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 combined capital city auction clearance rate increased from 52.8% to 56.2% last week. Over the week, there were 1,555 auctions held across the capital cities, which is comparable to volumes recorded over the previous week. At the same time last year, auction volumes were up with just under 1,700 auctions held across the capitals, however, the clearance rate was recorded at a much lower 44.9 per cent.
In Melbourne, Australia’s largest auction market, the clearance rate increased to 60.8% last week, from 55.5% the week prior. There were 726 auctions scheduled over the week. Next week, there are 1,207 auctions scheduled across Melbourne. In Sydney, auction clearance rates increased from 57.6%the week prior to 60.3% last week.
Across the capital cities, there are 2,353 auctions scheduled for the coming week, which will be one of the busiest auction weekends seen this year.
Click to enlarge
<a rel="shadowbox" href="/images/stories/2012/10/rpoct23.gif" title="Click to enlarge"><img src="/images/stories/2012/10/rpoct23thumb.gif"></a>
Source: <a target="_blank" href="https://www.myrp.com.au/">RP Data</a>
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Melbourne and Sydney gear up for one of the busiest auction weekends of the year: RP Data

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There’s more money to be made selling home loans than flipping hamburgers, it seems.
Australian Financial Review columnists Christopher Joye has tweeted that the Commonwealth Bank, now has a greater market capitalisation than global brands like American Express and McDonald's, with the four major banks valued at a collective $300 billion.
<a href="https://twitter.com/cjoye" target="_blank"><img src="/images/stories/2012/10/joyetweet3.jpg"></a>
However, Joye believes Australian financial system would be safer and more stable with “eight medium-sized banks, which were individually non-essential to the overall economy, than the four too-big-to-fail behemoths we have today”.
Writing in the AFR today, Joye says the “majors’ too-big-to-fail features bequeath tremendous comparative advantages”.
“In banking, he with the lowest cost of funding wins via higher profits, greater market share, or both.
“Standard &amp; Poor’s lifts the majors’ credit ratings two notches higher purely because it believes taxpayers will bail them out during a crisis. No other Australian deposit-taker gets this rating relief.”
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Commonwealth Bank more valuable than McDonald's and American Express: Tweet of the day

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Talk is cheap because supply exceeds demand.
The cheapest talk comes from economists speaking about real estate, because supply (endless) is hugely in excess of demand (zero). There’s also a low price on the articles of most journalists about property because the demand is for a David Jones product but most of the supply is coming from Gone Bonkers. 
So, after two years of price decline or stagnation in our major cities, at the first sign of price recovery they’re out there talking up a bubble. 
Yes siree, if you crave a bit of media limelight the shortest route is to contact a lazy journalist and give them a sound byte with the word “bubble” in it. 
Data from the various research sources indicates we’ve had three or four months in which the average result across the state and territory capital cities has been a rise in median prices. 
I’m not sure how reliable the data is, because organisations like RP Data are so desperate to be first with the news that they’ve been calling the monthly price movement on the last day of the month, something that’s difficult to do credibly. Indeed, this week RP Data declared the October price movement 10 days before the end of the month. Is the need for publicity really that desperate? 
Nevertheless, the trend evident in the figures from various research sources is one of big-city prices now starting to trend north, slowly. 
Further to that, a number of forecasters are predicting rising prices in the near future. BIS Shrapnel is tipping growth in all eight state and territory capitals in the next three years, with the strongest to be in <city>Perth</city>, <city>Brisbane</city>, <city>Sydney</city> and <city><place>Darwin</place></city>, where the rises are expected to be solid but not spectacular. 
National Australia Bank published its survey of Australian property professionals, most of whom are expecting moderate growth in the next 12 months. 
So we appear to have a return to price growth, though small, with the prospect of more moderate rises. 
But there’s no middle ground with media. It’s either boom or bust. Now it seems even the smallest rise in house prices instantly has the label “bubble” slapped on it. Alternatively, a cut in interest rates gives rise to fears of a bubble.
David Uren, who writes about economics for The Australian, recently tried to link fears of a house price boom in <country-region><place>Australia</place></country-region> into an incoherent rave about inflation and global financial instability. Some fairly innocuous remarks by business leaders have been portrayed by journalists as fears about a bubble, when the people quoted never used that terminology. 
Bubble talk has been around for the past five years. It started when a metropolitan newspaper journalist misquoted RBA governor Glenn Stevens and the mistake was repeated as fact by media outlets around the country. Economists and journalists have been promoting bubble talk ever since, although Stevens never said the words reported. It wasn’t merely a beat-up – it was a lie. 
I’m still waiting for someone who subscribes to the bubble theory to actually define it. So far, nobody has. The term implies that something has been over-inflated and will burst. 
Despite all those dire predictions about a collapse in our home prices since 2007, mostly from publicity-seekers based overseas, the forecast implosion hasn’t happened. 
So why are we talking about a bubble now, when capital city prices have barely budged after two years of mediocrity? Because we’re beset with writers and commentators who are shallow, lazy and like the sound of their own voices.
Terry Ryder is the founder of <a target="_blank" rel="nofollow" href="https://www.hotspotting.com.au/">hotspotting.com.au</a> and can be <a target="_blank" rel="nofollow" href="https://www.twitter.com/hotspotting">followed on Twitter</a>.
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We are returning to moderate housing price growth, but no bubble: Terry Ryder

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The Reserve Bank plans to introduce new reporting requirements for lenders that issue residential mortgage-backed securities (RMBS) to investors as the Australian securitisation market show more positive signs of a gradual recovery.
In his address to Australian Securitisation Forum in Sydney yesterday RBA assistant governor Guy Debelle said RMBS issuance in the year to date had totalled $10 billion.
“By way of comparison, in the second quarter of 2007, at its peak, issuance amounted to $25 billion,” he said.
The RMBS market was heavily used by non-bank lenders and other smaller lenders before the GFC to access cheap mortgage funding, with tranches of mortgages securitised and sold to both local and offshore investors.
But the RMBS market froze following the GFC as offshore investors demanded higher returns to compensate for the perceived higher risk, spooked by sub-prime crisis in the US.
Since then the Australian market has been recovering gradually with the help of the Australian Office of Financial Management, which has acted as a cornerstone investor on many transactions to reassure investors.
The graph below, presented by Debelle, shows how the market slumped from annual RMBS issuance of around $40 billion in 2007 to just over $10 billion in 2008, but has risen since then.
<img src="/images/stories/2012/10/rbaoct231.gif">


<hr class="system-pagebreak">
Under the new draft quarterly reporting requirements, the RBA will require that “issuers provide the Reserve Bank and the broader public with more comprehensive and up-to-date information on the securities”.
The new information requirements cover both transaction-related data as well as information on the underlying assets, such as anonymised loan-level data.
Industry comment on the new requirements is been sought by the RBA until December 28, with a <a href="https://www.rba.gov.au/media-releases/2012/mr-12-31">full breakdown of the draft proposal provided on the RBA website</a>.
“When the templates are finalised, an implementation period will apply for RMBS to give issuers the time to develop the reporting systems necessary to comply with the new reporting requirements,” says the RBA.
Commenting on the initiative and the improvement in the market, Debelle said that in Australia, RMBS issuance in 2012 had recovered to the point “where new issues are replacing maturing issues so the stock outstanding is no longer declining”.
“This year we have seen positive signs in the Australian securitised market, particularly over the past several months," he added.
“First, despite the periodic bouts of turmoil in offshore markets, there has been a steady flow of new issues. Primary spreads have gradually tightened this year and a number of deals have been fully placed with external investors (that is, no tranche has been retained by the issuer), including junior tranches.
“More recently, several issues have been completed with little or no support from the AOFM due to strong private investor demand. And, of course, the collateral underlying Australian asset-backed securities (ABS) continues to be of high quality, with arrears rates on Australian mortgages remaining low,” he said.
Debelle said the new information requirements “should not only benefit the Reserve Bank in assessing the quality of the securities provided to it as collateral, but also be of benefit to the market as a whole”.
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RBA to introduce new reporting requirements for residential mortgage-backed securities 

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Super Saturday will demonstrate whether the higher clearance rate this year is a real improvement on last year or simply a result of fewer properties going to auction, says the Real Estate Institute of Victoria.
<iframe src="https://player.vimeo.com/video/51856012" width="400" height="300" frameborder="0" webkitallowfullscreen mozallowfullscreen allowfullscreen></iframe>
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Victorian auction clearance rates holding steady, but super Saturday will be true test: REIV

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It attracts more anticipation than a grand final and a bigger array of stars than the Cup Carnival. And the results are more telling than the Bathurst 500: that’s what super Saturday, October 27th represents to the largest array of buyers and sellers on offer this year.
This coming weekend was always going to be a big weekend for auctions. It’s the only Saturday you could start your four-week auction campaign after the grand final and complete it before the Melbourne Cup.
Who said Melbourne doesn’t revolve around sport?
In the sport of Auctions there are six “majors” each year, and this is the second last major for season 2012. As in golf or tennis, the majors are a culmination of many minor tournaments that occur each weekend beginning mid-February and ending in mid-December.
They are the ones we all remember – the ones that leave us with an indelible indicator as to the state of play of the market, and the likely worth of our property nest egg right now.
The first major happens the fourth weekend after the Australia Day weekend.  This is the key weekend in the short opening season between Australia Day and the Labour Day weekend. The second is the last weekend before Easter, and the third is the fourth Saturday after Easter, usually in mid to late May. Those three majors are the highlights of the opening, pre-Easter and post-Easter mini selling seasons.
There is then a long winter break where not much happens at the higher end, until we hit September and the fourth major happens on the weekend before the grand final. The fifth is coming up this weekend. And the final major is the fourth Saturday after Melbourne Cup, usually the last weekend in November. These are the main pointers to the early and late spring and the pre-Christmas selling seasons.
Why is it such a big deal to keep an eye on what is happening on these super Saturdays?
When you have a good cross-section of stock, with some really good homes all going under the hammer at the same time, it gives an accurate indication of buyer depth and therefore future price and market direction. If Bidderman, the average number of bidders per auction, is up towards two per auction on a super Saturday we can confidently say the market has some health. If clearance rates are down in the lower 50% levels and Bidderman is around one bidder per auction, prices are not looking solid going forward.
For us, this weekend will be a true test of how the market currently seems to be travelling – which to date has actually been OK.
Mal James is principal of<a title="James Buyer Advocates" href="https://www.jamesbuyeradvocates.com.au/" target="_blank"> James Buyer Advocates</a>, which advocates on behalf of buyers of property over $1 million. Mal writes weekly auction reports, advice and in-depth market analysis on James' website. 
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This weekend's super Saturday will be a true test of the Melbourne property market

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The recently polled readers of Property Observer are generally quite optimistic about the spring property outlook.
Almost half (48%) expect house prices to rise over the next year. Some 31% expect no change and 21% expect prices to fall.
While seeking capital growth over rental yield (60% to 40%), they are even more expectant of rising rents, with 61% expecting house rents to rise over the next year.
On the financing front most expect interest rates to continue to fall over the next six months. Some 35% of respondents expect interest rates to fall by 25 basis points in the next six months, followed by 28% who expect them to fall by 50 basis points.
Auctions aren't in favour, with 71% saying the best way to sell presently is by private treaty.
Some 84% suggest its a spring buyers' market.
Property Observer, in association with <a href="https://www.realestateview.com.au/" target="_blank">realestateVIEW.com.au</a>, asked readers to give their best property investment tips. Here's 15 that took our fancy.  
 
The winning tip:
<img src="/images/stories/2012/10/eggs.gif">
- Elise in Perth
 
Runners-up (in no particular order) on following pages
<hr class="system-pagebreak">
 
The runners-up (in no particular order):
<img src="/images/stories/2012/10/renter.gif">
- Fiona in Sydney
 
<hr class="system-pagebreak">
 
<img src="/images/stories/2012/10/researched.gif">
- Sarah in Melbourne
 
<hr class="system-pagebreak">
 
<img src="/images/stories/2012/10/hungry.gif">
- Rhys in Sydney
 
<hr class="system-pagebreak">
 
<img src="/images/stories/2012/10/fringes.gif">
- Susan in Melbourne
 
<hr class="system-pagebreak">
 
<img src="/images/stories/2012/10/fringes2.gif">
- Nathan in Sydney
 
<hr class="system-pagebreak">
<img src="/images/stories/2012/10/pops.gif">
- Minh in Melbourne
 
<hr class="system-pagebreak">
<img src="/images/stories/2012/10/athome.gif">
- Cedric in Melbourne
 
<hr class="system-pagebreak">
<img src="/images/stories/2012/10/intui.gif">
- Paolo in Brisbane
 
<hr class="system-pagebreak">
<img src="/images/stories/2012/10/millionaire2.gif">
- Pece in Melbourne
 
<hr class="system-pagebreak">
<img src="/images/stories/2012/10/booming.gif">
- Kath in Adelaide
 
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<img src="/images/stories/2012/10/weekly.gif">
- Glenn in Melbourne
 
<hr class="system-pagebreak">
<img src="/images/stories/2012/10/diligence.gif">
- Andrew in Sydney
 
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<img src="/images/stories/2012/10/subd.gif">
- Adam in Melbourne
 
<hr class="system-pagebreak">
 
<img src="/images/stories/2012/10/infra.gif">
- Sandro in Adelaide
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The 15 best investment tips from our Spring Property Outlook Survey

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Two current auction listings in Sydney’s inner east are amongst the smallest for their suburbs.
Agents are selling a 45-square-metre house in Paddington and a Darlinghurst house on about 40 square metres.
The smallest Sydney house that Property Observer is aware of is in Rozelle.
A tiny six-metre-wide terrace in Paddington has been listed for sale at more than half a million dollars.
The 45-square-metre property at <a target="_blank" href="https://www.realestate.com.au/property-house-nsw-paddington-111902647">4 Mary Place</a> (pictured below) maximises space with a charming rustic rooftop entertaining terrace.
<img src="/images/stories/2012/10/mary.jpg">
It has been listed through BresicWhitney agents William Phillips and Maclay Longhurst with $525,000-plus hopes for its November 17 auction.
<img width="470" src="/images/stories/2012/10/mary2.jpg">
Potential buyers enter the property through its Mary Place entry into the open-plan living and dining room. One door leads into the galley-style kitchen while the other leads into a 3.2-metre by 2.4-metre bedroom and an ensuite. A hatch leads onto the rooftop storage and entertaining area.
Marketing for the property describes it as a “sundrenched” look with weathered timber floors.
Property Observer understands the house belongs to Full Square architect Dodie McMenamin.
McMenamin bought the property in 2006 for $410,000 after it was listed for two months at $435,000. Prior to that it sold for $390,000 in 2005.
The property is close to Glenmore Road and Oxford Street.
Also listed by BresicWhitney is a cosy house on about 40 square metres in Darlinghurst.
The property at <a target="_blank" href="https://www.bresicwhitney.com.au/real-estate/id/property/10066/darlinghurst/3-sims-street/#top">3 Sims Street, Darlinghurst</a> (pictured below) is listed by agents Dominic Kuneman and Brigitte Blackman for $675,000.
<img src="/images/stories/2012/10/sims.jpg">
It has a total interior area of around 60 square metres.
<img src="/images/stories/2012/10/sims2.jpg">The two-storey home comes with a tiny courtyard decorated with a wall garden of dangling plants.
It comes with a mix of polished timber floors and tiles throughout and a gas fireplace in the loungeroom.
Potential buyers enter into the living room via Sims Street. A door at the back leads onto the dining room and kitchen, which opens out to the small courtyard at the back. A staircase in the living room leads up to the two bedrooms and one bathroom on the upper floor.
According to RP Data, it last sold in 1996 for $225,000.
Sydney’s smallest home is believed to be at <a target="_blank" href="https://goo.gl/maps/Bi4Z3">180A Evans Street, Rozelle</a> (pictured below), on 27 square metres built in a former alleyway.
<img src="/images/stories/2012/10/small.jpg">It’s pictured on Google Streetview with what looks like a Red Aston Martin with a parking ticket on it.
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Pocket-sized Paddington and Darlinghurst property listings among Sydney's smallest houses

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While a drop in interest rates is promoted widely as being good news for the housing market, with Wayne Swan bouncing around as if he’s a personal Jiminy Cricket sitting on the shoulders of the board during RBA’s monthly meetings, the bleak reality remains that for savers, many of whom are would-be first-home buyers, the news is not good at all.
Since the beginning of May, cuts of between 65 and 75 basis points have been chopped from the big four’s base rates for online saving accounts, and for many renters balancing work, rental payments and other such necessities, the savings account is perhaps the only area capturing the crumbs in which to advance to ownership.
For property shoppers, it may seem a welcome relief to secure a little more purchasing power – except of course every other property buyer in the market place also benefits.  The resulting increased competition that predictably eventuates in upward pressure on median prices is of no benefit to buyers – only to vendors, who, if keeping up with previous repayments, watch their loans diminish faster and equity appreciate.
Investors fare a little better – they usually fix rates on interest-only terms, which at present are extremely favourable, sitting between 5.29% and 5.69% for two- to five-year terms. Therefore, the recent increase in yields and subsequent tightening of vacancy rates, coupled with the low cost of borrowing and numerous tax incentives, complements a portfolio nicely, making long-term investment in bricks and mortar ever more tempting.
So far, we’ve not seen any significant uplift in sentiment to signify a call to arms from property investors. A further reduction in the value of investment loans – which for the month of August dropped 0.8%(ABS) – also doesn’t indicate sentiment in this sector is improving – although it’s yet to be seen if more positive data emerges after the latest RBA cut in rates.
At the very least, the perception of low rates coupled with the fact that housing affordability is judged to be at its most favourable level since 2003 will force growth in some sectors of the market. The recent release from RP Data citing a national rise of close to 2% over the September quarter in median prices (the strongest quarterly increase since 2010) seems to underline this.
The RBA is all too conscious of the housing bubble risks so often associated with a low interest rate environment. Deputy governor Phillip Lowe said the central bank would be watching “very carefully” for resulting signs.  However, the Treasury have not been so prudish in its commentary, stating boldly it “<a href="https://www.afr.com/p/national/housing_to_the_rescue_as_boom_ends_xuljjEShgcOWBe9C8g70kJ">expects recent interest rate cuts, and the possibility of more, to kick-start the second housing boom in a decade</a>,” It would – Treasury says – be “a natural and desirable development” compensating for any future downturn in the commodity sector.
However, one direct consequence of the previous boom, which locked increasing numbers outside of the housing market, was a national rise of 49.2% in yields over the five-year period to 2011 – outpacing growth in home loan repayments for the same period.  Clearly for the vulnerable homeless sector of our community, another housing boom would not be viewed as both “natural and desirable”.
Recent data from Australian Property Monitors places the median rent for a house in <city>Sydney</city> at $520 a week (a record for the city) – and in <place>Darwin</place> at a lofty $700 per week. And, while property investors look set to reap the benefits, we have a growing rental affordability crisis on our hands.  It’s no wonder crowded houses – with three or more families sharing accommodation – rose nationally by 64% to 48,499 over the past five years.
News this past week that new home construction across the country has hit a 10-year low has inspired state governments to once again busy their hands devising new grants and incentives for the purchase of new property – principally aimed at the first-home buyer sector.
However, you only need glance back at the historical lessons associated with the first-home buyer grants to assess re-introduction, with no analysis of the underlying issues that deter buyers from purchasing new accommodation in grant-free environments, is poor short-term policy.
 
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Following the recent period of inevitable and painful house price correction resulting from the decade-long unsustainable boom, the 2008-09vendors who rushed to purchase using the last round of incentives are still sitting on a pot of <a href="https://www.theaustralian.com.au/news/houses-worth-less-than-loans-on-them/story-e6frg6n6-1226497332060">negative equity</a>.   The “retail sale” mentality that goes hand in hand with rate cuts and generous first-home buyer grants is easily offset by the hangover eventuating from the realisation that any savings were simply added onto the property’s purchase price and therefore, in retrospect, were not as much as perceived when purchased.
Meanwhile back in the camp of our renters and would-be home buyers, not only do they have to battle against the prospect of inevitable rising prices, also hampering any ability to save is the stark reality that Australia’s inching its way up in the “cost of living” ranks, which further compromises any perceived benefit from rate dropping affordability.
A recent survey by Mercer – an organisation claiming to “help clients around the world advance the health, wealth and performance of their most vital asset – their people” – paints a rather worrying outlook for struggling savers.
The index, entitled “Worldwide cost of Living Survey”, covers 214 cities across five continents measuring the comparative cost 200 items including “transport, food, clothing, entertainment” and of course, housing.
Australian cities rank high on the list, with Sydney moving from number 14 in 2011 to number 11 in 2012 and Melbourne moving from number 21 in 2011 to 15 in 2012.  The full breakdown can be viewed here – with the results making a trip to <city>London</city> look comparatively affordable. No matter what wealth bracket you sit within, I doubt anyone would deny <country-region>Australia</country-region> is an expensive place to reside.
Other data highlights the stress low-income families experience while meeting essential needs, and housing is the main contributor.  The Australian Council of Social Service recently released a national report making the bold and astounding call that one in eight people now live in relative poverty.
The analysis of the term “poverty” is defined as those having disposable income of less than half that of the median household (the accepted international definition). This would equal a disposable income of less than $358 per week for a single adult and $752 per week for a couple with two children.
The term poverty is an emotionally fuelled word – it brings up images of third world hunger and refugee camps – conditions we don’t experience here. In addition, a report that suggests such a high proportion of Australian’s live in relative poverty is a poor assessment, as no matter how wealthy <country-region>Australia</country-region> grows, there will always be “relative” poverty.
However, I would challenge anyone to find appropriate accommodation within <country-region>Australia</country-region> for a single-or dual-income family on the income levels cited above. As much as we celebrate the resilience of our housing market with the various economic and employment offshoots, the widening gap between the supply of appropriately located affordable accommodation suited to those in – or just above – the poverty line is huge and shameful.
Private investment does not narrow the gap.  Australian property investors are not in the business of targeting property that can be rented on a dime.  They want quality tenants, market yields and increasing equity. The NRAS (National Rental Affordability Scheme), which was designed to go some way in bridging the affordability gap for low-income workers sitting on the rental ladder, is also flawed in its design.
The scheme targets institutions willing to fund a large supply of residential accommodation available for rent at 20% below current market rates.  The tax benefits offered over a 10-year duration are designed to buffer the short fall in yield.   However, the system is easily manipulated.
Many of the homes set aside for NRAS investors are new properties in outer-suburban zones lacking in facilities and home buyer desirability. Even with a reduction of 20% the rental rates are no cheaper than that of an older home in a similar location.  This is because the rents are assessed 20%below “market rates”, which are always somewhat inflated when dealing with property not previously occupied.
When the scheme was first initiated in 2010, the AHURI (Australian Housing and Urban Research Institute) analysed the project to assess the overall impact in easing affordability. The findings revealed only 40%of applicants using the accommodation had fallen below the 30% “housing stress benchmark”. Claims have also come to light suggesting the scheme is being used by developers and selling agents to take advantage of <a href="https://www.heraldsun.com.au/news/national/national-rental-affordability-scheme-tainted-by-ruse/story-fndo45r1-1226489767612">“unsophisticated investors”</a>. Quite clearly there’s a need for re-evaluation and improvement to the current legislation, and no one should mistakenly believe it’s an answer to an increasing and overwhelming demand for social housing.
All in all, in our current environment of low consumer confidence, high yields, increasing household expenses and potential upward pressure on house prices, further rate cuts are of no help at all to the most venerable in our community, and certainly not the outright answer to building a healthier economy.
So amidst the shouts of good news when/if the RBA cut the cash rate another 25 basis points on Cup Day, someone could perhaps consider the savers and renters who don’t have a mortgage, just a reducing pot of money and consequently, future security.
Catherine Cashmore is a market analyst with extensive experience in all aspects relating to property acquisition.
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catherinecashmore-6LXia3pPQj

Interest rate fall bad news for property buyers

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In my<a href="https://www.propertyobserver.com.au/developments/cbus-property-s-mark-percy-in-conversation-with-colliers-international-s-peter-chittenden/2012101557171" target="_blank"> recent conversation with Mark Percy</a>, executive manager of residential of Cbus Property, we explored some of the main issues confronting our sector. I was also very pleased to hear Mark express some refreshing thoughts across a range of ongoing topics impacting the housing market, as well as some timely points directly related to project marketing.
According to Mark, it is affordability that sits at the heart of limited new housing supply housing, combined with limited development sites and planning delays. He suggests that this will drive major changes with more demand for smaller houses and apartments already occurring.
“The demand for smaller homes is not only driven by  affordability. The increasing demand and acceptability of this form of housing  is complex, as it is being driven by many market factors such as the location of existing infrastructure, work, family, shops, restaurants, theatres, etc. Buyers will compromise their expectations on a dwelling size to be located as possible to this infrastructure and support network.
"This has led to the continued infilling of our major urban areas which has the added benefit of making better use of existing infrastructure. This has the added benefit of reducing pressure on providing infrastructure on the edges of the existing urban area but increases the demand for housing in the inner-urban areas.”
However, in the immediate future Mark believes that the biggest hurdle for the residential market is that there has been a shift in market conditions because of the lack of confidence among buyers and, although manifest in the issue of affordability, it is a very complex issue.
“Among owner-occupiers, there is a lack of confidence, and many people are simply not moving from their existing home. There are many reasons for staying put; many are financial, but there are also social and demographics working here.”
Mark believes that buyer motivation and timing have shifted, which he sees as key reasons for the big drop in demand and hence the fall in home building construction. The cost of moving and poor capital growth are other factors, Mark says.
“In NSW, because of stamp duty incentives available before 30 June 2012, we saw that investors and first-time buyers below $600,000 were very active in the market. But I think it could be argued that this may well have created a distortion in the overall market as many developers moved to change their product offering to meet the inflated demand in this sector of the market caused by the temporary incentives on offer.
"Immediately after 30 June, there was a noticeable drop in demand for new housing. I think that generally the product range and quality needs to be sufficiently broad to attract a cross section of buyers – focusing on one sector of the market is risky, particularly when demand for a particular sector of the market can be affected by Government incentives being introduced or withdrawn through the life of a project” he said.
But while Mark agrees that incentives create activity in the particular sector of the market to which they apply, he believes that despite the incentives that were on recently on offer, the wider market appears to have a lack of motivation and confidence.
While affordability is a big issue, Generation X and  Y are simply not driven to buy a home as any sort of priority, unlike their baby boomer parents were. This has reduced the formation of new households in this age demographic.
Mark cites the clear trend that Gen X and Y are more inclined to want to travel and stay at home longer than their parents did. Homes, either big homes or smaller ones, are today not on their short term agenda. But Mark thinks that the industry needs to think about how this will play out in the mid to long term when Gen X &amp; Y finally “settles down” – the development industry needs to focus a lot of attention and forward planning on this group of buyers to understand their drivers when it comes time to purchase a home and ensure that housing forms provided are suitable for this market.
“Clearly the market has changed in an almost generational shift in priorities and economic circumstances. They are happy to stay at home longer. Many are marrying and having children later and this trend, combined with what plans and aspirations mum and dad, the baby boomers, have is creating a fascinating mix of challenges and opportunities.
“Mum and dad might down-size and help the kids with by contributing some cash to assist their children to buy a home but this does not address the deeper issues of affordability.”
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Major challenges and hurdles faced in the residential sector
During my conversation with Mark Percy it became clear that 35 years of experience have helped to focus his thinking, when it comes to the industry’s structure and the hurdles the residential sector faces. However, Mark also clearly sees how improvements can be made and is keen that Cbus Property is, in its own way, able to play a part in this ongoing process.
“When you analyse the development industry’s hurdles, some of the current hurdles are big ones and, as might be expected, many are to do with availability finance. Finance feeds into every aspect of the market, it impacts on the amount that individuals can borrow and therefore how much they can pay for a home, but this is only one area of note, even if it’s a very visible issue and always talked about” he commented.
But Mark also points out that there are other major issues and these impact on the sustained record of low levels of housing construction in recent years that has limited new supply.
“The industry faces development funding issues. It’s a really big issue, and it is impacting both large and small players.
“Clearly anyone would be able to point to the fact that lending conditions have dramatically shifted since the GFC, and it could be said that the same lack of confidence among buyers has impacted the lenders who have become, by circumstance, much more conservative in their lending.
“This is not to suggest this is an overall bad thing, but it has caused a big shift in how the industry plans, manages and delivers projects. One key point is that equity levels have moved to new higher ground, developers are now required to contribute much higher equity, close to 30% or 40%. I think that for many developers this is the issue of the decade."
Across the industry few would not agree with Mark’s comments as there is now a clear struggle to breach this equity gap and secure a very high level of pre-sales off the plan. This is impacting on how projects are being sold and marketed. Banks often have a pre-sales requirement reaching 100% of the senior debt facility limit before they will commence funding a project.
“Some of the key reasons organisations are looking to partner with Cbus Property is our experience because and financial capacity.
“Obtaining ever more pre-sales requirements are a trend we are not exempt from, and this is creating other challenges. The market is more product / affordability  sensitive and needs to design for the off the plan market – this, for example, has reduced the number of larger two- and three-bedroom apartments in projects, as these are generally difficult to sell before construction, and securing project funding is often viewed from this perspective. This feeds into affordability at every level of the market – smaller apartments are much easier to sell off the plan and therefore help to somewhat de-risk the project. Smaller apartments go some way to assisting with affordability constraints.”
“Affordability is a complex issue, it’s easy to point to one area or another, like interest rates or high selling prices, but in reality many factors are involved. Everyone talks about this issue and there does need to be a concerted effort to improve affordability.
“Land value is a big issue. If you own a parcel of land with no particular motivation to sell, then you can simply sit and wait for a high price. Construction costs are often mentioned but I believe we generally build efficiently. Builders’ margins are generally low for the risks they are responsible for. Quality has to be there, and there is no room to build below a particular quality standard to make a home more ‘affordable’ – that can simply devalue the housing stock, if you create rubbish you simply create another set of problems and destroy the reputation of the company and the overall industry.
“There is also the very real impact of how government levies and charges are imposed. This area is one of the biggest costs to developers, the fees are payable up-front, and so these costs have to be financed and add to finance costs from day one. If the majority of levies could be paid towards the end of the project, this would be of much greater assistance.
Like many others in the development industry, Mark points to the need to balance just how much can be charged against new developments by authorities and government and how services should be paid for. The real point is should all of this cost be captured up-front, from the developer and the initial buyer? After all, most of the services will be there for all of the foreseeable future, not just for the current generation.
“Developers build roads and other forms of infrastructure, built and then used for decades. These are dedicated to the local council or supply authorities who in-turn collect a revenue stream, in the form of rates for local councils while utility companies get a parcel of customers that the developer delivers.
Stamp duty has a major impact on affordability and the rate increases with the value of the home, it impacts greatest on the mid and upper market. As evidenced in NSW before 30 June this year, when it was waived for new dwellings under $600,000, affordability can be  improved and buyers are motivated to commit to a purchase with this form of assistance.
I think that Mark’s comments help to move affordability beyond the monthly interest rate cycle, or reports of the ups and downs of house prices into a complex array of issues at every level of the market.
Mark commented to me that he encounters this topic frequently and he continues to argue that this is a multifaceted topic, and in the next post we will look at the impact of planning policy, another core topic, but one that also impacts affordability.
Peter Chittenden is managing director for residential of <a target="_blank" rel="nofollow" href="https://www.colliers.com.au/Colliers%20Corporate/Residential.aspx">Colliers International.</a>
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