<p>One of North Sydney's best-known commercial buildings could become hundreds of new homes, with insurance giant Zurich Australia lodging a State Significant Development Application (SSDA) to transform 5 Blue Street into a mixed-use residential development above North Sydney Station.</p>

<p>Rather than demolishing the existing building and starting again, Zurich is proposing an adaptive reuse project that would convert the landmark office building into a 15-level residential development delivering 62 apartments, 86 affordable co-living dwellings, activated retail and significant upgrades to the Blue Street Plaza.</p>

<p>The proposal reflects a growing trend of commercial property owners repositioning ageing office assets into residential housing as Sydney grapples with housing supply shortages and changing workplace demand.</p>

<p><img alt="Zurich" data-entity-type="file" data-entity-uuid="0bba7d12-06dc-4375-aad7-238c94b21ac5" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-22%20at%2010.42.05%E2%80%AFAM.png?VersionId=NJl5oLAEBDGuPmY3RnyliKODjMc8lvRh" /></p>

<p>Located directly above North Sydney Metro and train station, the 3,051 sqm site occupies one of the most strategically positioned parcels of land on Sydney's Lower North Shore.</p>

<p>Designed by fjcstudio, the proposal seeks to retain and adapt much of the existing structure while creating a contemporary residential address that better connects with the public domain surrounding North Sydney Station.</p>

<p>The application proposes two basement levels, ground floor retail, affordable co-living accommodation across the podium levels, and apartments above, while preserving and enhancing the publicly accessible Blue Street Plaza.</p>

<p>Rather than pursuing maximum apartment numbers, Zurich has opted for a housing mix heavily weighted towards larger owner-occupier residences.</p>

<p>The proposal includes 62 build-to-sell apartments comprising 12 one-bedroom, 19 two-bedroom, 29 three-bedroom apartments and two premium penthouses. It also incorporates 86 affordable co-living dwellings, which would be managed in perpetuity by a Community Housing Provider.</p>

<p>That balance between traditional apartments and affordable housing reflects the NSW Government's push to increase housing diversity around major transport infrastructure.</p>

<p>The proposal has been lodged concurrently with a rezoning application, with Zurich arguing the site is ideally positioned to support additional housing given its immediate proximity to public transport, employment and services.</p>

<p>"The proposal aims to respond to the housing challenges facing Sydney through the delivery of diverse housing types in a highly accessible location," the design report by fjcstudio states. It also seeks to improve pedestrian amenity through upgrades to Blue Street Plaza while creating a high-performing residential building that responds to the surrounding context.</p>

<p><img alt="Zurich" data-entity-type="file" data-entity-uuid="36082e15-c636-4481-bb68-5a5f6443fe39" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-22%20at%2010.41.36%E2%80%AFAM.png?VersionId=5P6VD.fvmqjQfIG3TWWMRXxQWiQBjeFB" /></p>

<p>Rather than replacing the commercial building, fjcstudio has developed a design that works with the existing structural framework above the rail corridor, an approach that significantly reduces demolition while allowing the site to be repositioned as a mixed-use residential precinct.</p>

<p>The existing structural constraints have informed much of the building's design, including its relationship with Blue Street and surrounding public spaces.</p>

<p>The building has been designed as a slender tower rising above a clearly defined podium, with vertically expressed façades intended to reduce the perceived bulk while reinforcing North Sydney's emerging skyline.</p>

<p>According to fjcstudio, the architectural language responds directly to the surrounding commercial towers while maintaining a finer grain expression more closely aligned with the neighbouring Lavender Bay streetscape.</p>

<p>The tower incorporates articulated façade elements, landscaped podium edges and recessed upper levels to soften its appearance and improve pedestrian amenity below.</p>

<p>A significant component of the proposal is the revitalisation of Blue Street Plaza.</p>

<p>The existing public space has long served as one of the primary pedestrian connections between North Sydney Station, Greenwood Plaza and Blue Street, yet its role is expected to become even more important following the opening of Sydney Metro.</p>

<p>Zurich's proposal seeks to strengthen that role by improving landscaping, introducing new retail frontages, enhancing pedestrian permeability and creating more active edges throughout the day and evening.</p>

<p>Ground floor retail would wrap the plaza, while separate residential and co-living entries have been designed to improve wayfinding without reducing street activation.</p>

<p>Landscape design has been integrated throughout the podium and public realm, softening what is currently one of the most heavily urbanised parts of North Sydney.</p>

<p>&nbsp;</p>

<p>&nbsp;</p>

<p>fjcstudio has carefully oriented apartments towards Sydney Harbour and the CBD while using privacy blades and articulated façades to minimise overlooking between neighbouring buildings.</p>

<p>Large framed openings along the western elevation maximise harbour outlooks, while the eastern apartments have been angled towards the south-east to improve privacy from neighbouring development.</p>

<p>The project forms part of the continuing transformation of North Sydney from a predominantly commercial CBD into a genuine mixed-use city centre.</p>

<p>Since the completion of Victoria Cross Metro Station, developers have increasingly shifted their attention towards residential projects capable of leveraging the area's unparalleled transport connectivity.</p>

<p>&nbsp;</p>

<p>FiveX recently lodged plans for a 61-storey, 490-apartment tower that would become one of the tallest residential buildings in North Sydney if approved.</p>

<p>Aqualand continues to expand its Lower North Shore presence following the completion of AURA on Walker Street and its recent St Leonards and Roseville proposals.</p>

<p>Developers are also progressing projects throughout Walker Street, Miller Street and the Victoria Cross precinct as demand for well-located owner-occupier apartments continues to strengthen.</p>


Joel Robinson

First look: Zurich targets North Sydney office conversion with 148-unit proposal above Metro station

<p>Busy developer Aqualand Prestige has formally taken the next step in its expansion across Sydney's Lower North Shore, lodging a State Significant Development Application (SSDA) for its long-held Archer Street site in Chatswood.</p>

<p>The application covers <a href="https://www.apartments.com.au/new-apartments/51-55-archer-street-chatswood-nsw-2067">51-55 Archer Street</a>, a 1,767 sqm amalgamated site on the eastern edge of the Chatswood CBD, where the developer is seeking approval for a 45-level mixed-use tower delivering 114 apartments, including a significant affordable housing component, alongside retail, commercial space and six basement levels of parking.</p>

<p>The SSDA marks the latest milestone for a project Aqualand has been quietly progressing over the past two years. The developer first secured the site for its Aqualand Prestige platform before undertaking an alternative design excellence process with PTW Architects, ultimately avoiding a formal design competition through the Housing Delivery Authority pathway.</p>

<p>The proposal has evolved considerably from Aqualand's original concept. The revised scheme has been designed around larger owner-occupier product, with an unusually high proportion of three and four-bedroom apartments, targeting the more affluent buyer profile, and downsizer, emerging across the North Shore.</p>

<p><img alt="Archer St" data-entity-type="file" data-entity-uuid="0171204c-5811-41b5-9b09-2335d1b7c3d0" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-22%20at%208.52.48%E2%80%AFAM.png?VersionId=6YTuxfq.puZo7k2wbfgemcO5K3QfXYGQ" /></p>

<p>The 114-apartment mix comprises six studios, 27 one-bedroom apartments, 18 two-bedroom apartments, 50 three-bedroom residences and 13 four-bedroom homes. A quarter of the building will be dedicated to affordable housing, well above the mandated 15 per cent&nbsp;</p>

<p>PTW has structured the building vertically, with affordable housing across levels one to six, premium apartments through levels seven to 31, duplex skyhomes on klevels 32 to 43, a penthouse on level 44, and a rooftop plant level above. Six basement levels will provide resident parking and servicing.</p>

<p>The tower is proposed to reach approximately 154 metres, placing it among a growing collection of residential high-rises transforming Chatswood's skyline.</p>

<p>Rather than competing purely on height, PTW says the design has been driven by creating a slimmer tower capable of delivering significantly larger apartments.</p>

<p>"The primary objective of this project was to create a distinctive building that stands out from the recently approved or built structures in the Chatswood area," the design report states, noting the structural efficiency allows greater investment into apartment quality and resident amenity.</p>

<p>Residents would have access to more than 450 sqm of communal open space including landscaped gardens, swimming pool, rooftop entertaining areas, fitness spaces, community gardens, children's play areas and barbecue facilities.</p>

<p>A major focus of the design has been the public domain.</p>

<p>The ground plane has been opened up through landscaped terraces inspired by Willoughby's sandstone ridges, with native planting, public seating, artwork, retail activation and a series of gathering spaces intended to soften what has traditionally been a hard commercial streetscape.</p>

<p>The landscape strategy references Blue Gum forests once common throughout the area, while incorporating Indigenous storytelling, public art and lighting installations to strengthen the connection to Country.</p>

<p data-end="239" data-start="66">Chatswood has been one of Sydney's busiest apartment markets over the past 12 months, with a steady pipeline of both new project launches and fresh development applications.</p>

<p data-end="442" data-start="241">Hyecorp recently launched Celine, a 122-apartment development just along Archer Street, while Changfa and Huirong Group are progressing The Anderson, an 84-apartment project on Anderson Street.</p>

<p data-end="661" data-start="444">Develotek recently secured approval for a 101-apartment tower on Pacific Highway, while Tian An LFD received the green light for Hammond Greens, its apartment development on the edge of the Chatswood Bowling Club.</p>

<p data-end="909" data-start="663">Commercial property developer FiveX is also making its move into the residential market. Last month it lodged plans for a 61-storey tower with 490 apartments, which, if approved, would become one of the tallest residential buildings in Chatswood.</p>

<p><em>Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/first-look-fivex-targets-chatswood-skyline-with-61-storey-tower-after-north-sydney-plans">First look: FiveX targets Chatswood skyline with 61-storey tower after North Sydney plans</a></em></p>

<p data-end="1339" data-start="1019">Aqualand is also expanding its development pipeline following the launch of its luxury residential brand, Aqualand Prestige. The developer has delivered a string of high-end apartment projects across Sydney's affluent suburbs over the past decade, most recently AURA by Aqualand on Walker Street in North Sydney.</p>

<p data-end="1339" data-start="1019">[smartcode_project:default project_id=30959 project_image_fid=292863]</p>

<p data-end="1398" data-start="1341">It has since quietly assembled its next wave of projects.</p>

<p data-end="1805" data-start="1400">Earlier this year Aqualand launched Boronia in Roseville, a boutique 111-apartment development on Larkin Street. The project is one of the first significant apartment developments to launch in the suburb ahead of what is expected to become one of Sydney's most active new housing precincts under the NSW Government's Low and Mid-Rise Housing reforms, which allow greater density around train stations.</p>

<p data-end="1805" data-start="1400">[smartcode_project:default project_id=152095 project_image_fid=373685]</p>

<p data-end="1991" data-start="1807">The developer has also lodged plans for a two-tower, 413-apartment development on Herbert Street in nearby St Leonards, further strengthening its presence across the Lower North Shore.</p>

<p data-end="2303" data-is-last-node="" data-is-only-node="" data-start="1993">Beyond that, Aqualand remains behind the final stage of Barangaroo, where plans will deliver a five-hectare mixed-use precinct comprising new homes, retail, hospitality and community facilities, alongside a new Metro entrance and more than two hectares of public open space, completing the Barangaroo precinct.</p>

<p><em>Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/central-barangaroo-development-takes-big-step-with-concept-proposal-approval">Central Barangaroo development takes big step with concept proposal approval</a></em></p>

<p><em>Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/first-look-aqualand-joins-st-leonards-apartment-party">First look: Aqualand joins St Leonards apartment party</a></em><br />
&nbsp;</p>

<p>&nbsp;</p>

<p>&nbsp;</p>

<p>&nbsp;</p>

<p>&nbsp;</p>


First look: Aqualand pushes ahead with Chatswood apartment tower as SSDA lodged for Archer Street

<p data-end="492" data-start="327">Mass timber is becoming an increasingly popular construction material in apartment developments, but Adelaide developer <a href="https://www.apartments.com.au/developers/otello">Otello</a> is taking the approach a step further.</p>

<p data-end="843" data-start="497">At its new <a href="https://www.apartments.com.au/new-apartments/flowe-bowden-18-gibson-street-bowden-sa-5007">Flowe Bowden</a> development, the exposed cross-laminated timber (CLT) structure isn't just about reducing the building's environmental footprint. It also forms the foundation of a broader wellness strategy, influencing everything from indoor air quality and natural materials to the way residents move through and experience the building.</p>

<p data-end="1109" data-start="848">The 115-apartment mixed-use development, designed by Melbourne-based architecture practice Fieldwork, will occupy a prominent island site opposite Bowden Village Reserve, combining one, two and three-bedroom apartments with retail and a dedicated wellness destination.</p>

<p data-end="1109" data-start="848">[smartcode_project:default project_id=152022 project_image_fid=375528]</p>

<p>Wellness isn't confined to a gym or shared resident facility at Flowe. Instead, Fieldwork embedded the concept into the building itself.</p>

<p>The development has been split into two residential wings connected by a naturally ventilated central breezeway, replacing traditional enclosed corridors with open-air walkways that improve natural light, encourage cross ventilation and create more opportunities for neighbourly interaction.</p>

<p>"Rather than treating wellness as something that only happens on the ground floor, our response integrates it throughout the building, which led us to ask what it really means to design a healthy building," Fieldwork Director Quino Holland said.</p>

<p>[smartcode_project:default project_id=152022 project_image_fid=375531]</p>

<p>The building's architecture also reflects Bowden's industrial heritage. The lower podium references the area's historic brick and sandstone buildings, while the upper levels transition to exposed CLT, allowing the timber structure to become a defining feature throughout the apartments and shared spaces.</p>

<p>The use of mass timber sits alongside a range of sustainability initiatives, including a fully electric, gas-free design, rooftop solar and a targeted 5 Star Green Star rating.</p>

<p>[smartcode_project:default project_id=152022 project_image_fid=375524]</p>

<p>Inside the residences, the focus remains on natural, durable materials. Blackbutt engineered timber flooring, exposed CLT ceilings, porcelain surfaces and warm timber joinery create a calming interior palette, while low-VOC finishes and responsibly sourced materials have been selected to improve indoor air quality.</p>

<p>Kitchens have been designed as the centrepiece of each apartment, featuring porcelain island benchtops, timber-look cabinetry and brushed steel tapware, with layouts that maximise natural light and ventilation.</p>

<p>[smartcode_project:default project_id=152022 project_image_fid=375530]</p>

<p>The more traditional interpretation of wellness comes in the form of Level Eleven, a two-storey wellness club spanning the ground floor, mezzanine and first floor.</p>

<p>The facility will include a gym, yoga and reformer Pilates studios, Finnish and infrared saunas, magnesium hot and cold plunge pools, and dedicated recovery spaces. Unlike many residential wellness facilities, Level Eleven will also operate commercially, allowing the broader Bowden community to access the venue while giving residents exclusive membership benefits.</p>

<p>The ground floor has also been designed around everyday living. A café overlooking Bowden Village Reserve will activate the street frontage, while a bike workshop with tool storage, co-working space and dog wash has been incorporated to support daily routines and encourage interaction between residents.</p>

<p>"Flowe brings together my two biggest passions, creating places and creating healthier lives," Otello founder Daniel Harris said.</p>

<p>"We wanted to create something Adelaide hasn't seen before, a genuinely healthy building, where the way you live is lifted without even trying."</p>

<p>Flowe is positioned directly opposite Bowden Village Reserve and within walking distance of Bowden Railway Station and the Adelaide Entertainment Centre, placing future residents just minutes from the Adelaide CBD while remaining connected to one of the city's most established urban renewal precincts.</p>

<p>[smartcode_project_cta:default project_id=152022]</p>


Otello launches wellness-focused Flowe Bowden with Adelaide-first mass timber apartment design

<p>Not all apartment amenities are immediately visible.</p>

<p>Swimming pools, gyms, rooftop terraces and residents' lounges have long featured on buyers' wishlists, but as the way Australians live has changed, so too have the features that make apartment living more convenient.</p>

<p>Increasingly, buyers are placing value on the practical aspects of day-to-day life. Fast internet, EV charging, secure bike storage, flexible workspaces and parcel management are becoming just as relevant as lifestyle amenities, reflecting changing habits and expectations.</p>

<p>Online shopping has been one of the biggest drivers of that shift.</p>

<p>Australians spent a record $82.6 billion shopping online in 2025, with almost one in every four retail dollars now spent digitally, making parcel deliveries a routine part of everyday life rather than an occasional convenience.</p>

<p>For apartment residents, however, receiving those deliveries isn't always straightforward.</p>

<p>Without someone home to accept a parcel, deliveries can be redirected to a nearby Post Office, left in building foyers or common areas, or require building management to temporarily store packages. As apartment living continues to grow across Australia's cities, parcel management has become an increasingly important consideration for both residents and developers.</p>

<p>Australia Post's Parcel Locker network is one response to that shift.</p>

<p><iframe allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" allowfullscreen="" frameborder="0" height="315" referrerpolicy="strict-origin-when-cross-origin" src="https://www.youtube.com/embed/KPZ9j5FRdsQ?si=Qztc1dNP3ZvEIUhb" title="YouTube video player" width="560"></iframe></p>

<p>Rather than relying on home delivery, eligible parcels can be directed to a nominated Parcel Locker, where they're securely stored until collected. Once a parcel arrives, residents receive a notification through the AusPost app or SMS and can retrieve it using a one-time code or QR code at a time that suits them.</p>

<p>The network has expanded to more than 1,500 locations nationwide, with Parcel Lockers positioned at Post Offices, shopping centres, supermarkets, transport hubs and, increasingly, within or alongside residential developments.</p>

<p>That growing presence reflects a broader change in how apartment buildings are being planned.</p>

<p>Developers are increasingly considering the operational side of apartment living alongside traditional lifestyle amenities. Just as secure mailrooms, bicycle storage and EV charging have become more common inclusions, parcel management is emerging as another feature that supports everyday convenience.</p>

<p>It also helps preserve the arrival experience within a building. Carefully designed lobbies and communal spaces can quickly become cluttered when deliveries accumulate, while secure parcel solutions reduce the likelihood of missed deliveries or parcels being left unattended.</p>

<p>For buyers comparing apartments, these everyday details are becoming part of the decision-making process.</p>

<p>Location, floorplans and finishes remain fundamental, but the features that simplify daily life are carrying greater weight than they once did. As online shopping continues to shape consumer behaviour, secure parcel delivery is increasingly becoming another amenity worth looking for.</p>


Parcel delivery is joining the apartment amenity checklist

<p data-end="471" data-start="164">Inca Property Group has lodged a State Significant Development Application (SSDA) for Dawn, a 53-apartment oceanfront development overlooking Mona Vale Beach.</p>

<p data-end="777" data-start="473">The proposal, at 35-39 Darley Street East, would replace an existing 18-apartment strata building with a new owner-occupier-focused development comprising 53 two and three-bedroom apartments, including nine affordable built-to-rent residences delivered under the State's infill affordable housing scheme.</p>

<p data-end="976" data-start="779">Positioned on a 2,679 sqm elevated site around 280 metres from Mona Vale Beach, the development has been designed to maximise panoramic ocean views while responding to the site's sloping topography.</p>

<p data-end="1119" data-start="978"><a href="https://www.apartments.com.au/developers/inca-property-group">Inca Property Group</a> Managing Director Josh Thompson said the State Significant pathway provided greater certainty for projects of this scale.</p>

<p data-end="1399" data-start="1121">"This State Significant pathway gives the team real certainty to progress <a href="https://www.apartments.com.au/new-apartments/dawn-35-39-darley-street-east-mona-vale-nsw-2103">Dawn</a> through to completion," Thompson said.</p>

<p data-end="1399" data-start="1121">"It allows us to acquire a one-off site, design it carefully and deliver the right offering for the suburb, assessed by the NSW Government's planning department."</p>

<p data-end="1605" data-start="1401">The project is one of the first developments in the area to be assessed under the NSW Government's Low and Mid-Rise Housing policy, with the site sitting on the edge of the policy's designated inner area.</p>

<p data-end="1852" data-start="1607">The proposal includes three basement levels providing 124 car spaces, alongside a range of resident amenities including a swimming pool, gym, sauna, wellness facilities and private plunge pools for selected ground-floor and penthouse apartments.</p>

<p data-end="1852" data-start="1607"><img alt="Dawn" data-entity-type="file" data-entity-uuid="fc1a1daf-0ce4-4f12-9076-b1fa553c7a91" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-21%20at%208.42.11%E2%80%AFAM.png?VersionId=4GZ9h.gpNkTljbxyAET8Jfhv51XUamDm" /></p>

<p data-end="2031" data-start="1854">Thompson said Dawn had been designed specifically for owner-occupiers and downsizers, a buyer profile that has driven demand across Inca's recent Upper North Shore developments.</p>

<p data-end="2299" data-start="2033">"The majority of buyers in our recent North Shore projects have been downsizers, and we are learning exactly what this market is looking for. Beyond the location itself, we have included resort-style amenities to deliver a genuine lifestyle offering," Thompson said.</p>

<p data-end="2588" data-start="2301">Located within walking distance of Mona Vale Beach, the town centre, Mona Vale Golf Club and the Royal Motor Yacht Club, Dawn represents Inca's first Northern Beaches project following the sell-out of Tara on Park in Waitara and Ellis Residences, currently under construction in St Ives.</p>

<p data-end="4143" data-start="3991">Construction will be undertaken by Inca's in-house construction arm, GOP Constructions.</p>

<p data-end="593" data-start="417">Dawn is the latest major apartment proposal for Mona Vale, with the suburb emerging as one of the key beneficiaries of the NSW Government's new Low and Mid-Rise Housing policy.</p>

<p data-end="789" data-start="598">New developer One Living, led by industry veteran Joseph Scuderi, recently secured a site on Mona Vale Road, on the border of Mona Vale and Pymble, where it is planning around 140 apartments.</p>

<p data-end="1053" data-start="794">IPM is also planning its third project in Mona Vale, significantly increasing the scale of its previous developments with an 82-apartment proposal at <a href="https://www.apartments.com.au/new-apartments/159-167-darley-street-west-mona-vale-nsw-2103">159-167 Darley Street West</a>, opposite Bayview Golf Course and less than 800 metres from Mona Vale town centre.</p>

<p data-end="4143" data-start="3991"><em>Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/one-living-enters-sydneys-new-apartment-market-with-northern-beaches-site-acquisition">One Living enters Sydney's new apartment market with Northern Beaches site acquisition</a></em></p>

<p data-end="4143" data-start="3991"><em>Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/first-look-ipm-plans-third-mona-vale-project">First look: IPM plans third Mona Vale project</a></em></p>


First look: Inca eyes Mona Vale with State Significant DA for Dawn apartments

<p>Sydney’s property market is known for high prices, competitive bidding, and mounting pressure on first home buyers. But change is on the horizon.</p>

<p>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;</p>

<h2>What is the Help to Buy Scheme?</h2>

<p>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.</p>

<p>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).</p>

<p>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.</p>

<p>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.</p>

<p>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.</p>

<p>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.</p>

<h2>How do you qualify for the&nbsp;Help to Buy Scheme?</h2>

<p>To qualify for the Help to Buy Scheme, applicants must meet the following conditions:</p>

<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>

<p>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.</p>

<p>The scheme is expected to commence in NSW in late 2025, as part of a national rollout.</p>


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

<p>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.</p>

<p>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.</p>

<p>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.</p>

<p>Below, we provide a breakdown of the First Home Owner Grants available across Australia, outlining the specific details for each state and territory.</p>

<h2>New South Wales First Home Owner Grant</h2>

<p><strong data-end="252" data-start="225">First Home Owner Grant:</strong> 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.</p>

<p><strong data-end="413" data-start="389">Stamp Duty Benefits:</strong> Provides full stamp duty exemption for homes valued up to $800,000, with concessions available for properties up to $1 million.</p>

<h2>Victoria South Wales First Home Owner Grant</h2>

<p><strong>First Home Owner Grant:</strong> Provides a $10,000 grant for first-home buyers purchasing or building new homes valued up to $750,000.</p>

<p><strong>Stamp Duty Benefits</strong>: Offers full stamp duty exemption for properties up to $600,000, with concessions available up to $750,000.</p>

<h2>Queensland First Home Owner Grant</h2>

<p><strong data-end="920" data-start="893">First Home Owner Grant:</strong> 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.</p>

<p><strong data-end="1162" data-start="1135">Stamp Duty Concessions:</strong> Provides additional concessions for properties valued up to $800,000.</p>

<h2>Western Australia First Home Owner Grant</h2>

<p>&nbsp;</p>

<p><strong>First Home Owner Grant:</strong> 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.</p>

<p><strong>Stamp Duty Concessions:</strong> Available for homes valued up to $600,000 for transactions entered into on or after 9 May 2024.</p>

<h2>Australian Capital Territory First Home Owner Grant</h2>

<p><strong data-end="1617" data-start="1590">First Home Owner Grant:</strong> Replaced by the Home Buyer Concession Scheme, offering full stamp duty concessions for eligible buyers.</p>

<h2>South Australia First Home Owner Grant</h2>

<p><strong>First Home Owner Grant:</strong> 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.</p>

<p><strong>Stamp Duty Relief:</strong> Available for new homes and vacant land purchases.</p>

<h2>Tasmania First Home Owner Grant</h2>

<p><strong>First Home Owner Grant</strong>: Offers a $10,000 grant for new homes and off the plan purchases.</p>

<p><strong>Stamp Duty Exemption</strong>: 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.</p>

<h2>Northern Territory First Home Owner Grant</h2>

<p><strong>First Home Owner Grant:</strong> The Northern Territory provides a $10,000 grant for new homes only. Additional government grants and concessions are available for first home buyers.</p>

<p><strong>Stamp Duty Exemption</strong>: The only stamp duty exemption available to property buyers is the House and Land Package Exemption (HLPE).</p>

<p><em>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.</em></p>


Every First Home Owner Grant for new property by state

<p>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.</p>

<p>Australia has multiple building rating systems that evaluate energy efficiency and sustainability in existing and new building designs.</p>

<p>Some systems assess individual building components, while others provide an overall rating for the entire structure.</p>

<p>A rating system ensures that homes are comfortable and energy-efficient, whether you are buying, renovating, or building.</p>

<p>NatHERS (Nationwide House Energy Rating Scheme) is a common way for new homes to meet energy efficiency requirements.</p>

<p>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.</p>

<h2>What is NatHERS?</h2>

<p>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;</p>

<p>NatHERS ratings are the most common way new homes meet the National Construction Code's (NCC's) minimum energy efficiency requirements.&nbsp;</p>

<p>NatHERS assessments provide thermal and whole-home ratings for new homes, townhouses, and apartments.</p>

<p>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.</p>

<h2>How NatHERS Ratings Work</h2>

<p>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.</p>

<p>The tools can model complex effects of building mass, insulation, window size, and other elements.</p>

<p>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.</p>

<p>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;</p>

<p>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.</p>

<p>Anyone can use NatHERS tools, but accredited assessors can provide certified ratings and professional advice.</p>

<h2>Benefits of Higher NatHERS Ratings</h2>

<p><strong>Energy Efficiency:</strong> 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.</p>

<p><strong>Cost Savings:</strong> 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.</p>

<p><strong>Environmental Impact:</strong> 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.</p>

<p><strong>Improved Comfort: </strong>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.</p>

<p><strong>Market Value and Desirability:</strong> 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.</p>

<p><strong>Compliance with Building Codes:</strong> 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.</p>


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?

<p>Mixed-use developments have gained significant popularity across Australia in recent years due to their unique blend of residential, commercial, and recreational spaces.</p>

<p>Unlike traditional single-purpose developments, mixed-use projects offer a harmonious integration of various functions within a single locale.</p>

<p>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.</p>

<h3>Convenience and accessibility</h3>

<p>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.</p>

<p>[smartcode_project:default project_id=114215 project_image_fid=204874]</p>

<p>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.</p>

<h3>Vibrant lifestyle and community</h3>

<p>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.</p>

<p>[smartcode_project:default project_id=107714 project_image_fid=214122]</p>

<p>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.</p>

<h3>Potential for higher rental yields and property value appreciation</h3>

<p>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.</p>

<p>[smartcode_project:default project_id=139989 project_image_fid=212887]</p>

<p>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.</p>

<h3>Enhanced security and maintenance</h3>

<p>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.</p>

<p>[smartcode_project:default project_id=108019 project_image_fid=212658]</p>

<p>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.</p>

<h3>Live-work-play balance</h3>

<p>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.</p>

<p>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.</p>


alisonwarters@gmail.com

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

<p style="line-height: 1.38;">When buying a property, everyone needs to be aware of the additional costs that come as part of the buying process.</p>

<p style="line-height: 1.38;">Often the largest outlay, after the deposit which goes to the bank, is stamp duty.</p>

<h2 style="line-height: 1.38;">What is Stamp Duty?</h2>

<p>Stamp duty is an extra tax to pay the government when you buy land, a property, and other certain assets.</p>

<p>It happens when the legal ownership is transferred. It can also be known as property transfer duty or transfer duty.</p>

<p style="line-height: 1.38;"><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></p>

<h2>Who pays Stamp Duty?</h2>

<p>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.</p>

<h2>How much does Stamp Duty cost?</h2>

<p>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.</p>

<p>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!</p>

<p>Overall, the stamp duty you need to pay will depend on:</p>

<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>

<p style="line-height:1.38">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.</p>


Ellen Walker

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

<html><body><div class="page" title="Page 2">
<div class="layoutArea">
<div class="column">
<p><span>GUEST OBSERVER</span></p>
<p><span>Sales activity and price growth in the prime London residential market have both slowed since mid-2014. The EU referendum has been only one of a number of headwinds which have impacted the market. </span></p>
<p><span>The UK election, the threat of a Mansion Tax, the imposition of higher rates of stamp duty as well as the additional rate for investors and second home buyers, have all conspired with the EU vote to dampen market sentiment. </span></p>
<p><span>The very strong volume of sales seen at the end of Q1, bolstered by the impending </span>additional rate of stamp duty, was bound to weigh on deal levels in Q2, but it is fair to speculate that at least part of the decline since April has related to market uncertainty caused by the referendum.</p>
</div>
<div class="column">
<p><span>There is no doubt that the vote in favour of Brexit will generate a period of renewed uncertainty in the prime London residential market. Some demand, especially from investors, will be delayed and in some cases redirected to other markets – although the significance of these trends should not be overstated. </span></p>
<p><span>Demand for prime London property rests on a wide range of drivers – most of which are unaffected by the referendum decision: the scale of London’s business cluster, depth of skills, education, lifestyle and language. It is not easy to identify an obvious alternative destination for investors despite short-term nervousness. </span></p>
<p><span>On the eve of the vote the pound sat 14% below its mid-2014 peak meaning pricing in the prime market was more attractive for dollar buyers. While a further weakening </span>of the pound could increase inward investment, this impact will be constrained by the fact that around 80 percent of central London buyers are UK residents.</p>
<p><span>It seems a reasonable assumption to make that interest rates will be lower for longer, despite the risk of imported inflation from a weaker pound. While the long-term benefit of ultra-low interest rates on the housing market may be questionable, in the short- term they will act to underpin demand especially for equity rich buyers with access to the best funding rates. </span></p>
<div class="page" title="Page 3">
<div class="layoutArea">
<div class="column">
<p><span>The prime country house market will be similarly impacted by the result. However while the market has performed relatively well over recent years, following a slow recovery immediately after the financial crisis, prices have not tracked London to date and there is scope for some out- performance in the short to medium term. </span></p>
<p><span>While we are entering a period of renewed uncertainty in the UK and London market, ongoing issues around EU and especially Eurozone stability, which will be highlighted in the run up to French and German elections, are likely to counter this risk and shore-up London’s safe- haven appeal. </span></p>
</div>
</div>
</div>
<p><span><em>Liam Bailey is partner, Global Head of Research for Knight Frank and can be contacted <a href="https://www.knightfrank.com/research" target="_blank">here</a>.</em></span></p>
</div>
</div>
</div></body></html>

jchancellor-FAypfDUnLy

The factors dampening UK residential market sentiment: Knight Frank's Liam Bailey

<html><body>
<div>It's the end of financial year!</div>
<div> </div>
<div>It was a really strong finish to the year for share markets today, closing up by 1.8 percent. However, the Aussie stock markets finished the financial year down by an underwhelming 4.1 percent.</div>
<div> </div>
<div>With the tax year now having come to an end, it will soon be time to lodge those tax returns.  </div>
<div> </div>
<div><strong><span style="text-decoration: underline;">Holiday homes under scrutiny this year</span></strong></div>
<div><strong><span style="text-decoration: underline;"> </span></strong></div>
<div>Last year, the Australian Taxation Office (ATO) designed and implemented new compliance strategies for foreign investors in Australian property, including stakeholder engagement (with advisers, agents, and associations), improved data matching, and a broad investigation strategy into illegal foreign purchases.</div>
<div> </div>
<div>This year - as well as those claiming excessive work-related expenses such as travel expenses, self-education, uniform, mobile phone, and internet costs – it is resident Australians with rental properties that are more likely to be under scrutiny from the ATO at tax time - in particular those will holiday homes.</div>
<div> </div>
<div>During the past year ATO Commissioners have advised Farifax Media and SBS News that they have been in contact with thousands of owners of rental properties in order to clarify their entitlements or request clarification about claims that they've made. </div>
<div> </div>
<div>The ATO has further reportedly sent correspondence to some holiday home owners recommending that they "review the nature of their claims" before dropping in their next returns...oops!<br><br>
</div>
<div>With well over 2 million Australians lodging tax returns declaring ownership of a rental property - spread widely across all income brackets – the landlord sector is substantial, and there are potentially significant liabilities to be raised by the ATO.</div>
<div> </div>
<div>Click to enlarge</div>
<div><img src="/images/2016/07/01/ATO1.jpg" alt=""></div>
<div> </div>
<div>Owners of holiday homes should take a good deal of care not to make claims for net rental losses for periods when their property has not actually been made available for rent. </div>
<div> </div>
<div>In particular owners of holiday homes claiming deductions for a full year when the property has been vacant for long periods might expect to get a tap on the shoulder from the tax office.</div>
<div> </div>
<div>According to ATO legislation the principles that apply to a rental property also apply to a holiday home if it is rented out - if you rent out your holiday home, you can claim expenses for the property based on the proportion of the income year it was rented out or was genuinely available for rent.</div>
<div> </div>
<div>However, if a holiday home is advertised in ways that limit its exposure to potential tenants, then the property may not be deemed “genuinely available” for rent – for example, if the property is not widely advertised, or if the advertised rents are set at unrealistically high levels.</div>
<div> </div>
<div>Since the ATO’s interest was flagged some months ago, net rental losses declared or claimed on holiday homes could be lower this year as this loophole is sewn up...</div>
<div> </div>
<div><strong><span style="text-decoration: underline;"><em>Airbnb </em>and online networks</span></strong></div>
<div> </div>
<div>There may also be some confusion relating to the rise of online networks such as <em>Airbnb</em>, with more Australians than ever before choosing to rent out their own homes, or a part of their homes. </div>
<div> </div>
<div>Remember, rental income is assessable and therefore you may have tax to pay at year end - don't try to be sneaky and under-report rental income it or you may be penalised! </div>
<div> </div>
<div>For <em>Airbnb</em> hosts there are two types of allowable deductions. Firstly, there are costs directly associated with generating rental income or with the rental area (for eaxample, photography, commercial cleaning costs, food for tenants, <em>Airbnb</em> fees and commissions, or food made available to tenants). </div>
<div> </div>
<div>And secondly there are costs which may be apportioned, often based upon the applicable floor area, including your mortgage or rent, utilities, internet and phone costs, insurance, and so on.</div>
<div> </div>
<div>Keep records and receipts through the financial year and make sure you set aside some money for the tax liability!</div>
<div> </div>
<div>Also, be aware of the potential legal and liability risks or short term tenancies and other tax implications thereof, such as capital gains tax (the principal place of residence is normally exempt, but generating rental income from the home may trigger a change in this status).  </div>
<div> </div>
<div><strong><span style="text-decoration: underline;">Repairs and maintenance</span></strong></div>
<div><strong><span style="text-decoration: underline;"> </span></strong></div>
<div>There is also often genuine confusion for some property investors over what deductions can be claimed.</div>
<div> </div>
<div>Perhaps the most common mistake made by landlords on lodged tax returns is claiming deductions for repairs and maintenance for expenses which are actually capital costs. </div>
<div> </div>
<div>Property investors are not allowed to claim repairs and maintenance deductions for defects or pre-existing damage that was in evidence at the time they acquired the property. Such improvements are considered to be capital in nature.</div>
<div> </div>
<div>Where investors are unsure they would be well advised to check the rules relating to deductions made available by the ATO for free online, or to engage a tax agent or property specialist tax accountant that is familiar with the rules. </div>
<div> </div>
<div><strong><span style="text-decoration: underline;">Net rental losses declining</span></strong></div>
<div><strong><span style="text-decoration: underline;"> </span></strong></div>
<div>Declared net rental losses have declined sharply in recent times, falling by more than half over the last two tax years for which data is available, largely due to lower interest rates. </div>
<div> </div>
<div>The average net loss claimed by investors has fallen by 64 per cent since 2008 as mortgage repayments have become cheaper. These figures will continue to decline in 2015 and 2016 with interest rates having fallen.</div>
<div> </div>
<div><a href="/images/2016/07/01/NG.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/07/01/NG.jpg" alt=""></div>
<div> </div>
<div>While the ATO will doubtless generally be looking for expenses claimed in error as part of their investigative reviews or audits, it is worth noting that many investors also fail to claim deductions which they are entitled to. </div>
<div> </div>
<div><a href="/images/2016/07/01/NG2.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/07/01/NG2.jpg" alt=""></div>
<div> </div>
<div>In particular, not all owners of rental properties are aware of the potentially generous capital allowances and tax depreciation deductions for plant and equipment which are available under the tax legislation.</div>
<div> </div>
<div>If you are in doubt, a property specialist tax accountant can help you to avoid making costly mistakes!</div>
<div> </div>
<div>
<p><span><em>PETE WARGENT is the co-founder of <a href="https://allenwargent.com/" target="_blank" rel="nofollow">AllenWargent</a> property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank" rel="nofollow">blogger</a>.</em><br></span></p>
<p><em>His latest book is <a href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx" target="_blank" rel="nofollow">Four Green Houses and a Red Hotel</a>.</em></p>
</div>
</body></html>

pwargent-M4siyDbqQY

Tips and traps for property investors: Pete Wargent

<html><body>
<p>Real estate website onthehouse has compiled a list of Canberra's most affordable suburbs, with Hughes, Curtain and Downer making up the top three affordable suburbs.</p>
<p>The comparison table, below, features median values, capital growth and rental yield.</p>
<p> </p>
<p>Suburb Postcode Dwelling Region Median Value Capital Growth Last 12 Months Rental Yield Median Rent</p>
<p><strong>Hughes</strong> 2605 Units Metro $280,000 9.79% 5.74% $310</p>
<p><strong>Curtin</strong> 2605 Units Metro $292,000 -2.98% 5.49% $305</p>
<p><strong>Downer</strong> 2602 Units Metro $302,500 4.91% 5.52% $320</p>
<p><strong>Lyons</strong> 2606 Units Metro $303,500 4.13% 5.48% $320</p>
<p><strong>Crace</strong> 2911 Units Metro $320,500 5.12% 5.72% $350</p>
<p><strong>Fisher</strong> 2611 Units Metro $337,500 -3.18% 5.02% $325</p>
<p><strong>Theodore</strong> 2905 Units Metro $339,500 -4.28% 5.49% $355</p>
<p><strong>Macgregor</strong> 2615 Units Metro $340,500 -1.06% 5.57% $365</p>
<p><strong>Franklin</strong> 2913 Units Metro $344,000 2.51% 5.49% $360</p>
<p><strong>Ngunnawal</strong> 2913 Units Metro $344,000 -2.28% 5.44% $360</p>
<p><strong>Holt</strong> 2615 Units Metro $347,500 4.87% 5.50% $365</p>
<p><strong>Gordon</strong> 2906 Units Metro $349,000 -3.93% 5.34% $355</p>
<p><strong>Phillip</strong> 2606 Units Metro $350,000 -0.54% 5.35% $360</p>
<p><strong>Palmerston</strong> 2913 Units Metro $352,000 -2.64% 5.46% $370</p>
<p><strong>Melba</strong> 2615 Units Metro $354,500 -1.40% 5.82% $395</p>
<p><strong>Calwell</strong> 2905 Units Metro $357,000 -2.48% 5.41% $370</p>
<p><strong>Isabella Plains</strong> 2905 Units Metro $362,000 -3.75% 5.28% $365</p>
<p><strong>Kambah</strong> 2902 Units Metro $362,000 -0.11% 5.25% $365</p>
<p><strong>Belconnen</strong> 2617 Units Metro $362,500 0.61% 5.26% $365</p>
<p><strong>Watson</strong> 2602 Units Metro $369,000 1.95% 5.28% $375</p>
<p><strong>Casey</strong> 2913 Units Metro $371,500 4.50% 5.47% $390</p>
<p><strong>Harrison</strong> 2914 Units Metro $371,500 0.77% 5.12% $365</p>
<p><strong>Conder</strong> 2906 Units Metro $373,000 -0.28% 5.22% $375</p>
<p><strong>Wanniassa</strong> 2903 Units Metro $373,500 1.67% 4.98% $355</p>
<p><strong>Page</strong> 2614 Units Metro $385,000 1.73% 5.14% $380</p>
<p><strong>Macquarie</strong> 2614 Units Metro $386,500 1.64% 5.10% $380</p>
<p><strong>Hackett</strong> 2602 Units Metro $388,000 4.42% 4.81% $355  </p>
</body></html>

Canberra's most affordable suburbs: Onthehouse

<html><body>
<p>A comparison guide to the Sydney suburb of Botany and the Brisbane suburb of Milton has been released by iBuyNew comparing the average starting price of a one bedroom apartment.</p>
<p><span>The guide, below, also compares rental yield, annual growth and travel times into the CBD.</span></p>
<p><a href="/images/2016/06/29/INFO_SYDVSBRIS_V02.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/06/29/INFO_SYDVSBRIS_V02.jpg" alt=""></p>
<p>For more information, <a href="https://www.ibuynew.com.au" target="_blank">click here</a>.</p>
</body></html>

jonathanchancellor-7SQnKwU6yx

Comparison guide between Sydney's Botany and Brisbane's Milton

<html><body>
<p>Quarterly growth in the value of Sydney’s median house was a modest 0.03 percent for April, off the back of losses in the March quarter according to Residex.</p>

<p>Residex state Sydney has a stagnant median house value of just over $1,040,000, where it has been hovering around since January, however units in the Sydney market increased a significant 1.26 percent over the April quarter, following losses in January. The median Sydney unit is now at a historic high of $695,000.</p>

<p>According to Residex the Melbourne market experienced more significant easing in the April quarter, with the median house and median unit value dropping by approximately $5,000 and $3,000 respectively. </p>

<p>Table 1 presents the statistics summary for April.</p>

<p> </p>

<p><a href="http:/www.propertyobserver.com.au/images/2016/06/30/Table_1.jpg" target="_blank">Click to enlarge</a></p>

<p><img alt="" src="/images/2016/06/30/Table_1.jpg"></p>

<p><em><span>Source: Residex</span></em></p>

<p> </p>
</body></html>

Sydney's median house value growth modest: Residex

<html><body>
<p style="text-align: left;" align="center"><span>In our Purchase or Pass segment this week we are joined by Anthony Bell from Bell Partners, Nathan O'Brien from Century 21 and Tom Panos from News Corp </span>we take a look at an investment property based that’s recently been on the market and we discuss the pros and cons and whether we would buy it personally.</p>
<p><strong>Location: 8.2kms from CBD</strong></p>
<p><strong>Beds: 2</strong></p>
<p><strong>Bath: 1</strong></p>
<p><strong>Parking: 1 (2)</strong></p>
<p><strong>SQM: 90m</strong></p>
<p><strong>Price: $1.411m</strong></p>
<p><strong>Rent: $1,000-1,100/wk</strong> </p>
<p><img src="/images/2016/06/30/Screen%20Shot%202016-06-30%20at%202.01.51%20PM.png" alt=""></p>
<p>It’s a <a href="https://www.propertyobserver.com.au/https://www.mcgrath.com.au/buy/apartment/nsw/eastern-suburbs/coogee/299216" target="_blank">2 bed, 1 bath unit with lock up garage</a>, 8.4kms from the CBD and just 130m to put your toes on the sand of the local beach. It’s in a very small, boutique Art Deco, security block of 6 units, with no lifts, gyms or pools. There’s 2 large double bedrooms, a deluxe gallery kitchen and a designer bathroom with separate shower and bath. Whilst it is not on title and hasn’t been advertised as such, it is possible to park a second car outside your garage.</p>
<p>Chris: So, talking to you Nathan, what are your initial thoughts on it?</p>
<p>Nathan: Generally speaking Chris, I think it looks to be a well maintained property. It is looking a little bit old, but I think it presents well. </p>
<p>Chris: Yep, sounds good. Now, Antony, it’s probably good for an estate agent to be honest and to not have advertised it as two spaces when it’s only one</p>
<p>Antony: Yeah, I think if you’re getting it for free, you know, it’s an excellent proposition, but if you’re paying for it I’d be obviously checking the contract and checking what the real rights to that property actually are. Look, I think that property ticks a lot of the boxes, I wouldn’t say all of them, the age of the building (that) was just mentioned is a very poignant piece to take into control and so the body corporate and where that’s all up to, to me, would be high on the examination list.</p>
<p>Chris: Look, that’s probably one of the things, having a small block. People say ‘why should I have a small block rather than 100 people in there?’ If you’ve got six people to convince, I’m sure you guys get to deal with these strata issues, how easy is it to deal with the six people to make a decision versus the 100?</p>
<p>Nathan: Absolutely, it’s a lot easier when there are less people involved, however, I think at the same time, I think overall just coming back to your questions, it’s an appealing block, but I think also that can be a bit of a challenge at times with strata costs as well. So, you’ve got to weight up the pros and cons.</p>
<p>Chris: And also give them the right kinds of things for the suburbs, because some people love the lifts, gyms and pools, but it could be argued, well, if the beach is around your doorstep why do you need all that kind of stuff.</p>
<p>Antony: I think that’s important, I do like units that have outdoor space attached to them, meaning a balcony, or some opportunity to… actually just while you’re inside your living space you get a shot at just walking out… but it’s still ticking all the boxes.</p>
<p>Chris: Again with the second parking, whether you’ve got it on title or not… if you can use it, how many renters and owners die for something like that?</p>
<p>Antony: Look, on a beachside place you can only imagine parking on a Sat or Sunday is going to be an absolute difficult thing to pull. So, if it’s through the body corporate records, it’s not on title but it’s actually awarded to the owner of the strata, then I’m a like for it and I think that becomes a really important part of the second spot in today’s sort of living- very rarely do you have a family of one car and it gives you the opportunity of bringing other tenants in or share apartments and that will push the rent up.</p>
<p>Chris: I mentioned that the agent, we don’t mention which agents are selling these properties or the addresses or anything, but this agent, he’s done the right thing, he’s advertising it as one rather than two. I guess from your perspective being an estate manager, there must be a lot of pressure on agents now, you’ve got to do the right thing and you’ve got to advertise legally what it is.</p>
<p>Nathan: Absolutely, you’ve got to not misrepresent the property in any way shape or form but the fact that you’ve got the space there for a second car, it’s a huge selling point. Especially for when you’re looking for the right tenant, you really want to maximise your rent there. It’s definitely a great value add to that property.</p>
<p>Chris: Again, probably going back to the clearance rates our conversation right at the start of the show, these kind of things are so unique the clearance rates on those are nearly 100 percent no matter what the market, aren’t they?</p>
<p>Antony: Yeah, hot demand on both sides Chris. Hot demand on clearance rates, which means that there would always be an upward pressure on pricing.</p>
<p>If you’re an investor and survive the negative gearing onslaught … if you lose a tenant, your speed to acquiring a new tenant is going to be very very fast in areas like that so your days off market, rent wise, are going to be very very few.</p>
<p>Chris: Purchase or pass for you</p>
<p>Antony: I would buy</p>
<p>Chris: and how about yourself</p>
<p>Nathan: Yeah, same with me, purchase </p>
<p>Chris: I think this is a cracking unit if you’ve got the funds to buy it as it really does tick every single box. The rent in winter in a more expensive property might drop down below 4 per cent at times but I think the capital growth will more than compensate so I would buy.</p>
<p>To watch the episode in full, <a href="https://www.youtube.com/watch?v=0VvouEoiSw4" target="_blank">click here</a>.</p>
<p> </p>
</body></html>

Chris Gray's Purchase or Pass: To buy or not to buy

<html><body>
<div>GUEST OBSERVER </div>
<div>
<p>There is no doubt that the vote in favour of Brexit will generate a period of renewed uncertainty, but mainly in the UK and Europe. Some demand, especially from investors and businesses (hiring and investing), will be delayed and in some cases redirected to other markets.</p>
<p>Demand for Australian property may actually benefit (as a safe haven) as globalinvestors pause in directing capital into Europe and our demand rests on a wide range of drivers – most of which are unaffected by the referendum decision: the scale of Australia’s business clusters, depth of skills, education, lifestyle and language etc. </p>
<p>However it must be said that the world is entering a period of renewed uncertainty inthe UK and London market, and ongoing issues around EU and especially Eurozone stability, which will be highlighted in the run up to French and German elections. Uncertainty and instability is bad for financial markets and capital investment, so let’s see what impact it may have on borrowing costs and business/consumer confidence here in Australia. </p>
<p>The UK has long been a destination for Asian (Chinese mainly) real estate investors, with the attraction of the strong liquidity, stable governance, transparency and clear title. With the decision to exit the European Union, for existing Asian property owners, the fall in the pound will impact the repatriation of any income returns, as well as the gains on any disposal.</p>
<p>Although there is likely to be more volatility in the market, ultimately most investors are looking to the long term – so will continue to hold their assets, in the hope that any short-term instability will eventually subside when more clarity of the UK’s role in Europe is determined.</p>
<p>The decision, however, could also present a buying opportunity for owners not already set, as the significant drop in the value of the pound, as in 2009, could lead to an uptick of interest by Asian investors, who, over the last few months have adopted a wait-and-see approach to the referendum – and will now see their buying power increase significantly.</p>
<p>As stated above, Chinese, Singaporean and Hong Kong investors especially, looking at both residential and commercial properties, could also start to look even harder at markets like Australia over the remainder of 2016 until the dust settles in UK/Europe.</p>
<p>Regarding interest rates, an interest rate cut of 25 basis points is a strong possibility at the UK Monetary Policy Committee’s July meeting, or perhaps earlier if required. We may also see a return of quantitative easing, if there are signs that investment is deteriorating. I think the RBA is now even more likely of cutting rates, either in July or more likely in August once the inflation number comes through.</p>
<p>Uncertainty for businesses is the biggest threat to Australia in a very global world. It is therefore inevitable that business behaviour will be stifled over the short-term and delays in occupier decision making will persist. </p>
<p>Despite this, over the medium-term there are reasons to be positive. First, the pessimistic scenarios highlighted during politicised campaigns often fail to emerge. Second, as the dust settles, and the UK and global economy stabilises, businesses will reconnect with the fundamental qualities of Australia as a business location; ranging from corporate tax rates, to the large consumer market, to the highly skilled worker base, to the lifestyle.</p>
<p><em>Matt Whitby is Head of Research &amp; Consulting, Australia, Knight Frank and can be contacted <a href="https://www.knightfrank.com.au" target="_blank">here</a>.</em></p>
</div>
</body></html>

Potential impact of Brexit in Australia: Knight Frank's Matt Whitby

<html><body>
<p>GUEST OBSERVER</p>
<p>We are about to enter a period of substantial reform.</p>
<p>We have therefore prepared a brief ‘stock take’ of what the reform proposals look like as at the start of July 2016. In particular, we consider the proposals announced in the 3 May 2016 Federal Budget by the Liberal Government.</p>
<p>We also briefly compare these with the Labor Government’s proposals. Remember that these proposals are not yet law and the final form they take if they are introduced as law depends on a number of variables.</p>
<h2>
<strong>LIBERAL PARTY PROPOSALS - </strong><strong>CHANGES THAT APPLY FROM 3 MAY 2016</strong>
</h2>
<p>The following change, if enacted, will apply from the date of the Budget announcement, being 7.<span id="0.4639541348442435" class="highlight">30</span>pm on 3 May 2016:</p>
<h2><strong>Lifetime non-concessional contributions cap</strong></h2>
<p>A lifetime non-concessional contributions (‘NCC’) cap of $500,000 will apply. This lifetime cap will take into account all NCCs made on or after 1 July 2007. Contributions made before the Budget announcement, however, will not result in excess NCCs.</p>
<p>The most difficult aspect of the Liberal Party’s superannuation reform proposals is the practical retroactive application the lifetime cap by including almost 9 years (ie, 1 July 2007 to 3 May 2016 is around 3,230 days or just over 8.8 years).</p>
<p>Thus, people who have previously relied on the law during this 9 year period in making contributions to their superannuation funds may now have no or little lifetime NCC cap remaining. Despite this practical impact, the Liberal Party is firm (and correct) in its view that this proposal is not retrospective (from a strict legal perspective).</p>
<p>The Liberal Party takes the view that the lifetime cap is prospective as it only affects excess NCCs made after the Budget announcement. That is, if more than $500,000 was contributed prior to 3 May 2016, that amount is not required to be withdrawn from superannuation.</p>
<p>However, if someone who has contributed more than $500,000 after 3 May 2016 (including contributions made prior to that date), the excess must be removed from superannuation or will be subject to penalty tax. A special ATO release authority will issue allowing the removal of the excess.</p>
<p>The Liberal Party has stated that there may be transitional provisions implemented for superannuation trustees who entered into contractual arrangements prior to the Budget announcement and who intended to make additional NCCs to settle the contract.</p>
<p>The proposed lifetime NCC cap will replace the existing NCC caps of $180,000 each financial year (or $540,000 averaged over three years under the bring-forward provisions). The $500,000 NCC cap will be indexed to average weekly ordinary time earnings (‘AWOTE’). Further, this proposal does not alter contributions made to superannuation under the CGT cap.</p>
<p>For more information on the <span lang="X-NONE">$500</span>,000<span lang="X-NONE"> lifetime NCC cap</span>,<span lang="X-NONE"> <a href="https://www.dbalawyers.com.au/announcements/new-500000-lifetime-contribution-cap-retrospective-bad-law/" target="_blank">click here</a>.</span></p>
<h2><strong>CHANGES THAT APPLY FROM 1 JULY 2017</strong></h2>
<h2><strong>Retirement transfer balance cap </strong></h2>
<p>A balance cap of $1.6 million on the total amount of accumulated superannuation a member can transfer into the tax-free retirement phase will be introduced. </p>
<p>Currently, the earnings on assets supporting the trustee’s liability to pay a pension to a member are tax free without any maximum limit; this is known as the exempt current pension income (‘ECPI’) exemption. This proposed measure caps the ECPI of each member at $1.6 million of capital that can be used to commence a pension.</p>
<p>There will, however, be no restrictions placed on the subsequent earnings on the balance cap of $1.6 million. Therefore, the tax free status of the earnings derived from assets supporting a pension will not be limited.</p>
<p>Amounts in excess of the balance cap can be maintained in accumulation phase. Generally, earnings during the accumulation phase are taxed at 15%, with a 10% applying to net capital gains on assets held for more than 12 months after allowing for the 1/3rd CGT discount. </p>
<p>Members already in the retirement phase with balances above $1.6 million will be required to reduce their pension account balance to $1.6 million by 1 July 2017.</p>
<p>A tax on amounts that are transferred in excess of the $1.6 million cap (including earnings on these excess transferred amounts) will be applied, similar to the tax treatment that applies to excess NCCs. </p>
<p>Excess amounts will need to be transferred to accumulation phase or withdrawn, and tax paid on the associated earnings after allowing a 15 percent tax offset. </p>
<p>The balance cap remaining for a member seeking to commence more than one pension will be determined by apportionment. Broadly, this means that if a member only uses part of their balance cap, they can utilise the remaining balance cap and if the cap has been indexed, they obtain a proportionate increase to their remaining cap.</p>
<p>The $1.6 million balance cap will be indexed in $100,000 increments in line with CPI.</p>
<p>For more information on the <span lang="X-NONE">$1.6</span> million<span lang="X-NONE"> balance cap</span>, <a href="https://www.dbalawyers.com.au/announcements/1-6m-balance-cap-examined-tax-death-benefits/" target="_blank">click here</a>.</p>
<h2><strong>Division 293 threshold</strong></h2>
<p>The threshold at which high income earners pay additional contributions tax will be lowered from $<span id="0.9514911156147718" class="highlight">30</span>0,000 to $250,000 from 1 July 2017.</p>
<p><strong style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">Annual concessional contributions cap will be reduced to $25,000</strong></p>
<p>The annual concessional contributions (‘CC’) cap will be reduced to $25,000 each financial year (indexed in line with AWOTE).</p>
<h2><strong>Rolling 5 year concessional contribution cap</strong></h2>
<p>Members with a superannuation balance of less than $500,000 will be permitted to make additional CCs where they have not reached their CCs cap in the prior five FYs. This will effectively equate to a rolling five year average CC cap of up to $125,000. </p>
<p>For example, if a member contributes $10,000 in FY2018, the member will effectively have a CC cap of $40,000 in FY 2019 (ie, $25,000 plus $15,000). </p>
<h2><strong>Tax deduction for personal superannuation contributions</strong></h2>
<p>All members up to age 75 will be allowed to claim an income tax deduction for personal superannuation contributions up to their CC cap. This effectively allows all individuals, regardless of their employment circumstances, to make CCs up to the CC cap.</p>
<p>For example, if an employer makes superannuation contributions of $10,000 on behalf of an employee, the employee may make an additional $15,000 of personal CCs to superannuation, and claim a deduction for this amount (subject to having sufficient taxable income to offset the deduction).</p>
<p>For more information on personal deductions, <a href="https://www.dbalawyers.com.au/ato/budget-means-right-now-personal-deductible-contributions/" target="_blank">click here</a> </p>
<h2><strong>Abolishing the work test for members under age 75</strong></h2>
<p>The current restrictions on people aged 65 to 74 from making superannuation contributions will be removed. In essence, this means that the work test requirements (ie, gainful employment for 40 hours in <span id="0.12656144774518907" class="highlight">30</span> consecutive days before a contribution can be made) will cease to apply for members under age 75.</p>
<p>For more information on the CC<span lang="X-NONE"> proposals</span>, <a href="https://www.dbalawyers.com.au/announcements/spotlight-concessional-contributions/" target="_blank">click here</a>.</p>
<h2><strong>Low income superannuation tax offset</strong></h2>
<p>A low income superannuation tax offset (LISTO) will be introduced to reduce tax on superannuation contributions for low income earners. Note that this announcement ensures that the Low Income Superannuation Contribution, which has been legislated to cease on <span id="0.6623968072235584" class="highlight">30</span> <span id="0.5895551722496748" class="highlight">June</span> 2017, will effectively continue to operate.</p>
<h2><strong>Spouse tax offset</strong></h2>
<p>The income threshold for the recipient spouse (whether married or de facto) of the low income spouse tax offset will be increased from $10,800 to $37,000. The contributing spouse may be entitled to a maximum tax offset up to $540 for contributions each financial year made on behalf of the recipient spouse.</p>
<h2><strong>Transition to retirement income streams</strong></h2>
<p>The tax exemption on earnings derived from assets supporting transition to retirement income streams (‘TRIS’) will be removed from 1 July 2017. Therefore, members who have reached preservation age, but not yet retired will be able to commence a TRIS (or continue to receive a TRIS), but the earnings will be taxed at the concessional rates that apply to amounts in the accumulation phase.  </p>
<h2><strong>Lump sum election</strong></h2>
<p>It is proposed to remove the provision that allows individuals to treat certain superannuation income stream payments as lump sums for tax purposes under regulation 995-1.03 of the <em>Income Tax Assessment Regulations 1997 </em>(Cth). This measure will primarily affect members under age 60 in receipt of a TRIS. </p>
<h2><strong>Anti-detriment provisions</strong></h2>
<p>The anti-detriment provision in respect of death benefits from superannuation will be removed from 1 July 2017.</p>
<h2><strong>LABOR PARTY PROPOSED SUPERANNUATION CHANGES</strong></h2>
<p>At this stage, the Labor Party has proposed the following two changes to superannuation if it wins the July 2016 election:</p>
<h2><strong>Pension exemption limit of $75,000 p.a.</strong></h2>
<p>If elected, the Labor Party intends to reform the tax exemption for earnings on superannuation balances in pension phase that exceed $1.5 million. From 1 July 2017, future earnings on assets supporting income streams will be tax‑free up to $75,000 a year for each member, while earnings above the $75,000 threshold will be taxed at 15% that applies to earnings in the accumulation phase.</p>
<p>It is proposed, however, that assets acquired prior to 1 July 2017 will be grandfathered for capital gains tax purposes. In respect of future discounted gains (ie, capital gains entitled to the 1/3rd discount), the gain will be added to income earnt in any year and included in the $75,000. </p>
<h2><strong>Division 293 threshold</strong></h2>
<p>The Labor Party also proposes to reduce the Division 293 threshold from $<span id="0.8309205649420619" class="highlight">30</span>0,000 to $250,000.</p>
<h2><strong>Labor Party’s position</strong></h2>
<p>While the Labor Party has stated that it opposes the retrospective effect of certain Liberal Party proposals, Labor has not as yet formally adopted a position with regard to the Liberal Party proposals. </p>
<p>For more information on the <span lang="X-NONE">Liberal </span>Party <span lang="X-NONE">v Labor </span>Party <span lang="X-NONE">pension proposals</span>, <a href="https://www.dbalawyers.com.au/announcements/liberals-v-labor-different-election-outcomes-mean-smsf-pensions/" target="_blank">click here</a>. </p>
<h2><strong>CONCLUSIONS</strong></h2>
<p>The superannuation reforms will have wide ranging impact and are likely to take several years to finalise. Most people will have to adjust their superannuation planning, especially their SMSF succession planning, and are best positioned to do so if they monitor and keep on top of the changes. There are strategies that can be implemented ahead of these proposals becoming law and expert advice should be obtained as needed.</p>
<p>DBA Lawyers will be continually refining its SMSF and related documents to keep at the forefront of this change. We also offer an extensive range of education options to keep you updated on an ongoing basis.</p>
<p><em>Daniel Butler is director, DBA Lawyers and Rebecca James is special counsel. They can be contacted <a href="https://www.dbalawyers.com.au" target="_blank">here</a>. </em></p>
</body></html>

Property 101: Proposed super reform

<html><body>
<p><img src="https://counter.theconversation.edu.au/content/57114/count.gif" alt="The Conversation" width="1" height="1"></p>
<p>GUEST OBSERVER</p>
<p>Value capture secures some of the benefits delivered by public investment to offset the costs of provision. The notion has been around in various forms for a while, but recently gained steam. Prime Minister’s Malcolm Turnbull’s Smart Cities Plan touts value capture as a way to better distribute “the costs and benefits in publicly funded infrastructure to facilitate a project that may not otherwise occur”.</p>
<p>But there’s a lot of confusion about what value capture actually means and how it might operate in Australia.</p>
<h2>What is ‘value capture’?</h2>
<p>Public investment in a new rail line or motorway can generate huge increases in surrounding land values. In part the increase derives from improved accessibility for existing residents and businesses. High windfalls also arise once land has been rezoned to capitalise on higher development opportunities generated by the new infrastructure.</p>
<p>Since public investments and decisions are intended to maximise community benefit, it seems unfair and inefficient that some private landowners profit immensely from the process while others gain little or may even be disadvantaged.</p>
<p>Value capture mechanisms seek to rectify this by clawing back at least some of the increased business revenue or land value. These funds are then allocated towards the initial costs of infrastructure provision. In the case of a planning change, land value uplift can also help ensure that affordable housing for low income groups is included in new development.</p>
<h2>How does value capture work?</h2>
<p>The PM’s Smart Cities Plan doesn’t offer much detail as to how a value capture model would operate in Australia. Several different approaches are used overseas, but their potential transferability is unclear.</p>
<p>Transit value capture is used in Hong Kong and Japan to fund railway lines and new town development. This is a project-based approach which packages investment in railway and housing development together. Commercial holdings along the railway line deliver an ongoing revenue stream as does long term investment in residential development. In Hong Kong, a significant program of public rental and subsidised home ownership has also been delivered as part of this model.</p>
<p>Project-based transit value depends on access to large swathes of low cost land (in Hong Kong the government retains land ownership, so the land component is essentially free). It also depends on ongoing residential and commercial investment along the new route over time, which in turn assumes buoyant economic growth. When the Japanese economy stagnated, the potential for railway operators to self-finance their projects did too.</p>
<p>Tax Increment Financing (TIF) is used widely in the US to finance new transit and urban renewal projects. The model draws on anticipated increases in business revenue or rents in areas where incremental value uplift will occur. A portion of the increase is captured via a special property tax which is then allocated to repay the debt.</p>
<p>Australian local governments can also introduce special purpose levies to fund specific items through property taxes or rates. The Gold Coast light rail project for instance, was partly financed via the council’s annual transport levy (now around $111). However, since the levy applies to all ratepayers, rather than confined to areas where direct value uplift occurred, this doesn’t represent value capture in the strict sense of the term.</p>
<p>Value capture through the planning process is another approach. Unlike development contributions, which in Australia are used to internalise the costs of servicing a particular project (like roads, carparks, or footpaths), so they aren’t borne by existing ratepayers, value capture focuses on the benefits (often called “betterment” or “planning gain”) accruing from public investment or planning decisions.</p>
<p>One way of capturing value created through public investment or planning is to levy the charge on the first property transaction (ie. land sale) following the change. Another is to add an additional levy to existing contributions paid by developers.</p>
<p>The NSW government’s foreshadowed “Special Infrastructure Contribution” for new residential development along the Parramatta Rd light rail corridor ($200 per metre of gross floor area) is a recent example.</p>
<p>While this amounts to around $20,000 an apartment (at most about 3% of current sales prices), industry lobby group the Urban Taskforce claim the levy will discourage development and hurt home buyers. That’s cheeky since house prices are set by the market – which in the case of a light rail corridor will rise by much more than 3%. Ultimately the Taskforce worries that value capture places “an unfair burden on particular sectors of society” by which they presumably mean landowners and developers.</p>
<h2>What would need to happen to extend value capture models in Australia?</h2>
<p>Besides the politics, a number of issues must be addressed if value capture is to be extended in Australia. First, calculating value uplift is complex. Often land prices rise well in anticipation of investment or a planning change, so robust framework for value capture should be in place well before such speculation might occur.</p>
<p>Second, value capture should not discourage development or make land acquisition more expensive. This means close attention to project viability when setting capture requirements. Third, robust mechanisms for collection through either the planning process, as an ongoing property tax, or when land is sold, are needed.</p>
<p>Finally, although the current conversation focuses on transport, over time there will be pressure to fund other socially beneficial infrastructure. Two obvious candidates are schools, which also improve land values, or affordable housing, which is often lost when land values rise.</p>
<p>However fuzzy current conversations about value capture may be, the Commonwealth’s new interest in cities and the need to support more affordable homes near public transport, is welcome. So too the recognition that public investment and policy changes in urban and regional areas generate enormous value, which can and should be shared more widely.</p>
<p><em><span class="fn author-name">Nicole Gurran is p</span>rofessor - Urban and Regional Planning, University of Sydney and author for The Conversation. She can be contacted <a href="https://theconversation.com/profiles/nicole-gurran-759" target="_blank">here</a>.</em></p>
<p><em><span class="fn author-name">Stewart Lawler is l</span>ecturer in Property and Built Environment, University of Sydney and author for The Conversation. He can be contacted <a href="https://theconversation.com/profiles/stewart-lawler-262628" target="_blank">here</a>.</em></p>
</body></html>

What is ‘value capture’ and what does it mean for cities?

<html><body>
<p class="Body">There’s been a lot of discussion about a resurgence in Sydney prices, but I’m not believing it.</p>
<p class="Body">The talk is based primarily on one month’s figures from one source, which suggested a significant rise in Sydney house prices in May.</p>
<p class="Body">People are so willing to blindly accept the figures pumped out by research companies. One international ratings agency rushed out a new assessment of the Australian residential market, complete with dire warnings, based on that one figure – apparently oblivious to the frequent statistical aberrations in price data for short time periods. </p>
<p class="Body">Those figures for May presented a large number of very strange results. For example, are we seriously expected to believe that Hobart apartment values rose 8.4% in a single month? Or that Darwin apartment values declined 10 percent in May? Or that, in sharp contrast, Darwin house prices surged 3.5 percent in May? Or that unit prices dropped 6% in a month in both Canberra and Perth? Or that house values in Sydney suddenly turned around and jumped 3.6 percent in May?</p>
<p class="Body">The absurd nature on some of these numbers shows how rubbery real estate figures can be, especially when you’re dealing with month-to-month changes, which are notoriously erratic and essentially meaningless.</p>
<p class="Body">The Sydney figure was particularly strange because there has been a major drop-off in sales activity this year. Sales volumes have been trending steadily downwards since the end of 2014 in fact, but it’s been particularly pronounced in 2016 – and exacerbated recently by the calling of a federal election, which always causes consumers to stop dead with their decision-making and action-taking.</p>
<p class="Body">The thing is: all other price data, including the March Quarter figures from the ABS, has been recording a contraction of Sydney price growth, which is exactly what I would expect. It’s extremely rare in housing markets for prices to keep rising when there’s a significant decline in sales activity.</p>
<p class="Body">Hotspotting research for The Price Predictor Index finds not a single growth market in the Sydney metropolitan area, which contains over 700 suburbs. Many suburbs are in steady decline.</p>
<p class="Body">An example is Auburn (median house price $835,000, down 1.7 percent in the three months to April, according to Australian Property Monitors), where there were over 200 sales per quarter in late 2013, dropping to 170 in late 2014, 100 late in 2015 and now 75 per quarter.</p>
<p class="Body">Likewise, Bankstown ($840,000, down 2.7 percent percent in three months) was recording over 200 sales per quarter late in 2013, but numbers have fallen steadily to 95 per quarter late in 2015 and 80 per quarter in 2016.</p>
<p class="Body">Sales in Breakfast Point (median unit price $1.06 million, down 4.9 percent in three months) have fallen from 110 to 88 to 70 to 43 to 33 to 26 in consecutive quarters. </p>
<p class="Body">In Cammeray (median house price $1.7 million, down 10.6 percent in three months), sales have dropped from 58 to 54 to 46 to 37 to 30 to 26 since late 2014. In Fairfield ($720,000, down 2 percent in three months) sales in the past four quarters have been 107, 77, 56 and 35. In Pymble ($2.05 million, down 3.3 percent in three months) sales levels have dropped from 112 to 99 to 71 to 64 to 39 in the past five quarters.</p>
<p class="Body">Unit sales in CBD fringe suburb of Haymarket (median unit price $895,000, down 1.8 percent in three months) have dropped from 77 to 57 to 39 to 24 to 9.</p>
<p class="Body">In Parramatta ($565,000, down 1 percent) unit sales have declined from 172 to 165 to 107 to 95 in the past four quarters, while in Potts Point ($710,000, down 4.3 percent), unit sales have dropped from 110 to 66 to 47 in consecutive quarters.</p>
<p class="Body">There are myriad other examples, all charting the same pattern of decline in sales volumes, with prices starting to follow.</p>
<p class="Body"><em>Terry Ryder is the founder of <a href="https://www.hotspotting.com.au/" target="_blank">hotspotting.com.au</a>. You can <a href="https://mailto:ryder@hotspotting.com.au" target="_blank">email him</a> or follow him on <a href="https://twitter.com/hotspotting" target="_blank">Twitter.</a></em></p>
</body></html>

Latest Expert Insights

Parcel delivery is joining the apartment amenity checklist

Guides

Editor's Picks

Guides

Developments

New apartments

New townhouses

News

Latest Expert Insights

Parcel delivery is joining the apartment amenity checklist

Guides

Editor's Picks

Receive the latest news stories to your inbox

Guides

Developments

New apartments

New townhouses

News