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

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

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

How Sterling Global designed 623 Collins from Melbourne's history

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

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

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

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

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

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

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

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

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

Every First Home Owner Grant for new property by state

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

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

Staff Writer

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

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

alisonwarters@gmail.com

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

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

Ellen Walker

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

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

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

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Supply is the factor most over-looked by property investors.
Those who take the time to do some research before tossing a few hundred thousand at an investment property tend to focus on demand, with scant regard for the flipside of the growth equation.
Some organisations that purport to advise investors preach a simplistic follow-the-population-growth strategy.
If high population growth was the core element in a good locational choice, the leading capital growth performers in the past five years would have been the Gold Coast and Wyndham City in the south-west of Melbourne. Gladstone, boosted by massive new demand from the influx of tens of thousands of gas project employees, would have soaring prices right now.
The opposite is true in those markets. The too-often forgotten factor is supply.
The Gold Coast has had five years of falling property values because of too much supply, which overpowered the impact of high population growth. Wyndham City, which overtook the Gold Coast as the municipality with the greatest annual additions to its population, has recorded no growth in prices in the past three years, because of an excess of house-and-land packages – ultimately flogged off to distant investors by dodgy marketing companies on behalf of desperate developers.
Gladstone, after recording high growth in rentals and prices in 2011 and 2012, has seen rising vacancies and sharp downturn in prices because developers went overboard yet again.
So there are two key pieces of information investors must examine before committing to a target location: vacancy rates and building approvals.
The rapidly-growing location of Gracemere is a good case study. Gracemere is about 10 kilometres west of Rockhampton, one of our favoured regional centres because of its growth factors and affordability. The population of Gracemere was around 5,000 at the 2006 Census and 8,400 five years later.
Earlier this year senior Hotspotting writer Bob Wilson visited Gracemere as part of a research safari through Queensland and the Northern Territory. He commented about Gracemere: “What was once a sleepy country town surrounded by grazing paddocks has become a development free-for-all as investors buy up those paddocks and built houses on them.”
The problem is that they’ve built too many. Way too many. One of our clients phoned last week to tell us: “Gracemere has just been smashed by developers. There’s a massive oversupply.”
He said there were hundreds of empty rental properties and rents have dropped sharply. A quick check with SQM Research shows that the vacancy rate in the Gracemere postcode has risen from around 2% late last year to 9% now. Australian Property Monitors data shows that median price growth has stalled recently and is starting to go into reverse.
In a recent update of our research on Rockhampton, we noted that residential building approvals in the Rockhampton Regional Council, which includes Gracemere, in the 2012-13 financial year were almost double the year before.
Some would see that as an attraction, being indicative of a growth centre. I saw it as a warning signal, that developers might be making the same mistake they made in Mackay and Gladstone, generating over-supply.
Gracemere is increasingly an outlying suburb of Rockhampton so its over-supply issues are likely to impact the wider region. Investors would be wise to keep on eye on vacancies there.
<hr>
Terry Ryder is the founder of <a href="https://www.hotspotting.com.au/" target="_blank" rel="nofollow" style="font-size: 14px;">hotspotting.com.au</a> and you can contact him via <a href="https://mailto:%20ryder@hotspotting.com.au" target="_blank">email</a> or on <a href="https://www.twitter.com/hotspotting" target="_blank" style="font-size: 14px;">Twitter</a>.
 
 
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terryryder-YECXbqmri2

The most overlooked factor of property investing: Supply

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Changes to the MyRate Pty Ltd (My Rate) website (myrate.com.au) have been made following ASIC concerns that the home loan interest rates advertised had the potential to likely mislead consumers.
The non-bank lender's website was said to give the impression that the advertised rate for variable home loans applied to both existing and new loans. In fact, it only applied to new home loans, meaning those with existing variable rates were charged interest above the advertised rate.
<img alt="rate-city-dec-9-two-from-july-1-2012" src="/images/stories/2013/12/09/rate-city-dec-9-two-from-july-1-2012.jpg" height="367" width="470">
Photo: Screenshot of the MyRate website from July 1, 2012. Source: The Wayback Machine
MyRate has since made prominent changes to its website to state the rate only applies to new loans, as well as have agreed to write to all affected customers to confirm this fact.
ASIC deputy chairman Peter Kell said that the expectation from credit licensees is that clear and accurate information is provided in advertising.
<img alt="rate-city-dec-9-one" src="/images/stories/2013/12/09/rate-city-dec-9-one.jpg" height="373" width="470">
Photo: The MyRate website as of December 9, 2013
This comes after <a href="https://www.propertyobserver.com.au/finance/asic-penalises-mortgage-choice-for-claims-of-saving-customers-%2410k-over-five-years/2013112766653" target="_blank">Mortgage Choice recently paid a penalty</a> for potentially misleading advertising, and appears to fit with Kell's warning at the time that "ASIC will continue to act in instances where advertisements contain representations about a product that are false or misleading".
"Where advertising promotes a particular product feature, such as a low interest rate for a loan, the credit provider needs to make sure that any qualifications about how that rate applies are clear and that the information is not misleading in any way," said Kell.
ASIC refers to their <a href="https://www.asic.gov.au/asic/asic.nsf/byheadline/Regulatory+Guide+234+Advertising+financial+products+and+services+%28including+credit%29%3A+Good+practice+guidance?openDocument" target="_blank">guide around advertising financial products and services</a> here, for those concerned.
The loans on MyRate are funded by ING Bank (Australia) Limited.
Customers who think they may have been misled are encouraged to contact: enquiries@myrate.com.au, 1300 663 558 or Suite 901, 447 Kent Street, Sydney, NSW 2000.
In 2006, MyRate, as well as One Direct, revised their advertising for variable home loan rates after ASIC raised concerns over misleading promotional material. This was after their low, variable home loan rate did not reflect a Reserve Bank interest rate increase in August.
ASIC enquiries discovered that both lenders decided to postpone a decision over whether to pass on the increase until 2007. ASIC noted that they were concerned the promotional material did not make it clear that at a later stage the rate may be increased to reflect the RBA's movement, that customers would not expect a variable rate to be affected by official interest rates announced some time before they signed up and that the advertised rate was used as the basis for a comparison with another rate that could be inconsistent in the long-term.
One Direct and MyRate altered their advertising to reflect a potential future increase, with ASIC executive director, consumer protection, Greg Tanzer, noting in 2006 that he welcomed the constructive response received.
"Consumers are likely to respond positively to low home loan interest rates," said Tanzer.
"If those rates are subject to changes or conditions that are unusual or unexpected it is vitally important that they be prominently disclosed and explained," he said.
Since 2006 a number of new guidelines have been brought out by ASIC regarding advertising for this industry.
MyRate currently has an <a href="https://www.myrate.com.au/education/avoid_being_misled" target="_blank">'Avoid Being Misled' guide available</a> on their website, warning about: Exaggerated claims of independence Exaggerated guarantees Out of date interest rates Deceptive enquiry forms Non-existent lenders Advertising of bait and switch products Editorial for paid finance products masquerading as "top" or "featured" listings
It notes the following: "Although it is illegal to advertise an incorrect rate, some lenders may not notify the comparison site. For instance, if all the lender rates go up, by not notifying comparison websites a lender could propel themselves to the top of the tables based on rate."
 
<a target="_blank" href="mailto:jduke@propertyobserver.com.au">jduke@propertyobserver.com.au</a>
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jduke-EHk3XBmHkn

MyRate makes changes to advertising in response to ASIC concerns

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2013 will be remembered as the year the Sydney property market came back to life. After three tough years where prices went backwards, buyers were suddenly the ones on the back foot as a number of factors combined to create fierce buyer competition. The competition was most noticeable on inner city houses under $1.5 million and apartments under $700,000.
There are a number of factors that could be credited for causing such a stellar year in the property market. In reality, it was probably not one particular factor that caused the market rally, rather a number of factors combining to cause a perfect selling environment.
Interest rates hit an all time low during 2013 as the RBA cut the cash rate to 2.5% in August. This cycle of rate cuts has seen the cash rate go from 4.75% in November 2010 down to 2.5% within three years. Whilst there were other factors that assisted the housing market in 2013, nothing had the positive impact on property as the record low rates did. Commentary is split as to whether the next move in 2014 will be up or down though.
Unemployment held at reasonable levels throughout the year, peaking at 5.7%. This was lower than predicted and was a determining factor in supporting the property market. Low interest rates are not much good to someone whom is unemployed. Indeed, the weakest housing market in Australia is in Tasmania where unemployment is stuck above 8%. This proves that unemployment is a bigger determinant to the fortunes of the housing market than interest rates, a point that is often lost in commentary.
Self-managed super funds entered the market in dynamic fashion in 2013. As the returns on bank deposits went down, SMSFs went looking for risk. Many people have bought real estate now that their SMSFs can borrow against an asset. This added an influx of new buyers into the market competing with home buyers and traditional investors. More buyers entering the inner city market that already faces chronic supply issues helped pushed prices up. As prices went up, the sentiment toward property became more positive, creating a positive feedback loop.
Chinese buyers entered the Sydney market place in a big way in 2013. To see another sector of buyers enter the marketplace that was already experiencing near perfect conditions added further fuel to the market. Agents across Sydney reported amazing sale prices where Chinese buyers fixated on a particular location and just kept bidding the price up. The emergence of Chinese buyers entering the market place was no media beat up. One only had to witness an open house or two to realise the presence of strong Chinese buying.
The stock market’s performance is often under rated when it comes to the property market. The All Ordinaries begun the year at 4,664 and pushed up to over 5,200 by December 2013. In the middle of 2012, the All Ords was at 4,135, giving stock market investors a 30% return in 18 months. Whilst interest rates inspire many in the sub $1.5 million bracket to buy real estate, the prestige end of the market is more susceptible to the stock market performance. For the first time since 2007, the prestige end of the market came to life. Whilst many vendors of prestige properties actually sold for less than they had bought back in 2007, the mere fact that transactions were taking place was a positive sign.
Many were surprised to see the property market perform so well in 2013 in the face of a deteriorating economy, global uncertainty and increasing government debt. But perform well it did.
 
<hr>
 Peter O'Malley is sales consultant with <a target="_blank" href="https://www.harrispartners.com.au/" rel="nofollow">Harris Partners Real Estate Agents</a> and has been successfully selling real estate in Sydney's Inner West since 2000.
He is also the author of Real Estate Uncovered: A probing look behind the facade of Australia’s property world.
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pomalley-BdcQDjSqwv

It was a very good year: 2013 in review

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Class action lawsuits against eight banks over ‘unfair fees’ has Finder.com.au saying this will be a ‘game changer’ for the industry.
Citing fees between $20 and $45 for overdraft and over the limit charges, spokesperson for Finder.com.au, Michelle Hutchison, said that the class action lawsuits show the power of public pressure, with a potential shake-up of bank fees across the entire industry if the cases do win.
“In fact, last year, we collectively paid our banks over $11 billion in bank fees – over $4 billion of which was from households,” said Hutchison.
However, she said that it’s worth considering voting with your own wallet and switching yourself.
Observer C<a target="_blank" href="https://www.propertyobserver.com.au/economy/busting-big-bank-secrets-insights-on-avoiding-bank-fee-traps-christopher-joye/2011110752245">hristopher Joye recently wrote about how to avoid bank fee traps</a>, and went into the reasons some of these fees crop up.
“But we can’t rely on financial institutions to charge fair fees or drop their fees altogether. The only way we will make real changes to the banking industry is if more Australians compared their financial products and switched. This will force institutions to be more competitive.”
Statistics from their site note that there are 105 home loans with no annual service fees, and 101 home loans where redraw fees are not charged.
“It’s up to more Australians to take on the responsibility with their financial products by reviewing their options and comparing deals,” she said.
“It will not only force competition between banks but also will save consumers potentially thousands of dollars every year.”
The proceedings in the Federal Court of Australia were initially issued against the ANZ bank in September 2010, over repayment of fees they have charged their customers over the past six years. These were issued by Maurice Blackburn Lawyers. The fees including honour and dishonour fees on bank accounts, over limit fees and late payment fees on credit cards.
Proceedings were then issued against Citibank, Commonwealth Bank, NAB and Westpac (16 December 2011), St George and BankSA (1 February 2012) and BankWest (18 April 2012) with more than 170,000 Australians who were charged these fees signing up online to be part of the case, with the claim size estimated at more than $220 million.
The case went to trial this month and is scheduled to run for three weeks, Maurice Blackburn Lawyers notes.
Maurie Blackburn will claim that the bank charged exorbitant fees (those being the $20 to $45) for services that cost minimal amounts (a few cents or dollars) to provide. Fees are able to be considered a penalty charged by the bank rather than a fee for service.
In other words, we will claim that the bank charged exorbitant fees of between $20-$45 for a service that cost them only a matter or cents or a few dollars at the most to administer.
 <a target="_blank" href="mailto:jduke@propertyobserver.com.au">jduke@propertyobserver.com.au</a>
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Class action cases over bank fees to be a “game changer”

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The latest affordability index by the Adelaide Bank and Real Estate Institute of Australia has once again flooded the real estate headlines with the jolly news that housing is growing ever more affordable.  
This pre Christmas gift of optimism from the newly updated affordability studies commissioned by the financial and real estate sectors, comes with a host of commentary – usually from those with a vested interest – who happily advise aspiring home owners that ‘they’ve never had it so good’ – in other words, to paraphrase Terry Ryder’s thoughts, first home buyers should <a href="/news">‘put up, or shut up.’</a>  
Of course, it wouldn’t be half as palatable if it didn’t come accompanied with the seeming contradiction that not only is it more affordable than it’s been in the last decade (according to the HIA-Commonwealth Bank affordability index), it’s also substantially more expensive than its ever been. Yes, housing is only item than can be both affordable and unaffordable at the same time.  Work that one out Einstein.  
In fact, according to <a href="#more-3603" target="_blank">Residex</a>, median prices in both Sydney and Melbourne have already exceeded their historical highs, ‘nudging’ $750,000 in Sydney and $600,000 in Melbourne - additionally, Perth has also reached its previous peak of 2008, with a median price of $521,000.  
<a href="https://www.rpdata.com/" target="_blank">RP Data’s</a> dwelling price index shows a year to date increase of 14.3% in Sydney, 6.4% in Melbourne and 9.7% in Perth.  For home buyers, the benefit derived from lower lending rates has been all but offset by the inflationary pressure placed on prices.  
Rarely is it mentioned that housing affordability and the cost of servicing a mortgage are two separate entities.  
Mortgage rates are set up with different structures dependant on circumstance, and subject to interest rate changes influenced by the macro environment.  
To take out a 25 year mortgage requires the expectation of secure employment in a terrain where frequent job changes or part time work are becoming a norm.  
They may influence house prices through a cycle, but they do not take away the fact that home prices now – even with lower lending rates – require longer terms to pay down, with the interest over the duration of that period adding considerably to the capital cost.  
In fact I couldn’t put it any better than current governor of the Bank of England - <a href="https://www.theguardian.com/business/2013/nov/29/mark-carney-bank-of-england-home-buyer-warning" target="_blank">Mark Carney</a>, when he warns;  
“Think about the mortgage you are taking on, the debts you are taking on…You are taking at least a 25-year mortgage, maybe a 30-year mortgage.  Are you going to be able to service that mortgage five years from now, 10 years from now, if interest rates are higher? Or are you counting, even subconsciously, on the price of your house keeping going up and if something happens an ability to sell it quickly and not facing the consequences of not being able to pay?"
Carney’s cautionary words pre-empt the Bank of England’s decision to scale back its inflationary Funding for Lending Scheme amidst fears of a rapid escalation of house prices in the south-eastern regions of the country.  
From next year funding for lending will only be available for business loans -not mortgages – and if the banking sector’s concerned about signs of frothiness in an industry in which it’s heavily invested, so should we also be.  
The Bank of England governor is not alone. Central banks in Sweden, Hong Kong, Norway, New Zealand, Canada and Switzerland (to name but a few) have all adopted macro prudential measures to buffer against the associated risks of a boom/bust investor lead recovery in a post GFC environment - highlighting the importance of keeping lending standards robust – all, that is,  except Australia.  
Having weathered the impact of the GFC a little more effectively than others – the RBA seem to think we live in some magic faraway tree, effectively doing little more than wagging a cautionary finger to a sector which for the duration of the year, have outstripped owner-occupier lending with well over a third of all new loans on interest only terms and roughly the same proportion with LVRs of over 8%.  
In other words, there are still over a third of all loans in which the principle is not being reduced – with 37.3% lent on these terms for the September quarter alone.  
In NSW, investment lending is at record highs, making up over 50% of the market and although many use the well worn argument that the unwanted boom is predominant ‘only in Sydney’ – let’s not forget, Sydney is not some nether land off the coast of Tasmania. What happens in our biggest capital, with the largest and most diverse economy in Australia, inevitably impacts us all.  
Historically, this sector is more sensitive to interest rate changes with a tendency to wax and wain pro cyclically with market movements, exaggerating both gains and falls.  A housing recovery built on the back of small mum and dad investors pouring their money predominantly into negatively geared established dwellings – especially considering our current levels of private debt to income ratios - is not ideal for the long term the stability of our housing market, or house prices.  
The common Aussie term ‘spruiking’ - which APRA warns against in the self-managed super sector, is not only a contributing aspect of what inspires our culture to see property as the undiversified road map for building wealth for retirement – it is also part and parcel of what has kept our property prices high by both local and international standards.  Yet the risks associated with spruiking in SMSFs is simply the tip of a much larger iceberg.  
Having worked in many aspects of the housing industry, I have seen first hand the type of material that’s presented at seminars not just from those who receive under the table commissions from developers, but also from advocates working as independent advisors for either the seller or buyer.  
It really isn’t unusual to see slides presented at seminars with straight lines charting the difference between investing in properties that supposedly “grow” at steady 5% per annum, compared to those that grow at 10%, using historical median data as ‘evidence’ that future returns can replicate those achieved in the past, without any distinction of how such data is correlated or the difference between individual “house prices” and “median values.”  
This information borders on financial advice and comes with no mention of risk or the type of rigorous analysis, which you would reasonably expect when choosing to invest in a single asset.  
Another widely used industry favourite is the statement;  
“FACT: fewer than 5% of properties are investment grade”  
A myth if ever there was one.  Perhaps the well-known companies that use this as an advertising tool, would like to point to the person who researched every property in Australia to correlate such a statistic? Maybe we could also ask for a comprehensive definition of what ‘investment grade’ really is – because I guarantee there would be no shortage of differing opinions from industry ‘experts.’  
This endless promotion of residential property, with rows of investment magazines lining newsagency shelves, promoting subjective ‘hotspots,’ or as I <a href="https://catherinecashmore.wordpress.com/2013/11/18/do-we-have-a-changing-landscape-concerning-australian-real-estate-and-property-prices/" target="_blank">pointed out</a> a few weeks ago, agencies cold calling households, and sending ‘advisors’ round to ‘educate’ and encourage inexperienced investors to negatively gear against their principle place of residence, is toxic.  
Article continues on next page. Please click below.
 
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Meanwhile, the RBA continue to sit on their hands, not wanting to pull a regulatory lever, instead <a href="https://www.afr.com/rw/2009-2014/AFR/2013/09/25/Photos/160229d4-2585-11e3-bbca-a7ec88bfff7c_FSR.pdf" target="_blank">warning</a> investors to employ caution, hoping they will fall into line like a bunch of good school kids. However, whilst macro prudential tools may assist in ensuring banking lending standards remain robust – can they have any long-term sustainable or lasting impact on property prices?  
In a recent research paper by BIS (Bank for International Settlements), entitled <a href="https://www.bis.org/publ/work433.pdf" target="_blank">“Can non-interest rate policies stabilise housing markets?”</a>, evidence was gathered from 57 countries spanning more than three decades, investigating the effectiveness of nine non-interest rate policy and macro prudential tools on restraining credit growth and house prices.  
The analysis used a new dataset going as far back as 1980, making it the most comprehensive study to date in terms of both scope and time span.  
The paper concluded that whilst reductions in the maximum LTV (loan to value) ratio can restrain demand, its effects can be partially or wholly offset by a rising market enabling the investor to borrow more, therefore, changes in the maximum DSTI (debt service to income) ratio were assessed to be more substantial.  
But importantly;  
“Only tax changes affecting the cost of buying a house, which bear directly on the user cost, have any measurable effect on prices” and,  
“None of the policies designed to affect either the supply of or the demand for credit has a discernible impact on house prices.”
The study puts this down to the ‘can buys’ still outnumbering the growing pool of credit constrained ‘can’t buys’ – stressing that the importance of housing supply was not explicitly considered. Therefore if we want to lower house prices or put in place policies to aid affordability, we need to look outside the limited powers of the RBA alone.  
As has been proven <a href="https://www.businessspectator.com.au/article/2013/1/21/national-affairs/built-backs-first-home-buyers" target="_blank">time and time again</a>, intermittently stoking at the bottom end of the market with FHB grants and incentives does little more than provide a short term happy pill for vendors, as the price multiplier effect ripples across the rest of the housing terrain, stimulating both an inflationary and volatile environment.  
Instead, we need to focus on the real problem in Australia – and it’s not property prices, it’s land prices - as economist <a href="https://www.macrobusiness.com.au/2013/11/residential-land-values-reflate-across-australia/" target="_blank">Leith Van Onselen effectively points out</a> when he analyses the difference between commercial and rural land compared to residential land values, and building costs.  
“Whilst commercial and rural prices have remained relatively stable over the last 24 years relative to GDP, residential prices have skyrocketed.”  
In other words, the cost of residential fringe land, which without constraint, should be close to its ‘raw’ value, is not cheap at all – and it’s all down to ineffective urban planning policy.  
As I (<a href="https://www.macrobusiness.com.au/2012/12/englobo-the-shady-world-of-land-banking/" target="_blank">and others</a>) have pointed out previously, even within a wide expansive boundary as mooted in Melbourne’s new urban growth strategy, the government limits land use until they have gone through a lengthy process of mapping out areas for infrastructure known as a ‘<a href="https://www.gaa.vic.gov.au/precinct-structure-plans/" target="_blank">Precinct Structure Plan’</a> (PSP) – it is a slow laborious process and as soon as you restrict the supply of anything, scarcity inevitably inflates values.  
Larger developers are not slow to purchase swathes of acreage prior to rezoning, and then once PSPs have been finalised, drip feed it onto the market. Not only do government bodies have little understanding of how released plots respond to consumer demand, they have no policy in place to deter the practice. It’s therefore a failure.  
Furthermore, facilitation of infrastructure is currently financed via hefty development overlays, which are passed onto the buyer rather than initiatives such as bond financing, where residents pay back proportionally over a lengthy period of time, as was the case historically.  
We must remove these barriers with effective policy and let land prices revert back to normal levels to reflect a real price closer to commercial values.  
Without doing so, we can’t gain a true indicator of the trade-off buyers are prepared to make between price and distance. Currently, the average price of a newly built house and land package is around $400,000, this is not serviceable on the single median wage, and therefore can hardly be deemed affordable.  
Get the land supply, price, and infrastructure equation right and I suspect there would be no lack of demand from genuine aspiring home buyers.  Only when this is done, can we have a truly transparent debate on first home buyers’ willingness to spread over the land.  
 
<hr>
 Catherine Cashmore is a market analyst with extensive experience in all aspects relating to property acquisition.
 
 
 
 
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Can housing really be affordable and unaffordable at the same time?

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You may have caught wind that there will be an inquiry into the financial system early in the New Year. Whilst this news is probably snooze inducing for the most people, there are plenty of reasons why you should pay attention.
The financial system takes our deposits and lends us money for a home or a small business.  It can help determine whether we get wealthier or poorer – and it can affect whether we can afford to fulfill lifelong dreams of buying property or retiring with some comfort.
The inquiry will address some key problems with the system and Australians have a once in a decade opportunity to get involved. Here are some of my thoughts so far to make the system fairer and better for the hardworking people that it is meant to serve.
First, we need to see transparency in interest rate advertising required in legislation to protect Australians from ‘too good to be true’ deals. People need to have the ability to make informed decisions and compare apples with apples. After all, a mortgage is probably the biggest debt you’ll ever take on. You want to make sure you’re getting the fair deal on it.
Second, the two Australian dreams – a home and a comfortable retirement – are becoming unachievable for so many people. We’re taking on larger mortgages, later in life, and for longer. But given we know that one of the best indications of security in retirement is owning your own home, the system needs to take better account of that as well as the current focus on retirement income streams. It’s not one or the other – it’s both.
Thirdly, every Australian should have the ability to master his or her own finances. If you’re one of the few that can, either you were lucky enough to have parents that taught you these skills, or you have sought out professional financial advice. We need reform of our systems to make financial education a priority for all people, and from a young age.
My fourth point is that there needs to be more competition in the lending market. Smaller players can provide tailored, competitive and secure services and keep the system competitive and consumer-focused. In the past, government and the regulators have favoured the bigger ‘too big to fail’ players at the expense of their competitors. Yet size does not equal safety in financial systems – the GFC proved that – and as any economist will tell you, when there isn’t enough competition, Australians end up paying more.
Finally, our system is not geared for women, young people, small business owners, or for people that have irregular, interrupted income due to family, consultancy work or other situations that fall outside the nine to five norm. Accumulating an income to retire on seems like a fantasy in these cases and that’s why reform of superannuation contribution rules is necessary.
They are five simple points that I think will give us a fairer, stronger and more competitive financial system.
If you have some ideas, I’d love to hear from you.

<hr>
Mark Bouris is executive chairman of <a target="_blank" rel="nofollow" href="https://www.ybr.com.au/">Yellow Brick Road</a>, a financial services company offering home loans, financial planning, accounting and tax, and insurance.
You can contact Mark on <a rel="nofollow" href="https://twitter.com/markbouris" target="_blank">Twitter</a>.
 
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Speak up now: Creating a fairer financial system

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Australian banks are much more heavily exposed to mortgage lending than banks in most parts of the world, which is why the latest publication of <a target="_blank" href="https://www.apra.gov.au/statistics/Pages/default.aspx">APRA data</a> on home lending has set the hares running.
The data showed 14% of the recent mortgage lending by banks has been for loans which exceed 90% of the relevant property valuation.
The IMF has also been in Australia on its annual review and <a target="_blank" href="https://www.propertyobserver.com.au/https://www.abc.net.au/news/2013-11-21/imf-issues-property-warning/5107090">commented</a> on the risk to the banking sector from its exposure to mortgages. It often does.
This is a well-worn theme. The IMF’s last <a target="_blank" href="https://www.imf.org/external/pubs/ft/scr/2012/cr12305.pdf">review</a> (p7) expressed the risk in these terms:
“Domestically, despite a recovery in the household savings rate and a recent softening of house prices, high household debt coupled with elevated house prices remains a vulnerability”.
It is an important issue, particularly in Australia. Kevin Davis has <a target="_blank" href="https://www.rba.gov.au/publications/confs/2011/pdf/davis.pdf">pointed out</a> the unusually high levels of exposure of Australian banks to residential real estate. He suggested that some 59% of the total loans of Australian banks in 2009 were for this purpose compared with the US 38%, Canada 32%, Germany 17% and the UK 15%.
In essence there are two areas of major risk in the Australian financial system.
Australian banks are heavily exposed to domestic mortgages and they are still very reliant on borrowing from foreign wholesale markets to fund their lending.
The banks have worked hard to manage the funding risk in recent years by increasing their use of local deposits and to ensure that their offshore borrowing is more long term and hence more stable. We can worry less on that score than we did once.
Bank lending for mortgages also looks quite stable. Most borrowers have a lot of equity in their houses so that even a big price fall would not mean their loans were worth more than their houses, and most have made extra payments so they have a buffer against unemployment.
Less than 2% of loans are low-doc, potentially the highest risk category. The local banks also normally require borrowers take out insurance when they are borrowing more than 90% of the value of the loan.
We can see the impact of these factors in NAB’s recent results. The bank’s average mortgage borrower is eight months ahead of the required payments, and two-thirds of customers are at least one month ahead, the average loan to valuation ratio on its books is 48%, and some 15% of the book is insured. The consequence is that the bank’s loss rate on mortgage lending is 0.04%. Clearly there are still risks, for example if a mortgage insurer were to collapse, but it looks quite safe.
Nevertheless most analysts, investors and parties which lend wholesale funds to the Australian banks, pay close attention to their housing exposures.
Particularly in an environment where credit growth is quite slow, one way in which banks can increase their returns is to take on more risk. Hence the interest in the APRA data published this week. Are the banks moving up the risk curve?
Even there it is not clear that there are particular concerns (see chart below). The recent proportion of loans at high LVRs shows no clear trend over the last two years. Looking back earlier we see similar numbers for the period in the mid-2000s.<img width="470" style="font-size: 0.8em;" src="https://c479107.ssl.cf2.rackcdn.com/files/36781/width668/sb5j4qpk-1386046684.jpg">
Percentage of loans above 90% of property valuation (High LVRs). Source: APRA
Just eyeballing the data suggests that APRA might well have had some conversations with the banks requesting them to keep the proportion of high LVR loans in their portfolios to below 15%.
 
<hr>
 Rodney Maddock is Vice Chancellor's fellow at <a target="_blank" href="https://www.vu.edu.au">Victoria University</a> and adjunct professor of economics at <a href="https://www.monash.edu.au" target="_blank" rel="nofollow">Monash University</a>.
This article was originally published at <a href="https://theconversation.com">The Conversation</a>. Read the <a href="https://theconversation.com/risk-on-australian-banks-skirt-unofficial-home-lending-limits-20839">original article</a>. 
 
<img width="1" src="https://counter.theconversation.edu.au/content/20839/count.gif" height="1" alt="The Conversation">
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Over-exposed? Australian banks are taking risks by skirting unoffical home lending limits

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A director and sales manager of a <a href="https://www.smartcompany.com.au/growth/economy/33481-red-energy-bears-brunt-of-accc-crackdown-on-telemarketing---fined-for-false-claims">telemarketing</a> company that sold ink cartridges have copped $100,000 in fines for knowingly breaking Australian Consumer Law.
Tuan Nguyen, the sole director of Artorios Ink, and sales manager Thuan Nguyen have each been ordered by the Federal Court to pay a penalty of $50,000 each.
The pair admitted to acting deliberately to mislead and deceive small businesses to generate ink cartridge sales.
Artorios Ink was a telemarketing company that sold printer cartridges to businesses from 2008 to 2012. It went into voluntary liquidation in February after the ACCC began proceedings against it in September 2012.
The Federal Court found that between 2011 and 2012, the company engaged in false and misleading representations to five small businesses.
The misrepresentations included telling businesses that they had agreed to purchase printer cartridges from the company, when there had been no agreement. They also told the small businesses that they were already an approved or regular supplier of the business when in fact they were not.
Artorios Ink also told businesses they instituted proceedings in the Magistrates’ Court of Victoria against the business to obtain payment for printer cartridges, when they had not instituted any such proceedings.
The court also found that the company asserted a right to payment for unsolicited goods, by sending demands for payments for ink cartridges to businesses, which had never been purchased.
Justice Mortimer stated that the conduct involved “deceit” of businesses for financial benefit.
Justice Mortimer also inferred “there was a deliberate and calculated plan constructed to misrepresent to small businesses (through calls to unsuspecting employees or shop managers) some kind of existing supply relationship, then to take advantage of the misrepresentation to supply goods and then demand payment”.
The judge found that the most serious aspect of this was its “premeditated character”.
In addition to the fines, the Court accepted undertakings from the pair that they would not manage or be a director of a corporation for five years.
ACCC deputy chair Michael Schaper said in a statement that the court’s ruling was a lesson for people involved in misleading practices.
“These penalties send a warning to traders that dishonest business practices can result in substantial penalties being imposed against the individuals responsible,” he said.
Schaper said small business should watch out for companies targeting them with misleading claims, perhaps via inexperienced junior staff members who may not know the company’s history.
Hall &amp; Wilcox partner, competition and consumer law, Ben Hamilton told SmartCompany that the conduct of the pair was at the more “extreme” end of misleading actions he had seen.
He said the fine towards the two individuals appeared fair, and commented that when companies are fined for misleading conduct the amount can be far greater.
“The court considers a lot of factors in determining a fine … the judge appears to have been guided by the premeditated character of the offences, which influences the penalty,” he says.
Hamilton advises business owners that to avoid <a href="https://www.smartcompany.com.au/legal/34415-accc-issues-luv-a-duck-360-000-fine-for-misleading-claims">misleading customers</a>, they should ensure their teams are compliant with competition and consumer law.
“Often risks can arise when salespeople [who don’t know the law] are representative of the business,” he says.

<hr>
This article first appeared on <a target="_blank" href="https://www.SmartCompany.com.au">SmartCompany</a>.
 
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Telemarketing director and manager cop $100,000 in fines for “deceit” of five small businesses

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The demand for properties in inner city Sydney is at an all-time high. Properties are selling at record prices upon first inspection, and the huge influx of investors returning to the inner city property market, means there is a shortage of quality stock available – particularly for properties priced up to $1.2 million.
Many vendors are holding on tight; refusing to part with investments they bought years ago that are now yielding rental returns as high as $800 per week, on a property they purchased for just $400,000 10 years ago.
There was a time during the early 2000s that investors shied away from purchasing properties in the inner city. Banks tightening their lending requirements and only financing between 60-80% of property values meant that many investors were cut out of the market and properties under 50 square metres were very hard to finance at all.
This was a tough period for investing in inner Sydney. Hundreds of new apartments were released to the market each year, but heavy finance restrictions fuelled lots of bad press about investing in city apartments. At the time, many experienced city agents were managing 30-40 listings simultaneously, and the time-frames to sell these apartments would span up to 12 months.
How times have changed! If anything, the financial crisis has helped the city market by giving buyers the confidence to invest in property again, as opposed to other high risk investments and shares and stocks which can be volatile.
New developments have been selling out in just hours upon release, and command exuberant prices – including Barangaroo, which completely sold out in hours despite prices starting at $1 million for one-bedroom apartments, and most recently York &amp; George, another inner city development which sold almost 90% of its apartments on the first day of release.
Self-managed super funds have also gained momentum, buying up investments in the inner city market; yields are so good with the guaranteed reward of long-term capital growth.
We’ve also seen a growing number of tenants who have chosen to buy into the market so as not to pay the ever increasing rental prices. It’s all part of the shift toward more and more local and international residents embracing our fabulous inner city lifestyle, and just wanting to be in it to enjoy it. It’s no wonder why the city of Sydney is one of the most in demand property markets in the world.
While it is encouraging to see our once tough inner city market experience such a boom, properties at the higher end of the market are still harder to move. This is particularly true for those who bought off-the-plan for properties priced over $1.8 million in the past four to five years.
These properties are still averaging 12 months on the market and there is a much smaller pocket of people who can afford to spend $2-$6 million on apartments in the city. The higher end is predominantly owner occupied and over time we look forward to this end of the market picking up.
As we say goodbye to 2013 we are excited for the year ahead and once again look forward to a buoyant inner city market place.

<hr>
Carlie Ziri is the director of <a target="_blank" href="https://www.lifestylepropertyagency.com/" rel="nofollow">Lifestyle Property Agency.</a>
 
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Inner Sydney market is booming, but we're still waiting for top end to kick off

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Online retail spending growth is slowing, as sales in the past month increased by only 0.3%, according to the latest NAB figures.
The low growth rate for the past three month is likely to have been caused by the lower Australian dollar, but experts suggest it’s only a “blip” in the broader scheme of online retail growth.
The NAB Online Retail Sales Index for October 2013 reveals online sales have increased by only 16% to $14.4 billion for the past 12 months, notably lower than the 26% year-on-year growth rate recorded this time last year.
Since this time last year, NAB figures reveal the value of online sales has increased by $2 billion.
The past three months have been particularly poor for online sales growth, with sales growth from traditional bricks-and-mortar retailers exceeding online retailers in October, recording rates of 0.5% and 0.3% respectively.
Growth of 0.3% was also recorded in September and in August NAB figures show online retail sales actually contracted by 0.2%
Retail Oasis director Nerida Jenkins told SmartCompany the slowdown in growth in the past few months has been influenced by the lower exchange rate.
“According to the RBA daily exchange rates, the dollar dropped below 90 in the first month of the last quarter, so the level of sensitivity around that currency drop kicked off the level of conservatism in online sales,” she says.
“Daily deals, fashion and electronic goods fared worst in this period, showing the more discretionary retail goods and international retailers were most affected by the lower exchange rate.”
Spend on international online retail goods contracted by 0.5% in October.
As the growth in online spending dips, so is the value of purchases consumers are making.
NAB analysis found 90% of all transactions made in the past year were for products under $100, with less than 3% of transactions to the value of $250 and just 0.2% of purchases were over $1000.
The average value of an online purchase has dropped from $64 in January 2010 to $41 in October 2013.
NAB chief economist Alan Oster said in a statement more people are looking to purchase low-cost goods online.
“Retailers are cutting prices to build sales volume, changes to shipping arrangements and a significant increase in people purchasing low-cost media products like eBooks, movies and music online are factors driving the lower transaction sizes,” he says.
“While areas like homes, appliances and fashion have seen declines in the average transaction size, the groceries and liquor, and personal and recreational goods sectors have experienced an upward trend since early 2010.”
NAB analysis also reveals domestic retailers now make up the dominant force in the online retail scape, accounting for 73% of businesses, up from around 50% three years ago.
Jenkins says online spend should pick up again in the next few months.
“People have started to settle into the lower exchange rate now. Consumer behaviour toward online is now maturing, but it’s not at an end,” she says.
“It will continue to grow in double digit figures, although perhaps at slower rates. Forces like the exchange rate and taxes will continue to act as short-term stimulants and detractors, but will not have much impact in the long term.”
This year online retailers have been pushing for the <a target="_blank" href="https://www.smartcompany.com.au/finance/tax/34727-gst-threshold-for-online-shopping-how-australia-stacks-up-compared-to-the-world">GST levy on overseas online goods to be lowered</a> from $1000 to $20.
Based on NAB’s retail figures, should the GST threshold be lowered to $25, this would yield revenue of $309 million.
Jenkins says this amount will not be enough to cover the administration costs.
“The level of administration to collect the tax will be higher,” she says.
National Online Retailers Association chief executive Paul Greenberg toldSmartCompany retailers need to “stop holding their breath about the GST and stop using it as a smokescreen for not innovating”.
“As an industry we’ve been waiting for some act of God which will give us some relief by levelling the playing field or a lower Australian dollar, but we’re deluding ourselves,” he says.
“We should stick to the three key pillars improving the technology of our business, looking at global opportunities and being customer-centric.”

<hr>
This article first appeared on <a target="_blank" href="https://www.SmartCompany.com.au">SmartCompany.</a>
 
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