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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More than a quarter of those aged 17 to 24 in Australia are not in full-time work or full-time study, according to a Council of Australian Governments (COAG) report released today.
In some states, like Queensland, South Australia and Tasmania, that figure edged closer to one in three. And among young people from disadvantaged backgrounds, that figure was above 40%.
The findings, gleaned from a report on education outcomes across Australia’s states and territories, reveal a difficult transition from school to employment.
The number of young people in full-time work or employment has declined 1.2% since COAG last looked at the issue in the relative boom-times of 2006. Even then, however, the figures showed 26.1% of young people in that age bracket were not in full-time work or education. Now 27.3% of Australia’s young people fit into this category, which the report states puts them at a greater risk of an insecure future.
The falling labour force participation by young people was partially offset in COAG’s figures by a rise in young people in full-time education. The proportion of 17 to 24 year olds engaged in full-time study increased from 28.6% in 2006 to 32% in 2011.
<a target="_blank" href="https://theconversation.com/coag-education-reports-show-early-childhood-and-year-12-are-key-19611">Speaking to The Conversation,</a> Greg Craven, deputy chairman of the COAG reform council and vice-chancellor at Australian Catholic University, said this was of concern.
“What happens to young people when they leave school is crucial to how we meet the future demands of our economy – and to the quality of their lives,” he said, crediting the worsening situation, in part, with the lingering effects of the global financial crisis.
The Australian Chamber of Commerce and Industry said the release highlights “the immediate need for a concerted effort by both state and national governments to boost youth employment and put skills development integrated with work for young Australians back on the national agenda”.
The employer body pointed to the <a target="_blank" href="https://www.smartcompany.com.au/growth/economy/33180-Stop-cutting-apprenticeships,-industry-groups-tell-politicians">removal of government incentives around apprenticeships</a> as having caused a drop in apprenticeship numbers. “The apprenticeship has been neglected by government and needs to be revived so we do not create a lost generation of Australians who missed out on opportunities to develop skills that enable them to secure sustainable employment.”
Young unemployment is regularly higher than Australia’s overall unemployment rate. According to the <a target="_blank" href="https://www.theaustralian.com.au/national-affairs/high-rate-of-youth-unemployment-will-hurt-future-productivity/story-fn717l4s-1226733071548">Australian Bureau of Statistics figures</a>, which measure the number of young people 15 to 19 years old who are not studying and are actively looking for work, 25.5% of young people are unemployed. Total unemployment in Australia is 5.7%.
The issue of youth unemployment came up in the recent federal election campaign. The then-government considered forcing young job seekers into <a target="_blank" href="https://www.smh.com.au/national/alp-eyes-youth-dole-boot-camps-20130727-2qrmk">army-style youth boot camps</a> before giving them the dole, while the Liberal-National coalition went to the election with <a target="_blank" href="https://www.dailytelegraph.com.au/tony-abbotts-message-clean-up-your-acts-or-do-without-dole/story-e6freuy9-1226589493861">a policy</a> to suspend dole payments for those under 30 if unskilled work is available in their area.

<hr>
This article first appeared on <a target="_parent" href="https://www.smartcompany.com.au">SmartCompany</a>.
 
 
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mrobin-TVRYiru7si

Youth unemployment stats: one in four young Australians not in full-time work or study

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A lifting of fixed-term mortgage rates by the big four banks has startled the market.
Pre-empting the Reserve Bank’s regular monthly meeting next Tuesday, the Commonwealth Bank, NAB, ANZ and Westpac each raised some of their rates, possibly in response to higher borrowing costs on the wholesale market.
The Commonwealth’s three-year fixed term rate remains steady at 5.09%, while its four-year fixed rate rose 0.20% to 5.74% and its five-year fixed rate also rose 0.20% to 5.84%.
Westpac’s three-year term rose yesterday from 4.99% to 5.19% while its four-year fixed rate is steady at 5.49% and its five-year fixed rate is also steady at 5.79%.
National Australia Bank lifted its fixed term rates on Monday: Three years fixed rose 0.20% to 5.19%; four-years fixed is steady at 5.64% and five-years fixed rose 0.24% to 5.79%.
The ANZ raised its three-year fixed rate from 5.14% to 5.34% on Friday. It did not change its four or five-year fixed rates. A staffer said rates "could go up or down depending on what’s going on in the market".
Neither IngDirect, Bankwest, St George or UBank had made any changes, staffmembers said.
Buyer’s advocate Todd Hunter, of the wHere Group, said he had put out a notice to alert his clients to the rises, which may have been prompted by the banks "Probably not being able to find money as cheap anymore".
"This is probably the right time to fix," he added, saying rates – even after the rises – are "still looking very attractive". He recently locked in his loans at 4.99%.
"Money is still cheap and anything under 5.5% is extremely low and you’ll be doing well."
Although he "can’t foresee any dramatic movements in the variable rate", Hunter admitted he is not sure what the market is going to do next. "It’s safer to wait until after Tuesday’s meeting. But if the big four go up it’s a sure bet the smaller banks and building societies will follow."
One thing’s for sure, if the Reserve Bank on Tuesday does cut mortgage rates, the banks which raised their rates will look greedy, even though fixed rates are usually higher than variable rates.
Hunter said average variable rates over the past 10-15 years were in the mid-sixes "although there have been plenty of ups and downs in the meantime".
One reason the Reserve Bank may hold rates is concern over unemployment, currently sitting at 5.6%  according to the Australian Bureau of Statistics. The participation rate, which is the proportion of people in work or looking for work, fell to 64.9%, the lowest level since November 2006.        
Jessica Darnborough, of Mortgage Choice, said she expected a few more rate movements across the board but "only slightly" and not in November.
"The yield curve was at historic lows recently but it’s now on the way back up so we may see more movements in the fixed arena."
Although not into "crystal ball gazing" Darnborough said she would be surprised if the RBA raised rates on Tuesday. However, fixed rates are affected by other external factors and she sees a "little bit of a trend" for upward movements in that category.
Optimistically, she said: "The banks are still competing for market share, so we may see downward movements against trend."
The banks’ three-year fixed term is said to be the most popular.
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staylor-63KgDrKwoY

Big four banks lift rates, startle the market

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A new crisis-scandal-outrage has emerged in real estate. It’s the issue of Chinese investors buying Australian real estate.
This has brought out all the usual hysteria and misinformation. They’re taking over Australia; we’re being invaded by stealth; they’re squeezing out first-home buyers; they’re creating a bubble; etc, etc.
We have wannabe buyers being outbid at auction and complaining because the successful buyers were Asian-looking and therefore, according to the aggrieved parties, Chinese investors. They could be third-generation Australians, for all they know.
It’s reminiscent of the eighties, when high levels of Japanese investment allowed newspapers to whip up a xenophobic frenzy.
Louis Christopher, managing director of SQM Research, this week described reaction to Chinese investment in similar terms. “This current fear that the Chinese might buy all our property is nothing but xenophobia,” he said.
There’s only one aspect of this that’s in any way outrageous – and that is the way Australian developers and their marketers are peddling bad real estate at inflated prices to distant investors.
There’s nothing new in this. Developers have always targeted distant investors to, firstly, get rid of unsold dwellings for which there are no genuine local buyers – and, secondly, to go a step further and create new stock specifically to sell to distant investors, notwithstanding the local over-supply or depressed market.
In the past, the victims have been found interstate, out west or in New Zealand. Now Asia is being targeted, especially China.
Marketing teams are taking roadshows to China and using deception to induce investors there to buy highrise apartments or house and land packages in poorly-performing markets.
There’s no crisis here, but one might emerge if Australian investors follow the advice that’s starting to emerge – namely, that they should be buying where the Chinese are buying.
I would suggest Australian buyers do the opposite. Avoid like the plague any markets being pitched to the Chinese. They’re being sold product in oversupplied markets, usually at prices above true market value. They’re not markets a sensible investor would want to be in.
The Gold Coast, often the birthplace of Australia’s worst property scams, is emitting propaganda along these lines: Australians should be buying Gold Coast high-rise because the Chinese are, and we all know how much research the Chinese do!
This is as bad as investment advice gets. Many foreign investors are not undertaking independent research – they’re being fed lies and propaganda disguised as research.
It’s a situation that’s adding to the already-serious glut of apartments in the inner-city areas of Melbourne. Current vacancy rates, according to SQM Research, are 7% for the CBD, 7.2% for Docklands and 7.8% for Southbank, but they’re continuing to build more and more apartments in these areas. This is happening because developers are able to flog them to Chinese and other Asian buyers.
We are likely to see a similar scenario in inner-city Sydney for the same reasons.
A tremendous shake-out is looming in some of these markets, although it may take a few years to materialise.
 
<hr>
 Terry Ryder is the founder of <a style="font-size: 14px;" target="_blank" href="https://www.hotspotting.com.au/" rel="nofollow">hotspotting.com.au</a> and you can contact Terry via <a href="https://mailto:%20ryder@hotspotting.com.au" target="_blank">email</a> or on <a style="font-size: 14px;" href="https://twitter.com/hotspotting" target="_blank">Twitter</a>.
 
 
 
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terryryder-YECXbqmri2

Australians shouldn't fear Chinese buyers, but should fear the developers marketing to them

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It occurred to me that while most people seem to have an opinion on the negative gearing debate (usually based upon their current status as a landlord, homeowner or renter, which is natural enough) few seem have a grasp of what the numbers involved might look like for an individual taxpayer.
In fact, when numbers are involved in almost any debate the eyes of a fair percentage of people slowly glaze over before you are met with a blank stare, and, if you are particularly unfortunate, some drool. Below are some actual examples (I've rounded off the numbers for the sake of simplicity).
1 - Positive gearing - large deposit
Although property gurus try to sell the idea that positively geared property - where the rental income covers all costs of ownership - is somehow mystical and complicated, it's actually a simple concept which is often largely related to how a deal is financed. An institutional residential fund might undertake a major renovation or subdivision and renegotiate leases in order to achieve the outcome, but there are much simpler ways in which a private investor might secure a positively geared property.
One is to use a very large deposit. Here are is an actual example of a $200,000 regional one-bedroom unit which generates a 6.25% rental yield. The purchaser uses a sizeable 50% deposit and an interest only mortgage fixed at a rate of 5%, and thus receives an income each year.
Rental income - 6.25% yield                     $12,500
Mortgage - interest only at 5%                 $(5,000)
Repairs, management, strata fees etc    $(3,250)
Net cash flow per annum                             $4,250
The main downside to this approach is that the landlord needs a very large deposit (when the use of leverage is diminished so too are the projected returns, and thus residential property becomes considerably less appealing as an investment).
Further, regional properties have historically achieved significantly lower capital growth rates, which accounts for the higher percentage rental yield. Yes, of course, over any given time period capital growth might be solid, but over the long term capital growth rates tend to be highest where the demand is strongest, a real estate trend that is easy to witness all over the globe.
2 - Positive gearing - cheap cost of capital
When mortgages rates are cheap then it's also easily possible to positively gear property. Here's a property bought for £200,000, a 1 bedroom flat in London using a 25% deposit and which generates a 5.2% yield. Mortgage rates are very cheap in Britain and therefore the net cash flow before tax in this example is instantly positive, even before any allowances which might be claimable on furnished properties.
Rental income - 5.2% yield                                   £10,400
Mortgage - interest only @ 3.5%                       £(6,125)
Repairs, management, service charge etc     £(3,000)
Net cash flow before tax per annum                 £1,275
3- Positive cash flow in Australia
In Australia, we have the so-termed negative gearing tax legislation whereby certain losses on investment property can be offset against other forms of income on an individual's tax return. In some circumstances this can turn a cash flow loss into am effective positive cash flow after depreciation allowances and associated tax savings are factored in.
Let's use the regional one-bedroom unit property in example one again, but this time the buyer has only used a 10% deposit and has claimed depreciation allowances on the property of $2,000. The mortgage remains an interest only product at a rate of 5%.
Rental income - 6.25% yield                     $12,500
Mortgage - interest only at 5%                 $(9,500)
Repairs, management, strata fees etc    $(3,250)
Net cash flow per annum                             $(250)
Add back allowances                                     $(2,000)
Loss on tax return                                          $(2,250)
Tax saving at 37% marginal rate              $833
Cash flow after tax                                          $533
In this instance, the depreciation allowance and the prevailing tax rules have turned a small net loss into a small positive cash flow, assuming that the taxpayer is paying PAYG income tax at the 37% marginal rate (I've disregarded the 1.5% Medicare levy here).
4 - Negatively geared property
OK, so onto an example of a typical negatively geared property as things stand today. In this example, a higher rate taxpayer has bought a $650,000, two-bedroom capital city property, which generates a 5% yield, using a 10% deposit. The mortgage is once again interest only at 5%.
Rental income - 5% yield                                $32,500
Mortgage - interest only at 5%                     $(29,250)
Repairs, management, strata fees etc       $(10,000)
Net cash flow per annum                                $(6,750)
Add back depreciation                                    $(3,000)
Loss on tax return                                             $(9,750)
Tax saving at 45% marginal rate                  $4,388
Cash flow after tax                                              $(2,363)
5 - Malinvestment?
So, what's the big deal, you may ask? In the example above, the taxpayer made a net cash flow loss - although not a chronic one - and saved a bit of tax. So what?
Well, one issue is that we currently have a cash rate of 2.50% which is sitting at around 50 year lows. What happens if mortgage rates are at, say, 10%, and a higher rate taxpayer buys an expensive property which generates only a low yield, predominantly for the purposes of saving tax?
This is not an actual example, so we can perm any numbers we like here. But let's use this example of a $1 million apartment property which generates a weak 3% rental yield, has high other strata and holding costs and only has a small amount of depreciation claimable. It's financed at some time in the future using an 10% deposit and an interest only mortgage at a rate of, say, 10% per annum.
Rental income - 3% yield                               $30,000
Mortgage - interest only at 10%                 $(90,000)
Repairs, management, strata fees etc       $(20,000)
Net cash flow per annum                                $(80,000)
Add back depreciation                                     $(2,000)
Loss on tax return                                              $(82,000)
Tax saving at 45% marginal rate                   $(36,900)
Cash flow after tax                                              $(43,100)
Arguably the landlord is making this purchase largely for the purposes of saving tax, for without the negative gearing rulings the property would generate a huge annual cash flow loss, as much as $80,000 in year one. Although the property will generate a positive cash flow eventually (as rental income tends to increase over time in an inflationary economy) this could take many, many years to eventuate and thus the owner is largely speculating on capital gains rather than the growing income stream.
Will negative gearing tax legislation be abolished?
The debate rumbles on, with both sides tending to highlight the issues which suit their own side of the argument. When the rules were amended and losses quarantined in 1985 for a short period of time, the REIA argues that "rents rose 37% across Australia and 57% in Sydney".
Those in favour of scrapping the legislation retort that if you deflate rental increases by the CPI (inflation) rate then the increases were only real and significant in Sydney and Perth. A fair point, although the 'basket' of CPI goods itself includes rental costs, so to some extent that could be something of a circular argument. In any case, renters don't adjust rent increases (or the cost of anything else for that matter) for CPI; they simply look at their actual rent payments.
What happened in 1985 is less relevant than might happen today if losses were once again quarantined. Intuition tells me that landlords would use the shift to the new environment as an excuse to attempt to jack up rents immediately. Whether or not they would be successful in so doing is harder to judge. Common sense dictates that the odds of 'success' for the landlord would be higher where rental vacancy rates are low, such as in certain middle-ring Sydney suburbs or in Darwin, and lower where there is an over-supply of stock such as in Melbourne's Docklands or in a number of regional areas.
We should also be wary of trying to rewrite history. Read books which touch on the subject written in the first half of the 1990s and the increase in Sydney and Perth rents is only cited as a secondary reason for the reinstatement of the negative gearing rules. The principal reason cited was a jump in housing waiting lists (in New South Wales the numbers increased "from under $110,000 to above $140,000" during the period for which the rules were changed, a worrying "trend which was immediately reversed" upon their reinstatement.
It's also possibly an over-simplification to say that governments will simply save dollars by scrapping the existing rules. I believe his numbers on housing lists may be inaccurate ("the waiting lists for public housing increased by 50% in 1985") but tax accountant Ed Chan highlights why he believes government costs and impacts on the wider economy would escalate if more public housing was required <a href="https://www.chan-naylor.com.au/getting-rid-of-negative-gearing-and-private-school/" target="_blank">in this article here</a>.
Conclusion
Clearly from 1987 to date the government has steered away from the risk of crashing the housing market (and the Aussie economy?) by again altering the tax legislation, but that does not mean that it will never do so. Personally, I think it's unrealistic to expect that the rules will be amended in one fell swoop due to the potentially destabilising effect: it's hard to envisage risk-averse politicians taking that chance.
The most sensible viewpoints I've heard are from property expert Catherine Cashmore, who suggests that the existing rules might be slowly unpicked while other strategies are implemented to attack Australia's supply-side issues - <a href="/news">take a read here</a>. There are a number of ways in which this might be kick-started - one might be to limit the number of properties which a landlord can claim losses on.
"I have no doubt if the policy were removed, or even scaled down, there would be less demand for established stock and a subsequent dampening in prices.  I agree that a sudden and complete retraction of negative gearing in its current form would be foolish - favouring a slow wind-down whilst other policies are implemented such as strategies to aid development and increase supply."
While landlords often seem to want property prices to grow to the sky and renters want to see an instantaneous property crash, neither of these outcomes is desirable for our wider society or for our economy. Far better, in my opinion at least, would be a prolonged period of moderate property price growth which is somewhat slower than the rate of household income growth (thus making real prices more affordable over time). The problem facing us is that humans are irrational beings and thus tend towards boom and bust, but that doesn't mean that we shouldn't try.

<hr>
Pete Wargent is the co-founder of <a rel="nofollow" target="_blank" href="https://allenwargent.com/">AllenWargent</a> property buyers (London, Sydney) and a best-selling author and <a rel="nofollow" target="_blank" href="https://petewargent.blogspot.com/">blogger</a>.
His new book '<a rel="nofollow" target="_blank" href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx">Four Green Houses and a Red Hotel</a>' is out now.
 
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Negative gearing: what practical effect does it have and should it be changed?

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One of the most important steps you take, very early on in your investment career, is to identify and decide what type or class of investment is going to work best for you. Those who don't seek professional advisers conduct their own intensive research and due diligence. Basically, those who educate themselves and learn as much as possible will always have the best start to investing compared to those who don’t.
But beyond that, it is those individuals who are able to maintain a momentum over the years – and not just treat their investing life as a ‘set and forget’ approach that should be left to gather dust – who fare better as investors and are almost always rewarded more handsomely for it.
Before even thinking specifically about property as a class, you need to consider it against other investment classes, to work out if it is right for you. Perhaps the best way to do this is to work backwards. Start first by giving yourself answers to the below three main investment factors:
<ol>
<li>
Personal life timing and situational variables - These are things like your current age, income and means, borrowing capacity to invest, perhaps marriage or family commitment status and so on – how will these factors affect my time and energy I can put into any investment?
</li>
<li>
Knowledge and time limits - Your previous exposure to existing investment classes and/or your willingness to learn, and level of pro-activity and effort you can feasibly to put into researching and educating yourself with – how committed am I and how much time am I willing to dedicate?
</li>
<li>
Your risk profile - Your level of risk you are willing to live with, remembering that all investments will always carry some degree of risk with it. Can I sleep easily at night, knowing a portion of my savings are tied up in something that is constantly changing?
</li>
</ol>
The investment class you decide on will be shortlisted simply by the way you answer the three above areas.
I’ll give a brief overview of the main investment classes that many people choose from. Through this, it may give you an idea of the commitment level involved, and top-line risks associated with some of the major investment classes. Though there are many more investment types beyond what is listed, it will give you a good starting place to learn more about asset classes. As mentioned above, seeking the advice of a professional adviser is arguably one of the best courses of action you can take.
Shares:
-          Easy entry/exit process, and minimal costs to do so;
-          Works well for investors with not much starting capital – you can purchase shares online yourself through many online platforms such as E*Trade, iShares, and CommSec;
-          Risk flexibility is possible because you can opt for ‘safer’ blue-chip, ASX 200 companies with high pedigree and proven long term performance. Or, if your risk profile is higher, you can opt for more dynamic start-up or rapid-growth companies where the risk is greater, but so is the return
-          Shares do not work well for those who will have trouble getting to sleep each day without some kind of ‘status update’ from their share portfolio. Whilst such updates are available in real-time, checking them frequently daily is probably not a good mental space to be in, if you are the instant-gratification persona type.
Gold:
-          Finite global supply, increasing global demand. This makes for a solid investment type;
-          Risk profile is moderate for gold, as macro-economic market influences can greatly skew or influence performance of gold at any moment;
-          Gold used to be one of the safest investment classes. However, its connection with share market volatility leaves it open to greater influence and fluctuation;
-          Despite this, gold is a proven performer when the global economy weakens – and especially when major currencies weaken.
Cash and fixed interest accounts:
-          One of the ‘safer’ investment classes mainly because these come with the assurance and backing of financial institutions such as the big-four banks;
-          Fixed interest accounts come mostly in the form of government and corporate bonds, effectively operating in the same way as loans;
-          Interest payments are regular, enabling investors to re-invest the proceeds and add a compounded growth effect to their investment;
-          With lower risk does come lower reward as earnings over time are more modest in comparison to other asset classes such as gold, property, and shares.
Property:
-          There are a number of sub-classes of property. Most people immediately think ‘buying a residential property’ as property investment, and for most people this is true;
-          However, this class includes commercial and industrial properties as well (full ownership per investor), as well as investing in property securities, whereby an investor commits to a larger pool of like-minded investors who invest in a group that secures hundreds and thousands of various properties across different property classes;
-          Whatever the investment approach, property is certainly a medium-long term investment class for most people as the entry and exit costs and process and expensive and slow. This means if you were to get in and then out again within a year administrative fees would likely wipe out any gains made;
-          With the exception of property development, those who are looking to make a quick buck are out of luck here. As mentioned above, the entry and exit costs for single-title-owner properties are to prohibitive to do so without making a complete loss on the investment overall. So this is a caution to those who prefer a faster paced performance class like shares.
So why choose property over other classes?
This is a question open entirely to different views, opinions, and belief. In short, property works for those who find it suits their risk profile and objectives, over a medium-to-long period of time. It won’t work for those with a get rich quickmindset. Personally, I value the complete ownership of a property, as the key unique advantage of this class. When I own a house or apartment, I own it entirely and am able to make all of the operational decisions on that property.
This is different to, say, purchasing shares in just one company, like, for example, McDonald’s. You may have bought your shares with the understanding that McDonald’s is a sound investment due to the products it produces being in high demand by consumers. But what if, overnight, McDonald’s chose to make all restaurants vegetarian-only? As an shareholding investor, you have no control over how the company actually operates. McDonald’s could lose two thirds of its customer base overnight because of the decision, and you as a shareholder would suffer the loss. An extreme and unlikely example, sure, however when blue-chip companies acquire and merge with others, changes to the company product lines and demand often result.
With property, even though operational decisions (for apartments and units anyway) are made in collaboration with a majority-agreed strata committee, this is usually on a much smaller scale, meaning your voice in any operating decision changes is that much louder. With houses of course, investors have 100% decision-making control over the ongoing management of that asset. So, with the right kinds of property purchases, an investor is able to have a real voice in the management of the running of the investment.
Considering the investment class that will work best for you is all about knowing the facts about each class and making an informed decision before diving into anything. Do not rely solely upon the verbal advice of friends or passing comments at dinner parties; do you  due diligence, seek professional insights, and go from there.
 
<hr>
 Cameron McEvoy is a NSW-based property investor and maintains a blog, <a href="https://www.propertycorrespondent.com.au/" rel="nofollow" target="_blank">Property Correspondent.</a>
 
 
 
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Is property the right investment class for you?

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I found a really cool message on YouTube from a young entrepreneur called Vik Nithy about procrastination.  I was web surfing instead of writing this article...I guess I was procrastinating!
I think procrastination can be our number one enemy when it comes to moving forward not only on a property transaction or strategy but in life in general.
Procrastination is choosing whether you’ll do it now or do it later.
Often our heads are in conflict – lie on the lounge or research that property deal?  Go to the beach or phone the solicitor to discuss the contract? Catch up with friends or attend that open house?
Mostly we procrastinate on things that we are not sure about or committed to.  From my own perspective, I never procrastinate if it is work (well...maybe over some little things!) or investment related because I love what I’m doing in these areas and I have specific goals. The other reason is that if I procrastinate over a potential development site, someone else will get it.  There is no time to waste when you’ve located a good deal.
But I’ve been going through some procrastination lately on another level and it’s because I really have not known what I want. This has prompted me to delve deeper and find out why – identify the reason I’m avoiding things.
That’s the secret...knowing what you want. Sounds easy and it can be if there is passion and belief behind what you do.  If you can sit down and plan your goals and make a commitment to them, then there will be less what <a target="_blank" href="https://www.youtube.com/watch?v=WD440CY2Vs0">Vik calls “monkey mind”</a>.
“Monkey mind” is the part of your brain, or the voice in your head that reacts to a threatening stimulus. Perhaps, it’s really not knowing where to start researching for your property investment or questioning whether you should actually buy the property you’ve been researching for weeks?  Or if you should develop one of your properties because you know it will add value but you just don’t know where to start.
Decision making shuts down procrastination.
Being focussed and motivated is another weapon you can use. I always come back to the core reason I’m investing in property which is to set myself up for retirement and there really is no time to waste. My financial planner says we’ll need around a million dollars in our superannuation to live comfortably - not luxuriously - when we retire.
Procrastination is an anxiety response. Make a decision and have faith in yourself and there will be no procrastination.
Ask “What is it that you’re afraid of?”  Once you can identify your fears, you can overrule them with facts.
For instance, “I’m afraid I’ll lose my money” Answer: if you’ve researched well, you will only lose money if you sell at a loss. If you have the capacity to hold over the long term – ten years or more - then generally you will be OK, as property in good locations doubles in value every ten years.
I love this quote by Napoleon Hill: “Don’t wait the time will never be just right.” 
I can confirm this with my own investments; in fact some have tripled in value over this time. But to take out any fear, make sure the investment is within your means.
But often our means can stretch if we need it to. As Oscar Wilde said “Anyone who lives within their means suffers from a lack of imagination.”  There is always ways of making more money.  If your goals are to build wealth then you may need to put yourself out there, we can usually cut spending in other areas or find new ways to support our investment.
We must plan. Write down what you are expecting from the investment and remember that if things don’t turn out the way you wanted, failure is a positive learning experience. It’s better to learn from our mistakes than not to have tried at all.  “Anyone who has never made a mistake has never tried anything new.” - Albert Einstein
If you take on this attitude, fear will dissipate, procrastination will disappear and you will move in the direction of your goals and dreams.
 
<hr>
 Jo Chivers is director of <a title="Property Bloom" href="https://www.propertybloom.com.au/" target="_blank" rel="nofollow" style="font-size: 14px;">Property Bloom</a>, which manages property development.
 
Check out our new website <a href="https://www.propertybloom.com.au/">www.propertybloom.com.au</a>.
 
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Planning, research and then taking action are the keys to successful investing

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Choosing the right property manager can be a difficult process for many investors, particularly if you're in an area where they are few and far between, such as remote regional locations.
Our tweet of the day, from Real Estate Mondo, has a look at some of the things you must remember when choosing this expert.
<blockquote class="twitter-tweet">
How to Find an Awesome Property Manager <a target="_blank" href="https://t.co/FRuDImDcId">https://t.co/FRuDImDcId</a>
— Real Estate Mondo (@RealEstateMondo) <a target="_blank" href="https://www.propertyobserver.com.au/https://twitter.com/RealEstateMondo/statuses/395643036430249984">October 30, 2013</a>
</blockquote>
Adding onto this list, Property Observer also recommends asking for copies of their inspection reports, and quizzing property managers on their processes and approach should situations not turn out favourably. As you are, essentially, hiring this person - treat it like an interview!
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Finding the best property manager

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Not everyone goes through the usual paths to achieve finance.
A Norwegian man who invested $26.60, or 150 kroner, in bitcoins four years ago, recently found that the growth of the investment had soared to $866,000 in worth.
Kristoffer Koch bought 5,000 bitcoins in 2009 after finding them while writing a thesis on encryption, reported NRK.
However, like most of those in the digital world, after four years he could not remember the password and spent an ensuing day trying to gain access.
When he did, over $850,000 (1.1 million kroner) was waiting for him.
After 28% in taxes, he had enough for a deposit and for restoration funds for a unit in Oslo. It was worth 2.6 million kroner and is one of the world's most expensive cities.
A true set and forget investment for Koch.
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$27 bitcoin stash used to buy house

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While exit fees are no longer allowed (on loans from 1 July 2011), you will want to be aware of any costs you may incur.
<hr>
This article is from Property Observer's free ebook <a target="_parent" href="http://propertyobserver.com.au/ebooks/free-ebook-mastering-the-art-of-refinancing-12-tips-for-success-and-key-things-to-consider">Mastering the Art of Refinancing: 12 tips for success and key things to consider</a>.
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Determine the costs of leaving your current loan

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Three penthouses have sold off-the-plan in the West End riverfront development Vida, totaling $8.9 million in sales and knocking the development up to 95% sold.
The $100 million development by private developer Pointcorp has one dual-level penthouse remaining, priced from $3 million.
Nearly all of the four-bedroom apartments have been snapped up between $1.55 million to $1.72 million and a range of three-bedroom apartments have sold between $1.25 million to $1.4 million.
"We have sold 12 apartments for in excess of $1.25 million in a matter of months," says Pointcorp sales and marketing manager Sam Patterson
"That is in stark contrast to the demand that has been experienced in Brisbane over the past few years, with the majority of interest targeted toward smaller, entry level apartments.
"As a result, most new developments released in recent times have catered to this market, so to have this type of success with a project that is specifically designed for those wanting a larger apartment with the highest quality fittings and finishes is a real sign the market has begun to shift,” says Patterson.
All three penthouses were sold to owner-occupiers.
"Each of our apartment types has been designed with a significantly larger floor plan than the average apartment in Brisbane, making them appealing to those who want to live in their apartment, and the position on the river, so close to the CBD and in West End adds to the appeal.
"While West End has long been renowned for being a 'trendy' area to visit, it is really still emerging as a residential hot spot.
“Savvy buyers have recognised this and are looking to secure their place now to take advantage of its urban renewal,” says Patterson.
Designed by Cottee Park, Vida comprises of 148 apartments across two 12-level riverfront buildings.
Remaining apartments are priced from $409,000 to $3 million.
Viva was released to the public in June, with construction to start later this year.
The median apartment price in <a target="_blank" href="/news">West End</a> is $220,000, a 25.2% decline in the past five years, according to RP Data.
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