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EXPERT OBSERVERS
The litany of <a href="https://theconversation.com/australia-has-a-new-national-construction-code-but-its-still-not-good-enough-113729" target="_blank">defects, poor building standards</a> and <a href="https://theconversation.com/ministers-fiddle-while-buildings-crack-and-burn-120592" target="_blank">regulatory failures</a> has serious implications for apartment owners, occupiers and buyers alike. Fears of a <a href="https://www.afr.com/news/politics/national/the-apartment-building-crisis-explained-20190716-p527k0" target="_blank">loss of confidence in the sector</a> have unfortunately come true. Our research suggests a lack of reliable information about building defects is a critical factor in the crisis.
About a year ago, we started a research project with <a href="https://cityfutures.be.unsw.edu.au/documents/536/defects_project_overview.pdf" target="_blank">six industry partners</a> in New South Wales entitled <a href="https://cityfutures.be.unsw.edu.au/research/projects/defects-strata/" target="_blank">Cracks in the Compact City: Tackling Defects in Multi-Unit Strata Housing</a>. The context is compact city planning policies and a rapid shift towards apartment living in Australian cities.
The urban development strategies of NSW and other states rely on higher-density cities with many more multi-unit strata title dwellings. The <a href="https://theconversation.com/its-not-just-the-building-cracks-or-cladding-sometimes-uncertainty-does-even-more-harm-120662" target="_blank">human</a> and <a href="https://theconversation.com/flammable-cladding-costs-could-approach-billions-for-building-owners-if-authorities-dither-118121" target="_blank">economic</a> impacts of the building defects crisis could undermine these strategies.
Even with our resources, obtaining data on the extent and nature of defects in NSW apartment buildings has been a challenge. Individual buyers and owners must face even greater obstacles.
This lack of access to information poses a clear challenge to the principle of “buyer beware” that underpins property sales. The imbalance it creates between buyers and sellers is a prime example of what economists call “<a href="https://en.wikipedia.org/wiki/Information_asymmetry" target="_blank">information asymmetry</a>”.
<h2>Why does this matter for the whole apartment market?</h2>
Nobel laureate George Akerlof <a href="https://www2.bc.edu/thomas-chemmanur/phdfincorp/MF891%20papers/Ackerlof%201970.pdf" target="_blank">explained</a> how the price and quality of goods traded in a market affected by information asymmetries tend to gradually reduce to the point where only lowest-cost “lemons” remain. When buyers can’t tell the difference between products of good and bad quality, they typically prefer the cheapest available. This forces higher-quality products out of the market.
Sellers can also exploit this situation to hide poor-quality products from consumers. They might even charge the same as competitors selling higher-quality products.
While some unscrupulous sellers might profit in the short term, overall profits fall for everyone as confidence and links between price and quality are undermined. Ultimately, the entire market can collapse.
The risks are highest in markets with these two features:
<ul>
<li>sellers are not rewarded for delivering information to buyers or cannot disclose it effectively</li>
<li>buyers cannot discriminate between the quality of different products, as is often the case in apartment developments.</li>
</ul>
These problems are more likely when buyers cannot easily inspect products at the time of sale – as with apartment units bought off the plan.
When a vendor sells a product to multiple buyers, again typical in apartment developments, that can multiply the impact of information asymmetries.
The buyer of a standalone house might be able to make the sale conditional on an independent inspection of the entire building. But such clauses are very difficult to negotiate in off-the-plan sales for apartments in multi-unit buildings.
It would also be too costly for each buyer to commission such an inspection. Buyers are unable to organise a joint inspection of the building until after they have settled, which greatly increases their risk. While NSW’s new <a href="https://www.fairtrading.nsw.gov.au/housing-and-property/strata-building-bond-and-inspections-scheme" target="_blank">defects bond scheme</a> does require an inspection, it happens after ownership is transferred.
The negative impacts for buyers have spill-over effects as information asymmetries mean risks are perceived to increase across the entire apartment housing sector. <a href="https://www.afr.com/property/residential/the-opal-tower-effect-sydney-high-rise-site-sales-crash-50-per-cent-20191024-p533t4" target="_blank">Negative publicity</a>, such as the <a href="https://www.news.com.au/national/stalemate-leaving-fireprone-ticking-time-bombs-around-australia/news-story/7b26701bd6a690238a98e590c7d9a76a" target="_blank">flammable cladding</a> and <a href="https://www.smh.com.au/national/we-ve-had-ceilings-collapse-sydney-s-30-million-in-defect-payouts-revealed-20190705-p524kq" target="_blank">defects</a> scandals, can cause values to fall market-wide, regardless of the quality of individual developments. At the same time, <a href="https://www.smh.com.au/politics/federal/berejiklian-calls-for-national-solution-amid-building-crisis-20190715-p527gj" target="_blank">finance and insurance costs increase</a>.
The issue persists for subsequent buyers too. Information about defects is often unavailable due to <a href="https://www.afr.com/property/residential/a-bigger-problem-than-building-defects-20190724-p52a6g" target="_blank">poor record-keeping</a> or <a href="https://cityfutures.be.unsw.edu.au/documents/424/Case_Study_Poster_-_Defects_3.pdf" target="_blank">confidentiality agreements</a>. Ironically, this adds to the information asymmetries that contributed to the problem in the first place.
<h2>What can we do about the problem?</h2>
To reduce information asymmetries, sellers and buyers tend to engage in two main types of behaviour: <a href="https://www.semanticscholar.org/paper/Job-Market-Signaling-Spence/c63c6222735629d0e232d5b2532152bf3b0880a8" target="_blank">signalling and screening</a>.
Signalling involves sellers flagging the higher quality of their products to buyers indirectly. For example, a reputable developer may use warranties and brands or quality marks, certificates and awards as a sign of their high-quality work. Buyers may well be prepared to pay more for higher-quality products that won’t cost more in the longer term.
Crucially, signalling only works if the signal is credible. At present, there are no construction-specific quality certifications and warranties, only <a href="https://www.propertyobserver.com.au/https://www.iso.org/standard/62085" target="_blank">generic standards such as the international ISO 9001: 2015</a>. And the administrative burden and costs of independent third-party certification make it unviable for many small companies. So instruments like ISO 9001 are likely of very limited value for effective signalling in the apartment sector.
The NSW Building Commissioner is supporting an industry rating system that will enable better signalling. Data mining will be used to identify risky players and <a href="https://www.theage.com.au/politics/victoria/phoenixing-in-crosshairs-amid-crackdown-on-dodgy-building-operators-20191028-p5351a" target="_blank">phoenix operators</a>. It should take effect in the apartment sector by 2021.
Screening involves buyers investing time and resources to uncover the likelihood of defects. This includes examining available records and the behaviours of sellers and their representatives. But this adds to buyers’ costs, which disadvantages them in the marketplace.
Stakeholders in the building development process should be compelled to release this information. NSW’s <a href="https://www.registrargeneral.nsw.gov.au/news/new-requirements-for-off-the-plan-contracts-from-1-december-2019" target="_blank">new law</a> on off-the-plan contract sales will increase sellers’ disclosure obligations and provide stronger protections for buyers. Importantly, sellers will have to identify material changes made during the development process at least 21 days before settlement.
A similar requirement involving an independent expert building inspection would help buyers better understand the risk of defects before they finalise their purchase.
Another positive move is the requirement in the new <a href="https://www.fairtrading.nsw.gov.au/consultation-tool/design-and-building-practitioners-bill-2019" target="_blank">Design and Building Practitioners Bill</a> for declared designs and as-built drawings to be lodged with the government. The Building Commissioner has said these will be made available on an easy-to-access platform.
This would enable buyers to check information as the development progresses, before the crucial building handover. It’s a step towards creating a “<a href="https://www.thefifthestate.com.au/columns/spinifex/new-nsw-building-legislation/" target="_blank">digital twin</a>” for everyone licensed to perform construction work, making it easier for the public to check their record.
While the devil is likely to be in the detail, the NSW government is on the right track in tackling the information asymmetry problem. However, the various information gatekeepers will still have to be persuaded – or required – to release information they have long withheld in their own interests.<img src="https://counter.theconversation.com/content/127007/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;">
<a href="https://theconversation.com/profiles/martin-loosemore-4690" target="_blank">Martin Loosemore</a>, Professor of Construction Management, <a href="http://theconversation.com/institutions/university-of-technology-sydney-936" target="_blank">University of Technology Sydney</a>; <a href="https://theconversation.com/profiles/bill-randolph-147968" target="_blank">Bill Randolph</a>, Director, City Futures Research Centre, Faculty of the Built Environment, <a href="http://theconversation.com/institutions/unsw-1414" target="_blank">UNSW</a>; <a href="https://theconversation.com/profiles/caitlin-buckle-399322" target="_blank">Caitlin Buckle</a>, PhD Candidate in Human Geography, <a href="http://theconversation.com/institutions/unsw-1414" target="_blank">UNSW</a>; <a href="https://theconversation.com/profiles/hazel-easthope-175163" target="_blank">Hazel Easthope</a>, Associate Professor, City Futures Research Centre, <a href="http://theconversation.com/institutions/unsw-1414" target="_blank">UNSW</a>, and <a href="https://theconversation.com/profiles/laura-crommelin-15376" target="_blank">Laura Crommelin</a>, Research Lecturer, City Futures Research Centre, <a href="http://theconversation.com/institutions/unsw-1414" target="_blank">UNSW</a>
This article is republished from <a href="http://theconversation.com" target="_blank">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/lack-of-information-on-apartment-defects-leaves-whole-market-on-shaky-footings-127007" target="_blank">original article</a>.
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j.ballantyne1990-6AQqhLzZaK

Lack of information on apartment defects leaves whole market on shaky footings

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Coles has sold their neighbourhood shopping centre, Coles Amaroo Village in Canberra.
Located in the northern suburbs of Canberra, the property was sold for $29.5 million on a net yield of 6.25 per cent (fully leased).
80% of the gross floor area in the centre is secured to Coles and Liquorland on a brand-new long-term lease. 
There are also eight specialty shops including a pharmacy, real estate agency, barber, Indian Grocer and various food offerings. 
The 4,594 sqm GLA centre was sold by Steven Lerche and Nic Purdue of Savills Australia and Philip Gartland of Stonebridge.
Savills Australia National Director of Retail Investments, Steven Lerche said “Amaroo Village is an outstanding convenience and non-discretionary retail hub, ideally located within the town centre. Collectively, we received over 230 enquiries and multiple bids, with the successful buyer being interstate." 
“The yield of 6.25% is consistent with other similar strata transactions around the country, confirming that the market for well leased convenience based retail property remains firmly on the investor radar” he said.   
“With interest rates continuing to drop, commercial property investment in Australia will remain attractive to both local and off shore capital. Investor demand will remain strong and property prices will hold firm” he said.
Savills Australia will be managing the shopping centre.
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Coles sells Amaroo Village Shopping in ACT for $29.5 million

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GUEST OBSERVATION
What do a billionaire, a former vice president, and a US democratic socialist have to do with Australia’s nearly three-decade run of economic growth?
More than you might think.
The race for the Democratic Party’s 2020 Presidential nomination is far from over – in fact voting in the first state (Iowa) doesn’t even begin until January. But Senator Elizabeth Warren has become the front-runner in betting markets and national polls, pulling ahead of former vice president Joe Biden.
Warren is running on a “democratic socialist” platform of banning private health insurance, imposing a wealth tax and more rigorously examining proposed trade agreements. Biden is much more centrist – he was Barack Obama’s vice president after all – but he is struggling to maintain the lead he once held.
This has a number of people freaked out. Among them is former New York mayor (and former Republican) Mike Bloomberg, who has filed paperwork to get himself into the Democratic primary race.
Bloomberg is a pro-market, socially liberal, three-term mayor of New York. He amassed a US$50 billion fortune by creating the category-killing <a href="https://www.bloomberg.com/company/stories/understanding-bloomberg-and-the-terminal/" target="_blank">Bloomberg terminal</a> for financial data and securities trading.
He has taken progressive stands on gun control, gay rights and women’s reproductive rights.
And on climate change he spent half a billion dollars on climate mitigation projects as well as campaigning with the environment group <a href="https://www.sierraclub.org/" target="_blank">Sierra Club</a> (successfully) for coal mines to be closed.
Bloomberg’s path to the Democratic nomination is far from assured, but in Australia someone like him would be in the mould of prime ministers past.
And that tells us something important about our internationally unusual long run of economic growth.
Straight down the middle
Since Bill Hayden became Labor (and opposition) leader in 1977 and put to rest the economic upheaval of the Whitlam era, Australia’s two major political parties have maintained, for the most part, staunchly centrist economic policies. They’ve combined the virtues of markets with a strong social safety set.
The <a href="https://theconversation.com/hawke-was-our-larrikin-but-also-our-reformer-117308" target="_blank">Hawke-Keating government famously opened up the Australian economy</a> to the world: floating the Australian dollar, deregulating the banking system, slashing tariffs, and privatising sleepy state-owned enterprises.
John Howard not only continued this legacy but introduced the Goods and Services Tax – a much more efficient form of taxation than had existed – and successfully negotiated the <a href="https://dfat.gov.au/trade/agreements/in-force/ausfta/Pages/australia-united-states-fta.aspx" target="_blank">Australia-US Free Trade Agreement</a>.
And though the Rudd-Gillard-Rudd government may have lacked stability, it did not lack major economic achievements.
Rudd and then Treasury boss Ken Henry <a href="http://research.economics.unsw.edu.au/richardholden/assets/did-labor-really-save-us-from-the-gfc-we-ask-an-expert.pdf" target="_blank">acted decisively with stimulus and bank guarantees</a> to avoid the economic disaster that hit most of the rest of the world.
<a href="https://images.theconversation.com/files/301692/original/file-20191114-77315-1hc4e9a.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/301692/original/file-20191114-77315-1hc4e9a.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=237&amp;fit=clip" alt=""></a>
Total annual greenhouse gas emissions excluding emissions from land use, land use change and forestry. <a class="source" href="https://www.theguardian.com/business/grogonomics/2018/jan/09/australias-emissions-are-rising-its-time-for-this-government-to-quick-pretending" target="_blank">Greg Jericho, Guardian</a>
Gillard introduced a carbon tax that had an almost immediate effect in reducing Australia’s emissions.
While the Abbott-Turnbull-Morrison government’s stance on climate change has been rightly criticised (often by yours truly), it has continued to enact free trade agreements, the most recent of which, the <a href="https://dfat.gov.au/trade/agreements/negotiations/rcep/Pages/regional-comprehensive-economic-partnership.aspx" target="_blank">Regional Comprehensive Economic Partnership</a>, might be <a href="https://theconversation.com/are-trumps-tariffs-legal-under-the-wto-it-seems-not-and-they-are-overturning-70-years-of-global-leadership-121425" target="_blank">truly transformational</a>.
Sometimes veering to the sides
Although that centrism has served Australia well socially and economically, there have been moments where policy looked like it would veer away from the centre.
Labor opposed the goods and services tax. The current government has flirted with government guarantees for new coal-fired power plants, which was a policy more in the spirit of Marx and Lenin than Howard and Costello.
Holding the centre
The current depressing state of the Australian economy (pun intended) might provide the biggest test yet to centrist economic policy.
Wage growth is sluggish (Wednesday’s figures showed annual growth slipping from a historically low <a href="https://www.smh.com.au/politics/federal/inextricably-linked-wage-growth-flatlines-as-report-shows-jobless-rate-hurting-economy-20191113-p53a94" target="_blank">2.3% to 2.2%</a>) and unemployment is climbing (Thursday’s figures showed the unemployment rate climbing from <a href="https://www.abs.gov.au/ausstats/abs@.nsf/Latestproducts/6202.0Main%20Features1Oct%202019?opendocument&amp;tabname=Summary&amp;prodno=6202.0&amp;issue=Oct%202019&amp;num=&amp;view=" target="_blank">5.2% to 5.3%</a>).
There’s pressure from both the left and the right to “do something”.
Cutting immigration, moving away from free trade, propping up failing industries, or offering selective wage rises to particular sectors (such as childcare workers) are among the “somethings” that have been on the table or partially implemented.
The Hawke-Keating and Howard-Costello governments sustained centrist economic policy for more than two decades.
They did it not only through a series of sound policy choices, but also through a narrative about the virtues of markets coupled with a social safety net.
It’s a narrative under threat. In Australia it hasn’t been drowned out yet.<img src="https://counter.theconversation.com/content/126918/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;">
Richard Holden, Professor of Economics, UNSW.
This article is republished from <a href="http://theconversation.com" target="_blank">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/vital-signs-might-straight-down-the-middle-be-the-source-of-our-economic-success-126918" target="_blank">original article</a>.
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Might straight down the middle be the source of our economic success?

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GUEST OBSERVATION
Around the world, the vast majority of people are flocking to cities not to dwell in their centres but to live in the new suburbs expanding their outer limits.
Reflecting this, from 2000 to 2015, the <a href="https://unstats.un.org/sdgs/report/2017/goal-11/" target="_blank">expansion of urbanised land worldwide outpaced urban population growth</a>. The result is <a href="https://unstats.un.org/sdgs/report/2017/" target="_blank">unprecedented urban sprawl</a>.
Expansive suburbs of single-family, freestanding housing are ubiquitous in countries such as Australia, the US and the UK. Most Australians still <a href="https://theconversation.com/becoming-more-urban-attitudes-to-medium-density-living-are-changing-in-sydney-and-melbourne-84693" target="_blank">aspire to own a large detached house</a> in the suburbs.
Public resistance to so-called infill development is unlikely to be overcome without a major change in how cities approach urban densification. We <a href="https://www.propertyobserver.com.au/https://www.springer.com/gp/book/9783030296001" target="_blank">advocate greenspace-oriented development</a>, or GOD, which provides substantial, public green spaces to serve surrounding higher-density neighbourhoods.
<a href="https://images.theconversation.com/files/299805/original/file-20191101-187907-jwuiia.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/299805/original/file-20191101-187907-jwuiia.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a>
Greenspace-oriented development correlates urban densification with significant, upgraded public green spaces. Author provided
We love our leafy suburbs
The “Australian dream” of owning your own home is often automatically associated with a detached house on a block of land. It’s seen as a mark of having “made it”.
For instance, a <a href="http://www.dhw.wa.gov.au/News/Pages/hwc.aspx" target="_blank">study in Perth</a> found that, if they had the money, 79% of people would prefer a separate dwelling and 13% a semi-detached option. Only 7% preferred flats, units or apartments.
Evidently, the suburban dream runs deep in the Australian cultural psyche. Australia is not alone in this. As a result of widespread preference for suburban living, globally we are not in the age of urbanisation but rather the age of suburbanisation.
Despite the enduring popularity of suburban life, several emerging crises threaten its dominance. These include the <a href="https://theconversation.com/to-protect-fresh-food-supplies-here-are-the-key-steps-to-secure-city-foodbowls-114085" target="_blank">destruction of agriculturally productive</a> and <a href="https://theconversation.com/squandering-riches-can-perth-realise-the-value-of-its-biodiversity-63933" target="_blank">biodiverse land</a> around expanding cities, <a href="https://theconversation.com/australian-city-workers-average-commute-has-blown-out-to-66-minutes-a-day-how-does-yours-compare-120598" target="_blank">ballooning commuting times</a> and service and public transport <a href="https://www.macrobusiness.com.au/2019/08/australian-infrastructure-expensive/" target="_blank">infrastructure costs</a>, and the <a href="https://theconversation.com/private-renters-are-doing-it-tough-in-outer-suburbs-of-sydney-and-melbourne-120427" target="_blank">concentration of socio-economic vulnerabilities</a> in outer suburbs. These areas also <a href="https://theconversation.com/living-liveable-this-is-what-residents-have-to-say-about-life-on-the-urban-fringe-111339" target="_blank">have poorer access</a> to jobs.
<img src="https://images.theconversation.com/files/299804/original/file-20191101-187938-1d9yuix.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt="">
The problems of sprawl: contractors clear once biodiverse land on the edge of Perth for a new suburb. Author provided. Photo courtesy of Donna Broun, Richard Weller
Why infill efforts are failing
To limit urban sprawl, the emphasis in most cities worldwide is on increasing urban density. In pursuit of infill development, planning strategies have focused mostly on <a href="http://www.tod.org/" target="_blank">transit-oriented development</a>. This approach focuses on higher-density development around public transport nodes and corridors.
Despite the widespread adoption of this ideology in Australia, many cities are <a href="https://dusp.mit.edu/publication/infinite-suburbia" target="_blank">not achieving</a> their <a href="https://uwap.uwa.edu.au/products/made-in-australia-the-future-of-australian-cities" target="_blank">infill targets</a>. In part, this is because transit-oriented development strategies suggest an “<a href="https://onlinelibrary.wiley.com/doi/full/10.1111/j.1745-5871.2006.00374.x" target="_blank">inflexible, over-neat vision</a>” of cities at odds with their “increasing geographical complexity”.
Much of the infill that has been achieved is through indiscriminate and opportunistic subdivision of individual suburban lots by “mum and dad” investors. This “<a href="https://www.tandfonline.com/doi/abs/10.1080/07293682.2016.1245201" target="_blank">background infill</a>” fails to achieve infill targets, does not reduce car use, erodes urban forests, and aggravates local communities. This has led to community resistance (the <a href="https://www.britannica.com/topic/Not-in-My-Backyard-Phenomenon" target="_blank">NIMBY</a> factor) and what one council official referred to as a “<a href="https://grattan.edu.au/report/city-limits-why-australias-cities-are-broken-and-how-we-can-fix-them/" target="_blank">public sullenness</a>”.
Higher density with a green focus
The principles of transit-oriented development are well established and valid. However, we <a href="https://www.propertyobserver.com.au/https://www.springer.com/gp/book/9783030296001" target="_blank">contend</a> that we need a complementary strategy, greenspace-oriented development, for achieving infill development. This approach would correlate urban densification with substantial, upgraded public green spaces or parks that are relatively well served by public transport.
Greenspace-oriented development builds upon the now well-recognised <a href="https://theconversation.com/higher-density-cities-need-greening-to-stay-healthy-and-liveable-75840" target="_blank">array of benefits</a> of green spaces for urban dwellers. Most importantly, it underpins approaches to making our cities more sustainable and liveable.
Australian suburbs do generally contain a reasonable number of parks. But these are typically underdesigned and underused. Many parks offer minimal amenity, often little more than large stretches of irrigated lawn and a scattering of trees.
<a href="https://images.theconversation.com/files/299807/original/file-20191101-102207-1w2nlod.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/299807/original/file-20191101-102207-1w2nlod.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a>
Before and after: in greenspace-oriented development, density and natural amenity are interwoven. Images courtesy of Robert Cameron. Author provided
We suggest redesigning parks to increase the naturalness, ecological function and diversity of active and passive recreational uses, which in turn can support higher-density urban areas. Indeed, it should increase the value of neighbouring real estate. With rezoning, this should enable greater local densification that is both commercially viable for developers and more attractive for residents.
Residents would then have an incentive to support well-designed infill development. When completed, each of these upgraded parks operates as a multifunctional, communal “backyard” for residents of a surrounding higher-density urban precinct.
<a href="https://images.theconversation.com/files/299806/original/file-20191101-102182-1ncjsyg.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/299806/original/file-20191101-102182-1ncjsyg.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a>
Before and after: parks become multifunctional communal ‘backyards’ for people living at a higher density around the park. Author provided
The lure of suburbia clearly remains strong for people around the world. If planners are to deal with the problems of sprawl, they need to increase urban density in a way that resonates with the leafy green qualities of suburbia that most people desire (at very least in Australia).
Transit-oriented development ideology relies on a false presumption that residents will trade the benefits of nature for the benefits of urbanity. We require a new vision of urban densification that responds to the urban, societal and ecological challenges of the 21st century and aligns with people’s preference for suburban living near nature.<img src="https://counter.theconversation.com/content/126204/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;">
Julian Bolleter, Deputy Director, Australian Urban Design Research Centre, University of Western Australia.
Cristina E. Ramalho, Research fellow, University of Western Australia.<a href="http://theconversation.com/institutions/university-of-western-australia-1067" target="_blank"></a>
This article is republished from <a href="http://theconversation.com" target="_blank">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/god-save-us-greenspace-oriented-development-could-make-higher-density-attractive-126204" target="_blank">original article</a>.
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Greenspace-oriented development could make higher density attractive

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GUEST OBSERVATION
It is difficult to make predictions, especially about the future. (attributed to Danish physicist Niels Bohr)
The difficulty of making predictions has long been known, but the rise of the internet means that it is getting harder to hide the gaps between predictions and reality.
Perhaps the most significant example of repeated failed projections has been the International Energy Agency’s projections of the importance of renewable power – the proportion of electricity generated by solar and wind and other renewable sources other than hydro.
Beginning in 1994, when generation from these sources was negligible, the Agency has produced estimates of the future share of renewables every two years.
Every two years, with striking regularity, the previous estimates have been exceeded (hugely) and the new set has been revised upwards. But never by enough. Each time the upward revision has been inadequate.
This graph, prepared by <a href="https://www.quora.com/q/xwpxpfefwalgifkr/A-modest-proposal-to-the-International-Energy-Authority" target="_blank">Paul Mainwood</a> from IEA reports, illustrates the point:
Projections versus reality
<a href="https://images.theconversation.com/files/302056/original/file-20191117-66945-19v9ijz.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/302056/original/file-20191117-66945-19v9ijz.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a>
Reality versus repeated projections of renewables share of electricity generation (ex hydro). <a class="source" href="https://www.quora.com/q/xwpxpfefwalgifkr/A-modest-proposal-to-the-International-Energy-Authority" target="_blank">Paul Mainwood, Quora</a>
The dashed lines represent successive projections from 1994 to 2016.
The solid red line represents the actual growth of non-hydro renewables as a share of total electricity generation.
What can be seen is that eleven times in a row the projected growth in renewables was far too low and had to be upgraded. Eleven times in a row the upgrades weren’t big enough.
As a joke (indicated by the green line) Mainwood “corrected” the 2016 projection for the typical under-projection:
Projections plus “corrected” 2016 projection
<a href="https://images.theconversation.com/files/302067/original/file-20191117-66953-1tfh6u0.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/302067/original/file-20191117-66953-1tfh6u0.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a>
Reality versus projections of renewables share of electricity generation (ex hydro) plus 2016 projection corrected for typical undershoot. <a class="source" href="https://www.quora.com/q/xwpxpfefwalgifkr/A-modest-proposal-to-the-International-Energy-Authority" target="_blank">Paul Mainwood</a>
Projections often understate change
Another striking example relates to religious belief. In 2015 the Pew Research Institute released a <a href="https://www.pewforum.org/2015/04/02/religious-projections-2010-2050/" target="_blank">report</a> suggesting a gradual decline in Christianity in the United States.
The headline finding for the US:
"Christians will decline from more than three-quarters (75%) of the population in 2010 to two-thirds (66%) in 2050."
Yet only four years later in 2019, Pew released another report with this headline finding about the US:
'In 2018 and 2019, 65% of American adults describe themselves as Christians when asked about their religion, down 12 percentage points over the past decade."
Thus, a decline expected to take forty years had taken place inside ten.
Moreover, Christian affiliation is highest in the older age cohorts, very few members of which will be around in 2050. Looking at the younger cohort born after 1981, only 49% claim a Christian affiliation, a proportion that has declined by 16 percentage points in a decade. Unless that trend is rapidly reversed, or later cohorts experience a religious revival, Christians will be a minority well before 2050.
They enable modellers to escape responsiblity
Faced with outcomes of this kind, modellers often defend themselves by drawing a distinction between “predictions” and “projections”.
A prediction (Latin for “foretelling”) is a claim about what is most likely to happen in the future. By contrast, a projection (“casting forward”) is a model output derived by extrapolating past trends, holding some parameters constant and allowing others to vary.
The International Energy Agency projections were characterised by the assumption that the costs of renewable energy would change only slowly, rather than continuing the extraordinary decline that began in the 1970s.
In the case of the Pew projections, the crucial parameter is conversion rates – the frequency with which people brought up with one religion (including “no religion”) change to another. The Pew projections were based on the assumption conversion rates will remain unchanged.
It is the opposite of the widely-held but controversial “secularisation hypothesis” which states that modernisation leads to increased conversions to “no religion”.
Predictions force them to take responsibility
Projections are useful in the development of models. All models are based on past experience and have to assume that in some respects the future will be like the past. By examining the projections generated under particular assumptions about which variables and parameters will remain constant, it is possible to understand how models works and make modelling choices.
But projections of this kind are of no use in informing people not familiar with the material. They mislead casual readers of the Australia’s budget.
The budget uses both predictions and projections.
For the two years following each budget the Commonwealth uses “forecasts” which it is prepared to stand by, then for the next two it presents mechanical “projections”:
<img src="https://images.theconversation.com/files/302072/original/file-20191117-66957-w8vxaq.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt="">
<a class="source" href="https://www.budget.gov.au/2019-20/content/bp1/index.htm" target="_blank">2019-20 Commonwealth budget, Budget Paper 1</a>
When asked to defend (for example) its wage growth number of 3½%, the treasury points out that it is a mechanical projection rather than a forecast, a distinction lost on all but the most enthusiastic of budget devotees.
In practice it is impossible to separate the two.
Even though both the International Energy Association and Pew describe their estimates as “projections” they are almost invariably <a href="https://www.mining.com/new-iea-report-predicts-surge-in-global-coal-use-2/" target="_blank">treated as</a> <a href="https://www.pri.org/stories/future-religion-around-world-one-chart" target="_blank">predictions</a>. 
Since any statement about the future will be treated as a prediction, the only serious option for modellers prepared to be truthful with the public is to bite the bullet and make predictions.
It means working hard to make the best possible estimate of the future paths of all model parameters, and using judgement to take account of everything else.
It’s what those of us looking to experts for guidance deserve.<img src="https://counter.theconversation.com/content/126734/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;">
John Quiggin, Professor, School of Economics, The University of Queensland.
This article is republished from <a href="http://theconversation.com" target="_blank">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/please-no-more-projections-what-we-need-are-predictions-and-theyre-harder-126734" target="_blank">original article</a>.
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Please, no more projections. What we need are predictions, and they’re harder

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GUEST OBSERVATION
Concrete is the most widely used man-made material, commonly used in buildings, roads, bridges and industrial plants. But producing the Portland cement needed to make concrete accounts for 5-8% of all global greenhouse emissions.
There is a more environmentally friendly cement known as MOC (magnesium oxychloride cement), but its poor water resistance has limited its use – until now. We have developed a water-resistant MOC, a “green” cement that could go a long way to cutting the construction industry’s emissions and <a href="https://gccassociation.org/sustainability-innovation/" target="_blank">making it more sustainable</a>.
Producing a tonne of conventional cement in Australia emits about <a href="https://www.researchgate.net/publication/267233444_SCM's_potential_to_lower_Australia's_greenhouse_gas_emissions_profile" target="_blank">0.82 tonnes of carbon dioxide</a> (CO₂). Because most of the CO₂ is released as a result of the chemical reaction that produces cement, <a href="https://www.carbonbrief.org/qa-why-cement-emissions-matter-for-climate-change" target="_blank">emissions aren’t easily reduced</a>. In contrast, MOC is a different form of cement that is carbon-neutral.
<a href="https://images.theconversation.com/files/301205/original/file-20191112-178520-1o0tfjn.PNG?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/301205/original/file-20191112-178520-1o0tfjn.PNG?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a>
Global CO₂ emissions from rising cement production over the past century (with 95% confidence interval). <a href="https://www.earth-syst-sci-data.net/10/195/2018/" target="_blank">Source: Global CO2 emissions from cement production, Andrew R. (2018)</a>, <a href="http://creativecommons.org/licenses/by/4.0/" target="_blank">CC BY</a>
What exactly is MOC?
MOC is produced by mixing two main ingredients, magnesium oxide (MgO) powder and a concentrated solution of magnesium chloride (MgCl₂). These are byproducts from magnesium mining.
<a href="https://images.theconversation.com/files/301216/original/file-20191112-178498-1i9iftz.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/301216/original/file-20191112-178498-1i9iftz.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a>
Magnesium oxide (MgO) powder (left) and a solution of magnesium chloride (MgCl₂) are mixed to produce magnesium oxychloride cement (MOC). Author provided
Many countries, including China and Australia, have plenty of magnesite resources, as well as seawater, from which both MgO and MgCl₂ could be obtained.
Furthermore, <a href="https://pubs.acs.org/doi/pdf/10.1021/acs.chemrev.5b00463" target="_blank">MgO can absorb CO₂ from the atmosphere</a>. This makes MOC a truly green, carbon-neutral cement.
MOC also has many superior material properties compared to conventional cement.
Compressive strength (capacity to resist compression) is the most important material property for cementitious construction materials such as cement. MOC has a much higher compressive strength than conventional cement and this impressive strength can be achieved very fast. The fast setting of MOC and early strength gain are very advantageous for construction.
Although MOC has plenty of merits, it has until now had poor water resistance. Prolonged contact with water or moisture severely degrades its strength. This <a href="https://onlinelibrary.wiley.com/doi/abs/10.1002/suco.201800077" target="_blank">critical weakness has restricted its use</a> to indoor applications such as floor tiles, decoration panels, sound and thermal insulation boards.
How was water-resistance developed?
A team of researchers, led by Yixia (Sarah) Zhang, has been working to develop a water-resistant MOC since 2017 (when she was at UNSW Canberra).
<a href="https://images.theconversation.com/files/301217/original/file-20191112-178494-1jalea4.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/301217/original/file-20191112-178494-1jalea4.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=237&amp;fit=clip" alt=""></a>
Adding industrial byproducts fly ash (above) and silica fume (below) improves the water resistance of MOC. Author provided
<a href="https://images.theconversation.com/files/301393/original/file-20191112-178511-1he0duz.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/301393/original/file-20191112-178511-1he0duz.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=237&amp;fit=clip" alt=""></a>
To improve water resistance, the team added industrial byproducts such as fly ash and silica fume to the MOC, as well as chemical additives.
Fly ash is a byproduct from the coal industry – there’s plenty of it in Australia. Adding fly ash significantly improved the water resistance of MOC. Flexural strength (capacity to resist bending) was fully retained after soaking in water for 28 days.
To further retain the compressive strength under water attack, the team added silica fume. Silica fume is a byproduct from producing silicon metal or ferrosilicon alloys. When fly ash and silica fume were combined with MOC paste (15% of each additive), full compressive strength was retained in water for 28 days.
Both the fly ash and silica fume have a similar effect of filling the pore structure in MOC, making the cement denser. The reactions with the MOC matrix form a gel-like phase, which contributes to water repellence. The extremely fine particles, large surface area and high reactive silica (SiO₂) content of silica fume make it an effective binding substance known as a <a href="https://concretecountertopinstitute.com/free-training/the-use-of-pozzolans-in-concrete/" target="_blank">pozzolan</a>. This helps give the concrete high strength and durability.
<a href="https://images.theconversation.com/files/301218/original/file-20191112-178498-1kb1a8v.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/301218/original/file-20191112-178498-1kb1a8v.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a>
Scanning electron microscope images of MOC showing the needle-like phases of the binding mechanism. Author provided
Although the MOC developed so far had excellent resistance to water at room temperature, it weakened fast when soaked in warm water. The team worked to overcome this by using inorganic and organic chemical additives. Adding phosphoric acid and soluble phosphates greatly improved warm water resistance.
<a href="https://images.theconversation.com/files/301219/original/file-20191112-178516-1qpuacx.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/301219/original/file-20191112-178516-1qpuacx.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=237&amp;fit=clip" alt=""></a>
Examples of building products made using MOC. Author provided
Over three years, the team has made a breakthrough in developing MOC as a green cement. The strength of concrete is rated using megapascals (<a href="https://www.hunker.com/12304046/definition-of-concrete-mpa" target="_blank">MPa</a>). The MOC achieved a compressive strength of 110 MPa and flexural strength of 17 MPa. These values are a few times <a href="https://infostore.saiglobal.com/preview/is/en/2011/i.s.en197-1-2011.pdf?sku=1492629" target="_blank">greater than those of conventional cement</a>.
The MOC can fully retain these strengths after being soaked in water for 28 days at room temperatures. Even in hot water (60˚C), the MOC can retain up to 90% of its compressive and flexural strength after 28 days. The values remain as high as 100 MPa and 15 MPa respectively – still much greater than for conventional cement.
Will MOC replace conventional cement?
So could MOC replace conventional cement some day? It seems very promising. More research is needed to demonstrate the practicability of uses of this green and high-performance cement in, for example, concrete.
When concrete is the main structural component, steel reinforcement has to be used. Corrosion of steel in MOC is a critical issue and a big hurdle to jump. The research team has already started to work on this issue.
If this problem can be solved, MOC can be a game-changer for the construction industry.
Yixia (Sarah) Zhang, Associate Professor of Engineering, Western Sydney University. 
Khin Soe, Research Associate, School of Computing, Engineering and Mathematics, Western Sydney University.
Yingying Guo, PhD Candidate, School of Engineering and Information Technology, UNSW.
This article is republished from <a href="http://theconversation.com" target="_blank">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/green-cement-a-step-closer-to-being-a-game-changer-for-construction-emissions-126033" target="_blank">original article</a>.
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Green cement a step closer to being a game-changer for construction emissions

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A two-level penthouse in Kew, Victoria with views across the Yarra Valley to the Northern Ranges has hit the market with $3.9 million to $4.29 million hopes. 
Designed by David Watson Architect, the apartment at 5/33 Stawell Street is one of just five custom-built residences in a boutique setting.
<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/2019/10/23/kew%202.jpg" alt="">
The home comprises main bedroom with dress room, two further bedrooms, north-facing living zones, stone kitchen and balcony. 
Other features include double glazed windows, study workstation, ducted heating/cooling, designer lighting, and three basement car spaces plus storage cage.
<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/2019/10/23/kew%203.jpg" alt="">
The building comes with a 136 sqm terrace with heated swimming pool.
Located just metres to the tranquil Yarra River, the penthouse is close to Kew Junction restaurants and shops, trams, schools, EastLink freeway, and parklands.
<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/2019/10/23/kew%204.jpg" alt="">
Geoff Hall and Daniel Bradd of Kay &amp; Burton Hawthorn have the listing. 
The property had been scheduled for private auction on November 19, but this has been pushed back to December 3. 
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Two level Kew penthouse with valley and mountain views listed 

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EXPERT OBSERVER
Aussie consumers remain downbeat. In fact, the weekly ANZ-Roy Morgan consumer sentiment index is down by 4.1 per cent between June 9 and November 17 2019 – the period in which interest rates have been lowered three times to a record low 0.75 per cent. Last week, the release of disappointing job and wage reports served to highlight the sense of unease Aussies are currently feeling about the economy. In fact, consumer views on ‘current’ economic conditions are now at the lowest level since April 23 2017.
While ultra-low interest rates are currently working their way through the economy and showing up primarily in rising capital city home prices, although rising unemployment, tepid pay rises and still-elevated household debt continue to restrain consumer spending intentions.
According to Commonwealth Bank (CBA) and Google trends searches data, measured household spending intentions edged higher in October. The modest upturn signals a potential improvement in consumer spending in the lead up to online retail shopping events - Black Friday and Cyber Monday - later this month, ahead of the all-important Christmas trading period.
The CBA gauge also revealed that consumer spending intentions on entertainment and travel are positive, suggesting that households are still keen to deploy their hard-earned coin on ‘pleasure pursuits’. But gyms and car dealerships remain under pressure as consumers’ rein-in non-essential spending on goods and services.
The rebound in home prices continues. The CoreLogic 5-Capital City Daily Home Value Index is up by 1.2 per cent so far in November, led by gains in Sydney (up 1.8 per cent), Melbourne (up 1.2 per cent) and Brisbane/Gold Coast (up 0.5 per cent). The lift in housing demand, supply constraints and record-low borrowing costs are pushing-up home prices – so it’s no surprise that home buying intentions are near record highs in early 2017, according to CBA Group economists.
What do the figures show? Consumer Sentiment
The weekly ANZ-Roy Morgan consumer confidence rating fell by 1.1 per cent to 109.9 points. Sentiment is below both the average of 114.3 points held since 2014 and the longer term average of 113.1 points held since 1990.
Three of the five major components of the index rose last week:
1. The estimate of family finances compared with a year ago was up from +10.6 points to +10.9 points;
2. The estimate of family finances over the next year was up from +25.6 points to +25.8 points;
3. Economic conditions over the next 12 months was down from -7.0 points to -9.4 points;
4. Economic conditions over the next 5 years was down from +6.0 points to +0.8 points;
5. The measure of whether it was a good time to buy a major household item was up from +20.6 points to +21.1 points.
The measure of inflation expectations was down from 4.1 per cent to 3.8 per cent.
The CBA Household Spending Intentions Series (HSI) – October
On home buying intentions: “Home buying intentions rose further in October and are now close to the record highs seen in H1 2017. Current HSI readings are consistent with an ongoing pick up in dwelling prices. And also consistent with a turn in leading indicators of residential construction like building approvals.”
On retail spending intentions: “Retail spending intentions are bouncing around at present but the lift in October means a modest uptrend is in place.”
On travel spending intentions: “Travel spending intentions are turning up, albeit from low levels. The trend in Australian residents holidaying overseas has slowed. The pick-up in the Travel HSI may be an indication that a lower AUD [Aussie dollar] is encouraging domestic holidays instead.”
On health &amp; fitness spending intentions: “Intentions to spend on health &amp; fitness have levelled out. Households are willing to allocate scarce disposable income to driving health &amp; fitness spending with little impact from the vagaries of the economic cycle.”
On education spending intentions: “Education spending intentions are high and rising. Policy makers and economic commentators can all see the need to lift productivity growth.”
On motor vehicle spending intentions: “Motor vehicle purchase intentions remain deep in negative territory. And the tentative signs of a turn up in the past few months have stalled.”
Reserve Bank November 5 Board minutes
Last paragraph – easing bias retained: “The Board concluded that the cash rate should be held steady at this meeting. As part of their deliberations, members also agreed that it was reasonable to expect that an extended period of low interest rates would be required in Australia to reach full employment and achieve the inflation target. The Board would continue to monitor developments, including in the labour market, and was prepared to ease monetary policy further if needed to support sustainable growth in the economy, full employment and the achievement of the inflation target over time.”
A rate cut was considered by the Board: “The Board agreed that a case could be made to ease monetary policy at this meeting…”
Impact on consumer confidence and savers: “While members judged that lower interest rates were supporting the economy through the usual transmission channels (including a lower exchange rate, higher asset prices and higher cash flows for borrowers), they recognised the negative effects of lower interest rates on savers and confidence. They also discussed the possibility that a further reduction in interest rates could have a different effect on confidence than in the past, when interest rates were at higher levels.”
Stimulus is working its way through the economy: “The established housing market was picking up, which would have positive spillovers for the broader economy, although the size of these spillovers was uncertain. Further evidence on spending by households was required before drawing a conclusion on the effects of the tax cuts and low interest rates. Having already delivered a substantial monetary stimulus in recent months, there was a case to wait and assess the effects of this stimulus, especially given the long and variable lags.”
Interest rate pause?: “The most appropriate approach would be to maintain the current stance of monetary policy and to make another full assessment once more evidence of the effects of the earlier monetary easing had become available.”
‘Gentle turning point’ reiterated: “The outlook for the Australian economy was little changed since August. After a soft period in the second half of 2018, GDP growth had picked up a little in the first half of 2019 and it appeared that a gentle turning point had been reached. Looking forward, growth was expected to strengthen gradually to 2¾ per cent over 2020 and around 3 per cent over 2021.”
On the job market: “The unemployment rate had remained steady at around 5¼ per cent and was expected to decline only gradually. Spare capacity was likely to remain in the labour market for some years.”
On inflation: “Inflationary pressures had remained subdued, held down by very low housing-related prices and slow growth in labour costs and administered prices.”
On the global economy: “Global financial markets were signaling a decline in pessimism, which, if sustained could lead to better-than-expected outcomes for the global economy.”
Financial markets pricing of future rate cuts: “Financial market pricing implied that expectations for a further reduction in the cash rate had been scaled back since the previous meeting, with some chance of a 25 basis point reduction around the middle of 2020.”
What are the implications for interest rates and investors?
According to the Reserve Bank Board’s minutes – released today - policymakers considered another rate cut at their meeting in early November. The Board, however, opted to ‘sit pat’, instead cautioning that “they recognised the negative effects of lower interest rates on savers and confidence.” And in light of its diminishing conventional monetary policy ammunition, Board members also emphasised that, “Having already delivered a substantial monetary stimulus in recent months, there was a case to wait and assess the effects of this stimulus, especially given the long and variable lags.”
That said, the Reserve Bank has retained its policy easing bias. Further evidence of a continuing loss of momentum in the job market could be the catalyst for another rate cut. In fact, Board members concede that “spare capacity is likely to remain in the labour market for some years” with little progress expected to be made boosting Aussies pay packets – two essential ingredients for an improvement in consumer spending and a pick-up in inflation.
CommBank Group economists have pencilled in an interest rate cut in February 2020, but view further fiscal initiatives as being more effective in delivering additional support for the economy.
RYAN FELSMAN is a Senior Economist at CommSec
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Consumer views on the economy hit two and a half year low: CommSec's Ryan Felsman

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Former Western Sydney NAB branch manager, Mathew Alwan, has been sentenced to 12 months imprisonment to be served by way of Intensive Corrections Order (ICO) for making false and misleading statements to NAB in relation to 24 home loan applications.
Mr Alwan had previously pleaded guilty to an ‘intention to defraud by false or misleading statement’ charge after he told NAB that an introducer had referred borrowers to make loan applications. In reality, the NAB introducer was Mr Alwan’s uncle, operating under the business name ‘Suit Club’. 
The fraud occurred between October 2013 and September 2015 and resulted in NAB paying Suit Club $56,995 in commissions.
ASIC has taken further action regarding NAB’s Introducer Program, launching civil proceedings in the Federal Court against NAB in August 2019.
As part of the ICO Mr Alwan will undertake 200 hours of community service and ongoing rehabilitation treatment.
ASIC has permanently banned Mr Alwan from providing financial services.
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Former NAB branch manager sentenced for making false and misleading statements

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A Manly home has sold at weekend auction for $3,116,000.
The residence sits at 12 Iluka Avenue which comprises 372 square metres. 
It features two bedrooms, a single bathroom, a carport, office, and a large level lawn.
Manly beach is 450 metres from the listing.
Ray White Freshwater agent Jacquelynn Watson and Andre de Ruyter managed the sale. 
 “The highest offer we had prior to auction was $2,450,000, and the bidding actually started $100,000 above that prior offer, we then went on to receive over 80 more bids before the hammer fell. “We had more than 200 people through the opens - everyone from builders and trades people through to families and downsizers - and it was a local family who were the lucky winning bidders. “This wonderful home combines the classic scale and characteristics of its 1940's origins with superb potential and the beachside location made it a wonderful offering.”
Manly's median house price is $2,825,650.
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Manly home on Iluka Avenue sells for over $3 million

For most new apartment buildings, the Owners Corporation starts life with little more than a bank account and the first quarterly strata levies.

At <a href="https://www.apartments.com.au/buildings/9-gay-street-castle-hill-9-gay-street-castle-hill-nsw-2154">9 Gay Street</a> in <a href="https://www.apartments.com.au/developments/castle-hill-nsw-2154">Castle Hill</a>, it starts with around $7 million in reserve.

It's an unusual legacy of what was once one of Sydney's highest-profile apartment remediation projects. When the development, originally known as Skyview and built by disgraced developer Top Place, came under scrutiny by then NSW Building Commissioner David Chandler, an $11 million remediation bond was negotiated to ensure any building defects could be fully rectified.

The building underwent an 18-month remediation program, during which around $4 million of that bond was spent bringing the building up to the standard it should have been in from the outset.

After extensive inspections, all active rectification orders have been lifted. What's more, around $7.2 million remains secured for the Owners Corporation for the next 15 years.

In a twist few would have predicted, what began as a significant concern for purchasers has left the building with something almost unheard of in the apartment market: a multi-million-dollar financial reserve from day one.

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<a href="https://www.apartments.com.au/project-marketer/equitifund-group">Equitifund</a> Executive Chairman Greg Huxley said the structure offers buyers a level of certainty that is difficult to replicate.

"The $11 million bond established for the Skyview Castle Hill development represents exceptional value, providing genuine financial security for purchasers," Huxley said.

"Unlike a standard insurance policy, this bond consists of real funds held in trust for the Owners Corporation, offering a tangible layer of protection and added peace of mind."

The apartments themselves have been designed with a focus on practical, contemporary living. Interiors feature Smeg appliances, stone benchtops, tiled living areas, carpeted bedrooms, 2.7-metre ceilings, floor-to-ceiling glazing, and ducted heating and cooling throughout.

Residents also have access to a range of shared amenities, including two rooftop barbecue areas, a swimming pool, children's playgrounds, secure building access, storage cages, and visitor parking.

The location continues to be one of the project's strongest drawcards. Castle Hill Metro Station sits virtually on the doorstep, providing direct connections across Sydney's expanding Metro network, while Castle Towers offers extensive retail, dining, entertainment, and service amenities within walking distance.

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The building, now named after its location at 9 Gay Street, comprises a diverse mix of one-, two-, and three-bedroom apartments starting from just under $600,000.

Equitifund National Sales Director Ben Hamblett said demand in the Hills District continues to be driven by buyers seeking convenience and connectivity.

"Interest from both owner-occupiers and investors in Castle Hill remains exceptionally strong, with buyers consistently prioritising developments in close proximity to the Metro station and Castle Towers Shopping Centre," Hamblett said.

"There is a clear trend in the market, with purchasers seeking convenient access to transport and lifestyle amenities that support a seamless, low-maintenance way of living."

On top of the long-term protection afforded by the remaining $7.2 million bond, Equitifund is offering a limited-time stamp duty rebate on selected apartments.

Eligible purchasers can also secure finance options, including a 3.99 per cent two-year variable rate, loan-to-value ratios of up to 90 per cent, and interest-only lending options through EquitiCredit.

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Joel Robinson

Why this Castle Hill apartment building starts with a $7 million advantage

For much of the past few years, conversations about Australia's property market have centred on the rapid growth seen in Sydney, Brisbane, Gold Coast, and Perth. <a href="https://www.apartments.com.au/developments/melbourne-vic-3004">Melbourne</a> has followed a different trajectory.

That relative underperformance is now encouraging some buyers to reassess the city, particularly those willing to look beyond short-term market movements and focus on quality property in established locations, along with the long-term growth prospects of a city expected to overtake Sydney as Australia’s most populous.

John Bekiaris, Research &amp; Market Insights at <a href="https://www.apartments.com.au/project-marketer/equitifund-group">Projects by Equitifund</a>, said Melbourne's current position is attracting increasingly sophisticated purchasers.

"Melbourne continues to present one of Australia's strongest long-term investment stories," Bekiaris says.

"While other capital cities have experienced stronger recent growth, that relative underperformance is exactly what's attracting sophisticated counter-cyclical investors."

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Equitifund isn't just commenting on Melbourne's property market, it's investing in it.

The Sydney-headquartered capital partner has taken over the remaining apartments at <a href="https://www.apartments.com.au/buildings/victoriana-melbourne-20-queens-road-melbourne-vic-3004">Victoriana</a>, the recently completed glass-encased development opposite Albert Park Lake in Melbourne's tightly held St Kilda Road precinct.

Designed by <a href="https://www.apartments.com.au/architects/rothelowman">Rothelowman</a> and built by <a href="https://www.apartments.com.au/builders/hickory">Hickory</a>, Victoriana places residents between one of Melbourne's most recognised parklands and the CBD, offering oversized two and three-bedroom apartments aimed at owner-occupiers seeking a genuine alternative to a traditional family home.

The development comprises 232 completed residences alongside a suite of resident amenities, including a 25-metre indoor swimming pool, gymnasium, landscaped entertaining areas, resident lounges, EV charging, secure basement parking and a concierge-style arrival experience.

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The apartments have been designed with owner-occupiers firmly in mind.&nbsp;Open-plan living and dining areas flow onto generous balconies framing views across Albert Park Lake, Fawkner Park, the Royal Botanic Gardens and the Melbourne skyline.

Kitchens feature Gaggenau appliances, stone benchtops and generous preparation space. Bedrooms include built-in robes, while bathrooms feature full-height textured tiling. Hardwood flooring and ducted air conditioning complete residences designed for long-term living.

Rothelowman's architecture takes its cues from the landscape opposite the site. Sweeping horizontal glazing references the movement of Albert Park Lake, while generous balconies and expansive glazing strengthen the connection between the apartments and the surrounding parklands. The result is a building designed to deliver the scale and amenity expected of luxury apartment living, while offering the larger floorplans increasingly sought by owner-occupiers.

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The location is one of Victoriana's defining characteristics. Positioned on Queens Road, residents are directly opposite Albert Park Lake and within easy reach of Fawkner Park, the Royal Botanic Gardens, South Melbourne, St Kilda Road and the CBD. With few comparable development opportunities remaining in the precinct, buyers are increasingly placing value on outlooks that are unlikely to be interrupted by future construction.

Greg Huxley, Founder of Equitifund, believes those qualities become even more valuable over time.

"Premium real estate has always rewarded buyers who take a long-term view," Huxley said.

"Victoriana represents the kind of asset that's increasingly difficult to recreate today, particularly in an established location like Queens Road."

He said rising construction costs are also changing the way buyers assess completed developments.

"When you combine an irreplaceable location with thoughtful architecture and premium finishes, you create something that becomes increasingly difficult to reproduce as construction costs continue to rise."

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According to National Sales Director Ben Hamblett, enquiry has been driven largely by Melbourne downsizers and buyers upgrading from smaller apartments.

"Interest in Victoriana continues to build, with strong buyer focus on the larger owner-occupier residences within the development," Hamblett says.

"Enquiry is increasingly driven by local buyers who recognise the rarity of what's on offer: park-facing apartments in an established neighbourhood where new development opportunities are becoming increasingly scarce. At Victoriana, the view is not just a feature; it's an appreciating asset in its own right."

He said interstate enquiry has also strengthened as buyers reassess Melbourne's position within the national property cycle.

"Melbourne currently stands as the most compelling entry point of any major Australian capital, and discerning buyers are beginning to recognise what those who move early always understand: the best opportunities are taken before the price rise confirms them."

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Why now is the time to buy in Melbourne's premium apartment market

Developers and apartment buyers have a narrowing window of opportunity before Brisbane's Olympic infrastructure pipeline begins competing directly with residential construction, pushing up costs, tightening labour supply and making new projects increasingly difficult to deliver.

While Brisbane's apartment market continues to benefit from strong population growth and limited housing supply, industry research suggests the years leading up to 2027 could prove to be the most important period for developers looking to secure builders and buyers hoping to purchase before the next wave of price increases.

A new Colliers report, Brisbane 2032 Olympic and Paralympic Games: Creating Solutions, highlights the scale of the challenge. While thousands of new homes are planned across South East Queensland, the Brisbane Olympic Athletes Village alone will deliver more than 10,500 beds during the Games before being converted into around 1,750 to 2,000 apartments. Equivalent to almost two years of typical inner-city apartment supply, the project will also absorb a significant share of the construction workforce and building materials.

The broader construction pipeline paints an even clearer picture.

Construction Skills Queensland's Horizon 2032 report forecasts Queensland's annual construction pipeline will average $69 billion over the coming years before peaking at $75 billion in 2027-28. Demand for construction workers is expected to increase by 17 per cent to almost 150,000 people, with the industry facing an annual shortfall of around 19,000 workers that could blow out to as many as 35,000 during the peak construction period.

The Olympic venues, athletes village and supporting infrastructure will account for billions of dollars worth of work across South East Queensland through to 2032, creating intense competition for labour at a time when Australia's residential construction sector is already under pressure.

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Colliers Queensland Residential Director Andrew Scriven said the convergence of these projects is creating a clear window of opportunity for both developers and buyers.

"From 2027 onwards, the market will shift dramatically," Scriven said.

"Labour will increasingly be locked into government-led infrastructure and Olympic projects, which means private residential developments will face higher costs and tighter margins. The developers who move now are the ones most likely to get projects off the ground."

Scriven said the same dynamic would also affect buyers, with fewer apartment projects expected to launch once construction capacity tightens.

"If you're looking to change your lifestyle over the next five years, now is your window of opportunity to buy."

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Developers are already positioning themselves ahead of that window.

Following the success of Monarch at Toowong, Consolidated Properties is preparing to launch two new Brisbane apartment projects in the second half of 2026. They include <a href="https://www.apartments.com.au/new-apartments/gloriette-30-bedivere-street-yeerongpilly-qld-4105">Gloriette</a> at Yeerongpilly Green, a 25-storey tower within one of Brisbane's key Olympic precincts, and <a href="https://www.apartments.com.au/new-apartments/castile-47-skyring-terrace-newstead-qld-4006">Castile</a>, a recently approved 25-storey riverfront development at 47 Skyring Terrace in Newstead.

Hutchinson Builders will deliver both projects, with early works already underway at Yeerongpilly and Newstead expected to commence later this year.

The timing comes as Brisbane's fundamentals continue to strengthen, with strong interstate migration, population growth and vacancy rates remaining below 1.5 per cent.

Colliers Queensland researcher Pragya Sharma said Greater Brisbane is forecast to require around 40,000 new apartments between 2021 and 2031.

"There's a real mismatch emerging between when housing is needed and when it will be feasible to build," Sharma said.

"As a result, the period leading up to 2027 presents a key window of opportunity for developers to secure approvals, funding and construction capacity, while buyers will have greater choice before supply constraints intensify."

Colliers research outlines a critical pre-2027 window to start residential projects before labour squeeze: now is the time to buy

Developers, buyers on watch in South East Queensland ahead of construction crunch: Colliers

It's taken less than nine months for developer Sherpa Property Group to sell out all 51 apartments in its <a href="https://www.apartments.com.au/new-apartments/flourish-oasis-palm-beach-7-9-sixth-avenue-palm-beach-qld-4221">Flourish Oasis</a> development in <a href="https://www.apartments.com.au/developments/palm-beach-qld-4221">Palm Beach</a>, over a year before its anticipated completion.

&nbsp;

Located at 7-9 Sixth Avenue, the $67 million development has resonated strongly with both local owner-occupiers and downsizers seeking high-quality apartments within walking distance of the beach, dining precincts and everyday amenities.

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Christie Leet, Founder of <a href="https://www.apartments.com.au/developers/sherpa-property-group">Sherpa Group</a>, said the sell-out reflected both the strength of the Palm Beach market and the success of Sherpa's community-first approach to development.

"The sell-out of Oasis is a fantastic outcome and reinforces the strong demand we're seeing for thoughtfully designed apartments in lifestyle locations," Leet said.

"From the outset, our vision was to create a development that genuinely enhanced the Palm Beach community while providing residents with exceptional homes and wellness-focused amenities.

"We've been incredibly encouraged by the level of local support throughout the campaign, 72.5 per cent of buyers are locals, with a significant proportion of purchasers choosing Oasis as their future home rather than an investment."

[smartcode_project:default project_id=151449 project_image_fid=357463]

Construction is now progressing following development approval, with trusted builder LPS Group delivering the project and completion anticipated in Q3 2027.

Oasis forms part of Sherpa Group's successful Flourish collection, which has become recognised for its focus on wellness, community and elevated coastal living.

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Residents will have private access to a rooftop amenity space featuring a pool, gym, sauna, steam room, hot and cold plunge pools, spa and barbecue facilities.

"The success of Oasis demonstrates that buyers continue to prioritise quality, location and lifestyle," Leet said.

"We are proud to have delivered a project that has resonated so strongly with the market and look forward to bringing Oasis to life for our future residents."

Sherpa recently launched <a href="https://www.apartments.com.au/new-apartments/flourish-soleira-palm-beach-1150-1160-gold-coast-highway-palm-beach-qld-4221">Flourish Soleira</a>, its third instalment of the Flourish brand in Palm Beach following Flourish Oasis and <a href="https://www.apartments.com.au/new-apartments/amargo-6-12-sixth-avenue-palm-beach-qld-4221">Flourish Amargo</a>.

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Sherpa sells out Flourish Oasis in booming Palm Beach

Urban Property Group's <a href="https://www.apartments.com.au/new-apartments/la-vera-macquarie-park-94-talavera-road-macquarie-park-nsw-2113">La Vera</a> is leading the next phase of Macquarie Park's residential evolution, with the new apartment development set to become the first of several new apartment projects in the precinct to complete.

The 169-apartment building has now topped out ahead of its scheduled completion in the third quarter of 2026, as new residential investment continues to reshape one of Sydney's largest employment hubs into a true mixed-use precinct.

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Cox Architecture has designed La Vera to capture the best of its unique positioning on Talavera Road, orienting the building towards Lane Cove National Park.&nbsp;The building features a sculpted northern façade with flowing curves inspired by the surrounding landscape, while its city-facing elevation adopts a more structured architectural expression to maximise skyline views.

"The vision for the project was to conceive a building that adopted an organic and curvilinear form to the northern portion that faces the Lane Cove National Park," <a href="https://www.apartments.com.au/architects/cox-architecture">Cox Architecture</a> Director Felipe Miranda said.

"The residents that reside in the northern portion of the building benefit by having beautifully crafted curved balconies that speak to the natural context and heighten the relationship of their internal living spaces to the external balconies."

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La Vera offers a diverse mix of one, two, three, and four-bedroom configurations, with prices currently starting from $740,000. Buyers so far have been a mix of Sydney-based investors,&nbsp;metro commuters, owner-occupiers and downsizers from surrounding North Shore suburbs.

Both investors and owner-occupiers have been drawn to La Vera's proximity to Macquarie University, Macquarie University Hospital, Macquarie Centre and the Sydney Metro, infrastructure that supports both strong rental demand and a convenient lifestyle for residents.

The apartments feature full-height glazing, timber flooring throughout living areas, stone kitchen benchtops, SMEG appliances, floor-to-ceiling bathroom tiling and ducted air conditioning.

Residents will have access to a rooftop recreation level featuring a swimming pool, sauna, barbecue facilities and landscaped relaxation areas, complemented by additional communal space at ground level. Many apartments enjoy uninterrupted views across Lane Cove National Park, reinforcing the project's connection to its natural setting.

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<a href="https://www.apartments.com.au/developers/urban-property-group">Urban Property Group</a>, a family-owned developer and builder with nearly four decades of experience, holds a 4.5-star iCIRT rating and was Australia's first developer to introduce 10-Year Latent Defects Insurance (LDI). La Vera is the first apartment development in <a href="https://www.apartments.com.au/developments/macquarie-park-nsw-2113">Macquarie Park</a> approved to offer the additional insurance protection, alongside a five-year warranty on SMEG appliances.

Urban Property Group CEO Patrick Elias said the additional protection reflects changing buyer expectations in the off the plan market.

"Consumers are a lot more weary and a lot more concerned in buying off the plan than they ever have been. Having LDI is a tool to portray the confidence that we have in our product, and a confidence we want buyers to share," Elias said.

Following completion of the building later this year, buyers will move into their apartments well before Christmas.

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Staff reporter

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