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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Westpac has announced that it will cut rates on its two and three year fixed rate mortgages.
Interest rates on two year fixed rate mortgages will be lowered by 0.05 of a percentage point to 4.84% per annum, while rates for three year fixed rate mortgages will now be offered at 5.09%, a drop of 0.04 of a percentage point.
With the Reserve Bank of Australia (RBA) choosing to keep the overnight cash rate on hold for February, Westpac has been the only of the four major Australian banks – Commonwealth Bank, ANZ, NAB and Westpac – to cut its rates this month.
In January, NAB lowered interest rates on its four year fixed term home loans to 5.44% per annum, a 20 year low for the bank. Rates for its three year fixed term loan were also cut, dropping 0.05% to 5.14%.
Commonwealth Bank is currently offering two year fixed rate loans at 4.99% interest per annum, with rates for a three year fixed rate loan at 5.24% per annum. Earlier this month, Commonwealth Bank chief executive Ian Narev commented that a rate cut “independent of any move by the Reserve bank” was “plausible over time.”
The interest rate on ANZ’s two year fixed rate loan is at 5.04% per annum, and the interest rate on its three year fixed rate loan is at 5.28%.
Westpac's rate changes come into effect on February 25.
<a target="_blank" href="mailto:jrichardson@propertyobserver.com.au">jrichardson@propertyobserver.com.au</a>
           
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jrichardson-uRX5hFdKfN

Westpac cuts fixed rates for two and three year loans

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The reasons being offered at present as to why consumption and confidence are down make for compelling reading, given there are so many theories being offered. I don’t believe blame should be cast at the Reserve Bank of Australia (RBA) for holding the official cash rate too high for too long. Rather I believe the main reason why so many businesses are not doing well lies with their very own business strategies that thus far have failed and will continue to do so.
Over the last decade I have watched aghast at how so many businesses have continued to ignore the all-powerful online cataclysm, which explains why business confidence is down. Transitioning your business online is just the beginning, the most important move is aligning the business with consumer sentiment.
The Australian Bureau of Statistics (ABS) has recently released its first estimate of the amount Australian shoppers spend on overseas based retail websites. The ABS believes about $6.23 billion of goods worth less than the government’s low value threshold were imported in the 2011/12 financial year. I suspect the amount would have increased a further fifty per cent in the 2012/13 financial year. One would have to think with the upcoming federal budget that the Treasurer will be closely looking at grabbing this revenue.
Heeee’s back! <a href="https://www.propertyobserver.com.au/news/bursting-harry-dents-own-bubble/2014021467757?utm_source=po&amp;utm_medium=aida&amp;utm_campaign=latestnews" target="_blank">Harry Dent keeps predicting</a> that Australia’s property prices will be slashed by half – and by the way he has a book you might want to buy. I’ve lost count how many times he has predicted this and to a certain degree he is probably a little bit right as some of the overheated areas will face value calibrations.
I am of the belief that the only logical and feasible way you can predict a value correction is when supply exceeds demand. We are not seeing that anywhere (that I can see) given the market roar is that there is not enough properties on the market.
<a href="https://www.rwm.com.au/files/2014/02/18-02-2014-2-56-49-PM.jpg"><img alt="18-02-2014 2-56-49 PM" src="https://www.rwm.com.au/files/2014/02/18-02-2014-2-56-49-PM.jpg" width="470" height="258"></a>
Source: Digital Finance Analytics Blog
An interesting point I noted from <a href="https://www.digitalfinanceanalytics.com/blog/household-housing-finance-ratios/" target="_blank">the author of this graph</a> was “Some have argued recently that house prices have not really grown that much, if you take inflation into account: The important thing to keep in mind however is that when you consider inflation, dwelling values remain lower than their previous peaks in every city.”
<a href="https://www.rwm.com.au/files/2014/02/11-02-2014-11-15-30-AM1.jpg"><img alt="11-02-2014 11-15-30 AM" src="https://www.rwm.com.au/files/2014/02/11-02-2014-11-15-30-AM1.jpg" width="470" height="279"></a>
Source: Digital Finance Analytics Blog
Another contributing factor is that state and federal governments are behind approximately 300,000 houses in their new housing construction quota which again puts pressures on the housing markets. The simple fact that investors are hording real estate in their self-managed superannuation funds (SMSF) adds another dimension to the supply v demand debate.
Again as the federal budget gets closer we will see strong <a href="https://theconversation.com/explainer-why-negative-gearing-is-bad-policy-21882" target="_blank">arguments presented for the abolition of negative gearing</a>: “In Australia owner occupiers compete with investors for housing property; and there is also competition within these groups. A small increase in the number of superannuation funds and foreign investors purchasing property can have a significant impact on demand; while first home buyers are finding it increasingly difficult to enter the market. Each of these groups is impacted differently by the tax system.”
In 2010/11 the tax statistics revealed that 2.5 million property schedules were lodged by individuals, identifying nearly A$30 billion of rental income received during that year. The deductions claimed against this income amounted to A$37.8 billion, of which A$22 billion was interest on loans.
On that basis if the federal government were to look at abolishing negative gearing (and I don’t believe they will simply because of the gearing) property prices would crash and in turn the banks would too.
Again, Mosman houses are a long way off hitting triple figures given in 2013 it hit and bettered that number on 33 occasions. In 2012, it managed triple figures on just four occasions which were February 21 and 28, and March 7 and 13. So based on that data there is a very strong possibility that in 2014 we won’t see Mosman houses breaking the 100 mark.
It really is not that hard to analyse property trends when you break it down suburb by suburb. The only problem for so many real estate commentators is that such an exercise is all too time consuming.
Robert Simeon is a director of <a rel="nofollow" target="_blank" href="https://www.rwm.com.au/" title="RWM" style="font-size: 14px;">Richardson  Wrench Mosman and Neutral Bay </a>and has been selling residential real estate in Sydney since 1985. 
He has also been writing real estate blog <a rel="nofollow" target="_blank" href="https://www.rwm.com.au/news/" title="Virtual Realty News">Virtual Realty News</a> since 2000. 
The RWM real estate model has sold in excess of $1 billion in database sales globally.
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robertsimeon-hRNTwJyXkQ

Let's keep it simple - it’s supply v demand

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It’s impossible to escape the reality that our employment market is in a flux. Big name employers like GMH, Toyota, Ford, Alcoa and Qantas are in the spotlight and there have been others over the last six months. Now we have a headline unemployment rate of 6%.
However we are also being told not to worry, in particular by the federal government, more rewarding jobs will be found, or in fact have to be found. We have also seen the participation rate fall as Baby Boomers in particular start to leave the workforce and it appears some may be doing so earlier than expected, with the irony that the current boom in real estate prices might be making it more appealing to ‘cash-out’ and retire early.
But despite what would usually be seen as negative news, many capital city real estate markets remain buoyant. This brings to mind a question – has the market become disengaged from employment data (at least in key markets) on the foundation of low interest rates?
Let’s consider some history
We all appreciate that the unemployment rate is influenced by a range of factors in particular the government’s policy framework for the labour market. Of possibly greater importance currently is the impact of a range of social factors like; working hours, a willingness to move locations, undertake further training or remaining in work at all.
If we look back over history we see that there was a substantial increase in the average unemployment rate from the mid to late 1970s, compared with earlier decades, between the Second World War to the mid-1970s, the unemployment rate fluctuated around a longer-term average of just 2%. This looks a remarkably low figure by comparison to now being at 6%. But there was in fact an even lower point at just 1%. Then in the period from the mid-1970s to the early 2000s, the unemployment rate fluctuated around a longer-term average of 7.5%. There was a high of 10.9% in 1992 – which makes 6% look pretty good!
While unemployment will always move around because of economic, institutional and social factors, these factors can change over time, and they change the structural rate of unemployment.  In 2014, we appear to be more accepting of a 6% rate as more ‘normal’ and not a reflection of short run or cyclical swings in economic activity. If this is the ‘normal’ then we may in reality see real estate markets less influenced by unemployment and more so by interest rates.
History also appears to repeat itself and in the mid-1970s we saw poor macroeconomic policy management, especially in the face of the first oil price shock, a much more rigid labour market and strong union influence, much higher inflation and a sharp increase in real wages relative to productivity. A lot of this sounds familiar as we move from the mineral infrastructure boom and massive period of change for manufacturing, although it is apparent that wage growth is running at less than snails pace.
Today we are looking at a reduction in employment opportunities and rising unemployment as businesses are reacting to the increased cost of labour, and a strong dollar. However, for the big picture impact on real estate markets we also need to take a closer look at interest rates, inflation and the unemployment level.  
Peter Chittenden is managing director for residential of <a href="https://www.colliers.com.au/Colliers%20Corporate/Residential.aspx" rel="nofollow" target="_blank">Colliers International</a>.
           
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pchittenden-eLqUUC8TWW

How important is unemployment in today’s residential market?

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A few weeks ago, I attended an auction in a popular suburb of Melbourne’s inner east.  
The home was an attractive four-bedroom townhouse on roughly 260 square metres of land, and initially quoted at $700,000 ‘plus’ - very typical of the type of accommodation featured in the area.  
As is commonly the case in Melbourne, the quote was ‘stepped up’ in the final week of the campaign to ‘$750,000 ‘plus’ – albeit, the listing agent informed me more than once he had $800,000 “covered”.  A mere blink at recent comparable sales indicated a price well in excess of $850,000, or even $900,000, considering the level of demand and lack of comparable listings being marketed.  
This was confirmed during the auction, when a neighbour I’d casually interacted with leaned over and in little more than a whisper told me: “I know the vendor – she wants $1 million”. Considering the property didn’t reach its reserve until $900,000, I suspect she was correct.  
With competition from nine bidders, the property sold in front of a crowd of 100 or so for $1,011,000, and the agent, delighted with the result, wasted no time swooping in on the ones who missed out, to share information of ‘similar’ listings currently for sale.  
Needless to say, it’s a story that drives many Australians irate, with the focus inevitably aimed at the misleading way in which it was quoted. However, this isn’t what should drive our sense of injustice to kick into gear.  
The undeserving poor  
Debate is currently rife in Australia surrounding the relentless costs of our welfare system, with Social Services Minister <a target="_blank" href="https://www.crikey.com.au/2014/01/24/kevin-andrews-dont-pick-on-the-disabled-and-those-on-the-dole/">Kevin Andrews heralding it ‘unsustainable’</a>, whilst looking for ways the government can cut entitlements to the undeserving poor.  
The review has concentrated primarily on disability payments, and Newstart job seekers allowance, which keeps the ‘income-less’ in relative poverty.  
“Work is the best form of welfare!” was the statement Andrews used. Considering the uptick in unemployment, with industries such as Ford, Alcoa, Qantas, SPC, Sensis, Telstra, Shell and Toyota moving jobs and business offshore, a fall in the participation rate – due in part, to an asset rich, income poor retiring population – and a rise in part time and casual positions over full time positions, concerns are warranted.  
In the 2013-14 federal budget, the government correctly stated that “Australians value a fair society” and underlined its commitment to a tax system that provides a strong and stable funding stream for important public services, such as “health, education and disability care”, while “rewarding innovation and productivity” for economic growth.  On an international scale, our tax-transfer system is perceived as comparatively generous.  
According to the <a target="_blank" href="https://www.oecd.org/">OECD</a>, Australia’s ‘Robin Hood’ economy redistributes more to the poorest 5% of the population than any other member country, whilst the much-criticised policies of middle class welfare are seemingly the lowest.  
We’re deemed to have the most 'unique' and 'target efficient' social security benefits in the OECD, apparently yielding 'significant gains' to both the economy and society. And when compared to the USA, which has the highest income inequality among the ‘rich’ nations by some significant degree, we look comparatively healthy.  
Yet, despite its many reforms, and varying degrees of success, shaped in part by demographic changes (more women entering the labour force, for example) and a small reduction in high end salaries during the GFC, widening disparities between incomes have continued unabated since the mid-1990s. As the labour market struggles, there’s nothing to suggest the trend will stop.  
Mind the gap  
There are all sorts of reasons to narrow the gap between the rich and poor and prevent an ever-widening chasm -one of which is the way that income is invested into the economy and the roll over effect to society.  
Income inequality and economic growth can only work hand in hand when individuals are enabled to strive for greater heights from a foundation of equal opportunity – the basis of which is education.  
As economist and inequality expert Andrew Leigh commented late last <a target="_blank" href="https://www.abc.net.au/worldtoday/content/2013/s3793059.htm">year</a>:  
“Education is the greatest force that we've developed, not only for boosting productivity, but also for making Australia more equal,” ensuring “the circumstances in which you're born don't determine the circumstances in which you die.”  
Yet our schooling system is becoming increasingly segregated. The correlation between poor performance and social disadvantage is stronger here than <a target="_blank" href="https://crawford.anu.edu.au/public_policy_community/content/doc/Australia_Inequality-and-Prosperity_final-15-March-13.pdf">any other</a> comparable Western nation.  If our tax and transfer system were meant to offset this, you’d have to assess its been an abject failure.  
Why?  
Australia has enjoyed a period of economic prosperity, which over the last 23 years has been nothing short of remarkable.  According to Credit Suisse’s Annual Global Wealth Report, we’re the “richest people in the world,” with a median wealth each of US$219,500.  
Over the past year alone, Australia added an estimated 21,000 millionaires to the population. Yet, contrary to what the textbook version of economic theory would have you believe, household savings reaped from an economy surfing the wave of a commodity boom have not flowed into business investment, or nurtured productivity and education standards in the young.  
As noted in the <a target="_blank" href="https://www.credit-suisse.com/ch/en/news-and-expertise/research/credit-suisse-research-institute/publications">Credit Suisse assessment</a>, our riches are "heavily skewed towards real assets” a manifestation of “high urban real estate prices”, acquired and generated through the destructive cyclical impacts of a property market. As I emphasised <a target="_blank" href="https://www.macrobusiness.com.au/2014/02/housing-and-the-inequality-divide/">last week</a>, the gains from income growth and investment flow directly back to the land.  
Both homeowner and speculator  
Home ownership is seen as one of the great pillars of our collective culture.  It’s assessed to improve health and school performance in children, activate social engagement as well as reduce local crime.  
However, the way we go about promoting ownership is to nurture a system that teaches rising land values – outside of any productive activity such as renovation or effective utilisation of the resource – is due reward for having saved hard and got onto the ‘ladder’ in the first place.  
Our tax system is skewed toward ownership, with policies, that according to last year’s <a target="_blank" href="https://grattan.edu.au/publications/reports/post/renovating-housing-policy/">Grattan report</a>, provides potential benefits to home owners worth $36 billion a year, or $6,100 on average per household through items such as capital gains and pensioner eligibility test exemptions. Investors (or those choosing to rent and invest) reap $7 billion a year, or $4,500 on average each, by way of negative gearing rules and the capital gains discount introduced in 1999. Whilst renters, one in four households, see no gain - unless their income is low enough to require welfare assistance.  
In effect, we’re an economy that relies on ever-rising values of irreplaceable fixed assets to fund the individual wealth of its nation – and this is only achievable if policies are in place to ensure values remain high and climbing, and debt levels ‘affordable’.  
Article continues on the next page. Please click below.
     
<hr class="system-pagebreak">
Capital growth  
Speculation and investment are two sides of the same coin. When we assess a good business model for example, we speculate that the productive activity that flows from that investment, will build on a growing base of demand, and through competition and diversity, go onto produce a profit.  
Yet the capital growth in land values does not occur by way of some abject force of nature. Everything that makes our cities liveable comes from the collective investment of our taxpayer dollars to provide the social amenities needed to form the base from which we can all progress.  
This would include: community services such as, transport, parks, roads, trains, trams, medical facilities, and most importantly, schools.  
Yet, it is also these facilities that produce the needed demand for real estate that pushes values upwards.  Not through the efforts of the individual home owner, but the productive efforts of the taxpayer – renter, home owner and investor alike.  
Housing on its own is worth nothing without the infrastructure that surrounds it and rising land values are ‘reward’ for nothing other than unwontedly buying into a system that – under the current structure - promotes inequality and forces <a target="_blank" href="https://www.ahuri.edu.au/housing_information/review/evrev035">social polarisation</a>.  
Unlike our business model above, we can’t ‘make’ more land in a particular location to fulfil the demand produced from the facilities our tax system both funds and maintains.  Therefore effective utilisation of the resource is vital.  
However, the speculative process alone, along with the added impact of a tax system that impedes turnover by way of stamp duty at one end, and capital gains at the other, simply feeds a process of hording.  
This is because most advantage best from investment into housing through the process of “buy and hold” – leveraging the equity to produce needed funds, rather than selling. This is a system that drives underutilisation and ‘land banking’.  
But land is fixed in location; therefore we must always hop over it to find the next predicted hotspot to raise our families, until this too becomes out of reach through the process described above - like a cruel game of musical chairs.  
Back to the beginning  
Let’s go back to the case study I cited at the start of this article.  The reason the four bedroom townhouse attracted such strong demand in the first place, is because it’s located in a top government school zone.  
Only high-income earners can afford to live in this zone and no doubt they feel – through their income tax contributions alone – they pay their fair share toward facilitating the opportunity for their children to obtain that higher education. As the OECD said, our tax and transfer system is high progressive – the “rich” pay more.  Or do they?  
Allowing for stamp duty, the new owner who purchased the townhouse would have paid $1,066,605 yet despite two years of effectively stagnant growth in 2011/2012, the median price in the suburb has escalated close to 60% from $850,000 in December 2009, to $1,355,000, therefore they probably assess it a worthy investment.  
As for those who arrived early in the process, to paraphrase what one home owner relayed to me some time back, she has earned more from the capital growth of her home over the past 10 years or so, than she has in earnings.  
Outside of a market crash or the demise of the education facilities provided, there is nothing to suggest prices in this school zone will drop. From the tight zoning regulations alone and rising population of immigrants and local buyers looking to advance their children’s education, the very ingredients to attract a constant source of buyer demand are set in place – and rents will rise accordingly.  
The taxpayer continues to subsidise the school, whilst the gains are capitalised in rising land values, which flow directly to the individual home owner not the school or community, keeping values high and placing further pressure on the public purse to fund additional services. Meanwhile, underfunded schools in the over populated fringe suburbs, start to produce an English style education class divide.  
Under such a system, we are not subsidising the poor, we are paying the wealthy.  Yet, it’s clear, if we’re to navigate the structural changes ahead and keep unemployment low, whilst at the same time, reduce the projected burden on the ‘welfare state’, our economy is reliant on maintaining a highly skilled work force. For this to occur, an elevated level of tertiary education and business investment is vital.  
A better model of welfare  
Notwithstanding, the correct way to fund local schools would be via broad based and effectively administered <a target="_blank" href="https://www.macrobusiness.com.au/2013/11/land-tax-must-kill-negative-gearing-stamp-duty/">land value taxation</a>. In its purest form, as advocated by the classical economist, Henry George, it would result in a single tax on the unimproved value of land to replace all other taxes which hamper productivity, the most significant being income tax.  
George’s ideas won favour amongst many, including the great economist and author of Capitalism and Freedom, Milton Friedman as well as other influential figures including Winston Churchill, Adam Smith, and more recently chief economics commentator at the Financial Times, Martin Wolf, and author and economist Fred Harrison. Notwithstanding, a single tax would be unlikely to hold water in current political circles.  
The Henry Tax Review commissioned by the government under Kevin Rudd in 2008 concluded that “economic growth would be higher if governments raised more revenue from land and less revenue from other tax bases”, proposing that stamp duty (which is an inconsistent and unequitable source of revenue) be replaced by a broad based land tax, levied on a per-square-metre and per land holding basis, rather than retaining present land tax arrangements.  
Whilst arguments over school funding will likely continue, centred in the political battle over funding of the suggested <a target="_blank" href="https://www.igiveagonski.com.au/">Gonski</a> reforms. Unless we narrow the gap in education, we’ll never narrow the broadening gap in income and consequently, the growing burden on our welfare state.  
Therefore – when times comes that the chatter around affordability finally evolves into real action, a broad based LVT should form an important part of both the debate, and the solution.  
Catherine Cashmore is a market analyst with extensive experience in all aspects relating to property acquisition.
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The tale of one auction – what it really says about Australia's welfare state

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The original Great Southern in Melbourne’s south-east was built 125 years ago, and a new development on the site is seeking to pay homage to its predecessor.
The clifftop Great Southern Hotel was opened by property developers in 1889 to provide a seaside resort for thousands of Melbournians who travelled by horse-drawn tram to the hotel. In the 1920s, it was renamed the Beaumaris Hotel.
The elaborate building burned down in the Beaumaris bushfires of 1944, and rebuilt in 1950 as The Beaumaris.
{yoogallery src=[images/stories/2014/02/24/bea2]}
Now, the site has been converted into 58 apartments. About 60% of the original building has been restored, including its eye catching verandahs. The apartments are selling through Bert Geraerts &amp; Tony Stuart of Kay and Burton, who have put together <a target="_blank" href="https://player.vimeo.com/external/81972562.hd.mp4?s=0ef40ca79e2bb04f747cce2df087f05b">a video on the site’s history</a>.
The development, by Cieran Kayes and designed by Ten32, comes after a <a href="https://www.propertyobserver.com.au/news/historic-beaumaris-hotel-conversion-gets-green-light/2013111266312." target="_blank">three year planning battle</a> with the local council.
Prices range from $450,000 for a one bedroom, one bathroom apartment to $2.3 million for a penthouse in the new development.
<a target="_blank" href="mailto:jrichardson@propertyobserver.com.au">jrichardson@propertyobserver.com.au</a>
            
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New Beaumaris Hotel conversion pays homage to site's storied history

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Games 
While we’re passionate about property we do need to take a break now and then. We relish a bit of fun just as much as the next property nut. True to this spirit we found games with a property spin.
<a href="https://itunes.apple.com/us/app/my-town-2/id442345455?mt=8" target="_blank">MyTown</a> is a game that turns the real world in a monopoly board. Using the iPhone check-in system you can check-in into properties and decide if you want to buy them. Collect rent as more and more people visit the property. It’s really addictive. You can even make overseas investments as you build your digital empire. Plus it’s free. 
<a href="https://itunes.apple.com/au/app/real-estate-rumble/id469054082?mt=8" target="_blank">Real Estate Rumble</a> was created as a marketing tool for First National but it’s a fun little game. It’s simple but a good way to kill time waiting for the agent to turn up.
CommBank’s <a href="https://investorville.com.au" target="_blank">Investorville</a> is a real estate investment simulator where potential property investors can get a feel for what the market is like without risking their own money. It takes real world information and brings it into the game to create a realistic investment environment. With each round of the game there are changes to both the market and your personal circumstances that you must take into account. Thankfully the game doesn’t run in real time and the years skip forward in seconds. Good fun and an easy way to get your head around property if you’re a first time investor.
<a href="https://itunes.apple.com/us/app/millionaire-tycoon/id332424440?mt=8" target="_blank">Millionaire Tycoon</a> is a popular game for iPhone users. Inspired by Monopoly this game takes the idea a whole lot further. It’s good fun if you don’t mind the super-kitsch graphics but it does get progressively harder.
<a href="https://itunes.apple.com/us/app/tiny-tower/id422667065?mt=8" target="_blank">Tiny Tower</a> is a popular game where you build and manage a city tower. The 8-bit game lets you manage every aspect of your new building as you try and tempt new tenants and balanace the needs of everyone in the building.
Forget Angry Birds, <a href="https://in-deed.net/angry_buyers/" target="_blank">Angry Buyers</a> is essentially the same game but you get to load an estate agent, a property lawyer and a mortgage broker into a canon and fire them at shoddily built houses. Brilliant.
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House hunting
After looking at 16 houses on a home hunt they all start to blend into one another. One starts to forget just what exactly they were looking for and whether that Johnston Street property had two bathrooms, or was one just a toilet? You’re not alone in this frustration and a number of developers have stepped forward with various solutions for this problem.
<a href="https://itunes.apple.com/us/app/home-tracker/id311585587?mt=8" target="_blank">Home Tracker</a> is designed for people looking at multiple properties. It allows you to document each property in detail as you visit it as well as take photos, map properties and E-mail property information. It’s also useful for agents keeping track of multiple new properties. It has a niche and it serves it well. It costs $3.99 through the iTunes app store. 
<a href="https://itunes.apple.com/us/app/crumbtracks/id393477924?mt=8" target="_blank">CrumbTracks</a> is a similar offering to Home Tracker and is a perfect tool for people looking so many homes they lose track of them all. The app allows you to take photos and videos of properties you’re interested in.
<a href="https://itunes.apple.com/au/app/house-hunter/id445304335?mt=8" target="_blank">House Hunter</a> app helps keep track of properties viewed on a house hunt. It allows you to rate homes on various scales then filter them later through various features. Homes are rated for various attributes which you can prioritise based on your requirements and these are displayed on a scorecard. If your needs are so unique that are not included in their 80 options you can add them yourself. This gives you a quantitative data and keeps you true to your original goals in a house search. It comes with camera and GPS support.
<a href="https://itunes.apple.com/au/app/property-checklist/id446041813?mt=8" target="_blank">Property Checklist</a> – This is a similar idea to House Hunter with a somewhat simpler implementation. While it might not have the range of features available it is a little bit more intuitive to use, offering a simple yes/no checkbox system.
<a href="https://itunes.apple.com/au/app/360-panorama/id377342622?mt=8" target="_blank">360 Panorama</a> is an app for taking 360 degree panoramic photos of whatever you choose. This is ideal for agents showing properties to clients or for buyers capturing the whole detail of houses for later viewing. It’s not perfect and you’ll never get the results of a professional photographer but it does a very good job for a small cost of $0.99.
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Interior Design 
You’ve bought that old crumbling warehouse and it’s time to renovate, but what look do you go for? Interior design takes a huge amount of creativity and there are tools out there to help get your creativity flowing.
<a href="https://www.houzz.com/" target="_blank">Houzz</a> – The days of ripping pages out of magazines to make an interior design ideas scrapbook are over. This app has thousands of photos of any aspect of interior design one can imagine. This may sound like a nightmare to navigate but the developers have made it incredibly easy to bring up photos of exactly what you are after. Design ideas are arranged by keywords and categories and allow you to quickly and easily view hundreds of interior design ideas to inspire the design of your own house.
<a href="https://remodelista.com/" target="_blank">Remodelista</a> is a website of design ideas. There is post after post after post of beautiful content to get you thinking aesthetically. There are some really great ideas here, interspersed with a few naff ones.
<a href="https://www.dulux.com.au/colour/mycolour.aspx" target="_blank">Dulux My Colour</a> app – Take a photo of any colour and find out what the Dulux paint code is. If you want to paint your house the exact same shade of beige as North Richmond train station, just take a photo of it with this app and it’ll tell you what tin of paint to get. It works pretty well, depending on the lighting.
<a href="https://itunes.apple.com/au/app/handy-man-diy/id392541102?mt=8" target="_blank">Handy Man DIY</a> – This app makes DIY projects much simpler. It helps you keep track of projects around a property, provides guides on how to do certain ventures and helps you calculate materials and costs for various the projects. It’s a simple interface, it makes perfect sense and it makes DIY projects that much easier.
This <a href="https://dickson.ljhooker.com.au/selling/selling-checklist" target="_blank">guide from LJ Hooker</a> is a great way to get a quick overview to improve the look of your house and maximise selling price. 
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Juwai
Juwai is an international property listing site that caters exclusively to Mandarin speakers. It’s just recently launched and has more than 1 million property listings from more than 80,000 agents and developers in the USA, Australia, Canada, the United Kingdom and Japan. It also features guides on living and investing in Australia. It’s entirely in Mandarin and prices are displayed in local currency and Chinese Yuan.
Now it’s not the most beautiful website but the <a href="https://www.firb.gov.au/content/default.asp" target="_blank">foreign investment review board site</a> is required reading for foreign investors in Australia. It includes useful information and application forms for foreign investors.
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Know your agencies
It can be difficult to know which agency to go with when you’re looking to sell or rent your property. They all say they offer great deals and have the most experience in an area. It would be nice to be able to hear how other people found agents and perhaps read a couple of reviews.
<a href="https://ratethatagent.com.au" target="_blank">Rate That Agent</a> is a nice idea but it really lacks the user-base to make it a useful resource. The idea is that once you’ve dealt with a real estate agent, you log on to this website and give them a rating out of five plus a short review. These ratings are then used to rate agents and give sellers some sort of advice on which agents are worth their salt. It’s a nice idea but Property Observer struggled to find any reviews for any agents. It’s a catch-22 – to attract more users it needs a larger user-base.
<a href="https://hometruth.com.au/" target="_blank">Home Truth</a> is another real estate agent rating site but it’s more focussed on renters. Again it suffers from the same problems - there is simply a dearth of reviews. Interestingly it does allow users to review rental properties as well. So on the odd chance someone has reviewed a house or an agent before you move in you can get some warning as to what to expect.
<a href="https://www.productreview.com.au" target="_blank">Product Review</a> is a general review site that has a real estate section. Users reviewing agencies as opposed to individual agents which probably makes the website less prone to defamation law suits as well as a less aggressive atmosphere.
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Landlords and property managers
Landlords often wish to manage properties without the help of an agent. This requires keeping check on rent payments, managing multiple properties, recording communications, finding new tenants and possibly even writing your own contracts.  It’s hard work and not necessarily advised but there are sites and apps out there to help.
<a href="https://www.happyinspector.com/" target="_blank">Happy Inspector</a> - This Australian made app is a simple way to do property inspections very quickly. It takes minimal set-up and allows you to run through properties and generate reports with ease. The software allows you to take photos of damage and keep notes on each property as well as track upcoming and previous inspections.
<a href="https://inventory-pro.co.uk/index.php" target="_blank">Inventory Pro</a> is a similar offering that allows you to take inventories of entire apartment blocks if need be. It has a similar feature set but allows you to take videos as well.
<a href="https://rentmonkey.com.au/" target="_blank">Rent Monkey</a> is a website that automatically creates rental agreements from a series of questions. It works for every state in Australia and is exceptionally simple to use. You should really get the documents sighted by a lawyer just to be on the safe side but it does make renting your own place out much easier. The packs they provide come with all the documents required for your state. So long as your needs aren’t too complicated this is a great website. The site also has an in-depth guide for each state on renting your house out with some solid advice.
<a href="https://gumtree.com.au" target="_blank">Gumtree</a> is a global online classified ad website with localised subsites. If you wish to eschew the whole real estate agency system you can list your own rental property. If you’re looking for a cheap rental property it’s worth having a look on Gumtree. It’s also a great tool for finding house-mates. Anyone can list for free so there’s plenty of options – some better than others. They’ve released an app with a strong function-set.
<a href="https://rentpost.com" target="_blank">RentPost</a> is an innovative piece of property management software. It’s a very easy way to keep track of rent payments, tenant history and property issues. The software works on iPads and iPhones so you can keep track of properties as you go. The cheapest license costs US$9 a month and allows you to track up to 10 properties. The online payment system is currently limited to the USA but there are plans to expand internationally in the second half of 2012.
<a href="https://www.rentingsmart.com/" target="_blank">RentingSmart</a> looks like an exceptionally powerful tool geared towards self-managing landlords. RentingSmart will allow automatic rent payments with full integration with BPAY and bank transfers. They tell us it will help connect landlords with tenants and tradesmen, provide leases, keep track of maintenance issues, expense tracking, condition reports and all this will incorporated into an iPhone application. This could be the be all and end all for self-managing landlords.
<a href="https://pocketrent.com/" target="_blank">Pocket Rent</a> has the same idea but with more of a focus on recording communications with tenants. If you’re running multiple properties it can be a helpful tool to keep track of what issues have been raised which tenants.
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Mortgages 
Visiting a mortgage broker office is a thing of the past with this range of mortgage tools. You can compare mortgage offerings from different banks, calculate loan repayments and see what you can afford.
<a href="https://ratecity.com.au" target="_blank">Rate City</a> allows you to compare home-loans. It stacks banks rates up against each other so you can choose the best value. The site also includes comparisons of savings accounts, credit cards and more so you don’t spend all your money before you even take a loan out.
<a href="https://www.infochoice.com.au" target="_blank">Info Choice</a> is have a similar tool that can compare different loan offerings online.
The <a href="https://www.moneysmart.gov.au/tools-and-resources/calculators-and-tools/mortgage-calculator" target="_blank">ATO has a great tool</a> for calculating how much you can afford to borrow It takes into account your financial situation and possible purchases to give you a realistic amount.
<a href="https://itunes.apple.com/au/app/tapmortgage-australia-mortgage/id402187202?mt=8" target="_blank">tapMortage</a> is a simple app that allows you to calculate mortgage repayments, stamp duty and transfer fees within seconds. It’s perfect for showing clients how much a property will cost them or for working out if a property is within your budget. While not ground-breaking it is a genuinely useful tool. 
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Neighbourhood 
Moving to a new neighbourhood can be an exciting experience but it can take a long time to find out where things are. Where are the good cafes, where are the restaurants, where are the parks, what goes on around here and what’s the arts scene like? There’s no Lonely Planet for <a href="/news">Doncaster East</a> but we do have these multitude of resources to answer these questions.
You should never go to the supermarket on an empty stomach so why should property be any different. You can track down nearby eateries and read reviews to get a solid meal while you’re on the prowl or to work out what’s nearby a possible new home. Having no Thai joint within 2 kilometres could be a deal-breaker.
<a href="https://www.aroundyou.com.au/" target="_blank">Around You</a> is a good website for seeing what sort of events go on in areas. It really thrives with quite suburban suburbs with listings that inner-city publications just seem to miss.
<a href="https://www.google.com/maps/views/home?hl=en-AU&amp;gl=au" target="_blank">Google Streetview</a> is great if you can’t make it to the inspection and just want to have a sticky-beak online. Drive through the suburbs and see if it really is as leafy as the listing makes it sounds. It’s already on the iPhone accessible through the Maps application.
<a href="https://www.urbanspoon.com/c/71/Melbourne-restaurants" target="_blank">Urbanspoon.com</a> is one of our favourite websites and apps we’ve used. It makes discovering places to eat incredibly easy. The user reviews are (usually) quite informative and their price guides are quite accurate. Their app is perfect and we love the idea of shaking the phone and being shown a random selection of nearby restaurants.
<a href="https://www.broadsheet.com.au" target="_blank">Broadsheet</a> is a trendy website which covers the food, drinks and arts scene in Sydney and Melbourne. If you need a place to wine and dine someone or simply a place to eat lunch on the road this website is a treasure trove. They even run an app but it’s currently limited to Melbourne.
<a href="https://thethousands.com.au/" target="_blank">The Thousands</a> are one of the main listings in various cities in Australia. They keep tabs of what’s happening in the arts scenes but we’re including it for its food directory. The app is a good resource for hip local eateries. It works in Sydney, Melbourne, Brisbane, Adelaide and Perth.
<a href="is.http:/itunes.apple.com/au/app/art-guide-australia/id433116687?mt=8&amp;affToken=56102" target="_blank">Art Guide Australia</a> takes your current location and tells you what exhibitions are on around you. Great if you’re moving into an area with lots of galleries or if you want to see how artsy a new neighbourhood.
<a href="https://itunes.apple.com/au/app/wikihood/id317776221?mt=8&amp;affToken=56102" target="_blank">Wikihood</a> takes your current location and draws a bunch of information from Wikipedia to create a little guide. It’s a great way to learn about a new city and see what’s what.
You can also read The A-Z of property apps: Part one.
             
 
 
 
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The A to Z of property apps: Part two

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I know a lot of commentators are complaining about the amount of airtime that Harry Dent gets for his forecasts. But since his publicist kindly gave me some signed copies of his books (and since I am also a voracious reader), let's take a look at what he has to say on Australia's public and private debt.
"Australia is my favourite overall developed country in the world for vacation and for living."
Good-oh. True! We have low unemployment and our cities are amongst the most liveable in the world. Australians are also the wealthiest people in the entire world. 
How's about that? Of all the 200 or so countries you could be living in - which the news reminds us every night includes some countries in desperate strife - you're in the most prosperous of the whole lot. An arresting fact. Australia is also one of the most law-abiding and safer places in which to live.
"Australia has the lowest total debt for English-speaking countries outside Canada at 276%. Australia's government debt is unbelievably low at 21%. Hence, Australia's government will have more room to cushion its banking crisis ahead."
True again. Yes, this is the case. An a resources-exporting nation, Australia really ought not to have high government debt, and nor do we. Should there be an economic downturn, there is scope for government spending on infrastructure to be ramped up, interest rates to be cut, stimulus packages to be hurled at consumers, and so on.
It's becoming increasingly clear from ASX releases that the scaling back in mining capex is now right upon us with a large number of major construction projects now completed. A little later than expected, but we're into the downturn.
As Dent notes, the Australian government has some fuel in the tank if it's needed. The Reserve Bank forecasts Australia's GDP growth to increase to around 4% over the next few years, so at this juncture, stimulatory government spending does not appear to be what is required.
I also note that we don't have a "banking crisis" at this point in time, with the major banks recording another year of earth-scorching results. Dent is forecasting here that an eventual fall in dwelling prices will result in a crisis for the banks. We'll have to wait and see on that, but banks have been steadily building equity in recent times, albeit with material exposure via their residential home loan books.
Events of the last half decade in other developed countries have shown that banks have endured some large write-downs on non-performing loans. Fortunately, the average Australian is miles <a href="https://petewargent.blogspot.com.au/2014/01/will-our-banks-equity-be-wiped-out-by" target="_blank">ahead on their mortgage repayments</a> (at record levels) at this point in time, and non-performing loans have remained very low to date.
Simply leaving mortgage repayments at 2008 levels (the official cash rate in March 2008 was 7.25%) has allowed many of us to open up a huge buffer on required loan repayments. The cash rate of just 2.50% has delivered a colossal affordability dividend to Australian home owners. The mortgage repayment statistics (and, for that matter, retail sales galloping along at a 6.5% annualised growth pace) clearly show that Aussies are enjoying a time of very easily affordable living. Not in line with what you read in the press? That's mainly because modern lifestyle expectations have shifted dramatically over the past generation.
Read what the <a href="https://www.abs.gov.au/ausstats/abs@.nsf/mediareleasesbytitle/2E33320E030F1DEACA25696E007FDE66?OpenDocument" target="_blank">actual statistics are saying</a>. For example, more Aussies than ever before have funds in hand for overseas travel, recording a blistering 8.4 million overseas trips in 2012-13 - comfortably the highest level of overseas trips ever recorded in Australia.
<img src="https://dev.propertyupdate.com.au/wp-content/uploads/2013/12/graph-1.16.gif" width="470" height="505">
One of the key factors for this chart going forward will be the rate of unemployment.
"Australia's consumer debt at 105% is higher than that of the US and most other developed countries as it has the highest average real estate valuations among Western countries. All of its major countries are on the coast with very limited land for development as most of the land is very arid."
True. This is an accurate geographical lesson. I learned this at junior school actually - "Australia is mainly just a large desert" - the text-books told us exactly that. Memorably, we also learned that Australia also had "very large bananas". It's funny the things, you remember. In fact, it was only when Neighbours and Home and Away came to the UK in the 1980s that Poms like me realised that Australia might be quite a nice place to live.
In truth, national comparisons of consumer debt are next to useless. It's very cheap to live in Memphis, but not at all so in Manhattan (or, indeed Mayfair). Similarly, <a href="/news">Dubbo</a> or <a href="/news">Dandenong</a> may be quite cheap on a national basis, but that's not necessarily much use if you earn lower than average wages, or for that matter, if you want to live in Darwin or <a href="/news">Dover Heights</a> or <a href="/news">Double Bay</a>. I don't think we learn much from that.
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You can only really assess how owners are coping with affordability on a localised basis. Broadly speaking, Aussies are enjoying ultra-cheap mortgage repayments, but new buyers are finding deposits harder to save. At this stage of the cycle, lending standards appear to be easing. 
<img src="https://www.rba.gov.au/speeches/2013/images/sp-so-230413-graph11.gif" width="394" height="400" style="display: block; margin-left: auto; margin-right: auto;">
 
The land for development is far greater in cities like Adelaide and in regional centres, of course. Sydney is hemmed in on all sides, which is creating a huge upwards pressure on land values.
"Australia went through the first crash without a subprime or banking crisis."
True again. Harry might have chosen to add 'contrary to my predictions of a 50-55% crash by 2014', but we'll let that one slide. Australia will eventually get a correction, but it won't be of that magnitude in the major capital cities. In fact, Dent has downgraded his crash prediction to less than half of his earlier call from three years ago.
"Housing prices didn't fall much then went a bit higher. Now they're starting to crack on the high end will finally fall in the years ahead."
False. In inflation-adjusted terms, all Australian cities except for Sydney are below their 2010 peaks. And here's a sale from this week - $1.325 million over reserve. Prices are not cracking at the top end at this point in time. The years ahead, of course, are uncertain, as always.
"No normal worker I've talked to in Sydney could afford to own an apartment in the downtown area. It's mostly international buyers and foreigners buying upscale households, as in London, Vancouver and New York".
Hmm, maybe - it depends who he spoke to and what you define as a "normal worker". I own "downtown" property and consider it very easily affordable to me - but then, I'm from a dual income household. 
I also have a large number of friends, none of whom are foreigners, who own "downtown" properties on Pitt Street, Market Street and so on. Being of that ilk, however, most of my city-based friends work in mining or are finance professionals, which is probably not how you would choose to define a normal worker.
Of course, as is the case in most maturing city markets, one wouldn't expect that your average manual labourer could afford to live "downtown", but then this kind of misses the point since most Aussies don't want to live in the city anyway. Most of us seem to want to live in lifestyle suburbs close to the cities, industrial zones tend to be located further out, and so on and so forth.
Where I live, a couple of minutes walk to Darling Harbour and the city, most people seem to be dual income apartment dwellers in the 25-35 age bracket. They generally work in the CBD and most seem to be living the dream at the moment, since interest rates are as low as most have ever seen. The trendy bars, restaurants, coffee houses and takeaway parlours around here are absolutely packed to the rafters seven days a week.
I'm sure life won't be quite so easy when they try to trade up to a house in the suburbs, though, particularly if borrowing rates revert higher. Personally, my best assessment is that Sydney will get a period of strong price growth in 2014, followed by an eventual cooling when interest rates eventually revert higher towards a neutral setting, whenever that may be.
"Australia should weather the coming crisis better than any country in the developed world, but it won't avoid a crash next time around like it did this time. That said, if I have a choice of anywhere to live in the next ten years in this kind of winter season and financial crisis - especially in the next two years from 2014 to 2015 Australia would be my first choice."
A bit of a contradiction? Australia "won't avoid a crash" but it will be the best place to be of "anywhere" to live in the entire world over the next decade. I tend to agree on the latter point. Australia has favourable demographics, and a bright future. That's why a lot of us choose to live here.
As for the crash, well, Dent was completely wrong last time, but time will tell, I guess! He's often said that Australia will lead the boom to follow the crash, so I suppose that I should tell you that any investment decision - be it in equities or real estate - ought to be a long-term gig.
A couple of people have emailed me and asked why I don't appear to take his predictions too seriously. Well, the truthful answer is that I did learn a few things from reading the books, but as for the predictions, no, of course not - his track record has been wildly inaccurate.
In any case, a lot of it is just textbook snake oil salesman content. Quote:
"What could sunspot cycles have to do with stocks? The solar radiation we receive from the sun is higher when there are more sunpots...and that radiation is enough to interfere with satellite and communications infrastructures. The magnetic pole of the sun reverses with this cycle...it might affect human energy and emotions..."
And so it goes on. Cue the obligatory chart which proves that sunspots cause recessions. You might just as well plot a chart of Scottish witchcraft convictions from 1560-1630 or use a pack of tarot cards.
Absolutely textbook stuff.
There is also a large amount of classic technical analysis snake oil thrown in for good measure.
In truly exemplary fashion, there are also the charts of Gouda bulb/tulip mania and the South Seas (sic) bubble, with a few numbers randomly interspersed at various points denoting the <a href="https://stockcharts.com/school/doku.php?id=chart_school:market_analysis:elliott_wave_theory" target="_blank">Elliott Wave</a>, i.e. this proves that all bubbles behave in precisely the same manner in five predictable waves.
The Elliott Wave is then routinely applied to any and every chart.
Having worked for some years in the copper mining industry and been responsible for preparing projections and variance analyses reliant on copper spot price movements, I was particularly interested to read Dent's outlook for the copper price.
I know some people believe you can read charts with no consideration of fundamentals, but if any commodity price should be based on fundamentals as much as technical analysis, it should be Dr. Copper. Nevertheless:
"...a clear fifth-wave peak in copper around $460/lb in April 2011 followed by an A-wave crash to $300 in late 2011. The B-wave peaked near $400 and has fallen just below $300 in mid-2013. The C-wave crash will continue again if copper breaks below $295 and then will probably take copper to around $125 by early 2015, a 73% decline from the peak."
There then follows a chart, apparently sourced from Bloomberg, showing copper's run-up from below $100/lb to $450/lb.
All sounds very impressive and technical until you apply the common sense test. Basic intuition should tell you that copper has never been worth more than a few dollars per pound. If it was actually selling at $325/lb we'd have retired as super-wealthy magnates years ago. Either that or we'd probably be out scavenging for copper materials on building sites somewhere.
Unfortunately, the 'analysis' has been applied to a bogus chart, with some major decimal point issues going on (Bloomberg, unlike other sites quotes copper in USd/lb).
Of course, it's a load of old bunkum designed to sell books, and the same approach is applied to real estate, stocks, wages, bond prices, spending cycles and so on. A good read for a laugh, but no, I wouldn't take it all too seriously.
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>' is out now.
                    
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Should we really believe Harry Dent on Australia's public and private debt?

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There’s a lot more to a good retail space than a pretty storefront. The best retailers engage the customer's senses, guide them through the store, and most importantly, keep them there. Here's our list of the world's top five retail spaces.
Livraria Lello and Irmão, Porto, Portugal
{yoogallery src=[images/stories/2014/02/24/por]}
Photos courtesy of <a href="https://blog.paperblanks.com" target="_blank">Paperblanks</a>.
Portugal (let’s face it – the world’s) most beautiful bookstore is the stuff dreams are made of. A kind of Willy Wonka’s factory for books, Lello and Irmão’s neo-gothic interior has a surrealist bent, thanks to its iconic undulating staircase. The store’s incredible details include floor to ceiling arched bookcases, fan vaulting and stained glass windows. The store itself has become a literary influence - rumour has it that Lello and Irmão’s was part of JK Rowling’s inspiration for Hogwarts.
The Livraria Lello and Irmão was designed by Xavier Esteves.
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Longchamp La Maison Unique, SoHo, US
{yoogallery src=[images/stories/2014/02/24/new]}
Photos courtesy of <a href="https://www.heatherwick.com/la-maison-unique/" target="_blank">Heatherwick</a>.
The sculptural stairs in Longchamps SoHo flagship store are so unusual that they’re the subject multiple features in engineering and architectural magazines, while their designer, Thomas Heatherwick, is the subject of a BBC documentary entitled The Ingenious Thomas Heatherwick.
Rubber covered steel ribbons cascade down the stores walls to form the waterfall-like stairs, which are lit from a central skylight. The staircase’s wide and winding path also allows products to be displayed on top and below, while dividing the store. Heatherwick was also clever enough to avoid using a balustrade that would detract from his work, choosing wavy sheets of transparent glass.
Visible from the street, Longchamp’s staircase entices shoppers inside – once they’re there, the structure serves to guide them around the space.
If there’s a better example of unity between form and function in architecture, we’d like to see it.
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Best Products, various cities, US
The next entry on our list is a bit of an anomaly – not only is it actually a series of buildings, but we haven’t (save for one exception) seen what they look like on the inside.
Best Products was a chain of hardware stores across the US that allowed customers to order items off a catalogue in the pre-internet age and then come to a counter at a warehouse to inspect their product before taking it home. As a result, the suburban stores tended towards the dull and rectangular. The owners, who were apparently art aficionados, decided to engage SITE architecture to re-invigorate their buildings between 1971 and 1984. 
The results? A group of witty, engaging and unforgettable buildings, as you’ll see in the pictures and short film below. The website Architcture and Branding also <a target="_blank" href="https://architectureandbranding.wordpress.com/2012/03/01/architecture-branding-the-utilitarian-box-store-and-design-fodder-known-best/">explains the full history of Best store designs</a>.
<img height="293" width="470" src="https://architectureandbranding.files.wordpress.com/2012/03/best-peeling-site.jpg?w=460&amp;h=287" title="Best Peeling SITE">
Best Peeling showroom, 1971 (source: siteenvirodesign.com) 
  <img height="293" width="470" src="https://architectureandbranding.files.wordpress.com/2012/03/best-indeterminate-facade-site.jpg?w=460&amp;h=287" title="Best Indeterminate Facade SITE"> Best Indeterminate Facade showroom, 1974 (source: siteenvirodesign.com)
 <img height="293" width="470" src="https://architectureandbranding.files.wordpress.com/2012/03/best-notch-cl-site.jpg?w=460&amp;h=287" title="Best Notch cl SITE"> Best Notch (closed) showroom, 1975 (source: siteenvirodesign.com) 
  <img height="293" width="470" src="https://architectureandbranding.files.wordpress.com/2012/03/best-notch-op-site.jpg?w=460&amp;h=287" title="Best Notch op SITE"> Best Notch (open) showroom, 1975 (source: siteenvirodesign.com) 
  <img height="310" width="470" src="https://architectureandbranding.files.wordpress.com/2012/03/best-tilt-profile-view.jpg?w=440&amp;h=290" title="Best Tilt profile view"> Best  Tilt showroom, 1976 (source: seventeeneleven.com) 
  <img height="293" width="470" src="https://architectureandbranding.files.wordpress.com/2012/03/best-antisign-site.jpg?w=460&amp;h=287" title="Best AntiSign SITE"> Best AntiSign showroom, 1978 (source: siteenvirodesign.com)
 <img height="293" width="470" src="https://architectureandbranding.files.wordpress.com/2012/03/best-cutler-ridge-site.jpg?w=460&amp;h=287" title="Best Cutler Ridge SITE"> Best Cutler Ridge showroom, 1979 (source: siteenvirodesign.com)
 <img height="293" width="470" src="https://architectureandbranding.files.wordpress.com/2012/03/best-forest-site.jpg?w=460&amp;h=287" title="Best Forest SITE"> Best Forest showroom, 1980 (source: siteenvirodesign.com)
 <img height="293" width="470" src="https://architectureandbranding.files.wordpress.com/2012/03/best-inside-outside-site.jpg?w=460&amp;h=287" title="Best Inside Outside SITE"> Best Inside/Outside showroom, 1984 (source: siteenvirodesign.com)
<p style="margin: 0px 0px 1.5em; padding: 0px; border: 0px; outline-width: 0px; font-size: 1.167em; vertical-align: baseline; line-height: 1.5em; color: #516064; font-family: 'Helvetica Neue', Arial, Helvetica, sans-serif;"><img style="margin: 0px 0px 15px; padding: 0px; outline-width: 0px; background-color: transparent;" height="176" width="470" src="https://architectureandbranding.files.wordpress.com/2012/03/best-langhorne-pa.jpg?w=460&amp;h=172" title="Best Langhorne PA">
Best Langhorne Pennsylvania showroom (source: VenturiRauchScottBrownArchitect.com)
{qtube vid:=sxPuM4w3c2g}
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Aesop, Adelaide
<img alt="Adelaide-feb-24" height="293" width="470" src="/images/stories/2014/02/24/Adelaide-feb-24.jpg"> 
A worthwhile Australian contender, skincare brand <a href="https://www.aesop.com/au/article/aesop-adelaide" target="_parent">Aesop’s Adelaide store</a> somehow makes 7560 brown bottles look stylish. This isn’t the first time Australian architects March Studios have incorporated Aesop’s product packaging in their interiors – the company’s <a target="_blank" href="https://static.dezeen.com/uploads/2011/01/dzn_Aesop-at-Merci-by-March-Studio-3.jpg">Flinders Street store</a>, in Melbourne, features piles of cardboard boxes held to the wall and ceiling with netting, creating a sort of post-apocalyptic urban cave.
The beauty of the Adelaide store is in its simplicity – with the repetition of a single, unadorned object, the otherwise bare store is given new texture, shape, colour and light. We recall the ceiling of <a target="_blank" href="https://www.highsnobiety.com/files/2013/12/undercover-store-hong-kong-renewal-1-960x640.jpg">Tokyo’s UNDERCOVER store</a>, which uses lightbulbs to a similar effect. The Aesop store’s single elegant display unit is a winner too; its height reminds us of hours spent pouring over CDs and LPs in the local record store.
It’s unsurprising that an Aesop store has made our list – the brand seems to be making an effort to showcase the work of some of the most exciting young architecture firms in the world. As Aesop’s founder, Dennis Paphitis said, “there's a direct correlation between interesting, captivating store spaces and customer traffic within a store."
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Ann Demeulemeester, Seoul, Korea
{yoogallery src=[images/stories/2014/02/24/soe]}
Photos courtesy of <a href="https://www.dezeen.com/" target="_blank">De Zeen</a> magazine.
The Seoul store of fashion label Ann Demeulemeester pulls off the contrast between modernity and nature with aplomb. The entirety of the building’s vertical surfaces, save its windows, are covered with densely-packed green foliage. In Seoul’s built up Gangnam district, the building provides a sleek urban oasis.
The building’s simple lines and colour scheme still manage to offer plenty of variance while keeping to its minimalist aesthetic. Inside, the living façade continues, with thick green moss covering the walls along the staircase that leads down to the building’s basement store. Anne Demeulemeester’s ground floor space maximises the greenery, with floor to ceiling windows offering views of foliage.
The Anne Demeuelemeester store, designed by Korea’s Mass Studies, is another on our list that features a wave motif, with a concrete ceiling that subtly rolls and swells across the space. Hopefully, this will put an end to the misconception that minimalist commercial spaces have to be severe.
 
Honourable mention: Maison Martin Margiela, Beijing
Because the only thing better than Thomas Heatherwick's stairs would be a slide.
<img src="/images/stories/2014/02/24/beijing_feb_24_one.jpg" width="470" height="626" alt="beijing_feb_24_one">
 
 
<a href="mailto:jrichardson@propertyobserver.com.au" target="_blank">jrichardson@propertyobserver.com.au</a>
                         
 
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The top five best retail spaces in the world

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Almost two years has passed since the property market kicked in again and commenced another cycle of growth. Looking back at how the market performed over this period, a larger proportion of home sales crept into the higher price brackets.
2013 ended as a strong year for the property market where a healthy increase in house and unit sales coupled with a rise in home values of 9.8% across the combined capital cities was recorded. We saw median selling prices of capital city homes increased by a greater 10.2% over the year, indicating a shift to more expensive properties transacting throughout the year.
<img alt="rp-data-feb-13-one" height="238" width="470" src="/images/stories/2014/02/13/rp-data-feb-13-one.gif">
An analysis of Australia’s combined capital cities revealed that there is quite a difference in pricing between houses and units where only 27.1% of capital city houses sold for less than $400,000 in 2013 compared to 39.4% of all units.
<img alt="rp-data-feb-13-two" height="244" width="470" src="/images/stories/2014/02/13/rp-data-feb-13-two.gif">
For the same period, unit sales between $200,000 and $400,000 accounted for the greatest proportion of sales in 2013 at 35.7% while sales ranging from $400,000 to $600,000 accounted for the greatest proportion of house sales at 34.2%. Across the combined capital cities, 12.4% of house sales and 4.6% of unit sales were at or above $1 million.
At a combined capital city level, 27.1% of house sales were at prices below $400,000 compared to 63.8% across the regional markets. Similarly, 74.8% of all regional unit sales were below $400,000 in 2013 compared to 39.4%.
The proportion of home sales with a million dollar price tag or higher was lower in regional markets with just 1.7% of all regional house sales and 2.3% of regional unit sales at a price in excess of $1 million.
<img alt="rp-data-feb-13-three" height="338" width="470" src="/images/stories/2014/02/13/rp-data-feb-13-three.gif">
For state-based house sales, the proportion of homes sold below $200,000 and between $200,000 and $400,000 is greater in regions outside of the capital cities or ‘rest of state’ as it is often referred to.  This highlights the fact that home prices are typically lower in regional markets than those in capital city areas.
<img alt="rp-data-feb-13-four" height="338" width="470" src="/images/stories/2014/02/13/rp-data-feb-13-four.gif">
The results for regional unit markets are similar to those for regional houses. The proportion of unit sales below $200,000 in regional areas is much greater than the proportion within the corresponding capital city.
Interestingly, in Australia’s two most affordable capital cities, Adelaide and Hobart, the proportion of unit sales between $200,000 and $400,000 is greater within the capital cities than within the regional market which is likely due to the fact that unit markets outside of these capitals have little depth of stock.
Relative to rest of state markets, the data highlights that the selling prices of homes in capital cities is significantly higher. With around 66% of Australian’s living within a capital city it is clear that competition for housing, particularly well located housing, is driving up selling prices - the current low mortgage rates are only intensifying this competition.
Across each city there are still homes selling at prices below $400,000 however, these homes are becoming rare and are usually located on the outskirts of the city in areas that are poorly supported by essential infrastructure.
Perhaps businesses and governments should be looking at ways to create jobs in regional markets as a way of making housing more affordable. At the moment, there seems to be lack of enthusiasm at all levels of government to provide a sustainable fix to housing affordability in our capital cities. As a result we would expect that the proportion of homes selling below $400,000 will continue to decline over the coming years.
Cameron Kusher is senior research analyst at <a target="_blank" rel="nofollow" href="https://www.myrp.com.au/">RP Data</a>. 
    
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Fewer homes selling across affordable price points and disparity will only grow

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In recent years, job insecurity among young people has risen to unsettling proportions. Last year, <a href="https://www.economist.com/news/leaders/21576663-number-young-people-out-work-globally-nearly-big-population-united" target="_blank">The Economist</a> reported that as many as 290 million 15-24 year olds were not participating in the labour market — “nearly as large as the population of America”.
According to the <a href="https://www2.ilo.org/global/research/global-reports/global-employment-trends/youth/2013/lang--en/index.htm" target="_blank">International Labour Organisation</a>, 73.4 million young people – 12.6% – were expected to be out of work in 2013, an increase of 3.5 million between 2007 and 2013. Alongside this figure is “a proliferation of temporary jobs and growing youth discouragement in advanced economies; and poor quality, informal, subsistence jobs in developing countries”.
In Australia, the figures are less pronounced but still striking. As the <a href="https://www.actu.org.au/Images/Dynamic/attachments/6637/Lives%20on%20Hold%20-%20Unlocking%20the%20potential%20of%20Australia%E2%80%99s%20workforce.pdf" target="_blank">Independent Inquiry into Insecure Work</a> pointed out, casual work is concentrated among young people. One fifth of all casual workers are aged 15-19 and from 2001 to 2011 the prevalence of casual work increased significantly for this age group and to some extent for 20-24 year olds for the period, but far less for older age groups. Underemployment, defined by the ABS as part-time workers who are available to do more work, <a href="https://www.fya.org.au/wp-content/uploads/2013/09/FYA_HYPAF-2013_Digital1.pdf" target="_blank">rose significantly</a> following the global financial crisis and this trend has not abated.
Trends in youth employment
Five trends are worth noting. First, since the 1980s the number of full-time job opportunities for teenagers has been steadily declining.
Second, there has been an increase in the uptake of casual and part time work by young people in general (aged 15-24). As I have <a href="https://theconversation.com/youth-face-snakes-and-ladders-on-the-path-to-full-time-employment-10677" target="_blank">written elsewhere</a>, many want to work more but are unable to do so.
Third, beyond the impact of economic downturns like the financial crisis, globalisation is creating challenges for young people seeking work in Australia. As Bob Birrell and Ernest Healy <a href="https://theconversation.com/scarce-jobs-migrants-or-locals-at-the-end-of-the-job-queue-17496" target="_blank">pointed out last year</a>, young working holiday makers from overseas are intensifying competition for jobs with young local workers. Particularly vulnerable are those “without post-school education, who are seeking less skilled, entry-level jobs.”
The stark nature of competition for jobs globally is best illustrated in the book <a href="https://web.worldbank.org/WBSITE/EXTERNAL/TOPICS/EXTEDUCATION/0,,contentMDK:22670727~menuPK:282391~pagePK:64020865~piPK:51164185~theSitePK:282386,00" target="_blank">The Global Auction</a>. The authors note a German website advertising “cleaning, clerical, and catering jobs…offered by employers with a maximum price for the job; those looking for employment then underbid each other, and the winner was the person willing to work for the lowest wages”. In a highly competitive global labour market, could this be the future of working life?
Fourth, Birrell and Healy also highlight that a growing share of local workers aged 55 and over are staying in the workforce. Between May 2003 and May 2013, the share of those aged 60-64 in the workforce increased from 39% to 54%. This increasing competition for work particularly affects young people who are qualified but lack experience.
The final trend arises from a global mismatch between skills and jobs. A <a href="https://m.afr.com/p/australia2-0/young_underemployed_and_unwanted_wI5z7fLh6loFWKePz74sJJ" target="_blank">number of business surveys</a> confirm the perception that young people are underprepared for working life – ranging from foundational skills in literacy and numeracy, to soft skills such as communication and problem solving. The need to better develop these skills – though valuable – could also reflect a wider need to prepare young people for a world of insecure work. Serving as a kind of adversity capital that enables young people to be more adaptive, flexible and resilient, they also reflect the need to prepare young people for more fluid working lives in which the conventional notion of a career is obsolete.
Is full-time work becoming out of reach for young people?
Working life in general is increasingly competitive and “fluid”. The <a href="https://www.fya.org.au/wp-content/uploads/2013/09/FYA_HYPAF-2013_Digital1.pdf" target="_blank">rate of casualisation</a> across the Australian workforce increased from 18.9% in 1988 to around 25% in 2012. The levels of “non permanent” work and extent of casualisation are hotly contested, with many claiming casual work is valued by young people. It <a href="https://www.afr.com/p/insecure_work_claim_union_beat_up_BBih9jxHDIO4LIPz4pjZnJ" target="_blank">is argued</a>, for example, that “casuals do not want to lose their flexibility or their casual loading”, or that casual work is preferred “as it allows [casual workers] to take part in the workforce and balance family responsibilities or study commitments”.
But a question arises as to whether secure work awaits those ending their post-school study and training. Teenagers in part time jobs are <a href="https://www.fya.org.au/research/how-young-people-are-faring-2011/" target="_blank">statistically</a> only slightly more likely to move into full-time employment than those who are unemployed and since the latter half of the 1980s, the age at which young people enter full-time work has increased. Increasing levels of education amongst young people overall mean that those with poor education outcomes are likely to struggle in the labour market, but insecurity is not confined to those without sufficient qualifications.
There is no doubt that some young people prefer casual and part-time work because of the benefits that flexibility offers. But in the overarching context of labour market change, while things <a href="https://www.fya.org.au/wp-content/uploads/2013/09/FYA_HYPAF-2013_Digital1.pdf">do get better</a> past the age of 25, it would appear that for many, the option to secure full-time work is out of reach.
Lucas Walsh is associate professor and associate dean (Berwick) at the faculty of education at Monash University.
This article was originally published on <a href="https://theconversation.com">The Conversation</a>. 
 
<img width="1" height="1" alt="The Conversation" src="https://counter.theconversation.edu.au/content/22311/count.gif"> </body></html>

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