Ron Bakir's Homecorp has sold more than 75 per cent of the apartments in its wellness-driven Florence Residences in Surfers Paradise following its first weekend release.

The <a href="https://www.apartments.com.au/new-apartments/florence-residences-24-monte-carlo-avenue-surfers-paradise-qld-4217">26-storey project on Monte Carlo Avenue</a>, which commenced construction earlier this year, has seen a flurry of buyers secure their slice of the Gold Coast's latest wellbeing-focused offering in one of the nation's most competitive property markets.

Since the pandemic, the Gold Coast's population has grown by more than 11 per cent, a rate approximately four times faster than Sydney's, driven largely by lifestyle changes and interstate migration. While buyer activity has moderated in some markets nationally, demand for newly built dwellings on the Gold Coast continues to gain momentum as purchasers increasingly prioritise lifestyle, amenity, wellbeing, liveability and long-term investment potential.

&nbsp;

[smartcode_project:default project_id=150414 project_image_fid=372743]

Homecorp CEO Ron Bakir says buyers today are looking for more than just a home.

"What we are seeing is a shift in how people define value in property," Bakir says.

"What attracts residents to new developments is a desire for more than just a residence. They are looking for a place that complements their lifestyle, supports their wellbeing and reflects the way they want to live into the future.

"Lifestyle, longevity, proactive health, wellbeing, connection and a sense of community are increasingly shaping purchasing decisions, particularly on the Gold Coast, where these factors continue to be a major drawcard."

[smartcode_project:default project_id=150414 project_image_fid=372744]

Bakir says Homecorp is responding to this shift through an approach that places greater emphasis on design, amenity and experience working together to create places that feel considered, connected and enduring in value.

Inspired by Eastern European design, Florence Residences will comprise 120 apartments alongside a private residents-only wellness club featuring a resort-style rooftop pool, hot and cold plunge pools, a spa retreat, contemporary gymnasium, and a spacious yoga and Pilates studio.

The development will also feature a residents-only lounge with private dining facilities and a rooftop bar, premium outdoor entertaining areas, a hotel-style lobby lounge, generous bike parking, and pet-friendly amenities including a heated dog wash.

[smartcode_project:default project_id=150414 project_image_fid=372742]

A limited number of apartments remain available, with an exclusive collection of four-bedroom sub-penthouses set to be released in the coming months.

Florence is one of the latest additions to Homecorp's expanding multi-billion-dollar property portfolio, which also includes plans for a <a href="https://www.apartments.com.au/news/qld/homecorp-lodges-plans-for-260-million-moroccan-bathhouse-inspired-tower-in-budds-beach">$260 million development in Budds Beach</a> tailored to the growing wellness market.

A development application has been lodged for a 27-storey, 156-residence tower at 8–10 Acacia Avenue and 25–27 Oak Avenue, featuring a residents-only Moroccan spa-inspired sanctuary.

Apartments at Florence Residences are priced from $1,249,000, with construction expected to be completed by late 2027.

[smartcode_project_cta:default project_id=150414]

Joel Robinson

Buyers rush to Homecorp's Florence Residences as Gold Coast wellness trend gains momentum

The NSW Government has expanded its $1 billion Pre-sale Finance Guarantee program, broadening access for affordable housing providers and smaller residential developments as it seeks to accelerate housing delivery across the state.

The Minns Government says the program has already helped bring forward more than 600 homes across Sydney and regional NSW since launching in September 2025, with similar models now adopted in South Australia and Western Australia.

The latest changes, announced by Treasurer Daniel Mookhey and Minister for Planning and Public Spaces Paul Scully, are designed to improve access to finance for projects that have planning approval but are struggling to secure funding.

Among the key changes is an expansion of support for community housing providers. The program will now support up to 100 per cent affordable housing projects valued at up to $30 million when delivered by not-for-profit providers, while support for larger affordable housing developments will increase for projects worth up to $80 million.

The government says the changes will help accelerate the delivery of housing for low-income workers, older people, people living with disability, and those at risk of homelessness, while reducing reliance on direct grants or subsidised loans to bridge funding gaps.

The eligibility criteria for smaller residential developments have also been broadened. The previous $5 million minimum project value threshold has been removed and replaced with a requirement that projects deliver at least four homes.

Support has also increased for projects delivering fewer than 20 homes, with the guarantee now able to cover up to 75 per cent of dwellings in a development, capped at $30 million per project.

The changes are expected to particularly benefit smaller-scale and regional developments, which often face greater challenges meeting pre-sale requirements imposed by lenders.

Treasurer Daniel Mookhey said the scheme demonstrates how government can use its balance sheet to stimulate housing supply without relying solely on taxpayer-funded grants.

"The Pre-sale Finance Guarantee shows how this Government is using its balance sheet to reduce risk and unlock private investment, enabling new homes to move from design to construction faster," Mookhey said.

"This landmark reform allows us to deliver homes for working families at a lower cost to taxpayers, while also maintaining strong financial discipline."

Planning Minister Paul Scully said the program had already proven effective in bringing stalled projects to market.

"The Pre-sale Finance Guarantee has already proven it can unlock stalled projects and accelerate housing delivery by giving lenders the confidence they need to back good developments," Scully said.

"These changes will allow more affordable housing and smaller developments to access support so more homes can be built faster where communities need them most."

Housing Minister Rose Jackson said the expansion would help community housing providers overcome financing barriers that often delay projects.

"We know community housing providers are ready to build more homes, too often they're held back by barriers to finance," Jackson said.

"Expanding the Pre-sale Finance Guarantee helps remove those barriers so more affordable homes can get off the ground sooner."

The announcement was welcomed by the Property Council of Australia, which has long advocated for measures aimed at improving project feasibility and access to finance.

Property Council NSW Executive Director Katie Stevenson described the expansion as a practical intervention that addresses one of the most immediate constraints on housing delivery.

"This is exactly the kind of practical intervention we need right now, focused on getting projects out of the ground, not just approved," Stevenson said.

"It builds on a model the Property Council has worked closely with government to develop following calls for such a scheme ahead of last year's NSW Budget, so it's great to see it being expanded."

Stevenson said the reforms would help unlock projects that are ready to proceed but have been delayed by financing challenges. However, she noted that broader feasibility issues remain a significant barrier to increasing housing supply.

"The biggest challenge in NSW housing today is delivery. Too many projects have planning approval but are simply not financially viable to proceed under current settings," she said.

Speaking at the Property Council's NSW Housing Summit, Housing Minister Rose Jackson acknowledged that feasibility and financing pressures continue to constrain housing delivery, while reaffirming the government's commitment to work with industry on solutions.

Stevenson said the government's recognition of those challenges was encouraging ahead of next week's state budget.

"It's positive to see the government clearly recognising that feasibility pressures are now a binding constraint on supply," she said.

"With the Budget just days away, the focus must be on backing delivery, making sure projects stack up, finance can flow, and more homes can move from approval to construction."

The expanded Pre-sale Finance Guarantee forms part of the NSW Government's broader housing agenda, which also includes planning reforms, the NSW Housing Pattern Book, and a series of rezonings intended to increase housing capacity across the state.

NSW expands Pre-sale Finance Guarantee to unlock more affordable and regional housing

Design-led developer-builder Lowe Living has unveiled its latest residential development, Jardin House, marking its first foray into Melbourne's blue-chip City of Boroondara.

Located a short walk from Camberwell Junction, <a href="https://www.apartments.com.au/new-apartments/jardin-house-by-lowe-living-camberwell-335-camberwell-road-camberwell-vic-3124">Jardin House</a> has been designed to appeal to affluent local downsizers and established families seeking a low-maintenance alternative to the large homes that have long defined Camberwell and surrounding suburbs.

The project will comprise a collection of two and three-bedroom apartments ranging from 92 sqm to 280 sqm, alongside a limited number of penthouse residences featuring rooftop terraces spanning more than 100 sqm, with optional private pools.

&nbsp;

[smartcode_project:default project_id=146717 project_image_fid=372212]

Lowe Living Co-Founder and Managing Director Tim Lowe said Camberwell represented a natural next step for the developer as it expands into some of Melbourne's most tightly held residential markets.

"Jardin House is an important project for our team as it marks the next evolution of our portfolio into different well-established blue-chip pockets of Melbourne," Lowe said.

"Camberwell, with its incredible walkability, family-led neighbourhood feel and superb access to education and transport, makes it a natural choice for us."

[smartcode_project:default project_id=146717 project_image_fid=372227]

Designed by Tristan Wong Architects, with interiors by Hecker Guthrie and landscaping by Acre, the development takes inspiration from the Art Deco architecture that remains a defining feature of many of Camberwell's established streets.

A curved facade, arched openings, textured brickwork and sculpted forms reference the suburb's architectural heritage, while extensive landscaping softens the building's presence and creates a strong connection to the surrounding tree-lined streetscape.

The project will be set behind a secure gated entrance, with residents arriving through landscaped gardens designed to create a transition between the public realm and private residences.

Inside, the residences feature natural stone and timber finishes, full-height glazing, Miele appliances and generous open-plan living areas designed for long-term owner occupation.

[smartcode_project:default project_id=146717 project_image_fid=372225]

While the apartments themselves have been designed to attract discerning owner-occupiers, it is the amenity offering that sets Jardin House apart from many other boutique projects currently launching across Melbourne.

The centrepiece is a 350 sqm private bathhouse curated in partnership with Aurora Spa &amp; Bathhouse founder Lyndall Mitchell.

The wellness precinct includes mineral pools, hydrotherapy experiences, a Himalayan salt room, sauna, steam room, cold plunge pools and dedicated relaxation spaces, creating what Lowe Living describes as a private wellness retreat exclusively for residents.

[smartcode_project:default project_id=146717 project_image_fid=372222]

The collaboration follows Lowe Living's recent partnership with Aurora at Maison Savoy in Brighton, although Jardin House is the first project to incorporate both indoor and outdoor wellness experiences.

Emma Lowe, Co-Founder and Managing Director of Lowe Living, said wellness was becoming an increasingly important consideration for apartment buyers.

"Collaborating with Lyndall Mitchell from Aurora Spa &amp; Bathhouse for a second time is an intentional nod to creating residences that are more than just homes, but a way to enrich the lives of our residents through wellness and longevity," Lowe said.

The amenity offering is complemented by a Technogym fitness studio, residents' lounge, private dining spaces and concierge services.

The launch comes as developers increasingly target Melbourne's established eastern suburbs, where rising land values, ageing housing stock and growing downsizer demand are creating opportunities for boutique apartment projects.

Lowe said the company expects significant generational wealth transfer across suburbs such as Camberwell in coming years, creating further demand for luxury apartment living.

"Camberwell is a blue-chip suburb where homes regularly transact for multiple millions of dollars," he said.

"The generational change of wealth in these locations expected in the coming years is significant, so we see an opportunity to create exclusive residences that appeal to older families and downsizers in order to meet this demand."

Apartments at Jardin house start from $1,195,000. The project forms part of Lowe Living's near-$1 billion portfolio of new developments across Melbourne.

[smartcode_project_cta:default project_id=146717]

Lowe Living launches Jardin House in Camberwell

As <a href="https://www.apartments.com.au/developments/north-sydney-nsw-2060">North Sydney</a> continues its transition from a commercial centre into a more layered residential and lifestyle precinct, a new generation of apartment developments is reshaping expectations around scale, amenity, and long-term liveability.

Improved transport connections through the Victoria Cross Metro, continued investment in dining and public spaces, and a constrained supply of new luxury apartments have sharpened demand for homes that combine proximity to the CBD with the privacy and outlook traditionally associated with harbourside houses.

At 177 Walker Street, <a href="https://www.apartments.com.au/developers/aland">ALAND</a>’s new apartment development <a href="https://www.apartments.com.au/new-apartments/the-walden-north-sydney-177-walker-street-north-sydney-nsw-2060">The Walden</a> enters the market with a distinctly residential approach to high-rise living. The 30-level tower will deliver 161 residences, ranging from one-bedroom apartments through to sub-penthouses and a full-floor penthouse, all oriented to capture uninterrupted views across Sydney Harbour, the Opera House, and out toward the Pacific Ocean.

[smartcode_project:default project_id=134323 project_image_fid=6395]

Designed by <a href="https://www.apartments.com.au/architects/rothelowman">Rothelowman</a>, the project takes advantage of the site’s natural topography and elevated position above the harbour. Rather than relying on density alone, the architecture focuses on outlook, orientation, and spatial flow, with every apartment occupying a corner position to maximise natural light and cross ventilation.

Rothelowman says the site itself shaped much of the architectural response.

“The site has a long history in terms of its inevitable transformation and when we came in, we took inspiration from the idea of reestablishing a sense of the site’s natural terrain and fall. Our scheme aims to integrate with the terrain and the landscape, using the undulating site to slowly reveal glimpses and views of the harbour. The rotation of the tower off grid means every apartment has a view and is naturally cross ventilated. The building's colour palette is quintessentially Sydney, with bronze and sandstone and a luminescent green colour in the glass, making it very earthy and grounded in its location.”

[smartcode_project:default project_id=134323 project_image_fid=6399]

Inside the residences, the emphasis moves toward larger-format living typically associated with standalone homes. Kitchens sit at the centre of the apartments, connecting directly to open-plan dining and living areas before extending outward into expansive winter gardens and balconies. Calacatta marble, bespoke joinery, integrated appliances, and custom metal detailing are used throughout, while three distinct interior palettes, Terrace, Opera, and Harbour, allow buyers to personalise the spaces without compromising the architectural consistency of the project.

The larger residences place particular attention on separation between entertaining and private zones. In many apartments, master suites occupy the outer corners of the floorplates, allowing bedrooms to benefit from floor-to-ceiling glazing and harbour outlooks independent of the living spaces. Dressing rooms and ensuites continue the material palette through fluted detailing, freestanding baths, and layered stone finishes.

Rothelowman says the design intent centred on creating homes that feel enduring rather than transient.

“Our philosophy is all about the way people live in these spaces, and we wanted to create homes that reflect the quality of life in this unique Sydney location. The apartments showcase expansive living spaces that are generous, sophisticated, and bold, with the ability to connect with views throughout each apartment.”

[smartcode_project:default project_id=134323 project_image_fid=353235]

A separate four-storey amenity building known as The Pavilion expands the residential offering beyond the apartments themselves. Positioned alongside the tower, the building consolidates wellness, recreation, and social spaces into a dedicated resident retreat. Facilities include a 20-metre rooftop pool and sundeck, sauna, spa, ice bath, wellness studio, gymnasium, concierge service, wine cellar, residents’ lounge, private dining spaces, and dedicated co-working areas with meeting rooms and boardroom facilities.

The amenity mix reflects the buyer profile emerging in North Sydney, where owner-occupiers and downsizers are increasingly prioritising convenience, apartment scale, and long-term usability over purely investment-driven decisions.

The Walden also represents a significant milestone for ALAND, marking the company’s first major move into Sydney’s inner-city luxury apartment market after more than two decades delivering large-scale residential communities across Greater Sydney. Founder Andrew Hrsto says the Walker Street site stood apart because of both its positioning and its rarity.

[smartcode_project:default project_id=134323 project_image_fid=6390]

“As a company, we had been searching for a site in one of Sydney’s blue-chip locations, spanning the Eastern Suburbs, the Sydney CBD and the North Shore, and when we had the opportunity to purchase this site, we immediately recognised that it could be something iconic.”

At launch, The Walden recorded more than $103 million in sales, with buyers drawn to the project’s harbour positioning, apartment scale, and proximity to the Metro, which now connects North Sydney to Barangaroo in three minutes and Martin Place in five.

ALAND has commenced construction, and is expecting a completion date in 2028.

[smartcode_project_cta:default project_id=134323]

The Walden pairs house-scale living with North Sydney connectivity

The ACT will become the first jurisdiction in Australia to abolish stamp duty for all first home buyers, with no income caps and no property price thresholds from 1 July.

The move, announced as part of the ACT Budget, completes a key election commitment from the Barr Government and removes what Chief Minister Andrew Barr described as one of the biggest barriers to entering the housing market. The reform forms part of the ACT's long-running transition away from transaction taxes and towards a broader-based property tax system.

"This budget marks a major milestone in our long-term tax reform program," Barr said, adding that the government had maintained a sustained focus on removing barriers to home ownership. He said stamp duty had long been one of the largest upfront hurdles facing buyers and that from July, "that barrier is gone" for first home buyers in the Territory.

[smartcode_project:default project_id=139989 project_image_fid=350986]

The changes come alongside a range of measures designed to encourage new housing supply, including support for the delivery of so-called "missing middle" housing such as terraces, townhouses and low-rise multi-unit developments.

The announcement has renewed debate around whether the ACT's approach could provide a blueprint for improving housing affordability nationally.

New research from OurTop10.com.au, conducted by Primara Research, suggests the Territory's decade-long reform agenda has produced outcomes unmatched elsewhere in Australia.

While stamp duty costs have increased by an average 67 per cent nationally over the past decade, the ACT has recorded growth of just 15 per cent, the lowest increase of any jurisdiction.

The Territory has also emerged as one of the strongest performers on housing delivery. Based on population-weighted housing targets, the ACT is sitting less than one per cent behind its target. Victoria is the next closest at seven per cent behind, while the national average sits 25 per cent below target. New South Wales is tracking 39 per cent behind.

The latest reform removes one of the final barriers facing first home buyers in Canberra.

[smartcode_project:default project_id=139989 project_image_fid=359152]

The average Australian home buyer currently pays $61,714 in stamp duty. In the ACT, that figure is $38,399 despite the Territory having the third-highest median house price in the country.

Until now, the ACT's first home buyer concession scheme only applied to purchases up to $1.02 million, around $51,000 below Canberra's median house price of $1.071 million. In practical terms, many first home buyers were unable to access the median-priced home without losing the concession.

From July, those restrictions disappear.

Every first home buyer in the ACT will pay no stamp duty, regardless of income or purchase price.

Canberra remains one of Australia's most expensive housing markets, with dwelling values increasing 82 per cent over the past decade. However, that growth ranks only 11th among Australia's 15 major housing markets, suggesting affordability pressures have been less severe than in many other parts of the country.

Simon Ma, CEO of OurTop10.com.au, said the latest reforms recognise that many first home buyers have simply outgrown thresholds set years ago.

"Many first home buyers aren't just looking for a way onto the ladder, they want a home their family can actually live in," Ma said.

"In a market where the median house price is over a million dollars, a concession scheme that cuts out at $1.02 million was never going to get them there.

"Removing the ceiling entirely means ACT first home buyers can now pursue the home they actually want, rather than limiting themselves to a price point designed for a very different market."

Whether other states follow remains to be seen. But at a time when most jurisdictions are struggling to improve affordability while also increasing housing supply, the ACT has quietly become the national test case for both.

15% stamp duty growth. Just 1% off the national housing target. Zero stamp duty for FHBs. Is the ACT the blueprint for the great Australian dream?

ACT abolishes stamp duty for first home buyers

Sydney’s property market is known for high prices, competitive bidding, and mounting pressure on first home buyers. But change is on the horizon.

From late 2025, eligible first home buyers in New South Wales will have access to a new federal government initiative aimed at addressing affordability: the Help to Buy Scheme.&nbsp;

<h2>What is the Help to Buy Scheme?</h2>

The program introduces a shared equity model intended to reduce the upfront cost of entering the property market, particularly in high-demand urban areas such as Sydney.

The scheme operates under a shared ownership structure in which the federal government takes an equity stake of up to 40 per cent for new homes, or 30 per cent for existing dwellings. This arrangement allows eligible buyers to significantly reduce their loan size and avoid the added cost of Lenders Mortgage Insurance (LMI).

Under this model, purchasers can enter the property market with as little as a two per cent deposit, well below the traditional 10 to 20 per cent usually required. The government’s contribution is not a loan but a co-ownership stake in the property. As such, there is no interest or rent charged on its portion.

Because the government’s equity combined with the buyer’s deposit typically meets or exceeds the 20 per cent threshold, LMI does not apply. The remaining balance, generally between 60 and 70 per cent of the property’s value, is financed through a standard home loan with a participating lender.

The government's equity in the property remains in place until the buyer chooses to repay it voluntarily or until the property is sold. Buyers can buy back the government’s share over time, in increments of at least five per cent, depending on their financial situation.

There is no fixed repayment timeline, but the amount to be repaid will be based on the property's market value at the time of repayment, not the original purchase price.

<h2>How do you qualify for the&nbsp;Help to Buy Scheme?</h2>

To qualify for the Help to Buy Scheme, applicants must meet the following conditions:

<ul>
	<li>Be an Australian citizen at least 18 years of age.</li>
	<li>Be a first-home buyer who does not currently own property.</li>
	<li>Intend to live in the property as their primary residence.</li>
	<li>Earn less than $100,000 per year for individuals, or $160,000 for couples.</li>
	<li>Purchase a property within the regional price caps, currently $950,000 in Sydney, though this is expected to rise to approximately $1.3 million ahead of the program’s launch.</li>
</ul>

While the Help to Buy Scheme does not solve affordability challenges across the board, it does offer a more accessible pathway for a defined segment of the market, particularly younger buyers with moderate incomes who have been priced out of traditional lending routes.

The scheme is expected to commence in NSW in late 2025, as part of a national rollout.

Under the new model, purchasers can enter the property market with as little as a two per cent deposit, well below the traditional 10 to 20 per cent usually required

Help to Buy Scheme: What first home buyers in NSW need to know

The First Home Owners Grant (FHOG) is a government initiative designed to help eligible first-time home buyers by offering financial assistance towards the purchase or construction of a new home.

While the FHOG is a nationwide program, it is administered separately by each state and territory, meaning the eligibility criteria, grant amounts, and property requirements can vary depending on your location. This means that the amount available and the conditions attached to the grant will differ, so it is important to check the specific guidelines for your state or territory.

It’s important to note that the FHOG is just one of several incentives available to first home buyers. In most states and territories, the grant is not linked to stamp duty exemptions or concessions, with the exception of the Australian Capital Territory (ACT). The FHOG is typically a one-off payment, reducing the overall cost of purchasing or building a new home before any stamp duty concessions are applied.

Below, we provide a breakdown of the First Home Owner Grants available across Australia, outlining the specific details for each state and territory.

<h2>New South Wales First Home Owner Grant</h2>

First Home Owner Grant: Offers a $10,000 grant for new homes valued up to $600,000. For land purchases and owner-builders, the threshold extends to $750,000.

Stamp Duty Benefits: Provides full stamp duty exemption for homes valued up to $800,000, with concessions available for properties up to $1 million.

<h2>Victoria South Wales First Home Owner Grant</h2>

First Home Owner Grant: Provides a $10,000 grant for first-home buyers purchasing or building new homes valued up to $750,000.

Stamp Duty Benefits: Offers full stamp duty exemption for properties up to $600,000, with concessions available up to $750,000.

<h2>Queensland First Home Owner Grant</h2>

First Home Owner Grant: Offers $30,000 for contracts signed between 20 November 2023 and 30 June 2025. The FHOG applies to new homes valued up to $750,000.

Stamp Duty Concessions: Provides additional concessions for properties valued up to $800,000.

<h2>Western Australia First Home Owner Grant</h2>

&nbsp;

First Home Owner Grant: Offers a $10,000 grant for new homes valued up to $750,000 in the southern regions and up to $1 million in the northern regions.

Stamp Duty Concessions: Available for homes valued up to $600,000 for transactions entered into on or after 9 May 2024.

<h2>Australian Capital Territory First Home Owner Grant</h2>

First Home Owner Grant: Replaced by the Home Buyer Concession Scheme, offering full stamp duty concessions for eligible buyers.

<h2>South Australia First Home Owner Grant</h2>

First Home Owner Grant: Provides up to $15,000 for new homes, including houses, apartments, and townhouses. As of 6 June 2024, there is no property value cap for eligibility.

Stamp Duty Relief: Available for new homes and vacant land purchases.

<h2>Tasmania First Home Owner Grant</h2>

First Home Owner Grant: Offers a $10,000 grant for new homes and off the plan purchases.

Stamp Duty Exemption: Between 18 February 2024 and 30 June 2026, first home buyers of established homes valued up to $750,000 receive a full exemption on property transfer duty.

<h2>Northern Territory First Home Owner Grant</h2>

First Home Owner Grant: The Northern Territory provides a $10,000 grant for new homes only. Additional government grants and concessions are available for first home buyers.

Stamp Duty Exemption: The only stamp duty exemption available to property buyers is the House and Land Package Exemption (HLPE).

Eligibility criteria and application processes differ across states. Prospective buyers should refer to their respective state revenue offices for full details on grant availability, conditions, and additional concessions.

Every First Home Owner Grant for new property by state

In the ever-evolving landscape of sustainable architecture and environmentally conscious design, systems and ratings in place can help determine the energy efficiency of residential buildings in Australia.

Australia has multiple building rating systems that evaluate energy efficiency and sustainability in existing and new building designs.

Some systems assess individual building components, while others provide an overall rating for the entire structure.

A rating system ensures that homes are comfortable and energy-efficient, whether you are buying, renovating, or building.

NatHERS (Nationwide House Energy Rating Scheme) is a common way for new homes to meet energy efficiency requirements.

As new developments continue to shape the urban environment, understanding NatHERS ratings becomes essential for developers and homeowners. This article delves into the concept of NatHERS ratings, their significance, and how they contribute to creating energy-efficient homes.

<h2>What is NatHERS?</h2>

NatHERS is a national initiative implemented by the Australian government to promote energy efficiency in residential buildings. The scheme aims to provide a standardised method for assessing the thermal performance of homes, considering factors such as insulation, orientation, ventilation, and building materials.&nbsp;

NatHERS ratings are the most common way new homes meet the National Construction Code's (NCC's) minimum energy efficiency requirements.&nbsp;

NatHERS assessments provide thermal and whole-home ratings for new homes, townhouses, and apartments.

The rating helps evaluate the energy performance of buildings, guides homeowners and developers to make informed decisions about the energy efficiency of their properties, and encourages the construction of more sustainable, comfortable, and cost-effective homes.

<h2>How NatHERS Ratings Work</h2>

NatHERS ratings are determined through four accredited software tools (AccuRate, BERS Pro, FirstRate5, HERO) using a calculation engine CSIRO developed to predict building temperature based on various factors.

The tools can model complex effects of building mass, insulation, window size, and other elements.

The outcome is a star rating that reflects the building's overall thermal efficiency, indicating how well it can maintain a comfortable indoor temperature without excessive reliance on heating or cooling systems.

The star rating scale ranges from 0 to 10, with a 6-star rating being the minimum requirement for compliance with the National Construction Code (NCC).&nbsp;

Achieving a higher star rating demonstrates a commitment to energy efficiency and sustainability, as the building is better equipped to minimise its environmental impact and reduce long-term energy costs.

Anyone can use NatHERS tools, but accredited assessors can provide certified ratings and professional advice.

<h2>Benefits of Higher NatHERS Ratings</h2>

Energy Efficiency: Buildings with higher NatHERS ratings are more energy-efficient, requiring less heating and cooling energy. This reduces the structure's carbon footprint and lowers occupants' energy bills.

Cost Savings: Homes with higher NatHERS ratings are generally more energy-efficient, resulting in reduced energy consumption for heating and cooling. This translates to lower energy bills for homeowners, making sustainable living environmentally friendly and economically viable in the long run.

Environmental Impact: Lower energy consumption directly translates to a reduced environmental impact. Buildings with higher NatHERS ratings contribute to the overall goal of mitigating climate change by lowering greenhouse gas emissions associated with heating and cooling systems.

Improved Comfort: Buildings with high NatHERS ratings offer better thermal comfort to occupants. Proper insulation, well-designed ventilation, and optimal orientation maintain a consistent and comfortable indoor temperature, providing occupants with a more enjoyable and healthier space.

Market Value and Desirability: Higher NatHERS ratings can enhance the market value of a property. As energy efficiency becomes a more significant consideration for homebuyers, a well-rated building may attract a premium price and stand out in the real estate market.

Compliance with Building Codes: NatHERS ratings are a vital component of the National Construction Code (NCC), and compliance with these ratings is often a mandatory requirement for new developments. Local councils and planning authorities may set minimum energy efficiency standards that must be met to obtain development approval.

The Nationwide House Energy Rating Scheme (NatHERS) is a crucial initiative shaping the future of energy-efficient, resilient, and cost-effective homes. With its recent upgrades, NatHERS has evolved into a world-leading tool for the building sector, supporting the global commitment to achieving net-zero emissions by 2050.

Staff Writer

What is a NatHERS rating in new off the plan apartment developments?

Mixed-use developments have gained significant popularity across Australia in recent years due to their unique blend of residential, commercial, and recreational spaces.

Unlike traditional single-purpose developments, mixed-use projects offer a harmonious integration of various functions within a single locale.

Residential units seamlessly coexist with commercial establishments, retail outlets, dining venues, entertainment hubs, and recreational facilities, with the combination not only enhances convenience but also fosters a vibrant lifestyle and a sense of community.

<h3>Convenience and accessibility</h3>

Mixed-use developments are designed with convenience in mind. They often integrate residential units with commercial spaces, retail outlets, restaurants, and recreational facilities, creating a self-contained community.

[smartcode_project:default project_id=114215 project_image_fid=204874]

The proximity allows residents to enjoy the convenience of having essential amenities and services within walking distance. Whether it's grabbing a cup of coffee, going grocery shopping, or accessing healthcare services, everything is conveniently located, saving residents time and effort.

<h3>Vibrant lifestyle and community</h3>

One of the major advantages of mixed-use developments is the vibrant lifestyle they offer. With a diverse range of amenities and communal spaces, residents have ample opportunities to interact, socialise, and build a sense of community.

[smartcode_project:default project_id=107714 project_image_fid=214122]

The presence of parks, community centres, and shared spaces fosters a lively atmosphere, encouraging residents to engage in various activities and events. The vibrant lifestyle within these developments creates a unique sense of belonging and camaraderie among the residents.

<h3>Potential for higher rental yields and property value appreciation</h3>

Mixed-use developments tend to attract a broad range of tenants and buyers due to their versatile nature. This high demand can result in higher rental yields for investors and potentially lead to property value appreciation over time.

[smartcode_project:default project_id=139989 project_image_fid=212887]

The integration of commercial and retail spaces attracts businesses, which can provide a stable rental income stream. Additionally, the popularity of mixed-use developments often drives up property values, making them a potentially lucrative investment in the long term.

<h3>Enhanced security and maintenance</h3>

Mixed-use developments typically have comprehensive security measures in place. With controlled access points, CCTV surveillance, and professional security staff, residents can enjoy enhanced safety and peace of mind.

[smartcode_project:default project_id=108019 project_image_fid=212658]

Additionally, these developments often have dedicated maintenance teams responsible for the upkeep of common areas, landscaping, and infrastructure. This ensures that the overall appearance and functionality of the development are well-maintained, creating a pleasant living environment for residents.

<h3>Live-work-play balance</h3>

One of the key attractions of mixed-use developments is the ability to achieve a desirable live-work-play balance. The integration of residential and commercial spaces allows residents to live closer to their workplaces, reducing commuting time and improving work-life balance.

The proximity to various amenities and recreational facilities encourages an active and healthy lifestyle. Residents can easily access fitness centres, parks, restaurants, and entertainment options, all within the same development, leading to a more fulfilling and convenient way of life.

alisonwarters@gmail.com

The top five reasons to buy in a mixed-use development

When buying a property, everyone needs to be aware of the additional costs that come as part of the buying process.

Often the largest outlay, after the deposit which goes to the bank, is stamp duty.

<h2 style="line-height: 1.38;">What is Stamp Duty?</h2>

Stamp duty is an extra tax to pay the government when you buy land, a property, and other certain assets.

It happens when the legal ownership is transferred. It can also be known as property transfer duty or transfer duty.

<iframe allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture" allowfullscreen="" frameborder="0" height="415" src="https://www.youtube.com/embed/C32BWkB5--c" title="YouTube video player" width="660"></iframe>

<h2>Who pays Stamp Duty?</h2>

In some circumstances, you may get an exemption. For some states, you won’t have to pay for stamp duty if you are a first home buyer or a pensioner for houses under a particular price. There are also stamp duty concessions, where you may be entitled to a discount.

<h2>How much does Stamp Duty cost?</h2>

Each state has different rules which affect how much you need to pay. These rules can affect the rate you pay, and the timeframe you will need to pay in. Before you buy land or a property, make sure you check the up-to-date information for your state’s stamp duty.

You can use a free stamp duty calculator online to see approximately how much you’ll need to pay. Find out if you’re eligible for an exemption by enquiring on a project via Urban!

Overall, the stamp duty you need to pay will depend on:

<ul>
	<li aria-level="1">How much your land/property is worth</li>
	<li aria-level="1">Where your land/property is located</li>
	<li aria-level="1">What type of land/property it is</li>
</ul>

Want to find out more? <a href="https://www.youtube.com/@UrbanAustralia?utm_source=YouTube&amp;utm_medium=Video&amp;utm_campaign=Subscribe&amp;utm_id=Subscribe">Subscribe to our YouTube channel</a> for more property videos.

Ellen Walker

Off-the-plan property explained: What is stamp duty?

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

<html><body>
Every second new home built today is attached – either a townhouse, villa, ‘plex’, flat or apartment.
Just 56% of the new dwellings approved during 2013 were detached houses.  It was 73% just five years ago.
One in four new dwellings approved are now in mid to highrise apartment towers.
Is this a fundamental shift?
<img alt="matusik_feb_13_one" height="627" width="470" src="/images/stories/2014/02/13/matusik_feb_13_one.png">
What the stats say
The graphic shows that there has been a rapid drop in new detached housing approvals in recent years.  In contrast, there has been a big lift in the number and proportion of mid-to-highrise apartments approved across the country.  There has been little real change in the level of new townhouses or low-rise unit construction.
Australia’s new housing market is now quite polarised between detached homes and apartment towers.
The cost to actually supply a new detached house (excluding land, taxes/charges etc.) is now similar to the cost to supply a new apartment.  It is considerably cheaper to supply a new townhouse or walk-up flat.
Of course, the size of a new house is much larger than a new apartment, with the average cost to build a new project home somewhere around the $1,000 per sqaure metre mark.  The cost to build new mid-to-high-rise stock sits at somewhere between $2,500 and $3,000 per square metre (as a ballpark figure).  It costs about $1,500 per square metre to build a new townhouse or basic walk-up flat.
Most new townhouses are three bed, two and a half bath, with two cars.  Many of the new walk-up flats are in two bed/two bath (with car parking) arrangements.  Many of the new mid-to-high-rise apartments are under 85 square metres and increasingly, one bedroom product.  New detached houses, by and large, remain three or four bedroom affairs.
Current demographic trends strongly suggest the need for more two and three-bedroom attached product.
<ul></ul>
My opinion
We seem to be stuck in the house versus apartment tower mindset.  This is especially the case in Queensland.
The recent changes to the Brisbane Town Plan further push this building form, i.e. traditional suburbia versus mid- to highrise density around select urban nodes.
What is missing – from an affordability and liveability viewpoint – is new housing product in-between.  We need more townhouses, ‘plexes’, terrace homes, granny flats, small lot homes and flexible dwellings.  These need to be supplied across much of the Australian fabric and especially in our middle-ring suburbs.
For mine, we also need one set of rules when it comes to new housing form.  This should apply across an entire state or territory.  Maybe it should even apply across the country, allowing of course for climatic differences.  It is all well and good that Ipswich City Council now permits granny flats.  But why not Brisbane?  Why does Adelaide – yes Adelaide - permit a much finer grain of new housing choice than Brisbane?
Our experience is that many residents want to ’age in place’.  Most don’t want to live in a highrise apartment complex.  They would like to downsize, stay local and have some nexus to the ground. But in the absence of affordable choice, they stay put, often as a couple in large detached homes.
This ‘in-between’ housing would also suit many first home buyers.
There is a real lack of new housing choice in the Australian market.  This is stopping first home buyers.  It is stopping empty-nesters from downsizing.  It is, by default, oversupplying the new high-rise apartment market and stalling detached housing supply.
Public policy is not allowing private enterprise (developers and builders) to supply what the market wants.
Is this a fundamental shift?
Yes.
But the role of the developers and builders is to respond to opportunities and work within planning frameworks (as dysfunctional as they might be) to deliver a product that sells.
The opportunity is that Australians, by and large, want more compact housing.  They are trading ’space’ for ‘place’.
The trouble is that this demand is largely being forced into one new product type – high density apartments.
Many buying this product anticipate strong capital gains and high rental returns.  On paper everything looks rosy. In reality, investment outcomes will be determined largely by supply.
For mine, we are now in danger of oversupplying the mid to highrise apartment market.
And sadly, within this mid to highrise space, apartment choice is increasingly limited.  It’s a race to the bottom – the smaller the better (read cheaper); or as the spin goes, “cheap and cheerful”.
Opportunity to supply a range of new housing types would reduce this propensity to overproduce, reducing the severity of the property cycle.
Michael Matusik is the founder of <a rel="nofollow" target="_blank" href="https://www.matusik.com.au/" style="font-size: 14px;">Matusik Property Insights</a>, which has helped over 550 new residential projects come to fruition.
Read <a rel="nofollow" target="_blank" href="https://www.matusikmissive.com.au/">Michael’s Blog</a> or follow him on <a rel="nofollow" target="_blank" href="https://www.facebook.com/ThinkMatusik?fref=ts">Facebook</a> and <a rel="nofollow" target="_blank" href="https://www.twitter.com/michaelmatusik">Twitter</a> or connect via <a rel="nofollow" href="https://www.linkedin.com/in/michaelmatusik">LinkedIn</a>.
 
</body></html>

michaelmatusik-49YzLvdmNv

Rush to produce high density apartments is a race to the bottom, and we're risking oversupply

<html><body>
Back in 2004, when Crown Group began showing interest in Parramatta, there were a number of naysayers about this growing city. However, the vision behind what is now the most recognisable and central hub for the western Sydney suburbs is being born out through the council, keen developers and buyers who are jumping onto what they see as an opportunity for growth.
The new $309 million V by Crown development will be the tallest in Sydney's <a target="_blank" href="/news">Parramatta</a>, at 29-storeys, just beating the B1 building that is 28-storeys high.
However, Property Observer has heard suggestions that it may soon face competition for this title, a comment that may be unsurprising for those who have seen the heavy presence of cranes in the skyline.
Today, the slabs will be set for Crown's residential tower – 30 metres wide, 50 metres long and one metre thick for those who haven’t yet grasped the size of the soon to be realised building.
{yoogallery src=[images/stories/2014/02/18/par2]}
Photographs taken on site by Property Observer
The letter ‘V’ from the name 'V by Crown' is prominent – it stands for vertical, but also for ‘vision’, which Parramatta Lord Mayor, John Chedid, put particular emphasis on. It appears to align with his vision of Parramatta as well.
<img width="470" height="481" alt="parramatta-feb-18-one" src="/images/stories/2014/02/18/parramatta-feb-18-one.jpg">
Parramatta Lord Mayor John Chedid, left, Crown Group CEO, Iwan Sunito, right. Photograph taken by Property Observer
“[The city of Parramatta is] delighted to have a company like Crown investing,” Chedid said on site yesterday, behind him the massive excavation site.
Chedid said the development sends a strong message of Crown’s commitment and belief in the future of Parramatta, the “economic hub of Western Sydney”.
The CEO of Crown Group, Iwan Sunito, appeared to agree. He said that back in 2004, when Crown Group started building and developing in Parramatta, he was regularly told that the plans were too ambitious for this area.
He was building one of the largest buildings at the time with more than 90 apartments, all of which has sold on completion in 2009.
This is his next important milestone, and he repeated his oft-quoted mantra: “Build it, and they will come.”
{yoogallery src=[images/stories/2014/01/23/par]}
And it seems they have already started pouring in for this development before it has been built. Of the 519 apartments at V, <a target="_blank" href="https://www.propertyobserver.com.au/developments/v-by-crown-development-reaches-%24150-million-in-sales/2014012367334">there have already been $150 million worth of sales</a>, a total of more than 270 apartments since the 2012 launch.
It was officially <a target="_blank" href="https://www.propertyobserver.com.au/developments/stamp-duty-handout-expiry-helps-sell-out-first-stage-of-v-development-in-parramatta/2012061855159">launched in Singapore in April 2012</a>, presumably attracting a significant amount of offshore interest.
Prices start from $428,000 and on offer are studios, one-, two- and three-bedroom apartments with a variety of floor plans, including some with studies.
The median unit price in Parramatta, according to RP Data, currently sits at $450,000.
Inside, it appears as though it will be everything a new development should be. Neutral palettes, modern amenities, space-maximising designs and careful consideration around the placement of rooms in the floor plan. This comes from the skills of Allen Jack + Cottier architects, along with the renowned architect Koichi Takada – arguably one of the most influential in Sydney.
{yoogallery src=[images/stories/2014/02/18/par1]}
Photographs taken on site by Property Observer
The current popularity that has led to the significant number of sales may be to do with the location, sitting on Macquarie Street and a very easy walk from Parramatta station. It may also be the promised facilities – a pool, gym, sauna, conference facilities, a music room, a theatrette and a library - amenities that were previously laughable for this area.
Discussing the area of Parramatta after the presentations with those attended, it appears that most are surprised with how quickly the city has emerged. It’s not, however, surprising that many buyers in the area are also first timers considering purchasing investments in the "second CBD" of Sydney. Sales manager for this project, Anthony Falas, previously provided us his thoughts on what will make these apartments a solid addition to an investors’ portfolio.
<img src="/images/stories/2014/01/23/v-by-crown-jan-23-breakout.jpg" alt="v-by-crown-jan-23-breakout" height="264" width="470">
It seems Crown Group is confident this will pave the way for the longevity of the area. With two three-storey ‘V’ shaped steel columns that peer over the entire site, it’s uncertain if they will ever be moved. In fact, Property Observer is told that roads needed to be closed to bring in the cement with which to fill them up.
V is set for completion in 2016 and it’s not clear yet where Crown Group will look for its next project.
When Property Observer asked, Sunito laughed. He said he’s just looking to get through this project first, but he hopes for a lot more to come for what he describes as the city of culture, connectivity, commerce and vision.
jduke@propertyobserver.com.au
For the latest development listings, brought to you by Property Observer and partners, see our <a rel="nofollow" href="https://showcase.propertyobserver.com.au/">Investor Showcase</a>.
 
</body></html>

jduke-EHk3XBmHkn

Slab to be set on highest residential tower in Parramatta, V by Crown, today

<html><body>
Real estate agents and financial planners often encourage purchasers to undertake ‘due diligence’ when purchasing a home or investment, but have you ever wondered what due diligence large-scale developers undertake when searching for potential new development sites?
With so many factors at play such as location, access to amenity and financial viability - then looking at how these factors affect the commercial success of each project - there are many due diligence tips that developers employ which can assist individual investors when assessing the potential of their property portfolio.
For us at ICD Property, undertaking a rigorous due diligence process is vital to ensure we only purchase prime development sites that lead to commercially successful apartment projects which we know will perform well once launched to the public.
We have a strict list of attributes that we look for and if the site in question doesn’t tick all the boxes, we move on.
To give you an example as a general rule our checklist includes things like:
<ul>
<li>
Site location within walking or short driving distance of at least one of the following public transport services: trams, trains and buses
</li>
<li>
Site location within walking or short driving distance of a grocery store and supermarket
</li>
<li>
Site location within short driving distance of restaurants and cafés
</li>
<li>
Site location within a short driving distance of existing medical facilities and commercial precincts
</li>
<li>
Site location within a short driving distance of at least one university
</li>
<li>
The ability to easily access major roads or freeways for the commercial commute.
</li>
</ul>
As a case in point, our new project in Hawthorn sits within 10 metres of tram and bus facilities, 15 metres from a major supermarket, 10 metres from a local shopping strip, one kilometre from a university and 4.5 kilometres from the CBD.
Basically our sites must provide accessibility to each of these elements and if they don’t we simply don’t see the commercial viability of purchasing the site as there is no sense in delivering residents to areas where there isn’t sufficient amenity to support the growth of a suburb.
While of course we are talking in commercial terms, these factors provide great insight into the psyche of the owner occupiers who purchase within our projects in terms of what they deem to be an acceptable level of ‘liveability’.
Now to apply this thinking to mum-and-dad investors and everyday buyers…
For many first-time investors or owner-occupiers, choosing the right property in the right location and the right mix of amenity can be a daunting experience and there’s so much research on the market it can almost feel overwhelming.
It may be reassuring for these home-hunters to know that developers go through a similar process when securing development sites for apartment projects and that these developers hand-pick their sites with the strictest protocols in mind.
Knowing that a particular apartment project has already been through the rigours of a developer’s due diligence can help put investors’ minds at ease knowing the apartment they purchase has been thoroughly vetted and assessed by the developer.
It’s food for thought as there is much to be learnt about the due diligence protocols of large-scale professional developers.
Michael Mai is managing director of <a href="https://www.icdproperty.com.au/" target="_blank">ICD Property</a>. ICD Property is currently marketing YOU AND I in Collingwood and in 2014 it will launch two other new projects.
</body></html>

mmai-AThrZTppWY

Due diligence the key to securing sites for successful apartment projects

<html><body>
Often the only way to figure out what’s really happening in real estate is to find a quiet room, shut out all the hype and media static, and spend a few hours looking at the cold hard numbers.
If you haven’t done that, you can be forgiven for thinking Melbourne had a rampant boom last year. The reality is that the Victorian capital had a solid but moderate year overall.
Three major research sources agree that the median house price rose 7% or 8%. They include the Australian Bureau of Statistics, which records a rise of 7.9% in 2013.
Keeping in mind that the three previous years were negative ones, the overall picture is one in which prices have done very little since 2009.
So there’s plenty of room for further price growth this year and indeed many precincts around the metropolitan area are emitting growth signals.
Most of them are middle-market or bottom-end areas, where a combination of affordability, solid infrastructure and good transport links make them attractive to all kinds of buyers.
An outstanding feature of metropolitan Melbourne is how widespread the growth regions are. Municipalities scattered around the city region have markets ranging from solid through steady to strong. But for the greatest concentration of future hotspots, head south-east from the CBD.
And, no, I don’t mean the millionaire suburbs of the inner south-east. I’m referring to more distant municipalities where affordable areas have rising markets. These include the municipalities of Dandenong, Casey, Kingston and Mornington Peninsula.
The City of Casey is the individual star, with seven suburbs with growing sales activity. Leading suburbs are <a href="/news">Cranbourne East</a>, <a href="/news">Cranbourne North</a>, Fairfield, <a href="/news">Hallam</a> and <a href="/news">Berwick</a>. Most are locations with the median house prices in the $300,000s.
The nearby City of Dandenong is another affordable area with a number of growth markets, including <a href="/news">Dandenong</a>, <a href="/news">Noble Park</a>, <a href="/news">Springvale</a>, <a href="/news">Keysborough</a> and <a href="/news">Dandenong North</a>.
Elsewhere in Melbourne, the outstanding regions are the municipalities of Brimbank in the west and Whittlesea in the north. In Brimbank I’ve identified nine suburbs with growth markets. This area has great growth prospects because of its range of affordable locations, good transport links and major spending on new infrastructure, including an $800 million transport hub.
The City of Whittlesea, a cluster of affordable growth suburbs in the north of the Melbourne metropolitan area, has seven growth suburbs. This is another area with strong infrastructure, good transport links and proximity to jobs nodes.
Affordability, infrastructure and jobs: it’s one of real estate’s power combinations.
The major risk hanging over the Melbourne market is the inner-city oversupply, but you already know that. If you don’t, you’re obviously living in China, which is where Melbourne developers will be trying to sell all those surplus apartments.
Terry Ryder is the founder of <a target="_blank" href="https://www.hotspotting.com.au/" rel="nofollow">hotspotting.com.au</a>.
You can contact Terry via <a href="https://mailto:%20ryder@hotspotting.com.au" target="_blank">email</a> or on <a href="https://twitter.com/hotspotting" target="_blank" rel="nofollow">Twitter</a>.
 
</body></html>

terryryder-YECXbqmri2

Good signals and plenty of room for growth in Melbourne suburbs

<html><body>
Anybody who follows the property market in <country-region>Australia</country-region> is familiar with Steve Keen, an economist who made a daring prediction that our property prices will fall as much as 40% sometime before 2023. How this prediction came about is subject to various interpretations, nevertheless, the “40% drop” forecast has been repeated so many times over the years, and by so many, that it has almost become a part of Australian folklore.
I have to admit that when I first came across Steve Keen’s prediction I treated it with a fair dose of scepticism since I could not find corroborating evidence for such a substantial fall in prices using indicators from my own analytical toolkit.
I had a particular issue with the somewhat overly simplistic assumption that 'whatever happened in the <country-region>US</country-region> has to happen here because we are no different'. I had an alternative perspective on this as, a decade or so earlier, I had undertaken some analysis of the 1980s housing crisis in the <country-region>US</country-region> and clearly, the events played out quite differently in <country-region>Australia</country-region>.
However, there was one bit of theory that underpinned Keen’s conclusions which attracted my further interest. In particular, at the core of Keen’s argument is a concept that “aggregate demand equals GDP plus the change in debt” (emphasis mine).
Since debt is equivalent to cash in your pocket and 'money makes the world go round', it therefore seems a logical proposition to look into changes in debt levels as a way of gauging what is happening in a wider economy.
Keen devised an indicator called the <a target="_blank" href="https://www.debtdeflation.com/blogs/2011/08/28/updated-credit-accelerators/">Credit Accelerator</a> to forecast the effect of changes in debt levels on GDP. It is conceptually similar to Credit Impulse proposed by Biggs, Myer, Pick in <a target="_blank" href="https://www.banccentraldecatalunya.ch/wordpress/wp-content/uploads/2013/Biblioteca_ERC/2013Oktober/11102013/BankOfNetherlands-Working%20paper%20218_tcm46-220409.pdf">their analytical paper</a> published in July 2009.
Briefly on Credit Impulse, as it is important for the interpretation of the graph presented below: the original theory was the result of an attempt to find a possible explanation for credit-less recoveries where GDP starts to grow with no growth in stock of credit. The authors found the evidence that a mere slowdown in the speed of debt reduction (i.e. in deleveraging) had a positive effect on the overall economy.
In simple terms, when the Credit Impulse indicator starts to point upwards while in negative territory, it is a positive sign that things are improving. The opposite should also hold true; that is, when it starts to point down while in positive territory - it is a negative sign meaning things are deteriorating.
So by substituting total debt with just housing debt, one can potentially gain insight specifically into the property market.
However, it is debatable whether Credit Impulse/ Credit Accelerator are still meaningful in this context. And there are also some issues with refinancing not being able to be isolated from the total value of housing debt which potentially clouds the picture. Nevertheless, a comparison of Credit Impulse (constructed with housing debt data) to the 12-month rate of change in the established house price index indicates quite a good correlation between the two data series, as illustrated on the following chart.
<img src="/images/stories/2014/02/17/arek_feb_1_7_one.png" width="470" height="320" alt="arek_feb_1_7_one">
Source: Based on ABS and RBA data
I am using an adaptation of the Biggs, Myer, Pick version of the algorithm, hence there may be discrepancies between Keen's and my version of the graph.
It is worth noting that correlation between the two data series is particularly strong over the last five years (for those statistically inclined, correlation coefficient is 0.88 but drops to 0.64 for the entire series). That would imply there is merit in using the Credit Impulse concept for monitoring the state of the property market in <country-region>Australia</country-region>.
The potential benefit of this indicator is twofold: it offers a timely insight into the dynamics of the property market – better than quarterly established house price data from the ABS. And secondly, perhaps more importantly, it can provide an early indication of impending changes in the direction of property prices.
As the above graph demonstrates, the theory behind Steve Keen’s original prediction appears sound - although it is not entirely clear to me whether Keen had actually been using his Credit Accelerator indicator when he made his prediction or not (Biggs, Myer, Pick paper was published much later). However, let’s examine how this indicator should have been interpreted if it was in existence.
Article continues on next page. Please click below.
 
<hr class="system-pagebreak">
To be frank, it would have been a frightening experience to stare at this graph in 2007 and 2008, hearing about all the financial collapses happening throughout the world and not knowing the depth it could all fall to.
Based on these factors alone, a prediction of significant declines in house prices would have been well justified back then. However, since the magnitude of the likely decline cannot be derived directly from the Credit Impulse indicator, I assume there must have been other factors that allowed Keen to make the estimate of 40% drop in prices, because otherwise it would have been just a presumption.
By the same token, when the Credit Impulse started to point upwards in March 2009, and kept rising in the following quarters, it gave an indication that things were likely to improve. However, this message was not conveyed to the wider audience. So, again, one can only assume that there must have been other compelling factors that led Keen to persist with his earlier conclusion.
The whole situation repeated again in 2010 (i.e. in June Credit Impulse indicated a possible reversal in the growth of property prices) and in 2012 (when the Credit Impulse started to point upwards again, indicating the likely end to price decreases).
By then Keen had been regularly publishing commentary on his Credit Accelerator indicator, so the experience from the earlier 2008-2009 episode should have helped with a more accurate interpretation of what was happening. However, throughout that time, Keen had insisted that there were only two likely options for property prices: a US-like scenario where prices fall rapidly, or <a target="_blank" href="https://www.propertyobserver.com.au/residential/house-prices-will-fall-in-a-slow-bleed-fashion-steve-keen/2013060662034">Japan-like scenario of a “slow melt”</a> over the <a target="_blank" href="https://www.propertyobserver.com.au/residential/property-prices-to-fall-20-by-2013-year-s-end-steve-keen/2011101952000">next decade or so</a>.
Again, this call was made most likely because of other factors which, to my best knowledge, remain unspecified (that is, if we leave aside the two simplistic assumptions Steve Keen made that '<a target="_blank" href="https://www.debtdeflation.com/blogs/2012/01/28/economics-in-the-age-of-deleveraging/">Australian private debt is high and therefore it will deleverage</a>' and that 'Australia is like the US so the same has to happen here as well').
It was only much later, when a third scenario started to play out and property prices actually recorded some gains, that Steve conceded prices <a target="_blank" href="https://www.debtdeflation.com/blogs/2013/11/13/i-will-be-wrong-on-house-prices/">“may go up for a while”</a>. However, the media did not pick up on this comment with the same zeal as on the previous doom scenario. How unfortunate.
All in all, in 2008 Keen had an important message to tell and that message was broadcast to a wide audience. Media played a very important role in publicising his warning. That is how I and many others became aware of his views.
However, not many took the effort to understand what was really behind the “40% price drop” headline. The majority bought into this scenario without any further thought.
Many still hold to this view despite prices reaching new heights and despite the fact that the indicator that is at the core of the original prediction is showing that property prices will grow further. However, the positive message is not being reported by the media.
To be fair, there is a small possibility that the “40% price drop” prediction may come true in the next decade (the timeframe nominated by Steve Keen). We can only wait and see. However, if it happens, without additional evidence from Steve on what kept him convinced that the original scenario is still to play out, it will be difficult to accept that it was all <a target="_blank" href="https://www.propertyobserver.com.au/residential/australian-property-prices-in-2014-and-beyond-a-peek-into-the-future/2014013167457">predictable as far back as 2008</a>.
One thing is almost certain though. Based on the past performance, the Credit Impulse should give a warning when the current price trend is about to reverse. For now, let’s just enjoy the ride to the next top, however long, or short, it will be.
Arek Drozda is an independent analyst who has worked in the public and private sectors for over 20 years in business development, data analysis and in building geographic information systems.
UPDATE: In repsonse to this article Steve Keen wrote a reply, which you are able to view here: <a href="https://www.propertyobserver.com.au/economy/clarifying-my-40-drop-call-and-what-s-still-driving-housing-prices-up/2014021867863" target="_blank">Clarifying my 40% price drop call and the factors still driving housing prices up: Steve Keen</a>
 
 
</body></html>

adrozda-Nq9GwoWWBW

Revisiting Steve Keen’s 40% property price fall prediction

<html><body>
The recent predictions by US economist Harry Dent, claiming that <a href="https://www.propertyobserver.com.au/news/property-crash-is-like-popping-popcorn-especially-in-melbourne-harry-dent/2014020567560" target="_blank">Australia’s ‘property bubble’ is going to burst</a> and that prices will be slashed by half, is somewhat an extreme view. Though it pays to be aware of these economists and the alarming claims, which pop up from time to time, it pays more to check the data they are providing as proof.
Dent is saying that US real estate prices will fall by 60 to 65%, Australia by 50% and that stock markets and China will crash – heralding a new ‘Great Depression’. But his claims don’t appear to be based on any data – there are little to no facts supporting that we are in for a depression.
Dent offers up no hard explanation for his predictions, apart from the income to house price ratio, and this is very high in a lot of cities where people want to live such as Sydney, Melbourne, San Francisco, Los Angeles, New York, Auckland and London. The reality in these places, is that there are rising populations and limited supply of housing in their most popular areas.
The ratios are of course much lower in less high-demand areas where there is slower growth, or where populations and prices drop when an industry such as mining or manufacturing goes into decline. Big cities however, are much more insulated as they have many economic strings to their bows.
If anything, Australian markets are getting stronger.
While residential property in many of our capital cities could now be deemed borderline ‘unaffordable’, I would contend that because a market has an asset that is somewhat unaffordable does not mean that it is overvalued.
Value is after all a function of the preparedness of a buyer to pay a price for the asset based on its unique attributes and its scarcity. So, while there are buyers at the current price, it is not overvalued.
Australian capital cities are unique in that our populations are generally concentrated in them. And, due to the cost of providing infrastructure to new land areas, our cities do not easily provide supply. Populations in Australia are growing and hence there is always some level of demand for housing assets.
Unaffordability is generally a measure based on the capacity of a median family to be a first home owner. There are many buyer types in a market, including investors and existing home owners.
An unaffordable market simply causes the type of buyers in the market who are active to change.
An unaffordable market for the first home owner simply causes a higher level of families to rent.
A population in an unaffordable market finds solutions to making a market affordable. For example, they may increase people density per dwelling, or alter the size of dwellings to reduce costs. They don't tend to sell into the market because it is unaffordable unless they have to as a consequence of unemployment or similar income failure.
But this point is the important issue: whilst there is no significant oversupply due to selling pressure or development of new properties, the increasing population will hold demand at current values and consequently our property markets will not be overvalued – and therefore we are not experiencing a bubble.
To be honest, I am not hugely surprised that Dent predicted the GFC (if this is actually true) as his predictions do seem to follow a similar theme. As with many economist naysayers, one would have to be right about something sooner or later – it’s a bit like predicting a dice will throw a six, if you keep throwing of course it will.
What I would suggest for buyers is to take a long term approach based on the data. Work on the basis that economic growth and prices trend higher and higher over time, and although it may be interrupted by recessions and other negatives, the general theme is up.
It’s important to be on top of these sorts of startling predictions – but take them with a certain level of cynicism.
John Edwards is consulting analyst for <a href="https://www.Onthehouse.com.au" target="_blank">Onthehouse.com.au</a> and founder of <a href="https://www.residex.com.au/" target="_blank">Residex</a>.
 
 
</body></html>

jedwards-8kHM8GNY6d

Bursting Harry Dent’s own bubble

<html><body>
To a limited extent inequality and the ‘rich/poor’ gap is tolerated within society. Economists have historically seen it as a necessary platform to stimulate ‘economic progress’, or even activate a sense of competitiveness within individuals in order to elevate themselves up the social ladder.  
Certainly in the housing market this is evident.  Who hasn’t aspired to their ‘dream’ home – or visualized some improvement similar to that of their neighbours?  
It’s what the success of programs such as Grand Designs thrive upon - the emotional aspect of ‘wanting’ bigger and better - and a proportion of <a target="_blank" href="https://www.news.com.au/finance/real-estate/ing-first-homes-buyers-increasingly-spending-a-million-dollars/story-fncq3era-1226820981579">home owners</a> will stretch their budget in order to achieve their desired property of choice, taking on a larger mortgage to do so.  
However, whilst a degree of inequality may be tolerated as an inevitable consequence of the benefits offered in a capitalist society, a widening gap can become disabling to progress, or even dangerous if items of basic need are perceived to be increasingly out of reach.  
In their 2012 ‘Global Risks’ annual report, the <a target="_blank" href="https://www.weforum.org/">Word Economic Forum</a> put it like this;  
“When ambitious and industrious young people start to feel that, no matter how hard they work, their prospects are constrained, then feelings of powerlessness, disconnectedness and disengagement can take root. The social unrest that occurred in 2011, from the United States to the Middle East, demonstrated how governments everywhere need to address the causes of discontent before it becomes a violent, destabilizing force.”  
The comments build on research undertaken by Andrew Berg and Jonathon Ostry, two senior staff in the <a target="_blank" href="https://www.imf.org/external/pubs/ft/fandd/2011/09/berg.htm">IMF’s Research Department</a>, who found that once a country had entered a period of economic growth, the more equal the distribution of wealth over the ensuing period and the longer it lasted. They conclude that: “sustainable economic reform is possible only when its benefits are widely shared.”
 
Inequality in Housing  
The consequences of inequality in the housing market are painful and slow. The trend is increasingly evidenced over a lengthy period of years – not in the volatility of month to month first home buyer statistics - always marginalizing those at the bottom of the income stream, whilst advantaging those at the top.  
Effects include;
<ul>
<li>
<a target="_blank" href="https://www.ahuri.edu.au/housing_information/review/evrev035">Social polarization</a>,
</li>
<li>
A decrease in the number of <a target="_blank" href="https://www.ahuri.edu.au/housing_information/review/evrev014">low income buyers</a> obtaining ownership,
</li>
<li>
A drop in the number of affordable <a target="_blank" href="https://www.ahuri.edu.au/housing_information/review/evrev004">rental dwellings</a> with demand outstripping supply,
</li>
<li>
Greater requirements for <a target="_blank" href="https://www.ahuri.edu.au/housing_information/review/evrev008">public housing</a>,
</li>
<li>
A rise in <a target="_blank" href="https://www.ahuri.edu.au/publications/projects/p80516">homeless</a> percentages, and those who drift in and out of secure rental accommodation.
</li>
<li>
A rising percentage of <a target="_blank" href="https://web.archive.org/web/20130513194216/http:/nhsc.org.au/publications/">long term tenants</a>, and falling percentage of property owners, - across all demographics, – but particularly families with children.
</li>
<li>
Fewer Australians – across all demographics - owning their <a target="_blank" href="https://www.ahuri.edu.au/themes/home_ownership">homes outright</a>.
</li>
<li>
Evidence of <a target="_blank" href="https://web.archive.org/web/20130513194216/http:/nhsc.org.au/publications/">severely crowded</a> accommodation…. And so forth.
</li>
</ul>
  The list, which names only a few of the prevailing concerns, creates a growing body of evidence that we have more than an affordability issue in Australia which focuses overwhelmingly on first home buyer figures.  
We have a growing structural problem, which, if allowed to continue, with have a societal impact, chipping away at the future growth and stability of the property market, affecting the majority – not just a ‘few.’  
Why?  
The reason this has occurred is down to our property cycle – or perhaps better-termed a ‘land cycle’ – which has been further accentuated by poor housing policy, restrictive planning conditions and generous tax incentives, which are ultimately destructive.  
Rising prices and the expectation of such are initially seen as a ‘good’ thing, because they drive the economy, increasing consumption (the ‘wealth’ effect), stimulate economic growth, infrastructure investment, construction activity and demand for ‘durables’.  
This in turn flows through to wages – which advantage the workers at the top of the income stream, rather than the labourers at the bottom. Andrew Leigh’s <a target="_blank" href="https://www.blackincbooks.com/books/battlers-and-billionaires">Battlers and Billionaires: The Story of Inequality in Australia </a>(2013) points out that since the mid-1970s, earnings after inflation for the bottom tenth of the population has grown 15%, in comparison to 59% for the top tenth.  
The gains are subsequently capitalised into rising land values, as investors, buoyed on by inflationary expectations, easier lending conditions and ‘fear of missing out’, lead a bull market of speculative activity (such as we’re seeing in Sydney) - until reality eventually steps in and the trend inevitably turns.  
In other areas of the economy that suffer from inflation, some form of substitution can typically occur. However land - and the infrastructure that gives it its value - is fixed in supply and an absolute necessity to all business and personal needs. Therefore, as land values rise, there is an inevitable strain on <a target="_blank" href="https://press.anu.edu.au/wp-content/uploads/2011/06/14-1-A-4.pdf">productivity</a>, affecting job growth, private debt, small business, and unemployment (such as we’re seeing in Australia presently).  
Whilst monetary policy and the interest rate ‘lever’ are employed to moderate the damaging effects of a property cycle, at every step of the process, real estate has been used as collateral for further economic investment; a revenue generating machine for government; and ‘wealth’ fund for retirement. Therefore, whilst the aim is to prevent a ‘hard’ landing, the motivation is always bent on protecting existing values, rather than letting them fall.  
Hence why demand side subsidies are favoured as a ‘Band-Aid’ to affordability, rather than cure.  
The result  
Without direct political intervention to rectify the damage, the greater and more destabilising the divide becomes; not only placing pressure on the welfare system, but evidenced ‘vocally’ as rising numbers enter the housing market later, pay far more over the lifetime of their loan, and risk reaching retirement still servicing household debt – as is the case in Australia.  
This was noted back in 2012 in a CPA study entitled <a target="_blank" href="https://www.cpaaustralia.com.au/cps/rde/xbcr/cpa-site/household-savings-retirement-report.pdf">‘Household Savings and Retirement – where has all my super gone?’</a> And most recently by executive chairman of Yellow Brick Road, Mark Bouris, who ‘concerned’ about lump sum superannuation payments being used to pay off mortgages, made a submission to Joe Hockey’s parliamentary financial inquiry. He suggested we can ‘solve’ the above impacts, with additional tax breaks to allow people to pay down their housing debt faster.  
It doesn’t take much of an economist to understand that subsidies – no matter how attractive they may seem - are ultimately capitalised into prices, thereby raising the entry costs for first home ownership further and increasing the pain for the next generation of aspiring buyers.  
The self-perpetuating cycle  
To some extent, it's a self perpetuating cycle – after 30 years of mortgage repayments dedicated to paying off their principle place of residence, vendors obviously don't want to see the price of their biggest asset drop.  
Investors are similarly motivated; an <a target="_blank" href="https://www.ahuri.edu.au/">AHURI</a> study released in December 2013, identified the typical investor as one who expects their property to ‘double every 10 years’ as a strategy to finance retirement.  
Incidentally, the same study also noted that three-quarters of the investors surveyed, do not see negative gearing as a reason to purchase, but merely as 'an added bonus'.  This contrasts with the myth of an ‘investor lead exodus’ should the policy be scrapped.  
However a system that tries to both feed speculation, whist creating unaffordability through supply constraints, is ultimately set to fail, as low-income households are continually forced to the outskirts, whilst the higher income individuals get to purchase the front row seats.
Article continues on next page. Please click below.
 
<hr class="system-pagebreak">
Social polarisation  
This results in social polarisation, which is clearly visible on the Melbourne map below, taken from the <a target="_blank" href="https://www.reiv.com.au/">REIV</a>, which illustrates the median house price by suburb, relative to the metro median.  
The colours coded with the darkest blue indicate house prices more than double the metro median, and orange, house prices that are more than 25% below the metro median (The white spaces are areas for which there is insufficient data).  
<img alt="cashmore_feb_14_one" height="477" width="470" src="/images/stories/2014/02/14/cashmore_feb_14_one.jpg">
Source: REIV
This aligns very closely to a map constructed using data from the <a target="_blank" href="https://www.abs.gov.au/websitedbs/censushome.nsf/home/seifa?opendocument&amp;navpos=260">ABS</a>, which ranks geographic areas in terms of their relative socio-economic advantage and disadvantage, highlighting diversities such as incomes, education levels, occupations, rent and mortgage payments, family structure and unemployment.  
Once again, the beetroot red and bright orange ‘fringe’ suburbs sit well away from the affluent dark blue vicinities, which contain the top schools, medical facilities, shopping strips, high paying jobs, train and tram networks, childcare centres, social amenities, and so forth - all of which our tax payer dollars collectively fund. Yet under the current structure, only the local home owners get to advantage.  
<img style="display: block; margin-left: auto; margin-right: auto;" alt="cashmore_feb_14_two" height="223" width="320" src="/images/stories/2014/02/14/cashmore_feb_14_two.png">
Source: ABS
This would include not just the various social benefits offered, but the additional on-flow of capital gains each property attracts from a squeeze of consistent market demand.  
The top performing government schools in Australia do not reserve places for those showing merit (with a few exceptions). Instead, the families both willing and able to pay the 20-50% premium are able to afford housing in a desirable school’s catchment zone.
In case you need further convincing, you can chart how the trend has evolved using the image below, which is taken from a previous <a target="_blank" href="https://www.ahuri.edu.au/housing_information/review/evrev014">AHURI</a> investigation, showing how the percentage of affordable dwellings available for low to moderate-income purchasers, has changed in Melbourne, between the years of 1981 and 2006.  
The darker areas are the ‘most’ affordable, whilst the white patches are the least.    
 <img alt="cashmore_feb_14_three" height="261" width="470" src="/images/stories/2014/02/14/cashmore_feb_14_three.jpg">
What of the ‘price’ ripple effect?  
Even heading 45 kilometres or so away from the CBD, low-income purchasers can only acquire affordable accommodation – in the range of $200,000 to $400,000 - if the lot size is much smaller than 600 square metres, which is still deemed ‘standard’ in many middle suburban regions of Melbourne.  
Further more, any hope of a game of backyard cricket is unlikely, as the new developments are littered with homes that have a footprint which extends to the boarders of each block.  
The graph below highlights why this is.  It was put together by a colleague, Steven Armstrong, using <a target="_blank" href="https://www.dtpli.vic.gov.au/property-and-land-titles/valuation/government-valuations/valuer-general-victoria">valuer general</a> statistics, and it charts the extraordinary rise in land values per square metre in Hume City - an outer metropolitan growth zone in north-western Melbourne – between the years 1983 to 2012.  
<img alt="cashmore_feb_14_four" height="241" width="470" src="/images/stories/2014/02/14/cashmore_feb_14_four.png">
Source: Steven Armstrong, Valuer-General Victoria
The remarkable escalation in prices had nothing to do with homeowners wanting the castle, when a modest suburban home would do. Rather the issues I outlined <a target="_blank" href="/news">last week</a> in regard to planning restrictions (false scarcity), tax and infrastructure overlays, land speculation (the underlying cause of ‘all’ bubbles), that are exasperated further by ineffective supply side policy.  
It’s important to make this point, because whilst most people assume the ‘price/ripple’ effect works outwards – under the current system, the causation works both ways.  
It’s the marginal price of land at the fringes of our capital cities that sets the ‘base’ value for the better-located plots further in.  
In other words - it’s not supply that ‘solves’ affordability for low income purchasers, but the cost at which that supply can be delivered to the home buyer (not speculator) market.  
Is property overvalued? A bubble? A concern?  
When I was recently <a target="_blank" href="https://www.propertyobserver.com.au/residential/is-australian-property-overvalued-the-experts-have-their-say/2014020667606">asked</a> comment on whether Australian real estate was overvalued or not, I sensed the intention was to take the traditional view and assess whether job growth, population expansion, demand for credit, housing turnover, wage growth, interest rates, mid-term supply were supportive of a future sustained increase.  
However, whilst the above data will give a mid-term indication over whether current process are ‘serviceable’ at existing rates, or if market turnover can maintain pace, it gives little indication as to the long-term effects I’ve highlighted above, which in my mind, present a far greater destabilizing force, as we bear witness to a slow generational shift, eating at the edges of home ownership in the months and years ahead.  
I’ll leave the reader to come to their own predictions on market movements as we traverse through 2014. Albeit, in light of the government’s response to previous housing ‘affordability’ enquiries, I think the above concerns will merely worsen rather than improve – and at some point, we’ll all feel the impact.
Catherine Cashmore is a market analyst with extensive experience in all aspects relating to property acquisition.
 
 
</body></html>

catherinecashmore-6LXia3pPQj

The widening inequality and economic growth gap: What does this mean for housing?

<html><body>
People often fail to see value if they can’t relate to the setting.
In 2007 a Grammy Award-winning musician - violinist and conductor Joshua Bell - stood in a metro subway in Washington DC and played for 45 minutes on a $3.5 million Stradivarius. Over 1,000 people walked past. Only seven stopped, briefly, to listen. A three-year-old boy was the only person who paid any real attention to the world-class violinist, who two days earlier had sold out a concert hall in Boston at $100 a seat.
{qtube vid:=hnOPu0_YWhw}
This experiment, conducted by a newspaper columnist, created quite a stir at the time, for all sorts of reasons. One was that people generally assumed the musician was no good if he was busking in a railway tunnel. They failed to recognise the quality because of the setting. They missed a unique opportunity for a free concert from one of the world’s best musicians.
The story has real estate parallels. Most investors fail to recognise the quality in property that’s in a setting that doesn’t meet their expectations. Real estate snobs often miss the best investments because they think quality means expensive.
Why would anyone want to live there? Is often heard from people who personally would choose somewhere swankier. The answer, not that they ever stop to hear it, is: lots and lots of people, for all kinds of valid reasons.
Sydney is strong right now and the pattern of sales activity suggests further price growth in 2014. The list of locations recording the greatest increases in sales is dominated by more affordable areas. The municipalities of <a href="/news">Blacktown</a>, <a href="/news">Parramatta</a>, <a href="/news">Canterbury</a> and <a href="/news">Bankstown</a> lead the Sydney pack, although the City of Sydney also has plenty of activity in its apartment markets.
Blacktown City is the individual star. It has a dozen suburbs with strongly rising market activity. This is the population growth leader in New South Wales and one of the most popular areas for first home buyers. It offers affordable homes, good infrastructure, strong transport links and proximity to major jobs nodes.
For these and other reasons, more people are buying there than in <a href="/news">Vaucluse</a> or <a href="/news">Mosman</a>. Many people aspire to live in those silvertail suburbs but that aspiration does not translate into market demand because relatively few can afford them.
Price growth is driven by the weight of mass demand and, overwhelmingly, the great bulk of buyer demand goes to the places with attainable prices. Affordability rules in real estate. Affordability plus infrastructure (such as commuter train links) is one of real estate’s power combinations.
Quality in property investment is not dictated by the luxury features of the property or the prestige of its setting. It’s defined by superior capital growth rates and stronger rental returns.
In Sydney, right now, quality is more likely to mean Blacktown than <a href="/news">Balmain</a>.
There are similar stories to tell throughout capital city Australia. In Perth, the average growth in 2013 was around 8-9% but many precincts did much better than that. They were not the millionaire enclaves west of the CBD beside the river or the beach. They were the affordable areas some distance from the City, including the municipalities of Swan, <a href="/news">Gosnells</a> and <a href="/news">Armadale</a>.
Closer to the CBD, but still relatively affordable, the municipality of <a href="/news">Belmont</a> also delivered strong price growth.
To be a successful investor, avoid the syndrome that was evident in the Washington experiment involving one of the world’s best musicians.
Terry Ryder is the founder of <a href="https://www.hotspotting.com.au/" target="_blank" rel="nofollow">hotspotting.com.au</a>.
You can contact Terry via <a href="https://mailto:%20ryder@hotspotting.com.au" target="_blank">email</a> or on <a href="https://twitter.com/hotspotting" target="_blank" rel="nofollow">Twitter</a>.
 
 
</body></html>

A quality property investment is not dictated by prestige or price, but by growth and returns

<html><body>
The forecast is grim for housing affordability in Sydney, according to a recent government <a target="_blank" href="https://www.parliament.nsw.gov.au/Prod/parlment/publications.nsf/0/B3D723202932C63ACA257C61001D07AF/%24File/Trends%20in%20home%20ownership%20-%20FINAL.pdf">briefing paper</a>. In the last decade median rent for all properties in the inner ring of Sydney more than doubled from A$195 to A$560.
We can expect little policy movement on private housing subsidies by the federal or state governments. <a target="_blank" href="https://theconversation.com/explainer-why-negative-gearing-is-bad-policy-21882">Negative gearing</a> has increased the wealth of middle and high income Australians. Developers endlessly lobby governments for taxation concessions. No major political party would dare propose reform.
Whether the Sydney Metropolitan Strategy has been successful in providing affordable housing is debatable. The strategy does more to <a target="_blank" href="https://db.tt/j7ZibMAR">underwrite the problem</a> of housing affordability than address it.
<a target="_blank" href="https://strategies.planning.nsw.gov.au/MetropolitanStrategyforSydney.aspx">The strategy</a>, part of the “Global Sydney” vision from the NSW state government, is almost 10 years old. Updated <a target="_blank" href="https://www.planning.nsw.gov.au/Portals/0/HousingDelivery/Population_projections_Brochure_NSWGrowing.pdf">government forecasts</a> suggest Sydney’s population will grow to 5.8 million by 2031 - approximately 200,000 more people than predicted in 2010.
Young (under 15) and elderly (over 65) people will account for the biggest growth rates. People aged 18-25 are already feeling the housing affordability squeeze. As are elderly private renters.
The Global Sydney vision
The strategy set out plans for the provision of 770,000 additional homes, 760,000 new jobs, and new transport networks to meet the demands of a growing city.
In 2005 the NSW Premier stated in the opening pages of the strategy text:
"Sydney is Australia’s only truly global city and one of the world’s great metropolises."
At the national level, the globalisation of Sydney is inevitable and useful in geo-political and economic terms. But at the local level, the Global Sydney vision leads to costs and benefits for different social groups. The government’s eagerness to position Sydney as a global city has important local repercussions for urban planning and affordable housing provision.
Crucially, it represents a fundamental reorganisation of the way we think about the city. Rather than thinking about Sydney as an urban space within which the rights of the city’s inhabitants might be protected, the global city of Sydney is pitched as facing the harsh economic realities imposed by the global world.
Global cities and urban zones
Central to the vision is an assumption that global cities move foward to betterment. Ideas such as social progress, economic growth, and increased property prices are all contingent on moving the city from its blemished past to an improved future.
In Sydney, this has resulted in a rethink of the purpose of the greater Sydney region. Some sections of the city were promoted as sites that could be used to capitalise on specific locational advantages, such as “growth centres” and “business parks”. Visually, the city was represented as a network of zones made up of a “global economic corridor” connecting the “powerhouse of Australia’s economy” to the “airport”, “major shipping networks”, and the “shopping districts and malls” within the “regional hubs”.
<a style="font-size: 0.8em;" href="https://c479107.ssl.cf2.rackcdn.com/files/40730/area14mp/xcc63v9h-1391567906.jpg"><img width="470" src="https://c479107.ssl.cf2.rackcdn.com/files/40730/width668/xcc63v9h-1391567906.jpg"></a>
<a style="font-size: 0.8em;" href="https://c479107.ssl.cf2.rackcdn.com/files/40730/area14mp/xcc63v9h-1391567906.jpg"></a>The Sydney Metropolitan Strategy highlights key regions for economic activity. NSW Government
The strategy commodifies the urban space of the city. In other words, the various zones of the city are thought of as a tool through which the government might better integrate Sydney into the global economy. But to enable this Global Sydney vision, changes had to be made at the local level.
Urban renewal, housing affordability and privatising public property
Historically, public housing has been a key housing affordability policy mechanism. Evaluated through the Global Sydney vision and metropolitan strategy public housing estates are portrayed as outdated places that are preventing the future economic progress of the city.
NSW Department of Planning and Infrastructure says:
"What do we mean by renewal? Renewal is not simply about increasing housing densities. Urban renewal is about transforming under-used or dilapidated areas…"
Sydney has many underused or dilapidated areas, but how the Department measures these two criteria is important.
For example, in terms of land-use planning, many consider the low housing density profiles of some Sydney suburbs close to the city and transport centres to be an underuse of urban space. “80% of the city will be untouched” by the strategy <a target="_blank" href="https://www.be.unsw.edu.au/sites/default/files/upload/research/centres/cf/CFpresentations/mayorsforumhandouts.pdf">argued</a> Professor Bill Randolph in 2006.
There has been local <a target="_blank" href="https://www.smh.com.au/nsw/public-housing-no-bar-to-property-gains-20131025-2w6zbhttps://www.smh.com.au/nsw/public-housing-no-bar-to-property-gains-20131025-2w6zb.html">resistance</a> to housing affordability programs that threaten to impinge on the housing landscapes of wealthier Sydney suburbs.
In the strategy, measuring an underused or dilapidated area was conditional on the commodification of urban space. A place is defined as underused or dilapidated so that it can be redeveloped to extract a financial return from this undervalued urban commodity.
In the case of public housing estates, they are not defined as dilapidated to provide much needed maintenance, or as underused to increase the public (i.e. affordable) housing supply. Estate redevelopments do not revitalise the rights of poor urban populations.
Instead, they label these urban spaces as “economically unproductive” and the tenants as socially dysfunctional. Both the housing stock and tenants are thought of as dilapidated.
Announcing a public housing estate redevelopment by <a target="_blank" href="https://theconversation.com/funding-the-future-after-the-demise-of-ppps-18869">public-private partnership</a> in 2005 the <a target="_blank" href="/news">state government</a> said, “much of the public housing stock is either at the end of its economic life or requires significant refurbishment”. They suggested that public housing estates were “burdened with more than their share of problems, made worse by low concentrations of private housing”.
During redevelopments, changing the housing-tenure profile or dispersing tenants across the city in pursuit of global city credentials, irrespective of the disruptions to the often long-term residents of these estates, is justified.
Australia needs a new housing vision
The strategy’s criterion for defining urban spaces as underused or dilapidated means public housing and tenants are viewed as part of the city’s dilapidated past. It also reinforces private and non-government housing as part of the city’s global future.
Infilling affordable housing projects into the parts of the city where it is most needed has generated strong local opposition within this context. This threatens the rights of low-income citizens to long-term affordable housing in the city.
Reducing public housing supply, increasing non-government housing supply or providing <a target="_blank" href="https://theconversation.com/why-falling-house-prices-arent-the-calamity-the-media-would-have-you-believe-4547">taxation concessions</a> for mum and dad investors and developers has not addressed the housing affordability problem in Sydney.
Australia needs a new housing vision from which progressive affordable housing policies can be built. A vision that is not conditional on private housing subsidies and the privatisation of public property.
Dallas Rogers is a research fellow with the Urban Research Centre within the University of Western Sydney’s School of Social Sciences and Psychology.
This article was originally published on <a href="https://theconversation.com">The Conversation</a>. Read the <a href="https://theconversation.com/sydneys-global-vision-bad-news-for-local-housing-affordability-22761">original article</a>.
<img width="1" src="https://counter.theconversation.edu.au/content/22761/count.gif" height="1" alt="The Conversation">
</body></html>

drogers-JvoVgMGDGm

Australia needs a new housing vision from which progressive affordable housing policies can be built

<html><body>
It's gone. Car manufacture and assembly is dead in Australia.  It is now time to break that emotional bond with locally-produced cars and it's time to rapidly retrain and redeploy this vast workforce.

The recent announcements from Holden, Ford and now Toyota regarding the winding down of their manufacturing operations in 2016/2017 has naturally caused a lot of angst among the aforementioned company employees as well as the workers of the companies in the respective supply chains.   That being said, the skills these people possess are too valuable to simply wither away into the ether.

Urban.com.au has previously reported on the pre-fabricated building sector in action (<a href="/news/one9-hall-street-moonee-ponds-34-apartments-5-days" target="_blank">One9, Hall Street Moonee Ponds, 34 apartments, 5 days</a>) as well as examples from overseas (<a href="/news/avi-friedmans-outside-the-box-thinking-on-affordable-housing" target="_blank">Avi Friedman's outside the box thinking on affordable housing</a>) and we now feel it to be even more necessary to champion an expanding pre-fabricated building sector in Australia.

Jemma Green and Peter Newman from Curtin University, writing in the <a href="https://theconversation.com/building-a-housing-industry-from-the-relics-of-a-car-industry-23195" target="_blank">Conversation</a>, best explain it:

<blockquote>
While many of the Australian modular builders are focused on single and two storey dwellings, one company has setup a factory in Melbourne which is making multi-storey dwellings: <a href="http://www.hickory.com.au/unitised-building">Hickory Group</a>. Although the company has been building using conventional methods for generations, five years ago it established a modular factory which now employs more than 150 people and is producing more than 500 apartments every year. Many of the employees are drawn from the depleted Victorian automotive manufacturing sector. Since inception, the factory has produced multi-storey modular residential and hotel projects across the country, and engineered a system that can achieve architecturally diverse high-rise buildings.
</blockquote>

Green and Newman furthermore <a href="https://theconversation.com/building-a-housing-industry-from-the-relics-of-a-car-industry-23195" target="_blank">explain</a>:

<blockquote>
The workforce for modular building requires skills that are usually associated with auto manufacturing, rather than traditional building skills. This includes factors such as design upfront, proactive rather than reactive thinking, procuring materials upfront and warehousing components. There is a clear opportunity to up-skill the auto manufacturing industry to building manufacturing.

...
</blockquote>

<blockquote>
Modular will never completely replace conventional building approaches, but it will take a much greater share in the market, particularly for multi-storey buildings. This 21st century innovation offers a much more sustainable option for the construction sector.

Australian manufacturing has a window of opportunity here - to turn around the manufacturing industry from ailing to growing. If we don’t seize the day in building manufacturing, foreign companies will certainly fill the gap in the market, which could lead to job losses in traditional building.
</blockquote>

We agree.

There is a threat any Royal Commission into unions operating in Australia will suck the oxygen out of any potential momentum the manufacturing and construction sectors may gain in the short term and we call on the Victorian and Federal Governments to:

<ul>
<li>demand the corporate entities operating the Holden, Ford and Toyota brands play a major financial role in up-skilling their soon-to-be retrenched workforce for transition into other manufacturing sectors.</li>
	<li>not get bogged down by ideological schadenfreude but rather engage directly with the urban industry and relevant trade unions so that the construction sector can freely innovate and place itself in a position to grow and soak up the talent which will be let go from the automotive sector in the next few years.</li>
	<li>focus Public Transport policy on obtaining a greater public return out of existing road assets by priortising investment in road-based public transport over new commuter freeway projects.  This should involve: bus route straightening, shortening and most importantly of all, dramatically improve frequency and operating hours of all bus routes.</li>
	<li>significantly lift the paltry amount of money spent on expanding non-motorised public transport infrastructure such as bicycle lanes and other pedestrian infrastructure throughout Metropolitan Melbourne.</li>
</ul>
Post 2017 as car manufacture and assembly in Australia ceases, the nation will no longer have an emotional bond with "our" cars and the car will just become another imported commodity.  And with the right public transport policies and budget priorities local bus body builders such as <a href="http://www.volgren.com.au/" target="_blank">Volgren</a> are well positioned to grow and take on laid-off Holden, Ford or Toyota employees. 

Will the pre-fabricated building industry or bus body manufacturing industry supply the sheer number of vacancies required to provide the entire automotive industry workforce with a job over the next 3 years?  Not likely, however they are well positioned to grow considerably if Government, Unions and Industry work together to ensure the environment exists for a dramatic upswing in innovation and growth within the construction sector and demand is boosted for more numerous cleaner and greener vehicles to operate a better bus network for Melbourne.

Preserving the skillsets and providing for the least painful transition for effected automotive workers into other manufacturing sectors is paramount and policy-makers should grasp the opportunity to reshape our cities from the outer suburban edges to the inner urban areas around more sustainable transport solutions that Holden, Ford and Toyota could never provide.
</body></html>

Latest Buying Insights

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

Editor's Picks

Developments

New apartments

New townhouses

News

Latest Buying Insights

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

Editor's Picks

Receive the latest news stories to your inbox

Developments

New apartments

New townhouses

News