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May 2015 marks a new era in Australian real estate. The rolling out of a variety of measures by banks to tighten credit policy on loans for investment properties will cause unintended and harmful consequences. From higher interest rates, to bigger deposits, and tougher loan serviceability assessments, we have already seen a number of banks bow to the pressure applied by Australia's banking regulator, APRA.
While I can't say that some form of change came as a great surprise I must say that I am bemused. It highlights just how out of touch regulators are with the real world and the distinct lack of initiative and lateral thinking that people in high places have.
APRA's concern directly relates to the two consecutive years of 15% price growth in Sydney's property market. In addition to being worried about the general sustainability of Sydney's market, the concern ~ understandably so ~ is the size of Sydney investor's debt (the median property value is about to tip $1 million; that’s a lot of coin to put down on a single asset).
Propertyology has publicly expressed concern about Sydney's market for a year or so. In our article titled <a href="https://mail.privatemedia.com.au/owa/redir.aspx?SURL=TmOKAgIe3oZ2VdJTROX84_z_q1nl0_QOLLtsovUkaDsi-YYWxWbSCGgAdAB0AHAAOgAvAC8AdwB3AHcALgBwAHIAbwBwAGUAcgB0AHkAbwBsAG8AZwB5AC4AYwBvAG0ALgBhAHUALwB3AHAALQBjAG8AbgB0AGUAbgB0AC8AdQBwAGwAbwBhAGQAcwAvADIAMAAxADQALwAwADQALwAyADAAMQA1AC0AMAAyAF8AUAByAG8AcABlAHIAdAB5AG8AbABvAGcAeQBfAFMAeQBkAG4AZQB5AE8AdQB0AGwAbwBvAGsALgBwAGQAZgA.&amp;URL=http%3a%2f%2fwww.propertyology.com.au%2fwp-content%2fuploads%2f2014%2f04%2f2015-02_Propertyology_SydneyOutlook.pdf" target="_blank">House-Of-Cards</a> we warned that intervention by APRA was a distinct possibility. Now it has happened.
But Propertyology's bemusement is due to the broad brush implementation of changes to credit policy.
Here's an important message which I (again) want to give to the 20% of Australia's population who reside in Greater-Sydney - that includes a majority of this country's regulators, policy writers, CEO's, and  commentators. WE DO NOT HAVE A PROPERTY BOOM IN AUSTRALIA. Did you read that? Understand what it means?
Property markets in locations where the other 80% of Australians live are performing perfectly normal. Of the other capital cities, Melbourne and Brisbane are currently the strongest (a typical property has grown 5-8% over the last year). Right now, properties in Perth and Darwin are starting to lose value. Adelaide, Hobart and Canberra have grown by 1-5%. What boom?
Applying tighter credit policies across 100% of the market in attempt to address a concern in 20% of the market is akin to a doctor prescribing antibiotics to an entire classroom because one kid has a chest infection.
Propertyology would argue that there has never been a safer, more viable time to invest in Australian real estate over the last decade than right now (ex-Sydney)!
World economies in general are in a recovery phase. Markets are less volatile now than at any time over the last ten years. The Australian investor's household budget is supported by the lowest interest rates we've seen in our lifetimes. Population growth remains strong. Economic development potential for Australia in the Asian Century is incredibly exciting.
When not prescribed properly, antibiotics can cause harmful side effects. One example is state and local government budgets where the <a href="https://mail.privatemedia.com.au/owa/redir.aspx?SURL=2XH9AEyRtmYccatq2LmX4LBHiXlNoF0CD2tf_Xv59G8i-YYWxWbSCGgAdAB0AHAAOgAvAC8AdwB3AHcALgBwAHIAbwBwAGUAcgB0AHkAbwBiAHMAZQByAHYAZQByAC4AYwBvAG0ALgBhAHUALwBjAGEAbQBlAHIAbwBuAC0AawB1AHMAaABlAHIALwA0ADIAOAAyADIALQB5AHQAYwAtAG0AYQB5AC0AMgAwAC0AbwBiAHMAZQByAHYAZQByAC0AcAByAG8AcABlAHIAdAB5AC0AcgBlAGwAYQB0AGUAZAAtAHQAYQB4AC0AcgBlAHYAZQBuAHUAZQAtAHMAdQByAHAAYQBzAHMAZQBzAC0ANAAwAC0AYgBpAGwAbABpAG8AbgAtAGMAYQBtAGUAcgBvAG4ALQBrAHUAcwBoAGUAcgAuAGgAdABtAGwAIwAuAFYAVwBFAG4AXwBLAEYASQB6AGIAMAAuAHQAdwBpAHQAdABlAHIA&amp;URL=http%3a%2f%2fwww.propertyobserver.com.au%2fcameron-kusher%2f42822-ytc-may-20-observer-property-related-tax-revenue-surpasses-40-billion-cameron-kusher%23.VWEn_KFIzb0.twitter" target="_blank">wide range of taxes on property transactions contributed 48.7%</a> of total combined revenue in 2013/14.
And then there’s the unsustainable reliance that Australians have on taxpayer-funded pensions (we are forking out $400 million per day, and growing). Encouraging people to invest during their 45 years in the workforce is the logical solution to living a comfortable lifestyle when they exit the workforce.
What is it with those who carry on as if 'investment' is a dirty word?
Legislators are right to be concerned about Sydney and the future household budgets of those who have invested there. But markets tend to have a way of smoothing themselves out soon enough. Antibiotics weren't needed when Brisbane property values grew 30%+ in 2003.
If intervention is considered necessary now those people in their ivory towers would have been wiser to cap loan-to-value ratios just on Sydney property. But, then again, the words 'legislator' and 'common sense' never go together.
Notwithstanding the lazy credit policy changes, property market fundamentals remain unchanged. Many markets across Australia are entering the recovery and upswing stages of the cycle. Propertyology is actively buying properties in a variety of regional locations across the country and a couple of pockets within capital cities.
Right now is one of the best periods for property investors for some years. But, you'll need to have a strategy to deal with the unwanted side-effects of the recklessly prescribed antibiotics.
 
<a name="_GoBack" href=""></a>Simon Pressley is Managing Director of Propertyology, a REIA Hall Of Fame Inductee, property market analyst, accredited property investment adviser, and Buyer’s Agent. <a href="https://mail.privatemedia.com.au/owa/redir.aspx?SURL=rC2QG79lYWrMWvVdgzlx1bfCD77gHA38Bdx1AxmR8cgi-YYWxWbSCGgAdAB0AHAAOgAvAC8AdwB3AHcALgBwAHIAbwBwAGUAcgB0AHkAbwBsAG8AZwB5AC4AYwBvAG0ALgBhAHUALwBtAG8AcgBlAC0AdABoAGEAbgAtAGEALQBiAHUAeQBlAHIAcwAtAGEAZwBlAG4AdAAvAA..&amp;URL=http%3a%2f%2fwww.propertyology.com.au%2fmore-than-a-buyers-agent%2f" target="_blank">Propertyology works exclusively with property investors</a> to purchase properties in strategically chosen locations all over Australia.
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spressley-sBoeMhannA

What is it with those who carry on as if 'investment' is a dirty word? Simon Pressley

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An unprecedented level of major projects in the pipeline has the potential to produce significant growth in Queensland property markets. Although, there are some unanswered questions with a new government coming to office.
According to our research, there are thirty seven major infrastructure projects with a combined project value of a staggering $123 billion. If they were all to proceed they would create 142,900 new direct jobs.
There’s been a lot of hype over the last couple of years about the end of the mining construction boom and very little else coming through Australia’s infrastructure pipeline. What has been unfolding behind the scenes in Queensland is quite exciting although few people realise it. I doubt whether any state at any time in Australia’s history has ever had such a big pipeline of projects.
Throughout 2014 there were a lot of approvals of major projects along with various new proposals. Queensland’s jobs growth trend began to show green shoots. By the back end of 2014, Propertyology had become quite bullish in regards to property market outlooks throughout parts of the state.
We place a heavy emphasis on job growth potential with our property market forecasting. Wherever there is a new job there is demand for accommodation.
<img src="/images/2015/05/25/QLD_Projects_Map1.jpg" alt="">
Official statistics from Australian Bureau of Statistics (ABS) shows that Queensland created a total of 11,048 new jobs over the entire last three full calendar years. This puts the 142,900 job potential from Queensland’s project pipeline in to perspective.
Jobs growth has been the biggest driver of Sydney’s remarkable property boom over the last two years. The evidence is in the ABS data.
Australia created an additional 134,408 jobs in 2014. 52,975 of these were in Sydney.
We flag Brisbane, Gold Coast, Toowoomba, and Cairns as property markets with very promising outlooks. 
 
<img src="/images/2015/05/25/QLD_Projects_Stats.jpg" alt="">
The Abbott Point expansion at Bowen and rail infrastructure must be built in order to open up the biggest coal province in the world, Galilee Basin. High rollers such as Indian billionaires Adani and GVK, Gina Rinehart, Clive Palmer, and Chinese miner Macmines collectively have projects in the pipeline worth $53 billion.
Over the last two years, the city of Mackay has struggled under falling coal prices and property over-supply. But Mackay was placed back on Propertyology’s radar due to the potential 31,500 direct jobs which would be created if the Galilee Basin was officially opened up. Brisbane will benefit from the thousands of CBD administration new jobs that will be created. To a lesser extent, Townsville’s property market would also benefit through the supply of goods and services at the coal face and at Abbott Point.
During the January state election campaign, the Queensland Labor government made it known that they were opposed to expanding port facilities, even though, under former Premier Anna Bligh, Labor had initially approved the port expansion before the Newman government scaled it back to a more sustainable size. Earlier this month, Labor flagged a new proposal for the port dredging.
The new government has officially scrapped the $5.2 billion BaT Brisbane transport infrastructure project and raised questions over the proposed Queens Wharf project – comparable in size and quality to the new Barangaroo precinct in Sydney and the Crown Casino precinct in Melbourne.
Propertyology is still investing in Brisbane however we now place a couple of other locations ahead of Brisbane. The 18,000 extra jobs from the BaT project would have been very positive for Brisbane so too would have been the Herston medical precinct proposed by the Newman government. We had also factored in 10,000 new jobs from Queens Wharf but we just don’t know what will happen there now.
The Gold Coast property market has been described by Propertyology as having potential to be the best performing market in Australia over the next two years. When the Gold Coast Mayor first made mention that the proposed $7.5 billion ASF Resort project had potential for as many as 35,000 new (direct and indirect) jobs our ears certainly pricked up. Since being elected in to office, the new state government has scrapped the project. There’s already a lot of job creating infrastructure projects under way on the Gold Coast. And our outlook for the Australian tourism industry is off the Richter scale.  
Despite several major projects being declared ‘dead’ or doubtful’ over recent months, the job creation potential from within the long list of ‘likely to proceed’ projects is still very exciting. 
Queensland property markets have suffered over recent times from low confidence after the infamous 2011 floods, falling coal prices, and cut backs in the public sector. Pre-GFC, Queensland had previously created around 60,000 new jobs each year however there was actually a net loss of jobs in 2012 and 2013.
 
<img src="/images/2015/05/25/QLD_Projects_JobsTrend-2.jpg" alt="">
Simon Pressley is Managing Director of <a href="https://www.propertyology.com.au" target="_blank">Propertyology</a>, REIA Hall of Fame Inductee, property market analyst, accredited property investment adviser, and Buyer’s Agent. Propertyology works exclusively with property investors to purchase properties in strategically chosen locations all over Australia.
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Queensland's unprecedented infrastructure pipeline: Simon Pressley

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Analysing trends of the number of properties advertised for rent is the single most useful metric for property investors to make informed property management decisions. Propertyology has just completed an analysis of rental market trends across Australia and there are some interesting trends developing.
<table style="width: 507px; height: 244px;" cellspacing="0" cellpadding="0"><tbody><tr>
<td>
<div>
Biggest Increase In Rental Stock (last 12 months)
<ul>
<li>
<a href="https://www.propertyology.com.au/wp-content/uploads/2014/04/2015-03_Propertyology_SuratBasin.pdf" target="_blank">Roma</a> QLD (311% more)</li>
<li>
<a href="https://www.propertyology.com.au/wp-content/uploads/2014/04/2015.03_Propertyology_ArmidaleNSW.pdf" target="_blank">Armidale</a> NSW (81% more)</li>
<li>
<a href="https://www.propertyology.com.au/darwin/" target="_blank">Darwin</a> NT (79% more)</li>
<li>Whyalla SA (39% more)</li>
<li>Newcastle NSW (34% more)</li>
<li>Karratha WA (32% more)</li>
<li>Perth WA (31% more)</li>
<li>Mackay QLD (25% more)</li>
</ul>
 
Biggest Decrease In Rental Stock (last 12 months)
<ul>
<li>Canberra ACT (31% less)</li>
<li>Port Macquarie NSW (30% less)</li>
<li>Muswellbrook NSW (26% less)</li>
<li>Orange NSW (22% less)</li>
<li>Gold Coast QLD (21% less)</li>
</ul>
</div>
</td>
</tr></tbody></table>
The most common method for reporting the state of a rental market is vacancy rates. Data houses such as SQM Research do this by calculating the number of properties advertised for rent as a percentage of all rental properties within that given market. For example, if a specific location had one thousand properties which make up the total rental pool and twenty five of those owners were looking for a tenant the vacancy rate would be 2.5%.
A 3% vacancy rate is considered to be a ‘normal’ market. In my experience, pressure starts to build on rental prices when vacancy rates fall below 2%.
While the vacancy rate of a particular location at a particular time is useful information I find it even more meaningful to understand the rental trends which have been forming leading up to that point in time – is the available number of properties increasing or decreasing?
Imagine yourself receiving that friendly reminder from your property manager that a lease on one of your investment properties is getting close to expiry - the tenant has stated that they will not be renewing, and your property manager now needs your instructions on what rental price to advertise your property for. Propertyology is often asked by our clients to provide input in scenarios just like this.
The most appropriate response in this situation would be different if the property was in the south-west Queensland town of Roma compared to the Nation’s capital, Canberra. Research conducted by Propertyology confirms that Roma has experienced the biggest increase in the number of properties advertised for rent over the last 12 months (from 42 to 173). Canberra has experienced the biggest decrease (from 1,056 properties to 737).
When rental trends show a significant increase in volumes of properties available the most appropriate response by the landlord is often to set the rent below the rest of your competition. 80% of something is more than 100% of nothing; rents don’t always go up. And, unless there is a pending economic shift which gives hope for a reversal of this trend in the short term it might also be appropriate to seek a 12 month term as opposed to the traditional six months.
Conversely, there is more scope to increase rents when there is a limited number of properties for tenants to choose from. And, if the trend appears to be that the number of properties available is likely to decline it might be appropriate to stick with a short-term lease.  Port Macquarie in New South Wales (from 171 properties to 119), Muswellbrook in Hunter Valley (from 226 to 167), and Gold Coast (from 2,665 to 2,125) have also seen a significant reduction in the number of properties advertised for rent.
As forecast by Propertyology quite some time ago, Darwin (79% more rentals) and Perth (31% increase on an already high base) have significantly more properties available for rent today compared to 12 months ago.
Factors which influence the number of properties advertised for rent include:
<ul>
<li>The level of supply of new properties recently built;</li>
<li>Seasonal factors such as school holiday periods, peak tourism periods, Christmas / New Year, agriculture seasons;</li>
<li>Commencement and completion of large employment contracts; and</li>
<li>Commodity price peaks and troughs.</li>
</ul>
Large volumes of properties purchased by investors (as opposed to owner-occupiers) within a short period of time will also result in more stock available in a defined rental pool. A good example of this is Sydney where it has been reported that as high as 70% of home loan approvals during 2014 were to investors (30 – 45% is ‘normal’). Logic would suggest that pressure on rents will start to ease in Sydney.
Astute property investors will also analyse rental trends as part of their broader research in determining where to invest (although there are far more important considerations than this).  
Property is an asset class which requires investors to hold for the long-term. Over the years of holding a property there will invariably be periods when there are large volumes of properties available for rent and other periods when the rental market is tight. The astute landlord will understand the economic drivers which influence demand for their market, the supply pipeline, and current rental trends.
Simon Pressley is Managing Director of Propertyology, a REIA Hall Of Fame Inductee, property market analyst, accredited property investment adviser, and Buyer’s Agent. Contact Simon <a href="https://www.propertyology.com.au/contact-us/" target="_blank">here.</a>
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Watching rental market vacancy rate trends key for investment success: Propertyology's Simon Pressley

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GUEST OBSERVATION
Depending on the time of the purchase, an investor would have experienced capital growth three times that of capital cities or lost over $300,000. It’s all in the timing!
While the property market of Queensland’s capital city is currently performing strongly, falling commodity prices has been the primary cause for property markets in traditional mining towns to experience double digit declines in value. The biggest pain has been felt in the central Queensland shire of Isaac, which consists of Moranbah and Dysart.
A typical house was worth $580,000 in December 2012 and has since declined in value to $237,500 over the next two years (a decline of 36% per annum). At the peak of the market in 2012, houses were rented for $1,350 per week. Today that same property would be rented for $320 per week.
Emerald median values have declined by an average of 15.3% per annum over the last two years. Rental vacancy rates in Emerald are currently over 8% so rents have fallen from $700 per week (2012) to $270 per week.
The regional hub of Mackay provides a majority of goods and services to the coal face. In addition to a 33% reduction in coal prices over the last two years, Mackay has built more properties than demand required. Median property values have declined by an average of 3.0% per annum over the last two years. Rents have fallen from $500 per week to $380 per week.
In the far north west of the state, Mount Isa median values have remained unchanged. Mount Isa has a diverse range of minerals which it mines whereas central Queensland is predominantly coal. Meanwhile, Brisbane median property values have increased by an average of 6.6% per annum over the last two years.
<img src="/images/2015/04/07/MiningTowns_Qld.jpg" alt="">
In spite of Queensland’s recent mining town doldrums, the fact of the matter is that these markets have (significantly) outperformed Brisbane over the long-term. Astute investors would be aware that property is a long-term asset class.
Over the fourteen years since the turn of the century, which includes the recent downturn, Moranbah’s median property value has grown by an average of 14.8% per annum compared to Brisbane’s 7.8%. Emerald (10.9% per annum), Mount Isa (8.5%) and Mackay (8.5%) have also performed better than the state’s capital city.
It wasn’t that long ago when the likes of Brisbane, Gold Coast, and Sunshine Coast were having downturns of their own and the mining towns were setting record highs.
Investing in these locations is not for the faint-hearted. ‘Timing’ is significantly more important when investing in locations where specific industries have such a significant impact on demand for housing. Often, the smart decision is to do the opposite to what the masses are doing. In the words of the world’s most famous investor, Warren Buffet: “The time to be fearful is when everyone else is greedy. The time to be greedy is when everyone else is fearful."
A sophisticated property investor who purchased in Moranbah in late 2004 would have paid $150,000 for a 3-bedroom house. Even with the recent downturn, the current value of $237,500 still represents 4.7% average annual growth over the last ten years, which is only slightly below Brisbane’s 5%.
An investor who did purchase in Moranbah in 2004 and sold at the market peak of $580,000 in late 2012 would have made a massive 18.4% average annual growth over those eight years. That’s roughly three times better than what anyone could have achieved in any capital city. Let me spell it out for you. A $15,000 deposit (10%) paid on a Moranbah property in 2004 would have become $430,000 equity over eight years. Extraordinary!
On sheer numbers alone, one could argue a very good case that now is a good time to buy in Moranbah. An investor could pick the best property of the litter with no real competition, pay only $240,000, and rent it out for $320 per week. That 7.2% rental yield is far superior to anything that any capital will offer.
Our research suggests that an upswing in coal-related locations is on the horizon. Lower labour costs and the Australian dollar has improved the viability for mining giants such as BHP and Rio Tinto.
There are multiple new mining projects in the approval pipeline throughout Queensland and the Hunter Valley. The untapped Galilee Basin is the biggest coal province in the world. Our research has calculated five large mines with combined project values of $53 billion having potential for up to 31,500 new jobs if they all proceed. Emerald, Mackay and Brisbane will be the biggest beneficiaries.
At the peak of the mining construction boom two years ago, for every one job at the coal face in central Queensland there were nine management and administration jobs in Brisbane’s CBD.
Emerald
<ul>
<li>Median value increased by 10.9% per annum over the last 14 years, significantly more than Greater-Brisbane’s 7.8% per annum</li>
<li>22% decline during 2014 calendar year</li>
<li>Median rents have declined from $700 per week in September 2012 to $270 per week now</li>
<li>Vacancy rates currently 8.2%</li>
<li>Median value of a 3-bedroom house today is $319,500 and it would rent for $320 per week (5.2%)</li>
</ul>
<img src="/images/2015/04/07/Emerald_PropertyMarket_1990-2014.jpg" alt="">
Mackay
<ul>
<li>Median house value declined 5.8% during 2014</li>
<li>Median value increased by 8.5% per annum over the last 14 years, significantly more than Greater-Brisbane’s 7.8% per annum</li>
<li>50% fewer properties sold last year compared to its 2012 peak</li>
<li>Median rents have declined from $500 per week to $380 per week over last two years</li>
<li>An overzealous construction industry has contributed as much to the current subdued market as the falling coal prices</li>
</ul>
<img src="/images/2015/04/07/MtIsa_PropertyMarket_1990-2014.jpg" alt="">
Mount Isa
<ul>
<li>Median value increased by 8.5% per annum over the last 14 years, significantly more than Greater-Brisbane’s 7.8% per annum</li>
<li>Median rents have declined from $540 per week in September 2012 to $500 per week now</li>
<li>Vacancy rates currently 3.5%</li>
<li>Diverse range of commodities in the region, whereas central Queensland is predominantly coal and gas</li>
<li>Median value of a 3-bedroom house today is $319,500 and it would rent for $320 per week (5.2%)</li>
</ul>
<img src="/images/2015/04/07/MtIsa_PropertyMarket_1990-2014.jpg" alt="">
Moranbah
<ul>
<li>Median value increased by 14.8% per annum over the last 14 years, significantly more than Greater-Brisbane’s 7.8% per annum</li>
<li>Someone who purchased at the peak in late 2012 would have paid $580,000 for a house and received $1,350 per week rent. That property today would be worth $237,500 and be rented for $320 per week</li>
</ul>
<img src="/images/2015/04/07/Moranbah_PropertyMarket_1990-2014.jpg" alt="">
Brisbane
<ul>
<li>Greater-Brisbane’s median property value has increased 7.8% per annum over the last 15 years</li>
<li>Median house rents have increased from $430 per week in September 2012 to $450 per week now</li>
</ul>
<img src="/images/2015/04/07/Brisbane_PropertyMarket_1990-2014.jpg" alt="">
Simon Pressley is managing director of Propertyology, a REIA Hall Of fame Inductee, property market analyst, accredited property investment adviser, and Buyer’s Agent. 
<a href="https://www.propertyology.com.au/more-than-a-buyers-agent/" target="_blank">Propertyology works exclusively with property investors</a> to purchase properties in strategically chosen locations all over Australia.
Photo of Mount Isa <a class="mw-mmv-license" href="https://www.propertyobserver.com.au/https://creativecommons.org/licenses/by-sa/2.5" target="_blank" style="font-size: 12.1599998474121px; line-height: 1.3em;">CC BY-SA 2.5</a>.
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Mining towns outperform capital city - but timing is critical: Simon Pressley

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GUEST OBSERVATION
The Australian Bureau of Statistics has just released its annual update on regional population growth. The combined growth of Australia’s capital cities of 1.9% for the year ending 30 June 2014 is above the national growth rate of 1.6%. I’ve analysed the data of Australia’s 550 local government authorities to find the population hotspots.
<img src="/images/2015/04/07/Aust_PopulationGrowth_2013-14.JPG" alt="">
At a greater capital city level, Perth continues its status as Australia’s fastest growing city with a growth rate of 2.2%. Perth recently became Australia’s fourth city with a population in excess of 2 million people.
Melbourne and Darwin both had growth rates of 2.2%, ahead of Sydney (1.8%) and Brisbane (1.7%). Canberra (1.2%), Adelaide (1.0%) and Hobart (0.6%) continue their trend of being Australia’s slowest growing capital cities.
Of more interest is some of the data at local government level. The fastest growing population in Australia last year was the shire of Serpentine-Jarrahdale, at the southern urban footprint of Perth. With a population of 22,698 its rate of growth for the year was 6.2% - more than three times the national average.
The south-west Sydney shire of Camden was a close second with a growth rate for the year of 6.1%.
Casting our eyes across the nation revealed these other population hotspots:
<ul>
<li>The regional standout was Busselton, in the far south of Western Australia with a growth rate 3.7%, followed closely by the central Queensland industrial powerhouse of Gladstone with 3.5%; 
</li>
<li>The famous Western Australia wine region of Augusta-Margaret River experienced a 3.4% population growth (twice the Australian average) while the gas city of Karratha in the state’s north grew by 2.9% over the year; 
</li>
<li>While South Australia’s total population growth was only 1%, regional towns Gawler (2.8%) and Mount Barker (2.1%) produced surprising results; 
</li>
<li>A thirst for higher density living in Sydney drove population growth in Botany Bay (3.4%), Canada Bay (3.0%), Strathfield and Parramatta (both 2.9%); 
</li>
<li>Regional New South Wales towns of Yass Valley (2.3%) and Maitland (2.2%) were well above the national average; 
</li>
<li>Victoria’s population growth numbers is consistent with its urban sprawl strategy. Wyndham (outer-south-west 5.6%), Whittlesea (outer-north 4.4%), Melton (outer-west 4.0%), and Cardinia (south-east 3.6%) all produced big numbers. 
</li>
<li>The historic goldfields town of Ballarat with a population of 100,000 produced 1.7% growth; 
</li>
<li>In Queensland, Somerset (3.0%), Scenic Rim / Beaudesert (2.9%), and Ipswich (2.8%) were strong. The population of Australia’s single biggest local government, Brisbane City Council, grew by 1.5%</li>
</ul>
Simon Pressley is managing director of Propertyology, a REIA Hall Of fame Inductee, property market analyst, accredited property investment adviser, and buyer’s agent.
 <a href="https://www.propertyology.com.au/more-than-a-buyers-agent/" target="_blank">Propertyology works exclusively with property investors</a> to purchase properties in strategically chosen locations all over Australia.
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Australia's population hotspots: Simon Pressley

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GUEST OBSERVATION
Psst... Got a second? I’d like to let you know of an exciting property market location which is the second biggest regional city in its state, is the principle service centre for a region which is in close proximity to large and very valuable reserves of natural resources, it has critical deep sea port infrastructure in place, one of the highest rental yields in the country, its historical return on investment is close to double that of the capital city average, and a property entry price of $300,000. 
Every single word in the above opening paragraph is true, although – intentionally – the name of the location isn’t mentioned. If I said it was a bayside suburb in a capital city the odds are that this would instantly become Australia’s biggest hotspot. Now that I reveal that it is the South Australian regional city of Whyalla many people reading this will suddenly become uncomfortable.
I can think of no better example to illustrate how emotionally-based perceptions, as opposed to solid research and logic, get in the way of property investors standing to make the most of their hard-earned money.
From my desktop, I can hear people shouting: “But Simon, Whyalla is a mining town! Regional locations are high risk compared to capital cities.”
Whyalla is actually a steel manufacturing town (18% of jobs are in metal manufacturing). It services inland mines (lots of them). Whyalla is a seaport located on the east coast of the Eyre Peninsula. Tourism is a small secondary industry.
<img src="/images/2015/03/26/MedianValues_Capitals_5yrs-15yrs.jpg" alt="">
Mining giant, BHP established Whyalla in 1901 to facilitate the transport of iron ore from mines in the state’s north, via sea, to processing plants. A blast furnace was constructed in the 1940's and Whyalla's reputation as the 'steel city' grew.
Through the 1940s, 1950s and 1960s, Whyalla's population expanded rapidly and governments began planning for a 100,000 population. Shipbuilding had become the main industry until international competition forced its closure in 1978. The steel plant has evolved through peaks and troughs under BHP, then One Steel, and now Arrium. The one constant has been its status the biggest employer.
A mineral exploration boom unfolded throughout the last decade resulting in increased population. In 2000, an educated property investor would have paid a mere $80,500 for a house in Whyalla. An outer-suburbs capital city house back then would have cost $100,000 more than that. Over the next fifteen years Whyalla produced solid growth (an average of 9.5% per annum). The capital city average over the same fifteen year period was considerably less (7.3% per annum) and included three to four years of negative growth.
Do you want to re-evaluate that earlier comment about “risk”? Perhaps, you might be starting to see my point about “perception” and lost opportunity.
<img src="/images/2015/03/26/Whyalla_PropertyMarket.jpg" alt="">
The infrastructure in Whyalla is well established; as one should expect of a century old city with 22,000 people. University of SA has a campus in Whyalla, offering programs such as business, health, and community services. Daily flights to Adelaide are available with Regional Express; Qantaslink is also looking to service the region from 2015.
Three hours north of Whyalla is Olympic Dam. Opened in 1988, Olympic Dam holds some of the biggest reserves of copper, gold, uranium, and silver in the world. State and federal government approvals were granted to BHP for a $30 billion expansion in October 2011. In September 2012, BHP suspended the project, although it is widely expected that a scaled-down expansion will proceed at some point.
<img src="/images/2015/03/26/Whyalla.jpg" alt="">
Whyalla already has deep sea port infrastructure at Port Bonython which is very likely to come in to play when BHP eventually find the most viable development model. When it does, Whyalla’s property market will, yet again, perform much stronger than capital cities.
Whyalla’s property market is currently flat. Then again, so are most markets across Australia. An investor could buy a solid three-bedroom house in Whyalla today and get change from $300,000; rental yields are over 6%. Risk? I’d suggest there is considerably more risk investing in an inner-city apartment in <a href="https://www.propertyology.com.au/wp-content/uploads/2014/04/2015-02_Propertyology_SydneyOutlook.pdf">Sydney</a> or <a href="https://www.propertyology.com.au/wp-content/uploads/2014/04/2015_01_Propertyology_MelbourneOutlook.pdf">Melbourne</a>.
But, then again, I guess that depends on whether one bases things on perception or solid research and logic!
Simon Pressley is managing director of Propertyology, a REIA Hall Of fame Inductee, property market analyst, accredited property investment adviser, and buyer’s agent. 
<a href="https://www.propertyology.com.au/more-than-a-buyers-agent/" target="_blank">Propertyology</a> works exclusively with property investors to purchase properties in strategically chosen locations all over Australia.
Photo of Whyalla courtesy of Wikimedia Commons.
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The regional city that has outperformed all capital cities for 15 years: Simon Pressley

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GUEST OBSERVATION
With a population of approximately 170,000 people, Toowoomba is Australia’s second largest, non-coastal city, behind Canberra. It is the only zone in South East Queensland not to experience population growth above the national average over the last decade.
While its property market has teased with glimpses of green shoots every so often Toowoomba mostly underperformed over the last decade.
Situated 700 metres above sea level on the Great Dividing Range, ‘The Garden City’ is among rich volcanic soils. With agriculture among its economic mix, prolonged drought adversely affected the region for a few years, although new infrastructure has subsequently improved water security.
The city is a well established service centre for the Darling Downs agriculture industry, the expanding coal and gas industry in the Surat Basin, and the army aviation centre at Oakey. Toowoomba is also somewhat of an education hub with the well-funded South Queensland University, a few small university campuses and quality private schools.
A new, <a href="https://www.facebook.com/Propertyology" target="_blank">international-scale airport</a> officially opened in November 2014. This significant piece of transport infrastructure has the potential to <a href="https://www.propertyology.com.au/understanding-asian-century-key-to-success/" target="_blank">open up the region’s economy</a>. Qantas has already committed to a dozen flights per week to and from Sydney
Construction of the Wellchamp business park is currently underway and there is also a proposal for a nearby aviation school. $500 million is to be invested in expansion of retail facilities.
The tender for the <a href="https://www.propertyology.com.au/wp-content/uploads/2014/04/2014_09_Propertyology_MainEmploymentSectors_web.pdf" target="_blank">$1.5 billion Second Range Crossing</a> project is due to be announced early in 2015; construction should start shortly thereafter. This will significantly improve general public access between Brisbane and Toowoomba and significantly improve road freight safety and commute times.
Up and down housing supply from year to year has tended to keep pace with demand overall. <a href="https://www.propertyology.com.au/your-results/" target="_blank">Our research</a> suggests areas where new supply will be concentrated most include Highfields, Gowrie, Glenvale, and Westbrook.
<img src="/images/2015/02/25/Toowoomba_SupplyDemand_2006-2014.jpg" alt="">
Toowoomba is positioned along a national inland freight corridor and the proposed Melbourne-Brisbane inland port. Private and government investment <a href="https://www.propertyology.com.au/more-than-a-buyers-agent/">provides opportunities</a> for economic growth in tourism, agricultural, aviation, warehousing and logistics.
Simon Pressley is managing director of <a href="https://www.propertyology.com.au/more-than-a-buyers-agent/">Propertyology</a>, a full-time property market analyst, accredited property investment adviser, and Australia’s (REIA) Buyer’s Agent of the Year (2012+2013+2014).
Photo courtesy of Porjo/ <a class="mw-mmv-license" href="https://creativecommons.org/licenses/by-sa/3.0/" target="_blank" style="font-size: 12.1599998474121px; line-height: 1.3em;">CC BY-SA 3.0</a>.
<h2>How to purchase high-performing investment properties: a free Propertyology eBook</h2>
 
 
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Toowoomba has underperformed, but new infrastructure is promising: Simon Pressley

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GUEST OBSERVATION
Our reading of key metrics suggests that Perth property values are likely to end this year a below where they started the year. Sadly, the news doesn’t get any better.
Sales volumes peaked two years ago and the numbers since have steadily declined. REIWA has reported the latest vacancy rate for Greater Perth at 4.2%, making it easily the highest of all Australian capital cities. Put simply, neither property values nor rents have any pressure currently being applied.
As shown in this graphic, the levels of new supply in the pipeline are at record levels so the pressure valve will be released even further as new stock comes on line. Sales listings have increased over the last 12 months by a massive 46% and broke through the 13,000 barrier in December 2014.
<img src="/images/2015/02/26/BuildingApprovals_Style_2014.12.jpg" alt="">
But, the bigger concern for Perth’s market is on the demand side of the equation. Perth’s impressive run as the nation’s leader in population growth stakes has ground to a halt.
76% of Western Australia’s total population live in the state’s capital (the highest concentration rate in Australia).
<img src="/images/2015/02/26/Population_GrowthRate_2014.06.jpg" alt="">
There has been a sharp decline in the number of people relocating to WA (that is, Perth) over the last 12-18 months. The latest figures released by Australian Bureau of Statistics (ABS) shows a net overseas migration figure of 3,384 for the June 2014 quarter; well below the 10,201 average for the previous three comparative periods.
<img src="/images/2015/02/26/PropertyEconomy_2014.12.jpg" alt="">
As shown above, interstate migration has also been in decline. During 2011 to 2013, a net 2,000 people would typically relocate to WA from other states every quarter. The latest ABS data shows that a net 33 people left WA; the first time that the state has produced a negative figure since June 2003. To describe demand for extra accommodation as ‘easing’ is a gross under-estimate.
When we took a closer analysis of Perth’s economy to see where future demand might come from things look dull.
Iron ore plays a hugely important role in WA’s economy, accounting for 20% of the State’s total revenue and employing more than 61,000 people directly in 2013-14. Iron ore prices have fallen 50% over the last 3 years, hitting state government revenues hard and resulting in its first budget deficit in 15 years ($1.3 billion in 2014 and estimated to be a further $900 million in 2015).
While there are many mining jobs are in the state’s north, most of them live in Perth. 10,000 employees currently working on the Gorgon liquefied natural gas project and Roy Hill iron ore mine will be looking for new jobs once construction is completed later this year. The scenario will be the same for a further 6,000 workers on the Wheatstone LNG project that is set to be completed in 2016.
In spite of lower iron ore prices, mining heavy weights Rio Tinto and BHP have ramped up production. There is a school of thought that this is a strategic choice to squeeze out smaller players. There is a suggestion that, once the damage is done, production will be allowed to slow which can only mean job losses. Sentiment on the Perth jobs front is subdued. There’s no sign of new mining projects to support Perth’s engineering muscle.
To the current state government’s credit, there are an unprecedented number of large projects in metropolitan Perth. As shown in this info-graphic, these include the Crown Casino expansion, new sporting stadium, a large entertainment precinct, railway and airport upgrades, hospitals, and highways.
These big projects will ensure that new jobs will continue to be created in Perth. But, the rate of job growth has definitely slowed down and government finances are likely to remain tight for some time.
<img src="/images/2015/02/26/Jobs_Trend_2009-2014.jpg" alt="">
With the most active first home buyer market in the country over the last couple of years the reduction in residents competing for rental stock has resulted in rising vacancy rates. SQM Research lists the highest vacancies in East Perth (6.7%), Yanchep (5.3%), Perth City (5.0%), Darlington (4.8%), West Perth (4.6%), South Perth (4.2%), and East Fremantle (4.0%).
Bottom line, this will be more than a lull for Perth. Something significant will need to come from left field to stimulate housing demand otherwise Perth looks headed for a prolonged slump.
Simon Pressley is managing director of <a href="https://www.propertyology.com.au/" target="_blank">Propertyology</a>, a full-time property market analyst, accredited property investment adviser, and Australia’s (REIA) Buyer’s Agent of the Year (2012+2013+2014).
<h2>How to purchase high-performing investment properties: a free Propertyology eBook</h2>
 
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Perth is headed for a prolonged slump: Simon Pressley

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GUEST OBSERVATION
Ipswich has one of the fastest growing populations in Australia over the last decade.
When a few marketing jazz words are combined with a low entry price and above-average rental yields, it’s never been difficult for the so-called property guru to attract property investors to Ipswich. But does the region really stack up?
With its vast amounts of developable, cheap land available, Ipswich plays a key role in the <a href="https://www.propertyology.com.au/keep-granny-ditch-the-flat/" target="_blank">state government’s strategy</a> to try and direct population growth away from the coast.
<table border="1" cellspacing="0" cellpadding="0"><tbody>
<tr>
<td valign="top" width="176">
Population Growth
</td>
<td valign="top" width="158">
2003-2013
</td>
<td valign="top" width="201">
2008-2013
</td>
</tr>
<tr>
<td valign="top" width="176">
 
</td>
<td valign="top" width="158">
(10yrs)
</td>
<td valign="top" width="201">
(Post-GFC)
</td>
</tr>
<tr>
<td valign="top" width="176">
Australia
</td>
<td valign="top" width="158">
1.7%
</td>
<td valign="top" width="201">
1.8%
</td>
</tr>
<tr>
<td valign="top" width="176">
Queensland
</td>
<td valign="top" width="158">
2.4%
</td>
<td valign="top" width="201">
2.1%
</td>
</tr>
<tr>
<td valign="top" width="176">
Ipswich
</td>
<td valign="top" width="158">
4.2%
</td>
<td valign="top" width="201">
3.7%
</td>
</tr>
</tbody></table>
The impact of a relatively large volume of sales of new properties in a developing region creates a distortion between the data for changes in median property values and the real change in property values.
As the graphic below illustrates, dwelling supply and population growth have kept pace with each other. In spite of the regular hotspot rhetoric that Ipswich cops from time to time, its property market performance has in fact been quite underwhelming.
<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/2015/01/27/Ipswich_SupplyDemand_2006-2014.jpg" alt="">
With a traditional blue-collar demographic, successive state governments and the Ipswich City Council have had to work hard to create sufficient jobs for its growing population.
The award-winning Springfield masterplanned community has been developed over the last decade as a satellite city - Brisbane’s version of Parramatta.
<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/2015/01/27/Ipswich_GreenfieldMap.jpg" alt="">
Already with a new hospital, business park, and railway line, Springfield currently has several good projects in the pipeline. These include a $50 million expansion of the University of Southern Queensland, $70 million headquarters for GE, $80 million Mater hospital, $100 million Brookwater resort and plans to further extend the Orion shopping centre.
The existing Amberley RAAF base has also been spoken about as an anchor tenant for a potential aeronautical precinct.
Investors could do worse than Ipswich, although it is far from our first preference. With so much land flagged for development, expect to see significant new supply, mostly concentrated around Springfield, Ripley, and Redbank Plains.
There is currently in the vicinity of $275 million in house and land packages currently under construction. The Springfield Land Corporation has also just announced a proposal to develop 10,000 new apartments.
Simon Pressley is managing director of <a href="https://www.propertyology.com.au/" target="_blank">Propertyology</a>, a full-time property market analyst, accredited property investment adviser, and Australia’s (REIA) Buyer’s Agent of the Year (2012+2013+2014).
Picture courtesy of Clarebear/ <a class="mw-mmv-license cc-license" href="https://www.propertyobserver.com.au/https://creativecommons.org/licenses/by-sa/3.0" target="_blank">CC BY-SA 3.0</a>.
 
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How the Ipswich region stacks up: Simon Pressley

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GUEST OBSERVATION
While there may still be a bit of steam left in Sydney’s property engine, I previously described Sydney’s market fundamentals as being <a href="/expert-insights/sydney-s-property-market-is-a-house-of-cards">as fragile as a house of cards</a>.
A statement in February’s Reserve Bank press release could be a suggestion that a joker in the pack may soon be played.
It is this statement from the RBA that could suggest that policy makers may soon play that joker:
"Credit growth picked up to moderate rates in 2014, with stronger growth in lending to investors in housing assets. Dwelling prices have continued to rise strongly in Sydney, though trends have been more varied in a number of other cities over recent months. The Bank is working with other regulators to assess and contain economic risks that may arise from the housing market".
The concerns for Sydney are these:
<ol>
<li>Lack of affordability (long been Sydney’s Achilles heel),</li>
<li>A very high level of sales transactions to investors,</li>
<li>Potential tightening of credit policy specific to Sydney,</li>
<li>Potential policy changes by Australia’s Foreign Investment Review Board to curb Asian investors, and</li>
<li>A significant supply of <a href="https://www.propertyology.com.au/wp-content/uploads/2014/04/ApartmentsApproved_States_2014-04.jpg" target="_blank">new dwelling stock in the pipeline</a>.</li>
</ol>
Under ‘normal’ circumstances the RBA responds to a property boom with a few interest rate hikes to caution consumers. But this current boom is isolated to Sydney – it’s not like the RBA can raise rates just in Sydney.
In fact, the RBA’s decision at its February meeting to reduce rates has the potential to add fuel Sydney’s market. A subdued employment market and sharp declines in commodity prices are bigger national issues which forced the RBA’s hand.
This is where that “working with other regulators to assess and contain economic risks that may arise from the housing market” comment is so interesting. What if the Foreign Investment Review Board passed legislation to restrict Asian investment in Australian real estate? Joker number one!
What if banks (with some ‘encouragement’ from the likes of APRA and / or RBA) tighten their credit policy just on Sydney-based securities to shelter themselves from extra risk? Banks have been known to do this before when they’ve identified a ‘location risk’ in the likes of the Pilbara and Moranbah. Joker number two!
Another possibility lies in China where there are reports of residential market declines of 15% over the last 12 months. Chinese banking executives and economists say that a severe housing downturn could cause a considerable increase in non-performing loans amongst Chinese banks. We know that when times get tough investment properties are often one of the first assets disposed of in order to bring the household budget back in to order. Further instability in China’s market could result in high levels of resale stock in Sydney. Joker number three!
Regardless, we expect vacancy rates to increase and rental yields to reduce in Sydney. An unhealthily high ratio of investor-owned properties is already occurring with ABS data confirming that 60% of NSW home loan approvals (refer Sydney) were for investors [30% is ‘normal’].
The Fundamentals
The performance of Sydney’s property market over the past 18-24 months is as spectacular as it is concerning.
Contrary to tabloid rhetoric, outside of Sydney, property markets are experiencing <a href="https://www.propertyology.com.au/wp-content/uploads/2014/04/MedianValues_Capitals_2011-2014.jpg">a predictable post-GFC recovery phase</a> with normal rates of growth (0 to 6%) over the past 12 months.
The state of New South Wales is home to 7.4 million people (a third of <a href="https://www.propertyology.com.au/wp-content/uploads/2014/10/Aust_PopulationConcentration.jpg">Australia’s total population</a>) and 4.3 million (18.7%) of these are in Sydney
<img src="/images/2015/02/09/pressley%20feb%209%20one.png" alt="">
Greater-Sydney can be broken in to ‘Metropolitan’ and ‘Western Sydney’. With a population of 2.06 million people (8.9% of Australia), Western Sydney on its own is bigger than the combined populations of South Australia, Tasmania, ACT, and Northern Territory.
With a median house price of $730,000 Sydney is the least affordable location in Australia (miles above the capital city average of $580,000).
For the same price that you can buy a Sydney apartment (median value $576,000) you can buy a house in every other location in Australia with the exception of Melbourne.
Sydney’s population growth rate has been below the national average for much of the past 10 years, and only ahead of economic minnows South Australia and Hobart. Rate of growth is completely different to population size.
<img src="/images/2015/02/09/pressley%20feb%209%20two.jpg" alt="">
New South Wales has a long history of people immigrating away from Sydney to alternative locations. Cost of living, especially housing, is a key factor.
<img src="/images/2015/02/09/pressley%20feb%209%20three.jpg" alt="">
Sydney has been Australia's worst performing capital city market since the 2000 Olympic Games. Sydney’s high property prices meant less buyer competition to force the rate of growth that other locations around the country have historically experienced. It’s not until we had 60-year low interest rates that Sydney has first significant price growth spurt in more than a decade.
<img src="/images/2015/02/09/pressley%20feb%209%20four.jpg" alt="">
Through 2000 to 2010, the NSW unemployment rate was regularly above the national average. A massive job swing has recently occurred; of the <a href="https://www.propertyology.com.au/the-environment-for-property-investors-is-healthy/" target="_blank">134,408 jobs created nationally</a> during 2014, 52,975 of these were in Sydney. Boom!
<img src="/images/2015/02/09/pressley%20feb%209%20five.jpg" alt="">
Metropolitan Sydney is Australia’s white-collar capital and unemployment rates are currently up to 50% better than the national average. Much of the recent jobs growth has been in white collar sectors such as financial services. If only people can afford to buy a property in Metro Sydney.
Large parts of Western Sydney, on the other hand, have significantly fewer job opportunities. Manufacturing accounts for 16% of jobs (not ideal in the current climate) while a fifth of all businesses are in the construction industry. Australia’s highest crime rates are in Western Sydney.
<img src="/images/2015/02/09/pressley%20feb%209%20six.png" alt="">
To overcome a reported 182,000 job shortfall, tens of thousands of people have to commute from the more affordable western suburbs to work in metro Sydney each day.
Transport infrastructure has not kept pace with population growth. The rail network has not been significantly expanded since the 1930s, yet the region’s population is now five times greater. The heavy reliance on passenger cars results in horrendous traffic congestion, loss of productivity, and high fuel costs. Remember that earlier Interstate Immigration graph?
15 years of babble about Sydney having run out of land and therefore having <a href="https://www.propertyology.com.au/wp-content/uploads/2014/04/Supply-and-Demand-State-by-State_2014.11.pdf" target="_blank" style="font-size: 12.1599998474121px; line-height: 1.3em;">an under-supplied property market is not totally correct</a>. Metro Sydney’s land shortage has been compensated by higher density construction while sprawl has occurred to the west. Overall, dwelling construction was greater than required until the GFC handbrake was applied. The tightening of supply is another reason for the more recent pressure on Sydney property prices.
There is significantly more supply in the property pipeline. Building approvals are now at record levels.
<img src="/images/2015/02/09/pressley%20feb%209%20seven.jpg" alt="">
My money is on Sydney performing similar to the last 15 years – below the Australian average. But the immediate question is whether policy makers play one of those jokers!
Simon Pressley is managing director of Propertyology, a property market analyst, accredited property investment adviser, and buyer’s agent.
<a href="https://www.propertyology.com.au/more-than-a-buyers-agent/" target="_blank">Propertyology </a>works exclusively with property investors to purchase properties in strategically chosen locations all over Australia.
<h2>How to purchase high-performing investment properties: a free Propertyology eBook</h2>
 
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The Sydney property market house of cards - the joker in the pack: Simon Pressley

Local developer Harridan is seeking to turn its Woolloongabba apartment project into the first stage of a broader transformation of Burke Street, using a new 16-storey mixed-use building to establish a greener pedestrian connection toward the rapidly evolving Boggo Road transport and knowledge precinct.

The South East Queensland developer has filed plans for 154 apartments on the <a href="https://www.apartments.com.au/new-apartments/4-burke-street-woolloongabba-qld-4102">southern side of Burke Street</a>, where its proposal has been designed alongside a wider vision by LatStudios for the street.

That vision positions the southern side of Burke Street for buildings of 15 storeys and above, while envisaging lower-rise development of up to five storeys on the northern side to transition into Woolloongabba's existing character housing. It also proposes wider pedestrian verges, deep planting, new street trees and upgrades to the pedestrian approach to Boggo Road Station.

The Harridan development itself has been designed by Brisbane-based Arqus Design and will comprise 154 apartments across 16 storeys. The mix is weighted heavily toward two-bedroom apartments, with 121 proposed alongside 10 one-bedroom and 23 three-bedroom residences. There will typically be around 14 units per floor.

A lower-ground car park and three podium levels will accommodate 156 resident parking spaces, along with visitor and commercial parking. There will also be 154 resident bicycle spaces and 40 visitor bicycle parks.

&nbsp;

Harridan is a family-owned developer and part of the Holmwood Highgate Group, with more than three decades of development activity across South East Queensland. Its portfolio spans residential, commercial and industrial property, with current residential projects including Riverbank on Byron in Bulimba, Esperance Residences in Carina and The Precinct at Kinross Road in Thornlands.

Wooloongabba has been popular for apartment developers, particularly since the announcement of the 2032 Summer Olympics games in Brisbane.

While there have been a lot of development applications, it has failed to materialize into real supply.&nbsp;

Sarazin has been the major player in the area. They are under construction at Murcia Residences, on the fringe of East Brisbane and Woolloongabba. They have just launched <a href="https://www.apartments.com.au/new-apartments/the-stanley-residences-woolloongabba-8-trafalgar-street-woolloongabba-qld-4102">The Stanley Residences</a>, in Woolloongabba on Trafalagar Street. They also have Nuage coming soon on the nearby <a href="https://www.apartments.com.au/new-apartments/nuage-woolloongabba-14-wellington-road-woolloongabba-qld-4102">Wellington Road</a>.

Joel Robinson

First look: Harridan plans Burke Street transformation beside Boggo Road transport hub

IN BRIEF

<ul>
	<li>
	Just three double-storey Sky Homes sit at the top of The Waterline, each with its own private marina berth and rooftop terrace.
	</li>
	<li>
	Construction on The Waterline is complete, with the first residents expected to move in from mid-October.
	</li>
	<li>
	Sky Homes range from 282 sqm to 367 sqm and are priced from $3.65 million.
	</li>
</ul>

<hr />
Lewis Land has opened the first completed sky home for inspection at Harbour Shores, giving buyers their first opportunity to step inside one of just three double-storey residences crowning The Waterline.

Each sky home comes with its own private marina berth, rooftop terrace and Broadwater views, combining the scale of a larger home with direct access to the boating lifestyle that underpins the wider <a href="https://www.apartments.com.au/new-apartments/harbour-shores-biggera-waters-564-oxley-drive-biggera-waters-qld-4216">Harbour Shores</a> masterplan.

[smartcode_project:default project_id=113271 project_image_fid=366708]

Lewis Land Head of Development Michael Long said the inclusion of a berth with every Sky Home had become increasingly valuable as marina access across the Gold Coast tightened.

“Marina berths are becoming increasingly difficult to secure across the Gold Coast, so including one with every Sky Home makes this a genuinely rare offering,” Long said.

“The private 70-berth marina will accommodate boats up to 12 metres in length and is positioned just 2.5 kilometres from the Broadwater, placing the open ocean only 15 minutes away.

“Being able to step out of your home onto your boat is a rare luxury, and it’s something residents here can look forward to when it opens later this year.”

[smartcode_project:default project_id=113271 project_image_fid=366709]

The display opening comes as construction completes on The Waterline, with the first residents expected to move in from mid-October.

The three Sky Homes range from 282 sqm to 367 sqm and each feature three bedrooms, three bathrooms, multiple living zones, expansive kitchens with butler's pantries and large balconies taking in the Broadwater outlook.

Each residence also has three secure basement car spaces and additional storage.

“This is the first opportunity the Gold Coast has had to step into Harbour Shores and see, touch and feel what we’re bringing to life here,” Long said.

“There are only three Sky Homes within The Waterline, ranging in size from 282sqm to 367sqm, with each residence featuring three large bedrooms, three bathrooms, multiple living zones, expansive custom-built kitchens with butler’s pantry, and large balconies capturing Broadwater views.”

<img alt="Harbour Shores" data-entity-type="file" data-entity-uuid="bab65e10-4fab-45e1-92d8-fc56e2ab98ff" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-25%20at%202.00.16%E2%80%AFPM.png?VersionId=XT8q76LsPkw3cYTsvN3JfFDaPLud90PN" />

Residents of The Waterline will have access to a private pool, along with Harbour Shores' wider collection of amenity including a lagoon pool, social clubhouse, tennis court, gym, yoga facilities and sauna.

Lewis Land partnered with Studio Collective to furnish the completed display, with the interiors designed to demonstrate how the residences could function as permanent homes rather than simply as show apartments.

Studio Collective Director Melissa Park said the surrounding waterways informed the interiors, but in a more restrained way than a traditional coastal scheme.

“We drew inspiration from the canals and coastal surrounds, but our approach was to interpret that subtly through layered materials and a grounded palette of earthy tones, rather than literal coastal references,” Park said.

“We introduced hero moments of green and teal to reference the surrounding waterways, while mirrored elements help reflect natural light.

“The result is a residence that feels elevated yet comfortable, somewhere buyers can genuinely imagine themselves living, entertaining and unwinding.”

Sky Homes are priced from $3.65 million.

Lewis Land is also offering private marina berths with The Residences, its limited collection of three and four-bedroom villas positioned directly along the Harbour Shores waterfront boardwalk.

Three-bedroom villas are priced from $2.99 million, while four-bedroom residences start from $3.19 million.

Harbour Shores is being marketed by Colliers International.

[smartcode_project_cta:default project_id=113271]

Lewis Land opens sky home display as The Waterline completes at Harbour Shores

St Vincent de Paul Society Housing Australia has filed plans for a major mixed-use housing precinct on the southern edge of the North Sydney CBD, adding another significant proposal to a pocket around North Sydn​ey Station that is quickly becoming one of the LGA's busiest development zones.

The State Significant Development Application covers a 5,990 sqm site at <a href="https://www.apartments.com.au/new-apartments/1-19-mackenzie-street-lavender-bay-nsw-2060">1-19 MacKenzie Street and 211 Blues Point Road in Lavender Bay</a>, immediately south of Nor​th Sydney Station and between the commercial core and the lower-rise Lavender Bay Heritage Conservation Area.

Designed by Wardle, the proposal would deliver a new residential tower comprising 88 build-to-sell apartments and 19 affordable apartments, alongside a separate co-living building with 57 rooms and a building manager's studio.

It would also see the significant restoration and upgrade of St Francis Xavier Catholic Church, the adaptive reuse of the former school building, new parish facilities, retail, a new public square and around 1,000 sqm of publicly accessible open space.

<img alt="Vinnies North Sydney" data-entity-type="file" data-entity-uuid="d5dd7f87-a617-463e-b577-17541e01f0e9" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-26%20at%209.10.13%E2%80%AFAM.png?VersionId=4R8TsFN3P_LrrXO2HswTOIrx2blil8lh" />

The project is seeking a concurrent rezoning of the site to R4 High Density Residential and an increase in the maximum building height to allow a tower reaching RL120, or up to 20 storeys. The proposal was progressed through the NSW Government's Housing Delivery Authority pathway.

The build-to-sell component will be weighted toward larger apartments, with just six one-bedroom apartments compared with 31 two-beds, 43 three-beds and eight four-bedroom residences.

The 19 affordable apartments will comprise two studios, 15 one-bedroom apartments and two two-bedroom apartments, taking the total apartment component to 107 residences before the 58 co-living rooms are included.

<img alt="Vnnies" data-entity-type="file" data-entity-uuid="7d568ca5-cb90-4e18-96c6-d9795dba0c56" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-26%20at%209.10.05%E2%80%AFAM.png?VersionId=GY2R5M9VtQh0EKy1vajaea19PSLOPuRD" />

Wardle's design for the Vinnies site has sought to negotiate that emerging high-rise context while retaining the lower-scale character of MacKenzie Street and the adjoining heritage conservation area.

The main building adopts a three-storey podium and tower arrangement, with the podium aligned to the ridgeline and front setback of St Francis Xavier Church.&nbsp;Wardle has designed the podium with colonnades, seating, recessed entries and active ground-floor frontages, with sandstone-toned precast concrete and face brick referencing the materiality of the existing church.

The tower then steps back eight metres to the south and six metres to the north before rising in a sculpted form comprising four interlocking quadrants. Wardle has also introduced rounded forms and chamfered corners to reduce the tower's perceived bulk and improve view sharing with neighbouring development sites.

Resident facilities and outdoor areas are planned at the separation between the podium and tower at Level 3, oriented toward Sydney Harbour and the CBD skyline.

The tower itself will feature a glass reinforced concrete facade, with recessed balconies and deep reveals used both to provide shading and privacy and frame views toward the harbour and city. The lower levels take a different architectural approach, using brick and sandstone-toned finishes intended to establish a stronger relationship with St Francis Xavier Church. The Church itself will be conserved and upgraded for its continued use, while the former school building will be adaptively reused as part of the co-living component.

<img alt="Lavendar Bay" data-entity-type="file" data-entity-uuid="2d4418ad-90aa-4d49-af93-c80b140aea80" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-26%20at%209.09.47%E2%80%AFAM.png?VersionId=Kv4gzbsACaGvZSRuaqcfGC54jEJRXIDJ" />

&nbsp;

The proposal adds to an increasingly concentrated pipeline of residential development around Blue Street, MacKenzie Street and Lavender Bay.

Just west of the site, Central Element lodged plans earlier this year for one of the most significant residential developments proposed in Lavender Bay in recent years.

Central Element's SJB-designed scheme at 64-66 Lavender Street and 3-7 Middlemiss Street would deliver 163 apartments across two towers rising 23 and 32 storeys, replacing five existing apartment buildings containing 32 homes. The project also forms part of the Housing Delivery Authority pathway.

<a href="https://www.apartments.com.au/news/nsw/first-look-central-element-reveals-lavender-bay-apartment-plans?utm_source=chatgpt.com" rel="noopener" target="_blank">First look: Central Element reveals Lavender Bay apartment plans</a>

Immediately around North Sy​dney Station, another two significant proposals have emerged at 5 and 15 Blue Street.

Zurich Australian Insurance Properties is seeking to adaptively reuse its longstanding commercial building at 5 Blue Street, directly above North Sydney Station, rather than demolishing the structure.

Its SSDA proposes converting the building into a 14-storey mixed-use development with 62 apartments and 86 co-living rooms, together with ground-floor retail and a major refurbishment of Blue Street Plaza. The application is currently at the Response to Submissions stage.

<a href="https://www.apartments.com.au/news/nsw/first-look-zurich-targets-north-sydney-office-conversion-with-148-unit-proposal-above-metro-station">First look: Zurich targets North Sydney office conversion with 148-unit proposal above Metro station</a>

&nbsp;

First look: Vinnies files for 20-storey Lavender Bay apartment tower as North Sydney housing pocket heats up

When the opportunity arose for South Australian developer Palumbo to return to Kent Town, where it had previously delivered East Park Apartments and the East 
Rundle Apartments, it wasn't one the longstanding developer-builder was going to pass up.

The decision was quickly vindicated, with more than 30 apartments sold within the first month of launching <a href="https://www.apartments.com.au/new-apartments/royal-apartments-kent-town-2-8-north-terrace-kent-town-sa-5067">Royal Apartments</a> to the market.

The 206-apartment development, which will bring significant new supply to Adelaide's tightly held eastern city fringe, also gives <a href="https://www.apartments.com.au/developers/palumbo">Palumbo</a> the opportunity to bring new life to one of Kent Town's most recognisable watering holes.

[smartcode_project:default project_id=6109 project_image_fid=376073]

Royal Apartments incorporates the historic Royal Hotel, a venue Palumbo Managing Director Daniel Palumbo said has a longstanding connection with the local community.

"Everyone in the area has history with the Royal Hotel," Palumbo told Apartments.com.au.

"It was quite an active pub and social gathering place for locals. We want to bring it back to its former glory."

[smartcode_project:default project_id=6109 project_image_fid=376072]

The wider development will comprise two residential towers alongside the restored hotel, sitting on North Terrace opposite the Adelaide Park Lands.

For Palumbo, the project also marks a return to familiar territory.

The developer completed East Park Apartments next door more than a decade ago and jumped at the opportunity to develop in Kent Town again when the Royal Hotel site became available.

"The opportunity emerged, and we moved to secure the site," Palumbo said.

"We were approached by the previous landowner, who said they had extensive commitments in Sydney and weren't in a position to deliver the project.

"We took over the site and within six months recut the design scheme to be more in keeping with the type of development we want to bring to Adelaide.

"Now we're on the market and those changes have really resonated with local buyers."

That has translated into a strong start to sales, with 33 apartments transacting in the project's first 35 days.

Palumbo said the early purchaser profile had been consistent with the group's traditional focus on owner-occupiers rather than investor-led apartment stock.

"Local owner-occupiers have always been our market," he said.

"There are always some investors, but we've never developed what would be called traditional development stock. Owner-occupiers are very much our market."

[smartcode_project:default project_id=6109 project_image_fid=376068]

The buyer mix has been diverse so far, with downsizers and younger professionals both accounting for a significant portion of early sales.

South Australia's current stamp duty settings, which allow&nbsp;eligible homeowners in South Australia aged 60 savings of up to $103,830 on stamp duty when they downsize to a new property valued at up to $2 million,&nbsp;have helped encourage downsizer activity, while younger buyers in their late 20s and early 30s have been attracted to the opportunity to live immediately outside the CBD while still being able to walk into the city.



Location has been a major part of the proposition for both buyer cohorts.

[smartcode_project:default project_id=6109 project_image_fid=376075]

Royal Apartments sits on North Terrace directly opposite the Adelaide Park Lands, with residents able to walk through the parklands toward the East End, Rundle Street and Rundle Mall.

Apartments have been positioned to capture views across the parklands, Adelaide skyline, Botanic Gardens and Adelaide Hills.

Palumbo believes the scarcity of developable land along this section of the Park Lands makes the site particularly difficult to replicate.

"There's very few allotments on that side that can be developed," he said.

"If this location was in New York and you were sitting on Central Park, you'd be talking about a $60 million apartments."

Royal Apartments will offer a broad mix of residences, ranging from one-bedroom apartments through to four-bedroom sub-penthouses and penthouses.

Current listings include one-bedroom apartments from $680,000, while larger three and four-bedroom residences are priced around $2.5 million.

Residents will have access to a swimming pool, gym, barbecue and recreation areas, residents' lounge and dining space, and a communal deck.

[smartcode_project:default project_id=6109 project_image_fid=376067]

The apartments will feature generous balconies, while secure parking, bicycle storage and storage cages will also be provided.

A porte-cochère-style arrival and drop-off area has also resonated with buyers, particularly those attracted to being able to walk into the CBD during the day while retaining secure vehicle access at home.

Palumbo is acting as developer, architect and builder on Royal Apartments, continuing the vertically integrated model it has used across its South Australian portfolio.

The group was also behind the $150 million Sofitel Adelaide, the 251-room five-star hotel and residential tower which opened in 2021.

Palumbo said Royal's launch had come at an interesting time for the broader Adelaide apartment market.

Buyer confidence had initially been impacted by uncertainty surrounding the Federal Budget and broader economic conditions, but Palumbo believes sentiment is beginning to improve against a backdrop of significant investment flowing into South Australia.

He pointed to increased activity across defence and resources, including Olympic Dam, as potential long-term drivers of the state's economy and housing market.

"Money is starting to flow into Adeliade, significant amounts as Adelaide bucks the trend of the rest of the country.," Palumbo said.

"There's a lot of activity in the economy over the next decade. I think more investment will come into this market."

Early works on Royal Apartments are expected to commence this year, with major construction activity and cranes anticipated on site from early next year.

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Palumbo's return to Kent Town strikes early chord with buyers

Go-to builder-developer <a href="https://www.apartments.com.au/developers/graya">GRAYA</a> is continuing to bulk out its already impressive and diverse apartment portfolio across South East Queensland. Their latest milestone is securing development approval for Silk, its boutique riverfront apartment development in St Lucia.

The approval clears&nbsp;the way for the team to begin construction planning for the 22-residence project.

<a href="https://www.apartments.com.au/new-apartments/silk-st-lucia-16-18-sandford-street-st-lucia-qld-4067">Silk</a> will rise 15 levels from an 810 sqm site at 16-18 Sandford Street, occupying a prominent bend of the Brisbane River with a prized northern aspect across Orleigh Park toward the Brisbane CBD.

The approved scheme will comprise 16 split-floor and six full-floor residences, continuing GRAYA's move into larger-format apartment developments targeting Brisbane's prestige owner-occupier market.

The project has been designed around the site's broad river frontage and dual-direction views, with GRAYA prioritising larger residences, privacy and outlook over apartment yield.

<img alt="Silk St Lucia" data-entity-type="file" data-entity-uuid="aa5c2349-f96c-4914-a812-1f2cd6827af8" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-26%20at%208.25.44%E2%80%AFAM.png?VersionId=WY0vEU_7vYjeRJKQHiCwFdMxu8PvFh52" />

GRAYA Co-founder and Chief Executive Officer Rob Gray said the project had been shaped around local homeowners wanting to remain in St Lucia without maintaining a traditional family home.

"St Lucia is one of those suburbs people do not want to leave," Gray said.

"They know the river, the trees, UQ, the golf course, Toowong and Indooroopilly, and that familiarity is hard to replace.

"True riverfront opportunities here are exceptionally scarce. What we have designed at Silk is a way to stay in the suburb people love, with the scale and privacy of a private home and far less to maintain.

"This is not typical apartment product. It is a proper home on the river, and that is exactly what this market has been missing."

The approval comes as new apartment development continues to increase across the St Lucia and neighbouring Toowong corridor, although direct riverfront sites remain considerably more tightly held.

GRAYA Co-founder and Managing Director Andrew Gray said securing the approval had removed a significant element of development risk from Silk.

"Genuine riverfront sites of this quality in St Lucia are not something that comes up regularly," Gray said.

"The approval removes a substantial layer of execution risk, and the location underwrites demand in a way very few inner-city sites can.

"The fundamentals here are as strong as anything we have assessed in Brisbane."

<img alt="Silk St Lucia" data-entity-type="file" data-entity-uuid="d0f3d734-65e1-48e8-8ed3-2e0715ffcdd9" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-26%20at%208.25.56%E2%80%AFAM.png?VersionId=sOLSs_jdHkXLWbBKzRyayf5BfTb2vPsD" />

Silk will see GRAYA return to a stretch of the Brisbane River where it already has recent construction experience. The vertically integrated group recently completed ARC in neighbouring Toowong as builder for developer Spyre, delivering the riverfront project on a constrained site.

GRAYA will take a different role at Silk, controlling the project from design and development through construction and aftercare under its vertically integrated model.

The development will include a gym and resident leisure areas at ground level, integrated with the river's edge.

Silk joins a growing pipeline for GRAYA across Brisbane and the Gold Coast, which includes Enclave, The Gallery, Coral and Ripple.

The developer-builder has also recently lodged plans for its largest project to date, <a href="https://www.apartments.com.au/new-apartments/the-silo-19-chester-street-newstead-qld-4006">The Silo</a>, a proposed <a href="https://www.apartments.com.au/news/qld/graya-buys-frasers-newstead-site-plans-the-silo-between-james-street-and-gasworks-precincts">$700 million mixed-use development</a> in Brisbane's James Street precinct.

Silk is expected to predominantly target local owner-occupiers and prestige buyers seeking a permanent riverfront home in Brisbane's inner west.

Registrations of interest are now open, with further details on the project and construction program to be released as it progresses.

<hr />
<h2>SILK PROJECT FACTS</h2>

Developer-builder: GRAYA

Project: Silk

Location: 16-18 Sandford Street, St Lucia

Apartments: 22

Built form: 15 levels

Site: 810 sqm riverfront holding

Mix: 16 split-floor and six full-floor residences

Status: Development approved

Next step: Construction planning underway

[smartcode_project_cta:default project_id=152168]

Simon Pressley

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