Apartment buyers in New South Wales are set to gain a decade of insurance-backed protection against major building defects, after the NSW Parliament passed the Fair Trading and Building Legislation Amendment Bill 2026.&nbsp;

The Bill establishes decennial defect insurance, known in the market as Latent Defects Insurance (LDI), as an alternative to the existing two-year strata building bond. It cleared the Legislative Council with amendments on Tuesday evening (August 4, 2026), with the Legislative Assembly agreeing to those amendments shortly after.

Under the reform, eligible developers can satisfy their statutory bond obligation by taking out an approved decennial-style policy that gives owners 10 years of cover for major structural defects from completion, claimable directly, without first having to pursue developers or builders through costly legal action.&nbsp;

The change forms the final tranche of amendments arising from the 2021 statutory review of the Strata Schemes Management Act 2015 and related legislation.

Resilience Insurance, which originated the cover in Australia and has delivered it in NSW since 2022, welcomed the passage and credited the NSW Government for delivering it.

“This is protection apartment buyers have needed for a long time, and the credit for delivering it belongs to the NSW Government,”&nbsp;said Corey Nugent, CEO of Resilience Insurance.

“Minister Chanthivong and his team have shown real leadership in replacing an outdated two-year bond with cover that matches the lifespan of the buildings people are buying into. Reform like this is what good, evidence-based regulation looks like.”

Resilience has delivered LDI in NSW since 2022, protecting thousands of apartments, giving the State, and now the country, real-world evidence of how decade-long, no-fault protection works in practice.

The reform also places NSW within a wider national shift.

NSW is the third jurisdiction to put decennial cover into law. The ACT legislated for it in 2024, with the scheme taking effect in late 2025, and Victoria passed its own framework on 17 June. Between them, the three cover the majority of Australia's apartment market.

The reform commences once the legislation is proclaimed, which is expected in the coming weeks. From that point, developers of Class 2 residential apartment buildings can meet their statutory obligation with an approved decennial policy in place of the bond.

Buyers who purchased into projects that took out the cover early are among the first in the country to take keys to apartments carrying decade-long structural protection.

“With the legislation passed, the focus now turns to making it work for buyers,”&nbsp;Nugent said.

“There are already thousands of apartments in NSW covered by this insurance, bought by developers who moved early. The question every buyer should be asking in a display suite is a simple one: does this building come with 10-year defect cover, and who stands behind it?&nbsp;

“We look forward to working with the Government and the Building Commission in coming weeks as the framework moves to implementation, and to sharing what we have learned over the past four years so the protection reaches owners as smoothly and quickly as possible.”

Other states are working through their own reform programs. Western Australia has indicated that decennial cover is within consideration a later stage of its reform sequence, and Queensland has been examining the settings as it looks at the development pipeline ahead of the 2032 Olympics.

Resilience Insurance acknowledges the NSW Government’s continued focus on strengthening consumer protection while supporting housing delivery across the State.

Fast Facts: What the reform means

<ul style="color:#222222; font-family:Arial, Helvetica, sans-serif; font-size:small; font-style:normal; font-variant-ligatures:normal; font-weight:400; text-align:start; white-space:normal; background-color:#ffffff; text-decoration-thickness:initial; text-decoration-style:initial; text-decoration-color:initial">
	<li style="margin-left:15px; font-family:Aptos, Arial, Helvetica, sans-serif; font-size:12pt; color:#000000">Proven at scale:&nbsp;Decennial cover has operated in NSW since 2022, protecting thousand of apartments.</li>
	<li style="margin-left:15px; font-family:Aptos, Arial, Helvetica, sans-serif; font-size:12pt; color:#000000">10 years of cover:&nbsp;Protection for major structural defects runs for a decade from completion, claimable directly and with no legal action required.</li>
	<li style="margin-left:15px; font-family:Aptos, Arial, Helvetica, sans-serif; font-size:12pt; color:#000000">An alternative to the bond:&nbsp;Eligible developers can meet their statutory obligation with an approved decennial-style policy in place of the 2% strata building bond.</li>
	<li style="margin-left:15px; font-family:Aptos, Arial, Helvetica, sans-serif; font-size:12pt; color:#000000">Part of a national shift:&nbsp;The ACT has had decennial provisions in force since 2025 and Victoria passed its framework in June. NSW now joins them.</li>
	<li style="margin-left:15px; font-family:Aptos, Arial, Helvetica, sans-serif; font-size:12pt; color:#000000">No-fault, first resort:&nbsp;Owners corporations claim directly from the insurer without first having to establish who is liable for the defect.</li>
	<li style="margin-left:15px; font-family:Aptos, Arial, Helvetica, sans-serif; font-size:12pt; color:#000000">Cost-competitive:&nbsp;At approximately 1.8% of build cost, LDI is typically priced below the 2% bond while offering broader, longer protection.</li>
	<li style="margin-left:15px; font-family:Aptos, Arial, Helvetica, sans-serif; font-size:12pt; color:#000000">Market position:&nbsp;Resilience originated LDI in Australia and has delivered it in NSW since 2022.</li>
</ul>

Fast Facts: What is Resilience LDI?

<ul style="color:#222222; font-family:Arial, Helvetica, sans-serif; font-size:small; font-style:normal; font-variant-ligatures:normal; font-weight:400; text-align:start; white-space:normal; background-color:#ffffff; text-decoration-thickness:initial; text-decoration-style:initial; text-decoration-color:initial">
	<li style="margin-left:15px; font-family:Aptos, Arial, Helvetica, sans-serif; font-size:12pt; color:#000000">Resilience Latent Defects Insurance (LDI):&nbsp;Covers major structural defects for 10 years from completion.</li>
	<li style="margin-left:15px; font-family:Aptos, Arial, Helvetica, sans-serif; font-size:12pt; color:#000000">Consumer-first:&nbsp;Direct claim access, no need for lengthy legal action.</li>
	<li style="margin-left:15px; font-family:Aptos, Arial, Helvetica, sans-serif; font-size:12pt; color:#000000">Cost advantage:&nbsp;At approximately 1.8% of build cost, LDI is typically priced below the traditional 2% Strata Bond while offering broader protection.</li>
	<li style="margin-left:15px; font-family:Aptos, Arial, Helvetica, sans-serif; font-size:12pt; color:#000000">Market leader:&nbsp;&nbsp;Resilience Insurance originated LDI in Australia and is the national market leader.</li>
</ul>

Joel Robinson

NSW parliament passes 10-year defect insurance laws for new apartment buyers

Builder-developer <a href="https://www.apartments.com.au/developers/mcnab-developments">McNab</a> has wasted little time reshaping one of South Brisbane's most significant undeveloped apartment sites after acquiring the property earlier this year.&nbsp;

McNab has lodged plans to scrap an existing approval for two 30-storey towers and instead deliver a single 28-storey residential building, preserving part of the site for a future development opportunity.

The proposal, lodged over <a href="https://www.apartments.com.au/new-apartments/64-peel-street-south-brisbane-qld-4101">64 Peel Street and 9 Cordelia Street</a>, is for a residential-led mixed-use development comprising 124 apartments above a landscaped podium, alongside a boundary realignment that preserves part of the land for a future residential project.

<img alt="First look: McNab resets decade-old South Brisbane approval with 124-apartment tower" data-entity-type="file" data-entity-uuid="743bf564-3f8f-45fc-b8d3-bbf18f5b628f" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/mcnab%20Peel%20st%20podium.png?VersionId=EhCxGrVn_VFH3qTbKnI4WppGwaMnOn0t" />

Designed by <a href="https://www.apartments.com.au/architects/hayball">Hayball</a>, the development will deliver 119 two-bedroom and five three-bedroom apartments across 23 residential levels. A five-level podium will accommodate 135 car spaces, while the ground floor will include a 66 sqm commercial tenancy, an activated residential lobby with work-from-home spaces, and a publicly accessible landscaped plaza linking Cordelia and Peel streets.&nbsp;

Communal amenities will span Level 6 and the rooftop, including indoor and outdoor recreation spaces, a swimming pool, barbecue facilities, kitchen and dining areas, lawn space, sauna, steam room and yoga facilities.

The application also proposes a boundary realignment to create a standalone 1,290 sqm development lot while retaining an adjacent parcel for future redevelopment, allowing the balance of the site to contribute additional housing over time.

Hayball said the architecture has been shaped by the site's elevated corner position at the intersection of Peel and Cordelia streets and Brisbane's subtropical climate.

The design incorporates generous landscaped setbacks, a masonry podium wrapped with planting, large north-facing balconies, and a slender tower profile intended to maximise natural light, cross ventilation and long-range views. The rooftop has been conceived as a wellness-focused retreat overlooking Brisbane, with amenities positioned to capture views towards Mount Coot-tha and the CBD.

<img alt="First look: McNab resets decade-old South Brisbane approval with 124-apartment tower" data-entity-type="file" data-entity-uuid="c5f99e84-6ad8-4a87-82d1-869685b754d2" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/mcnab%20tower%20perspective.png?VersionId=Gw0IuJaSAlk.tvGBxInhZOcQAdIB..2b" />

The planning submission positions the proposal as a response to both changing market conditions and Brisbane's Kurilpa Sustainable Growth Precinct planning reforms.

McNab acquired the site after the previous approval was granted, with the existing scheme no longer reflecting current residential market demands, economic conditions, construction challenges, construction efficiencies or the quality of development outcome now being pursued, the planning report noted.

McNab continues to expand its residential development pipeline across Brisbane and the Gold Coast. The developer recently launched The Tannery in West End, securing more than 60 per cent of apartments before the project's public release. It is also delivering Elements Budds Beach in Surfers Paradise and Lucia Highgate Hill, an eight-apartment boutique development overlooking the Brisbane River.

McNab resets decade-old South Brisbane approval with 124-apartment tower

A steeply sloping Bellevue Hill site is set to accommodate a new mid-rise apartment development, with plans lodged for 20 homes that respond to the site's dramatic topography.

The proposal for the consolidated land at <a href="https://www.apartments.com.au/new-apartments/138a-140-bellevue-road-bellevue-hill-nsw-2023">138A-140 Bellevue Road</a> has been designed by Sydney architecture practice Common Office, which has used the site’s substantial fall to distribute the building’s scale and unlock 20 apartments without presenting the full height to the street.&nbsp;

“The unique design strategy leverages the site’s substantial topographical fall to facilitate increased density, presenting a seven-storey profile to Bellevue Road while rising to 10 storeys at the rear,” Common Office said in its architectural design report.

The apartment mix spans one, two, three- and four-bedroom residences. Four two-bedroom apartments are designated as affordable housing, while the plans also include two adaptable dwellings. The mix is majority three-beds, with the typical three-bed apartment offering around 144 sqm internally, with balconies of around 15 sqm.

The affordable housing component represents 15 per cent of the residential floor area and allows the project to access additional height and floor space under the NSW Government’s in-fill affordable housing provisions. The site also falls within the inner area of the Low and Mid-Rise Housing Policy because it is within 400 metres walking distance of Double Bay Town Centre.

<img alt="First Look: Plans lodged for topography-led affordable housing project in Bellevue Hill" data-entity-type="file" data-entity-uuid="b1230d0f-3bfa-4a11-abaf-0928c66ef345" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Bellevue%20da.png?VersionId=dZeMK3P.OutGjN8ycjsxm8uNsj_QFWQv" />

Common Office has arranged the building around a masonry podium and a lighter upper volume, drawing on two recurring elements of Bellevue Hill’s established architecture: sandstone bases and the vertical proportions of local Inter-war Art Deco apartment buildings.

“The proposal is governed by a holistic design language that reconciles the solid horizontal masonry of the neighbourhood’s podiums with the elegant verticality of its Art Deco heritage,” the architect said.

“The building maintains a consistent rhythmic logic utilising deep recesses and a sophisticated material transition to break down the 10-storey scale into a series of articulated, human-scale volumes.”

<img alt="First Look: Plans lodged for topography-led affordable housing project in Bellevue Hill" data-entity-type="file" data-entity-uuid="0147f503-1af1-4d51-97fb-c2f1cba63a9d" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Bellevue%20bldg.png?VersionId=GoW7q3NlK67OpnePXhk7zvklrlKb72Qc" />

Large-format sandstone tiles will define the lower levels, establishing a robust base that negotiates the change in elevation from Bellevue Road. Above, red-tinted precast concrete frames, recessed balconies, anodised aluminium screens and expanded metal details will create a more vertically expressed façade. Integrated planter beds will introduce greenery across balcony edges and recessed sections of the building.

The elongated northern façade has been divided into three recessed vertical masses to reduce its perceived length. Triangular window elements and metal privacy screens reference the geometry of nearby Art Deco buildings while controlling overlooking toward surrounding homes. The southern elevation will incorporate further privacy screening, landscaped edges and deep balconies to maintain light and ventilation.

<img alt="First Look: Plans lodged for topography-led affordable housing project in Bellevue Hill" data-entity-type="file" data-entity-uuid="e8679cf1-18bc-4447-8a0f-0052b94ab83c" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Bellevue%20da%20rooftop.png?VersionId=5SQqQqRFf76rvE2p1TbxJSweMN70AIbc" />

Private and communal landscaping is distributed throughout the development. A landscaped garden apartment is positioned within the lower portion of the site, while a communal terrace on Level 5 will include a central timber deck, barbecue facilities, resident planting plots and areas for outdoor dining and informal gatherings.

Common Office described the terrace as an elevated sanctuary designed to capture district views and sunlight. Its planting strategy incorporates endemic species associated with the Eastern Suburbs Banksia Scrub, extending the landscape vertically through the building and providing habitat for local flora and fauna.

A second communal outdoor area is proposed at roof level, with built-in seating, paved gathering areas and perimeter planting.

Bellevue Hill is enjoying renewed momentum in the new apartment market, with several boutique developments recently launched and currently under construction. Positive Investment Enterprise is delivering the 16-apartment Kew Palm House on Birriga Road, while Chanine Developments is also under construction at Florian, a 36-apartment project on Banksia Road.

&nbsp;

Bellevue Hill is enjoying renewed momentum in the new apartment market, with several boutique developments recently launched and currently under construction.

First Look: Apartment development pitched for Bellevue Hill, Double Bay fringe

South Brisbane's apartment pipeline continues to build momentum, with <a href="https://www.apartments.com.au/developers/trk-property-group">TRK Property Group</a> lodging plans for a 161-apartment tower on Montague Road as developers accelerate investment across the Kurilpa Sustainable Growth Precinct.

The proposal for 176–186 Montague Road would replace an existing office building with a 20-storey residential tower designed by <a href="https://www.apartments.com.au/architects/cox-architecture">COX Architecture</a>, adding to a growing pipeline of high-density projects reshaping one of Brisbane's fastest-evolving inner-city precincts.

The project has been conceived as a "living building", featuring a flowing tower form, extensive vertical landscaping, and generous communal spaces that respond to the evolving Kurilpa Sustainable Growth Precinct.

TRK Property Group Development Director Matt Kan said the project reflected the confidence developers have in South Brisbane's long-term future.

"South Brisbane is entering an incredibly exciting period, and we see Montague Road sitting right at the heart of that evolution," Kan said.

"With the former Visy site directly opposite us and significant investment planned throughout the broader Kurilpa precinct, there is a real sense of momentum around this part of the city and what it will become over the coming years.

"For TRK, this is an opportunity to be part of that next chapter and deliver a project that responds to where the precinct is heading, while contributing to the continued evolution of Brisbane's river edge."

<img alt="First look: TRK Property joins South Brisbane apartment surge with Montague Road tower plans" data-entity-type="file" data-entity-uuid="590fe1ad-f892-4446-a679-80e33a16d029" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/TRK%20tower%20facade.png?VersionId=uOJStrcKpyHFcPE1w6_9SMAFzVMCcZll" />

The scheme includes a mix of one, two, three and four-bedroom apartments, incorporating multi-purpose rooms in selected residences to provide additional flexibility for home offices or expanded living areas. The proposed mix comprises 15 one-bedroom, 13 one-bedroom plus MPR, 73 two-bedroom, 26 two-bedroom plus MPR, 30 three-bedroom, and four four-bedroom apartments.

Rather than adopting a conventional rectilinear tower, COX Architecture has developed a sculpted form inspired by the movement of the Brisbane River.

"The proposal has been designed by COX Architecture as a 'living building' that responds to the site's riverine setting, floodplain history and evolving urban context within the Kurilpa Sustainable Growth Precinct," the planning report states.

"The architectural form draws from the fluid nature of the Brisbane River, with a curved and undulating tower form that creates a varied architectural edge and avoids a conventional rectilinear tower expression."

The podium has also been designed as an architectural feature rather than a conventional parking structure, with cascading planting, screening and natural-toned materials softening its appearance. Resident parking is elevated above ground level to address the site's flood constraints, while habitable apartments sit above flood planning levels. Upper-level communal facilities are designed to accommodate shelter-in-place arrangements during major flood events.

<img alt="First look: TRK Property joins South Brisbane apartment surge with Montague Road tower plans" data-entity-type="file" data-entity-uuid="01fa15d0-90df-46c7-9555-7941fc45373c" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/TRK%20podium.png?VersionId=mHyua.w1pHGBt9qEdWzrlsv.leztUCwO" />

Communal amenity is a major focus of the proposal. Around 1,815 sqm of shared resident space is proposed across the ground floor, level 19 and the rooftop, including co-working areas, indoor and outdoor recreation spaces, wellness facilities, dining and gathering areas, lawn spaces, a rooftop pool and spa, and extensive landscaping. At street level, a landscaped forecourt and approximately 345 sqm of publicly accessible open space along Montague Road are intended to improve the pedestrian experience while activating the building's frontage.

The development will provide 163 car spaces, including 152 resident bays and 11 visitor spaces, together with 144 bicycle spaces incorporating resident storage, visitor parking, bicycle maintenance facilities and e-mobility charging infrastructure.

The site sits within one of Brisbane's fastest-changing inner-city precincts, less than two kilometres from the CBD and within easy reach of South Bank, West End, the Queensland Cultural Centre and extensive public transport connections. The Kurilpa Sustainable Growth Precinct planning framework is encouraging higher-density residential development to help meet Brisbane's housing supply targets while supporting walkable, transit-oriented neighbourhoods.

TRK Property joins South Brisbane apartment surge with Montague Road tower plans

Article summary

<ul data-end="785" data-start="311">
	<li data-end="459" data-section-id="5hbcyr" data-start="311">Pikos Group has released the five-penthouse collection at Skye Kangaroo Point, headlined by a two-storey sky home spanning more than 1,000 sqm.</li>
	<li data-end="561" data-section-id="1p7lq8n" data-start="460">Early buyer interest suggests the residences could set a new Queensland apartment price record.</li>
	<li data-end="667" data-section-id="1y70z0l" data-start="562">The collection includes four move-in ready penthouses and the highly customised Skye One residence.</li>
	<li data-end="785" data-section-id="yvm0y1" data-start="668">The release caps one of Bri​sbane's most ambitious luxury apartment developments overlooking the Brisbane River.</li>
</ul>

<hr data-end="790" data-start="787" />
Pikos Group has released the five-penthouse collection at its <a href="https://www.apartments.com.au/buildings/skye-residences-by-pikos-kangaroo-point-8-river-terrace-kangaroo-point-qld-4169">Skye by Pikos</a> development in Kangaroo Point, with early buyer interest indicating the flagship residences could eclipse every apartment sale previously recorded in Queensland.

The collection crowns the luxury riverfront development with five residences, including four completed penthouses and Skye One, a two-level sky home spanning more than 1,000 sqm that will be tailored to its eventual owner.

[smartcode_project:default project_id=90059 project_image_fid=374075]

Wanting to offer a fully customisable home, Pikos is offering Skye One as a blank canvas, allowing the buyer to work alongside the developer's design team to customise the home's layout, finishes and internal spaces.

The residence will feature a 247 sqm private rooftop terrace with its own swimming pool, sauna, steam room, outdoor kitchen and multiple entertaining areas overlooking the Brisbane River and CBD skyline.

The remaining four penthouses have been completed and are ready for immediate occupation, each offering four bedrooms, expansive open-plan living areas, soaring ceilings and private lift access.

[smartcode_project:default project_id=90059 project_image_fid=374059]

One of the defining features throughout the project is its use of Roman Classic Travertine, with more than 20,000 sqm of the natural stone imported from Italy after being personally selected by Pikos Group Founder and Executive Director Pedro Pikos, interior designer Julie Williamson and third-generation stone specialist Mario Caucci.

Pikos said the penthouse collection represented the culmination of the company's long-term vision for Skye.

"True legacy isn't measured by what we build today, but by what endures tomorrow," Pikos said.

"Our ambition is to create places that become more valuable with time, enrich the lives of generations, and stand as timeless landmarks long after we've stepped away."

[smartcode_project:default project_id=90059 project_image_fid=374060]

Williamson said the interiors were inspired by the natural character of Kangaroo Point and the Brisbane River rather than international design trends.

"Materiality tells the story of a place," Williamson said.

"We looked to the movement of the Brisbane River, the texture of the cliff face and the warmth of the surrounding landscape to create interiors that feel understated, enduring and unmistakably Brisbane."

Positioned above the Kangaroo Point cliffs, Skye places residents within walking distance of Howard Smith Wharves, South Bank and James Street while offering uninterrupted river and city views.

[smartcode_project_cta:default project_id=90059]

Brisbane's next apartment price record? Pikos unveils Skye's exclusive penthouse collection

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?

Prominent New Zealand apartment and hotel operator, <a href="/developers/safari-group">Safari Group</a>, is offering up a prime investment opportunity for Australians to purchase off the plan in one of the world’s most popular ski destinations.

They recently took to market Mountain Oak Queenstown Apartments, in the growing precinct of Remarkables Park in Frankton, near the airport and at the foot of The Remarkables - the mountain range the locals like to call “The Remarks”.&nbsp;

Sydney investors have shown interest in the one, two and three-bedroom apartments that secure high-season occupancy six months over the year, primarily over summer and winter months.

They average 90 per cent occupancy across their portfolio over January, February, March, August, November and December, while shoulder season months of April, July, September and October are still occupied 70 per cent of the time, with the growing appeal of Queenstown becoming not just a hotspot for the snow, but a lifestyle destination.

Even in the low seasons of May and June, occupancy levels reach around 40 per cent.

<img alt="Safari Group’s Mountain Oak Apartments brings new investment potential to Queenstown" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/f_auto,c_limit,w_1440,q_auto/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/field/image/Ext_Cam15_Sunny.jpg?VersionId=SJAROUM_1s.Tr5ciMk4EEj5oAt_Vewmv" />

Safari’s Safari Hotels arm can also manage the holiday letting for an investor, from the listing on holiday accommodation websites such as Airbnb and Booking.com to the cleaning and maintenance of the investment. They’ve been in the short stay management business for 15 years and offer 24/7 support for investors, an important convenience benefit for any overseas investor

Another major drawcard for Australians is that New Zealand doesn’t have a stamp duty policy - so the entry price of NZ$639,000 (AU$586,000), is all that is payable on completion.

<img alt="Safari Group’s Mountain Oak Apartments brings new investment potential to Queenstown" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,dpr_2.0,q_auto:good/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/313_Livingv2_WEB.jpg?VersionId=nV229fM0ZeYpoxOrX372HyGjfwY_LR8c" />

Safari is starting construction of the 141 apartments in Q2 this year, with a two-year build estimated to complete in mid-to-late 2027.<img alt="" data-entity-type="" data-entity-uuid="" height="15" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXczFpFAb7WuA6f4f9TtKWcqXyNwR8qqtakWv352ERkpqNlP3KwIo8YKxw67jZNHfpjEGIZGv5MQTbnvLZwNt8iu9IVdOrswOjCvBZ4zhSoOOLrpt6etVEZTN1gkBho0r_R72zdHNA?key=yq3daOanqHSb88QFd8jGYKdb" title="Click and drag to move" width="15" />​

The apartments will feature modern amenities and contemporary designs with expansive windows capturing sweeping views of The Remarkables mountain range.&nbsp;

Interiors are equipped with modern finishes, premium appliances, and secure electronic key-locked doors, ensuring a comfortable living experience for residents and guests alike.

With its strategic location near Coronet Peak and Cardrona Alpine Resort, as well as key retail and dining precincts such as Market Street, Five Mile Shopping Centre, and Remarkables Market, Mountain Oak offers a strong proposition for investors seeking high rental yields and capital appreciation in one of New Zealand’s most sought-after locations.&nbsp;

Queenstown’s sustained demand for visitor accommodation and rental properties is underpinned by a shortage of housing options, attracting both local and international buyers.

Safari Group offers low-touch investment proposition in Queenstown’s popular ski fields district

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While it has become cheaper for banks to raise wholesale funding from offshore investors, a desire to seek "more stable funding sources" has caused customer deposits to increase to nearly 50% of banks' funding base, according to the RBA’s September Financial Stability Review.
The review says banks' use of offshore long-term debt has been broadly unchanged since 2007, accounting for a quarter of all liabilities, while there has been an increase in the use of deposits "across all types of banks in Australia, although it has been most pronounced for the regional and other smaller Australian-owned banks, which had previously used securitisation more heavily".
<img src="/images/stories/2012/09/rbasept26.gif">
In terms of offshore funding, the RBA notes pressures in wholesale funding markets have eased since late last year, “allowing the large banks to maintain good access to international bond markets during the past six months”.
“The ongoing difficulties in Europe have been contributing to volatile funding conditions for Australian banks, but in recent quarters wholesale funding pressures have eased from the levels of late last year.
“Offshore investors have focused on the relatively strong position of the Australian banks compared with those in some other countries. The banks have therefore been able to take advantage of periods of more favourable market conditions to issue opportunistically,” says the RBA.


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Australian banks have issued around $50 billion of bonds in the past six months, mostly in unsecured form, says the RBA.
“Banks’ bond spreads have narrowed, and are now comparable to levels in mid-2011, prior to the escalation of the euro area debt problems. This has enabled the banks to issue a larger share of their bonds in unsecured form than they did at the beginning of the year when tensions in global funding markets were high.
“Even so, banks have reduced their relative use of wholesale funding further as growth in deposits has continued to outpace growth in credit."
The report also shows that banks have little exposure to the more volatile eurozone with just 1.6% of their assets based in this market, but says they remain exposed to swings in global financial market sentiment associated with the problems in Europe.
However, according to the RBA, Australian banks should be more resilient to such episodes, given the improvements they have made to their funding, liquidity and capital positions over recent years.
“Around half of the banks’ funding now comes from customer deposits, which is a broadly similar share to a number of other comparable countries’ banking systems."
Overall, the RBA says the Australian banking system has remained in a “relatively strong position”.
Following the GFC, the major banks blamed rising offshore funding costs for interest rate increases outside of the RBA cycle.
But recently the focus has shifted to the rising cost and battle among banks for customer deposits.
ANZ has stopped providing commentary on its independent interest rate decisions, but in July ANZ chief executive Australia Philip Chronican noted that competition in the deposit space was benefiting customers but “also continuing to put pressure on margins”.
Chronican also remarked that offshore funding markets had stabilised “somewhat” but added that the bank continued to “monitor events closely”.
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lschlesinger-FZcF9M3vE6

Offshore funding pressures ease but banks now more reliant on customer deposits for mortgage lending: RBA

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Angie Zigomanis, senior manager of BIS Shrapnel: 
There have been several reports on the number of households as reported by the Australian Bureau of Statistics 2011 census in relation to estimating the number of households nationwide. The most commonly reported number of households reported is 7.8 million.
Researchers and analysts have been using this number as a justification or otherwise of claims that the housing market is in undersuply are legitimate. However, a pure count of households or occupied dwellings in itself doesn't say much at all. A count of households and occupied dwellings just tells you that one equals the other. Therefore it doesn’t measure whether there is any underlying undersupply. However, an oversupply can be measured if there are a rising number of unoccupied dwellings.
Some analysts compare their count of the number of households with the National Housing Supply Council estimate of the underlying level of households to provide evidence that the market is in oversupply. The 7.8 million households at the census normally bandied about by commentators compares with the National Housing Supply Council underlying figure of 8.8 million households to imply the NHSC overstated households at 2011 by 1 million, and therefore its estimate of undersupply was actually an excess.
However, a closer look at the 7.8 million households quoted by most industry commentators shows that this figure is just plain wrong. This is the result of these commentators plucking a headline figure from the census data without taking a closer look at the numbers behind the numbers.
When looking at household numbers to determine demand, the number of households will equate to the number of occupied dwellings – i.e. when a household is created it needs to occupy a dwelling. However, the figure that most commentators refer to for the number of households falls well short of the number of occupied dwellings on census night. To find this figure, we need to examine the census data based on place of enumeration.
The place of enumeration count is the physical count of all households in the dwellings where they were counted on census night. This shows that there were 7.8 million households nationally. However, this actually only refers to the households for which they have obtained household structure information. There are two other categories of households occupying dwellings that have not been accounted for. These are "not stated" households and "visitor only" households.
“Not stated” households are dwellings where the census collector has confirmed that someone was present, but was not able to get a completed census form to confirm the household structure. This happens across all dwelling types but is most prevalent in high-rise apartment buildings, where it is difficult to access the dwellings to drop off and pick up the forms (which is why the internet was introduced as a means of filling out the forms). While the type of household has not been confirmed, there is nevertheless a household in the dwelling. There were 279,000 “not stated” households on census night across Australia.
“Visitor only” households are households where all the occupants are not at their usual place of dwelling. This could be overseas visitor households (but not necessarily short- term holiday households), dwellings where the occupant might be away for work, households that were at their holiday house on census night, etc. While not permanently living at the dwelling, they nevertheless reflect demand for dwellings as there will always be a component of the population occupying and requiring a dwelling on this basis. There were 143,000 “visitor only” households on census night.
When comparing households over time, a further adjustment can be made in 2011 for persons who were overseas on holidays. The high Australian dollar has meant that a greater proportion of Australians were overseas on census night. At the 2001 and 2006 census, around 1.7% of Australians were recorded as being temporarily overseas on census night. However, on the 2011 census night, around 2.1% of residents were temporarily overseas. Based on the 2011 population, this reflects an extra 100,000 or so persons, or around 40,000 additional households that weren't counted. Remember that the household count reflects the physical count of occupied dwellings on census night, so the dwelling would have been recorded as empty. Conversely, subtracting these households from the unoccupied dwelling count reduces the unoccupied dwellings from equivalent to 11.4% of households to 10.8% of households, which is below the 11% of households at the 2006 census – another indicator of a tightening market over the last five years.
Adding all of these components – 7.76 million households counted, 279,000 “not stated” households, 143,000 “visitor only” households, and an allowance for an extra 40,000 households being on an overseas holiday on census night than there would normally be – provides a total houshold count, and therefore occupied dwelling count, of 8.22 million occupied dwellings.
This is still well below the NHSC underlying household count of 8.8 million households in its most recent State of Supply report (although closer to BIS Shrapnel’s pre-census figure of 8.3 million that was used to calculate the underlying stock deficiency in the June 2012 editions of our Residential Property Prospects and Building in Australia reports). However, it should be remembered that the NHSC figure (and BIS Shrapnel’s) is not an estimate of actual households, but an estimate of the underlying requirement for households, which is the number of households that would normally be expected in an unconstrained environment – i.e. under normal dwelling supply and affordability circumstances.
BIS Shrapnel’s forecasts of households used in calculating underlying demand are based on trends over time in household formation rates across different age groups, which accounts for changes in demographic trends as well as the likely impact of housing affordability constraints on household formation. In many states it is assumed that the reduction in household formation between 2006 and 2011 due to a deterioration of affordability (both owning and renting) has now become permanent and is unlikely to recover in the foreseeable future. This then places most of the states at, or close to balance, in most states.
Based on the 2011 census data, BIS Shrapnel’s estimate of the deficiency at June 2011 is 37,000 dwellings, concentrated in New South Wales, where the number of households appears lower than it otherwise would be (than explained by prevailing trends in household formation rates) due to people being forced to squeeze into the existing dwelling stock.
A national deficiency of 37,000 dwellings at 2011 was insufficient to drive any upturn in dwelling construction in 2011-12. However, declining new dwelling completions, even at the lower level of new household formation rates derived from the 2011 census, have fallen below underlying demand in 2011-12, and a rising deficiency is now emerging. As the deficiency continues to rise, it will first be seen in vacancy rates (already evident in Brisbane and Perth), before flowing through to rental growth, construction, and some level of price growth.
Angie Zigomanis is senior manager of <a title="BIS Shrapnel" href="https://www.bis.com.au/" target="_blank">BIS Shrapnel.</a>
 
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Michael Matusik, founder of Matusik Property Insights:
So, does Australia have too few, too many, or is the situation just about right?
I am talking about new dwellings.
I have been arguing for some time that one of the biggest real estate myths in this country is that the new housing market is undersupplied; and often this situation is described with words such as “massive”, “chronic” or “enormous”.
But is it true?  As followers of the Matusik Missive know, I have tried to prove that it is false and with, for mine, with quite a degree of finesse.  Yeah, like a bull in a china shop.
Anyway, each year I like to go back and check the numbers.  And last week’s annual check-up has found that Australia continues to build more dwellings than we need.  A few years back – in 2008-09 – not enough new homes were being built, but in recent years, and despite the constant calls from the building industry for stimulus to help create even more new dwellings, we have been building too many.
In the 2009 financial year, Australia needed to build 167,000 new dwellings, yet only 131,000 or thereabouts were commenced.  However, in 2010 (all years in this post are financial ones), the supply-demand balance reversed, with just 121,000 new homes needed, yet 167,000 actually commenced construction.  During 2011 the industry continued to build far more homes than what was actually needed, to the tune of about 47,650 too many.
The good news is that the rate of overbuilding has slowed down over the last 12 months, with 137,000 new dwellings needed during 2011-12 and with 139,000 actually supplied.
However, dwelling supply (we are talking about actual commencements here and not approvals) is cumulative and since the GFC, Australia has built about 60,000 more new dwellings than it really needed.
Nationwide, we are currently oversupplied with new digs to the tune of about five months, based on current underlying demand.  In short, we could, as a nation, stop building for several months and still have enough new homes to fulfil our needs.
But of course, there are always swings and roundabouts.
Several states and territories are undersupplied, some are chronically oversupplied – I just had to get that in – while others have way too much stock.
Major oversupplies now exist in Victoria; South Australia, Tasmania and the ACT.
Since 2009, Victoria has created 69,000 (yes 69,000 – that’s five digits with a six at the front!) too many new dwellings.  This represents about a two-year oversupply based on the current annual underlying demand for 34,000 new dwellings across the state.
South Australia has built 18,000 too many new homes, but with a need to just build about 6,000 new dwellings per year, South Australia really shouldn’t need to build a new home for years, well close to three, in fact.
There are 6,000 too many dwellings built or being built in Canberra.  This equates to 30 months of supply.  And poor Tassie has also overbuilt, and also in the high 4,000 range.  But Tasmania’s situation is further exacerbated by its declining population growth.  Based on a continuation of last year’s paltry population increase of 1,000 people, Tassie’s 4,800 overbuild represents close to nine years of demand.  Now might be a good time to steal a new property on the Apple Isle.
The Northern Territory is now also oversupplied, with 350 too many dwellings created in recent years.  The demand for new homes in the territory is limited (at about 800 per annum), so this paltry 350 over-hang represents six month’s demand.
In stark contrast, New South Wales hasn’t been building enough new stock – no surprise there – but the undersupply is to the tune of 13,000 or about five months of current demand.
Western Australia is also undersupplied by about 23,000 dwellings at present, which equates to about a nine-month demand.
Finally, Queensland has a new dwelling short-fall of 2,800 or two weeks of undersupply.
Last year’s statistics, however, suggest that Queensland is now heading towards a massive undersupply, with 33,000 new dwellings needed during 2012, yet just 26,000 supplied – an undersupply in the tune of about 20%.
Let’s hope the Newman government’s recent $15,000 first-home buyers' grant for new construction kicks some arse.  But for mine, it will not deliver the spanking it was intended to.
Michael Matusik is the founder of <a href="https://www.matusik.com.au/" target="_blank">Matusik Property Insights</a>, which has helped over 550 new residential projects come to fruition.  Read <a title="blocked::https://www.matusikmissive.wordpress.com /" href="https://www.matusikmissive.com.au/" target="_blank">Michael's blog</a> or follow him on <a href="https://www.twitter.com/michaelmatusik" target="_blank">Twitter</a> or connect via <a href="https://www.linkedin.com/in/michaelmatusik">LinkedIn</a>.
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angiezigomanis-VT64gGbExQ

Room for debate: Is Australia's housing market under or oversupplied?

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The effects of the mining boom continue to flow through to Perth’s hotel sector, which has now surpassed Sydney in terms of occupancy rates and revenue growth, according to the latest Dransfield report.
Perth hotel occupancy rates improved by 5.8 percentage points to reach 87.5% over the first three months of the year, while Sydney recorded a 1.8 percentage point decline in occupancy to 81.8% and Melbourne edged up 1.5 percentage points to 80.1%.
There was some improvement for the tourism-dependent Cairns market, with the occupancy rate increasing by 8.3 percentage points, but to a still low 51.7%. Occupancy rates on the Gold Coast increased by 6.1 percentage points to 71%.
Hotels in the west coast capital city also significantly outperformed Sydney and Melbourne on the key metric of revenue per available room (revPAR), which rose 22.1% over the quarter.
Sydney hotels' revPAR was flat (-0.1%) over the March quarter while there was modest gain in Melbourne (up 2%).
In its previous outlook report, Dransfield noted that Perth had rebounded to again be the "outperforming hotel market, with demand growth rebuilding confidence following the fall in 2009".
Dransfield forecasts revPAR growth at around 7.5% for the medium term to 2013 and 2.6% for the full forecast period to 2019 as new hotel supply comes on board.
“The Western Australian government is actively trying to encourage development, through financial incentives to promote new hotel development,” noted Dransfield in its 2011 Hotel Futures report.
Dransfield attributed the relatively poor performance of Sydney hotels to a “combination of a softer conference and government market and lack of large-scale events”.
The Brisbane hotel sector also performed strongly over the March quarter with revPAR up 17% over the quarter. However the Brisbane hotel occupancy rate fell from 82.5% in the December quarter to 77.6%.
Adelaide was also a strong performer, recording 12% revPAR growth over the quarter.
Click to enlarge
<a href="/images/stories/2012/09/dransfield.jpg" rel="shadowbox" title="Click to enlarge"><img src="/images/stories/2012/09/dransfieldthumb.jpg"></a>
Nationally, Australian hotels recorded revPAR growth of 5.3% compared with 4.8% for the prior corresponding period and 4.6% for the full year in 2011. This compares to full year expectations of 6.1%, with the results dragged down by Sydney and Melbourne.
Rate and occupancy both grew by 2.6%, evenly contributing to the March quarter results.
RevPAR growth was ahead of the 3.4% recorded in the December quarter.
National occupancy remains high at almost 77%, however this is still below the pre GFC level of 78.5% in 2007.
Room rates have continued to increase and at $167.11, have now moved well beyond the previous high of $162.31 in March 2008, says the Dransfield report.
Looking ahead, Dransfield expects Australia’s city hotel markets to continue to perform well in the short term, despite scope for volatility.
“Some uncertainty remains related to the recovery of leisure markets and the ongoing impact of the European financial woes.”
“Supply under construction and new proposals remain limited. The three year outlook sees a mixed performance in revenue growth, with some cities in the 7-10% range and others with little growth or even declining."
Dransfield Hotels &amp; Resorts are a specialist professional services organisation advising tourism and hospitality enterprises and has advised on hotel projects involving over 40,000 hotel rooms.
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Perth surpasses Sydney as best-performing hotel market: Dransfield

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Sydney sales dominated the week's top 10 RP Data sales list but the highest priced sale was at a $1,025 million discount to its last sale price in pricey Vaucluse.
The 15% price fall ranks among the most severe realised loss reported in the prestige property downturn that lingers well after its global financial crisis induced downturn in 2008.
The Vaucluse Road, Vaucluse property had last traded at $6,875,000 in 2006 when bought by businesswoman Deborah Ricci.
"Presiding over majestic views of the City, Opera House, Bridge &amp; Harbour, this "Sleeping Beauty" is discreetly elevated, almost hidden from the road and enjoys quiet privacy," its selling agent D'Leanne Lewis at Laing &amp; Simmons Double Bay said. The second placed Woollahra sale ranks among the more common trend of sales at well below initial vendor expectations. It had been listed in April with $6.5 million plus hopes through the same agent who secured $5 million at its wekeend auction. Glen Rhoda, the circa-1863 Gothic-style residence on Wallaroy Road last traded for $6.15 million in 2004 when sold to the Tassone family by the INXS drummer Jon Farriss who had bought it for $2.4 million in 1991 from film producer Margaret Fink, who'd lived there since 1968 when she purchased it for $74,000.
Meanwhile Melbourne agents endeavour to keep prestige sale prices somewhat under wraps.
There were two Melbourne sales - in Hawthorn and Brighton - which ought have been on the list but had prices withheld including <a href="/news">Rathgar at Hawthorn </a>which reputedly sold for $5 million plus. It had actually been listed for by invitation only auction with $5 million plus hopes.  
1. <a href="https://www.myrp.com.au/n/29-vaucluse-road-vaucluse-nsw-2030/myrp-490?propertyId=7146386">29 Vaucluse Road, Vaucluse, NSW, 2030</a>, five-bedroom house, sold at auction on September 19 by Laing + Simmons Double Bay for $5.85 million
2. <a href="https://www.myrp.com.au/n/71-wallaroy-road-woollahra-nsw-2025/myrp-490?propertyId=7743249">71 Wallaroy Road, Woollahra, NSW, 2025</a>, five-bedroom house, sold at auction on September 22 by McGrath Estate Agents for $5 million
3. <a href="https://www.myrp.com.au/n/101-raglan-street-mosman-nsw-2088/myrp-490?propertyId=4501660">101 Raglan Street, Mosman, NSW, 2088</a>, five-bedroom house, sold at auction on September 22 by Richardson &amp; Wrench Mosman/Neutral Bay for $3.675 million
4. <a href="https://www.myrp.com.au/n/41-dorking-road-cabarita-nsw-2137/myrp-490?propertyId=1665485">41 Dorking Road, Cabarita, NSW, 2137</a>, five-bedroom house, sold at auction on September 22 by Haus Real Estate Strathfield for $2.9 million
5. <a href="https://www.myrp.com.au/n/24-wallis-parade-north-bondi-nsw-2026/myrp-490?propertyId=4960670">24 Wallis Parade, Bondi Beach, NSW, 2026</a>, five-bedroom house, sold at auction on September 20 by Raine &amp; Horne Double Bay for $2.715 million
6. <a href="https://www.myrp.com.au/n/5-33-sutherland-crescent-darling-point-nsw-2027/myrp-490?propertyId=2064421">5/33 Sutherland Crescent, Darling Point, NSW, 2027</a>, three-bedroom unit, sold at auction on September 20 by Raine &amp; Horne Double Bay for $2.7 million
7. <a href="https://www.myrp.com.au/n/9-ebsworth-road-rose-bay-nsw-2029/myrp-490?propertyId=5916924">9 Ebsworth Road, Rose Bay, NSW, 2029</a>, four-bedroom house, sold at auction on September 18 by L J Levi Real Estate for $2.675 million
8. <a href="https://www.myrp.com.au/n/25-parlington-street-canterbury-vic-3126/myrp-490?propertyId=10258012">25 Parlington Street, Canterbury, VIC, 3126</a>, four-bedroom house, sold at auction on September 22 by Kay &amp; Burton Hawthorn for $2.522 million
9. <a href="https://www.myrp.com.au/n/61-james-cook-island-sylvania-waters-nsw-2224/myrp-490?propertyId=6645581">61 James Cook Island, Sylvania Waters, NSW, 2224</a>, five-bedroom house, sold at auction on September 22 by Ray White Sylvania Waters for $2.4 million
10. <a href="https://www.myrp.com.au/n/16-earl-street-randwick-nsw-2031/myrp-490?propertyId=5751260">16 Earl Street, Randwick, NSW, 2031</a>, three-bedroom house, sold prior to auction on September 22 by GoodyerDonnelley Real Estate for $2.1 million 
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Two $1 million plus mansion losses head RP Data top 10 sales 

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I keep a file of events claimed by banner-wavers to destroy property values, and I thought I had a complete list.

But a new one has popped up on Queensland’s Sunshine Coast: construction of an Aldi supermarket.

This one has me even more baffled than the other items on the list of value destroyers. There is no research evidence that having an Aldi in your neighbourhood decimates house prices – indeed, the quick exercise I did this morning indicates the opposite.

But this phenomenon of residents bellowing outrage over their property values being destroyed by all manner of things is becoming quite bizarre.

The broad list of resident evils includes development of townhouses in the street. A retirement village down the road. A Buddhist temple (aren’t they the terrorist people?). A detox centre in the suburb (maybe that one has some validity). A refugee processing facility outside the town. Mining somewhere in the region. An NBN transmission tower on the horizon.

Seaweed washed up on the local beach is deemed to de-value million-dollar waterfront homes.

Wind farms are a great favourite among the hysterical. The list of disasters deemed likely to flow from the presence of wind turbines (including cows unable to give milk and chickens refusing to lay) is annihilation of property values for any home with a distant turbine view.

And few things create a neighbourhood meltdown like plans for a mosque.

It’s an issue I’ve followed for years and here’s the thing: none of the people protesting about their property values being hurt by these and other “nasties” ever produce any research evidence to show that their concerns have some foundation.

This is, I’m sure, because the research doesn’t support them. Often it shows the opposite.

Lakemba has the largest mosque in Australia in its midst, and it has averaged 8.5% in annual growth in its median house price in the past three years, one of the best results in Sydney. The suburb’s median unit price has done even better, averaging 10% per year growth over the past three years and 8% per year average growth over the past five years.
But facts are a minor annoyance to people who get a bee in their bonnets about something deemed undesirable for their locale.
 
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Some of the residents of Brightwater estate in the suburb of Mountain Creek on the Sunshine Coast clearly haven’t got enough to do with their time, because they’re wasting it on a noisy protest about plans for a supermarket in their neighbourhood.

Retail facilities are generally considered a bonus for a suburb, providing a desirable alternative to having to drive outside the area to find a supermarket.

But the issue here is not so much that it’s a supermarket but that it’s an Aldi. My god, the Germans!

The rhetoric from the outraged citizens of Brightwater suggests that only bogans shop at Aldi and, frankly my dear, it lowers the tone.

This distresses me, as I and my partner like to shop at Aldi. It’s the cheapest place for supermarket goods by a considerable margin. All supermarket chains claim to have the lowest prices, but the independent research shows that the only venue that is consistently cheaper is Aldi.

But a spokesperson for Brightwater Residents against Aldi (yes, they’ve formed an action group and called it BRA) says: “Aldi is not suited for Brightwater’s demographics.” Another resident says: “It will hurt the demographics as it’s not a classy store. Brightwater is known to be modern and upscale. The prices of houses will definitely be affected.”

So clearly, the issue here is snobbery, even though Mountain Creek is hardly upmarket real estate. The median house price is in the mid-$400,000s, and it’s your typical mainstream suburb of brick-and-tile homes on blocks the size of a postage stamp. It’s pretty much Fountain Lakes (the fictional domicile television’s Kath and Kim) with a slightly better climate.

But the biggest beef for the bellicose burghers of Brightwater is that it will lower house prices.

Really? Let’s look at some figures.

Mountain Creek, currently bereft of an Aldi store, has recorded a 5.2% drop in its median price over the past 12 months. Indeed, values have been falling over the past three years. The 10-year average of 7.4% a year is better news, but very ordinary by national standards.

Let’s compare that with another Sunshine Coast location, Beerwah, which does have an Aldi store. Beerwah values have been growing at an average rate of 10.6% a year.

In the Brisbane metropolitan area, the number-two suburb for capital growth, averaging 13.5% a year, is Booval in the south-west near Ipswich. Booval has an Aldi store.

Kingston, in Logan City in the south of the metro area, has a capital growth average of 12.2% a year, despite the presence of a German supermarket.

Springwood, Bald Hills, Browns Plains, Loganholme and Oxley are all suburbs of Brisbane with double-digit growth rates and Aldi stores.

There are Aldi stores in Sydney suburbs like Marrickville and Leichharst, both near-city locations with median house prices around $800,000.  Despite the Teutonic retail influence, both have averaged median house price growth of 7%-8% per year over the past three years and similar averages over the past five years.

North Sydney has a median house price above $1 million, a tad more ritzy than bogansville-by-the-bay on the Sunshine Coast, but they put in an Aldi store and property values have kept growing, averaging 5% in recent years.

Based on that evidence, the Brighwater folk with too much time and too little to do can put away their banners, take a sedative and go back to watching The Bold and the Beautiful.

Terry Ryder is the founder of <a target="_blank" rel="nofollow" href="https://www.hotspotting.com.au/">hotspotting.com.au</a> and can be <a target="_blank" rel="nofollow" href="https://www.twitter.com/hotspotting">followed on Twitter</a>.
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Banner-wavers need not be hysterical, as an Aldi is not going to de-value house prices: Terry Ryder

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The Reserve Bank will cut interest rates to spur on economic growth as the federal government remains committed to achieving a budget surplus in 2012-13, according to Alan Mitchell, economics editor at the Australian Financial Review.
Yesterday Federal Treasurer Swan released the budget outcome for the 2011-12 financial year showing a slightly better deficit outcome of $43.7 billion and restated the government's commitment to return the budget to surplus in 2012-13
Swan also acknowledged that the decline in commodity prices would inevitably make the task more difficult as it targets a very small underlying cash surplus of $1.5 billion for 2012-13.
Mitchell says the RBA’s concern will be the “impact of fiscal policy on economic output and inflation over the next two years”.
“The savings needed to balance the budget in the next two financial years are now more manageable, but they will be in addition to all the other sand that is being thrown into the economy’s wheels from the truncation of the mining investment boom, the global economic uncertainty and the strong dollar,” he says.
“With inflation already low, the RBA will cut rates to support economic growth. That will help exchange rate- and interest rate-sensitive activities including housing, manufacturing and tourism.”
A similar sentiment is echoed by HSBC Australia chief economist Paul Bloxham in a commentary piece examining how the current mining boom differs from past mining boom.
Bloxham says the financial system is “not overly leveraged into the mining story, as it has been on some occasions in the past".
“Having escaped the global financial crisis reasonably unscathed, Australia's banking system is also in pretty good shape such that conventional monetary policy still works.
“When the mining story fades, which is not yet, there will be room for other sectors to pick up and growth to rebalance. Rebalancing will be assisted by the steady Australian dollar and below-average RBA rates, though some further adjustment to RBA rates will probably be necessary.
"We continue to expect another RBA cut before year-end.”
Bloxham also warns that achieving the “political imperative” of achieving a surplus will be even harder given the recent falls in commodity prices. “Discretionary fiscal tightening in the face of weakening conditions, if it occurs, does not seem like the right move, in our view, but it is a risk. 
The chief risk he says is China.
“Our central case holds that China's growth cycle is currently bottoming out, with growth forecast to pick up to 8.4% next year. This is expected to support demand for commodities and prevent prices from falling too much further.” 
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RBA to cut rates to ensure economic growth as government commits to budget surplus: AFR’s Alan Mitchell

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Here are several common misconceptions I frequently hear when people are looking to invest in commercial property.
1. Securing properties using the internet is easy – you don't need any professional help at all.
Finding a suitable property is only half the task.
The other half involves properly assessing the property — both physically and financially. And then you have to package up the deal that's best for you.
And this is where having a top consulting team (for the property, legal, finance and construction aspects) is worth its weight in gold.
2. Residential investors will find it a difficult transition.
This stems purely from a lack of knowledge and therefore, proper understanding. And that's where your consulting team comes in.
Some of my most successful clients have been those with little or no prior involvement with commercial property. However, they were clear thinkers and could quickly assess the advice being given to them.
3. You need loads of cash
Again, this is simply not true. Sure, many commercial properties may sell for millions of dollars. But you can also buy well-leased strata office suites for between $350,000 and $500,000. And this more or less the same price as you would pay for an apartment.
However, your net return for one of these smaller office suites is around 7% per annum, compared with a 3.5% net return for apartments. So I'll leave you to do the maths!
4. Commercial tenants are difficult to deal with.
Because commercial tenants are running a business from your property, they have a vested interest to keep it looking presentable.
Besides, their lease will require them to undertake (and pay for) any required maintenance. And when the time comes for them to leave, there is also a clause requiring them to "make good" beforehand.
5. It's harder and more expensive to manage commercial property.
If you choose to manage the property yourself, then you may well run into some costly problems. But that's the very reason why you would engage a competent managing agent.
And unlike residential management fees of 7%, your fees to manage commercial property will generally range between 3% to 5% of monies collected — depending upon the size of the property involved.
Bottom line: Hopefully, this short summary has helped to dispel some of the common myths surrounding commercial property.
Chris Lang is an advisor to commercial property investors and gives keynote speeches and regular seminars on the best way to invest in commercial property. He maintains a blog, <a href="https://bitly.com/IFf40C">his-best.biz</a>, which he updates regularly about the best way to get the most out of your commercial property investment.
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chrislang-EQKojcgJPV

Five common myths about commercial property investment: Chris Lang

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Now we’ve established that the spring selling season has not immediately transformed the housing market from its winter of discontent, and the barrage of "spring has sprung" headlines have once again done the rounds and subsequently been exhausted.  We can perhaps start looking at the reality that’s facing a rather sick real estate market, which needs a little more than a Paracetamol to recover from recent lows.

It’s easy to come up with excuses to explain the current malaise.  Consumer confidence is a favourite – albeit overused – term.  However, it tends to suggest the market doldrums are nothing more than a brief bout of post-winter blues that simply require a short-term prescription of Prozac to recover.

The sickbed approach to market movements always assumes healing will eventuate sooner or later and based on the well-quoted premise of historical cycles, it’s not an altogether foolish assumption.

After all, although we’re consistently told the consumer has a new aversion to debt, it doesn’t stop Australians over-spending in areas where they perceive value – areas such the recent surge in overseas travel for example, and the lending boom for new and used vehicles – both of which have been influenced by the strong Aussie dollar and recent tariff cuts.

We’re fickle creatures when it comes to finance and completely subject to our ever-changing emotions.  How we gather our perception of confidence or fear in an economy broadly dictates how we spend or save our dollars –although, as the cost of living rises, there are limitations to every budget.

But for the housing market, at the very floor of sickness, lies the fear a far more serious diagnosis could be at play.  It may not be the long-awaited Armageddon bubble pop, however over the past two to three years many vendors have experienced a slow deflating puncture of lost equity as the weakness in home loan data and lower rates of turnover continue.

Even with previous and prospected interest rate drops there’s been little to motivate an uplift of market movement, and it’s clearly going to take more than a monetary stimulus to produce lasting recovery.

The problem reflects a game of stalemate – consumers have a need to purchase real estate but no desire to spend big in an arena of slowly deflating equity. 

Unlike other industries, where price drops can attract a flurry of spending, Australians have been somewhat brainwashed by a decade-long credit-inflated property boom. Consequently, residential real estate is broadly considered a vehicle for investment over and above its basic value as a place of shelter.

It’s therefore highly debateable whether further drops in median values would motivate purchasers to perceive a bargain and get out their credit cards as they would for a local retail sale.  Furthermore, because the selling price is set with a large dose of emotion, it’s harder to recognise if a drop in price represents a true bargain.

As a general point, the last thing owner-occupiers will let drop in times of uncertainty are the mortgage re-payments.  The perception of security home owners gain from their principal place of residence is a tonic in turbulent times. 

Not only this, but the home is an extension of the occupant’s life – a place of precious memories and personal passions that dictate why we often see vendors withdraw from the market rather than sell for a price they don’t consider worthy.

The owner-occupier market (which forms the largest market in Australia) splits the real estate landscape between the need to sell owners and those who’ll only budge if they can get their pre-conceived price.  This is the price they have formulated based on invested emotions and one that often bears little relation to the dictates of today’s property shoppers.
 
<hr class="system-pagebreak">
 
Although we’ve seen an uplift in forced sales on the vendor’s side – and affordability issues on the purchaser’s side – the vast majority of purchasers and vendors are not willing to meet midway (hence low rates of turnover) - and with nothing on the horizon to suggest Australia’s economy is on the precipice of financial disaster or conversely about to flourish into another boom of growth, I’m afraid we could be looking at a long period of property market stalemate, which won’t be broken by the cliché of spring headlines, interest rate cuts, or mortgage lending sweeteners.

Vendor expectation is such a fundamental part of any acquisition process; it deserves a lot more attention than simply stating that vendors currently have “unrealistic” ideals.  “Vendor education” – the commonly used term by realtors who are charged with breaking high ideals in order to achieve a sale – is a fine-tuned art that splits those who are experienced in the industry from those who still have “stars in their eyes” of easily earned commissions.

The barriers dissuading vendors from taking a monetary loss are not clear cut and form a game of behavioural economics.   Broken down you could term it the “endowment effect” – the differentiation between  what a person is willing to accept compared with a what an individual is prepared to pay.

It was the American economist Richard Thaler who first made inroads into our irrational emotions and their concurrent effect on economic data – an effect that often hinders analysts from making predictable assumptions.

He aptly demonstrated how we place a higher value on emotional objects we own compared with the price we’d be willing to pay for a replica offered for sale.  In the 1990s, he demonstrated his theory with a famous social experiment involving coffee cups.

A group of students were divided into two. One half were handed mugs while the other were given dollars.  The two groups were then asked to separately devise both an asking price and a selling price.

The sellers valued their mugs at $5.25, while the buyers were only willing to pay $2.25 to$2.75.  Even though it was assessed that the sellers would not consider paying their own inflated prices should the shoe be on the other foot, they were unwilling to drop the mug price below their preconceived notion of value.

A different experiment was derived to see if the effect carried over into non emotional items – items for which a value has already been pre-determined.

One set of students were given a token and each student assigned a mythical sell value. The other half were given money and each assigned a fictitious buy value.

In line with rational thinking, when token holders were offered more than the pre-consigned value, they agreed to sell.  Equally, when the buyers were offered a “deal” less than their pre assumed value, they purchased.  It was a perfect example of basic buy/sell economics.
 
<hr class="system-pagebreak">
 
The difference between the two experiments comes down to the value we place on property and possessions – or in the context of this article – real estate.  We have a tendency to be truly irrational about our homes when it comes to placing monitory value on the holding.  An irrationality that has no place in basic economics, yet affects a market that in Australia is worth an estimated $4 trillion.

To emphasise the point, I was recently in discussion with a developer who wanted to offer a home owner two and a half times the value of their block to induce a sale.  The developer naturally saw the deal as a win-win for both parties.

The home/land owner would receive a windfall, enabling them to upgrade from their principal place of residence and move no more than a stone’s throw away if desired.

The developer, on the other hand, would reap the benefit of acquiring a piece of land, which was strategically located to enable his personal commercial endeavours to profit over the long term. For the developer, the inflated price he was offering was a worthy investment.

The developer naturally felt a valuation and market appraisal of the block would be enough to form the basis for a calculation of appropriate compensation.  What he hadn’t factored in however, was “endowment effect”.

Despite all available evidence proving the home owners would reap over half a million tax-free profit on top of comparable market value if they accepted the developer’s offer, they still considered the figure unworthy of the personal emotional commitment they had invested in their home.

It may seem crazy to those reading, however it’s a very real example of our irrational relationship with property.

If a deal such as the one above can’t achieve success in a highly deflated buyers’ market, you can clearly comprehend why Australia’s property market is not moving at a more microscopic level. In other words, forget about analysing a “property clock” – because it’s simply not ticking!

Whether purchasers have the dollars or not, they’re not likely to profit from the downturn until vendors are forced to change – and with nothing forcing vendors to change, we’ve got a long chess game ahead before someone knocks over the queen.

With this in mind, current conditions favour the investor who can hang out for that nugget of gold while at the same time identifying the property owners who – for personal reasons – have little choice but to reduce expectation.

Home buyers or existing owner-occupiers, however, face the challenge of finding a suitable home in a sea of advertised listings, few of which tick their “ideals” with a price tag to match.

Keen negotiation skills are the key to shifting the current game of checkmate – however, this can’t be achieved without ample on-the-ground due diligence, patience, and legwork. Unless a buyer is prepared to leave their emotions at the front door prior to entering into negotiation, they may find the current well termed buyers’ market frustratingly difficult.

Catherine Cashmore is a market analyst with extensive experience in all aspects relating to property acquisition.
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Australian property market could be in for a long-term stalemate

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Australians are among the most enthusiastic online shoppers in the world.
Our most recent survey, published in the CCi Digital Futures report, <a rel="nofollow" href="https://apo.org.au/research/cci-digital-futures-2012-internet-australia">The Internet in Australia 2012</a>, has found a quarter of Australian internet users make weekly purchases online, compared to 18% in the UK and only 12% in New Zealand.
And it is rapidly growing. Surveys we have conducted in 2007, 2009 and 2011 showed growth in all commercial activities we asked about. (Although, interestingly for the debate in Australia, we saw stronger growth between 2007 and 2009 than for 2009 to 2011.)
And while activity is growing among those who are online, the online Australian population is also continuing to grow.
In 2007, 73% of Australians used the internet; by 2009 this figure had grown to 81%, and it grew again to 87% in 2011. There are more Australians online, buying more often.
But amidst these figures, reporting has concentrated on flat “official” retail figures, high profile retail collapses and the “threat” of online retail.
Poor pre-Christmas sales in 2010 prompted big retailers including Harvey Norman and Myer to press the federal government to apply GST to goods bought online worth less than $1,000.
But this reaction gave the impression they had only just heard of the internet.
While perfectly justified, their complaint that the GST-free threshold on goods bought by Australians from overseas sites made for an uneven playing field, was a little beside the point.
Australians were not going online just to save 10%. A <a rel="nofollow" href="https://www.smh.com.au/national/online-tax-no-silver-bullet-say-retailers-20120908-25lex">public campaign</a> to increase the costs of goods bought online was never going to strike a popular chord.
So why have Australia’s large bricks and mortar retailers been slow to respond to the challenge of the internet? If the conventional rule is “once bitten, twice shy”, the response to the tech-wreck of the early 2000s suggests that for Australian retailers, the multiplier is greater than the customary two. Cheaper prices and greater variety has led Australians to purchase overseas.
Australian retailers are not the only, or even the greatest, villains in the story. The high Australian dollar, the popularity of overseas travel, and the emergence of transnational online stores like iTunes, has highlighted how Australia is priced differently by many overseas firms.
Australia is seen by many as a “high-margin market”, which seems to be code for “a land of sweeping returns”. The number of parallel importing cases before the courts is an interesting by-product of this dynamic.
Yet news is far from gloomy for Australian retailers. Australians are keen to shop with Australian websites. Around half of Australian consumers who shop online make most or all of their purchases with Australian sites.
<hr>
Reasons include the belief it is less risky for consumers, as returning products should be simpler and cheaper and that enforcing consumer rights is possible.
In addition, two major shifts in online retail have major potential upside for domestic retailers.
The first is a shift to purchasing that is more time sensitive. Up until now, online shopping seems to have been driven largely by the chance to save money and acquire goods that are hard to find locally.
The next phase is likely to be about convenience; making online purchasing easier than visiting the store. This requires distribution networks that can achieve next day or same day delivery. Large Australian retailers already have distribution networks that should give them a solid platform to compete on this basis.
In the United States, there has been a long debate — somewhat like our GST debate — about the application of state-levied sales taxes on online purchases. (Somewhat surprisingly, the Victorian state government joined the tax-free threshold debate recently.)
It’s interesting that some US online retailers now appear to be trading off their out-of-state tax-free transactions against the ability to deliver more quickly, through greater physical proximity to their customers.
The second is the rise of the mobile internet, and its promise of nearly ubiquitous, always-on connectivity. Debates about online retailing, like many other internet related debates, have tended to polarise between “the online” and “the offline”.
As the internet has matured it turns out that most of the interesting stuff is about reconfiguring the connections between the offline and online worlds. In a dial-up environment, people “went” online; now they are more likely to be moving between the on-and offline environments; often using the internet to navigate and complement their offline activities.
The attraction of the mobile internet is not only the idea that it is available almost everywhere (in cities, at least). It is increasingly sensitive to place. The result will be lots of new opportunities for communication and commerce for traditional retailers.
The possibilities include helping customers to find stuff, allowing them to search store layouts, to order for in-store pick up, and to use their mobile phones to purchase in-store. The challenge for retailers is how to best integrate these proliferating channels with their businesses.
Many smaller Australian companies and start-ups are showing the way. They will help ensure that local retailing remains competitive in an increasingly dynamic environment.
Scott Ewing is a senior research fellow at the Swinburne Institute for Social Research and at the ARC Centre of Excellence in Creative Industries and Innovation. Julian Thomas is drector of the Swinburne Institute for Social Research, and Professor of Media and Communications at Swinburne University of Technology. This article first appeared on <a rel="nofollow" href="https://theconversation.edu.au/click-here-for-bankruptcy-scamming-and-small-businesses-7084">The Conversation</a>.
 
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How Australian retailers can capitalise on the rise of online shopping

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Japanese fashion brand Uniqlo has confirmed plans to open its first Australian store. Currently there are 903 Uniqlo outlets worldwide.
The company, best known for its multi-coloured micro-fibre wools and cottons clothing, will establish a Melbourne office in December.
Uniqlo spokesperson Aldo Liguori says the company's first store will open in 2013-2014.
“We expect to open one store in Australia during the fiscal year 2013," he says.
"We believe there is strong potential for the Uniqlo brand among consumers in Australia.”
Uniqlo is a subsidiary of Fast Retailing Pty Ltd, a global fashion operation.
The company was founded in 1984 in Japan, where it is listed on the Tokyo Stock Exchange.
Over the years, Uniqlo has moved into the fast fashion market.
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