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.

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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.

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<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.

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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.”

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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.

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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.

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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.

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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.

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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.

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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.

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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.

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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.

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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.

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<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.

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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.

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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

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As it turns out, the Australian economy wasn't the basket case Treasurer Joe Hockey, the rest of the government, business groups and their media mates have been claimed it to be after the gloomy mid year economic outlook was released last December. Economic growth picked up in the December quarter, <a href="https://www.propertyobserver.com.au/https://abs.gov.au/ausstats/abs@.nsf/mf/5206.0?OpenDocument" target="_blank">ABS national accounts</a> showed this morning, with growth of 0.8% seasonally adjusted, stronger than it was in the three months to September (0.6%).
In his first few months as treasurer, Hockey first warned us of the dire threat to growth from offshore -- back when he announced he was lavishing $9 billion on the Reserve Bank -- and then after he took the lowest possible forecasts from Treasury for the Mid Year Economic Forecast in order to portray himself as Hercules cleaning out the Augean stables left to him by Labor.
Today's numbers, though, suggest Hockey was more Chicken Little than Hercules. Growth through all of 2013 was a much stronger 2.8% compared to the annual rate of just 2.3% in the September quarter. The 2013 growth rate was much closer to the 3.1% growth seen in calendar 2012 and makes a mockery of the gloom and doom that emanated not just from Hockey but even from the unions and Labor, anxious to portray the government as killing the economy through being unwilling to keep handing out money.
But when Hockey held his MYEFO media conference in December 17 last year to detail to contents of what appeared to be a 'slit your wrists' assessment from the economy, the real thing was gathering pace - that's what successive figures for retail sales, exports, the National Australia Bank's business surveys and quite a few other measures show. Against that there was jobs data was negative and looking like it would worsen in line with forecasts, before it would improve. But the turmoil over the Holden announcement had little impact on consumers: they started using their savings (the household savings ratio fell below 10% for the first time since mid-2010), spent more in shops, on property and overseas travel.
The only gloomy spot, which we knew about from last week's capital expenditure data, was for private investment: gross capital formation - a measure of investment in the economy - which was a negative 0.5%. But thanks to the weakening dollar, the terms of trade rose 0.6% in the quarter as export volumes rose and import volumes fell -- net exports added 0.6%. But final consumption expenditure at 0.5%, much stronger than many business economists had forecast - that's down to the surge in retail spending in the closing months of 2013 and the real estate boom.
Industries contributing to growth were mining (1.2% because of the rising level of exports), while manufacturing (1.5%), rental, hiring and real estate added a combined 4.2% (not unexpected given the surge in property prices and activity).
GDP per hour worked also lifted yet again, providing yet more evidence of the sustained period of labour productivity growth delivered under the Fair Work Act -- up 0.6% in the quarter and 1.7% throughout the year, and slightly higher in the private sector. And unit labour costs fell 0.7% as well. More data that doesn't fit the narrative.
This article first appeared on <a target="_blank" href="https://www.crikey.com.au/">Crikey</a>.
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po-LsXgBTHBmX

The economy is not as bad as Joe Hockey claims: ABS national accounts

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Growing business confidence and easier access to capital could see Melbourne's strata office in for a big year in 2014.
Full-floor office sales in the last quarter of last year came in at more than 13 and that level of strong level of activity spilled into the start of this year.
DTZ manager of CBD Strata Sales, landlord and institutional investor services, Danny Clark said: “We are being inundated with strata office enquiries, and 2014 is set to be a strong year for sales in the sector with growing business confidence and easier access to capital.”
Such is the competition, DTZ CBD strata sales and leasing executive, Samuel Bell added that it recently concluded the sale of a vacant floor at level 1, 20 Queen Street (pictured below), which attracted fierce competition from both owner occupiers and investors.
{yoogallery src=[images/stories/2014/03/05/mel]}
The sale, he said, further highlighting the fact that investors were now prepared to carry the risk on vacant floors.
“We are starting to see increased competition from both local and offshore investors looking for quality investments; however, full floor investments are a rarity in the Melbourne market. This competition, coupled with a shortage of available stock, is leading to record sales per square metre," said Mr Bell.
The 20 Queen Street floor was 390 square metres and sold for $1.1 million.
Nearby, at 620 Bourke Street, a 567 square metre floor on level 4, fetched $2.075 million.
Levels 1 and 2, at 420 Collins Street - combines floor size of 780 square metres - sold for $2.9 million.
<a href="mailto:news@propertyobserver.com.au" target="_blank"></a><a href="mailto:news@propertyobserver.com.au">news@propertyobserver.com.au</a>
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kjiminez-eaYKfU7qd2

Melbourne strata office market tipped for a big year

<html><body>
The new credit reporting system may actually benefit a number of consumers, with those who lower their finance costs set to be rewarded, according to Smartline Personal Mortgage Advisers.
While the changes to credit reporting have received some criticism in recent days, <a href="https://www.propertyobserver.com.au/finance/a-new-credit-scoring-system-how-it-will-affect-you/2014022768077?utm_source=po&amp;utm_medium=aida&amp;utm_campaign=mostread" target="_blank">including from Property Observer readers</a>, Smartline’s Michael Daniels said that it’s increasing transparency and therefore more attractive terms for low risk customers.
With the changes to the Privacy Act coming into place as of March 12, the ‘negative’ credit reporting system will be no longer. More detailed information will be at the hands of credit providers. “This means they can make better informed decisions about an individual’s financial situation and the likelihood of them not meeting their obligations,” said Daniels.
“Those who are viewed as not being a strong manager of their money will most likely either find it harder to access funds and/or pay a premium in the form of higher rates.”
The main changes to be aware of:
<ul>
<li>Information about your monthly repayment conduct (i.e. whether or not you have paid on time) over the past two years can now be reported.</li>
<li>If you apply for credit, the decision (declined or approved) by the credit provider can now be reported.</li>
<li>The current limit on all of your credit cards (and other credit facilities) can now be reported. This also means that if you get a limit increase, this can now be reported on your credit record.</li>
<li>The repayment term and repayment type on all of your credit facilities can now be reported.</li>
<li>A credit provider can now also provide an opinion that you have fraudulently attempted to get credit or fraudulently evaded your obligations to repay credit, or that you do not intend to comply with your repayment obligations.</li>
<li>Credit defaults can be lodged on any outstanding amounts over $150 if you are more than 60 days behind on your repayments.</li>
</ul>
Source: Smartline 
The finance industry has been following the lead of the insurance industry when it comes to determining pricing based on risk, he said, with lower LVR borrowers able to secure better rates.
“The overall cost of credit fraud in Australia is quite high and this new system could go a long way toward reducing the cost of credit for the majority who do the right thing,” he said.
Historical information prior to March 12 will not be included.
<a href="mailto:jduke@propertyobserver.com.au" target="_blank">jduke@propertyobserver.com.au</a>
<address> </address>
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jduke-EHk3XBmHkn

Credit reporting changes will actually benefit consumers: Smartline

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The 2014 outlook for Australia's $1.3 trillion mortgage market is positive, according to the latest mortgage from Deloitte. The research firm, which surveyed a roundtable of residential lending industry leaders to consider the driving factors of change in the market, is predicting a "consumer-driven revolution" in mortgages.
Deloitte's report notes that at the end of 2013, a record number of housing commitment applications across the market was driven by annualised settlement growth of about 20%. Deloitte banking partner James Hickey was one of the report's primary authors. "Settlements across Australia on a monthly basis in 2013 reached more than $28 billion. That is the highest single monthly settlement rate on record, and a clear jump since the onset of the GFC, when they struggled to reach $20 billion," said Hickey.
<img src="/images/stories/2014/03/05/deloitte_march_5.png" alt="deloitte_march_5" width="470" height="302">
"Confidence among borrowers is high. Investors have made a comeback and funding pressures are easing, promising a vibrant and competitive mortgage market this year and through to 2017."
But Hickey also noted that the market's performance wasn't due to the new buyers.
"However, most of the growth in settlement volumes through 2013 was due to existing owner-occupiers upgrading and investors returning rather than first home buyers entering," Hickey said.
The report also pointed to changing technology as a key factor that will shape the mortgage market over the next three years.
"The consensus from the Deloitte Mortgage Report roundtable was that digital and data will be the main game for mortgages over the next three years. For consumers, lenders and brokers, the digital and data revolution is producing significant change in how they are accessing and delivering the mortgage of the future," said Hickey.
"Much of this change will be consumer-led and driven by the need for both simplicity and advice from customers as to how best to manage their finances.
"The organisational winners will be those that can make the best scientific interpretation of the masses of 'big data' that financial institutions and others continue to accumulate and use this to facilitate successful proactive and valuable interactions for the consumer. Digital will be a critical enabler of that," Hickey said.
According to Deloitte Digital partner Katherine Milesi, face the challenge of presenting a coherent brand and service to customers who use a variety of digital devices. 
"Customers want their banks to make life easier for them by using the unique data they have, to help them better manage their money. A simple example is being able to save an incomplete online application form and then call a sales assistant who can expedite completion. Being able to switch from one channel to another, without losing data or context, is exactly what omni-channel banking will deliver," Milesi explained.
Milesi also noted that the results of the government's upcoming Financial Systems Inquiry will influence activity in the mortgage market.
Of the inquiry, Deloitte Banking partner Graham Mott said, "The two largest engines in Australian financial services are mortgage lending ($1.3 trillion) and superannuation ($1.5 trillion). The inquiry needs to explore how these two significant systems can better interact at a macro (systems-wide) and a micro (household) level.
"There is a really exciting opportunity for the Inquiry to assist financial services be more integrated. To paraphrase Yellow Brick Road CEO Matt Lawler at the Deloitte roundtable: 'There is no longer one great Australian dream, there are two dreams running in parallel - to own your own home and to retire comfortably.'"
<a href="mailto:jrichardson@propertyobserver.com.au" target="_blank">jrichardson@propertyobserver.com.au</a>
                           
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jrichardson-uRX5hFdKfN

Competition to intensify as mortgage settlement growth returns: Deloitte

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It’s a common misconception amongst property investors: “never sell your property”. Although residential property investment requires a long-term outlook to ride out market fluctuations and maximise the effects of compound capital growth, even the best quality investment asset has a use-by date.  
The whole point of investing is to improve your quality of life. At some stage, you’re likely to reach the point where selling a property is the only way to help achieve further investment or lifestyle goals. Here, we look at four situations in which it may be appropriate to sell.  
1. Making room to move. If you have a growing family, you may need to renovate or extend the family home. If you take out a loan to meet these expenses, you’ll pay the full amount of interest, because expenses associated with the family home are not tax deductible. By contrast, if you sell your investment property, you can use the proceeds to pay for the home improvements outright.
When you’ve completed the renovations, focus on paying down the remaining debt on your home so that you’ll be well positioned to buy another investment property later down the track.
2. Hanging up your hat. If you’re nearing retirement and you have an investment property that you’ve held for many years, it may be worth selling it and transferring the equity into a more tax effective structure. When you’re working, your aim is to generate income through a wage or salary and purchase assets that will create capital growth.
Once you retire, however, it’s the job of your investment assets to generate the income for you. To maximise the available income, you need to minimise the tax payable. If you sell your investment property and put the proceeds into a superannuation account, the income generated will be tax-free when you draw on it in years to come.  
3. Ditching an underperforming asset. Regardless of your stage of life, there’s little point in holding on to an investment property if it’s not performing to an acceptable standard. It’s important to review your property’s capital growth performance each year, relative to the wider market. If it fails to outstrip the median increase for a couple of years running, chances are this situation won’t change anytime soon. It may be better to sell the asset and move on to something more productive.
 4. Getting away from it all. Many people who are reaching the peak of their careers like to escape to the coast or country on weekends and recharge the batteries. If you’ve held an investment property for 10 years or more and it has achieved significant capital growth, it may be appropriate to sell the property and use the proceeds to buy a holiday home outright. Generally speaking, properties in holiday areas have a more volatile capital growth pattern, and should not be regarded as prime financial investment prospects. They’re really an investment in lifestyle.
Remember the decision to sell an investment property should never be undertaken lightly. Regardless of your personal and financial situation, seek independent personalised advice before you make a decision.  
Mark Armstrong is a director of <a href="https://www.ipropertyplan.com.au/">iProperty Plan</a>, which provides independent analysis and tailored advice to investors and home buyers.
Note: This article was originally published on Property Observer in November 2013.
                                                    
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Four signs that it's time to sell up

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In November 2012, the Australian government introduced a Significant Investor Visa (“SIV”) for migrants as prospective permanent residents who invest $5 million into complying investments in Australia for a minimum period of four years. Complying investments include Australian government bonds, ASIC regulated managed funds and direct investment into Australian proprietary companies. This initiative has brought opportunities and challenges in Australian property.
Opportunity
SIV will draw capital flows into Australia. Under the new visa scheme, the Australian government expects to attract 700 new residents annually and $3.5 billion in complying investments. As the majority of SIV applicants to date are Chinese, known for their keen interest in Australian property investments, it is reasonable to expect that a sizable portion of SIV funds will flow into the property market, with estimates of $2 billion per annum of new capital.  On a cumulative basis this is material for a total commercial property market valued at $700 billion. Investors may participate in property investment syndicates, which purchase existing properties or participate in property development projects.
With the aid of advisors and Australian fund managers arranging financial affairs for migration purposes, SIV applicants will gain an initial exposure in Australian investments. As familiarity and trust between SIV applicants and Australian fund managers grow, participation in wider investment products is possible with additional savings from SIV applicants. Although the initial $5 million from successful SIV applicants is committed to complying investments, excess funds are not restricted. Australian fund managers will be in a strategic position to build long term relationships with SIV clients, providing holistic solutions for their financial needs.
Table 1 shows current SIV statistics from the creation of this visa on 24 November 2012 to 31 October 2013 which provides support for the target of 700 new residents annually.
Table 1: Significant Investor Visa key indicators - November 24, 2012 - October  31, 2013
<table style="width: 470px;" border="0" cellspacing="0" cellpadding="0"><tbody>
<tr>
<td valign="bottom" nowrap width="293">
Indicators
</td>
<td valign="bottom" nowrap width="64"> </td>
</tr>
<tr>
<td valign="bottom" nowrap width="293">
Expression of Interests (EOIs) submitted:
</td>
<td valign="bottom" nowrap width="64">
825
</td>
</tr>
<tr>
<td valign="bottom" nowrap width="293">
Invitations issued:
</td>
<td valign="bottom" nowrap width="64">
631
</td>
</tr>
<tr>
<td valign="bottom" nowrap width="293">
Applications lodged:
</td>
<td valign="bottom" nowrap width="64">
498
</td>
</tr>
<tr>
<td valign="bottom" nowrap width="293">
Primary visas granted:
</td>
<td valign="bottom" nowrap width="64">
65
</td>
</tr>
<tr>
<td valign="bottom" nowrap width="293">
Applicants from China:
</td>
<td valign="bottom" nowrap width="64">
91%
</td>
</tr>
<tr>
<td valign="bottom" nowrap width="293">
 
</td>
<td valign="bottom" nowrap width="64"> </td>
</tr>
<tr>
<td valign="bottom" nowrap width="293">
Applications on hand (31 Oct 2013)
</td>
<td valign="bottom" nowrap width="64">
422
</td>
</tr>
<tr>
<td valign="bottom" nowrap width="293">
- Less than 3 months:
</td>
<td valign="bottom" nowrap width="64">
41.2%
</td>
</tr>
<tr>
<td valign="bottom" nowrap width="293">
- 3-6 months:
</td>
<td valign="bottom" nowrap width="64">
38.6%
</td>
</tr>
</tbody></table>
Source: Department of Immigration and Border Protection
Challenges
Converting SIV investors into a viable funding source for property investment or development lies with the development of syndicates which will include a number of SIV investors. Property syndicate managers will need to accommodate a number of investors from different cultural ethnicity and business practices.
Another challenge of SIV funding lies with the liquidity of funding. The SIV legislation requires the applicant to have $5 million invested into complying funds for four years. This exceeds most development project lifespans. SIV Investors may switch within four years, as long as the switch is done within 30 days into another complying fund.
SIV poses as an opportunity for raising capital into property syndicates. Property syndicate managers will need to acknowledge and manage the unique nature of SIV investors in order to tailor solutions around this initiative.
 
Ming Niu is an analyst at <a href="https://atchison.com.au/" target="_blank">Atchison Consultants</a>.
 
                      
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Significant Investor Visa – a new source of capital for property investment syndicates? 

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After a year in which the number of empty floors in Australia’s office buildings increased to around one in 10, there is an intense debate about where office demand will come from. In the context of a generally subdued economic outlook, there are at least six reasons why office demand should improve over the next year or two:
1. Business confidence is improving
Business confidence has trended up over the past six months in all states and across most industries and is now close to a three year high.Confidence is a key component of the DEXUS office barometer which predicts improvingconditions for office demand in the Sydney CBD.
2. Improving corporate earnings outlook
The share market has strengthened considerably over the past year. A stronger share market is expected to lift confidence further and lead to more corporate transaction activity, supporting demand for space in the investment banking, legal and accounting sectors.
3. The Australian economy is responding to low interest rates
While declining resource investment will be a drag on economic growth, other factors will partially offset it. Improving retail sales, tourism numbers and housing construction will all contribute to growth. Meanwhile the trading bank sector is benefiting from improving credit growth, and the health and education sectors are also on a growth path.
4. The business service sector will benefit from outsourcing 
The business services sector in Australia has added more jobs to the economy in the past decade than the government and mining sectors combined. While state and federal governments are intent on consolidating to the detriment of demand for office space, such consolidation usually leads to outsourcing,supporting growth in the business services and technology sectors.
5. Most firms will grow, despite productivity gains 
Over the past decade the number of firms expanding at the end of their office lease has outstripped the number of those contracting, by a factor of three to one. While the corporate sector in Australia remains focused on productivity improvement, this focus should slowly shift towards expansion as corporate earnings benefit from productivity improvements and low financing costs.
6. Tenants will migrate to quality buildings
Competitive rents in the major CBDs areencouraging the inward migration of tenants from fringe and suburban locations - estimated at more than 20% of recent CBD leasing. In addition, tenants are actively migrating from poorquality buildings to better quality stock, leading to withdrawals of older stock.
Peter Studley is general manager, research, at <a href="https://www.dexus.com/" target="_blank">DEXUS Property Group</a>. 
                            
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Six reasons why demand for office space will improve

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I caught up with a friend last night after she returned from a great holiday. As the conversation steered from cruise ships to saving money, she voiced her aspiration to purchase an investment property.
At 32 years old, I was thrilled to hear from someone so young – just shy of her 21st birthday in fact – who is already contemplating her financial security for later in life. I believe that the best executed plans in life are always those that are planned as early as possible. The thing about starting in property investing at a very young age is this: at just 20 years young, my friend will face a slew of challenges.
However, these challenges should not deter her. In fact, well-planned property buys at a young age can really expedite growth and gain for later in life. You just need to find work-arounds for the (many) challenges you will face.
Here’s a list of considerations for very young (under-25) aspiring investors.  
Identify whether property is the right investment class for you  
A property is a big commitment for anyone, but especially for a young person. I say this because between the ages of 18-25, young people are likely to have many lifestyle changes, and most of these will be unexpected. First are the financial ones: moving out of home, working part time if a student and earning a modest – and sometimes inconsistent – salary. Then there are the lifestyle ones: deciding to go backpacking for a year randomly, changing study courses or stopping/starting full time work for study reasons. Plus, as the busiest social years of your life there’s partners, friends and parties/adventures away.
What I’m getting at is this, it can be an unpredictable and inconsistent time in your life. Property investing best suits people who are disciplined and understand it is an ongoing commitment that requires focus. For this reason, investment classes that are less admin-heavy – such as shares, term deposits and managed funds – can be more attractive and a safer investment for first time younger investors.  
Managing your own expectations  
It’s smarter to do this yourself, because there will be many other parties (parents, lenders, solicitors, and so on) who will be the quick to serve you reality checks at every stage. This won’t happen as often and won’t disappoint or deter you, if your expectations out of an investment property exercise are more realistic.
At a young age it can be hard to distinguish between, say a pretty property that you ‘like’ because you think it’s a nice place to live yourself, with a property that stacks up well as an investment. Investing is not about that experience – that’s what home buying is for. No, investing is about numbers. Managing your own expectations on how you expect an investment property to look and feel, versus the reality of a property, is one of the first things you need to do.  
Savings, savings, savings  
Before you even consider budget and spend range; know this. For under-25’s and especially for under-21’s, a lender will want to see at least 12 months of consistent savings before giving loan approvals. Racking up credit card debts won’t look good either (though if you have one and are paying it off diligently, this might serve you well). Lenders want to see evidence of consistent savings efforts.
On this, it is worth considering some government savings incentives currently on offer for first home saver accounts. With these kinds of accounts you are rewarded with government contributions in proportion to the amount you contribute. Do be weary of the terms and conditions with these accounts, however, as some accounts have penalties or restrictions on pulling your savings out earlier than the term date for the accounts. Many lenders offer these kinds of saver accounts in collaboration with the Australian government. Here is <a href="https://www.infochoice.com.au/banking/savings-account/first-home-saver-accounts/" target="_blank">a great comparison site</a> for several of these saver accounts.
Be realistic about your budget
As an extension of the above point; it is unrealistic for an under 25 year old (unless they have managed to secure a very above-average wage for their age) to spend say $500,000 or $600,000 on their first property – home or investment. In fact; odds are most lenders will turn you down. Even if they didn’t, I would not personally spend that much money on a property at such a young age. It is too much of a commitment. If you are a teenager or in your early 20s I’d look at a maximum spend of $200,000 to $250,000 on your first investment property. Securing finance will be easier; and managing the property will be more realistic.  
This may mean you can’t afford your own backyard 
Based on a $250,000 maximum spend rate, you will need to assess where you can afford to invest. Odds are, if you currently live within a 20 kilometre radius of Sydney, Melbourne, or Perth, it’s highly unlikely you will be investing near where you live. Challenge yourself to consider towns and cities that aren’t your own, or even within your home state. The key to successful location-sourcing for investment properties is not simply in following trends of ‘hot suburbs’ reported in the media, but on suburbs where the sums add up to produce a viable investment prospect.
Cameron McEvoy is a NSW-based property investor and maintains a blog, <a href="https://www.propertycorrespondent.com.au/" rel="nofollow" target="_blank">Property Correspondent.</a>
                        
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Five tips for young aspiring property investors

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Predicting the future or markets is not a science and since some people make bad financial decisions based on spurious predictions, the predictors absolutely deserve to be pulled up for their errors. The world is not linear, and while pulling charts from thin air may look impressive, there is no way to predict markets with such certainty. In any case, you can invent a chart to 'prove' anything. Take our old friend, the good old S-curve. The x axis represents time passing (x to left, y to the sky, remember?), and the y axis cumulative data.
<div style="text-align: center;"><img src="https://www.forecastingnet.com/S-curve.png" style="padding: 5px; border: 1px solid #ebebeb; box-shadow: rgba(0, 0, 0, 0.0980392) 1px 1px 5px;"></div>
S-curves can be used for a number of different functions, such as to explain the technology life cycle, or the lifespan of a product. An example? Say, the new users of a website such as MySpace. The number of new users started out slowly (early adopters), then the site became increasingly popular (early majority), then popularity exploded after Lily Allen started posting her recordings publicly on the site (late majority), and then the number of new users slowly flattened (laggards), eventually to close to nil. The MySpace cumulative number of users chart, if anyone has bothered to chart it (which I assume they have somewhere) probably looks something like my S-curve above.
The problem with these books which try to predict the future scientifically is that the world is not black and white, and the number of variables involved is huge. In any case, you can use an S-curve to 'prove' just about anything you want. Let's say, the property crash predictions over the last seven years. Simply add some silly narrative to prove the chart.
<a href="https://4.bp.blogspot.com/-Oba3tBnlDo4/Uw0j2-NEo7I/AAAAAAAALow/G8lYbv_GWcM/s1600/S+curve.jpg" imageanchor="1" style="text-decoration: none; color: #7f7f7f; margin-left: 1em; margin-right: 1em;"><img border="0" src="https://4.bp.blogspot.com/-Oba3tBnlDo4/Uw0j2-NEo7I/AAAAAAAALow/G8lYbv_GWcM/s1600/S+curve.jpg" height="244" width="320" style="border: 1px solid #ebebeb; position: relative; padding: 5px; box-shadow: rgba(0, 0, 0, 0.0980392) 1px 1px 5px; display: block; margin-left: auto; margin-right: auto;"></a>
Point A (2007) - property prices in Australia's main cities have been flat after a boom through to 2004. All is quiet on the crash prediction curve.
Point B (2008) - "40% crash" predictions appear in the press. Bearish sentiment and crash predictions slowly begins to ramp up.
Point C (2009-10) - prices increase sharply in response to low interest rates. Property investors are variously termed as unethical, greedy and evil. The crashniks gain momentum. A price crash is described as inevitable.
Point D (2011-12) - the crash crescendo reaches fever pitch as property prices fall moderately. Anyone who owns a house is an idiot. American commentators say prices will crash by 60%...maybe up to 85% in certain areas. People will be wiped out. There is to be no escape from the unavoidable crash.
Point E (2012-14) - prices start rising again. ANZ Bank forecasts prices will rise by 15-20% by the end of 2015. In early 2014, bears begin to lose interest in the crash, capitulate and buy houses. Some join in and buy investment properties.
Point F (2016) - prices flatten off. We return to Point A on the chart.
Is there such a curve? No, of course not. It's absolutely ridiculous and I just made it up on the spot. But this is exactly the sort of thing that is used to sell books. All I need to do now is trademark it - "The Property Crash Prediction Curve" - and get it out to market.
Trends
In saying all of this, I have witnessed something akin to this more than once in London, and first time buyers are often said to wait until markets are rising before committing to buying.
In the modern era, first time buyers in large, mature capital city markets are likely to be in their 30s. There was a lot of talk about property prices crashing when the technology stock bubble burst around the turn of the century, and while sentiment did soften in some areas, there is only so long that people are prepared to wait for a crash.
It's happening in London again now, with Savills out forecasting <a href="https://www.savills.co.uk/resources/5-year-forecast/" target="_blank">five more years of price gains</a> of around 25% from 2014 to 2019. Plenty of buyers took a step back from 2009, during and after the financial crisis, but since a man's working life is only so long there is a limit to how long people will wait before simply deciding to get on with it and buy a home.
Next page: What S-curves are really used for in property. Please click below.
                    
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What S-curves are really used for in property
Meanwhile back in the real world, and with my bean-counter head on, S-curves do actually have an important role to play in the property world.
When major developers undertake new projects, they are costed using an S-curve model or function, with cumulative labour and construction costs budgeted out through the life of the project. Deviations from the curve are then continuously monitored on an ongoing basis through variance analysis and through using project reporting accounting software packages.
Typically, a major development or construction project has relatively low planning, legal and application costs in its early days, before construction and labour costs ramp up sharply. Then, at the end of the project there will always be a few lagging costs, such as remedial work or disputed contracts, and the project reporting codes are then closed.
Development of new stock
You'd be forgiven for thinking from looking at the price of new apartments that developing companies are making obscene profit margins, but you'd be wrong. Once land, financing, government taxes and charges, labour and construction costs are booked and corporate overheads allocated to a project, developer margins are far from exceptional.
LendLease (ASX: LLC) released its Group Consolidated Results for the half year yesterday, showing a net profit of only $250m, from a colossal revenue of more than $6.5 billion for the half year. The Mirvac (MGR) results present a similar story. Stockland Group (SGP) is generating a Return on Equity (ROE) of well under 6%. Solid enough results, but hardly exceptional margins.
Construction costs
I spent a fair chunk of my career costing out (mining) construction projects and have been responsible for managing budgets that have suffered nasty adverse deviations from the S-curve and painful overruns. It's unpleasant. And if you have to go back to the equity markets for further capital raisings, it's more unpleasant still. For everybody concerned.
The capital expenditure report from the ABS shows that, for all the talk of mining construction having peaked 18 months ago, it is only now beginning to drop. The reason? Overruns, caused by the sharply increasing cost of doing business, variously including labour costs, construction costs and compliance.
The <a href="https://www.propertyobserver.com.au/https://www.abc.net.au/news/2013-12-12/gorgon-gas-project-cost-blowout/5151982" target="_blank">Gorgon gas project in north-west WA will cost $54 billion</a>, possibly even more. The original budget was $37 billion (thankfully, I've never been responsible for an overrun like that monster!). The cause of that? Red tape and compliance. And as our society becomes more litigious, this is only going to get worse not better. You seemingly can't fire anyone these without a dozen written warnings or a large lump sum payout.
Ask anyone who has managed or overseen a construction project in the last decade and they'll tell you the same thing: labour and construction costs in Australia are very painful. It's partly been driven by a surge in wages. We may have an implied inflation target of Australia of 2.5%, but wages growth has outstripped this figure every year since the inception of the Wage Price Index.
But that's only half of the story. Employing people in Australia today is not only a consideration of basic salary. When budgeting for project labour costs, additional provisions of up to 40% are sometimes needed for on-costs such as productivity, the superannuation contribution, Workers Comp insurance, payroll tax, annual leaving loading, long service leave provisions, and so on.
And even this is only part of the story. As my mining engineer friends in the field never tire of telling me: "You can't even take a leak without filling out a form these days". Coarse. But also true.
Article continues on next page. Please click below.
                             
<hr class="system-pagebreak">
Focus on safety
Safety on construction sites is now rightly seen to be of paramount importance - people are more important than profits - and this is coming with a dollar cost attached.
In Sydney recently, we have seen the death of a construction worker in the field at Barangaroo, a horrific scaffolding collapse on Mascot's O'Riordan Street and a crane upended in Chatswood, all of which hit the newspaper headlines.
Rightly or otherwise, the press now sees construction accidents as fair game for news reporting and this brings with it an elevated reputation risk to companies.
Go to the ASX and take a read of any property development company or mining company results presentation - such as that of <a href="https://www.asx.com.au/asxpdf/20140226/pdf/42mzs2x5klxngs.pdf" target="_blank">LendLease</a> - and you will see that after a pretty picture on the front cover and a lengthy disclaimer, the slide we always put as number 1 is: "Safety". It was not always so, but this is now convention is mining and construction circles.
Reserve Bank highlights construction costs issue
One of the benefits of having and independent Central Bank is the independent analysis it brings, and the Reserve Bank in Australia has itself highlighted more than once the impact of higher construction costs on new residential housing stock.
<img alt="Graph 8: Construction Costs" src="https://www.rba.gov.au/speeches/2013/images/sp-so-230413-graph8-small.gif" height="387" width="400" style="padding: 5px; border: 1px solid #ebebeb; box-shadow: rgba(0, 0, 0, 0.0980392) 1px 1px 5px; display: block; margin-left: auto; margin-right: auto;">
This might be surprising when you consider how cheap <a href="https://www.clarendon.com.au/" target="_blank">display homes</a> can seem in the glossy magazines. However, operating a construction site is a different matter entirely, and the costs of a major construction project - particularly for multi-storey infill sites of more than 50 apartments, as the RBA clearly shows above - bear no resemblance to those of mass-produced project homes.
The land price for infill sites, even in Sydney is below $100,000 per dwelling. Of course, the land content appears low in the RBA's charts when compared to the median value of lots in the city. And indeed it is, for a couple of reasons.
Firstly, because the RBA has used outdated 2011 figures from <a href="https://www.urbis.com.au/" target="_blank">Urbis</a> as its source. And secondly because the RBA is looking at the lot value of land released for new dwellings as opposed to the median value of all lots, which is clearly going to be materially different, given the likely locations.
Summary
In summary, we are not going to see materially cheaper land or property prices in Sydney because (a) the land for release is frequently on the outer fringe where few people want to live, and (b) as <a href="https://www.urbis.com.au/think-tank/general/sydney-land-releases-fail-to-meet-demand" target="_blank">Urbis itself confirmed</a>, not enough of new land gets released to meet demand anyway, which keeps prices pumped even further.
Rest assured that, expensive as today's new residential projects may seem to off plan buyers, significantly cheaper new stock will not hit the market. Developers will not accept lower margins than they presently are, and since labour and construction costs remain elevated, so too will the price of new housing stock.
In any case, planners are fighting a losing battle against the manic population growth in the capital cities, which is another reason why for all these years I've argued against a price crash. The Sydney population over the last decade increased by around half a million persons - enough people to fill the main <a href="https://d16outft0soac8.cloudfront.net/uploadedFiles/CONCERT%20HALL%20Tech%20Specs_Feb%202011.pdf" target="_blank">Opera House concert hall</a> to its full capacity 187 times over. That's a lot of people.
Population growth at that pace (and <a href="https://petewargent.blogspot.com.au/2014/01/read-matusik-on-population-growth" target="_blank">faster still in 2013</a>) doesn't necessarily equate to higher house prices, but it's hardly the recipe for a crash either.
OK, enough blurb from me. I'm off to trademark my new S-curve model.
Pete Wargent is the co-founder of <a href="https://allenwargent.com/" target="_blank" rel="nofollow">AllenWargent</a> property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank" rel="nofollow">blogger</a>.
His new book '<a href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx" target="_blank" rel="nofollow">Four Green Houses and a Red Hotel</a>' was released on 1 September 2013.
                     
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The property crash prediction S-curve (TM): What it can really tell us

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The light at the end of the tunnel has arrived for Australia's accommodation market, with supply levels hitting a record high last year.
Research from JLL's latest Top Hotel Owners and Operators Survey showed that accommodation supply rose 1.3% to 230,064 rooms at the end of June 2013, which it described as a "positive sign" that the market is "once again poised for growth after the uncertainty of the past few years".
After declining in 2012, it said, serviced apartments emerged as the growth sector in 2013 with room supply increasing 2.6% year-on-year with the addition of 1,442 keys. That compared to growth of 1.9% (1,683 rooms) in the hotel sector and a 0.3% decline in motel rooms (-229 rooms), revealed the report, which is based on supply levels across the hotel, motel and services apartment sectors.
Of the 230,064 accommodation rooms in Australia, the top 10 owners accounted for 11.3% (26,085 rooms) of total room supply at the end of 2013 and the top ten operators 40.7% (93,691 rooms).
The survey noted that the top 10 owners recorded a 1% lift in rooms in 2013 with the addition of 267 rooms.
<img alt="JLL_Australia_top_ten_owners_-_chart-march-5" height="375" width="470" src="/images/stories/2014/03/05/JLL_Australia_top_ten_owners_-_chart-march-5.gif">
Source: JLL. Note: * Includes joint venture properties with Far East
Last year also brought one new entrant into the top ten - the Abu Dhabi Investment Authority (ADIA) - following its acquisition of the Tourism Asset Holdings (TAHL) portfolio. The sale saw TAHL exit the sector after more than a decade in the top spot, it said.
"The transaction represented the first major direct hotel acquisition by a Middle East group in Australia...," said JLL's Hotel &amp; Hospitality Group chief executive for Australasia, Craig Collins.
"Offshore groups now account for 53% of rooms owned by the 30 largest accommodation owners in Australia".
Offshore investors, the survey showed, were predominantly from Asia, albeit with an increasing proportion of rooms held by Middle Eastern and global groups.
"This indicates how globalisation trends are gaining pace once again in the new era of hotel investment", JLL said.
The survey highlighted that operating groups have been very active over the past year, resulting in some significant changes to the top order.
<img alt="JLL_Australia_top_ten_operators_-_chart-march-5" height="350" width="470" src="/images/stories/2014/03/05/JLL_Australia_top_ten_operators_-_chart-march-5.gif">
Soure: JLL. *Note: Not provided, sourced from website
Collectively, the top ten increased their portfolio holdings 2.5%, bringing the total rooms under management to 93,961 across 963 properties.
However, JLL also said that four companies achieved double-digit growth, with the biggest gains recorded by Toga Hospitality - up 30.4%; Hilton 27.9%; Best Western 12.1 % and Oak Hotels &amp; Resorts 10.7%.
<a target="_blank" href="mailto:news@propertyobserver.com.au">news@propertyobserver.com.au</a> 
                      
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