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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The South Henley Beach house that drew the attention of the police earlier this month after real estate listing photos inadvertently showed alleged marijuana pot plants in the backyard, sold at weekend auction for $629,000.
The property in the western suburbs of Adelaide just a few blocks from the beach was marketed by Arthur Dimitrak from Harcourts Mile End who said it sold just above the reserve price.
The <a target="_blank" href="https://www.propertyobserver.com.au/auctions/adelaide-henley-beach-joint-to-go-to-auction-on-saturday-%E2%80%93-but-alleged-marijuana-pot-plants-nipped-in-the-bud/2012121358458">photographs of the alleged marijuana pla</a><a target="_blank" href="https://www.propertyobserver.com.au/auctions/adelaide-henley-beach-joint-to-go-to-auction-on-saturday-%E2%80%93-but-alleged-marijuana-pot-plants-nipped-in-the-bud/2012121358458">nts</a> prompted a surprise police inspection, seizure of the plants and a court date for one of the occupants.
There were eight registered bidders for the house, but only two bidders on the day. RP Data records show it last sold for $130,000 in 1993.
The two-bedroom brick house standing on a 936-square-metre block and is tenanted until February next year.
The new owner is likely to demolish the existing house and develop the site for townhouses.
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Investor snaps up Adelaide South Henley Beach “pot” house

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Melbourne's median house price increased by a "relatively subdued" 0.5% for the first 10 months of 2012, according to Australian Property Monitors. 
"Melbourne’s housing market saw increased activity from first-home buyers and a lift in buyer activity in the prestige market," says APM. 
"Investors and first home buyer are set to remain relatively inactive as a consequence of Australia’s least competitive capital city rental market."
APM notes a "looming oversupply" of apartment stock coming on line and as a consequence forecasts high vacancy rates, stagnant rental growth and falling unit prices in the Victorian capital. 
 
"Melbourne house prices should increase by up to 3% in 2013."
This is below expectations for many other capital cities.
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Melbourne house prices in 2013 - zero to 3% forecast range: APM

<html><body>Australian Property Monitors (APM) has released a list of results from 414 auctions in Sydney for the weekend of December 15. The clearance rate was 57.2%. <a href="https://www.homepriceguide.com.au/saturday_auction_results/Sydney.pdf" target="_blank"> Click here</a> for the auction results, and click on each street address to see the property's marketing.</body></html>

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APM's 414  Sydney auction results show 57.2% clearance rate

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Inspired by Gold Coast’s Palazzo Versace hotel – which recently sold for $68.5 million – Property Observer has compiled a round-the-world guide to fashion designer hotels. 
The trend first started in 2000 with the opening of Palazzo Versace and has now extended to Milan, Paris, Jamaica and London, to name a few destinations. 
Luxury fashion designers that have jumped on the fashion branded hotel hype include Armani, Oscar de le Renta, Bulgari, Moschino, Missoni and many more.
<a href="https://www.lebellechasse.com/" target="_blank">Hotel Bellechasse, Paris</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/stories/2012/09/bellechasse.jpg">
Rooms in the luxury Hotel Bellechasse are all individually decorated by French fashion designer Christian Lacroix. Hotel Bellechasse offers stylish and arty accommodation in the chic and trendy seventh arrondissement.
 
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 <a href="https://www.palazzoversace.com.au/" target="_blank">Palazzo Versace, Australia</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/stories/2012/09/palazzoversace.jpg">
The luxury five-star accommodation was the world’s first fashion-branded hotel owned by Italian fashion company Versace. With picturesque waterfront settings, Italian furnishings and vaulted ceilings hand-detailed in gold, the Palazzo Versace has an ambiance of pure glamour.
 
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<a href="https://dubai.armanihotels.com/" target="_blank">Armani Hotel Dubai</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/stories/2012/09/armanidubai.jpg">
The Armani Hotel in Dubai is personally designed by Giorgio Armani and consists of 160 guest rooms. The luxury hotel promises a home away from home experience, with the hotel design an expression of Giorgio Armani’s passion for the sensual. Each element in the design plays a precise role, with Armani reluctant to leave a single detail to chance.
 
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<a href="https://www.hotelmissoni.com/hotelmissoni-edinburgh" target="_blank">Hotel Missoni Edinburgh</a>
 
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/stories/2012/09/hotelmissoni.jpg">
Hotel Missoni Edinburgh is the only five-star luxury hotel on historic Royal Mile in the heart of the Scottish Capital. The 136 guest rooms and suites are owned by world-renowned Italian fashion house Missoni, which embraces the phrase “bold, passionate and fashionable.”
 
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<a href="https://www.hotelmissoni.com/hotelmissoni-kuwait" target="_blank">Hotel Missoni Kuwait</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/stories/2012/09/missonikuwait.jpg">
The Hotel Missoni in Kuwait encompasses 18 floors of Missoni’s iconic contemporary design, with colours of desert and sea, gold, sand, turquoise and mosaic.
 
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<a href="https://www.bulgarihotels.com/en-us/milan/the-hotel/overview" target="_blank">Bulgari Milano, Milan</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/stories/2012/09/bulgari.jpg">
Since 1884, Bulgari has been setting the pace for Italian style in jewellery, watches, accessories, fragrances, skincare and leather goods. Now branching into the trend of fashion hotels, Bulgari renovated the 18th-century Milanese Palazzo hotel in Milan. It includes a 4,000-square-metre private garden that is visible from the ample windows in the 58 rooms, offering guests serenity and relaxation in busy Milan.
 
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<a href="https://www.bulgarihotels.com/en-us/shanghai/overview" target="_blank">Bulgari Hotel, Shanghai</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/stories/2012/09/bulgari2.jpg">
Located in the riverside complex of historic Zhabel District, the Bulgari Hotel Shanghai is designed by world-class architecture design team Foster and Partners. The luxury hotel contrasts ancient and modern architectural themes, a reflection of the Suhe Creek surroundings. The Bulgari hotel in Shanghai is set to open in 2015.
 
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<a href="https://milan.armanihotels.com/" target="_blank">Armani Hotel Milan</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/stories/2012/09/armanimilan.jpg">
The Armani hotel in Milan consists of 95 guest rooms, and rack rates range from $576 to $1,292 a night. The five-star exclusive luxury hotel in Milan offers a “lifestyle manager” who will give you a call or send an e-mail to see if there’s anything he can do for you before you arrive.
 
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<a href="https://www.bulgarihotels.com/en-us/bali/the-resort/overview" target="_blank">Bulgari Resort, Bali</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/stories/2012/09/bulgaribali.jpg">
The Bulgari Resort in Bali is a mix of traditional Balinese forms and high Italian style. Located 150 metres over the sea, the luxury resort is the second from Bulgari hotels and resorts and offers views of the Indian Ocean.
 
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<a href="https://www.hotelpetitmoulinparis.com/" target="_blank">Hotel du Petit Moulin, Paris</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/stories/2012/09/hotelpetit.jpg">
The Hotel du Petit Moulin is another luxury hotel decorated by Christian Lacroix. Comprising of 17 guest rooms, the reception was once the oldest bakery in Paris, and the 1900 façade is a historic monument.
 
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<a href="https://www.claridges.co.uk/" target="_blank">Claridge’s London</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/stories/2012/09/claridges.jpg" width="470">
Claridge’s London is an iconic five-star hotel in Mayfair and was American fashion designer Diane Von Furstenberg’s first interior design project. The elegant hotel has long-standing connections with royalty and is sometimes referred to as an extension of Buckingham Palace.
 
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<a href="https://www.icastelli.net/location-698-1-castello_di_montegridolfo_hotel_palazzo_viviani" target="_blank">Palazzo Viviani at Castello di Montegridolfo, Italy</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/stories/2012/09/vivani.jpg" width="470">
Italian fashion designer and dressmaker Alberta Ferretti renovated a 13th-century castle into the Palazzo Viviani. Located in the hills of Emilia Romagna and close to Rimini, this luxury hotel is a mix between medieval charm and modern comfort.
 
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<a href="https://uxua.com/" target="_blank">Uxua Casa, Brazil</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/stories/2012/09/uxa.jpg" width="470">
The Uxua Casa is designed and owned by Diesel’s ex creative director, Wilbert Das. Made up of 10 individual guesthouses, the walls are made from mud and branches, nestled among tropical gardens and colourful buildings. Das wanted the interiors to be organic, rustic and sensual.
 
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<a href="https://dubaipropertiesgroup.ae/en/properties/the-tiger-woods-dubai" target="_blank">Elie Saab Hotel at The Tiger Woods, Dubai</a>
<img src="https://www.urban.com.au/images/stories/2012/09/woods.png" width="470">
Lebanese fashion designer Elie Saab designed the luxury hotel that overlooks the world’s first Tiger Woods-designed golf course. The luxury boutique hotel includes 89 suites and 14 bungalows and showcases a 929-square-metre swimming pool.
 
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<a href="https://www.schlosshotelberlin.com/" target="_blank">Schlosshotel im Grunewald</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/stories/2012/12/schloss.jpg">
Set in the Grunewald gardens and built by Kaiser Wilhelm II, the 53-room hotel received a modern facelift by German fashion designer, artist and photographer Karl Lagerfield. The hotel includes Turkish baths and a Vivaldi restaurant surrounded by high, gold-painted ceilings.
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As Palazzo Versace sells, check out 15 global flashy fashion-branded hotels

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In its most simplistic form, negative gearing for investment housing allows investors to deduct their losses against their personal taxable income.  These losses may occur when the investor incurs costs such as interest on a home loan as well as maintenance and other small expenses on an investment property. However, it is important to note that negative gearing is not unique to the property asset class; it also applies to businesses and shares in Australia.
The most important thing to realise about asset negative gearing is that it is fundamentally offsetting a loss.  Although you can claim that loss on your tax return, the investor must carry the cost of that loss throughout the year.  Ultimately, when investing, most purchasers would be hoping that rental rates increase over time and result in the asset moving from a loss-making one to an income-producing one.
It is also important to note that between September 1985 and September 1987, negative gearing laws were changed.  The government quarantined negative gearing interest expenses on new transactions.  As a result, investors could only claim interest expenses against rental income, not other income.
Given that negative gearing provides a benefit to investors, we look at the impact these changes had on the investment market over the two-year period.  The first component is the impact the changes had on the rental market.
According to the rental component of CPI data, rents across the capital cities rose by 21.8% over the two years to September 1987 (the period during which negative gearing laws were changed).  The increase in rents was most pronounced over the period in Sydney (26.1%) and Perth (31.1%).  As a comparison, over the two years to September 1985, rental costs rose by a lower 17%.
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The data clearly shows that rental growth was present over this period and it was greater than it was over the two-year period directly preceding it (The above chart shows the period for which the negative gearing rules were changed and are bolded black).  Here you can see that rental growth was well above average, particularly recent averages, but it was not unprecedented, with rents growing by a greater amount on an annual basis in late 1982 and early 1983.
Another important determining factor is the demand from investors over this period.  Unfortunately the Australian Bureau of Statistics does not provide information on the number of loans to investors; rather it provides the total value.  The total value of investment finance commitments in September 1987 was 41.5% higher than in September 1985.  These figures seem to suggest that at that time there was no weakness in demand for investment housing, however, a clearer outcome would be apparent based on the number of loans rather than the value.
The reason why negative gearing was reinstated in September 1987 was that it was proclaimed that rents rose sharply on the back of a fall in housing market investment.  However, it doesn’t look as if investment in the housing market dried up throughout this period. Rents clearly did rise quite sharply throughout, as demonstrated.


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Many in favour of removing negative gearing from property say that it should occur due to the fact that housing is an unproductive asset class.
My argument is that given that housing provides shelter, if investors don’t purchase these assets, it would then be the responsibility of the government to provide this shelter.  Ultimately, that would mean that anyone that pays taxes would be funding housing for those who can’t afford it themselves.
One of the arguments against negative gearing is that the tax deductions afforded to investors in the housing market reduces government revenue.  However, if investors did not provide shelter to those who can’t provide it to themselves, government revenue would already be reduced due to the fact that this responsibility would fall on the government.
If we look at the recent Australian Bureau of Statistics (ABS) dwelling approvals data, it is interesting to see just how much of the new housing supply is created by the private sector as opposed to the public (government) sector.  According to the ABS dwelling approvals series, which began in July 1983, between July 1983 and October 2012, 4,355,266 dwelling approvals have been given to the private sector compared to just 228,843 to the public sector.  Over the last 29 years (give or take a few months), public housing approvals have accounted for just 5% of all dwelling approvals.  This is less than 8,000 approvals by the public sector each year!
Over the 12 months to October 2012, 145,515 dwellings approvals were granted to the private sector (98.6%) compared with just 2,065 to the public sector (1.4%).
The most recent census data shows us that of those homes occupied, 29.6% are rented (investment properties).  Based on this data, if we assume that without the private sector building homes for investment purposes, the public sector would have to account for 29.6% of all dwelling approvals to cover those in rental accommodation.  Over the past 12 months this would have equated to 43,684 dwelling approvals.  If we also consider that the median home price across Australia as at October 2012 was $386,000, and if the government had to buy the land and build 43,684 homes, this would cost the Government of the day $16,861,900,480 based on the number of approvals and the median home price.
Of course this is a rather simplistic calculation and if the government were to build homes on its own land it would cost less, as that figure includes land and building.  Also, it is unlikely that private investment in residential housing would cease without negative gearing but I would expect that it would fall.
The most recent taxation statistics data shows that over the 2009-10 financial year, $4.81 billion in net rental deductions were claimed by taxpayers.
<img src="/images/stories/2012/12/rpdec172.gif" width="470" height="185" alt="rpdec172">
In order for the government to break even to allowable deductibles from tax returns they would have to be building those 43,684 homes at a cost of $110,100.  Based on the current median home price across the country at $386,000, they would have only been able to build 12,461 homes over the past 12 months or 8.4% of the total building approvals over the past year.  It should be noted that not all new builds are for investment purposes but if we assume that 29.6% are there is a significant shortfall.
When you look at these figures it is obvious why negative gearing is unlikely to be removed.  Whether the removal of negative gearing impacted investment or not, and whether it lead to an increase in rents is a secondary concern relative to how much it would cost the government to supply public housing for the almost 30% of Australians that don’t own their own home.
These figures are not to suggest that if in the case negative gearing was removed, there would be no investors in the market however, the appeal of negative gearing is part of what attracts many investors to the market.  Without negative gearing it is likely that there would be fewer investors and therefore less private developers delivering new homes coupled with a greater need for the public sector to provide housing.  The flow on effect may also be that there would likely be lower demand for housing credit.  Although some proclaim removing negative gearing would cause house prices to fall, I would expect that new housing supply would be even tighter as developer’s struggle to achieve pre-sales for new development, this may in-turn force prices higher than they otherwise would be.
By looking into the figures in more detail, it makes good economic sense for the government to allow housing investors to negatively gear their properties so that the significantly greater cost of providing social housing is not borne by the Government and ultimately the Australian taxpayer.
Cameron Kusher is senior research analyst at <a target="_blank" href="https://www.myrp.com.au">RP Data</a>.
 
 
 
 
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ckusher-ujnxiKuFQs

Negative gearing for property investors makes good economic sense: Cameron Kusher

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The REIV has released its rental data for November, and it shows the vacancy rate for Victoria has increased from 1.9% to 2%, with Melbourne’s increasing from 1.9% to 2.2% and a mild tightening in regional Victoria from 2 to 1.8%.
While this is an improvement for those looking to rent a home, higher vacancy rates can reduce the returns for the tens of thousands who own and rent out investment properties.
There was a minor variation in the median rent charged for houses in Melbourne, with an increase of $10 per week to $380. The median rent for units was stable at $350 per week.
The level of vacancies in Melbourne is relatively even across the city. A vacancy rate of between 2 and 2.2% was found across the city. When compared with previous months there was a substantial tightening of the vacancy rate in the inner city, where it fell from 2.6% in October to 2.2%. This shows that the new apartments being purchased by investors are slowing being absorbed into the market.
In contrast the vacancy rate in the outer suburbs nearly doubled from 1.1% to 2%. This easing has not yet been apparent in rents being charged as they remained stable.
Within regional Victoria the vacancy rate tightened in Geelong from 2.8% to 2.1%, was stable in Ballarat at 1.5% and eased slightly in Bendigo from 0.7% to 1%.
The overall rental market is well balanced at the moment, and it is unlikely that there will be any substantial increases in overall rents charged while the vacancy rate remains between 2% and 3%.
Enzo Raimondo is CEO of the <a rel="nofollow" target="_blank" href="https://www.reiv.com.au/">Real Estate Institute of Victoria</a>.
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enzoraimond-7fvRFHPR52

Inner-Melbourne vacancy rate tightens substantially in November

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I’m expecting a more buoyant market in both Sydney and Brisbane in 2013, especially with the latest official interest rate cut taking rates to the historical low benchmark of 3%. This is the same interest rate as during the GFC, and many in the financial markets predict more to come next year.

Interest rates have a profound effect on property markets, although the impact of a collective 1.25-percentage-point cut in official rates this year has been tempered by the banks not passing them on in full.

As the holidays draw near, I suggest spending some of your spare time considering how you can leverage current market conditions to build wealth for the future. I feel we’re in the final stages of a buyers’ market and prices are only going to rise (not dramatically, but in a reasonable fashion) from here.

With home loan rates, especially fixed rates, in the low 5% bracket, you don’t need a sky-high yield to make your next investment property pretty much pay for itself. There’s also the opportunity to upgrade your home at a time when the higher up you go on the price scale, the better the savings.

It’s worth noting, however, that falling interest rates indicate a flat economy. Generally speaking, retail spending is down as more people focus on saving and reducing debt. Plus, we have a very high dollar and the global economic outlook is still of concern. Overall though, Australia is still strong.

If you’re worried about the economy, have a read of the latest monetary policy decision on the Reserve Bank’s website at <a href="https://www.rba.gov.au" target="_blank">www.rba.gov.au</a>. It should put your mind at ease as it clearly explains why the RBA is cutting rates – and it’s certainly not because the economy is falling into a hole!

If you’re personally in a good financial position with a secure job, then don’t let the economy hold you back from buying property. 

The latest RP Data-Rismark survey shows property values in Sydney and Brisbane are up 0.6% and 0.8% for September-November. Year-on-year, they’re up 1.3% and 0.3% respectively.
These are small gains, but they represent a change in the market. On a national level, capital city prices are still -5.6% off their historical peak in November 2010 but they’re up 2% from their historical low in May this year – indicating we’ve left the bottom of this particular property cycle.

During September-November, weekend clearance rates in Sydney remained above 60% for nine consecutive weeks. This is a significant development. After breaking down McGrath’s clearance rates for the last four Saturdays in Sydney, it becomes clear that the under-$750,000 market is still strongest, with our company averaging a 69% clearance rate in this bracket, followed by 65% for the $750,000 to $1.5 million sector.
 
<hr class="system-pagebreak">
 
Australia’s largest mortgage broker, AFG, reports November as the biggest month for new loans all year. In its latest report released this month, 7,831 new loans were sold in November – almost 1,000 more than in the first month of the spring selling season (September). For a long time now, people have been sitting on the sidelines watching what happens. I think more people are coming off the bench now as interest rates become too good to resist.

In NSW, 41% of new loans in November went to investors, and 33% in Queensland. Among today’s investors are many people using self-managed super funds to buy residential real estate. This has been a strong trend, particularly in Sydney, in 2012 and it will only continue as more people get comfortable with the relatively new idea of managing their own super.

Investors won’t have much competition from first home buyers in NSW and Queensland in 2013 following the abolition of government incentives. In November, AFG arranged 96 home loans for first timers in Queensland, compared with 265 in October. In NSW, AFG organised 219 home loans in September for first-home buyers but in October and November combined, this number dropped by more than half.

Looking ahead, there is no doubt the Brisbane property market is well positioned for a new cycle of growth. More than a quarter of Australia’s population growth over the next 25 years is expected to be in the region from <a target="_blank" href="/news">Noosa </a>to <a target="_blank" href="/news">Coolangatta</a>, which will push Brisbane ahead of Melbourne as the country’s second biggest city. If supply remains below demand, this sort of population growth will have a big impact on property prices.

Sydney remains the BHP of Australian real estate – the big blue-chip market that generally outperforms the rest, particularly in the recovery period of a national market cycle. In 2013, I’m predicting a 2 to 5% price rise in the under-$750,000 market and a 5 to 8% rise in the $750,000 to $1.5 million bracket. I also think rents will continue their northward march, probably by 4 to 5%.
John McGrath is CEO of <a target="_blank" href="https://www.mcgrath.com.au/">McGrath Estate Agents</a>.
This article originally appeared on <a target="_blank" href="https://blog.mcgrath.com.au/">John McGrath's blog.</a>
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jmcgrath-6XcGQCVx3d

The end of the buyers' market drawing near, with Australian property prices set to rise in 2013

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The ANZ Banking Group has followed its big bank rivals and lowered its standard variable home loan rates by 0.2 percentage points.
The bank announced today (Friday) that it would lower its standard variable home loan rates effective December 21, 2012.
The bank makes its rate decision on the second Friday of the month.
ANZ’s new standard variable mortgage rate will be 6.4%pa (6.5%pa comparison rate) with the 0.2-percentage-point reduction to save variable mortgage customers about $10 per week for the average home loan of $250,000.
The Reserve Bank of Australia cut the official cash rate by 0.25 percentage points on December 4.
It has been estimated the big banks pocket more than $6 million profit every day they don't pass on the full 25-point rate cut to home borrowers.
“This month we assessed a wide range of factors in reaching our decision including the impact of the lower cash rate on domestic funding sources, continuing competition for deposits, the international funding environment and our competitive position,” ANZ chief executive Australia Philip Chronican said.
“We believe the decision to lower our variable mortgage rate by 0.20 percentage points is the right one for our customers providing a competitive mortgage rate while also recognising the significant uncertainty associated with the fiscal situation in the United States and the political situation in Europe.”
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jchancellor-FAypfDUnLy

ANZ falls into line with 20bps cut, but takes the profit

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The South Henley Beach house that inadvertently featured a backyard photograph showing alleged <a href="https://www.propertyobserver.com.au/south-australia/pot-plants-in-real-estate-ads-bring-adelaide-police-to-the-open-for-inspection/2012121358447?utm_source=po&amp;utm_medium=aida&amp;utm_campaign=news">potted marijuana plants </a>will go to forthcoming auction with expectations of around $550,000.
<img width="470" src="/images/stories/2012/12/potplant.jpg">
The two-bedroom brick house is just a few blocks away from beach in the sought-after western Adelaide suburb about 15 minutes from the CBD.
<img width="470" src="/images/stories/2012/12/military.jpg">
RP Data records show it last sold for $130,000 in 1993.
The original listing featured a photo of the backyard showing two pot plants with alleged flowering marijuana plants, prompting a surprise police inspection, seizure of the plants and a court date for one of the occupants.
The property is being marketed by Arthur Dimitrak from Harcourts Mile End, who told Property Observer he felt sorry for the accused young occupant.
“He should have put his plants in the shed.”
<img src="/images/stories/2012/12/military2.jpg">
Dimitrak expects that whoever buys it will knock it down and either builds a new house or sub-divide and put up townhouses.
“It’s an expensive suburb, close to cafes …very sought after,” he says.
Dimitrak says he has had a lot of interest in the property since its November 23 listing, but said interest is mainly in the land, with the house standing on a 936-square-metre block.
According to the listing marketing, there's $320 per week ongoing rental potential.
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Adelaide Henley Beach joint to go to auction – but alleged marijuana pot plants nipped in the bud

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Strata office space in the Melbourne CBD is being acquired by small businesses as their business premises for as little as $95,000, according to property services group DTZ.
DTZ strata agents Craig Hembrow and Danny Clark has sold 12 strata offices in the last few weeks totalling $2.7 million, with sales occurring in buildings on Little Collins Street, Collins Street and Queen Street.
Buyers include professional businesses, consultancies and small businesses in the medical, accounting, financial or business support services.
“These transactions have considerably tightened the market in properties in the sub 200 square metre range, to the point that some buyers are giving up due to frustration over a lack of available market stock” says Clark.
“This is partly attributable to a convergence of buyer and vendor expectations”.
Popular buildings for strata office purchases include 343 Little Collins Street on the Elizabeth Street corner, the Art Deco Manchester Unity building at 220 Collins Street on the Swanston Street corner and the modern 2 Queen Street building on the Flinders Street corner.
According to DTZ, limited supply is available in the prime East End of the CBD which is generally attractive to medical, corporate consulting, and financial services businesses.
Recent sales include a 32-square-metre office at 343 Collins Street, which sold for $95,000 – a rate of $2,981 per square metre rising up to $376,000 for a 63-square-metre strata office at 2 Queen Street.
Strata office sales 
<div style="text-align: left;" align="center">
<table style="width: 470px;" border="0" cellspacing="0" cellpadding="0">
<thead><tr>
<td style="text-align: left;" width="180">
Address
</td>
<td style="text-align: left;" width="85">
Sale Price
</td>
<td style="text-align: left;" width="85">
Area (sq.m.)
</td>
<td style="text-align: left;" width="57">
Rate per m2
</td>
<td style="text-align: left;" width="221">
Sales Transaction
</td>
</tr></thead>
<tbody>
<tr>
<td style="text-align: left;" width="180" valign="top">
204/220 Collins Street
</td>
<td style="text-align: left;" width="85" valign="top">
$309,570
</td>
<td style="text-align: left;" width="85" valign="top">
60
</td>
<td style="text-align: left;" width="57" valign="top">
$5,159
</td>
<td style="text-align: left;" width="221" valign="top">
Investment returning 6.91% return
</td>
</tr>
<tr>
<td style="text-align: left;" width="180" valign="top">
303/343 Little Collins Street
</td>
<td style="text-align: left;" width="85" valign="top">
$110,000
</td>
<td style="text-align: left;" width="85" valign="top">
35
</td>
<td style="text-align: left;" width="57" valign="top">
$3,142
</td>
<td style="text-align: left;" width="221" valign="top">
Vacant possession
</td>
</tr>
<tr>
<td style="text-align: left;" width="180" valign="top">
408/343 Little Collins Street
</td>
<td style="text-align: left;" width="85" valign="top">
$125,000
</td>
<td style="text-align: left;" width="85" valign="top">
39
</td>
<td style="text-align: left;" width="57" valign="top">
$3,205
</td>
<td style="text-align: left;" width="221" valign="top">
Vacant possession
</td>
</tr>
<tr>
<td style="text-align: left;" width="180" valign="top">
409/343 Little Collins Street
</td>
<td style="text-align: left;" width="85" valign="top">
$126,000
</td>
<td style="text-align: left;" width="85" valign="top">
39
</td>
<td style="text-align: left;" width="57" valign="top">
$3,230
</td>
<td style="text-align: left;" width="221" valign="top">
Vacant possession
</td>
</tr>
<tr>
<td style="text-align: left;" width="180" valign="top">
702/343 Little Collins Street
</td>
<td style="text-align: left;" width="85" valign="top">
$95,400
</td>
<td style="text-align: left;" width="85" valign="top">
32
</td>
<td style="text-align: left;" width="57" valign="top">
$2,981
</td>
<td style="text-align: left;" width="221" valign="top">
Vacant possession
</td>
</tr>
<tr>
<td style="text-align: left;" width="180" valign="top">
709/343 Little Collins Street
</td>
<td style="text-align: left;" width="85" valign="top">
$285,000
</td>
<td style="text-align: left;" width="85" valign="top">
82
</td>
<td style="text-align: left;" width="57" valign="top">
$3,476
</td>
<td style="text-align: left;" width="221" valign="top">
Vacant possession
</td>
</tr>
<tr>
<td style="text-align: left;" width="180" valign="top">
207/2 Queen Street
</td>
<td style="text-align: left;" width="85" valign="top">
$376,000
</td>
<td style="text-align: left;" width="85" valign="top">
63
</td>
<td style="text-align: left;" width="57" valign="top">
$5,968
</td>
<td style="text-align: left;" width="221" valign="top">
Investment returning 7.71%
</td>
</tr>
<tr>
<td style="text-align: left;" width="180" valign="top">
1111/227 Collins Street
</td>
<td style="text-align: left;" width="85" valign="top">
$230,000
</td>
<td style="text-align: left;" width="85" valign="top">
46
</td>
<td style="text-align: left;" width="57" valign="top">
$5,000
</td>
<td style="text-align: left;" width="221" valign="top">
Vacant possession
</td>
</tr>
<tr>
<td style="text-align: left;" width="180" valign="top">
208/430 Little Collins Street
</td>
<td style="text-align: left;" width="85" valign="top">
$255,000
</td>
<td style="text-align: left;" width="85" valign="top">
39
</td>
<td style="text-align: left;" width="57" valign="top">
$6,538
</td>
<td style="text-align: left;" width="221" valign="top">
Vacant possession
</td>
</tr>
<tr>
<td style="text-align: left;" width="180" valign="top">
405/220 Collins Street
</td>
<td style="text-align: left;" width="85" valign="top">
$275,000
</td>
<td style="text-align: left;" width="85" valign="top">
27
</td>
<td style="text-align: left;" width="57" valign="top">
$10,185
</td>
<td style="text-align: left;" width="221" valign="top">
Vacant possession
</td>
</tr>
<tr>
<td style="text-align: left;" width="180" valign="top">
101/2 Queen Street
</td>
<td style="text-align: left;" width="85" valign="top">
$303,000
</td>
<td style="text-align: left;" width="85" valign="top">
49
</td>
<td style="text-align: left;" width="57" valign="top">
$6,183
</td>
<td style="text-align: left;" width="221" valign="top">
Vacant possession
</td>
</tr>
<tr>
<td style="text-align: left;" width="180" valign="top">
102/2 Queen Street
</td>
<td style="text-align: left;" width="85" valign="top">
$217,000
</td>
<td style="text-align: left;" width="85" valign="top">
35
</td>
<td style="text-align: left;" width="57" valign="top">
$6,200
</td>
<td style="text-align: left;" width="221" valign="top">
Vacant possession
</td>
</tr>
</tbody>
</table>
</div>
 Source: DTZ
In August, Savills research confirmed private investors were the most active purchaser category in the strata office market in the prior 12 months, having purchased 42 properties worth a total of more than $26 million.
The recent Urbis Melbourne strata office market report calculated that there are some 1,800 strata units within the Melbourne CBD, with an average sales turnover approaching 130 units per annum – this represents 7% per cent of total stock.
The report notes that prior to 2000, the market was characterised by the creation of strata units from the conversion of older, conventional office buildings, with few purpose built facilities.
However, since 2000, some 500 strata units have been supplied, all in purpose built facilities, with most in the Docklands precinct.
These include Aquavista at 401 Docklands Drive, Docklands (205 units, built 2007) and Site One at 757 Bourke Street, Docklands (53 office units, built 2007).
Strata developments currently under construction include Lifestyle Working Collins Street, at 838 Collins Street featuring 137 units and 35 Exhibition Street, featuring approximately 40 units, both of which are due for completion in 2013.
According to the Urbis report, yields for prime strata office suites are currently in the range of 6.5% to 7%, with secondary yields generally in the range of 7.0% to 8.0%, on net rents.
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