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

Joel Robinson

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

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

How Sterling Global designed 623 Collins from Melbourne's history

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

Three 82 brings boutique four-bedroom townhome collection to Ivanhoe

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

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

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

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

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

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

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

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

Every First Home Owner Grant for new property by state

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

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

Staff Writer

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

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

alisonwarters@gmail.com

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

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

Ellen Walker

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

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

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

<html><body>
The weekend offering at 4 Lincoln Avenue, Glen Waverley sold for $1,100,888 at onsite auction.
It appeared the Biggin &amp; Scott agency exquisitely timed the auction listing for the February 8 Saturday of the ?????? (Chinese New Year).
I am is aware it did fail to sell during last year's private treaty campaign which kicked off in October - and nothing came from its sale by fixed date January 13, 2014 marketing strategy either.
The final auction bid included the number 88 – the Asian symbol of good fortune and good luck.
Though I wonder just who was the luckiest.
<a href="https://www.propertyobserver.com.au/https://glenwaverley.bigginscott.com.au/property/details/62" target="_blank">It sold through Biggin &amp; Scott agents Ming Xu and Joe Monea.</a> 
Set in a quiet tree-lined, no-through road, the four bedroom house sits within the sought after Glen Waverley Secondary College Zone in the City of Monash. 
The 702 square metre property was also presented as an opportunity for developers.
The marketing kicked off last October, with vendor Alex Paszkiewicz's decision to list followed the death of his mother earlier last year.
It was the 1960s home that he and his sister grew up in, he told the local paper.
When he was inviting agents to pitch for the listing last October, under no time pressure to sell. With the gut feeling that prices will continue to rise into this year, one local agent indicated to him they had 46 buyers for every local property.
Agents had also indicated family homes were selling before it was official listed - sometimes within a day.
<a target="_blank" href="/news">Glen Waverley's current median house price is $778,000</a>, according to RP Data.
Local agents say families of Chinese descent have bought about 25 of the street's 70 or so homes since the initial acquisition in 1993.
The street's previous highest sale was $1.85 million in 2012, one of six sales above the $1 million mark in the past two years.
{yoogallery src=[images/stories/2014/02/14/glen]}
Also on the weekend Trevor Fernandes of Ray White sold a four-bedroom, three-bathroom house at <a target="_blank" href="https://www.realestate.com.au/property-house-vic-glen+waverley-115789327?">92 Capital Avenue, Glen Waverley</a> (pictured above) which was in the Highvale Secondary College zone.
It was sold for $851,000 - well over its reserve of $750,000 after bids from eight parties. That lucky number again!
news@propertyobserver.com.au
</body></html>

jchancellor-FAypfDUnLy

Happy Chinese New Year as 1960s Glen Waverley house sells for $1,100,888 on lucky third attempt

<html><body>
Leading Sydney auctioneer Damien Cooley's own Sydney home in Naremburn (pictured above) goes to auction today, Valentine Day's 2014.
He says it's not a romantic marketing attempt, but because his auction agency has got 30 auctions to bring the hammer down at on the weekend for estate agency clients.
He certainly does keep a busy schedule as last year his tally was 1,600 plus auctions at Cooley Auctions. And last night he sold all seven offerings through RaineHorneBBDB with the highlight being 1A Strickland Street, Rose Bay which sold for $2.825 million.
But there's no debate today from our commentators who love the merits of selling on Valentine's Day. Better than carnations that will wilt tomorrow.
HE SAID:<img style="float: right;" alt="jc-silhouette-5" height="188" width="125" src="/images/stories/2013/09/06/jc-silhouette-5.jpg">
Much of property purchasing is about emotion. So it could be more emotional than most auctions tonight given the Valentine's Day fervour. This one's even got brotherly love as Damien Cooley has entrusted his brother, Andrew Cooley, to be the auctioneer when 46 Darvall Street goes to auction tonight at 6.30pm.
I recall it was bought by Damien and his wife Peppi in 2006 - just the weekend after they returned from their honeymoon. They bought the Darvall Street property for $775,000 and now have hopes of more than $1.4 million. That's just above the current <a target="_blank" href="/news">Naremburn median of $1.26 million, </a>according to RP Data.
Damien is spreading the love around too with conjunctional agents, the <a target="_blank" href="https://www.realestate.com.au/property-house-nsw-naremburn-115909579">LJ Hooker Willoughby</a> agent John McManus and Peter Chauncey at <a target="_blank" href="https://www.mcgrath.com.au/buy/house-naremburn-nsw-2065/206856/?searchID=36518264">McGrath</a>. They say more than 250 groups had been through during the marketing campaign. And at last count 30 plus contracts issued.
And just between us blokes, Damien actually didn't even realise it was Valentine's Day when the auction date was set. It was supposed to be Friday February 21, but was brought forward one week since the early bird marketing was going great. 
 
<img style="float: left;" alt="mb-silhouette-4" height="188" width="125" src="/images/stories/2013/09/06/mb-silhouette-4.jpg">SHE SAID:
Damien and his wife Peppi have not only extensively renovated the three-bedroom Victorian-style home but also raised their three children Eva, 4, Dax, 3, and one-year-old Tom at the home.
They gutted the house and built up out the back behind its gorgeous facade and quaint fence. The master bedroom has built-in robes and Travertine ensuite with cosy in-floor heating and heated towel rails. And built-in window storage seat.
With its high ceilings, Blackbutt timber floors, plantation shutters and pale neutral palette, it is hard not to absolutely love this house, the aspect and the location, as have the Cooley family who are sad to let the house go, but life changes.
They need a bigger house now and have bought a home in <a href="/news">Artarmon</a>. Buying before you sell is a risk, but not in this market and on this special day. Here's just hoping the rain stays away to make it perfect.
news@propertyobserver.com.au
 
 
</body></html>

Valentine's Day property auctions? He Said/She Said

<html><body>
I'm not against foreign investment and I'm not against the property market increasing in value.  What I don't agree with is the current 'Foreign Investment Policy Settings' in regards to property acquisition by non-residents or non-Australian citizens.
The two main concerns I have are that it's inflationary and that it will create a generation of renters which will result in other knock-on social issues down the track.
Under the current policy, 100% of a new apartment blocks or any new housing with FIRB (Foreign Investment Review Board) approval can be sold to non-residents. As a result of this there is no doubt that we are seeing prices (particularly in our capital cities) being pushed up higher and faster than they otherwise would be without foreign buyers thereby creating an inflationary effect.
As a nation we have prided ourselves on giving all Australians a fair go. In contrast this current situation prices many would be Australian home buyers and investors seeking to secure their future out of the market. It is forcing many to rent now who would otherwise like to purchase and could create a generation where more rent than own diminishing for many the great Australian dream of owning their own home.
The reality is that the property market is strong enough without adding more demand to what is widely reported by several housing bodies as a market that has an under-supply. Currently those stats show the under-supply to be in excess of 200,000 properties and this is increasing.  So there's no question that we have plenty of demand locally without "importing it".
The flow on effects of the current policy must also be examined. We are likely to see a generation that will be far more financially dependent on the government come retirement having not established the financial security of buying and paying-off their own home.
Financial modelling for self-funded retirees (which is the purpose of super) has the assumption that retirees have paid off their home. If they are still renting then it's likely they will require an additional million dollars in super or other investments (be that cash, shares or property) to fund their rental costs, for the rest of their lives.  If they don't then it’s highly likely they will be dependent on some form of government pension or financial support to pay their rent.
It's well understood that once people/families are dependent on welfare it often becomes generational. Clearly more people being dependant on government financial support is not in Australia's long-term interest.
I have written to the PM with my recommendations for adjustments to the policy which would essentially restrict the amount of properties that can be sold to non residents in any one particular development to a less inflationary level of less than 10% and to place a limit on how many properties any one individual non resident can purchase in Australia.
The federal government has the responsibility to create quality, sustainable policy and make adjustments to the current foreign investment rules so that we don't end up with social problems for future generations. I am optimistic that the new government will address this very important issue as it's become increasingly apparent that the current policy needs adjusting.
Patrick Bright is the founder of Sydney-based buyer’s agency <a target="_blank" href="https://%20www.epspropertysearch.com.au/" rel="nofollow">EPS Property Search</a>.
Patrick is the author of four best-selling real estate books known as “The Insider’s Guide to Buying Real Estate Series.”
This article first appeared on <a rel="nofollow" href="https://www.epspropertysearch.com.au/">www.epspropertysearch.com.au</a>.
 
 
</body></html>

pbright-aNtgvRfvJN

Why the federal government must change its foreign investment policy

<html><body>
People often fail to see value if they can’t relate to the setting.
In 2007 a Grammy Award-winning musician - violinist and conductor Joshua Bell - stood in a metro subway in Washington DC and played for 45 minutes on a $3.5 million Stradivarius. Over 1,000 people walked past. Only seven stopped, briefly, to listen. A three-year-old boy was the only person who paid any real attention to the world-class violinist, who two days earlier had sold out a concert hall in Boston at $100 a seat.
{qtube vid:=hnOPu0_YWhw}
This experiment, conducted by a newspaper columnist, created quite a stir at the time, for all sorts of reasons. One was that people generally assumed the musician was no good if he was busking in a railway tunnel. They failed to recognise the quality because of the setting. They missed a unique opportunity for a free concert from one of the world’s best musicians.
The story has real estate parallels. Most investors fail to recognise the quality in property that’s in a setting that doesn’t meet their expectations. Real estate snobs often miss the best investments because they think quality means expensive.
Why would anyone want to live there? Is often heard from people who personally would choose somewhere swankier. The answer, not that they ever stop to hear it, is: lots and lots of people, for all kinds of valid reasons.
Sydney is strong right now and the pattern of sales activity suggests further price growth in 2014. The list of locations recording the greatest increases in sales is dominated by more affordable areas. The municipalities of <a href="/news">Blacktown</a>, <a href="/news">Parramatta</a>, <a href="/news">Canterbury</a> and <a href="/news">Bankstown</a> lead the Sydney pack, although the City of Sydney also has plenty of activity in its apartment markets.
Blacktown City is the individual star. It has a dozen suburbs with strongly rising market activity. This is the population growth leader in New South Wales and one of the most popular areas for first home buyers. It offers affordable homes, good infrastructure, strong transport links and proximity to major jobs nodes.
For these and other reasons, more people are buying there than in <a href="/news">Vaucluse</a> or <a href="/news">Mosman</a>. Many people aspire to live in those silvertail suburbs but that aspiration does not translate into market demand because relatively few can afford them.
Price growth is driven by the weight of mass demand and, overwhelmingly, the great bulk of buyer demand goes to the places with attainable prices. Affordability rules in real estate. Affordability plus infrastructure (such as commuter train links) is one of real estate’s power combinations.
Quality in property investment is not dictated by the luxury features of the property or the prestige of its setting. It’s defined by superior capital growth rates and stronger rental returns.
In Sydney, right now, quality is more likely to mean Blacktown than <a href="/news">Balmain</a>.
There are similar stories to tell throughout capital city Australia. In Perth, the average growth in 2013 was around 8-9% but many precincts did much better than that. They were not the millionaire enclaves west of the CBD beside the river or the beach. They were the affordable areas some distance from the City, including the municipalities of Swan, <a href="/news">Gosnells</a> and <a href="/news">Armadale</a>.
Closer to the CBD, but still relatively affordable, the municipality of <a href="/news">Belmont</a> also delivered strong price growth.
To be a successful investor, avoid the syndrome that was evident in the Washington experiment involving one of the world’s best musicians.
Terry Ryder is the founder of <a href="https://www.hotspotting.com.au/" target="_blank" rel="nofollow">hotspotting.com.au</a>.
You can contact Terry via <a href="https://mailto:%20ryder@hotspotting.com.au" target="_blank">email</a> or on <a href="https://twitter.com/hotspotting" target="_blank" rel="nofollow">Twitter</a>.
 
 
</body></html>

terryryder-YECXbqmri2

A quality property investment is not dictated by prestige or price, but by growth and returns

<html><body>
The forecast is grim for housing affordability in Sydney, according to a recent government <a target="_blank" href="https://www.parliament.nsw.gov.au/Prod/parlment/publications.nsf/0/B3D723202932C63ACA257C61001D07AF/%24File/Trends%20in%20home%20ownership%20-%20FINAL.pdf">briefing paper</a>. In the last decade median rent for all properties in the inner ring of Sydney more than doubled from A$195 to A$560.
We can expect little policy movement on private housing subsidies by the federal or state governments. <a target="_blank" href="https://theconversation.com/explainer-why-negative-gearing-is-bad-policy-21882">Negative gearing</a> has increased the wealth of middle and high income Australians. Developers endlessly lobby governments for taxation concessions. No major political party would dare propose reform.
Whether the Sydney Metropolitan Strategy has been successful in providing affordable housing is debatable. The strategy does more to <a target="_blank" href="https://db.tt/j7ZibMAR">underwrite the problem</a> of housing affordability than address it.
<a target="_blank" href="https://strategies.planning.nsw.gov.au/MetropolitanStrategyforSydney.aspx">The strategy</a>, part of the “Global Sydney” vision from the NSW state government, is almost 10 years old. Updated <a target="_blank" href="https://www.planning.nsw.gov.au/Portals/0/HousingDelivery/Population_projections_Brochure_NSWGrowing.pdf">government forecasts</a> suggest Sydney’s population will grow to 5.8 million by 2031 - approximately 200,000 more people than predicted in 2010.
Young (under 15) and elderly (over 65) people will account for the biggest growth rates. People aged 18-25 are already feeling the housing affordability squeeze. As are elderly private renters.
The Global Sydney vision
The strategy set out plans for the provision of 770,000 additional homes, 760,000 new jobs, and new transport networks to meet the demands of a growing city.
In 2005 the NSW Premier stated in the opening pages of the strategy text:
"Sydney is Australia’s only truly global city and one of the world’s great metropolises."
At the national level, the globalisation of Sydney is inevitable and useful in geo-political and economic terms. But at the local level, the Global Sydney vision leads to costs and benefits for different social groups. The government’s eagerness to position Sydney as a global city has important local repercussions for urban planning and affordable housing provision.
Crucially, it represents a fundamental reorganisation of the way we think about the city. Rather than thinking about Sydney as an urban space within which the rights of the city’s inhabitants might be protected, the global city of Sydney is pitched as facing the harsh economic realities imposed by the global world.
Global cities and urban zones
Central to the vision is an assumption that global cities move foward to betterment. Ideas such as social progress, economic growth, and increased property prices are all contingent on moving the city from its blemished past to an improved future.
In Sydney, this has resulted in a rethink of the purpose of the greater Sydney region. Some sections of the city were promoted as sites that could be used to capitalise on specific locational advantages, such as “growth centres” and “business parks”. Visually, the city was represented as a network of zones made up of a “global economic corridor” connecting the “powerhouse of Australia’s economy” to the “airport”, “major shipping networks”, and the “shopping districts and malls” within the “regional hubs”.
<a style="font-size: 0.8em;" href="https://c479107.ssl.cf2.rackcdn.com/files/40730/area14mp/xcc63v9h-1391567906.jpg"><img width="470" src="https://c479107.ssl.cf2.rackcdn.com/files/40730/width668/xcc63v9h-1391567906.jpg"></a>
<a style="font-size: 0.8em;" href="https://c479107.ssl.cf2.rackcdn.com/files/40730/area14mp/xcc63v9h-1391567906.jpg"></a>The Sydney Metropolitan Strategy highlights key regions for economic activity. NSW Government
The strategy commodifies the urban space of the city. In other words, the various zones of the city are thought of as a tool through which the government might better integrate Sydney into the global economy. But to enable this Global Sydney vision, changes had to be made at the local level.
Urban renewal, housing affordability and privatising public property
Historically, public housing has been a key housing affordability policy mechanism. Evaluated through the Global Sydney vision and metropolitan strategy public housing estates are portrayed as outdated places that are preventing the future economic progress of the city.
NSW Department of Planning and Infrastructure says:
"What do we mean by renewal? Renewal is not simply about increasing housing densities. Urban renewal is about transforming under-used or dilapidated areas…"
Sydney has many underused or dilapidated areas, but how the Department measures these two criteria is important.
For example, in terms of land-use planning, many consider the low housing density profiles of some Sydney suburbs close to the city and transport centres to be an underuse of urban space. “80% of the city will be untouched” by the strategy <a target="_blank" href="https://www.be.unsw.edu.au/sites/default/files/upload/research/centres/cf/CFpresentations/mayorsforumhandouts.pdf">argued</a> Professor Bill Randolph in 2006.
There has been local <a target="_blank" href="https://www.smh.com.au/nsw/public-housing-no-bar-to-property-gains-20131025-2w6zbhttps://www.smh.com.au/nsw/public-housing-no-bar-to-property-gains-20131025-2w6zb.html">resistance</a> to housing affordability programs that threaten to impinge on the housing landscapes of wealthier Sydney suburbs.
In the strategy, measuring an underused or dilapidated area was conditional on the commodification of urban space. A place is defined as underused or dilapidated so that it can be redeveloped to extract a financial return from this undervalued urban commodity.
In the case of public housing estates, they are not defined as dilapidated to provide much needed maintenance, or as underused to increase the public (i.e. affordable) housing supply. Estate redevelopments do not revitalise the rights of poor urban populations.
Instead, they label these urban spaces as “economically unproductive” and the tenants as socially dysfunctional. Both the housing stock and tenants are thought of as dilapidated.
Announcing a public housing estate redevelopment by <a target="_blank" href="https://theconversation.com/funding-the-future-after-the-demise-of-ppps-18869">public-private partnership</a> in 2005 the <a target="_blank" href="/news">state government</a> said, “much of the public housing stock is either at the end of its economic life or requires significant refurbishment”. They suggested that public housing estates were “burdened with more than their share of problems, made worse by low concentrations of private housing”.
During redevelopments, changing the housing-tenure profile or dispersing tenants across the city in pursuit of global city credentials, irrespective of the disruptions to the often long-term residents of these estates, is justified.
Australia needs a new housing vision
The strategy’s criterion for defining urban spaces as underused or dilapidated means public housing and tenants are viewed as part of the city’s dilapidated past. It also reinforces private and non-government housing as part of the city’s global future.
Infilling affordable housing projects into the parts of the city where it is most needed has generated strong local opposition within this context. This threatens the rights of low-income citizens to long-term affordable housing in the city.
Reducing public housing supply, increasing non-government housing supply or providing <a target="_blank" href="https://theconversation.com/why-falling-house-prices-arent-the-calamity-the-media-would-have-you-believe-4547">taxation concessions</a> for mum and dad investors and developers has not addressed the housing affordability problem in Sydney.
Australia needs a new housing vision from which progressive affordable housing policies can be built. A vision that is not conditional on private housing subsidies and the privatisation of public property.
Dallas Rogers is a research fellow with the Urban Research Centre within the University of Western Sydney’s School of Social Sciences and Psychology.
This article was originally published on <a href="https://theconversation.com">The Conversation</a>. Read the <a href="https://theconversation.com/sydneys-global-vision-bad-news-for-local-housing-affordability-22761">original article</a>.
<img width="1" src="https://counter.theconversation.edu.au/content/22761/count.gif" height="1" alt="The Conversation">
</body></html>

drogers-JvoVgMGDGm

Australia needs a new housing vision from which progressive affordable housing policies can be built

<html><body>
The much anticipated housing finance figures for December from the Australian Bureau of Statistics were released this week, and saw an interestingly mixed number of responses.
The drop in the number of home loan approvals had 1300HomeLoan’s managing director John Kolenda saying that this softness highlights the <a href="https://www.propertyobserver.com.au/news/reserve-bank-keeps-rates-on-hold-in-first-meeting-of-the-year/2014020467523" target="_blank">need for the Reserve Bank of Australia to remain on the sidelines</a>.
Meanwhile, ANZ Research’s Paul Braddick and David Cannington pointed to the strength and “solid up-trend” being seen in the market, while noting that the RBA is likely to stay on hold for some time.
And Real Estate Institute of Australia (REIA) president Peter Bushby pointed to the lowest monthly increase, in trend terms, for the number of owner-occupied finance commitments in the past 12 months.
Kolenda said that the RBA needs to be cautious not to dampen the current environment, particularly in terms of consumer sentiment.
“The RBA should leave rates where they are for at least the next six months until we see an improvement in other sectors such as unemployment, which remains an area of concern,” he said.
“Any premature increase in rates is likely to change consumer sentiment back to being conservative.”
Braddick and Cannington’s research said that despite improvement in consumer sentiment through the second half of 2013, and strong retail sales in recent months, interest rates are expected to stay low for an extended period.
“Combined with strong population gains and pent-up home buyer demand, we expect this will maintain solid growth in home sales, prices and finance through 2014. Moreover, rapid growth in finance for residential construction and the purchase of new dwellings foreshadows further gains in building activity into 2014,” they explained.
Further gains are also reflected in elevated clearance rates and the momentum in house prices they said, with further gains in finance commitments expected.
New South Wales is currently leading other states in terms of housing finance growth, likely reflecting the hot market experienced by Sydney last year, with investor finance up 47% over the year to November and owner occupier numbers appearing strong – though they noted it was at half this rate.
Bushby agreed that investors were continuing their strong presence in the market, with almost three years of consecutive increases now being recorded.
He also pointed to the increase of first home buyer commitments, from a record low.
“The proportion of first home buyers in the number of owner occupied housing finance commitments rose from its historically lowest point of 12.3% in November 2013 to 12.7% in December 2013. The figure is alarmingly lower than the long-run average proportion of 19.9%, despite eight interest rate cuts since November 2011,” he said. <a href="/news">First home buyer numbers have been slumping for some time</a>, according to this data.
“December 2013 results highlight the need for Government to act on housing affordability and to stem the rapid decline in the number of first home buyers."
Premier of Tasmania, Lara Giddings, thinks that the strength of first home buyer numbers in Tasmania is attributable to the $30,000 First Home Builder Boost, with new loans to first home buyers up 20.4% for the year.
<div id="content_div_218957">
“Since the First Home Builder Boost was increased to $30,000 late last year there have been more than 70 successful applicants," Giddings said.
“That is on top of the 250 that received the $15,000 grant that formed part of the original Jobs Package."
</div>
See over page for data breakdown
 
 
<hr class="system-pagebreak">
 The raw data 
Trend estimates (percentage change from November 2013 to December 2013)
VALUE OF DWELLING COMMITMENTS
Total dwellings: 1.8
Owner occupied housing: 1.0
Investment housing - fixed loans 3.0
NUMBER OF DWELLING COMMITMENTS
Owner occupied housing: 0.3
Construction of dwellings: 1.1
Purchase of new dwellings: -1.1
Purchase of established dwellings: 0.3
Seasonally adjusted estimates (percentage change from November 2013 to December 2013)
VALUE OF DWELLING COMMITMENTS
Total dwellings: 0.1
Owner occupied housing: -1.5
Investment housing - fixed loans 2.9
NUMBER OF DWELLING COMMITMENTS
Owner occupied housing: -1.9
Construction of dwellings: 0.4
Purchase of new dwellings: -1.9
Purchase of established dwellings: -2.2
Source: Australian Bureau of Statistics
Last month’s housing finance data was also said to be a “mixed bag”. You can see <a href="https://www.propertyobserver.com.au/finance/housing-finance-data-a-mixed-bag/2014011367175" target="_blank">the industry responses to that data set here</a>.
What are your thoughts on the housing finance data? Head to <a href="https://www.propertyobserver.com.au/https://www.abs.gov.au/ausstats/abs@.nsf/mf/5609.0" target="_blank">the full data available on the Australian Bureau of Statistics for more detailed breakdowns</a>.
<a href="mailto:jduke@propertyobserver.com.au" target="_blank">jduke@propertyobserver.com.au</a>
</body></html>

jduke-EHk3XBmHkn

Housing finance data sees mixed responses

<html><body>
The federal government’s National Rental Affordability Scheme (NRAS) is being used as a marketing tool to sell property. The scheme was introduced in 2008 and is designed to help meet the social need for affordable rental housing by encouraging investment in residential property through attractive tax incentives.
The scheme provides a substantial financial incentive of a minimum of $9,524 tax free per house annually to investors, who rent approved houses at 20% or more below current market rates to eligible tenants.
However, NRAS is not an investment scheme per se, it is a housing scheme. It aims to provide affordable accommodation and underpins the government’s drive to privatise public housing.
My concern with the scheme is the regulated choice investors have. Asset selection is limited to new approved developments in areas where there is a need for affordable housing. It aims to supply 50,000 new dwellings and because these are in defined areas where approval is granted there is a risk of clusters of NRAS properties throughout the market. This has the potential to cause oversupply issues down the track.
Further, these developments tend to be in areas where land is available at low cost, which is generally the case when there is limited demand in the area.  However, a key characteristic for capital growth is a high land value and limited supply.
The popularity of NRAS properties is growing as financial planners find ways to market the incentives and make money through their referrals and recommendations. Investors need to be aware that large kickbacks, of 5% to 10% of the purchase price, are being paid to the advisor who is making the recommendation to purchase, and that these kick-backs are simply built into the purchase price of the investment.
I have come across a number of people promoting these schemes and the alarm bells have been ringing. In one example an investor was offered a unit backed by the scheme for $356,000. On paper the investment cash flows looked great but when subjected to greater scrutiny, the property was found to have a market value of closer to $300,000.
Investment schemes that are heavily marketed off the back of cash incentives and tax benefits are nothing new. In recent times we have seen a number of investments that have been sold with a focus on upfront benefits, only to be a disaster down the track.
In the early 2000s a wave of off the plan properties were sold around the country. The lure of stamp duty savings and depreciation benefits were used to attract buyers. Fast forward five years and many of these properties have been re-sold at a loss. In one example a <a target="_blank" href="/news">Docklands</a> property was purchased in 2001 for $582,000, only to be sold in 2006 for $455,000.
Further, the investment time bombs are not limited to the property market. In 2008 many investors got stung investing in agribusiness managed investment schemes such as Timbercorp and Great Sothern. Once again these investments were sold with the enticement of upfront tax deductions. However, when the dust settled, the Australian Securities and Investments Commission (ASIC) was reported to have identified issues with inadequate disclosure of information to potential investors and poor performance of the investments. Once again these investments were sold through financial planning channels where commissions of around 10% were paid.
It is important to point out I am not criticizing the NRAS scheme itself, however investors need to understand the true motivations of the scheme. They should be wary of the marketing machine that uses the scheme to make an investment product look good.
Upfront cash benefits are great but they must be viewed as a bonus. The quality of an asset should be assessed in isolation of any incentives.  If the investment asset does not grow in value, or worse has the potential to lose money, then why bother? In some cases keeping your money and just going on a nice holiday is a better option.
Mark Armstrong and Xavier Perronnet are directors of <a href="https://www.ipropertyplan.com.au/">iProperty Plan</a>, which provides independent analysis and tailored advice to investors and home buyers.
<hr>
RELATED ARTICLES:
I'd rather stick a fork in my eye than buy NRAS: Todd Hunter 
<a target="_blank" href="https://www.propertyobserver.com.au/trends/my-response-to-nras-naysayers-adrian-jenkins/2013091264998?utm_source=po&amp;utm_medium=aida&amp;utm_campaign=news">My response to NRAS naysayers: Adrian Jenkins</a>
Readers respond in defence of NRAS
<hr>
Note: The byline for this article has been updated since publication to reflect the co-authorship.
This article was originally published on Property Observer in October 2012.
 
 
</body></html>

marmstrong-sd3emVLPPb

The NRAS nightmare: It's a housing scheme, not one for investors

<html><body>
The Australian love for the outdoors, and for outdoor entertaining, never ceases to amaze. As such, it appears that the backyard is in many property owners’ sights as the area to renovate for lifestyle and for value-adding purposes.
Canstar Blue, a consumer ratings house, surveyed more than 2,500 people in their annual home and garden research to ask about renovations and future intentions, with 25% of home owners that answered having already renovated their yard over the last three years.
Another 38% of the 1,503 home owners, said that they were considering undertaking external renovations.
Bathrooms were then on the list, with 20% having undertaken improvements over the past three years. Two in five also had an intention to renovate this room.
Those in Queensland, where the climate is sunnier, were most likely to have renovated their yard, at 29%. Meanwhile, in Tasmania and West Australia, the figure sat at just 17%.
Of work undertaken, the most popular items were the following:
Decking or paving: 45%
Repainting: 38%
Changes to lighting: 32%
Interestingly, <a target="_blank" href="https://www.propertyobserver.com.au/victoria/analysis-can-laying-turf-really-increase-your-propertys-value-by-%2475000/2014012867406">despite some claims</a>, adding lawn or turf was not mentioned within the top three.
In the bathroom, common upgrades included:
Taps and sinks: 72%
Repainting: 69%
Replacing showers and baths: 66%
Gen Y were the homeowners that were most into DIY-ing, with 47% saying they had done the renovations themselves, compared to Baby Boomers, 40%, and Gen X, 41%.
Canstar Blue’s Amy Partington said that it appears little is off limits and that we’re still a nation of eager renovators.
“The research also shows that a large proportion of people are doing their work themselves, particularly younger people who may have scrimped and saved for their first home. With this in mind it’s little surprise that consumers are turning to the Internet to research the equipment they should use and to uncover all the advice they can to avoid costly mistakes,” Partington said.
Decking is certainly popular at present and is likely to be on many homeowners' minds as the weather remains hot and the outdoors look ever more tempting. Similarly, new products allow decks to be built even more easily and with less maintenance than previously. There are a number of materials now that also create decks that never rot, as well as a vast selection of colours and styles.
See over page for five homes with inspirational decks
 
 
<hr class="system-pagebreak">
 
Five inspiring deck designs 
When planning your own outdoor decking, it's worth looking to properties that have got it "right" for inspiration. Here are five current listings that have something particularly special in the way they use their decks.
 
{yoogallery src=[images/stories/2014/02/12/hun]}
Seamlessly blending the indoor and outdoor space, the expansive deck on this home provides a fantastic outdoor entertainment area. As the home boasts a 180 degree bushland and water outlook over the Lane Cove River, this is a great way to take advantage of the views.
 
{yoogallery src=[images/stories/2014/02/12/bri]}
Wrapped around the sizable pool, and providing views of the solar heated pool, gardens and vegetable patch, it’s also located under the right amount of shade for comfort. The cut outs for the deck are an unusual but nice feature, allowing trees and plants integrate with the deck.
With a barbecue, and right next to the kitchen and loungeroom spaces, it’s a great functional space.
 
{yoogallery src=[images/stories/2014/02/12/west]}
This decking, which is both inside and out, is a modern, stylish approach that is favoured by many. This is all about flow, and really changing the definition of where the house ends and the garden begins.
 
{yoogallery src=[images/stories/2014/02/12/fli]}
Combining the deck with the transparent glass pool fence provides an excellent useable space that isn’t disjointed by the safety requirements. While the use of furniture here helps define a sitting space, clever positioning of other garden attire can turn the space into something completely different very quickly.
 
{yoogallery src=[images/stories/2014/02/12/bro]}
Providing an extra meal area, and a through-way, this unusual use of decking is elegant, neat, and again blends the concept of where the “house” ends. The main bedroom also has its own private deck. 
 
Have you added a deck or changed your yard? Send in your pictures and ideas to: <a href="mailto:jduke@propertyobserver.com.au">jduke@propertyobserver.com.au</a>
 
 
</body></html>

Outdoor renovations the budding trend: Five decks to be inspired by

<html><body>
Recently released figures implied that the percentage of first home buyers in the market fell from 12.5% in December 2012 to just 10.2% in December 2013, before bouncing a little to 11.2% in January 2014.
I could be proven wrong of course (it's been known!) but I'm pretty confident that the number of first home buyers will be strong enough in 2014. While we're all guilty of at times looking for evidence to support our own preconceptions, today I'll discuss why it is that I think that.
Data from <a target="_blank" href="https://www.afgonline.com.au/news">AFG's mortgage index</a> in January showed that the level of first home buyers (FHBs) was strong in Western Australia (up from 21.8% to 24.2%), pretty good in South Australia (15.5%) and increased in Victoria (up from 8.7% to 11.2%).
However, the data showed that in states with no first home buyer grants the level of FHBs was exceptionally low; such as in Queensland (6.5%) and New South Wales (3.4%). The Reserve Bank's chart below shows how the market looks in historical terms, with the distorting impact of previous grants clearly evident.
<img style="padding: 5px; border: 1px solid #ebebeb; box-shadow: rgba(0, 0, 0, 0.0980392) 1px 1px 5px; display: block; margin-left: auto; margin-right: auto;" src="https://www.rba.gov.au/chart-pack/images/5-6-household-sector/6br-hla-small.gif?accessed=2014-02-10-08-57-41" alt="Housing Loan Approvals graph">
Here are three of the reasons I believe that FHB levels will be strong enough in 2014.
1 - Finance won't get any easier than this
Loan products <a target="_blank" href="https://www.theadviser.com.au/breaking-news/29720-new-fhb-home-loan-launched?utm_source=The+Adviser&amp;utm_campaign=The_Adviser_Bulletin07_02_2014&amp;utm_medium=email">are now available from just 5.79% per annum</a> interest for first home buyers with only a 5% deposit and with no Lenders Mortgage Insurance to be charged. I also just saw a TV advert for 95% first home buyer loans with parental guarantee. When stuff like this starts hitting the popular media, it's a sign of changing sentiments.
Financing probably won't (perhaps I should rephrase that - probably shouldn't) get any easier than this.
Yes, 100% LVR loans were available to first home buyers prior to the financial crisis, but to date I haven't seen or heard any market commentator suggest that the widespread return of 100% FHB mortgages would be a good idea.
Declining lending standards add fuel to markets that are already inclined to be irrational and are likely to lead to financial instability. Encouraging buyers with no track record of saving to leverage up when interest rates are at generational lows, could easily lead to a proliferation of non-performing loans down the track.
In any case, while previously available 100% mortgages may have been great for those who used them, the appeal must have been somewhat diminished by being slugged by up to $15,000 (or on occasions even more) of lenders mortgage insurance (LMI), even if it was possible to capitalise the amount charged into the loan balance. This can leave buyers in an immediate negative equity position - not at all desirable!
2 - Cyclical markets
It may not feel it at times, but ultimately markets are cyclical. Over in Britain, we heard people over the last six years saying that an entire generation of younger buyers were in the process of being locked out of home ownership...and yet today an astonishing 44% of mortgage activity is for first home buyers. To all intents and purposes, this is as high a reading as we've ever seen.
Investors tend to be less in favour of buying into rising markets, while first timers are probably more inclined to buy into the market as it rises for fear of missing out. This is exactly what is happening in Britain in 2014, where first home buyers are now jumping aboard after prices increased by close to 9% in 2013.
As counter-cyclical investors, we were largely buying between 2010 and 2012 when sentiment was extremely despondent, and while it's not possible to consistently, median prices will race on to new highs in 2014.
There is, of course, ultimately a speed limit on asset prices. Property markets can't continue to appreciate in perpetuity beyond the capability of buyers to finance acquisitions. Therefore while it may take time for markets like London, Melbourne Sydney to come back to some kind of normality, over the medium term markets are likely to be to a certain extent self-correcting.
Article continues on next page. Please click below.
 
 
<hr class="system-pagebreak">
 
3 - Incomplete records
As I note below, the non-recording of first home buyers in states such as New South Wales, has been discussed for more than a year in various chat fora.
Having spent the Pommie summer (or at least, the short period of time which passes as an excuse for summer over there) in our London office, I've been a little out of the loop, but over the past six months I've now had dealings with a few first home buyers in Sydney. Clearly, with offices in Mayfair and Martin Place, our target clients are higher-income earners and investment funds. Nevertheless, I have had some FHB interaction.
Last month, I engaged with a first home buying couple and enquired out of interest whether they had registered as such when obtaining finance. Their response was along the lines of: "No, why would we do that?" Which pretty much sums up the current situation.
Before Christmas I worked with another first time buyer who had chosen to buy an investment property as their first move onto the housing ladder, and as such they weren't recorded as a first-time buyer either. Buying a rental property first also appears likely to be an increasing trend, as younger generations change jobs and careers far more quickly than has ever been the case before.
Now granted, the sum total of my experiences in NSW with first home buyers over the last half year – at only four – is not nearly enough to conclude anything with statistical significance. But given that in all four cases the data has not recorded the buyers as FHBs, it's enough for me to conclude that the system ain't working.
To be frank, I'm not even sure how this issue gets resolved, short of a directive to mortgage brokers from a regulatory body or other changes to the existing system? Answers on a postcard. However, for now, I can't see how a reading of above 24% in Western Australia and 3.4% in New South Wales makes any kind of sense to anyone who is analysing the data objectively.
Some observations of the first home buyer experience
One observation I have to add from my dealings with first homebuyers over the last six months is that today the real estate market dice are fully loaded in favour of dual income households.
Saving a 5% deposit seems to be an achievable enough task for a couple; whereby one of the incomes can be used to pay for rent, food, living costs and luxuries, and the second income can be socked away for a deposit. Clearly, this is not nearly as easy a prospect for a single income earner, particularly in the younger and lower income-earning years.
Another factor which has distorted the savings process in recent times has been a necessarily increased dependence on debt to fund higher education, leading potential first home buyers towards mixed priorities. Should one clear the tranche of liabilities related to education costs before embarking on the next level of indebtedness?
Home ownership rates have been remarkably stable in Australia for the past half century. However, it strikes me as very likely that our comparatively high rates of home ownership will begin to decline to levels seen in other developed countries, as Australia's population explosion continues and as people do practically everything later in life than they used to.
However, absent significant changes to the prevailing system (e.g. a major tax reform which makes ownership less appealing than renting) most Australians will likely continue to aspire to get onto the housing ladder one day. For that reason it seems probable that the market will remain robust in most well-located capital city suburbs over the longer term.
<img width="450" height="310" src="https://1.bp.blogspot.com/-MIPWGt0ZfX4/UvgH28WAEdI/AAAAAAAALdg/OakFaZkBNG8/s1600/HORates.jpg" style="border: 1px solid #ebebeb; position: relative; padding: 5px; box-shadow: rgba(0, 0, 0, 0.0980392) 1px 1px 5px;">
Pete Wargent is the co-founder of <a rel="nofollow" target="_blank" href="https://allenwargent.com/">AllenWargent</a> property buyers (London, Sydney) and a best-selling author and <a rel="nofollow" target="_blank" href="https://petewargent.blogspot.com/">blogger</a>.
His new book '<a rel="nofollow" target="_blank" href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx">Four Green Houses and a Red Hotel</a>' is out now.
 
 
 
</body></html>

pwargent-M4siyDbqQY

The three reasons why first home buyer numbers will be strong enough in 2014

<html><body>
Astute investors know that all properties have defects which if not identified during due diligence, can be money pits. There is a small window of opportunity during the brief due diligence period to identify these risks prior to purchase.
Identification of risks provides a bargaining opportunity to either negotiate a reduced price or request the risks be removed at the vendors cost. Risk avoidance can be achieved with meticulous due diligence, particularly in investigation of eight potential deal killers listed below.
1. Asbestos contamination risk?
Asbestos materials of various types were commonly used in Australian property construction between 1940 and 1990. Asbestos materials were embedded in wall cladding, roofs, gutters, drain pipes, vinyl flooring, electrical wiring thermal insulation, boilers, exhaust pipes, switchboards, thermal insulation and inside fire doors.
The new National Work Health and Safety Act of 2011 requires owners of buildings constructed before 2003 to conduct an asbestos survey. Where asbestos materials are identified, this triggers the mandatory requirement for an asbestos register and asbestos management plan (AMP). Some property owners appear to be unaware of this new obligation.
An asbestos register is necessary to track of asbestos materials remaining (or removed) in investment properties. Asbestos may also be located in inaccessible areas and unfortunately discovered during re-development with sometimes disastrous and costly results. Asbestos materials if disturbed can cross contaminate internal areas of the buildings, requiring evacuation, loss of rent and potential occupant litigation.
Asbestos removal is a legally notifiable project, which can result in extremely costly asbestos removal projects. Careful investigation during due diligence can forewarn investors, revealing the true cost of asbestos removal. Armed with detailed information and cost options, investors can then more accurately evaluate if they wish to proceed with the purchase or avoid the risk.
2. Electrical switchboard over-loading and fusion risk?
Building electrical cables and switchboards can become over-loaded with tenancy changes and added electrical equipment. The overloading of wiring inside electrical switchboards can remain undetected for many years. Electrical fusion is one of the primary causes of fires within buildings where overheating of electrical switchboards and wiring starts fires.
Further electrical risks can include lack of earth leakage protection (ELP) to reduce the risk of electrocution to occupants. Poor quality electrical installation and modifications over time, can overload electrical switchboards leading to potential fires or equipment failures.
A review of electrical maintenance should be included in due diligence investigations to identify weaknesses and potential costly failures.  Where electrical maintenance is inadequate this may void insurance cover, with owners exposed to remediation costs.
Article continues on next page. Please click below.
 
<hr class="system-pagebreak">
3. Fire and life safety non-compliance risk?
Fire and life safety systems for buildings require continuous testing and mandatory certification to confirm the fire detection and protection equipment will function to design when there is a fire.
Where buildings are refurbished this may trigger a mandatory requirement to upgrade the entire fire protection systems to the current Building Code of Australia (BCA) fire standards (This mandatory trigger activates when 50% of the building is refurbished within a three year period).  Upgrading can require new fire sprinklers, fire stair pressurisation, new fire hydrants in fire stairs, smoke hazard management, and in extreme cases additional fire exit stairs.
Upgrading of fire protection systems can incur considerable cost and potential risk and cost of compliance should be calculated before settlement.  Due diligence investigation should include a review of lease expiry dates and tenancy refurbishment timelines, to avoid trigging the 50% over three year rule.
4. Environmental site soil contamination?
Site contamination can occur from past site use, for example, contaminated industries such as petrol stations, industrial storage, chemical processing industries, dry cleaners, processing industries. Underground storage tanks (UST) even if removed, can leave toxic contaminants in sub-soils to contaminate the land and surrounding sub-terrain water courses. This may contaminate neighbouring properties, with the potential for future litigation.
Testing and soil removal can be a considerable expense particularly where the site is close to public waterways and the risk of cross contamination is high. The potential for sub-soil contamination is a risk often overlooked by property investors and an issue that should be investigated during the due diligence phase.
Article continues on next page. Please click below.
 
<hr class="system-pagebreak">
5. Structure and façade water proofing risks?
Structural problems can include subsidence of foundations, cracking of walls, concrete cancer, leaking roofs, leaking windows or facades, flooding risk, or low earthquake resistance structures.
Where structural defects are identified, costs for repairs need to be estimated and negotiated with vendors prior to settlement. Unforseen property defects can result in major capital cost to correct structural weakness. Building changes and additions to original structure may overload design foundations with movement and consequential structural cracking. Façade deterioration can result in water entry and major internal damage.
In locations close to flood prone areas, underground basements and car parks may be flooded by back-flow of water through stormwater drains or sewers mains (i.e. Brisbane floods). Property constructed close to rivers beaches and harbours may also be impacted by salt migration and increased risk of rust and concrete cancer of steel reinforcing. Structural issues should form part of the due diligence investigation.
6. Disabled access non-compliance risk?
The 1992 Disability Discrimination Act (Commonwealth) has provided a standard that requires all buildings to provide dignified access with special facilities for people with disabilities (PWD). This has been codified in Australian Standards AS1428.1 as a requirement in new construction under the Building Code of Australia.
Where older buildings are refurbished, a mandatory requirement mat be triggered to upgrade the disabled access features to current Australian Standard AS1428.1. This can result where 50% of the building is refurbished within a three year period. Major capital expenditure could be necessary to provide new entry ramps, wide disabled parking bays, upgrading of lift controls, tactile ground surface indicators (TGSI) and large unisex disabled toilets, on each occupied floor in excess of 500 square metres.
Potential risk and cost to upgrade the investment property to fully comply with disabled access standards AS14281 may be overlooked during property acquisition. The requirement to provide disabled access and facilities can also be triggered with local government building approvals for tenancy fit-out where floors areas exceed 500 square metres.
Article continues on next page. Please click below.
 
<hr class="system-pagebreak">
7. Air conditioning life cycle failure risk?
Air conditioning is not a luxury but an essential business component for tenants in modern buildings. Air conditioning systems are not like red wine and improve with vintage, but conversely deteriorate over time. Air conditioning plant and equipment have finite service lives with cooling and heating capacities slowly deteriorating over time. Original design cooling and heating capacities may be under-sized or mismatched to current occupancy loads. Additional air conditioning equipment may be required to meet comfort conditions specified in tenancy leases.
Due diligence should include condition and remaining service life of the air conditioning equipment. Replacement of air conditioning systems can require considerable capital expenditure that should always be estimated during due diligence. Replacement costs for air conditioning over a 10 year investment timeframe can result in large negative cash flow that needs to be included in calculation of internal rate of return (IRR) and return on investment (ROI).
8. Lack of mandatory certification to building codes?
In some cases where mandatory requirements for development approval, building approval or Occupancy Certification are incomplete this can lead to serious future consequences, including potential litigation from statutory bodies, potential restricted use by fire authorities and major difficulty in future when selling the property and non-compliance issues revealed.
Where non-compliance issues are unrevealed at settlement the obligation to remedy these issues becomes the responsibility of the purchaser. Non-compliance can include incomplete development approval conditions, incomplete Building Code of Australia BCA certification, Incomplete Occupancy Certification or lack of Annual Fire Safety Certification.
Where comprehensive technical due diligence is completed, these non-compliance risks can be revealed, and investors have the ability to either avoid the contract, or request a reduction in contract sum to compensate for rectification.
A further option is to request the vendor rectify the non-compliance risk and hold in escrow an agreed sum equivalent to the cost for the purchaser to rectify the risk. Where the vendor is unable to rectify the risk, the sum in escrow is able to be utilised by the investor to remedy the risks.
Comprehensive due diligence allows prospective investors to gather factual information about the condition, remaining service life, statutory non-compliance or other major property risks. The investor can then make a fully informed decision to either accept or avoid a contract on an investment property.
Clive Burrows is the founder of <a target="_blank" href="https://www.risk8.com">Risk Management Group</a>, an Australian due diligence consultancy that has undertaken in excess of 200 due diligence investigations on $11.9 billion of commercial real estate transactions over the past 20 years. 
You can contact Clive via <a target="_blank" href="mailto:Clive@Risk8.Com">email</a>.
 
 
</body></html>

Latest Expert Insights

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

Guides

Editor's Picks

Guides

Developments

New apartments

New townhouses

News

Latest Expert Insights

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

Guides

Editor's Picks

Receive the latest news stories to your inbox

Guides

Developments

New apartments

New townhouses

News