced it will reprice its interest‑only loans and line of credit facilities by 29bps. While this change follows the lead from ANZ and CBA, NAB’s decision appears to impact a greater share of its owner‑occupied customers (~47% of NAB’s Australian housing portfolio is affected vs ~29% of lending to investors). While positive for NAB’s near‑term earnings, we see higher attrition risk as peers may target NAB’s owner‑occupied customers. 
In the short term, we expect NAB to offer retention discounts to its owner‑occupied customers affected by this change and, in the longer term, address this issue by introducing new products. Also, while reducing interest‑only loans should be positive from a quality perspective and potentially favourable to capital, we believe it will encourage a higher level of repayments and may have an impact on NAB’s home lending volume growth.
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Earnings benefit of 3-4% 
Assuming NAB reprices 47% of its housing portfolio by 29bps, it implies a 3-4% benefit to FY16f earnings. We estimate ~30% of customers that have been affected by this change will be offered price offsets and, therefore, we expect ~33% of NAB’s housing book will be repriced. This should provide ~3% FY16f earnings uplift. 
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Banks are using their market power 
While in a normal competitive environment repricing changes of this nature may potentially lead to customer attrition in the investor segment, in this instance we believe the regulator has largely removed that risk. This repricing thematic is consistent with our thesis outlined in ‘Risk weights on returns – Part II’, and following recent changes we believe the sector is now ~30% through our estimated mortgages repricing. 
Regionals set to benefit 
We believe recent pricing changes are favourable for the regionals. As the table above highlights, we see 4-5% earnings benefit from potential repricing. However, given their recent subdued volume growth in the investor lending segment, we see scope for the regionals to grow their book before introducing repricing measures. 
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Victor German is Senior Equities Analyst at Commonwealth Bank. He can be contacted <a href="https://www.propertyobserver.com.au/https://au.linkedin.com/pub/victor-german/21/821/874" target="_blank">here</a>.
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Same, same… but a little bit different: Victor German on the big banks and their investor loan book

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]

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