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A gutted, roofless Denistone, NSW home has fetched $1,092,000 after being listed for sale by its mortgagee.
Located at <a href="https://www.domain.com.au/14-anzac-avenue-denistone-nsw-2114-2014886032" target="_blank">14 Anzac Avenue, Denistone</a> the two bedroom one bathroom home came with an auction price guide of $950,000, some $100,000 higher than the home's 2013 sale price of $850,000.
<a href="https://www.propertyobserver.com.au/subscribe" target="_blank"><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/2019/1/Subscriber%20strip%20ad.jpg" alt=""></a>
Previously listed at $1.5 million by the owner in early 2017, the property is set on 799 sqm.
The house is located within close proximity of Ryde Hospital, Eastwood Plaza and close to Top Ryde City.
The listing, through Daniel Hennessy of McGrath Ryde was marketed as a knockdown with any rebuild having "scope to capture views over Parramatta River and Olympic Park".
The median price for a home in <a href="/developments/denistone-nsw-2114">Denistone</a> is $1.777 million, according to CoreLogic, which calculate its annual change in median price over the past 10 years as 8.1%.
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Roofless mortgagee Denistone offering sold for $1.092 million

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A manorhouse residence set on 20 acres with an outlook across the surrounding countryside of Guys Hills has been recently sold on Melbourne's outskirts.
It was sold by Peter Watson from First National Real Estate Neilson Partners Berwick.'
The price is undisclosed but whispers suggest around $5.5 million.
It last sold at $1,225,000 in 2009.
Located at <a href="https://www.realestate.com.au/sold/property-house-vic-guys+hill-129751186" target="_blank">10 Myrtle Grove</a>, the Manorhouse comes with five bedrooms, a series of living areas including a formal lounge, bar equipped Billards room, home theatre, and segregated children's wing. 
<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/2019/2/14/guys%20hill%202.jpg" alt="">
The home also features a wet edged, horizon pool, tennis court, covered entertainment areas, yards and handling facilities. 
There is some 350sqm of warehousing accommodation incorporating offices, kitchenette and M&amp;F toilets.
It's close to Haileybury College, St Margaret’s Girls School, and Berwick Village.
<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/2019/2/14/guys%20hill%203.jpg" alt="">
 
Guys Hill’s next biggest sale was a 2ha property at 21 Quamby Road in 2016 at $2.3 million, CoreLogic records show.
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Guys Hill sale at double prior record price

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A Frankston South apartment block covered in flammable cladding is such a fire risk that a security guard has been posted out the front to prevent any arson attack.
The owners of the <a href="https://www.realestate.com.au/property/unit-5-5-culcairn-dr-frankston-south-vic-3199" target="_blank">flats</a> have been told by the Victorian Building Authority the cladding will have to be removed immediately.
There is an estimated $400,000 cost including fixing cracking, damp, leaking roofs and mould.
The opposition planning spokesman Tim Smith has raised the matter in State Parliament.
The VBA has declined to reveal the locations of buildings, most of which are privately owned, that have flammable cladding for fear of arson attacks.
A cladding audit ordered by Planning Minister Richard Wynne reviewed more than 2000 building and identified 44 private buildings among the “highest risk” of fire.
The cladding issue across Melbourne was sparked by London's deadly Grenfell Tower fire in 2017.
There was a blaze at the Lacrosse building in Melbourne Docklands and earlier this month a fire at Spencer Street’s Becton-built Neo200 apartments.
The Age reported the 33 owners of a block of apartments received an emergency order issued by Frankston City Council.
“We can’t afford this, people are going to lose their homes,” said Craig Fitch, chairman of Summardai Apartments’ Owners Corporation.
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Frankston South apartments caught up in Melbourne's cladding crisis

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EXPERT OBSERVATION 
In the lead up to the NSW election, the NSW residential building industry is being strangled in red tape and taxes.
Some 43% of the cost of a new house and land package is made up of taxes, charges and levies from all three tiers of Government.
Despite this, policies implemented by the State government continue to add to the tax burden for the housing industry.
By way of example, in the past 18 months, the following regulations and taxes have been implemented or proposed, each one having a negative impact on housing affordability and supply.
<ul>
<li>Removing caps on section 94 development contributions adding $20,000 – $40,000 per dwelling; 
</li>
<li>Increasing the BASIX energy efficiency targets adding an average of $10,000 per new dwelling; 
</li>
<li>Delaying the start of the medium density housing code to deal with Sydney’s “missing middle” for terrace and low rise medium density housing projects reacting to unreasonable and simple incorrect claims that the code would promote high-density housing after promoting the savings of around $15,000 in approval costs for these type of dwellings from the implementation of the code; 
</li>
<li>Introducing a 2% defect bond and an additional double barrel inspection regime for strata developments that will be ineffectual and add to the cost of all new strata projects and 
</li>
<li>Proposing a Greater Macarthur state infrastructure contribution (SIC) of $40,000 per dwelling, along with new SIC levies in the Hunter.</li>
</ul>
These changes can easily account for an additional $70-$90,000 per dwelling and once applied, they may be subject to stamp duty.
There are many things our state politicians can consider to help housing supply and affordability that don’t require drastic structural change.
For instance, the NSW Productivity Commissioner should be directed to undertake a detailed review of the regulatory burden and costs to the residential sector with the aim of reducing red tape, increasing productivity and thus improving housing affordability.
All new legislation and regulation impacting the housing sector should be subject to a thorough public regulatory impact assessment.
Adding to the problem of housing affordability and rental affordability with new red tape and taxes is not the solution to ensuring people in NSW can afford to buy or rent a home. More needs to be done now, politicians need to get serious and focus on real changes that will make a real difference to the cost of new homes in NSW.
David Bare is HIA Executive Director NSW.
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Taxes in NSW strangling future housing: HIA'S David Bare

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QM Properties are planning to build a 34-unit development on a riverfront St Lucia site.
The company purchased the 1,242 square metre site in St Lucia for $8.5 million.
QM Properties have amended the 160 Macquarie Street site  DA to provide a boutique luxury apartment project comprising 34 three bedroom apartments.
Brendan Hogan, the director of residential at Colliers International, handled the off-market expressions of interest campaign.
Glenn Rix, the development manager at QM Properties, said the north-facing riverfront project will be launched to the market in the second half of 2019.
QM Properties is a Brisbane based private development company with a history spanning over 40 years.
Their current portfolio includes residential, commercial, industrial and leisure developments, primarily within South East Queensland.
The site has passed hands several times, with Melbourne developer <a href="/news/melbourne-developer-kokoda-buys-st-lucia-brisbane-riverfront-site">Kokoda Property paying $9.5 million</a> for the site in 2017. 
Kokoda had planned a 15-storey, 60-unit development.
Photo: Prior listing of property from 2013.
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QM Properties plans 34-unit development on $8.5 million St Lucia site

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Goldfields' plans for the development of an 85-unit Chatswood residential tower has been endorsed by Willoughby Council.
The Chatswood development will be a further addition to Goldfields’ growing pipeline in New South Wales.
"Our project in Chatswood will be one of the first approved developments under the Chatswood CBD Planning and Urban Design Strategy, so it is a great opportunity to bring high-quality mixed-use residentialto an area that is demanding it," managing director of Goldfields, Marco Gattino, said.
The new development site is 400 metres from Chatswood Railway Station and Westfield Shopping Centre.
Construction is set to begin September 2020.
"It’s been a challenging 12 months for Australian property, however Sydney’s Lower North Shore is quickly becoming one of the most searched and desired places to live and work in Australia; and I see this trend continuing into 2020," Gattino said.
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Development approval for Goldfields project in Chatswood 

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A historic Perth hotel, the Paddington Ale House, is being offered for lease. 
Located at <a href="https://www.commercialrealestate.com.au/property/141-scarborough-beach-road-mount-hawthorn-wa-6016-12925310" target="_blank">141 Scarborough Beach Road, Mt Hawthorn</a>, the Paddington Ale House comprises a trading area of 1,676 sqm.
It is positioned on a corner block.
Built circa 1932, the hotel consists of a restaurant, bar, alfresco dining, and accommodation rooms.
The Paddington Ale House is licensed to hold 520 patrons.
<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/2019/2/20/Ale-House.jpg" alt="">
CBRE’s Ryan McGinnity and Chloe Mason have been appointed to market the long-term lease for the venue via an expressions of interest campaign closing March 12.
Mr McGinnity said The Paddo is a Perth institution, "being one of the city’s most well-frequented hotels over its 87-year existence."
"Not only does it benefit from an established reputation, but The Paddo’s position in a strong growth area will underpin its future success as a highly frequented venue."
“The venue’s location, 4km from the Perth CBD, proximity to Leederville, North Perth and Wembley and the potential to obtain a long lease term, all weigh in favour of the offering," Mr McGinnity concluded.
Ms Mason said with the City of Vincent’s population is expected to increase 33% over the next 17 years, local businesses such as the Paddington Ale House would benefit.
Plican Neil Randall sold The Paddington Ale House to his landlord in November 2018.
Mt Hawthorn Hospitality Co directors Robert and Ben Swanson took over.
Neil had owned the ale house for 31 years.
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Perth's Paddington Ale House offered for lease

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Westpac has confirmed it had joined Australia's three other major banks in not sending any further valuation work to LandMark White.
<p data-gtm-vis-first-on-screen-6236702_632="1550610401672" data-gtm-vis-total-visible-time-6236702_632="4000" data-gtm-vis-recent-on-screen-6236702_632="1550610405836" data-gtm-vis-has-fired-6236702_632="1">"Our immediate priority is to contact customers who may have been impacted," a Westpac spokesperson said.
"We are aware of a personal data leak involving LandMark White, a contracted service provider which conducts property valuations on our behalf," a Westpac spokesperson said.
It came a week after the other big banks pulled their requirement for LMW valuations on property for mortgage applications.
Independent LandMark White holds around 20 per cent share of the residential market with a further eight major property valuers, most of which are subsidiaries of large real estate agencies.
LandmarkWhite has also again suspended its shares from trading on the stockmarket, in the wake of stolen valuation records being posted on a dark-web forum for 10 days.
It suggests <a href="/news/landmark-white-blames-ill-informed-public-commentary-on-its-dark-web-data-breach-for-further-asx-share-suspension">the trading halt could be for as long as a month</a>.
The company advised shareholders that LMW had lost work from a significant number of clients which was "impacting our revenues, profitability and cashflows."
Only yesterday it indicated the valuation clients were likely to return.
"At this point in time we are unable to ascertain when these clients will reinstate LMW and hence when LMW will be in a position to assess with any certainty the financial impact of the incident," LMW updated the market at lunchtime Tuesday.
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"In addition, LMW anticipates that continued public commentary does not allow for an informed market for trading in LMW securities."
LMW expects that it would be able to provide the market with accurate information relating to the financial impact of the incident and hence a forecast for FY2019 within the next two to four weeks and lift the suspension at that time.
Last week Landmark White advised its investigations revealed that an unknown third party posted an <a href="/news/landmark-white-valuation-data-available-on-dark-web-forum-after-data-breach">illegally downloaded valuation dataset on a dark web forum </a>for 10 days in late January 2019.
It <a href="/news/landmark-white-enters-trading-halt-after-banks-suspend-its-use">sought the suspension of its ASX-listed shares</a> after some of the big four banks indicated they had <a href="/news/banks-drop-landmark-white-valuations-after-data-breach">stopped using LMW valuations</a>.
Westpac Group said it "takes the protection of personal information and privacy extremely seriously."
"We are investigating this matter and it is our immediate priority to contact and support any Westpac, St.George, Bank of Melbourne, BankSA or RAMS customers who may be affected.  
"At this stage, we believe only a small number of individuals are potentially impacted.
"The data disclosed includes property valuation details and some contact details (such as names, addresses and email addresses) of the various parties involved in the property valuation process.
"No loan application details, such as financial and identification documents, were disclosed.
"While we investigate the matter, we have also suspended sending any further work to LandMark White," Westpac told its customers.
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Westpac stops sending property valuation work to LandMark White after data breach

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GUEST OBSERVATION
Through 2018, annual growth in China continued to decelerate, from 6.8% at March to 6.4% in December. The annualised pace in the December quarter was weaker still, circa 6.0%. These are outcomes reminiscent of the GFC low of March 2009, so it is not surprising that many in financial markets are concerned about 2019 and beyond. From the official PMI’s, a broad-based slowdown is evident across manufacturing and, to a lesser extent, services, led by a deterioration in external demand.
Regarding trade, it is important to note that the shock being experienced by China currently is having flow-on effects for the rest of Asia, especially the north-east Asia block. Taiwan and Korea have high exposure to China demand, shipping 31% and 27% of their exports respectively to China in 2018. A large bulk (45-57%) of Korea, Taiwan and Japan’s exports to China are machineries, reflecting these economies’ involvement in China’s production chain. These economies’ exports of machineries have been weakening since November, particularly Korea and Japan which saw their exports of machineries to China plunge by 15%yr and 14%yr respectively in December. Weak imports of upstream goods by China do not bode well for China’s export outlook in the months ahead. The impact from weakening external demand is also being felt in domestic production across the region, given the high correlation between production and exports in a number of Asian economies. More than half of the Asian economies we monitor registered manufacturing PMIs below 50 in January.
Although the market’s focus remains on the effect of the global slowdown and US/China tensions on trade, the key determinant of China’s softer growth in 2018 was actually structural change, planned and managed by China’s central government. Put simply, in pursuit of long–term financial stability and sustainable growth, 2017 and 2018 saw China’s economic authorities focus on the quality of growth, particularly its longevity; equitable distribution; and environmental impact, with far ranging implications.
While we cannot ignore the risks apparent in China’s external position, that the pursuit of ‘quality growth’ is at the core of this slowdown and given Chinese authorities’ capacity and willingness to aid momentum, we look to 2019 and 2020 first and foremost with optimism rather than concern, anticipating growth will be sustained around 6%. Below we outline the key effects of the pursuit of ‘quality growth’ across three sectors (trade; investment; and the consumer), and also assess recent changes to market policy to facilitate it.
<a href="https://www.propertyobserver.com.au/images/2019/2/19/china%20slowdown%201.jpg" target="_blank">Click here</a> to enlarge:
<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/2019/2/19/china%20slowdown%201.jpg" alt="">
Source: Westpac
The outlook for trade: opportunity close to home
The immediate threat to China from US trade policy is real and pressing. Following the pull-forward of activity to front-run the tariffs’ introduction, export growth is set to weaken in 2019. However, taking a longer view (2020 and beyond), it is important to remember that any negative shock can be offset in time.
The US only receives about 20% of China’s total exports. China therefore has considerable opportunity to grow total exports even if US trade remains under pressure. Further, the Belt and Road initiative provides scope for assembly and low-value-add parts production to be moved to neighbouring economies, where US tariffs do not apply. With these factories still owned by Chinese firms, US’ tariffs can be bypassed while preserving China’s profits. Doing so would have the additional benefit of making room within China’s borders for manufacturing to shift up the technology spectrum, to the nation’s long-term benefit.
This development path should, in time, facilitate the building-up of wealth and consequently discretionary consumption. Regarding consumption, higher demand for overseas travel (tourism and education) will remain a negative for China’s trade position. However, there is prospect for some of this drag to be offset.
As China’s domestic service industries continue to develop and Belt and Road linkages grow, opportunity to diversify China’s export base across services will multiply. Construction, financial services and in-bound travel are all good sectoral examples.
<a href="https://www.propertyobserver.com.au/images/2019/2/19/china%20trade.jpg" target="_blank">Click here</a> to enlarge:
<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/2019/2/19/china%20trade.jpg" alt="">
Source: Westpac
The outlook for investment: quality to remain key
The shift in policy in favour of quality growth was most clearly evident in the investment detail, as historically-troublesome forms of investment such as poorly-planned infrastructure investment by local government authorities was sharply curtailed. As a consequence, growth in fixed asset investment across the economy slowed to historically weak levels: a low of 5.3%ytd at August and 5.9%yr for 2018 overall, as investment by State-owned Enterprises effectively stalled at 1.9%yr.
With the initial re-orientation of the economy towards quality growth achieved, authorities are increasingly acting to boost momentum. This is happening on two fronts. First, local government authorities are being encouraged to borrow directly from the market to fund new infrastructure – here, a brief RMB1.3trn surge of issuance seen in the September quarter 2018 and the issuance pipeline for 2019 provides a basis for cautious optimism. Secondly, the reserves of banks are being released by cuts to the Reserve Requirement Ratio, –350bps over the past year.
Regarding bank lending, authorities are encouraging banks to focus on up-and-coming industries, where there is maximum long-term benefit for China. However, loan availability for established businesses and the household sector is also being supported.
In stark contrast, opaque elements of the non-bank sector (trust and entrusted loans) remain under pressure from new regulation. Most notably, trust funding from banks has been curtailed by their need to report trust asset exposures. Non-bank funding has also been severely reduced by the banning of guarantees on Wealth Management Products (WMPs) and a need to specify where funds raised from households via WMPs will be invested.
One element of the non-bank sector that is showing promise however is capital market issuance, particularly debt markets, with authorities looking to encourage large firms to preference market issuance over bank loans to fund their capital needs. It should be noted though that many banks are investing in debt market instruments rather than new loans – hence the desire to free-up bank lending for smaller businesses and households has not been a complete success.
In 2019, our core expectation is that growth in fixed asset investment will stabilise at or a little above its end-2018 level. This is low by historical standards, but as the average quality of projects developed should be materially higher than in the past, the dividend to growth should be much improved. Key to investment’s overall performance will be investment by the private sector.
In the near-term, stronger growth in the private sector will require continued active promotion by authorities. Looking further out to 2020 and beyond however, market forces should increasingly take over from the government as the driver and assessor of investment projects. For China and its business community, increased economic and political engagement within Asia offers open–ended opportunity that will drive successive waves of investment on and offshore. As above, both forms of investment hold opportunity for China’s long-term growth and wealth.
The outlook for the consumer: income distribution crucial
In 2018, consumption (by both households and government) was the primary driver of aggregate growth. This result was a continuation of a long-standing trend, although the scale of the acceleration in 2018 was atypical. If 2019’s contribution is to match that of 2018, then the consumer must be on a sure footing.
The cyclical downswing in external demand makes this difficult. Employment growth across both manufacturing and services has clearly been affected by weaker external demand which seems unlikely to improve quickly. There is therefore a pressing need for investment in the domestic economy to spur offsetting growth, and with it job and income creation.
This highlights the need for a further easing of financial conditions, to make funds available to private and public enterprise at low cost, as well as continued encouragement of infrastructure investment by local authorities. Greater education attainment and entrepreneurialism also needs to be fostered, to make ready the workforce for the opportunities to come, while long-term household wealth needs shepherding.
On wealth, housing remains the sector’s primary asset. To preserve affordability and opportunity, house price growth needs to spread across the tiers and be aligned to income growth. To do so, a tight rein over investors will remain necessary to avoid the wealthy profiting from households down the income spectrum.
Further progress is also needed in the management of wealth ex-housing. The changes made to WMPs are a start, but new well-structured product now needs to be developed by the industry and invested in by households for the long term.
Policy and markets
Access to credit the priority
Recent monetary policy easing has had two inter-related targets, promoting lending to small enterprise and reducing funding costs.
Monetary policy has been eased since late last year, with the TMLF (targeted medium-term lending facility) launched on 19 December (with the first auction on 23 January) and given additional re-lending of funds. At the turn of the year, there was also a relaxation of the criteria for banks to enjoy lower reserve ratios (referring to the targeted reserve ratio cut announced back in January 2018). The eligibility for access to various liquidity facilities is mainly linked to the amount of loans extended to small enterprises. These policies apparently aim to encourage and support lending to small enterprises, and are in line with the policy direction expressed in the earlier economic work conference, which continued to use “prudent” to describe monetary policy but dropped “neutral”.
Another policy aim is to reduce funding costs. Most of the liquidity released via the 100bp cut in the Required Reserve Ratio (RRR) in January was to cover maturing MLF (medium-term lending facility) in Q1. Liquidity via a lower RRR is longer lasting, and the cost of funding much lower. Consider the 1yr MLF rate at 3.3% versus the 1.62% interest rate on required reserves; for the CNY1.2trn of MLF replaced, interest cost is reduced by CNY20bn. Provision of more long-term and low-cost liquidity is warranted to encourage lending to support constructive economic activities – in line with the official stance of adopting more counter-cyclical measures to promote growth.
Outright rate cuts?
There is an opinion in the market that the PBoC may need to cut interest rates. At this stage, we still believe that quantitative tools are more likely to be deployed. If there is an interest rate cut, it is more likely to be in bank lending rates than OMO (open market operation) reverse repo rates. First, funding costs can be effectively lowered through the use of different liquidity facilities, without an outright interest rate cut. Second, when it comes to getting OMO rates and bank lending/deposit rates more in line with each other, our interpretation is that the higher bank rates ought to be brought nearer OMO rates. That said, if the benchmark 7-day repo rate falls near the 2% level and stays there sustainably, then the PBoC may need to adjust OMO rates to play catch-up.
De-leveraging goes slow
While the de-leveraging campaign may still be on the agenda, it has been progressing less aggressively since Q4-2018. The shadow banking sector – proxied by the three off-balance sheet items under aggregate financing – shrank at a less rapid pace during Q4-2018 than in earlier quarters, and rebounded in January. The growth in RMB loans has not been quick enough to absorb the loan demand diverted from the shadow banking sector. This may justify a less aggressive de-leveraging campaign as a transitory solution, before credit accessibility is further enhanced via both bank loans and the capital market.
Bond supply versus inflows
An easing monetary policy backdrop and sustained bond inflows are supportive of the bond market. We expect bond yields to consolidate around current levels towards end-Q1 amid potentially heavier supply before facing renewed downward pressure later in the year. There may be heavier cash bond supply in Q1 than usual. First, the special LGB (local government bond) issuance quota for 2019 has been front-loaded, and the full-year quota is also touted to be a 60% increase over last year’s. Gross issuance of special LGB totalled CNY76.9bn in Q1-2018, representing a meagre 4% of 2018 full-year gross issuance. This amount can be easily surpassed in Q1-2019 if primary market activity starts to pick up in late February/early March. Second, the implication from the Central Bank Bills Swap (CBS) is a combination of neutral liquidity impact but with potentially more cash bond supply – though these bonds do not directly compete with CGBs (China Government Bonds).
There is likely to be a further easing in liquidity and credit through the year. We have pencilled in a 100bp RRR cut in each of the quarters from Q2 to Q4 this year. After cash bond supply is absorbed, we expect renewed downward pressure on yields and rates. In addition, bond index inclusion could mean sustained bond inflows. The confirmation of inclusion of Chinese bonds into the Bloomberg Barclays index had been well anticipated. Assuming a total of USD2.5trn of funds track the index, we believe index inclusion will lead to up to USD150bn of potential inflows over a 20-month period, or CNY50bn per month. This equates roughly to the average monthly inflow into CNY bonds in 2018.
CNY: no obvious outflow pressure
<a href="https://www.propertyobserver.com.au/images/2019/2/19/CNY.jpg" target="_blank">Click here</a> to enlarge:
<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/2019/2/19/CNY.jpg" alt="">
 
Source: Westpac
We now expect the next US rate hike to come in June instead of March. Hence upward pressure on USD/CNY triggered by USD strength is likely to be delayed. That said, trade relations remain a swing factor, while the impact of tariffs on the regional supply-chain is already evident and the outlook subdued. On balance, USD/CNY is likely to trade in ranges with mild upside risk.
USD/CNY should face strong resistance at the 6.85-6.90 area. Indicators including banks’ FX sales and settlement, PBoC forex purchase, and foreign reserves do not point to obvious outflow pressure. The potential bond inflows triggered by index inclusion is significant compared with other BoP items, and should present a key support to the CNY in the face of our expected USD strength going into the second half of the year.
The USD/CNY forward points have been falling until recently, as US-China interest rates differentials were compressed. The offshore USD/CNH forward points fell alongside, closing the gap with onshore. We view the movement in offshore points as primarily driven by onshore, while there has been a minimal addition to offshore CNH liquidity through the two main channels – stock flows and trade flows. As the onshore-offshore forward point differentials have narrowed and with CNH liquidity limited, CNH forward points may become more sensitive to any change in liquidity condition onshore or offshore.
Elliot Clarke is a senior economist at Westpac and can be <a href="https://www.westpac.com.au/news/authors/elliot-clarke/" target="_blank">contacted here.</a>
Frances Cheung is the Head of Macro Strategy Asia at Westpac. 
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China in 2019 - headwinds and opportunity abound: Westpac

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EXPERT OBSERVATION 
The policy of NSW Labor to scrap the Medium Density Housing Code must be balanced by support for higher rise apartment living says the Urban Taskforce.
The Labor Party in NSW has announced as policy to scrap the ‘Missing Middle’ code for terrace houses, but new development must go somewhere in Sydney. The best option for NSW Labor is to support higher rise residential around railway stations to accommodate the growing population.
The NSW Government has backed down on the terrace house complying code and allowed 50 councils to delay implementation. It would appear that communities do not want changes to the low rise detached house model that many suburbs have.
The best way to have minimal impact of the suburbs is to concentrate growth in taller residential buildings around railway stations and in town centres. There is a growing interest from younger people to live in apartments close to public transport, urban amenities and jobs.
The Mayor of North Sydney, Jilly Gibson, has recently come out supporting younger people living in apartments and she has been critical of older generations who are negative about this lifestyle. The Urban Taskforce supports Mayor Gibson’s advocacy for urban living for future generations and compliments her on her leadership in this area.
The current NSW Election which is only a month away has generated a lot of anti-apartment rhetoric from politicians and this has been based on scare mongering about excessive development. The younger voters who prefer urban apartment living seem to have been ignored by these politicians.
There is a place for medium density housing across Sydney but this is most likely to be in new greenfield developments. The economics of demolishing existing detached homes for a few terrace houses or town houses is unlikely to be viable in many parts of Sydney.
Chris Johnson is the Urban Taskforce CEO.
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NSW Labor must support apartment living if they scrap medium density code: Chris Johnson

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.

[smartcode_project:default project_id=147685 project_image_fid=359127]

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."

[smartcode_project:default project_id=1979 project_image_fid=363228]

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.

[smartcode_project:default project_id=150489 project_image_fid=373834]

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."

[smartcode_project:default project_id=150713 project_image_fid=373827]

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.

[smartcode_project:default project_id=134951 project_image_fid=368645]

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."

[smartcode_project:default project_id=134951 project_image_fid=358802]

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.

[smartcode_project_cta:default project_id=134951]

Staff reporter

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