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Melbourne doesn’t remain the world’s most liveable city by standing still. 
Just ask any overseas or interstate visitor returning to Victoria and they’ll tell you, Melbourne is ever moving and always growing. We wouldn’t have it any other way. 
Cranes in the sky and shovels in the ground on every street corner indicate that Melbourne is forever a moving feast, but it’s only so often we have the opportunity to truly transform the shape of our city. 
That’s why urban renewal projects are so exciting – and why we have to get them right. 
At Fishermans Bend, a 480-hectare parcel of potential just five kilometres from the CBD, we have a chance to build a thriving neighbourhood complete with local schools, parks and places for the community to get together. 
The Fishermans Bend urban renewal project is the largest of its kind in Australia. In fact, it’s bigger than every other urban renewal project in Victoria combined. 
But while Fishermans Bend has an exciting future, it’s been plagued by a murky past. 
The former industrial land became a political point of conjecture when a mere penstroke made it become some of Melbourne’s hottest, wealthiest property. 
Overnight, land spiralled in value as lucky owners reaped the benefits of the extraordinary upzone to capital city. 
Permits flew thick and fast as derelict factories or disused sites became lucrative land soon to be multi-million dollar skyscrapers. 
It was great news for the lucky few, but a growing postcode was beginning to be deprived of a neighbourhood – and a community was about to be left behind. 
Concrete jungles of skyscrapers surrounded by not much else don’t make great cities – they make an urban blight. 
Our recast vision for Fishermans Bend is taking a different approach. It’s a vision for 80,000 residents and 80,000 jobs. It’s all about making Fishermans Bend a benchmark for environmental sustainability, connectivity and innovation. 
We want Fishermans Bend to be a water sensitive community, a biodiverse community, a low carbon community and a low waste community. 
Above all, we want Fishermans Bend to be as good a community as any to live, work and raise a family. 
It starts with open space. We’ve already pressed ahead with plans for the Montague Community Park – and now we’re going further. The Framework earmarks the equivalent of two thirds the size of Docklands for open space, or 50 MCGs.  
Four new AFL-sized ovals, six soccer pitches and eight outdoor courts will give local kids badly-needed space to blow off steam and embrace healthy and active lifestyles. 
And plans are afoot for four primary schools – including the South Melbourne Primary School nearing completion – and a public secondary school is also on the list. 
Proper planning is all about earmarking services today so that they’re ready for the communities of tomorrow. Fishermans Bend won’t thrive overnight, but we’re putting the chess pieces in place now so that as the community grows, we’re ready to grow with it. 
Improved walking and cycling connections and improved bus services are immediate priorities that can’t wait. 
In the longer term, future tram networks and a metro rail connection will ensure we’re perfectly positioned to add the major transport infrastructure by the time it’s required. 
As is so often the case with poor planning, it begins with heights. 
Unfettered approvals and a free-for-all approach to permits meant Fishermans Bend was in danger of becoming an architectural disaster. 
It’s why we’ve established new planning controls that reign in heights, improve setbacks and better protect open space from overshadowing. 
We want more than just the select few to enjoy everything a Fishermans Bend life offers, so we'll ensure a diverse mix of housing options that cater for individuals and families of all shapes and sizes.  
A target of six per cent affordable housing is a cornerstone of the Framework. 
When we came to Government we could see that Fishermans Bend wasn’t quite right, so we got the independent experts on the case to work out what had gone wrong. 
Even we were stunned by the shortcomings. 
The committee's investigation found that the decision to allow unfiltered high rise developments didn't include plans or funds to accommodate essential services that make communities tick - and labelled Fishermans Bend's failed renewal "unprecedented in the developed world". 
Well, we're fixing that mess. We're building a flagship community residents can be proud to call home. 
It's a big job, but getting the planning right at Fishermans Bend will leave a long-lasting legacy - and that's exactly what we're going to do.

The Hon Richard Wynne is the member for Richmond and the Minister for Planning.

 

Read more: <a href="/news/richard-wynne-on-fishermans-bend-we-have-to-get-urban-renewal-projects-right">Fishermans Bend draft framework released</a>.

<a href="/news/walking-bikes-and-public-transport-the-big-focus-in-fishermans-bends-integrated-transport-plan">Walking, bikes and public transport the big focus in Fishermans Bend's integrated transport plan</a>.
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rwynne

Richard Wynne on Fishermans Bend: we have to get urban renewal projects right

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Skyscrapers generate a lot of buzz around Melbourne.

We are reviewing the central city planning controls for the first time in 30 years and this has generated more interest than any other planning issue I have been involved in.

Melburnians love their CBD and our city draws residents, tourists and investment from around the world.

Developers want to build here, more people want to live here and businesses base themselves here because of the amenity and character around the Hoddle Grid and Southbank.

This week we began public consultation for proposed controls which would require an 18:1 floor area ratio.

Developers can still build beyond that ratio, and there is no upper limit - but there must be something in it for the city.

Large-scale development cannot suffocate the inner city. Modelling done as part of our review showed the central city would be over-developed and degraded without government intervention.

The inner city needs to be shaped with a clear vision and we cannot allow projects to be rubber-stamped in isolation from their surrounds.

We’ve already had encouraging feedback from the property industry and the public, pleased we are creating certainty and a vision for how we want the city to grow.

It has also been said that the horse has bolted, that the sheer volume and scale of approvals to date will create dark, windy streets.

Which reinforces why new controls were necessary.

I have approved 28 inner-city projects as minister, under the previous rules - more than $7 billion worth of construction.

I have sought the best outcome for the city with every approval, and for some permits I have included conditions such as increased setbacks and improved apartment layouts.

But we need a system which pushes for great design and the best outcome from inception.

Conditions shouldn’t be bolted on at the end of the planning process.

I also reject any notion that developers will shift their focus to Sydney.

In central Sydney plot ratios rarely exceed 15:1, even with bonuses, and the average project has a 12:1 ratio.

Melbourne’s land is more affordable and the permit process in Victoria is considerably faster.

Internationally, New York, Vancouver and Hong Kong have included plot ratios of 5:1 to 10:1 with bonuses for open space, affordable housing and other community infrastructure.

Requiring good community outcomes from major development: it is common sense – and common practice.

The record demand for sites and appetite for investment would not continue if we allowed for more overshadowing and homogenous building design, with no incentive for investing in amenity.

Approvals granted by the former Planning Minister included average plot ratios of 35:1 and up to 63:1.

Rubber-stamping under the previous government meant the bar begin to fall on design quality in favour of maximum yield for profit.

Some applications which have crossed my desk clearly seek to target a high-as-possible yield with little regard to the surrounding streetscape.

That sort of unfettered development does little for innovation.

I believe our generous controls, unrestricted upper limit and the sheer talent of our architectural industry will encourage innovation.

These controls have the flexibility to respond to individual sites.

We will continue to see investment in Melbourne, but it will be coupled with good community outcomes.

I look forward to working through the submissions and ideas which come through the consultation over the next month.

But more than anything, I cannot wait to see what future projects our vision inspires.

Richard Wynne is the member of the legislative assembly for Richmond and Minister for Planning.

Editor's note: Submissions on the Central City Built Form Review close on May 30 and public hearings will be held by Panels Victoria in the coming months, before permanent controls are implemented in September. For more information, visit <a href="http://delwp.vic.gov.au/planning/policy-and-strategy/central-city-built-form-review">www.delwp.vic.gov.au</a>
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The Planning Minister: on the proposed central city planning controls

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Walking around some of Melbourne’s best-designed apartments recently, I was struck by how much design could make a small space feel like a home.

I was on the Robin Boyd Foundation’s exemplary apartment tour, showing off the best in Melbourne apartments.

In Victoria, there are some exceptional examples of how clever spaces, light and ventilation can add to liveability, and how apartments built some decades ago still hold their own today.

Victoria’s property industry is brimming with experts in clever design, the very people I’m appealing to contribute to the draft apartment guidelines our government is working on.

In May, I launched a discussion paper, <a href="http://delwp.vic.gov.au/planning/policy-and-strategy/better-apartments">Better Apartments</a>, at the Planning Institute of Australia’s national conference.

The discussion paper was chosen as the best way to kick-start consultation. Rather than beginning with draft guidelines, I want the people who deliver apartments and the people who live in them to have their say from the start.

Developers are lured to Melbourne for its liveability and investment potential.

Record-low interest rates and a thriving property market have encouraged property investors and owner-occupiers to buy. These are some of the factors pushing up apartment approvals in the past few years.

While that is great news for the state’s economy and for our property industry, we need to make sure planning policy keeps pace with the surge in apartment living.

The rise in apartments has thrown up a red flag from local government, architectural and industry bodies around the standards of some apartments in Victoria.

While I’ve seen some great apartments, I have also seen some dogboxes - poorly designed with little access to natural light, airflow and storage.

The Better Apartments discussion paper raises those concerns and weighs up housing needs, market demands and building standards with the aim of improving liveability and affordability.

The government’s goal is to deliver sustainable housing outcomes, deliver on affordability, respond to the desire to live near jobs and services while also supporting investment.

The discussion paper’s focus is on internal amenity, as well as outlook and privacy.

While apartment sizes are a hot talking point, we must keep in mind that good design is the key. There are some fantastic small apartments offering good amenity, natural light and are affordable, just as there are plenty of poorly-designed large apartments.

We are working towards guidelines that give certainty but still allow for innovation and new ideas.

As well as Better Apartments, work has begun on a refreshed Plan Melbourne strategy and we have begun detailed work to plan the country’s biggest infill opportunity, <a href="/news/fishermans-bend-proposals-an-overview">Fishermans Bend</a>.

We aren’t starting from scratch. Rather, major issues left out of Plan Melbourne and Fishermans Bend plans to date, such as energy efficiency, housing affordability and climate change, will be included.

Future planning work will also factor in the major infrastrcuture projects the Andrews Labor Government has committed to, such as the Melbourne Metro Rail project.

I look forward to hearing your thoughts on how we can deliver innovative, robust, world leading policy in apartment design. We will be holding stakeholder forums and already, online submissons and survey responses are rolling in.

We will strive to deliver apartments to balance affordability and liveability, in buildings which enhance the city skyline and the streetscape.

Melbourne leads the world in liveability, let’s see that reflected in our aspirations for apartment living.

http://delwp.vic.gov.au/better-apartments

The Hon Richard Wynne is the member for Richmond and the Minister for Planning. <a href="https://twitter.com/rwynnemp">Follow the Planning Minister on Twitter</a>.
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The Planning Minister Richard Wynne on Better Apartments

One of Brisbane's last major riverfront redevelopment opportunities has taken a significant step forward, with Lendlease selected as the Queensland Government's preferred development partner for the former Visy site in South Brisbane.

The seven-hectare industrial site, positioned between South Bank and West End and 1.3 kilometres from the Brisbane CBD, will be transformed into a mixed-use precinct expected to deliver more than 4,000 new homes alongside extensive public open space and riverfront parkland.

The project is one of the largest urban renewal opportunities currently planned in Brisbane and is expected to play a key role in accommodating the city's growing population ahead of the 2032 Olympic and Paralympic Games.

Plans for the precinct include a network of riverfront promenades and boardwalks, new public plazas, parkland, amphitheatre-style gathering spaces and shared pedestrian and cycling links designed to reconnect the long-isolated site with the Brisbane River.

The Queensland Government is targeting delivery of the first homes and key public spaces before the 2032 Games, allowing the precinct to begin contributing new housing and public amenity well before the broader masterplan is complete.

The redevelopment is also expected to support more than 3,000 jobs across planning, construction and ongoing operations.

For Lendlease, the appointment adds another major urban regeneration project to its Queensland portfolio. The developer has operated in the state for more than 70 years and has delivered a number of large-scale mixed-use precincts in partnership with government.

Lendlease Development CEO Claire Johnston said the project represented one of Brisbane's most significant redevelopment opportunities.

"The transformation of the former Visy site represents a rare opportunity to reimagine one of Brisbane's most significant riverfront locations, deliver thousands of much-needed homes, and create long-term legacy," Johnston said.

"In partnership with the Queensland Government, we have the opportunity to create a new riverside destination that will help shape Brisbane's growth and how people experience the city for decades to come.

"This is exactly the type of large-scale, city-shaping development that will provide lasting benefits for Queensland, bringing together housing, jobs and world-class public spaces."

Deputy Premier and Minister for State Development, Infrastructure and Planning Jarrod Bleijie said the riverfront transformation would deliver a thriving new community precinct.

“The Crisafulli Government is delivering this golden opportunity to unlock a riverfront jewel for all Queenslanders,” Deputy Premier Bleijie said.

“This is a once-in-a-generation moment to reshape a significant slice of Brisbane and deliver lasting benefits – thousands of new homes, and public spaces for all Queenslanders to enjoy well beyond the 2032 Olympic and Paralympic Games – unlike Labor’s plan which would have delivered zero benefits and zero new homes.

“Queensland is well and truly open for business and through partnership with the private sector, we are accelerating delivery while ensuring strong housing, community and economic outcomes."

Early works on the precinct are expected to commence in April 2027.

Joel Robinson

Lendlease selected to deliver transformative South Brisbane riverfront precinct

Eddy Haddad's <a href="https://www.apartments.com.au/developers/level-33">Level 33</a> is levelling up its approved Wollongong development, as the coastal city south of Sydney continues to prove popular in the high-density development space.

Level 33, a longtime developer in the Wollongong area, has gone through the NSW Government's Housing Delivery Authority to upsize its approved two-tower development on the corner of Crown Street and Gladstone Avenue, just 100 metres from Wollongong Station.

The developer currently has approval for 252 apartments across two buildings rising to 19 storeys. It is now seeking approval for 33 and 38-storey towers that would deliver 467 apartments, including 67 affordable homes.

Designed by <a href="https://www.apartments.com.au/architects/bka-architecture">BKA Architecture</a>, the development would comprise apartments above a three-level podium with around 1,100 sqm of retail space, along with basement parking for 448 vehicles.

According to the Urban Design Report by BKA, the proposal has the capacity to "reinforce the precinct's identity by strengthening links between health, education, and transport services, while also contributing to Wollongong's ongoing evolution as a key regional centre."

Wollongong is somewhat in vogue. Between Level 33 and Urban Property Group, the two developers have several thousand apartments planned across the city.

Level 33 is currently delivering Easterly Wollongong, one of its most boutique projects to date with just 21 high-end apartments, as well as Atchison &amp; Kenny, a 329-apartment development due for completion later this year.

The developer plans to redevelop the 13,088 sqm WIN Grand megasite into <a href="https://www.apartments.com.au/new-apartments/crown-square-216-238-keira-street-wollongong-nsw-2500">Crown Square</a>, a new $500 million precinct with nearly 600 apartments. It also has more than 900 apartments planned for the former Bunnings Warehouse site at the intersection of Gipps and Flinders streets.

Urban Property Group is also playing a major role in the city's transformation. Its five-tower Keira Place precinct will deliver more than 800 homes, and it has recently lodged plans for a further 300 apartments near Wollongong Station.

First look: Level 33 upsizes Wollongong apartment towers

Just a week after filing plans for the final stage of its major Keira Place masterplan, <a href="https://www.apartments.com.au/developers/urban-property-group">Urban Property Group</a> has unveiled another significant housing proposal in Wollongong, this time targeting a prominent site opposite North Wollongong Station.

The developer has lodged a State Significant Development Application for a 38-storey mixed-use tower at <a href="https://www.apartments.com.au/new-apartments/4-4a-flinders-street-north-wollongong-nsw-2500">4-4A Flinders Street</a>, around one kilometre north of the <a href="https://www.apartments.com.au/new-apartments/keira-place-wollongong-120-122-smith-street-wollongong-nsw-2500">Keira Place precinct</a> currently taking shape on the edge of the CBD.

<img alt="First look: Urban Property Group plans 38-storey North Wollongong tower as Keira Place expansion gathers pace" data-entity-type="file" data-entity-uuid="2b6428f1-6405-4038-8476-897de440e90d" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/flinders%20podium.png?VersionId=QLqEvK0OuCEwRC47oHNftrw2B1YqaHF8" />

Designed by Studio.SC, the proposal comprises a 38-storey mixed-use development containing 303 apartments, including 45 affordable housing units, alongside 174 co-living residences. The scheme also includes ground-floor retail space, extensive landscaping and public domain improvements.

Studio.SC noted in the proposal it "outlines a vision for a landmark transit-oriented mixed-use development centred around North Wollongong Station, designed to support the city’s future growth while responding to the NSW Government’s housing and planning reforms."

The architecture firm said the proposal responds to the opportunities and constraints shaping future growth within the 400-metre catchment of the station and represents "a coordinated and future-focused approach to urban intensification, contributing to the long-term evolution of North Wollongong as a connected, walkable and high-density station precinct."

The site occupies a strategic corner bounded by Flinders Street, Station Street, Stafford Street and the Princes Highway, directly opposite North Wollongong Station.

<img alt="First look: Urban Property Group plans 38-storey North Wollongong tower as Keira Place expansion gathers pace" data-entity-type="file" data-entity-uuid="7863adad-1f71-4022-b850-f44b252738fd" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/flinders%20podium%20a.png?VersionId=WsU7av0g8_8R2tGHWxgHeFSlhu7yeY1V" />

The proposal follows Urban Property Group's recent submission for the second and final stage of Keira Place, which would deliver a further three buildings comprising 657 homes opposite Beaton Park. It builds on the first stage, which features 150 apartments across two towers and recently commenced construction.

Urban Property Group CEO Patrick Elias said breaking ground on the first stage marked a significant milestone for Wollongong and reflected the developer's long-term commitment to regional cities.

"Today's groundbreaking is about turning approvals into homes and moving quickly to deliver much-needed housing in Wollongong's city centre," Elias said.

"Keira Place will provide a diverse mix of homes close to jobs, transport and services, while setting a high benchmark for quality, durability and consumer protection."

Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/urban-property-group-unveils-trio-of-towers-for-next-stage-of-new-wollongong-precinct-keira-place">Urban Property Group unveils trio of towers for next stage of new Wollongong precinct, Keira Place</a>

First look: Urban Property Group plans next major Wollongong tower

<a href="https://www.apartments.com.au/developers/arada">Arada Australia</a> has wasted little time expanding its ambitions in Campsie, lodging plans for a second major project in the rapidly transforming town centre just months after unveiling its three-tower One Campsie proposal on Beamish Street.

The UAE-backed developer has now taken aim at one of the suburb’s most strategically positioned sites, filing a State Significant Development Application for a <a href="https://www.apartments.com.au/new-apartments/10-north-parade-campsie-nsw-2194">33-storey mixed-use tower</a> at 10 London Street and 43 North Parade, directly opposite the future Campsie Metro Station. The proposal is currently on public exhibition and represents another significant vote of confidence in Campsie's emergence as one of Sydney’s key transit-oriented growth centres.

Designed by <a href="https://www.apartments.com.au/architects/woods-bagot">Woods Bagot</a>, the development would deliver 156 apartments above a podium containing retail and commercial space, creating a new residential and commercial gateway to the town centre. The scheme also includes a four-level above-ground parking podium and a dedicated residential amenity floor featuring wellness and recreation facilities. At least 10 per cent of the apartments would be allocated as affordable housing for a period of 10 years.

The proposal occupies a 1,631 sqm site bounded by London Street, North Parade and Dispensary Lane, immediately adjoining the future Metro station precinct and just metres from Beamish Street’s retail and dining strip. According to the Urban Design Report, the project seeks to deliver "a great place that prioritises human-scaled experience and provides spatial improvements to the area."

<img alt="First look: Arada doubles down in Campsie with 33-storey Metro-front tower plans" data-entity-type="file" data-entity-uuid="175a8324-015b-4856-abe3-ce6f23199fa7" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/podium%20campsie.png?VersionId=742UGwXFhFBX4GEl6wX4PYIWREAgn6il" />

Woods Bagot describes the tower as a key marker within Campsie's next phase of growth.

"Located directly opposite the new Campsie Metro Station on North Parade, 10 London Street is a thoughtfully composed 33-storey mixed-use tower that contributes to the ongoing transformation of the town centre," the Architectural Design Report states. The report says the project is intended to provide "high-quality homes within a vibrant, connected urban environment, while helping define Campsie's future skyline."

A strong emphasis has been placed on the public realm. The ground floor incorporates over 500 sqm of retail space and active frontages along both London Street and North Parade, while the podium is wrapped by extensive landscaped planting intended to soften the building's scale and strengthen the pedestrian experience. The development would also widen surrounding footpaths and improve connections between the Metro station and the broader town centre.

Above the podium, residents would have access to more than 1,400 sqm of communal amenities, including a pool, gym and landscaped recreation spaces. A distinctive green-wall treatment extending across four podium levels forms a major architectural feature, helping differentiate the project within the emerging high-density precinct.

The tower's design is closely tied to the broader Campsie Town Centre Master Plan and the arrival of Sydney Metro. The Urban Design Report notes the proposal "directly supports the Campsie Town Centre Master Plan by delivering new homes in a location explicitly identified for growth, improved accessibility, and high-quality urban renewal." It adds that the project contributes to the master plan's vision for a strengthened town centre supported by thousands of new homes around the future Metro station.

<img alt="First look: Arada doubles down in Campsie with 33-storey Metro-front tower plans" data-entity-type="file" data-entity-uuid="bfd17654-253e-489a-bade-6278d63db412" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/base%20campsie.png?VersionId=3roJPMQGs36dazpkhvpvbDDP73Ld.Ica" />

The application follows Arada Australia's recently lodged One Campsie project at 124–142 Beamish Street and 16–18 Ninth Avenue, where the developer is seeking approval for 346 apartments across three towers rising 24, 32 and 39 storeys. Together, the two proposals would cement Arada Australia as one of the most influential developers shaping Campsie's future urban form.

Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/first-look-arada-files-for-trio-of-apartment-towers-in-campsie-town-centre">First Look: Arada Australia files for trio of apartment towers in Campsie town centre</a>

Arada Australia entered the Australian market in 2024 and has rapidly assembled a significant development pipeline across Sydney. Alongside its Campsie holdings, the developer is soon to launch <a href="https://www.apartments.com.au/new-apartments/wattle-green-2-fishburn-crescent-castle-hill-nsw-2154">Wattle Green</a> in Castle Hill, and has expanded its local operations following its acquisition of construction firm Roberts &amp; Co.

Located around 14 kilometres south-west of the Sydney CBD, the site sits at the centre of one of Sydney's fastest-changing middle-ring precincts. The Metro conversion of Campsie Station, combined with Canterbury-Bankstown Council's master planning framework, is driving significant residential intensification around Beamish Street and North Parade, with thousands of new homes expected over coming decades.

First look: Arada Australia doubles down in Campsie with 33-storey Metro-front tower plans

For the first time in a long time, Australia's inflation story is starting to look more like a landing than a fight.

The latest Consumer Price Index figures from the Australian Bureau of Statistics showed annual inflation eased to four per cent in May, down from 4.2 per cent in April. On the surface, that might not seem like a major move. Inflation remains above the Reserve Bank's target range and some categories continue to record stubborn price growth.

But the significance of this result lies less in where inflation sits today and more in what it means for where interest rates are likely heading next.

The biggest takeaway is that inflation continues to move in the right direction.

Markets had been bracing for another sticky result after a period where progress appeared to stall. Instead, headline inflation came in softer than expected, helped by falling fuel prices and easing transport costs. Annual transport inflation halved from 6.6 per cent in April to 3.3 per cent in May, while automotive fuel prices fell 11.9 per cent during the month following lower oil prices and the impact of reduced fuel excise measures.

While petrol prices don't solve Australia's affordability challenges, they are one of the most visible and immediate costs for consumers. Falling fuel costs feed through the economy quickly, helping ease pressure on household budgets and business operating expenses.

The ABS data also showed headline inflation is now sitting at its lowest annual level in several months, reinforcing the broader trend that price growth is gradually moderating.

That trend is important because it aligns with what many economists and lenders have been saying for the last month.

Prior to this week's inflation data, ANZ, NAB and Commonwealth Bank had all shifted their forecasts, now believing the Reserve Bank had likely reached the peak of the interest rate cycle. Following the May inflation release, ANZ reaffirmed that view.

In its latest economic update, ANZ said it expects quarterly trimmed mean inflation to come in at 3.7 per cent for the June quarter, slightly below the Reserve Bank's forecast of 3.8 per cent. Importantly, the bank said that outcome, when combined with slowing economic activity, "supports our view that the cash rate has peaked".

The Reserve Bank has spent the better part of three years attempting to bring inflation under control through higher interest rates. If Australia's major banks are correct and rates have now peaked, the conversation shifts from how much higher rates could go to when they might begin coming down.

Westpac's caution comes from underlying inflation. The trimmed mean, the measure most closely watched by the Reserve Bank, increased from 3.4 per cent to 3.6 per cent annually. Housing inflation remains elevated at 6.5 per cent, reflecting ongoing increases in rents, electricity costs and new dwelling construction.

Electricity prices remain particularly problematic, rising 21.1 per cent over the past year following the removal of government rebates.

Housing construction costs are also showing signs of renewed pressure. ANZ noted new dwelling costs rose 0.9 per cent in May and are now running at an annualised pace of 8.6 per cent over the past three months. Builders continue to face higher labour, fuel and material costs, a reminder that inflationary pressures have not completely disappeared.

Housing affordability has deteriorated largely because of higher interest rates rather than higher property prices alone. Even modest reductions in mortgage rates would improve borrowing capacity, increase buyer confidence and reduce repayment pressure on existing homeowners.

While August is far from a certainty, the latest inflation result has strengthened the view that the next move in rates is more likely to be down than up. For borrowers, buyers and the development sector, that alone represents a significant shift from the conversation that dominated much of the past two years.

Richard Wynne

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