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“Minister Chanthivong and his team have shown real leadership in replacing an outdated two-year bond with cover that matches the lifespan of the buildings people are buying into.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

Joel Robinson

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

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

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

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

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

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

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

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

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

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

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

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

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

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

Every First Home Owner Grant for new property by state

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

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

Staff Writer

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

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

alisonwarters@gmail.com

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

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

Ellen Walker

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

When buying an apartment, most people compare the big-ticket items first. Floorplans. Kitchens. Balcony size. Natural light. The view.

But there's one everyday consideration that often doesn't come up until after moving in: how parcels are delivered.

As online shopping has become part of everyday life, parcel deliveries have shifted from an occasional event to a regular occurrence. Australians spent a record $82.6 billion shopping online in 2025, with almost one in every four retail dollars now spent digitally.

For apartment residents, that can present a challenge.

If nobody is home to accept a delivery, parcels may be redirected to a nearby Post Office, left in a building lobby or common area, or require building management to step in. In higher-density buildings, where dozens or even hundreds of residents may receive deliveries each day, parcel management has become an increasingly important part of everyday living.

That can create a range of frustrations. A missed delivery often means making time to collect a parcel elsewhere, while packages left unattended in foyers or mail areas can create clutter and increase the risk of theft. What seems like a minor inconvenience can quickly become a recurring issue for residents who shop online regularly.

It's one of those details that rarely features in a display suite but can have a noticeable impact once residents move in.

As a result, buyers are beginning to look beyond traditional apartment features and consider how a building supports day-to-day convenience, including whether there are secure options for receiving deliveries.

Australia Post's Parcel Lockers provide one solution.

<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/CkF2oKmlACg?si=C50sDaoUUn2nuLmq" title="YouTube video player" width="560"></iframe>

Rather than having a parcel delivered directly to an apartment, eligible deliveries can be sent to a nominated Parcel Locker. Once the parcel arrives, residents receive a notification through the AusPost app or SMS and can collect it using a QR code or one-time PIN at a time that suits them.

The Parcel Locker network now includes more than 1,500 locations nationwide, with installations at Post Offices, shopping centres, transport hubs and an increasing number of residential developments. By providing a secure collection point, Parcel Lockers help reduce missed deliveries and avoid parcels being left unattended in common areas.

For developers, parcel infrastructure is becoming another way to improve the resident experience. Rather than relying on concierge staff or leaving parcels in communal spaces, secure collection points help streamline deliveries while preserving the presentation and functionality of shared areas.

For buyers, it's a reminder that the best apartment features aren't always the most obvious.

A generous floorplan or quality finishes might help narrow the shortlist, but the conveniences that simplify everyday life, whether that's EV charging, secure bike storage or reliable parcel delivery, often become the features residents appreciate most once they're living there.

The apartment feature many buyers don't think about, until their first missed delivery

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The Reserve Bank of Australia governor Glenn Stevens expects interest rates can remain low for some time yet, as long as housing market “pockets of potential over-exuberance” and "over excitement" remain in check.
The need for stronger growth outside the resources sector justified the present low interest rate settings, he said in a speech to the Committee for Economic Development in Melbourne last night.
“Inflation is well under control and is likely to remain so over the next couple of years,” he said.
“In such circumstances, monetary policy should be accommodative and, on present indications, is likely to be that way for some time yet.
“But for accommodative monetary policy to support the economy most effectively overall, it’s helpful if pockets of potential over-exuberance don’t get too carried away.”
The CommSec chief economist Craig James noted the Reserve Bank Governor delivered a powerful speech that could only be described as a “call for action”, targeted at the conservativeness of the business sector.
"It implores Australian business people to believe in themselves and take greater risks," James said.
"It was the type of speech that a coach delivers to his players.
"It is definitely a speech worth reading."
James further noted the Reserve Bank Governor attempts to set the record straight with his views on housing, pointing to three quotes within the speech
“Credit outstanding to households in total is rising at about 6–7% per year. I see no particular concern with that,” he said.
“It is not clear whether price increases will continue or abate. Furthermore, it is not to be assumed that investor activity is problematic, per se. A proportion of the investor transactions are financing additions to the stock of dwellings, which is helpful. It can also be observed that a bit more of the ‘animal spirits’ evident in the housing market would be welcome in some other sectors of the economy.”
“Nor, let me be clear, have we seen these dynamics, thus far, as an immediate threat to financial stability. The Bank's most recent Financial Stability Review made that clear. So we don't just assume that all this is a terrible problem.”
The Reserve Bank Governor does acknowledge that there are signs in the investor housing market where “some people might be starting to get just a little overexcited”. 
The Reserve Bank is working with other agencies on reviewing lending standards. But he makes clear the purpose of the review. 
“Let's be clear what this is not about," says Stevens.
"It is not an attempt to restrain construction activity. On the contrary, it is an attempt to stretch out the upswing.
"Nor is it a return to widespread attempts to restrict lending via direct controls.”
The Reserve Bank Governor makes it clear that rates aren’t set to rise to address the strong growth in investor housing lending.
“The economy has spare capacity. Inflation is well under control and is likely to remain so over the next couple of years," Stevens advised.
"In such circumstances, monetary policy should be accommodative and, on present indications, is likely to be that way for some time yet
"But for accommodative monetary policy to support the economy most effectively overall, it's helpful if pockets of potential over-exuberance don't get too carried away."
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jchancellor-FAypfDUnLy

Interest rates can remain low if property over exuberance curtailed: RBA's Glenn Stevens

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The latest SQM Research vacancy rate figures have found vacancy rates dipping slightly for the second consecutive month, in what is likely a seasonal trend.
Currently, the national vacancy rate is 2.1% with 62,947 vacancies. Year on year, this sees the national vacancy rate at a fairly stable figure, recording 2.0% in October 2013 and 2.2% in September 2014.
Despite the national figure remaining stable, <a href="https://www.sqmresearch.com.au/" target="_blank">SQM Research</a>’s managing director Louie Christopher pointed to drastic vacancy rate changes when drilling down to the capital city levels, perhaps as a result of the falling mining boom.
For instance, Perth in October 2013 recorded a vacancy rate of 1.5%. It is now 0.9% higher.
Similarly, Darwin recorded a 0.9% vacancy rate in October 2013 and now sits at 2.1%.
Canberra has recorded a reduction in the vacancy rate from 2.1% in October 2013, and in September 2014, to 1.8% in October 2014.
“The rental market was steady over the month with the trends observed over the course of the year, continuing on in October,” said Christopher.
“We continue to see ongoing rental weakness in Perth and Darwin. Canberra is now providing signals that perhaps the worst of the rental downturn is over with a slight fall in vacancies year on year and a rise in asking rents for the month,” he said.
He noted that Sydney appears to be the strongest rental market at present, with asking rents up 6.8% for the past 12 months. However, he said that he expects this to slow in 2015 with increased stock coming onto the market for the city.
Vacancy rates (from highest to lowest):
<ul>
<li>
Melbourne 2.5% 
</li>
</ul>
<ul>
<li>
Perth 2.4% 
</li>
</ul>
<ul>
<li>
Brisbane 2.2% 
</li>
<li>
Darwin 2.1% 
</li>
<li>
Canberra 1.8% 
</li>
</ul>
<ul>
<li>
Sydney 1.6% 
</li>
</ul>
<ul>
<li>
Adelaide 1.5% 
</li>
</ul>
<ul>
<li>
Hobart 1.3%
</li>
</ul>
Turn over page for SQM Research’s results on the changing rents charged across the capital cities.
<hr class="system-pagebreak">
<img src="/images/2014/11/19/sqm%20nov%2019%20one.png" alt="">
Source: <a href="https://www.sqmresearch.com.au" target="_blank">SQM Research</a>
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jduke-EHk3XBmHkn

Drastic Perth and Darwin vacancy changes: The weakest capital city rental markets

Seven things to know about the stamp duty debate

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There has never been a shortage of people calling property unaffordable and it has become common practice to discuss the idea of parents becoming guarantors for their children to assist, particularly where deposits are not sufficient.
Becoming a guarantor leaves the parents with a loan over their home, restricting their potential future borrowing capacity and leaving them at the mercy of their children’s astute repayments.
However, Smartline Personal Mortgage Advisers’ executive director Joe Sirianni is pointing to a potential new solution. Under this loan structure, which differs from a straightforward cash loan or gift to your child, the bank lends up to 90% of the property value, with a separate loan from the parents of 10% to 20% of the home.
It must be a freestanding property that the first home buyer is purchasing, explains Sirianni.
“Many parents are keen to give their children assistance to give them that first leg up on the property ladder, which is admirable, but it is a big commitment,” he said.
“Providing a guarantee can, in the worst case scenario, leave the parents open to losing their home if the child can’t or won’t meet their debt obligations to the bank. Even without the worst happening, being a guarantor can still impact on the parents’ ability to borrow or sell the property.”
He also warned that cash loans and gifts are often not recognised by lenders as a genuine deposit or could be lost if a child and their partner split up.
“The only thing riskier than lending to family is lending to complete strangers, which is what banks do thousands of times a day,” he said.
Sirianni explains this structure effectively gives the child two loans. While the smaller loan is to the parents, the bank still manages the repayments, security and paperwork for the parent’s loan for a deposit. The interest rate charged on the portion of the loan that is from the parents is 50% that of the main loan.
Those giving their children the loan can see the full amount paid out through repayments or as a result of sale or refinancing.
“While some parents may have been very reluctant to provide financial assistance in the past, they should feel far more comfortable knowing they have security over the children's property,” said Sirianni.
“It will no doubt make it easier for children to ask for help, and for parents to be able to say yes, knowing they are protected.”
One such product, from Bluebay Home Loans, is called a Parent Assist Loan. It markets itself as an Australian first.
Interestingly, parents who involve themselves in these loans are also eligible to receive a share of the investment growth on the property.
{mijopolls 64}
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Would you give a loan to your children? 

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A fire damaged St Peters home will be auctioned this weekend.
The house at <a href="https://www.realestate.com.au/property-house-nsw-st+peters-118283099" target="_blank">81 Frederick Street, St Peters</a> exhibits significant burns, with soot blackening the interiors and façade. Photos above show one room completely ruined, with a collapsed ceiling.
Selling agents Santos Sulfaro and Frank Sulfaro of Richardson &amp; Wrench Leichhardt are expecting the home will attract around $650,000 when auctioned on Saturday morning by Damien Cooley.
The three bedroom, one bathroom house is being marketed as a blank canvas with renovation or development potential – albeit rather dramatically, as seen in the video titled Fire Sale below.
{qtube vid:=EFF3Cojzuw0}
The owner is reportedly a former IT worker who isn't able to claim insurance for the fire after allegations it was deliberately lit by an unidentified occupant who faces court next week, according to <a href="https://news.domain.com.au/domain/real-estate-news/firedamaged-st-peters-house-listed-for-650000-20141029-11cyz6" target="_blank">Domain</a>. He paid $290,000 for the freestanding brick house in 1998.
Police confirmed to media a 55 year old man was due to appear in court on 1 December, facing charges of contravening an apprehended violence order and damaging a property by fire.
 <img src="/images/2014/11/19/306.JPG" alt="">
Above: The home in healthier condition, 2004.
According to the listing, despite "dramatic fire damage" to the hallway and one bedroom, the other areas are mostly only affected by soot.
The house, on 195 square metres, has a recently renovated bathroom, metal press ceilings, timber floors and tessellated tiles. Its $650,000 guidance prices it well below its neighbours – the median price of <a href="/news">St Peters </a>house in October was $1,212,000, according to RP Data. Last week, an unrenovated three bedroom brick home in St Peters <a href="https://www.realestate.com.au/property-house-nsw-st+peters-118222391" target="_blank">sold for $800,000</a>.
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jrichardson-uRX5hFdKfN

Catching fire: St Peters’ burnt offering

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Westpac's chief economist Bill Evans says yesterday's Reserve Bank Board minutes continued to provide a generally downbeat assessment of the Australian economy.
He noted the bank rightly focusses on potential for a lift in household spending.
"The growth outlook is a little less optimistic while there appears to be less hysteria around the potential risks associated with the housing market.
"Indeed there is no implication of a substantial intervention by the authorities."
Evans says the boost to house prices is "seen to be a positive" and it points out that retail sales have been stronger in those statements with more house price growth.
"However, they do point out that expectations for low income growth may weigh on consumption.
"In that regard the Westpac Consumer Sentiment Index component index tracking consumers’ assessments of their finances relative to a year ago has fallen by 15.7% year.
"While credit extended to investors in housing is noted to have continued to grow at a noticeably faster pace than credit to owner-occupiers the concerns around imbalances in the housing market appear to have possibly eased.
"Certainly it is pointed out that house price inflation has slowed and whereas in the October minutes discussions between the Bank and APRA on banks’ lending standards are specifically referred to these minutes are silent on that issue."
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Hysteria on housing risks lessening: Westpac's Bill Evans

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The two bedroom Old Mechanics Institute built in 1857 in South Melbourne, has been sold by the Black family. 
It is a striking bluestone hall with interior dimensions of 340 square metres of contemporary space.
It last sold in 2012 at around $2 million and first sold after its fit-out in 2007 by property developer Karl Kutner at $1,725,000.
<a href="https://www.realestate.com.au/property-house-vic-south+melbourne-117677555" target="_blank">Abercrombie's Sam Goddard was taking offers</a> on 272a Dorcas Street until 15 September, then listed it for mid-October auction, but didn't secure the sale until late October.
No sale price has been revealed.
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South Melbourne 1857 mechanics institute conversion sold

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Much of the discussion on housing affordability centres on first home buyers’ ability to enter the property market.
First home buyers accounted for only 12% of the total number of owner occupiers taking out mortgages in September, Australian Bureau of Statistics data shows. That’s down from the long-term average of almost 20% indicating new entrants to the property market are either unable or unwilling to make their first purchase.
But new research, <a href="https://www.ahuri.edu.au/publications/projects/p53021?utm_source=2&amp;utm_medium=53021&amp;utm_campaign=home#sthash.UWqrtVLY.dpuf" target="_blank">Housing affordability dynamics in Australia: new insights from the last decade</a>, reveals a more complicated picture of housing affordability that shows the challenges of paying for accommodation are not confined to those who are looking to enter the property market for the first time.
The research by Gavin Wood, Rachel Ong and Melek Cigdem for the Australian Housing and Urban Research Institute (AHURI) at RMIT University and Curtin University will be presented at Parliament House in Canberra on 4 December.
It finds housing affordability has deteriorated in Australia over recent decades for both owner occupiers and for people in the rental market.
Analysing ABS data, the researchers found the proportion of household income that owner-purchasers spent on housing increased to 18% from 12% over the 27 years from 1982 to 2009.
In line with that increase, the proportion of owner purchasers with housing costs in excess of 30% of their income – a level where people are considered to be in mortgage stress – doubled from 10% to 20% of all owner-purchaser households from 1982 to 2009, the report found.
<img src="/images/2014/11/17/zoe-nov-17-one.jpg" alt="">
<address>
Source: Housing affordability dynamics in Australia: new insights from the last decade
</address>
People in the private rental market are also spending more of their income on accommodation than in the past.
In 2009, tenants spent 24% of median gross household income on rent, while just 17% of median income was needed to cover the median rent in 1982. Nearly one in three tenants in the private rental market was spending more than 30% of their income on rent in 2009, up from 22% in 1982.
The research finds many people go through periods of being comfortable in affording their mortgage or rental payments before slipping into a situation where they struggle to meet these financial commitments.
Between a third and half of tenants in the private rental market have been devoting more than 30% of their income to rental payments for a year or more, the research found.
Around 20% of owner-occupiers had experienced one or more periods of housing affordability stress, the study found. This usually lasted only one year and it was rare for owner occupiers to remain in housing stress for more than five years.
Almost 70% of people who suffered housing stress had only one period where they were in financial difficulty, while 30% had two or more periods between 2001 and 2011 when housing ate up more than 30% of their income.
The price of housing and income levels both contribute to whether a person will find housing affordable. It’s not surprising then that affordability has fallen in some cities where properties have made huge capital gains but income levels have risen more modestly.
Debt levels have also risen significantly for people of all ages, but particularly for those aged 25 to 34 years, the research found.
On average, home owners aged 25 to 34 had mortgage debt worth 61% of the value of their property in 2009, compared with 41% in 1990, the report found. Additionally, fewer people in this age bracket owned a home (37.7% in 2009 compared with 55.5% in 1982).
This was also the case for people aged 35–44 years. In 2009, 62.1% of people in that age bracket were buying their home, compared with over 75% in 1982.
<img src="/images/2014/11/17/zoe-nov-17-two.jpg" alt="">
Source: Housing affordability dynamics in Australia: new insights from the last decade(Page 6)
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zfielding-GvX3Uq9KTa

Both owner occupiers and renters suffering from deteriorating housing affordability

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Hi Margaret,  
I am an international student who has just graduated and I am planning to move back for good.
My parents are considering selling their apartment in Bondi Junction.
In your opinion, do you think we should sell?
Or would you recommend that instead of selling we keep the apartment and rent it out instead?  
Thank you for any information and advice you may be able to provide, it is very much appreciated.  
Kind regards,
Irene
Margaret's answer on the next page. Please click below. 
<hr class="system-pagebreak">
Hi Irene,
The decision about whether to keep a former owner occupied property, or instead rent it out, involves a lot more considerations than just whether the time is right or if it will make a good investment, although these two matters are definitely part of the analysis.  
It’s hard to know exactly where to start and so the following information is not necessarily in order of how the considerations need to be made, but all of them must be considered:  
<ul>
<li>
A principal place of residence is capital gains tax free as long as it’s sold within the allowable period.  Your parents can move out of the apartment and keep it CGT free up to six years, as long as they do not have another property on which they claim the principal place of residence exemption.  If they do move out and buy another property, they can have a strict six month period of overlap where they can have two exemptions, but if this is missed by even one day (that is, the property is not sold) then they are liable for CGT on one of the properties right back to when they first moved out.
</li>
<li>This is important because if instead they sell and take the tax free gain, they can use this to buy another owner occupied property with low or no debt.  If they wish, they can borrow against the equity in that new owner occupied property and invest elsewhere, with a fully tax deductible debt.</li>
<li>
If they keep the Bondi apartment and rent it out, only the property's current debt can be claimed as a tax deduction.  Even if they use that property as security for further funds to buy another home of their own, that debt is not a deductible one as it is the purpose for the loan, not what secures it, which determines tax deductibility.  In some cases people doing this end up a little upside down – they have a large debt on a house they live in (with no deductions allowed) and a small one on an investment.
</li>
<li>
People often keep a former home because they think it will make a ‘good investment’, and this is based on emotion rather than any researched facts to support whether or not it is a good place to invest.
</li>
</ul>
The first thing to consider is whether or not this area has the capacity to deliver as good as, or better, growth and yield than any other area. 
Keeping it may prevent your parents from investing in an area with a better capacity to grow in the coming few years and a higher rental yield, giving an all- round better performance. 
Usually, areas which have already become ‘blue chip’ have their best period of performance behind them, and unless there is some major development or infrastructure project on the way, such an area is more than likely to grow with only a lacklustre result. 
For sound investing and a return better than bank savings interest rates, you need to find an area on the cusp of its best period of growth (as in a pre- blue chip area) and you are not likely to find that in the upmarket, favoured suburbs of our capital cities. 
Great investing opportunities are usually in formerly remote suburbs or newer suburbs catering to families – the kind with major infrastructure projects ahead of them and burgeoning populations which drive year- in, year- out growth in value and rental yield.  
It’s rarely the right thing to keep a former home and make it into an investment. 
Your parents need some good advice from a qualified property investment adviser, one whose best interests are not served by selling them a property, to ascertain their bottom line financial position in relation to any debt on this property and any they may move to and to establish just what will be the most appropriate strategy for this time in their lives.
Have a property question? <a href="mailto:askmargaret@propertyobserver.com.au" target="_blank">Ask Margaret!</a>
This article was first published on Property Observer in July 2013.
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mlomas-KC9MUPZ6Ca

Should I turn my home into an investment property? Ask Margaret

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According to the CoreLogic RP Data Home Value Index results in October 2014, combined capital city home values have increased by 8.9% over the past year. 
The rate of growth is now decelerating after reaching a peak annual growth rate of 11.5% in April 2014.  The two cities which have been the real driver of value growth, Sydney and Melbourne, are also now seeing the rate of value growth slowing.
The RBA has previously stated that as the economy transitions away from mining investment that it was specifically looking for a pick-up in residential property.  To date there has been a pick-up, in buyer demand, as well as home values and dwelling construction however, with value growth having peaked and dwelling approvals now -15% lower than their recent monthly peak will the pick-up in the residential segment of the economy be enough to offset mining?  It is beginning to look increasingly unlikely.
As we have showed, the residential housing sector is still quite strong but is slowing from its peak.  Although approvals have dropped there remains a strong pipeline of housing construction which should continue over the coming years however, the spike in construction could be somewhat short-lived overall.  If we look at the other sectors of the economy, economic data appears to be increasingly turning more negative than positive.
According to Westpac and the Melbourne Institute, consumer sentiment has been mired in higher levels of pessimism than optimism for the past nine months.  The last time pessimism had outweighed optimism for this long was in the middle of the financial crisis.
Last week we learned that wage growth remains benign.  According to the Australian Bureau of Statistics (ABS) the wage price index has increased by just 2.6% over the year to September 2014.  With inflation recorded at 2.3% there is very little real growth in wages at the moment.
With wage growth so low, we are also seeing the highest unemployment rate the country has seen in more than decade.  According to ABS data, the unemployment rate was recorded at 6.2% in October and sits at a level not seen since early 2003.  If employees can’t negotiate a decent pay rise it is not as if businesses are actively seeking employees.
Commodities, which were previously a key driver of the Australian economy have seen prices drop significantly over the past year.  According to the Reserve Bank’s (RBA) monthly index of commodity prices, Australian commodity prices are -16.9% lower over the past year and -38% lower than their July 2011 peak.
Earlier this year Australia had recorded international trade surpluses for three consecutive months.  The monthly trade surplus reached as much $1.4 trillion however, in September the trade deficit had sunk to $2.3 trillion.  This $2.3 trillion figure was the largest monthly trade deficit since November 2012.
According to the National Australia Bank, business conditions have improved sharply.  Their index of business conditions rose by an all-time high 12 points in October to reach its highest level since February 2008.  Although business conditions may be up, confidence across the business sector continues to fall.  In October business confidence fell by a point to its lowest level since August of last year.
Retail trade recorded a somewhat surprising bounce of 1.2% in September.  Although this was the strongest monthly increase since February last year it comes following relatively light increases of 0.7%, 0.4% and 0.1% over the previous three months.  One wonders if it is an outlier. 
In fact, Westpac and the Melbourne Institute asked respondents to their consumer sentiment survey about their spending intentions this Christmas.  The survey results indicated that 38% of respondents were going to spend less and 50% were going to spend the same.  Westpac reported that the net balance (more minus less) of -26% was the worst since 2008 in the middle of the financial crisis.
The latest read on population growth shows that population growth is slowing.  Although growth in the number of new Australians remains strong, population growth over the year to March 2014 was at its lowest level since the year to June 2012. 
Furthermore, the more up-to-date overseas arrivals and departures shows that net long-term and permanent arrivals over the 12 months to September 2014 were at their lowest level since the 12 months to October 2011.  This data would indicate a further slowing of net overseas migration, particularly within the mining states where the slowdown in both overseas and interstate migration has been the most substantial.
The strong rate of population growth has been a significant driver of gross domestic product.  Over the 12 months to June 2014, the Australian economy grew by a quite healthy 3.1%.  Although this headline figure is quite good, on a per capita basis the economy grew by a much lower 1.6%. With population growth slowing we would expect GDP per capital to also slow.
While there are a lot of negatives here, one of the positives recently has been the declining Australian dollar.  At the end of October 2014 the exchange rate with the $US was 88 cents which is much lower than it has been of late.  A lower Australian dollar should help our manufacturers, exporters and tourism however, that will take a while to flow through.
With the housing market and housing approvals seemingly topping out we need some other industries to help with the heavy lifting as commodity prices remain low and the pipeline of larger infrastructure projects related to the resources sector continue to taper away. 
We aren’t sure who or what these industries are but a further devaluation of the Australian dollar would certainly help some of the prime candidates such as tourism, manufacturing and education for overseas students. 
The Reserve Bank has stated that monetary policy has largely done all it can to assist and now it’s up to the government to manage fiscal policy in such a way that can assist the transitioning economy. 
In my mind this can’t come quick enough because the economy is softening and the housing market needs help to manage this transition.
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