High-profile apartment defect cases have changed the way many NSW buyers approach purchasing, putting greater scrutiny on building quality, strata records and the parties behind a development before a contract is signed.

The industry buyers are assessing today, however, is also different from the one in which cases such as Opal Tower and Mascot Towers emerged.

NSW has introduced a series of regulatory measures aimed at strengthening oversight of apartment construction, including Building Commission NSW, the Residential Apartment Buildings Act 2020 and the Strata Building Bond and Inspections Scheme. Under the latter, developers are required to lodge a bond, with independent inspections forming part of the process for identifying defects in new strata developments.

Those changes provide another layer of protection, but they haven't removed the importance of buyer due diligence.

[smartcode_project:default project_id=5743 project_image_fid=372394]

For purchasers considering an apartment, that means looking beyond the residence itself. Building and strata history, strata reports, the track record of the builder and developer, the condition of common property and any known or planned expenditure by the owners corporation can all form part of assessing a building before purchase.

Whether the development is already complete can also materially change what can be assessed.

An off-the-plan purchaser is necessarily buying before the finished product exists. A completed apartment, by comparison, can be walked through before contracts are signed, allowing the purchaser to see the finishes, common areas and broader building as they have actually been delivered rather than relying solely on plans and renders.

It also removes exposure to some of the uncertainties that exist between an off-the-plan purchase and completion, including construction delays, cost pressures and builder insolvency during the delivery period.

[smartcode_project:default project_id=5743 project_image_fid=927]

<a href="https://www.apartments.com.au/project-marketer/equitifund-group">Projects by Equitifund</a> National Sales Director Ben Hamblett said that greater focus on tangible evidence is increasingly evident among apartment purchasers.

“The biggest shift we're seeing is buyers wanting proof, not promises,” Hamblett said.

“That's exactly why we deal in completed stock - you can inspect the building before you commit - and why we've backed every purchase with a cash bond against special levies.”

At <a href="https://www.apartments.com.au/buildings/the-lennox-parramatta-12-phillip-street-parramatta-nsw-2150">The Lennox</a> in Parramatta, that emphasis on a completed, inspectable product is already in place.

The 413-apartment, 46-level tower at 12 Phillip Street is being marketed by Projects by Equitifund, allowing prospective purchasers to inspect the residences, common areas and resident facilities before committing.

[smartcode_project:default project_id=5743 project_image_fid=375255]

The Lennox also introduces another layer to the due-diligence conversation through Strata Surety.

The vendor-funded arrangement provides purchasers with a cash-backed bond held in their own solicitor's trust account from settlement. According to Equitifund, the bond covers any special levy raised during the applicable cover period and is provided at no cost to the purchaser.

Special levies can create an unexpected cost for apartment owners where an owners corporation needs funding beyond its existing strata contributions. Under NSW strata law, a special levy requires approval by owners at a general meeting.

Equitifund Executive Chairman Greg Huxley said Strata Surety was designed to provide something more concrete than reassurance about that potential exposure.

“Buyers have every right to ask hard questions about strata risk - the industry has given them plenty of reasons to,” Huxley said.

“Our answer isn't a reassurance, it's a bond. Strata Surety puts real money behind that confidence, held by the buyer's own solicitor, not by us.”

[smartcode_project:default project_id=5743 project_image_fid=375281]

For The Lennox, its completed status also means purchasers can assess not only the apartment itself, but a building that has already been occupied and operating for several years.

Completed in 2021, the $300 million development, designed by <a href="https://www.apartments.com.au/architects/marchese-partners">Marchese Partners</a>, comprises one, two, three and four-bedroom apartments, with open-plan living areas extending to private balconies. Interiors incorporate engineered timber flooring, stone benchtops and integrated appliances, while many upper-level residences have views across the river and surrounding district.

Its established amenity can similarly be inspected in operation. Resident facilities include the Watermark precinct with a 20-metre pool, outdoor terrace, barbecue areas, gym, fitness studio and conference room, while ground-floor retail addresses the river walk and surrounding public space.

The Lennox is also home to the Southern Hemisphere's first fully robotic residential car park, which has now operated for several years. Its nine-level basement combines three conventional parking levels with six automated levels, accommodating 327 vehicles using technology from German firm Lödige Industries.

[smartcode_project:default project_id=5743 project_image_fid=925]

The riverfront address puts The Lennox close to much of central <a href="https://www.apartments.com.au/developments/parramatta-nsw-2150">Parramatta</a>'s existing infrastructure, including Parramatta Station, Westfield Parramatta, Parramatta Park, and the Church Street dining precinct.

The remaining apartments form part of a limited release secured by Equitifund, following the sale of the majority of residences before and shortly after completion.

The regulatory environment around NSW apartment construction has changed considerably since the defect cases that reshaped public discussion around the sector. For purchasers, however, regulation is only one part of the equation. The ability to investigate a building's history, review its strata position and, where possible, inspect what has actually been delivered remains central to making an informed apartment purchase.

At The Lennox, its completed status provides that opportunity before contracts are signed, while Strata Surety adds a financial backstop against special levies beyond the protections already provided under NSW strata law.

[smartcode_project_cta:default project_id=5743]

Joel Robinson

Buying with confidence: What NSW apartment buyers should check beyond the defect headlines

Too often, heritage buildings become the podium for a contemporary tower. At <a href="https://www.apartments.com.au/new-apartments/623-collins-607-623-collins-street-melbourne-vic-3000">623 Collins</a>, <a>Sterling Global</a> challenged its design team to reverse that process.

The brief to <a href="https://www.apartments.com.au/architects/plus-studio">Plus Studio</a> was deliberately simple: "Don't design around the heritage. Design from it." It became the philosophy behind a project that draws inspiration not only from two landmark heritage buildings, but from Collins Street itself, a street layered with architectural history and civic significance.

That philosophy has shaped one of <a href="https://www.apartments.com.au/developments/melbourne-vic-3000">Melbourne</a> CBD's most considered residential projects, where the 1924 State Savings Bank and neighbouring Batman's Hill Hotel have become the architectural foundation for 623 Collins rather than remnants preserved beneath a new development.

[smartcode_project:default project_id=145324 project_image_fid=372749]

Rather than approaching the site as a blank canvas, <a href="https://www.apartments.com.au/developers/sterling-global">Sterling Global</a> saw the existing buildings as the beginning of the story.

"Sites like this rarely become available," the developer said.

"623 Collins wasn't simply an opportunity to develop a prominent CBD site. It was an opportunity to restore and reimagine one of Melbourne's important heritage landmarks while contributing to the continued evolution of Collins Street. For us, the existing buildings weren't constraints. They were the beginning of the story."

Instead of mimicking the ornate heritage architecture, Plus Studio studied the proportions, rhythm and craftsmanship of the original buildings before translating those characteristics into a contemporary 42-storey tower.

[smartcode_project:default project_id=145324 project_image_fid=372748]

"The brief challenged us to create a contemporary landmark that respected Melbourne's architectural history without becoming nostalgic," Plus Studio said.

"Rather than mimicking heritage, we sought to understand its proportions, rhythm and material language before translating those qualities into a distinctly contemporary architectural expression."

The practice says the State Savings Bank and Batman's Hill Hotel became the project's primary source of inspiration, allowing the heritage buildings and contemporary architecture to exist "in conversation rather than contrast." Generous planted terraces further soften the transition between old and new, creating elevated green spaces while reinforcing the dialogue between the restored podium and the contemporary tower.

That dialogue continues throughout the interiors, where Melbourne designer Fiona Lynch developed a material palette inspired by the idea of alchemy, balancing contrasting materials that reference both the Neo-Grec detailing of the original bank and contemporary urban living. The result is a series of spaces that feel timeless rather than trend-driven.

[smartcode_project:default project_id=145324 project_image_fid=354343]

The project will deliver 316 residences across four collections, Heirloom, Signature, Reserve and the Penthouse Collection, with each responding differently to its position within the building, from the restored heritage podium through to the upper levels of the tower. The Heirloom Residences retain defining heritage elements including original heritage windows, generous proportions and high ceilings, while the tower introduces contemporary homes with expansive layouts and elevated views.

Amenities have likewise been designed to support long-term city living rather than short-stay convenience. Residents will have access to concierge services, wellness facilities including a pool, cold plunge, sauna, steam room and gym, alongside private lounges, entertaining spaces and dedicated resident clubs.

Sterling Global says that approach is resonating with buyers seeking permanence rather than novelty.

[smartcode_project:default project_id=145324 project_image_fid=354347]

According to the sales team, purchasers are looking for enduring architecture, generous floorplans, heritage character and long-term value, with many commenting that 623 Collins "doesn't feel like another apartment development" because of the way the architecture has been curated around the site's history.

Situated on the prominent corner of Collins and Spencer streets, the project occupies one of Melbourne's most recognisable gateway sites, marking the western entrance to the city's best-known street. For Sterling Global, it also reflects a broader shift in city-making.

"Rather than maximising development yield, the project embraces adaptive reuse as a design philosophy, allowing heritage to inform architecture, interiors and the overall resident experience," the developer said.

"The result is a building that feels uniquely connected to Melbourne."

[smartcode_project_cta:default project_id=145324]

How Sterling Global designed 623 Collins from Melbourne's history

Avant Townhomes is adding to Ivanhoe’s family-sized housing options with <a href="https://www.apartments.com.au/new-townhouses/three-82-ivanhoe-382-upper-heidelberg-road-ivanhoe-vic-3079">Three 82</a>, a collection of just 16 four-bedroom townhomes on Upper Heidelberg Road.

The <a href="https://www.apartments.com.au/developers/intrapac-property">Intrapac Property</a> townhome division has taken a contemporary approach to the traditional family home, pairing larger floorplans with the lower-maintenance format of a townhouse.

[smartcode_project:default project_id=152069 project_image_fid=374394]

Designed by <a href="https://www.apartments.com.au/architects/arcadia-studio">Arcadia</a>, with landscaping by Landsite, the homes feature generous open-plan living and dining areas that connect directly to outdoor spaces, with layouts also designed to maximise natural light and privacy.

Natural stone is used throughout the interiors, including in kitchens that pair stone surfaces with bespoke cabinetry, considered storage and SMEG appliances.

The four-bedroom layouts include built-in wardrobes and a main bedroom with its own ensuite, while family bathrooms service the additional bedrooms. Each home also includes a lock-up double garage and intercom entry.

[smartcode_project:default project_id=152069 project_image_fid=374399]

Energy efficiency has been incorporated into the design through solar panels, double glazing and reverse-cycle heating and cooling, with the homes targeting 7-star energy ratings.

Rather than incorporating extensive communal facilities, Three 82 has been conceived around private residential amenity, with the 16-home scale keeping the focus on individual homes and their own indoor and outdoor spaces.

The development is located at 382 Upper Heidelberg Road, around one kilometre from Ivanhoe Village's cafés and retail and a short drive from Eaglemont Station and Ivanhoe Station.

[smartcode_project:default project_id=152069 project_image_fid=374393]

Several of Ivanhoe's established schools are also nearby, including Ivanhoe Girls' Grammar and Ivanhoe Grammar School. The address also provides access to the suburb's parklands and the wider Yarra River corridor.

<a href="https://www.apartments.com.au/project-marketer/nelson-alexander">Nelson Alexander</a> has been appointed to handle sales.

Construction is underway and progressing well, with Three 82 currently tracking toward completion in Q2 2027.

[smartcode_project_cta:default project_id=152069]

Three 82 brings boutique four-bedroom townhome collection to Ivanhoe

Builder-developer&nbsp;<a href="https://www.apartments.com.au/developers/graya">Graya</a> has secured a prime Newstead site from fellow developer Fraser, subsequently lodging plans for The Silo, a major mixed-use residential project in Newstead designed around a new public laneway linking the James Street precinct with the wider Gasworks and Newstead neighbourhood.

Proposed for the corner of Chester and Morse streets, the <a href="https://www.apartments.com.au/architects/bureauproberts">Bureau^Proberts</a>-designed project places its strongest emphasis at ground level, where retail, landscaping and a new cobblestone pedestrian connection would open the site to the surrounding neighbourhood. The design team describes The Silo as “more than a residential building”, positioning the development as an extension of Newstead’s public realm rather than a standalone apartment tower.

“A new cobblestone laneway and landscaped connection between James Street and Gasworks unlock a missing pedestrian link, improving walkability and stitching together two of Brisbane’s significant urban destinations,” Bureau Proberts said in its Urban Design Report.

<img alt="First look: Graya plans The Silo as new pedestrian link between James Street and Gasworks" data-entity-type="file" data-entity-uuid="0ea1b06a-75f5-40a5-b2c5-33c97bc86052" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/silo%20bldg.png?VersionId=KmjsAtNePu57_B31EM_DJ5T6KPJHtcmo" />

The Silo is planned as a mixed-use development incorporating apartments alongside a bar and centre activities including food and drink outlets, indoor sport and recreation, office and retail uses.

Architecturally, Bureau Proberts has conceived the building as a collection of vertically expressed, stepping forms rather than a single uniform tower. The composition rises from an articulated podium before being broken by a triple-height landscaped recreation level, with the upper section becoming more compact before terminating in a landscaped rooftop garden.

The project's name and architectural language draw directly from Newstead's industrial history. Patterned off-form concrete is proposed as the principal façade material, complemented by slender metal rod balustrades and extensive planting. The cylindrical and vertically ribbed elements give the building its silo-like expression, while curved balconies and planted edges introduce a softer subtropical layer.

“The Silo reinterprets its robust forms, scale and materiality through a contemporary subtropical architectural expression, creating a building that acknowledges its industrial legacy, while responding to the way the precinct is occupied today,” Bureau^Proberts said.

The recreation level is one of the defining breaks in the tower. Plans include a lap pool, mature subtropical planting and shared resident facilities within an elevated communal garden. Landscaping continues through the podium and onto the rooftop, where a further garden forms what the architects describe as a “subtropical crown” to the building.

<img alt="First look: Graya plans The Silo as new pedestrian link between James Street and Gasworks" data-entity-type="file" data-entity-uuid="f8451036-35a4-49a9-8d88-2ef4438eba3d" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Silo%20Lane.png?VersionId=h8N31_rYmCEqoNrpt4kbYVQhJGZn60LH" />

At street level, the development has been designed to establish a more permeable block. Retail and hospitality tenancies address the public realm, while landscaped pedestrian spaces lead into the new laneway connection. Renders in the design report show the proposed “Silo Lane” as a substantial opening through the podium, framed by cylindrical concrete forms with cascading planting above.

The Silo continues Graya's move into larger apartment developments after building its reputation across high-end residential projects in Brisbane and the Gold Coast.

Graya buys Frasers Newstead site, plans The Silo between James Street and Gasworks precincts

<a href="https://www.apartments.com.au/developers/wickton">Wickton</a>’s completed Linacre Rise development in Hampton is giving Bayside downsizers the opportunity to move into a spacious apartment near the beach, with the developer covering stamp duty for a limited time.

The 27-residence development has been designed for buyers who want to simplify their living arrangements without giving up the space, warmth and quality associated with a long-term family home. Most apartments have already been secured by Bayside locals, leaving a select collection of two and three-bedroom residences and penthouses available.

Two-bedroom apartments are priced from $1.275 million, three-bedroom residences from $2.25 million and penthouses from $3.375 million, with the completed homes available to inspect and move into now.

[smartcode_project:default project_id=95289 project_image_fid=366760]

<a href="https://www.apartments.com.au/buildings/linacre-rise-hampton-8-10-linacre-road-hampton-vic-3188">Linacre Rise</a> occupies an elevated position on one of <a href="https://www.apartments.com.au/developments/hampton-vic-3188">Hampton</a>’s quiet, tree-lined streets, around 250 metres from the bay and 500 metres from Hampton’s village centre. Its setting gives residents access to the beach, local cafés, shops and Hampton Train Station while retaining the feel of an established residential neighbourhood.

Architecture and interiors by <a href="https://www.apartments.com.au/architects/ewert-leaf">Ewert Leaf</a> draw on the warmth and permanence of traditional brickwork, with the building integrated into terraced landscaping by <a href="https://www.apartments.com.au/landscape-architect/john-patrick-landscape-architects">John Patrick</a>. Ground-floor apartments are elevated above the street and include private garden courtyards, while several upper-level residences have generous balconies and outlooks toward the bay.

Inside, the residences favour natural materials and generous proportions. Herringbone-pattern European oak flooring, natural stone benchtops, premium joinery and Swiss V-ZUG appliances are among the key inclusions, while integrated storage has been incorporated across kitchens, bathrooms, studies and living areas.

The kitchens have been planned as practical spaces for both everyday use and entertaining, with substantial island benches, detailed cabinetry and adjoining dining and living zones. Full-height wardrobes, plush bedroom carpeting and carefully considered lighting reinforce the residential character Wickton sought to retain for buyers moving from larger homes.

[smartcode_project:default project_id=95289 project_image_fid=366769]

A Linacre Rise purchaser said the completed apartment had delivered the space, outlook and construction quality they had been seeking.

“The unit is very light, has views to die for over the bay, all construction materials and fittings are premium quality, we have secure parking for three cars, EV charging at very competitive rates, the neighbours are friendly and there is just a lovely ambiance about the place,” the purchaser said.

Environmental features include solar panels, shared electric vehicle charging stations, rainwater harvesting for toilet flushing and landscape irrigation, double-glazed windows and water-efficient fixtures and appliances.

[smartcode_project:default project_id=95289 project_image_fid=366762]

The development was built by Balmain &amp; Co, with Wickton managing the broader development process through its in-house team.

For downsizers, the project’s completed status removes much of the uncertainty associated with buying off the plan. Purchasers can inspect the finished apartments, understand their outlook and proportions, and move in without waiting for construction to conclude.

The remaining selection includes north-oriented balconies, corner configurations and penthouses with elevated bay views. The developer-paid stamp duty initiative is available for a limited time, with potential savings of up to $200,000 depending on the residence purchased.

[smartcode_project_cta:default project_id=95289]

Limited-time stamp duty offer at completed Linacre Rise apartments in Hampton

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?

For most Australians, buying an apartment is one of the biggest financial decisions they'll ever make

The location, floorplan and price are often the first considerations, but in recent years another question has become increasingly important: who is actually delivering the project?

A series of high-profile builder collapses, construction delays and defect concerns have fundamentally changed how many Victorians approach buying off the plan. The collapse of Porter Davis in 2023, which reportedly left around 1,700 homes unfinished, became one of the most visible examples of the risks that can emerge when a construction company fails. <a href="https://www.equifax.com.au/sites/default/files/lpassets/pdf/Final-Business-Market-Pulse-June-Sector-Deep-Dive-Report-2.pdf">Similar challenges across the broader construction sector</a> have left buyers asking more questions before signing a contract.

As Victoria continues encouraging higher-density housing to address supply shortages, transparency is becoming just as important as location or price.

One tool increasingly entering the conversation is the <a href="https://icirt.com/">Independent Construction Industry Rating Tool (iCIRT)</a>, an independent assessment framework designed to help buyers better understand the developer or builder behind a project. Originally developed by Equifax in consultation with government and industry as part of NSW's Construct NSW reforms, the system has since expanded nationally.

<h2 data-end="1519" data-section-id="7nmx3" data-start="1492">What is an iCIRT rating?</h2>

Most Australians are familiar with independent ratings in everyday life.

We compare ANCAP safety ratings before buying a car. We look at Health Star Ratings in supermarkets. Banks rely on credit assessments when lending money.

Until recently, however, there has been very little independent information available to help apartment buyers assess the business responsible for delivering a residential project.

That gap is what iCIRT was designed to address.

Builders, developers and other construction professionals with an iCIRT rating have demonstrated high-trust characteristics through an independent, evidence-based assessment across six criteria: Character, Capability, Conduct, Capacity, Capital and Counterparties. This involves a rigorous review of financial health, past project track record, and ethical conduct. Crucially, an iCIRT rating could help provide property buyers with confidence that they are working with a professional who has demonstrated the capability, capacity, and willingness to return and rectify issues.

Importantly, iCIRT is not a recommendation to purchase a particular property, nor is it a traditional credit rating. It is an independent assessment framework designed to provide objective information about a construction business using a <a href="https://icirt.com/sites/default/files/2025-08/iCIRT-Methodology-Issue1-May-2021.pdf">published methodology</a>.

The system has been widely adopted in New South Wales, where more than one-third of medium and large residential builders and developers now hold an iCIRT rating, representing over two-thirds of the state's residential building market by value as of 2025/26.

<h2 data-end="3126" data-section-id="h6ohtj" data-start="3084">Why buyers are doing more due diligence</h2>

For many buyers, particularly those purchasing off the plan, the biggest risk isn't whether they'll like the kitchen finishes.

It's whether the project will be delivered on time, to the expected quality, and by a company capable of completing the development.

<a href="https://icirt.com/sites/default/files/2026-07/iCIRT%202025%20Consumer%20Survey%20Report%20v05.pdf">Consumer research commissioned by iCIRT</a> found more than half of respondents believed current protections do not adequately safeguard buyers from builder insolvencies or defective projects. Other research found 88 per cent of prospective buyers would seek independent ratings or due diligence before purchasing, while 90 per cent said trust in construction professionals is essential.

That doesn't mean buyers should rely on a single rating alone.

Independent legal advice, understanding the contract, and seeking financial advice all remain important parts of the due diligence process.

However, an independent assessment can provide another source of information alongside those traditional checks.

<h2 data-end="4138" data-section-id="pquzxc" data-start="4094">Trust is becoming a competitive advantage</h2>

The conversation isn't only changing for buyers.

Developers are also recognising that trust has become an increasingly important part of the sales process.

Five years ago, purchasers typically asked about floorplans, finishes and settlement dates.

Today, sales teams are increasingly being asked about the developer's experience, financial stability, previous projects and construction partners.

For companies with strong governance and established delivery records, an independent iCIRT rating provides another way to demonstrate those credentials before buyers even visit a display suite.

According to Equifax, the assessment can also help businesses drive sales and <a href="https://icirt.com/resources-for-business/icirt-rating-helps-scion-secure-high-value-projects">secure high-value projects</a>, as well as identify operational improvements and <a href="https://icirt.com/resources-for-business/mirvac-reinforces-brand-trust-and-quality-independent-icirt-rating">attract top talent</a>.

<h2 data-end="4962" data-section-id="1j54ng5" data-start="4912">Beyond buyers: lenders are paying attention too</h2>

The influence of independent construction ratings is also extending beyond consumers.

According to Stamford Capital's Real Estate Debt Capital Markets Survey, an increasing number of lenders now incorporate iCIRT ratings into their due diligence processes when assessing residential development finance applications.

The survey found lender adoption has continued to rise, with many respondents saying independent assessments provide additional insight into governance, counterparties and delivery capability beyond traditional financial analysis. Some lenders also reported declining funding applications where businesses had poor or no ratings.

As construction costs remain elevated and access to development finance becomes more selective, demonstrating credibility is becoming increasingly valuable.

<h2 data-end="5801" data-section-id="1qazuxs" data-start="5772">What it means for Victoria</h2>

Victoria's apartment market is entering a new phase.

The state is seeking to accelerate higher-density housing while simultaneously introducing reforms aimed at improving confidence in residential construction.

For buyers, that means there are more tools available than ever before to research the businesses behind a project.

For developers, it signals that transparency is becoming another point of differentiation in an increasingly competitive market.

Buyers are asking more questions than ever before and increasingly expecting independent information, not just marketing material, before making one of the biggest financial commitments of their lives.

Find out how to get iCIRT rated <a href="https://www.icirt.com/sites/default/files/2025-08/iCIRT-Infographic-Assessment-Process-Final.pdf">here</a>.

<hr data-end="6469" data-start="6466" />
The information contained in this article is general in nature and does not constitute personal, financial, legal or tax advice. It does not take into account your personal objectives, financial situation or needs. Therefore, you should consider whether the information is appropriate to your circumstances before acting on it and, where appropriate, seek independent professional advice.

This article contains links to third-party websites. These links are provided for convenience only. Equifax Australia does not control and is not responsible for the content, accuracy or privacy practices of external sites.

Copyright © 2026 Equifax Australia Information Services and Solutions Pty Ltd. All rights reserved.

Buying off-the-plan in Melbourne? How independent iCIRT ratings are set to change Victorian property

<html><body><div class="post-content">
It was with great interest that I read the minutes of the Reserve Bank of Australia’s (RBA) March meeting where the Head Teller Glenn Stevens noted somewhat nonchalantly that housing market conditions “do not pose a near-term risk” and that <a href="/expert-insights/rba-relaxed-about-the-dollar-and-investment">there is “no immediate cause for concern”</a> with regard to debt levels.
No mention of those ‘bubble and boom’ headlines that dictate newspapers although it should be noted that both Fairfax and News Ltd prosper very well financially by enticing vendors to get on the market and spend, spend, spend in their respective newspaper real estate platforms.
There are no doubts that Australia’s real estate markets, aside from being right up there as being the most expensive and unaffordable, are right up there for glamour appeal as well as outstanding performance. The RBA is closely monitoring how the many niche markets are performing and would have a wry smile that the cash rate has more than done its job to the extent that the next move (probably in August) will be up. Already we are seeing <a href="/expert-insights/finance/economists-predict-interest-rates-will-hit-4-25-by-end-of-2015-but-are-these-projections-likely">predictions of 4.50% by mid–2015</a>.
<blockquote>
Historically, when the Mosman housing market breaks the one billion dollar mark in a calendar year it is the strongest sign that the markets are doing exceptionally well.
</blockquote>
The Mosman house market is easily one of the most observed on the property catwalk and the RBA would be most happy how it is performing when comparing results from 2006 to 2013.
<ul>
<li>2006 Number of Houses Sold 366 for a total value of $932,663,130</li>
<li>2007 Number of Houses Sold 373 for a total value of $1,130,325,667</li>
<li>2008 Number of Houses Sold 247 for a total value of $702,311,112 – GFC</li>
<li>2009 Number of Houses Sold 278 for a total value of $732,986,251 – GFC</li>
<li>2010 Number of Houses Sold 317 for a total value of $900,728,149 – GFC</li>
<li>2011 Number of Houses Sold 270 for a total value of $777,349,292</li>
<li>2012 Number of Houses Sold 284 for a total value of $789,400,700</li>
<li>2013 Number of Houses Sold 366 for a total value of $1,022,005,721*</li>
</ul>
*This figure will rise significantly higher given a number of top end properties sold late in 2013 with long settlement periods.
Source: Australian Property Monitors
Historically, when the Mosman housing market breaks the one billion dollar mark in a calendar year it is the strongest sign that the markets are doing exceptionally well.
Prior to the GFC in 2007 the Mosman market was performing at its highest level so it should come as little surprise that in 2013 it was close to 2007 levels and 2014 should see the markets hit well in excess of $1.2 billion in turnover.
Another interesting point is that Mosman has approximately 4,800 houses so when the market is on it trades at close to 10% per annum and when the market is down it drops down to 5%. So when you look at how the property markets are performing currently it is <a href="https://www.businessspectator.com.au/article/2014/3/19/economy/rba-steps-towards-housing-policy-highwire" target="_blank">very clear that now the RBA will step in</a> – attempting to steer consumer sentiment into calmer waters. 
Housing accounts for over 60% of household wealth and this is now valued at over $5 trillion – which is more than three times nominal GDP. This is where it gets very difficult for the RBA given our banks have a massive exposure to our housing markets, and state governments on the other hand are high dependent stamp duty recipients.
<div class="graph-image">
<div><img src="https://www.alankohler.com.au/sites/default/files/styles/ak_graph/public/kohlersgraphs/2014/Mar/wisest-place.png?itok=EbfZxT6n" alt="" width="296" height="286"></div>
</div>
Source: Westpac/Melbourne Institute/<a href="https://www.alankohler.com.au/" target="_blank" title="Alan Kohler Graphs" style="line-height: 1.3em;">Alan Kohler Graphs</a>
Yesterday the government announced its Terms of Reference for the Inquiry into foreign investment into Australian real estate markets. I thought Digital Finance Analytics raised some very interesting points on where this Inquiry already fails given the focus is on the Foreign Investment Review Board – when many of the overseas buyers simply skip the FIRB process and transfer funds to an Australian resident who then just purchases the property in their name. When the party who transfers the funds obtains Australian residency they then pay the stamp duty to transfer the subject property into their name. This rort has been going on for years and again this Inquiry has missed this loophole completely.
This leads me to think that quite possibly they don’t even know this is happening.
</div></body></html>

robertsimeon-hRNTwJyXkQ

The property numbers that really count: Mosman a good indicator of property market strength

<html><body>
Toby Johnstone wrote in the Sydney Morning Herald back in January 2014 that "investors' love affair with Sydney's property market could be over, with experts anticipating a slowdown in property speculation." 
"All the pointers are there showing that the Sydney investor market has overshot its fundamentals," the article quoted Andrew Wilson, the senior economist at Australian Property Monitors.
In the same piece, RP Data senior research analyst Cameron Kusher agreed, saying, "investors thinking of getting into the market had missed the boat. Whether you are chasing capital growth or rental return, neither look particularly strong at the moment certainly not as strong as 12 to 18 months ago. Given that, I do think that we will see a pullback in investor activity this year."
So what do you think? 
Recently I came across a graph (pictured below) that tracked both property growth over a long period of time but also identified yearly rates of change in property values. What's interesting about the graph below is that it shows where we are in the property cycle. 
 <img src="/images/stories/2014/03/14/chan%20march%2014%20one.png" alt="">
Source: Jon Giaan
The blue line shows property values but the orange line shows the actual change in property values year on year, and this is much more relevant in terms of determining when to get into the market and whether the market has run out of steam. 
You can see clearly that the market goes through many years with increasing annual growth rates and then reducing annual growth rates until finally several years of increasing negative annual growth rates before repeating itself. 
<blockquote>
There are several more years of increasing yearly growth rates before the yearly growth rates start to taper off. 
</blockquote>
The green line shows the current trend is upward in nature and, if history this will go on for a few years before the growth rate tapers off year on year until negative growth. 
You can see the positive yearly growth years are much more than the yearly negative growth years and that is why the blue line shows the property market trending upwards over the longer term. 
This also demonstrates that there are several more years of increasing yearly growth rates before the yearly growth rates start to taper off. 
In other words, if last year’s growth was 9.14%, and if the graph is right, we should get double digit growth rates this year and the next year an even higher rate. After that the yearly growth rates, whilst still positive, will be a lower rate year on year until it becomes negative. 
The reason for this is because of human nature. 
People are broken into four groups:
<ol>
<li>Early adopters</li>
<li>Middle adopters</li>
<li>Late adopters </li>
<li>Never adopters </li>
</ol>
The majority of people are middle to late adopters and they tend to create the momentum that is typical of property cycles. 
When the conditions first begin to change for property the early adopters get in first but the majority of people sit back waiting for more certainty and more people to invest. Hence the saying "the majority of people are like sheep".
In the meanwhile, if conditions change early adopters are also the first to get out (sometimes prematurely) but the middle adopters are still just getting in and this creates the momentum that shows up in the graphs as continuing forward momentum. 
This is than added to by the late adopters who are now just getting in, thus providing the "braking" effect to a plummeting of the annual growth rate. This gives the wave pattern we see in orange. 
If you believe the historic property cycle will repeat itself, then this graph demonstrates that the momentum has started to build, the middle adopters are still getting in the market and we are not as yet at the top of the yearly growth rate cycle.
Whilst there are no guarantees, the graph seems to indicate we are still on the upward path and we have not yet started to experience reducing growth rates which would normally run for several more years before we experience negative yearly growth rates. 
</body></html>

echan-hSGJw4wwC5

Is it the time to get into property?

<html><body>
I'm wondering why Australians only protest about foreign investors when they're Asian.
Overseas investors have been buying our real estate in significant amounts for many decades, headed by buyers from the UK, the US and Europe.
It's become a source of outcry only twice in my lifetime: in the 1980s when the Japanese were doing it, and now with the rise of buyers from China.
In both instances, the extent and the impact of this foreign investment has been greatly over-stated. And the concern expressed about foreign investment has focused exclusively on the Asian buyers with little or no angst about buying of equal magnitude from other sources.
In the 1980s I was a specialist property writer working for the Courier Mail and later the Australian Financial Review. I remember being stunned at the outrage about Japanese investors buying in Queensland, although their ownership was but a drop in a very large pond and mostly focused on tourist accommodation. There were overtones of WW2 animosity amid claims of an invasion by financial stealth.
<blockquote>
In terms of Australian families buying homes, the impact of Chinese investment is near zero.
</blockquote>
None of the horrors imagined by the xenophobes came to pass and eventually it all faded away.
Now it's being whipped again, with China the target of people with a skinhead view of current affairs.
The strange thing is that the Americans were the largest foreign buyers of Australian real estate until recently. The Chinese have only recently overtaken them, more because of a decline in US investment than a rise in Chinese buying. I can't recall any outcry, not a murmur, about Americans dominating our real estate markets, pushing up values and pricing our kids out of home ownership.
But now the Chinese are being accused of all these things. Every time someone of Asian appearance is the successful bidder at a Sydney auction, it will be cited by someone with a room temperature IQ as evidence of the Chinese invasion and the death of The Great Australian Dream. The buyer could be a fourth generation Australian for all they know.
We even had a sad instance recently of a supposedly credible entity, Credit Suisse, stooping low enough to claim that a whole generation of young Australians was being priced out of the market by the Chinese, doomed to rent forever. The authors of that "report" should be ashamed of this irresponsible and unethical claim, inspired by nothing more than a desire for cheap publicity.
The notion is farcical. Foreign investors, Chinese or otherwise, do not operate in the same space as first home buyers. They have to buy new, so they focus mainly on off the plan apartments in the inner city areas of Sydney and Melbourne, as well as the Gold Coast. As a percentage of the total Australian real estate market, their buying is miniscule.
They're not scouring Blacktown or Frankston for existing houses, which is what 85% of first home buyers opt for.
In terms of Australian families buying homes, the impact of Chinese investment is near zero.
But now, quite incredibly, we are <a href="https://www.propertyobserver.com.au/https://www.abc.net.au/news/2014-03-19/australian-parliament-releases-terms-of-reference-for-foreign-p/5331674" target="_blank">going to have a parliamentary inquiry</a>. Such is the hysteria whipped up by unethical journalists, our politicians have bowed to the mob and brought on a witch hunt.
We really are a nation of wankers when we behave like this. 
So what will be the outcome, I wonder. Will we ban foreigners from buying our real estate? Or will we ban the Chinese only?
And what about the resources sector? Every major resources project in Australia (most of them gas projects) is dominated by foreign investors. To be consistent, how about we ban them as well?
Given that there's barely a dollar of Australian money in any of these projects, that would effectively shut down the mining industry.
</body></html>

terryryder-YECXbqmri2

Why do Australians only protest foreign buyers if they're Asian?

<html><body>
You can't escape gravity
In economics, interest rates act a little like gravity.
Any change in interest rates, anywhere in the world, changes the values of financial assets.
Of course, this is blindingly obvious when you are looking at bond prices shifting, but the rule also applies to all other classes of financial assets, including equities, farmland, commercial or residential real estate or commodities.
Simply put, if interest rates are at 10% then the present value of a dollar you receive on any investment is much lower than when interest rates are at 2.50%.
Evidence?
Interest rates impact financial markets.
Famously, Buffett provided the empirical evidence for this in a speech in 2001.
<blockquote>
Successful investment is not about luck. It is about patience and discipline. 
</blockquote>
He noted that in the 17 years between December 1964 and December 1981, the US Gross National Product (GNP) increased by a whopping 373%, yet the Dow Jones index essentially went absolutely nowhere, from 874.12 to 875.00.
A major driver for this was that long-term bond rates ran from 4.20% in 1964 to a painful 13.65% by 1981.
In the next 17 years from December 1981 to December 1998, GNP in the US only increased by less than half as much at 177%, yet the Dow Jones went on a bonanza run from 875 to 9,181.43, a staggering increase.
Why? Largely because interest rates altered the landscape for financial assets by falling from 13.65% to 5.09%, and this changed the way people invested their money.
We're seeing it happen again now, with rock bottom interest rates in the US firing the Dow from below 7,000 to well above 16,000 since the financial crisis.
A decade of low rates
You didn't have to be a genius, then, to work out that very low interest rates across the globe would cause a shift in the way people invest their money.
Below I've charted the rates trend in Australia, the US, the United Kingdom, the Eurozone and Japan from 1990 until today (click chart).
<a href="https://1.bp.blogspot.com/-7myaxZd7aE4/Uy6adQeyaRI/AAAAAAAAMBc/ybl-cQ2v-Dc/s1600/IR+history.jpg"><img src="https://1.bp.blogspot.com/-7myaxZd7aE4/Uy6adQeyaRI/AAAAAAAAMBc/ybl-cQ2v-Dc/s1600/IR+history.jpg" width="460" height="182"></a>
The thing about money is that there is an awful lot of it around the world and all of it has to find a home. 
Here are the six of the main places people might choose to put their money.
<ol>
<li>
Cash/fixed interest  Lending investments range all the way from cash in your bank account, to term deposits, government bonds, inflation-linked bonds, corporate bonds, notes, debentures, or hybrid investments, subordinated debt, and a stack of other stuff.  The basically principle is that the lending of money is exchanged for interest payments.  Clearly with interest rates at historic lows, fixed interest returns are presently very low. High yields are generally only obtained from low grade or perceived riskier investments. As a result, lending investments are far less popular than they have been and this is seeing a huge shift of global capital towards other asset classes, in particular... 
</li>
<li>
Equities  When my first book Get a Financial Grip was published, I put forward the opinion that if financial freedom is your goal, then the best means of achieving it for the average investor in Australia could be (1) to get broad exposure to Sydney real estate for the long term, (2) to continue building a diversified portfolio of dividend-paying equities, and (3) keep a very healthy cash buffer.  For long-term investors, assets which bring income and the potential for capital growth tend to beat the cash/fixed interest investments. Buffett stated that only certain asset classes fulfill these criteria from his perspective: profitable businesses, equities and real estate. I noted that my suggestions were particularly so given the low interest rate environment (which would likely see funds flowing away from cash and fixed interest and into share markets).  Low interest rates have been very kind to share markets in Australia, while investors continue to derive annual benefit from tax-favoured dividends.  <img src="https://hfgapps.hubb.com/asxtools/imageChart.axd?s=xjo&amp;pi=Index&amp;ct=3&amp;tf=M2&amp;ovs=&amp;si=Code%20not%20supplied&amp;tima1=0&amp;tima2=0&amp;bi=2&amp;bima=0&amp;comt=index&amp;ds=xjo&amp;dovs=0&amp;ex=ASX&amp;ex2=ASX&amp;val=1&amp;stmp=20140323200148882" width="400" height="275" style="line-height: 1.3em;">  Source: ASX  
</li>
<li>
Real estate  Even last year people were still arguing that housing markets aren't interest rate sensitive.  Questioning the effectiveness of monetary policy tends to be a part of every economic cycle, but monetary policy generally does work and, like all financial assets, housing markets are ultimately sensitive to changes in the cost of capital. What may have wrong-footed commentators is the tendency for a lag effect, with the full impact of interest rate cuts on occasions taking up to 18 months to be seen in full.  A dramatic turnaround in the tenor of online comments from schadenfreude to snarky is a fairly reliable indicator of the property markets having moved into a new phase. The chart below shows what has happened since the most recent trough in mid-2012 which includes a very strong rebound in Sydney and Melbourne (click chart). <a href="https://1.bp.blogspot.com/-VfzBwYegFXk/Uy9rx9D7E_I/AAAAAAAAMCI/KKaAduw974w/s1600/RPD.jpg" style="line-height: 1.3em;"><img src="https://1.bp.blogspot.com/-VfzBwYegFXk/Uy9rx9D7E_I/AAAAAAAAMCI/KKaAduw974w/s1600/RPD.jpg" width="400" height="156"> </a>
</li>
<li>
Commodities The most popular for average investors are gold and silver, which don't pay yield but can represent a hedge with a portion of a portfolio.  It's been a rollercoaster ride for the precious metals over the last year or two. Who knows where to next?  <img src="https://www.kitco.com/LFgif/au3650nyb.gif" style="line-height: 1.3em;"> Buffett sees gold as a barren asset, since it pays no yield.  In 2011, he drew the analogy that the world's gold stock of 170,000 tons (about 68 square feet) had a total valuation at $9.6 trillion or $1,750/oz of all the cropland in the US, plus 16 Exxon Mobils (the world's most profitable company in 2011, generating net profits of $40 billion annually) and around $1 trillion of walking around money.  The price of gold tends to peak at times of fear and so can represent a worthwhile hedge for some investors with part of their portfolio.  Buffett's main gripe is that if you hold a bar of gold for 50 years, at the end of the process you still have a gold bar, and it still pays no income - thus, you are hoping for more speculators to push up the price in times of fear. 
</li>
<li>
Collectables Investing in collectables such as art or antique coins tends to be handy...for experts. 
</li>
<li>
Get rich quick schemes There have been a lot of these over the years, from pyramid schemes to exotic new diamond mines and emu farms.  Get rich quick schemes tend to be suitable for people who have some money and want to rid themselves of it quickly.
</li>
</ol>
Article continues on next page. Please click below. 
<hr class="system-pagebreak">
Four rules for investing
Rule one - Diversify
Don't put all your eggs in one basket - you should have your business, property, shares and cash.
It's easy enough to get diversification in the share markets through using Listed Investment Companies (LICs) or index funds, but one of the problems with real estate is that the leverage involved sees you quickly gain exposure to only a handful of correlated assets in one asset class.
For this reason, while it's not for everyone, I invest heavily in UK property too.
The beacon of truth that is the Daily Mail <a href="https://www.dailymail.co.uk/news/article-2586619/Its-housing-hysteria-Eight-buyers-chasing-home-prices-50-000-month-property-market-reaching-new-levels-insanity" target="_blank" style="line-height: 1.3em;">reported over the weekend</a> that house prices in Britain had increased by as much as £50,000 to £100,000 in only one month, particularly in London and the south-east.
While I don't believe everything I read in the Daily Mail, as an active participant in the London market, I can tell you that well-located and in demand property may easily have seen a 5-10% price uplift in recent months. 
In a separate article, <a href="https://www.dailymail.co.uk/news/article-2586692/House-prices-set-soar-30-savers-raid-pension-funds-invest-property" target="_blank" style="line-height: 1.3em;">the Mail also reported that</a> a surge of investors using their savings and retirement funds could push UK house prices up by 30%. Why? Because the UK's zero interest rate policy (ZIRP) has crucified the value of annuities.
Just like gravity, you can't get away from interest rates. 
Rule two - Investment is not about luck 
Successful investment is not about luck. It is about patience and discipline. 
Rule three - Markets are cyclical
In every cycle, people argue that this time will be different. But corrections follow booms and markets slump before booming again. Cycles continue. 
Investors need to have an awareness of whether asset prices are near their peak or nadir and plan accordingly.
Rule four - No free lunches
Very high returns tend to be achieved through risky ventures. If something sounds too good to be true, it probably is.  
This is true in bonds where high yields often come with a high risk. In equities, the opportunuity for coubling your money quickly tends to come with an equivalent chance of halving it (or worse). And high yields in residential real estate are frequently found in. 
When it comes to property, my view has always been while you may certainly start small, you ultimately need to play in a big pond. 
Just like Buffett's point on barren assets - if you invest in a cheap property in a cheap location, then at the end of the process you will still have a cheap property in a cheap location, and the returns adjusted for inflation will likely be lacklustre. 
That's why I've tended to look for properties with an 'X factor' that will be in demand for decades to come, such as properties close to the City of London, or in Australia located in Bondi, or on the Sydney harbourside. 
</body></html>

pwargent-M4siyDbqQY

Six places to invest money and four rules for doing so

<html><body>
The fight is on over the Abbott government’s push to unwind Labor’s Future of Financial Advice reforms.
<a href="https://www.smartcompany.com.au/finance/30625-government-tweaks-fofa-reforms-on--conflicted-remuneration" target="_blank">The FoFA reforms</a> initially set out to ban commissions for financial advice, require financial advisers to ask clients whether they wish to continue receiving their service every two years and require financial advisers to act in the best interests of their clients.
But led by former assistant treasurer Arthur Sinodinos, the Abbott government moved to <a href="https://www.smartcompany.com.au/legal/35388-burdensome-financial-advice-reforms-watered-down" target="_blank">water down the “burdensome” reforms</a> and announced many of the changes will be made by regulation not legislation, meaning there will be no scrutiny by a parliamentary committee.
The key amendments under FoFA now include removing the opt-in requirement, streamlining the annual fee disclosure requirements, amending the best interests duty to allow for scaled advice, exempting general advice from conflicted remuneration and amending grandfathering to allow for adviser movements.
It’s now open slather with the sudden resignation of Sinodinos and the fight is on as to whether companies should be free to motivate employees offering consumers general product information with commissions and bonuses to maximise sales. 
Finance Minister, Mathias Cormann, is now back in the driver’s seat and he has made it clear he believes an effective ban on incentivising employees to provide basic general advice is “just ridiculous”.
The political wrangling means that FoFA’s guiding principle of bringing clarity to financial service clients appears to have been lost.
The financial services industry has been preparing for the FoFA reforms for a long time and the constant changes are just adding to the uncertainty.
For the more forward thinking members of the industry it should be abundantly clear that commissions and financial advice ‘fees’ of which clients are unaware of need to come to an end.
Requiring financial advisers to act in the best interests of their clients should be standard, not controversial.
Cara Waters is editor of <a href="https://www.SmartCompany.com.au" target="_blank">SmartCompany</a>.
This article first appeared on <a href="https://www.SmartCompany.com.au" target="_blank">SmartCompany</a>.
</body></html>

cwaters-YrtBR88nBe

Why we need to make a fuss about FoFA

<html><body>
Located on Lees Road, Robertson, just off of Jamberoo Mountain Road, is Temenos. The name, which means “sacred space”, is apt for this 220 acre offering with multiple uses that the listing believes an entrepreneur will snap up.
The <a href="https://www.propertyobserver.com.au/https://www.mcgrath.com.au/buy/acreage-rural-robertson-nsw-2577/208107" target="_blank">multi-use site has views of the ocean, lake and escarpment</a> from Botany Bay to Shellharbour.
<img src="/images/2014/03/24/2.jpg" alt="">
It offers two irrigation licences, six natural springs on the property, a mineral water licence and a DA for a water bottling facility on the site. It also mentions that since July 2011 the government is not issuing any more water licences. The water has just 68 Total Dissolved Solids and no coliforms, bacteria, arsenic, nitrates, suphates, which is said to be a rarity.
The site also has tourism opportunities, with the start of the historic Butter Track beginning at the property’s northern end. Jamberoo was home to Australia’s first butter co-operative factory, which opened in 1884.
<img src="/images/2014/03/24/3.jpg" alt="">
The land, 750 metres above sea level, is located near six national parks and six waterfalls, and the suggestion is for eco-cabins or glamourised camping. The site comes with an American barn and hut.
The site could also be used for potato growing, truffles and as grazing land, with red basalt soil striking across the property.
<img src="/images/2014/03/24/4.jpg" alt="">
On the market with McGrath, Bowral, it is asking for expressions for interest by close 5pm 17 April, with a price guide of over $4.5 million.
<img src="/images/2014/03/24/5.jpg" alt="">
Meanwhile, <a href="https://www.realestate.com.au/property-acreage+semi+rural-nsw-robertson-115679387" target="_blank">93 acre Misty Ridge Farm is listed</a> for $2,950,000 at 170 Lees Road (pictured below). The cattle grazing, horse-appropriate property includes 11 paddocks, eight dams and sheds for farming and livestock use. Accommodation includes two houses, with six-bedrooms and two-bathrooms in total, with wood fires, solar power and air conditioning, as well as a six car space car port. There is also a 12 by six metre swimming pool.
<img src="/images/2014/03/24/robertson%20march%2024%20two.jpg" alt="">
</body></html>

jduke-EHk3XBmHkn

"Sacred" 220 acre space in Jamberoo advertised for entrepreneurial buyers

<html><body>
A weekend of high auction clearance rates bodes well for the three weeks leading to Easter, Australian Property Monitors senior economist Andrew Wilson says.
Auction clearance rates in Sydney were at 81.5 %, <a href="https://www.smartcompany.com.au/finance/investment/36045-sydney-property-accelerates-and-melbourne-keeps-moving-despite-grand-prix" target="_blank">up from 77.9 % last week</a>, with 682 listings. The median price for houses was $1,025,550 while the median price for apartments was $729,000.
This result was well up on the average prices for the same weekend last year, with Sydney houses at $930,000 and apartments $644,000.
“We are seeing real energy in the prestige market in Sydney,” Wilson told SmartCompany.
“Twenty properties in Sydney sold for over $2 million.”
He says the inner suburbs of Sydney, the lower North Shore and Northern Beaches showed solid results.
“Next weekend in Sydney we have over 800 auctions listed… as people take advantage of the market before Easter and the winter weather,” he says.
In Melbourne the clearance rate for auctions was 73.1 %, up from 69.8 % last week, with 971 properties listed.
The median auction sale price for houses was $760,000, while the median auction sale price for apartments was $528,500.
Wilson says around 1,200 properties are listed for auction in the Melbourne metro market next weekend. He says the market in Melbourne is “solid” not “strong” but doing well despite the high February unemployment rate for Melbourne of 7.3%.
In Adelaide, the clearance rate was 62.1 % with 45 houses listed, and in Brisbane it was 63.6 % with 77 houses listed.
The most expensive property sold at auction in Sydney was a five-bedroom house in Mosman (pictured above), for $5.7 million. In Melbourne it was a five-bedroom home in Canterbury for $3,125,000.
The most affordable property in Sydney was a two-bedroom townhouse in Lakemba for $416,000. In Melbourne it was a one-bedroom unit in Maribyrnong for $230,000.
This article first appeared on <a href="https://www.SmartCompany.com.au" target="_blank">SmartCompany</a>.
Australian Property Monitors (APM) has released a list of results from 367 auctions in Sydney for the weekend of March 22.
<a href="https://www.homepriceguide.com.au/saturday_auction_results/Sydney.pdf" target="_blank" rel="nofollow">Click here</a> for the auction results, and click on each street address to see the property's marketing.
<a href="https://www.homepriceguide.com.au/saturday_auction_results/Melbourne.pdf" target="_blank" rel="nofollow">Click here</a> for the list of results from 689 auctions in Melbourne.
<a href="https://www.homepriceguide.com.au/saturday_auction_results/Brisbane.pdf" target="_blank" rel="nofollow">Click here</a> for the list of auction results in Brisbane.
<a href="https://www.homepriceguide.com.au/saturday_auction_results/Adelaide.pdf" target="_blank" rel="nofollow">Click here</a> for the list of auction results in Adelaide.
</body></html>

moliver-7qYWqnHmyR

Property set to heat up prior to Easter with 20 homes over $2 million sold in Sydney

<html><body>
Approaching the Albert Park site of The Block: Fans v Faves on open for inspection weekend, one is reminded that for all the tears and tantrums, the show is still a commercial exercise. 
Blocks away, sponsor merchandise could be seen adorning the punters streaming from O’Grady Street; this reporter copped more than one advertiser-distributed helium balloon to the face on her way to the apartment complex. Even the neighbours got in on the action, with several garage sales ensnaring fans of the show in transit.
Continuing into the building, crowds are funnelled past the ground floor communal pool and recreation space, which was closed off from the public. A peek through the privacy screens established that the space was surprisingly large and well planned – the communal area will afford the future residents plenty of their own space.
On to the apartments: at this point it must be noted that the crowd control staff were exceptional, funnelling punters through with impressive efficiency and professionalism. 
First stop, Kyal and Kara’s apartment.
Kyal and Kara: <a href="https://www.realestate.com.au/property-apartment-vic-albert+park-116390163" target="_blank">2/47 O’Grady Street</a>
In the wide gallery-style hallway of Kyal and Kara’s apartment, one can understand the judges' praise of the couple’s entranceway. While not quite <a href="https://www.archdaily.com/226316/tadao-ando-architecture-exhibition/" target="_blank">Tadao Ando’s Benesse House</a>, the setting of Ali McNabney Stevens prints against the concrete walls is just the ticket for a crowd-exhausted visitor – the artwork looks beautiful, and the space (and viewer's mood) is elevated.
<img src="/images/2014/03/24/kkh2r6livingdining04.jpg" width="460" height="259">
Entering the living areas, the judges' words again ring true – the space feels surprisingly small. It’s an intimate lower level, better suited for a young couple having a few friends over for some wine and movies than a big party. The outdoor terrace, with its plant wall, makes the space feel like a private retreat. Though the living and dining area’s size lost the couple points on the show, a quiet sanctuary isn’t so bad – but buyers may not agree.
A very slow ascent up the stairs, enforced by the number of other viewers, allows one to appreciate the timber walling that stretches from the first level all the way to the roof, a space that isn’t used to such great affect by all the teams. 
Throughout the apartment, I am consistently impressed with the team’s styling efforts. Though in some rooms they show a disappointing amount of restraint (such as in their master bedroom), Kyal and Kara, along with Steve and Chantelle, have the most audacious use of colour – perhaps the boldness of youth.
<img src="/images/2014/03/24/resizer%201.jpg" width="460" height="258">
However, travelling from room to room, I am puzzled by the choice to litter bedside tables and bathroom counters with bottles of Nature’s Own supplements. Who is their target buyer – vivacious but vitamin deficient young professionals? Embarrassingly, it isn’t until the same is witnessed in Brad and Dale’s apartment that the penny drops – of course, Nature’s Own is a sponsor.
Brad and Dale: <a href="https://www.domain.com.au/property/for-sale/townhouse/vic/albert-park/?adid=2011038525" target="_blank">4/47 O’Grady Street</a>
Wandering from Kyal and Kara’s rooftop terrace to Brad and Dale’s, the first couple’s outdoor entertaining area shines. The spaces are yet to be seen on television, so viewers will make up their own minds, but Kyal and Kara’s aforementioned use of colour, along with their luxurious amenities (marble benchtops in a rooftop terrace?) make their top level a stand out. 
That said, size does matter. The wet/dry bathroom/bedroom move that the boys pulled this week was indisputably a success. Among the crowd yesterday, there were more than a few “wows” and one whistle upon entrance to the master bedroom, which served as a master class on how to create space. Floor to ceiling windows on two sides of the bedroom and in the en suite reflect light along the light coloured tiles, illuminating the rooms and creating a sense of light and freedom – no mean feat when there are more than a dozen other people in the same space.
<img src="/images/2014/03/24/7bdh4r7masterbedensuite.jpg" width="460" height="259">
The boys know what they’re doing when it comes to expanding areas, rather than closing them in. Beyond the “Bond style” hidden closet in their walk in wardrobe, there are storage recesses everywhere and nary a shelf to be seen. 
Downstairs, Brad and Dale’s living area shows continues to show the boys are clever planners. They swapped out their much maligned tiny dining room table for a six seater, making a decently sized dining and entertaining area. The kitchen is nowhere near as bad as the judges made out in their review, and actually seemed quite the crowd pleaser – however, ditching the 90s style white leather and chrome bar stools would go a long way to soften the space.
 <img src="/images/2014/03/24/resizer%202.jpg" width="460" height="258">
<hr class="system-pagebreak">
Steve and Chantelle: <a href="https://www.domain.com.au/property/for-sale/apartment-unit-flat/vic/albert-park/?adid=2011049155" target="_blank">1/47 O’Grady Street</a>
Onward we are ushered to Steve and Chantelle’s apartment. As the property’s agent David Wood noted last week, the couple’s living and dining area is a stand out. It immediately speaks for itself as a space for a family that likes to entertain, with bench seating along the walls and a dining area that is tucked into a booth, leaving plenty of room for the living areas.
<img src="/images/2014/03/24/csh1r6livingdining03.jpg" width="460" height="259">
This reporter will admit to being skeptical about the team’s styling credentials in the past – on television, their choices have read a little too self-consciously “quirky” and immature for their intended buyers to really hold on to. However, upon entering their apartment, it must be said that there is substance anchoring the couple’s style.
While all Chantelle’s references do get muddled at times (the sunny 50s feel in the kitchen jars a little with the modernist 60s style in the lounge), in general the apartment pulls off pastiche with aplomb. However, the old kerosene lamps filled with fairy lights suspended with a vintage ladder will be a bit much for even the greatest Etsy enthusiast. And the pillow printed with a black and white photo of an indigenous American man as a throwaway reference in their vaguely Aztec themed second bedroom is in poor taste. When it comes to pillows, better to stick to the Hermès.
<img src="/images/2014/03/24/resizer%203.jpg" width="460" height="258">
That said, this is the first apartment of the four that feels truly lived in and liveable. The barn door, comprising almost an entire wall of their ground floor guest room, is another savvy planning decision – when closed, it’s a terrific design feature, and when open, it opens up the room as another expansion on the entertaining space. The team seems to have really understood the importance of a good party area for a luxury buyer than aspires to entertain, and that for buyers, it's all about making a first good impression.
In regards to living areas, the couple has flipped Kyal and Kara’s method; their ground floor space is made for many, where Kyal and Kara’s is a quiet retreat. Steve and Chantelle’s rooftop terrace is intimate, with a (frankly massive) day bed set in the northern corner for a couple to enjoy the sunset and city views, while the Ks have set their challenge winning dining table along with ample bench seating up top, to accommodate a big BBQ.
Alisa and Lysandra: <a href="https://www.realestate.com.au/property-apartment-vic-albert+park-116350463" target="_blank">3/47 O’Grady Street</a>
While on the day viewers are ushered from the top of the twins’ property down, interested buyers will hopefully have the opportunity to go the conventional route. By far, the first level is the highlight of the team’s apartment – upstairs, room has been sacrificed to make for their light vault, although the feature is a success. And that said, the confinement will not be felt nearly so keenly when the apartment isn’t filled by dozens of spectators. 
The styling in the apartment is patchy – while there are some terrific pieces scattered throughout, it feels a little sterile. This is magnified in the master bedroom, the size of which is not helped by the depressing concrete wall. The room’s black wardrobe with timber inlays, design-wise, is great; unfortunately, such oppressive darkness in such a small room doesn’t help matters.
<img src="/images/2014/03/24/resizer%204.jpg" width="460" height="258">
I disagree with the judges who in last night’s episode said the team’s walk in robe felt “cheap and nasty”; while the steel edges did feel too tough, after all the concrete and harsh colours of the master bedroom, the timber work provided some relief. 
Shuffling downstairs, the mood of viewers changed considerably. The stairwell itself is lit with terrific pendant lights, while a wall recess housed a large art work to great effect – the absence of art in a corresponding bare space in Brad and Dale’s apartment was felt.
<img src="/images/2014/03/24/lah3r6living10.jpg" width="460" height="259">
And the downstairs area was, as expected, the centrepiece of the twins’ apartment. The kitchen was truly enormous, and the sense of luxury continued through the living and dining areas. While the apartment’s décor lacked the warmth of the other teams, the twins’ understanding of the modern buyer was on show; the little tucked away work nooks and the option of dining on the formal table or on the huge bench space will appeal to many contemporary workers, for whom flexibility is everything.
After spending more than an hour in tight quarters with my fellow spectators, stepping out of The Block and onto the street felt a little bewildering. Strolling past host Scott Cam, who was taking photos with children while a magician entertained line-weary fans, one is reminded that no matter how the auction goes on April 8, with another season already planned for this year, the show will go on. 
Photos courtesy of Channel 9 
</body></html>

jrichardson-uRX5hFdKfN

The Block on show at this weekend's open for inspection

<html><body>
With soft first home buyer numbers recorded, and Finder.com.au suggesting this will continue over the year, the comparison site is referring to the struggle between investors and first time buyers as a ‘property war’.
There was a slight increase in the proportion of first home buyers of all owner-occupied loans financed in January 2014, from December’s 12.7% to January’s 13.2%, as recorded by the Australian Bureau of Statistics however this is still five times less than investment loans financed.
With investment loan commitments in January among the highest levels recorded, over $8.4 billion, this was starkly in contrast to first home buyers’ $1.75 billion.
Michelle Hutchison, money expert at Finder.com.au, said that investors’ strength is likely to continue their hold over the first timers this year.
“Investors are holding some first home buyers hostage from the property market as they take advantage of low interest rates and high yields. If you’re a first home buyer and not prepared, you won’t get out alive – with a property to own,” said Hutchison.
“Investors are stronger in the property market than first home buyers because they can use equity from their existing home and take advantage of low rates to snap up properties faster. While first home buyers are slowed down by the cost of saving for a deposit and upfront fees with no existing equity,” she said.
“If this trend continues, we can expect to see property investors grow even stronger, and likely to hit almost $10 billion in home loans financed per month by December.”
Whether any of the investors were first time buyers, purchasing for an investment and not a home, has not been identified.
Despite the metaphor, Hutchison encouraged first home buyers not to be intimidated by the investor presence in the market, noting that a stable job, a saved deposit and an understanding of home loans should leave these buyers comfortable.
Similarly, she noted that a huge deposit isn’t hugely necessary, with many offering loans of up to 3% deposit, that setting a budget is crucial and that some government incentives are on offer.
</body></html>

Investor and first home buyer struggle dubbed a "property war"

<html><body>
Upon buying or selling a property there is what is called a ‘settlement period’. This is the length of time between which the buyer completes payment of the contract and then takes over ownership of the home.
Up until settlement, the property is the legal responsibility of the vendor. That is, they will be required to pay rates for up to, and including, the day of settlement. After this, the buyer takes over.
As the property is not transferred until settlement day, the buyer will not yet have a mortgage over the home.
Remember, the settlement period can be used as a negotiating tool to help get a deal over the line. It is not uncommon to see disagreements over the settlement period cause a sale not to occur.
Common settlement periods Common periods for settlement are usually 30, 60 or 90 days. In New South Wales, 42 days is fairly common, while in other states and territories it tends to be 60 days.
However, this isn’t set in stone and both parties can ask for longer or shorter settlement dates. Both the vendor and the buyer must agree on the settlement period, and this can cause some issues if different motivations come into play.
Delays can happen on the vendor and the buyers end, and they may wish to change the settlement. However, this will have been written into the Contract Of Sale and neither the vendor nor the buyer is under obligation to change to suit the other after the initial agreement.
The settlement period allows time for conveyancing, organising the move and lining settlements up with other property interests.
It is unlikely the buyer will be granted access ahead of the settlement’s completion and the keys are usually given after settlement takes place.
Why a longer settlement?
A longer settlement allows the buyer to save up some more money as a buffer – such as using six months to store away as much as possible. This is particularly the case for upgraders who are dealing with a smaller mortgage currently, first home buyers who are paying low levels of rent or living at home and investors who are adding to their portfolio.
The additional funds can be saved for renovations, furnishings or anything else as required.
The vendor may prefer a longer settlement if they are still looking for a property to purchase, are waiting to get past a significant event in their own lives (such as relocating overseas) or similar. There are many reasons for this option.
A longer settlement may also benefit the buyer in that any market upturns will become instant capital gains when settlement is finally processed as, by this point, the price offer will have already been accepted. However, this may mean that the market can also drop or the vacancies in the area increase, before you have even had the opportunity to bring a tenant in.
Why a shorter settlement?
Vendors who have already found another home, and buyers who have sold theirs, may be keen to move in to the home quickly. This often encourages a shorter settlement, particularly if the vendor faces having to pay for both.
Similarly, some buyers will want to move in ahead of Christmas or a holiday period, particularly if it is a family buying, and a shorter settlement near these periods may be requested.
Shorter settlements can also suit those wanting to undertake work to the property as soon as possible, or who are expecting a positive cash flow from owning the home.
Other considerations
Regardless of the length of the settlement, damage can be done to the property during this time and it is wise to have something written into the contract regarding assessing ahead of time to ensure that the vendor rectifies any later issues.
</body></html>

Latest Expert Insights

Buying off-the-plan in Melbourne? How independent iCIRT ratings are set to change Victorian property

Guides

Editor's Picks

Guides

Developments

New apartments

New townhouses

News

Latest Expert Insights

Buying off-the-plan in Melbourne? How independent iCIRT ratings are set to change Victorian property

Guides

Editor's Picks

Receive the latest news stories to your inbox

Guides

Developments

New apartments

New townhouses

News