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Clearance rates in Sydney are continuing to reach record highs, with more than 80% of homes up for grabs consistently selling each weekend.
On Saturday, 82.4% of properties sold at auction in Sydney, according to the latest figures from Australian Property Monitors.
APM senior economist Andrew Wilson said last year’s momentum is continuing to prevail in 2014 and there are no signs the market is slowing.
“Sydney is tracking around those low 80% numbers, even though we’re getting considerably high listing numbers for this time of the year,” he says.
“It’s a strong market in Sydney. There had been a feeling some of the budget markets like Canterbury, Bankstown and the west and south-western suburbs were falling off the pace, but even they had some reasonable clearance rates in the 80% range again.”
In 2013, the prestige market in Sydney lagged behind the rest of the market. However, this trend seems to have been reversed, with premium suburbs now also recording high clearance rates.
“Even though the bottom end had been waning a little bit, the top end has been picking up,” Wilson says.
“This market was quiet a year ago, but prestige property is back in town and there have been higher numbers of prestige properties on the market. There is a sense the prestige market has now taken on the energy the market’s had for the past 12 months.”
Over the past four weeks, Sydney has seen auction listing numbers consistently above 600.
“There are really no dark clouds on the horizon, which appeared to be gathering at the end of last year. Economic factors like retail sales and construction figures are on the up and low interest rates are one of the key drivers of the market,” Wilson says.
But Wilson says despite this some cracks could be starting to show in Sydney’s rental market.
“We’re starting to track a sense that vacancy rates are rising, which could be a concern for some investors, and rents have been flat now for some time. This could signal some concerns about the viability of the rental market,” he says.
In Melbourne, there were lower listing numbers than usual due to the Labour Day long weekend. However, out of the 227 properties listed for sale, 70.1% sold; an increase of almost 10% on this time last year.
“In Melbourne it was a holiday weekend, but it still had a reasonable clearance rate and listings were also up compared to this time last year,” Wilson says.
“The market is tracking a little higher than this time last year, with inner bayside suburbs particularly strong. We’re expecting a big weekend this week.”
Wilson says the strength of the Sydney and Melbourne markets is evidence of the effectiveness of low interest rates.
“The Melbourne market has passed every test which has been thrown at it so far… it shows what low interest rates can do,” Wilson says.
Brisbane, which has been tipped as the <a href="https://www.smartcompany.com.au/finance/investment/35385-brisbane-to-boom-house-price-growth-to-slow-property-trends-for-2014">hot spot for property investors in 2014</a>, recorded a clearance rate of 59.5% and 105 properties were listed for the weekend.
However, Wilson says this isn’t an accurate reflection of the market.
“In general terms there is a sense in the Brisbane market it’s picking up. It’s still below its previous price peak but expect to regain record level prices sometimes this year,” he says.
“Investors and the middle market are very active.”
This article first appeared on <a href="https://SmartCompany.com.au" target="_blank">SmartCompany</a>.
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Sydney auctions still going gangbusters, and there’s no sign of slowing

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In what’s no surprise to Australians, Sydney and Melbourne have been ranked as two of the world’s 10 most expensive cities, with wine, cigarettes and petrol particularly expensive by global standards.
The Economist Intelligence Unit’s latest biannual Worldwide Cost of Living Survey ranked Sydney fifth and Melbourne in equal sixth on the list. Australian cities Perth, Brisbane and Adelaide ranked inside the top 40.
The most expensive city in the world was deemed to be Singapore, followed by Paris, Oslo and Zurich.
Rounding out the top 10 most expensive locations were Caracas, Geneva, Tokyo and Copenhagen.
“As well as Singapore there have been <a href="https://www.smartcompany.com.au/finance/investment/35572-residential-property-value-exceeds-5-trillion-with-sydney-the-most-expensive-city" target="_blank">sustained increases in the cost of living in Australian cities</a>, driven by the long-term appreciation of the Australian dollar,” the report says.
“As a result, Asian (and Australasian) locations made up one-half of the 10 most expensive cities last year.”
Over the past decade the Singaporean dollar has risen by 40%, which along with solid price inflation has resulted in Singapore moving steadily up the rankings, from 18th a decade ago to first.
“The city also has some structurally expensive items that skew the overall cost of living upwards. For example, car costs have very high related certificate of entitlement fees attached to them, which makes Singapore significantly more expensive than any other location when it comes to running a car,” the report says.
And while Melburnians frequently complain about the cost of transport, spare a thought for the Singaporeans whose transport costs are three times that of New York. It’s also the most expensive place in the world to buy clothes, with an abundance of luxury and European brands.
The survey of 140 cities assesses the cost of more than 160 products and services including drink, clothing, household supplies, rent, transport and utility costs.
While New York is used as the benchmark city for comparisons, its cost of living has only increased slightly this year, with the Big Apple moving into 26th overall.
“This is partly reflected by the stronger performance of cities around New York in the ranking, with European cities in particular buoyed by an appreciation of the euro over the last twelve months,” the report says.
On the opposite end of the spectrum, the world’s least expensive city was found to be Mumbai.
While Asia is responsible for some of the world’s most expensive cities, it’s also home to the cheapest.
“Within Asia the best value for money is in the Indian subcontinent (defined as India, Pakistan, Bangladesh, Nepal and Sri Lanka),” the report says.
“Mumbai is the cheapest location in the survey and three of the four cheapest cities surveyed hail from Pakistan, India and Nepal. These cities are only joined by Damascus because of the unfolding crisis in Syria and its impact on exchange rates.”
Karachi and New Delhi rank second and third on the cheapest cities list, while Damascus comes in fourth and Kathmandu also makes the top five.
Also included in the bottom 10 cities are Algiers, Bucharest, Panama City, Jeddah and Riyadh.
These locations might be cheap, but they’re not cheerful. The chances are even people looking for a cheap holiday won’t consider travelling to many of these cities, as most are known for their security issues and civil unrest.
The 10 most expensive cities (four cities have been ranked equal sixth most expensive):
1. Singapore
2. Paris, France
3. Oslo, Norway
4. Zurich, Switzerland
5. Sydney, Australia
6. Caracas, Venezuela
6. Geneva, Switzerland
6. Melbourne, Australia
6. Tokyo, Japan
10. Copenhagen, Denmark
This article first appeared on <a href="https://www.SmartCompany.com.au" target="_blank">SmartCompany</a>.
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Sydney and Melbourne in 10 most expensive cities, but Singapore tops the list

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The conflict in Ukraine has escalated with Russia sending in 6,000 troops and naval forces to the Crimean peninsula on Sunday, triggering a standoff between Russia and the West.
The action by Russia sent waves of caution through investors globally, with stock markets worldwide falling on the news.
Last month Ukraine President Viktor Yanukovych was overthrown by the Parliament, following bloody anti-government protests in the nation’s capital of Kiev.
The protests were triggered when Yanukovych rejected an accord with the European Union in November 2013 and instead formed stronger ties with Russia, angering locals who had long pushed for greater integration with Europe.
The protests started peacefully, but escalated when the authorities became involved, with student protestors beaten and opposition activists supposedly abducted.
On February 20, 77 people were killed and nearly 600 wounded in a 48-hour period.
As diplomatic tensions in the region rise, we takes a look at how the instability could influence the Australian and global economies.
So Russia has sent 6,000 troops to the Crimean peninsula in Ukraine and the West disapproves. Is this having an impact on global markets?
In short, yes. The impact globally is varied, but there’s no doubt investors are wary and this is being translated into falls on sharemarkets around the world.
JPMorgan chief economist Stephen Walters said the financial markets “are watching”.
“In Europe markets fells 2-3% yesterday. Germany was down almost 3.5%, the UK fell 1.5% and France lost 2.5%. Generally there were greater losses depending on the closeness to the regions,” he says.
“In the US the Dow Jones lost 1%, so it’s watching. The US involvement here is distant, but clearly it has been involved in diplomatic conversations.”
In Russia the stock market was down 11.5%, as the rouble has fallen to near record lows against the US dollar and the euro. Russia has also raised interest rates by 1.5 percentage points.
So the conflict is making investors more wary globally, but has this impacted Australia?
Ukraine’s direct impact on Australia is relatively small, as we don’t trade with the region in a significant way. However, our sharemarket regularly takes its lead from global markets.
Yesterday the S&amp;P/ASX200 benchmark closed 20.50 points lower, down 0.38%. The loss was minimal compared to other markets, but Walters says today might be a different story.
“We could see a greater impact today following the losses on global markets yesterday,” he says.
Walters says the impact of the conflict in the coming weeks is unknown.
“If the situation is diffused and diplomacy wins, everything could return to normal, but if it escalates, so could the economic impact,” he says.
Evidently stock markets have fallen here and around the world, but what’s happening with commodities?
Oil and natural gas prices have been pushed higher, as Ukraine is home to one of Europe’s major gas pipelines, with the gas controlled by Russia.
Brent crude (a major benchmark price for the purchase of oil worldwide) rose by 2.1% yesterday to $111.38 a barrel on the ICE Futures Europe exchange.
The West Texas Intermediate also jumped yesterday to a 23-week high on the back of the crisis.
“There have been quite significant developments already,” Walters says.
“If oil prices keep going up, this will result in energy and petrol price increases.”
Walters says the crisis is having an impact on oil prices because Ukraine is a “strategic region”.
“We also saw this take place in Bahrain last year. However, if there’s an issue somewhere else, you don’t necessarily see this kind of impact. For this region, the response of oil prices is typical.”
Oil and gas prices are on the rise, but what about gold?
As investors are more cautious of risky investments, many turned to gold yesterday, sending prices higher.
“Gold is a safe haven flow,” Walters says. “You buy gold when there are global tensions, or natural disasters like what happened with Fukushima in Japan.”
Obviously there are some pretty significant economic impacts of the crisis, but what does the Australian government think about all this?
Ukrainian Prime Minister Arseniy Yatsenyuk said yesterday Russia and Ukraine are on the brink of war and the Western governments have criticised Russia for invading Crimea.
Prime Minister Tony Abbott told Parliament yesterday a trip to Moscow by Trade Minister Andrew Robb had been cancelled in light of the action, as was a visit to Australia by Russia’s National Security Advisor Nikolai Patrushev.
“It should withdraw its forces from the Ukraine and the people of the Ukraine ought to be able to determine their future for themselves,” Abbott told Parliament.
“The situation in the Ukraine is fluid and it’s threatening; all Australians are rightly concerned about that.”
This article first appeared on <a href="https://www.SmartCompany.com.au" target="_blank">SmartCompany</a>.
      
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What does the conflict in Ukraine mean for the Australian economy?

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Queensland police have arrested a bikie who allegedly stole a Western Australian investment company’s identity and stole $1.4 million from mum and dad investors.
In the <a target="_blank" href="https://www.propertyobserver.com.au/news/warning-issue-on-identity-thieving-conmen-trashing-building-businesss-name/2014022568018">second case of business identity</a> theft this week, 33-year-old Tyrone de Luca, said to be a member of the Black Uhlans bikie gang, was arrested yesterday for his involvement in the investment scheme.
Police suspect another man with links to the Bandidos was also involved, but he is yet to be questioned.
Investigators are alleging the men adopted the identity of the WA business, cloning its website and registering the name M6 Securities Group.
The men are also said to have created a fake Perth business address and telephone number.
Detective Inspector Phillip Stevens of Taskforce Maxima said at a press conference yesterday the perpetrators had also adopted the persona of the directors of the legitimate business and used a call centre to generate leads.
“[They] have contacted potential victims, they have approached the victims and they have encouraged them to deposit money into a variety of investment schemes,” Stevens says.
“In exchange for that investment they are given a user ID and password to a backend of the website where that backend is manipulated by someone involved in the crime to give the illusion they’re making a profit. At the end of the day they don’t make a profit and the money dissipates.”
The call centre workers involved in the scam were said to be unaware the company was a front for a bikie operation.
“The template for these things is that the people involved in the telemarketing or the cold call centres don't have an idea of the ultimate gain,” Stevens says.
“Their role is simply to make contact and to pass it on to the people who will approach the victims.”
Stevens says between 30 and 40 fake call centres are operating on the Gold Coast.
Warfield and Associates chief executive Brett Warfield told SmartCompany business identity theft such as this is becoming easier to execute.
“It’s harder than individual identity theft, but from what I’ve read, it’s been made easier by the internet,” he says.
“People looking for investment options are now bypassing traditional sources of information like the newspaper and financial advisors and searching on the internet. It’s easy to establish an identity online which takes over from another organisation.”
Warfield says with a “half decent IT specialist” skilled in online marketing, a legitimate-looking website can be created in a matter of months including links, Google Adwords and key word search terms.
“It’s not hard to do… It can be done offshore. You don’t even need to have someone on the ground, it can be done from a desktop computer at your home and money can be transferred overseas,” he says.
Warfield says the Queensland bikies would have taken the identity of a WA business strategically with the intent to deceive potential investors.
“It would have been an attempt to separate the investor from the possibility of them doing background research,” he says
“Anyone thinking of investing needs to do due diligence and some fundamental background research.”
This latest scheme saw the union of two motorcycle gangs for the initiative, something which has become increasingly more common, Stevens says.
“There seems to be no boundaries as to who they associate with. It seems to be becoming more common that criminal motor cycle gangs will do business with one another if it suits their purposes,” he says.
This arrest is the first for the operation, but more are likely to come.
“We have identified a number of companies linked to these fraudulent activities. The arrest of the male person is by no means the end of these investigations; it merely forms part of a great investigative strategy,” Stevens says.
Warfield says as a blanket rule people should not invest with anyone on the basis of a cold call.
“Number one you’ll be dealing with someone on the end of the phone with a script in front of them. They tend to talk over the top of the person, spruiking the product and how great it is and it catches people off guard. So don’t enter into the conversation.
“Remember, if it’s too good to be true it probably is. If the market is paying X per cent and someone offers you three times that, realise there is a risk there.”
This article first appeared on <a target="_blank" href="https://www.SmartCompany.com.au">SmartCompany</a>.
                                
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The bikie, a cloned business and a million-dollar scam

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A group of 12 single Japanese people are suing real estate agents <a href="https://www.google.com/url?q=https://www.smartcompany.com.au/legal/35618-empty-pockets-broken-hearts-over-25-million-lost-to-heartless-dating-scams-in-2013&amp;sa=U&amp;ei=040OU8ruB43koASmvoAQ&amp;ved=0CAgQFjAB&amp;client=internal-uds-cse&amp;usg=AFQjCNHtF2gCloxCt5VAGxiEBRQwCTySBQ">for feigning romantic interest</a> in them to trick them into buying a property, or three.
In this latest romance scam, the Japan Daily Press is reporting the victims are suing 14 companies including real estate agencies and insurance firms for approximately US$1.95 million (A$2.18 million).
The singletons were allegedly targeted through online dating sites and once the romance commenced, they would then be encouraged and coerced into buying properties.
After the deal had been signed, the real estate agent would swiftly abandon the relationship.
A lawyer for one of the victims, Shinichi Hirasawa, told Japan Daily Press the agent had “taken advantage of the romantic feelings” of the victim.
“This is a flagrant scheme because the victims were made to purchase real estate, sometimes at prices 30% to 40% above the market rate.”
Sales expert Sue Barrett told SmartCompany the approach of these real estate agents “isn’t sales, it’s just deception”.
“It’s not selling at all. These people are out for victims, not prospective customers… They’re scamming people to give them money at their expense. It’s a case of buyer beware,” she says.
“[In sales] You can be flirtatious and you can be charming, but if your intentions are dishonourable and you’re trying to manipulate people, then no, it’s not okay behaviour.”
Barrett says salespeople can use charm to engage with a person, but communication needs to be “open and transparent”.
“As a woman in business, personally speaking, the last thing on our mind for most of us is to be misinterpreted in any way. You can be personable, but you don’t want to give off other signals and have confusion.”
Barrett says this type of deception is similar to a trend in the United States which was eventually outlawed called barrier selling.
“Essentially it’s manipulating people and backing them into a corner where the only answer they can give is yes,” she says.
“The insurance industry was notorious for barrier selling. They would ask customers leading questions to which the most logical answer would be yes. They’ll ask several questions which require affirmative answers and trick people into agreeing to purchase something they don’t want.”
Barrett said this type of selling led to cooling off periods to be legislated.
“If you want to be an honourable business person, you have to be clear about your intentions. Make sure you’re putting forward what it is you want to achieve,” she says.
Sales Acuity founder Stephen Chow told SmartCompany salespeople without adequate training often resort to flirting to progress a sale.
“There are of course instances where this works, but the long term success of a salesperson is really only achieved through relationship integrity,” he says.
“We know that exceptional salespeople have an underlying sense of purpose and a set of principles centred around ethical selling behaviour, and this drives their decisions and actions.”
Chow says a better approach than flirting is for people to be engaged, smart and enthusiastic.
“Our research shows that exceptional salespeople are socially skilled, enthusiastic and energetic. They capture attention and interest by creatively differentiating themselves from others. They position themselves as an expressive, memorable and compelling force in the room,” he says.
“Critical to the success of any sales encounter is the first four seconds… Body language, tonality and what they say in these very first moments are crucial and when it is delivered just right – it looks like charm. When it's not – it comes across as repulsive.”
This article first appeared on <a target="_blank" href="https://www.SmartCompany.com.au">SmartCompany</a>.
              
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Japanese singles sue flirty real estate agents for not-so-sweetheart deals

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Melbourne live music icon <a href="https://www.smartcompany.com.au/finance/wealth-management/33435-rich-tales-the-longest-pub-crawl" target="_blank">The Esplanade Hotel is up for sale</a>, with the venue expected to be sold for millions.
Commonly known as “The Espy” to Melburnians, the local haunt is up for grabs through Jones Lang LaSalle, but the owners are keen to retain the freehold title to the venue.
If the current owners retain the freehold title they will keep the land title, but the new owners will own the venue and the income.
<img alt="the-espy-feb-19-breakotu" height="264" width="470" src="/images/stories/2014/02/26/the-espy-feb-19-breakotu.jpg">
The venue, located on the St Kilda foreshore, is expected to be worth over $5 million, according to Fairfax Media reports.
A long-term lease is on offer for the successful buyer.
A site of controversy
The pub is one of Australia’s longest running live music venues, but was the centre of controversy in late 1990s and the early 2000s as notable property figure Max Beck and later the company he chaired, Becton Group, tried to take over the operations.
Becton Group wanted to turn the site into a residential housing complex, but the plans were met with community objection, with a petition against the plans receiving thousands of signatures.
Early life
Prior to the opening of The Esplanade Hotel, the site had been the home of the New Bath Hotel in 1857 as a resort hotel.
The venue now known as The Esplanade Hotel wasn’t opened on the site until 1878 and since its construction has always been a host of live music events.
Music history
In the 1920s it changed from being exclusively a residential location for the wealthy to incorporate entertainment for the middle classes.
Between 1920 and 1925 it became an important jazz venue in what was Melbourne’s main entertainment destination at the time.
Its reputation as a premium live music venue was firmly established throughout this time and has since progressed through a range of music genres from swing to punk and grunge.
Famous faces
The hotel has attracted a number of famous musicians and Paul Kelly recorded his album Live at the Continental Esplanade at the hotel in 1995.
SBS trivia show RocKwiz has also been filmed since 2005 in The Espy’s Gershwin Room.
In the hotel’s early days famed Australian entrepreneur Alfred Felton is said to have stayed at the Espy between 1892 until he died in 1904.
While it was in use as a resort, famous author Mark Twain also visited the hotel in the 1880s and is thought to have stayed there under his real name, Samuel Clements.
This article first appeared on <a href="https://www.SmartCompany.com.au" target="_blank">SmartCompany.</a>
              
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The Espy Hotel up for sale: Four things you didn’t know about the Melbourne landmark

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Victoria’s consumer watchdog has issued an alert to small business owners to be aware of conmen stealing businesses’ identities and ripping off consumers.
Consumer Affairs Victoria has received multiple complaints against some men who adopted the identity of a Queensland roofing business to trick Victorian home owners into paying them for subpar services.
Strongguard Roofing was contacted earlier this month by a Melbourne man who <a href="https://www.smartcompany.com.au/technology/information-technology/32204-accc-report-shows-scammers-cost--93-million-last-year-five-lessons-for-your-business" target="_blank">had been scammed</a> by a group of people purporting to be from the Queensland business.
Director Warren Hebbard told SmartCompany Strongguard Roofing doesn’t do any business in Victoria.
“The Melbourne man had originally checked our company website and went with them believing they were a trustworthy business, but when he realised they weren’t he contacted us via email and we chased it up,” Hebbard says.
“We then got another email from a different home in the same area, so we contacted Consumer Affairs Victoria.”
Consumer Affairs Victoria director Claire Noone said in a statement the conmen would knock on people’s doors spruiking their work and tell homeowners to check Strongguard Roofing’s website to verify their business credentials.
“If they do any work, it’s likely to be shoddy and unfinished,” she says.
Strongguard has since put up a warning on its website warning customers of the dodgy copycats.
Hebbard says in one case a number of houses in a single street were targeted, with a group of eight conmen, possibly from Ireland, pretending to be from the company.
“While we don’t do any business in Victoria, because of the internet this type of scam trashes our name,” he says.
“It’s a pretty serious issue.”
Consumer Affairs Victoria says the travelling conmen would offer a cheap deal for ‘today only’ to consumers on jobs such as painting, roof repairs and sealing bitumen driveways.
The men would pressure the consumers to pay up front and then perform shoddy work or not finish the job.
“They were going in cheap and unfortunately people often grab deals which look too good to be true,” Hebbard says.
“Because we think these guys are from overseas they’ll be pretty hard to catch unless they’re caught on a job. If they’ve gotten away with a fair few houses they may change tact and adopt a new business identity.”
Noone says it’s important for consumers to check a business’s credentials.
“Look up the business’ contact details – don’t use the details the person provides – and call the business to ask if the person at your door represents the company,” she says.
“There is a very real risk to your business’ reputation. Reports provide valuable intelligence to help us warn the community and stop conmen.”
Hebbard says these conmen have a leaflet with their business name on it and a phone number which isn’t theirs.
“They picked our business because we’re a known company, but maybe because we’re in Queensland they thought they’d get away with it,” he says.
“To get these emails and see someone else is using our name, it was very disappointing. Blood, sweat and tears went into building the business and then someone comes along and just tries to trash our name.”
This article first appeared on <a href="https://www.SmartCompany.com.au" target="_blank">SmartCompany.</a>
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Warning issued about identity-thieving conmen trashing building business’ name

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In November 2013 Australian adults working full-time were on average making $1,437.00 per week in ordinary time earnings, a jump of 2.9% in the previous 12 months.
According to Australian Bureau of Statistics figures, in ordinary terms males working full-time were earning on average $261.60 more than females.
While employees of the mining sector earned significantly more than any other sector, bringing in $2,469.60 per week.
The lowest paid industries were the retail, accommodation and food services industry, where full-time employees made on average less than $1,100 a week.
This article first appeared on <a target="_blank" href="https://www.SmartCompany.com.au">SmartCompany.</a>
 
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Adult average weekly earnings on the rise

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Two leading international economists have forecast a property bust, if interest rates stay low and house prices continue to rise faster than wages growth.
Former top government economist Quentin Grafton has signalled the growth in house prices is a concern.
“While I am cautious enough not to claim there is a ‘boom’ that inevitably implies a bust, the recent growth in the national median house price of 9% in 2013 (14% in Sydney) is of concern, especially when it is about three times greater than nominal wage growth (and also inflation),” he will say in a speech to the Australian Bureau of Resources and Energy Economics.
“Should the house price growth spurt continue for much longer there could be an overshoot that may create an ‘overhang’.”
Australia’s ratio of house prices to income is the second highest in the world, although it remains slightly below its peak.
Grafton, now a professor with the Australian National University’s Crawford School says Australia has had one of the most rapid rises in nominal house prices of all developed countries since 1997.
Australia also has a household debt-to-income ratio of around 150%.
“The risk is that if Australia were to continue its historically low interest rates (the cash rate is at 2.5%), the housing price surge will continue,” Grafton says.
It’s unlikely the Reserve Bank will lower the official cash rate again, choosing on Tuesday to keep interest rates on hold. However, the RBA is still faced with a need to keep rates low enough to support economic growth.
“Successfully achieving all of these objectives simultaneously while avoiding a housing price boom, and in the midst of competitive devaluations from key trading partners, is a big ask of any central bank,” Grafton says.
“Given that Australia’s major banks borrow 30-40% of their funds from offshore capital markets, any rapid fall in house prices would pose a dilemma for the big four banks and would likely result in an Australian-made credit crunch.”
A UBS survey of bank chief financial officers released yesterday revealed banks are lowering their lending criteria, offering more competitive mortgages and discounting fees.
“Loan officers indicated lending standards have been loosened materially in both mortgages and large corporate lending over the last six months,” the report says.
“In housing, improved market prospects and competition were cited as the factors driving a loosening in standards. This has led to a material reduction in both price and fees in mortgage lending.”
Grafton’s predictions are not as dire as other forecasters, with United States demographer and economist Harry Dent saying this week Australian property prices will fall between 30-50%.
Dent says Melbourne and Sydney will be the worst affected and the crash will likely occur if the stock market suffers major losses or the Chinese property market declines.
“Bubbles ultimately peak when the people buying can’t afford to buy it,” he says as quoted by <a target="_blank" href="https://www.news.com.au/finance/real-estate/us-demographer-predicts-hit-to-aussie-home-prices/story-fndba8uq-1226816510923">News.com.au</a>.
“I see it like a popcorn popper, different markets are bursting at different times … but all of real estate in coastal cities all around the world is greatly overvalued and they're all going to burst whether it be 30 per cent or 40 per cent ... or 90 per cent in the worst case.”
Dent predicts the “China bubble” will burst next year and when it does, Australia will be the hardest hit.
“I see real estate going down 60-65% in the US, it's probably more like 30-50% in Australia, but that's still enough for you to say, ‘Hey why would you go buying real estate?’” he says.
Dent accurately predicted the 2008 GFC, but Australian Property Monitors senior economist Andrew Wilson told SmartCompany there will always be doomsday predictions when the market is doing well.
“These predictions are no surprise because there is a revival in the market at the moment. However they’re fruitless. They suggest catastrophic outcomes, but the underlying fundamentals and the historical evidence suggests this won’t occur,” he says.
“Equating incomes with house prices lacks relevance. The real issue is income versus mortgage repayments. The evidence clearly shows the average income required to pay a mortgage in most capitals is about 25% of weekly disposable income and that’s remained the same for a number of decades.”
Wilson says the only way there will be a major crash in house prices is if there is another global financial crisis “unlike what we’ve ever seen before”.
“We have a very rigid lending environment which is another factor in insuring a resilient housing market over the median to long term,” he says.
“Banks are competing more vigorously for market share at the moment which is pushing mortgage rates down…. But interest rate levels are really only where they were in 2008. They haven’t dropped to levels you might associate with a higher risk.”
This article first appeared on <a href="https://www.SmartCompany.com.au" target="_blank">SmartCompany.</a>
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Economists warn of a property bust if interest rates stay too low

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Barossa Vines and its directors have been fined more than $1 million for breaching promoter penalty provisions following an investigation by the Australian Taxation Office.
The Tax Office has issued a warning to managed investment scheme operators to implement the schemes as promised, or risk high penalties.
Barossa Vines had been running a managed investment scheme and failed to carry out its wine grape growing activities in accordance with its agreed product ruling.
The company was ordered to pay a penalty of $625,000 while its four directors were made to pay $125,000 for poorly managing the scheme.
The schemes took place during 2007 and 2008 and saw investors in the scheme to pay an upfront management fee of $4400 to establish and manage a vineyard on the land.
Hundreds of investors took part in the schemes with a total of more than $20 million invested across the two schemes.
ATO deputy commissioner Tim Dyce said in a statement product rulings are designed to give people certainty about the tax consequences of their investment.
“The scheme must be implemented as it was described,” he says.
“As we discovered, this was not the case and the promoters’ actions had unfortunate consequences for investors, whose deductions were disallowed.”
The ATO has the capacity to withdraw product rulings at any time and a ruling does not give an investment a tick of approval.
Thomson Reuters tax expert Terry Hayes told SmartCompany these types of schemes were popular a few years ago.
“A lot of the heat has gone out of these managed investment schemes now. The problem arises with the product rulings – if the scheme runs in accordance with what the ATO understand, then it’s fine, but if it deviates in any way then the product ruling is no longer valid,” he says.
“When there is a variation, this means the tax consequences change, impacting upon investors.”
Hayes says in this case a number of vineyards weren’t planted in the appropriate timeframe and some had been abandoned, going against its product ruling.
In an interview with The Australian Financial Review,Dyce said the ATO is reviewing a number of similar cases and considering litigation.
“We occasionally find people will hand over $100,000 or $200,000 to somebody based on a glossy brochure and a promise,” he’s quoted as saying.
Hayes says people opt to invest in these schemes on the promise of great returns or tax deductions.
“They can offer some fairly good returns and deductions and if the ATO approves the arrangement generally they’re fine. Some people plan for a loss to reduce their tax, but not everyone can afford to sustain a loss,” he says.
“This was a big fine, I’d say probably one of the biggest which has been levied, but it’s within the parameters of what the legislation allows.”
Hayes says people running these schemes should inform the ATO if circumstances changes.
“The people managing these schemes are often doing all they can to keep them afloat, but seasonal patterns can have a big impact on agricultural schemes.”
This article first ppeared on <a target="_blank" href="https://www.SmartCompany.com.au">SmartCompany.</a>
 
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Barossa Vines fined $1 million following ATO investigation

Sherpa Property Group has unveiled the third instalment of its Flourish series, securing full approval for the two-tower, $500 million Flourish Soleira development in Palm Beach.

<a href="https://www.apartments.com.au/new-apartments/flourish-soleira-1150-1154-gold-coast-highway-palm-beach-qld-4221">Flourish Soleira</a> will rise from a prominent site in the commercial heart of Palm Beach, the long-time home of Cash Converters and a range of local retailers.

The project will introduce a new retail and dining precinct at ground level, beneath 286 apartments.

[smartcode_project:default project_id=150017 project_image_fid=370959]

“We’re very committed to not only providing affordable residential offerings that are much needed in Palm Beach, but also delivering a vibrant new commercial heart that complements the extraordinary growth of the southern Gold Coast,” Sherpa Property Group founder Christie Leet said.

The development will sit under Sherpa's Flourish brand, which is aimed at providing a pathway into the beachside suburb for locals, first-home buyers and downsizers. In a move designed to assist first-home buyers entering the market, Sherpa has reserved all one and two-bedroom, one-bathroom apartments exclusively for eligible first-home buyers.

[smartcode_project:default project_id=150017 project_image_fid=370964]

“Our vision through Flourish is to create a vibrant retail and lifestyle focal point within the Palm Beach centre zone, delivering thriving communities underpinned by lifestyle-rich locations,” Leet said.

“So far, Flourish has been an incredible success, and we hope to carry this momentum as we progress the next two Flourish projects in Palm Beach.”

[smartcode_project:default project_id=150017 project_image_fid=371430]

Located across 1150-1164 Gold Coast Highway and 3 Sixth Avenue, the development will comprise two towers. The northern tower will deliver 154 apartments, while the southern tower will add a further 132 residences, helping address ongoing demand for new apartments in the tightly held coastal suburb.

Flourish Soleira will also feature the most extensive rooftop amenity offering ever delivered in Palm Beach.

The two towers will be connected by a skybridge, with residents gaining access to a rooftop recreation deck featuring a full-width swimming pool, hot and cold plunge pools, wellness spaces, a gymnasium, private dining facilities, massage treatment rooms, barbecue areas, a basketball court, golf simulator, indoor and outdoor dining spaces, sun lounges and extensive landscaping.

LPS Group is expected to start construction later this year.

Sherpa is already well advanced on construction of its debut Flourish project, Flourish Amargo, located just around the corner from Soleira. Meanwhile, Flourish Oasis, positioned opposite Amargo, recently commenced construction and has nearly sold out its collection of 47 apartments.

[smartcode_project_cta:default project_id=150017]

Joel Robinson

Sherpa unveils $500m mixed-use Palm Beach precinct, Flourish Soleira

Are mortgage holders set to get a reprieve from the RBA in 2026?

Big Four bank NAB believes so. They are now expecting the next move from the RBA to be a cut, rather than a hike, which they had pencilled in for August. They are unsure of the timing of the cut however, they note in their latest&nbsp;NAB Economics RBA Watch.

NAB Chief Economist, Dr Sally Auld, said recent data suggests the economy has lost momentum and the outlook for rates has shifted, noting that the broader economic backdrop has changed since earlier in the year.

“The next move in the cash rate is likely to be down, but the timing is uncertain," Dr Auld said.

"In February, growth was above trend, the economy was operating above capacity and there was uncertainty over the restrictiveness of rates. None of these conditions exist today,” she outlined.

Dr Auld said recent data pointed to softer momentum across the economy while acknowledging that at the same time, uncertainty remains a key feature of the outlook.

“Both Q1 GDP data and the NAB business survey suggest momentum in the economy has slowed, meaning that growth has likely peaked for the cycle. That said, we are cognisant there is still considerable uncertainty around the outlook, both with respect to activity and inflation.”

Dr Auld said inflation risks and labour market outcomes would be important to watch.

“On the prices side, we are still forecasting above target core inflation through to mid-2027. Margins will compress and weaker labour market outcomes are a risk.”

She said tighter financial conditions are expected to weigh on housing and activity.

“Tighter financial conditions will be reflected in a slowing in house price growth and housing credit growth. In summary, we have greater conviction that the next move in rates is down, but less conviction on the timing.”

Mortgage relief? NAB forecasts RBA rate cut, not hike, after softer economic conditions

A local downsizer has splashed $6.5 million on a penthouse in Perifa's Alex &amp; Willow development in Crows Nest. 
&nbsp; 
The purchaser sold their long-held family home in the area before embarking on a six-month search for the right apartment. After inspecting a range of options across the Lower North Shore, the buyer returned to <a href="https://www.apartments.com.au/new-apartments/alex-willow-crows-nest-82-90-alexander-street-crows-nest-nsw-2065">Alex &amp; Willow</a>. 
&nbsp; 
The buyer profile reflects the project’s broader purchaser mix. <a>Alex &amp; Willow</a> has attracted predominantly local downsizers looking to transition from larger homes without compromising on space or quality, alongside a smaller cohort of upsizers and investors drawn to the project’s location and design credentials. 
&nbsp; 
The milestone sale comes as the project, developed by&nbsp;<a href="https://www.apartments.com.au/developers/perifa">Perifa</a>&nbsp;and delivered by <a href="https://www.apartments.com.au/builders/versatile-made-construction">Versatile Construction</a>, both part of Versatile Group, reaches 60 per cent sold.

[smartcode_project:default project_id=6680 project_image_fid=371325] 
&nbsp; 
Eddie Mansour, Managing Partner of <a href="https://www.apartments.com.au/project-marketer/ray-white-projects">Ray White Projects</a>, said the result demonstrates not only a headline price but also depth of demand. 
&nbsp; 
“This is an exceptional outcome and a clear reflection of sustained buyer demand for premium, well-located downsizer product,” Mansour said.

“We’re seeing a consistent pattern of local homeowners selling family residences and reinvesting into high-quality apartments that allow them to remain within their community. Alex &amp; Willow has resonated strongly with this group because it offers genuine scale, thoughtful design and immediate proximity to the village.” 
&nbsp; 
The sale reflects a broader and consistent trend of local downsizers actively seeking high-quality, low-maintenance residences close to established village centres. Agents report that demand for this product type has remained resilient, particularly where developments offer a rare combination of scale, design quality and walkable amenity. 
&nbsp;&nbsp; 
Fabrizio Perilli, Managing Director of Perifa and Versatile Group, said the sale marks a defining moment for the project. 
&nbsp; 
“The penthouse sale is a strong endorsement of the quality we have delivered, alongside our partners, and the clear demand from local downsizers for premium, boutique residences in this location,” Perilli said.&nbsp; 
&nbsp; 
“Most importantly, we’re proud to see the Alex &amp; Willow community beginning to take shape. As we move closer to completion, we’re looking forward to welcoming residents and seeing the project come to life.”&nbsp;

[smartcode_project:default project_id=6680 project_image_fid=338516] 
&nbsp; 
Designed by <a href="https://www.apartments.com.au/architects/nettletontribe">Nettleton Tribe</a> with interiors by <a href="https://www.apartments.com.au/interior-designers/richards-stanisich">Richards Stanisich</a>, Alex &amp; Willow is a boutique collection of generously sized two- and three-bedroom residences in the heart of Crows Nest village.&nbsp;

Completion is slated for early 2027.

[smartcode_project_cta:default project_id=6680]

Alex & Willow, Crows Nest penthouse sells off the plan for $6.5 million

Fresh from launching the first stage of its Wollongong precinct, <a href="https://www.apartments.com.au/new-apartments/keira-place-wollongong-120-122-smith-street-wollongong-nsw-2500">Keira Place</a>, builder-developer Urban Property Group has unveiled plans for the next phase of the masterplanned community.

Now on public exhibition through the NSW Government's Housing Delivery Authority pathway is a State Significant Development Application for a further 657 homes on the prominent gateway site opposite Beaton Park.

The proposal comprises three buildings, including two build-to-sell towers rising 25 and 30 storeys, delivering 391 apartments, alongside a 12-storey co-living building with 266 residences, making it one of the largest co-living proposals currently planned in regional New South Wales.

Of the apartments proposed in the build-to-sell towers, the majority, 310, are two-bedroom dwellings. The balance comprises 44 one-bedroom apartments and 37 three-bedroom residences. Apartment sizes range from around 50 sqm for one-bedroom homes to approximately 90 sqm for three-bedroom apartments.

<img alt="Smith St" data-entity-type="file" data-entity-uuid="19347059-1612-41a0-9c74-b86a657237f8" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-06-10%20at%2010.02.18%E2%80%AFAM.png?VersionId=sWXnaCcA.cIC6N8YT1dg5pJ2e1V3Z6z7" />

The submission says the proposal has evolved significantly from its original Housing Delivery Authority application following extensive consultation with the State Design Review Panel and Wollongong City Council.

The final scheme has been designed to align with the emerging vision for the Flinders Street Precinct, an area identified by Council as a future high-density mixed-use neighbourhood capable of accommodating substantial housing growth close to transport, employment and community infrastructure.

According to the design report prepared by COX Architecture, the development aims to "deliver a built outcome consistent with the future character of the Wollongong CBD while responding to the site's unique constraints and opportunities."

"Our vision for the next phase of the site evolution in Wollongong is grounded in three design pillars that guide the design response: place, natural environment and celebration," COX said.

"Inspired by its surroundings and grounded in the stories of place on Wodi Wodi Country, the design proposal acknowledges the established character of its setting while creating a unique and timeless identity that sits harmoniously within it.

"The design proposal responds to its specific site conditions, acknowledging the vegetation, climate, wind conditions and solar access of the site."

The architecture responds directly to the site's position between Wollongong's urban core and its natural landscape setting.

COX identified views towards Mount Keira and the Illawarra Escarpment as defining features of the site, while the upper levels of the towers will also capture expansive views across the city and out to the Pacific Ocean.

The design team has positioned the tallest buildings closer to the rail corridor, where overshadowing impacts can be better managed while establishing a landmark built form on the northern approach into the city.

<img alt="Smith St" data-entity-type="file" data-entity-uuid="79580d5b-500c-4ebf-9629-797146a4a694" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-06-10%20at%209.51.59%E2%80%AFAM.png?VersionId=WbTB1EKSG.KDfsfz0F3wp1QVa2oCMGR5" />

Urban Property Group secured the 11,000 sqm Smith Street site in 2022 and has since progressed plans for the broader Keira Place precinct.

Construction recently commenced on the first stage of Keira Place, which will deliver 150 apartments across two residential buildings, including 27 affordable housing apartments and 18 specialist disability accommodation dwellings, alongside activated ground-floor retail and commercial space.

Urban Co-CEO Patrick Elias said the commencement of construction marked a significant milestone for Wollongong and reflected the developer's long-term commitment to regional cities.

"Today's groundbreaking is about turning approvals into homes and moving quickly to deliver much-needed housing in Wollongong's city centre," Elias said.

"Keira Place will provide a diverse mix of homes close to jobs, transport and services, while setting a high benchmark for quality, durability and consumer protection."

Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/groundbreaking-marks-start-of-construction-at-keira-place-in-wollongong-cbd">Groundbreaking marks start of construction at Keira Place in Wollongong CBD</a>

&nbsp;

&nbsp;

&nbsp;

Urban Property Group unveils trio of towers for next stage of new Wollongong precinct, Keira Place

Central Element is seeking approval for a significant residential redevelopment in Lavender Bay, lodging plans for a dual-tower apartment project that would deliver 163 new homes on a prominent site at the northern gateway to Milsons Point.

The Sydney-based builder-developer has lodged a concurrent rezoning proposal and State Significant Development Application for <a href="https://www.apartments.com.au/new-apartments/64-66-lavender-street-lavender-bay-nsw-2060">64-66 Lavender Street and 3-7 Middlemiss Street</a>, a 2,305 sqm amalgamated site currently occupied by a collection of ageing residential flat buildings.

Designed by SJB, the proposal would replace the existing 32 apartments with two residential towers rising 23 and 32 storeys, comprising 163 apartments including affordable housing managed by a community housing provider. The project forms part of the NSW Government's Housing Delivery Authority program and has been progressing through a fast-tracked state planning pathway since being endorsed for further assessment in 2025.

The proposal is one of the most significant redevelopment opportunities currently under consideration on Sydney's lower north shore, sitting between the high-density towers of Milsons Point and the lower-scale heritage fabric of Lavender Bay.

<img alt="Lavender Bay" data-entity-type="file" data-entity-uuid="93ecf0ee-487d-4292-afc4-0bc9579475d6" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-06-10%20at%209.30.48%E2%80%AFAM.png?VersionId=PunU2ipMaTxiJcJ8NdMyUlWA7d98eNUb" />

The planning proposal seeks a substantial uplift from the current 12 metre height limit, which would only allow for a four-storey building, however the submission argues a scheme within these limits would not be&nbsp;economically feasible given the complexity of site amalgamation and would fail to maximise housing delivery on land located within walking distance of major transport infrastructure.

SJB said the design evolved significantly following discussions with the Department of Planning, Housing and Infrastructure and independent design review processes.&nbsp;Rather than pursuing a single larger tower, the architects adopted a two-tower approach aimed at reducing perceived bulk, preserving view corridors and creating greater permeability at ground level.

The northern tower would rise 23 storeys and contain 81 apartments, while the southern tower would reach 32 storeys and accommodate 82 apartments. Five basement levels would provide 174 car spaces, 181 bicycle spaces and 10 motorcycle spaces.

"The proposal for 3–7 Middlemiss Street and 64–66 Lavender Street is driven by a clear ambition to complete the Middlemiss Peninsula, delivering the final piece of a carefully evolving urban precinct," SJB noted in its design report.

"Positioned at the threshold between Lavender Bay and the North Sydney CBD, the development is envisioned as a unifying element—one that completes the skyline composition while providing a considered and harmonious transition between the peninsula’s established character and the intensity of the CBD beyond.

"Collectively, the development aspires to create a landmark that is generous, inclusive, and deeply connected to its setting, one that enhances the skyline, strengthens the public realm, and contributes to a more equitable and sustainable urban future."

Communal spaces would be distributed across multiple levels, including landscaped podium gardens, swimming pool facilities, barbecue areas and rooftop-style retreat spaces designed for residents. The proposal delivers more than 1,500 sqm of communal open space and nearly 400 sqm of indoor communal facilities.

<img alt="Central Element" data-entity-type="file" data-entity-uuid="0671c276-6dd8-4cfc-97b0-134a45d2c8cf" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-06-10%20at%209.30.17%E2%80%AFAM.png?VersionId=90D7lRaCTMTsFx92tIBrHlZcuaV_a4cw" />

A major focus of the planning assessment has been the project's relationship with surrounding public open spaces.

Clark Park, Bradfield Park and Wendy Whiteley's Secret Garden are among the lower north shore's most valued public landscapes, and overshadowing impacts have been closely examined through the design process. Central Element is proposing to also create a new public plaza and pocket park as part of the development.

Central Element has been developing across Sydney since 2010.

They have recently completed their Chatswood tower, Ethos Chatswood, as well as their luxury redevelopment of Coogee's landmark Ballamac House. They are currently selling Pearl Bondi, just seven high-end homes, while future plans include a tower on Hyde Park, and a boutique project in Neutral Bay.

Yolanda Redrup

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