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.

Joel Robinson

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

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

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

Luxury apartment buyers have long prioritised design, space and finishes, but increasingly they're placing equal importance on something less tangible: how easily they can live without relying on a car.

At <a>Richmond Square</a>, <a href="https://www.apartments.com.au/developers/fortis">Fortis</a> believes that convenience begins beyond the apartment itself, with the mixed-use precinct earning a near-perfect Walk Score of 99.

The development has been planned around the idea that some of the most valuable amenities aren't contained within a building, they're the restaurants, cafés, parks, transport connections and daily conveniences that can all be reached on foot.

Located just behind Swan Street and Church Street, <a href="https://www.apartments.com.au/new-apartments/richmond-square-1-wiltshire-street-richmond-vic-3121">Richmond Square</a> places residents within one of Melbo​u​rne's most established lifestyle precincts while offering a quieter residential setting removed from the busiest thoroughfares. East Richmond Station is moments away, trams run along both Swan and Church Streets, and the MCG, Melb​​ourne Park, Yarra River trails and the CBD are all within walking distance. At the same time, the precinct itself will introduce a curated mix of dining, retail, hospitality and wellness offerings, creating a destination that extends well beyond its residential buildings.

[smartcode_project:default project_id=13181 project_image_fid=348530]

For Fortis, that combination of location and scale was what made the site unique.

"<a href="https://www.apartments.com.au/developments/richmond-vic-3121">Richmond</a> is one of Melb​o​urne's most established and distinctive inner-city neighbourhoods, with a rare combination of dining, culture, recreation, public transport and proximity to the CBD," the developer said.

"The opportunity at Wiltshire Street was particularly compelling because the site sits slightly removed from the activity of Swan and Church Streets while remaining only moments from everything that makes the area desirable."

Rather than developing a standalone apartment building, Fortis consolidated 15 individual properties to create one of the larger development parcels assembled on Mel​b​ourne's city fringe in recent years. That allowed the team to deliver a genuine mixed-use precinct comprising 107 residences across Wiltshire House and Carmine House, premium office space, hospitality venues, retail, wellness offerings and a future 57-room hotel.

"The scale of the site allowed Fortis to think beyond a standalone apartment building," the developer said.

"Richmond Square could be planned as a complete lifestyle precinct, bringing homes, workplaces, dining, retail, hospitality and wellness together around a series of activated public spaces. The aim was to create a destination that feels connected to Richmond rather than separate from it."

[smartcode_project:default project_id=13181 project_image_fid=348533]

The emphasis on walkability has also resonated with buyers.

Interest has been strongest from established owner-occupiers, particularly downsizers from Richmond and Melb​ourne's inner east who want to remain close to familiar restaurants, workplaces, family and social networks while moving into a more secure, lower-maintenance home. The project is also attracting Mornington Peninsula and interstate buyers seeking a Melb​ourne residence they can lock up and leave between visits.

Many are looking for generous living spaces, room to entertain, quality finishes and confidence in the project team, but location remains one of the biggest deciding factors.

"For many buyers, Richmond Square provides a way to simplify the practical side of home ownership without reducing the quality of their lifestyle," the sales team said.

"Location is also a major driver of interest. Buyers can remain connected to the CBD, major sporting events, the arts centres, local restaurants, cafes and bars and their family while living in a private and secure residence that is easy to lock up and leave for weekends or longer periods away."

[smartcode_project:default project_id=13181 project_image_fid=348549]

The residences themselves have been designed with that buyer in mind. Award-winning architecture practice SJB and interior designers Hecker Guthrie have created spacious two and three-bedroom apartments and penthouses that prioritise generous living areas, natural light, bespoke joinery and private terraces. Above, a rooftop sanctuary by Acre includes landscaped lawns, bookable dining rooms, barbecue facilities, wellness spaces and panoramic views across the CBD, the MCG and Port Phillip Bay.

Fortis believes Richmond Square reflects a broader evolution in apartment living, where the surrounding neighbourhood becomes just as important as the residence itself.

"Richmond Square introduces a different proposition: generously proportioned residences within a genuinely mixed-use, hospitality-led destination," the developer said.

"The project's location and Walk Score of 99 further support a lifestyle where residents can complete many everyday journeys without relying on a car."

Fortis has assembled an experienced team that includes <a href="https://www.apartments.com.au/architects/sjb-architects">SJB</a>, <a href="https://www.apartments.com.au/interior-designers/hecker-guthrie">Hecker Guthrie</a>, <a href="https://www.apartments.com.au/landscape-architect/acre">Acre</a> and builder <a href="https://www.apartments.com.au/builders/hacer-group">Hacer Group</a>, reflecting the developer's commitment to creating projects with enduring design quality and meaningful connections to the communities in which they sit.&nbsp;

Richmond Square is an expression of that philosophy, bringing together homes, workplaces, hospitality and wellness within one of Me​lb​ourne's most walkable neighbourhoods.&nbsp;

Construction is now almost complete, providing purchasers with growing confidence ahead of its expected September 2026 completion.

[smartcode_project_cta:default project_id=13181]

Walk Score of 99 places Richmond Square at the heart of Melbourne's most connected lifestyle

<h3 data-end="19" data-section-id="1dvgwoe" data-start="0">Summary</h3>

<ul data-end="634" data-start="21">
	<li data-end="170" data-section-id="1o77v31" data-start="21">Walker Corporation has lodged plans for a second major residential development in the Maroochydore City Centre, a 29-storey tower known as Celeste.</li>
	<li data-end="327" data-section-id="1lb0y6t" data-start="171">The Plus Studio-designed proposal at Lot 30 Sunshine Coast Parade would deliver 208 apartments, including four four-bedroom sub-penthouses and penthouses.</li>
	<li data-end="487" data-section-id="za720" data-start="328">The application comes as Walker doubles down on Maroochydore following the strong sales campaign at SOL by Walker, where the first tower is nearing sell-out.</li>
	<li data-end="634" data-section-id="5sovec" data-start="488">Walker is a key partner in the transformation of the Maroochydore City Centre, which is expected to ultimately deliver at least 4,000 new homes.</li>
</ul>

Walker Corporation is doubling down on Maroochydore following the successful sales campaign at its first residential project in the emerging CBD.

The national developer has filed plans for <a href="https://www.apartments.com.au/new-apartments/celeste-30-sunshine-coast-parade-maroochydore-qld-4558">Celeste</a>, a new 29-storey apartment tower at Lot 30 Sunshine Coast Parade, just metres from its under-construction SOL by Walker development.

The plans, prepared by Plus Studio, would see 208 apartments delivered across a 100-metre tower on the 2,376 sqm site, which fronts Sunshine Coast Parade, First Avenue and Future Way within the Maroochydore Priority Development Area.

<img alt="Walker" data-entity-type="file" data-entity-uuid="17038209-6fea-4ed2-855d-fd4df65b3d02" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-10%20at%2010.24.16%E2%80%AFAM.png?VersionId=iZD.oVXcQn.aLpUytDAW.CWjxP4puWMy" />

The proposed apartment mix comprises 36 one-bedroom apartments, 48 two-bedroom apartments, 72 two-bedroom apartments with an additional multipurpose space, and 48 three-bedroom apartments.

The upper levels would be capped by two four-bedroom sub-penthouses and two four-bedroom penthouses, taking the total apartment count to 208. The preliminary yield study also provides 262 car spaces, 114 resident bicycle spaces and storage for each apartment.

It represents Walker's next major residential move in the new Maroochydore CBD after the success of SOL by Walker, its $220 million two-tower project nearby.

SOL launched to market in early 2025 and has since seen strong demand, particularly from local owner-occupiers. By February this year, Walker said the first SOL tower was nearing sell-out, with a strong waitlist also emerging for its recently released penthouse collection.

Construction is already underway on SOL, with the first tower expected to be completed in late 2027 and the second to follow in early 2028.

[smartcode_project:default project_id=147777 project_image_fid=319846]

<h2 data-end="2518" data-section-id="1b2dyo5" data-start="2459">Celeste to rise 100 metres over Maroochydore City Centre</h2>

Celeste would take a different form to the twin 19-storey buildings at SOL.

Plus Studio has designed a single 100-metre tower above an activated podium, with the architecture responding to the site's prominent position and three street frontages.

The podium would incorporate commercial tenancies and public art, with sweeping façade elements wrapping the street edges. The scalloped concrete podium has been inspired by the patterns created in sand at low tide, while extensive landscaping would continue vertically through the tower.

The ground level plans show three commercial tenancies addressing Sunshine Coast Parade alongside the residential lobby and landscaped public realm. The podium would then accommodate several levels of car parking before the residential tower rises above.

<img alt="Celeste" data-entity-type="file" data-entity-uuid="121f77b1-71c5-46d7-9b36-0a7d474211ca" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-10%20at%2010.24.47%E2%80%AFAM.png?VersionId=MGrg9Hb7HgzLN0Lelq_xrXNAruVl77ia" />

Plus Studio said the tower had been designed to maximise views from each apartment, taking in the Maroochy River, Sunshine Coast hinterland, Cotton Tree and Maroochydore Beach and ocean.

Those views have also shaped one of the project's key features, with Walker proposing to put the primary resident amenity on Level 29 rather than lower within the building.

The rooftop would feature a 284.9 sqm pool area with an infinity edge, along with a cold pool, spa, sauna, 93.2 sqm gym, sunset lounge, BBQ and dining areas, pool deck and private dining space. Cabanas and day beds are also shown across the recreation level.

The two penthouses would extend across the upper levels and each feature private terraces and plunge pools.

<h2 data-end="4202" data-section-id="v5f4ix" data-start="4160">Walker's growing Maroochydore footprint</h2>

Celeste further reinforces Walker's commitment to the transformation of Maroochydore City Centre.

Walker is one of the key partners delivering the new CBD alongside Sunshine Coast Council and SunCentral Maroochydore, with the broader 62-hectare Priority Development Area occupying the former Horton Park Golf Course and surrounding land.

The precinct is ultimately expected to accommodate at least 4,000 new homes as Maroochydore evolves into the Sunshine Coast's principal commercial and residential centre.

When SOL secured approval in February 2025, Walker Managing Director and CEO David Gallant described it as the "first of many residential projects" the company planned for the Maroochydore City Centre.

Celeste now provides the clearest indication yet of what comes next.

The site sits immediately within the new CBD, with the design report identifying Sunshine Plaza and surrounding parkland within walking distance and Maroochydore Beach around a five-minute drive away.

For Walker, the timing of the application comes as its first residential bet on the new CBD appears to have been vindicated.

SOL has progressed from planning approval to construction while its first release has approached sell-out, giving Walker confidence to push ahead with another 208 apartments and take its residential pipeline in the Maroochydore City Centre to around 450 dwellings across the two projects.

Celeste remains subject to planning approval, with the architectural material describing the scheme as a preliminary yield study that may change through the assessment process.

Walker doubles down on Maroochydore with 29-storey Celeste apartment tower

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

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?

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The construction industry continued to contract in June, with the biggest decline recorded in the building of new apartments, according to the Australian Industry Group Australian (AI Group) Performance of Construction Index. 
 
The overall index, compiled in conjunction with the Housing Industry Association (HIA), remained broadly unchanged at 34.8 and in steep contraction given that a reading of 50 or below indicates a contraction in activity. 
The index has now been in contracting for 25 straight months, reaching its lowest reading of 28.9 in February 2009.
Click to enlarge
<a href="/images/stories/2012/07/hiajuly6.gif" rel="shadowbox" title="Click to enlarge"><img src="/images/stories/2012/07/hiajuly6thumb.gif"></a>
The apartment building sub-sector index fell from 26.7 in May to 21.8 to be the weakest sub-sector, recording its steepest fall in 10 months. 
Both residential and commercial construction sub-sectors remained “deeply in “negative territory in the month. 
"The residential and commercial construction sub-sectors continue to be a drag on overall business activity, with lack of demand and access to finance both holding these important sub-sectors back,” says Peter Burn, director of public policy at Ai Group. 
“Engineering construction (down to a reading of 39.9) is stronger particularly due to mining-related projects but the overall construction sector continues to languish," Burn adds. 
HIA chief economist Dr Harley Dale noted the “steeper contraction in new orders for detached houses and apartments”, which he says “unfortunately confirm that new home building conditions will deteriorate further in the second half of 2012”. 
“Residential construction activity looks set to trough at GFC-equivalent levels and yet we’re not in the midst of the GFC. That is a concerning update on Australia’s economic prospects and policy makers should heed this clear signal for policy action," Dale says. 
The results of the index also reveal that poor demand and falling workloads impacted heavily on activity (down from 30.2 to 28.9), new orders (down from 33.7 to 33.4) and employment (up marginally from 38.4 to 38.7) in June. 
Engineering construction remains the strongest sector despite falling by 1.4 points to 39.9 in June.
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Apartment construction activity records sharpest fall in 10 months in June: AIG/HIA construction index

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The empty former Melbourne Vinegar Company warehouse premises in Northcote has been sold for $707,000 by jewellery designer Tessa Blazey.
<img src="/images/stories/2012/07/vinegar.jpg">
Historical photos courtesy of the <a target="_blank" href="https://dhe.darebin-libraries.vic.gov.au/encyclopedia.asp?id=336">Darebin Historical Society</a>
It was constructed in the 1920s as SK Dixon flour business, which morphed into the Melbourne Vinegar Company and from 1958 was owned by Skipping Girl Vinegar, representing an authentic piece of Melbourne's history, according to the Darebin Historical Encyclopedia.
Shayne Mooney at Nelson Alexander marketed the property as in the heart of Ruckers Hill.
<img src="/images/stories/2012/07/vinegar2.jpg">
“The huge warehouse shell presents the ultimate blank canvas on which to create a residential masterpiece,” he says.
It last sold at $318,000 in 2004.
<img src="/images/stories/2012/07/vinegar3.jpg">
Buyers’ advocate Paul Osborne, from Secret Agent, observed there were five bidders at the auction.
It is a large open warehouse shell behind its facade.
While totalling only 150 square metres internally, the internal space could be used to create three floors. Live Load architectural practice partners Quinton Duffy and Julia Lehmann prepared a possible concept for implementation. The plans must be commenced by November 2012 to ensure compliance with the council approval timetable.
Its most recent taxable land value was $377,000 in early 2012.
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New owner to savour former Melbourne Skipping Girl Vinegar Company warehouse  after $707,000 auction

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353 Lakedge Avenue, Berkeley Vale, NSW, 2261
<img src="/images/stories/2012/07/lakedge.jpg">
With lake views, this three-bedroom house has been rented to the same tenant for the past six years. The lease is expired. The current tenants are paying $350 per week in rent, and listing agent Peter Moran of Property Central says market rent for the house would be about $400 per week. The light and airy property is close to schools, shops and a lakeside walking track
Moran <a href="https://www.propertycentral.com.au/index.cfm?pagecall=property&amp;propertyID=2069954" target="_blank">is marketing the property</a> with price hopes of $349,000 plus, and if it sells for that price that would secure an investor a gross rental yield of 5.2% at its current rent, below the indicative gross rental yield for Berkeley Vale houses of 5.7%, according to RP Data. At $400 per week it would secure an investor a gross rental yield of $6%. The gross rental yield does not consider the costs of maintaining the property, including council rates and other fees such as water bills and managing agent fees.
<a href="https://calc.washingtonbrown.com.au/wbdcalculator/calculator.aspx?RID=HPCAZOPTTT" target="_blank">Washington Brown</a> estimates the first-year tax depreciation deduction to be $3,000 and over five years to be $7,000.
The median house price in Berkeley Vale fell 5.2% in the past year and rose 3.2% in the past five years, according to RP Data.
The property will be open for inspection Satuday, July 7 at 1.3opm and will go to auction Saturday, July 14 at 2.30pm.
For more information about prices and yields in Berkeley Vale, see the RP Data suburb page.
For another investment prospect open for inspection this weekend, see page 2.
 
<hr class="system-pagebreak">
 
1/32 Roberts Road, Airport West, VIC, 3042
<img src="/images/stories/2012/07/robertsrd.jpg" width="470">
This two-bedroom villa unit is currently rented on a month-to-month lease at $1,040 per month, which listing agent David Gigliotti of Moonee Valley Real Estate says is about market rent for the area. The property is close to shops and transport and has a carport and a rear courtyard.
Gigliotti<a target="_blank" href="https://agents.realestate.com.au/cgi-bin/cs/run.pl?_t=Details&amp;_c=MOQAVO&amp;id=110897343&amp;code=54693313&amp;time=1341556385&amp;f=0&amp;p=4&amp;tot=21&amp;t=res"> is marketing the property</a> with price hopes of $260,000 plus, and if it sells for $260,000 that would secure an investor a gross rental yield of 4.8%, above the indicative gross rental yield of 4.1% for Airport West units, according to RP Data. The gross rental yield does not consider the costs of maintaining the property, including council rates and other fees such as water bills and managing agent fees.
The median unit price in Airport West  fell 5.1% in the past year, according to RP Data.
<a href="https://calc.washingtonbrown.com.au/wbdcalculator/calculator.aspx?RID=HPCAZOPTTT" target="_blank">Washington Brown</a> estimates the first-year tax depreciation deduction to be $4,000 and over five years to be $10,000.
The property will be open for inspection Saturday, July 7 at 10.45am and will go to auction Saturday, August 4 at 11am.
For more about prices and yields in Airport West, see the RP Data suburb page.
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Friday form guide: Yields of up to 6% in Berkeley Vale

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Louis Christopher of SQM states:
“ [RP Data-Rismark’s] daily hedonic index, for which these claims are based on, is an unreliable index as it is based on a miniscule proportion of actual sales that happen on a daily basis. Effectively on a day to day basis, the index misses out on over 95% of sales. And since it is an unrevised index, it means those missing sales are never taken into account.”
RP Data-Rismark response:
The above statement is categorically incorrect.
The <a href="https://www.propertyobserver.com.au/residential/rp-data-rismark-march-1-daily-index/2012030153640" target="_blank">RP Data-Rismark index </a>uses ALL available sales information. Yes all, not just for the current day, but also all historical data. The index then produces the best estimate of the current state of the market from this data. Where sales data is not received the day of contract exchange, it is not ignored or unutilised. It is used in statistical and mathematical methods to account for the timing difference between the sale date and the date we receive the information. If we receive information about a sale one week after it has occurred, we use that sale to update our current view of the market, mathematically taking into account that the sale occurred one week ago. The information in that sale is still very much relevant to determining the current state of the market and our models therefore incorporate it.
In SQM’s newsletter earlier this week the index was criticised because of an example of where it was claimed the index fell by 1% on a given day. The fact is that the index change was 0.99/630.64, a decline of only 0.16%.
SQM Research claims that because the Melbourne index fell after a February rise that this is evidence that the increase in February must have not been correct. This claim is also wrong. Markets do not follow a straight point to point trajectory in any direction. They do, however, demonstrate natural volatility and seasonality as they traverse their path. Prior to the daily RP Data-Rismark index, these daily market movements were not observable in the Australian residential property market. A movement of 1% or 2% over the course of a month is negligible when compared with the movement in the stock market over a similar period. For example, even in a market that is declining it is possible to find periods where it is possible to have traded in and out at a profit.
Although the index provides a daily measure of the performance of the housing market, SQM Research fails to adequately acknowledge the following:
•             The small number of sales on one day doesn’t conclusively reveal how much the whole market has changed in value. A house that sold yesterday has almost as much relevant information as a house that sold today.  The time lag of previous sales is taken into account statistically via the hedonic imputation method. It gives us the best estimate of the value of our market portfolio, based on all the available historic information. 
•             We record all available sales and use them as the data arrives in our database. We use statistical methods to account for the timing difference between the sale date and the date we receive the information. If we receive information about a sale one week after it has occurred, we use that sale data to update our current view of the market, mathematically taking into account that the sale occurred one week ago. Over time, our indices self-update to reflect all available information, rather than publishing revised indices on a regular basis.
•             The index will react to changes in the market when it receives sales information showing sufficient numbers of sale prices higher or lower than those expected by the previous day’s model. It cannot react until given this information because it will have no evidence to do so.
•             The indices give the best estimate of the value of a diversified investment portfolio, using all the information available at the time of publication. Each day this information is updated on average by 1,400 transactions, which in turn inform the next day’s best estimate.
RP Data and Rismark are the only housing market index providers to have commissioned independent audits of our methodologies.  The results of these assessments can be viewed on the <a href="https://www.rpdata.com/research/rp_data_rismark_home_value_index_methodology" target="_blank">RP Data website</a>.
Additionally, white papers detailing the index construction and methodology are also available at the same link.
As Christopher Joye has pointed out in a recent article the RP Data-Rismark indices are regularly referenced by the Reserve Bank of Australia as well as other government departments and the economic community.  Additionally, they are now the only house prices indices quoted in the Reserve Bank’s chart packs.
We would presume these groups use our measure of housing market conditions because they are the timeliest and most accurate measures available.
Tim Lawless is national research director at<a target="_blank" href="https://www.myrp.com.au/"> RP Data.</a>
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RP Data-Rismark’s defence of the daily hedonic home value index

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Now that we’re at the stage of the property cycle where capital growth is lower, and it’s likely to remain that way for some time, more investors are asking: “what’s the right investment strategy?” 
Recently Gail Kelly, CEO of Westpac, warned that Australia is unlikely to ever again see the type of housing boom that sparked a massive rise in personal wealth in the past decade. 
 
At around the same time Reserve Bank of Australia governor Glenn Stevens said the RBA was not trying to “engineer a return to a housing price boom” by lowering interest rates.
So what is an investor meant to do? Is it time to consider cashflow-positive properties? 
How property investors make their money
Firstly it’s important to understand property investors make their money in four ways:
<ol start="1">
<li>
Capital growth – the increase in value of their properties</li>
<li>
Rental returns – which provide cashflow</li>
<li>
Tax benefits – such as depreciation allowances and negative gearing </li>
<li>
Forced appreciation – this is where an investor “manufactures” capital growth through renovations or development. </li>
</ol>
Smart investors benefit from a combination of all of these.
Can I still get capital growth? Recently <a href="https://www.ampcapital.com.au/" target="_blank">AMP Capital</a> reported that since the 1920s, real estate has returned 11.1% p.a. after allowing for capital growth and rents. That’s a pretty impressive long-term track record  
While there is little doubt that average capital growth will be lower for the next few years, there will always be some pockets that outperform the averages. And within those areas there will be some properties that grow strongly in value while others perform poorly. That’s how averages work.
What about positive cashflow? A positive cashflow property is one where the rental income received covers all of the property’s expenses (including interest), leaving money in your pocket each month. 
In general properties with higher capital growth have lower rental returns. This means you can’t find cashflow-positive properties in the higher growth, better locations of our capital cities. You must look to regional areas or mining towns where buyers require a higher rental yield (cashflow) to make up for the lack of capital growth.
Of course buyers with lower loan-to-value ratios, those who put more money in the deal may also experience positive gearing. The problem is they miss out on the benefit of leverage.
 
<hr class="system-pagebreak">
 
Which strategy is better – capital growth or positive cashflow? There’s no simple answer. Clearly if both strategies exist there is a place for both of them.   
I see more beginning investors go for cashflow-positive properties.
On the other hand I tend to see more successful investors, those who have built a substantial asset base, grow their portfolio through leveraging off the capital growth of their investments.
Obviously property investment should be part of a wealth creation strategy, not just a purchase in isolation. So if you are considering property investment to build an asset base to one day replace the salary from your day job, then I would invest for capital growth every time.
The few dollars a week your positive cashflow properties might bring in immediately is not really going to make much difference to your lifestyle or your ability to acquire and service other, more desirable properties for your portfolio.
The problem is that you can’t save your way to wealth – especially on the measly after-tax positive cashflow you can get in today’s property market.
And when interest rates increase – as they will again some day – a property that is cashflow positive today may be cashflow negative tomorrow.
Think about it: Real wealth is not derived from income. It is achieved through long-term capital appreciation and the ability to refinance to buy further properties.
If you seek a short-term fix with cashflow-positive properties, you’ll struggle to grow a future cash machine from your property investments. It’s as simple as that.
But here’s the trick: You can’t turn a cashflow-positive property into a high-growth property because of its geographical location.
But you can achieve both high returns (cashflow) and capital growth by renovating or developing high-growth properties. This will bring you a higher rent and extra depreciation allowances, which convert high growth, relatively low cashflow properties into high-growth, strong cashflow properties.
This means you can get the best of both worlds.
So how do you cope with negative cashflow?
Of course investing in negatively geared, high-growth property means you have to cover the cashflow shortfall each month.
One way of doing this is to set up the correct loan structure. A line of credit could be used to supplement the rental to pay the interest on the investment loan and property expenses.  This buys an investor time. 
The line of credit is often set up to cover the shortfall for three or more years until the property’s value grows sufficiently to refinance the loan out of the extra equity. 
To use this investment strategy, correct asset selection is critical because to make it worthwhile you need the property’s value to increase significantly more than your outstanding loan balance increases. 
This means you need to be investing in high-quality assets so that you can maximise the chances of enjoying strong capital growth. 
This strategy is not without risks… The four main risks are:
<ol start="1">
<li>
Poor capital growth – that’s why correct asset selection is so important.</li>
<li>
Interest rate increases – which can be addressed by fixing interest rates on some or all of your debt.</li>
<li>
Poor rental growth – which highlights the importance of owning properties that will be in continuous strong demand by a wide demographic of tenants.</li>
<li>
Lack of financial discipline – never use your financial buffers for uses other than covering your property related expenses. </li>
</ol>
I can understand why beginning investors would be keen to buy a property with positive cashflow. They tend to be cheaper, so it is easier to purchase and support this type of property. While they may give you short-term income, these properties will never allow you to accumulate the equity necessary to become truly wealthy. 
And while the rent may seem relatively high initially, it is the ongoing capital growth of your property that will underpin its long-term rental income, which means that if you buy in low capital growth areas, your rents won’t rise over the years as much as rents in high-growth areas. 
This means the value of capital gains over the long term will blow comparable cashflow returns out of the water. 
Remember as a property investor your focus should be on safely building your asset base so you can eventually develop the passive income from your assets that will allow you to enjoy the financial freedom you desire.
 Michael Yardney is the director of <a href="https://www.metropole.com.au/">Metropole Property Investment Strategists</a> , a best-selling author and one of Australia's leading experts in wealth creation through property. He also writes the <a href="https://www.propertyupdate.com.au/">Property Investment Update</a> blog.
For Michael Yardney's take on investing in property given current economic tumoil, watch the video below
{qtube vid:=gNeDx9IkM0I&amp;list=PLC827F0952BF6BF47}
 
 
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You don’t have to choose between positive cashflow and capital growth in property

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There were 1,059 residential sales in Perth this week, with 22 of them in East Perth.
<img src="/images/stories/2012/07/reiwajuly5.jpg">
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East Perth WA's top-selling residential suburb this week: REIWA

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Dim the lights, don the snuggie and pass the chocolate; Downton Abbey is back.
Amid all the mooning over Matthew and Mary, viewers may not have noticed that Downton Abbey is actually about property law. Like Jane Austen’s Pride and Prejudice, the central dilemma of the series is the existence of a <a target="_blank" href="https://legal-dictionary.thefreedictionary.com/Fee+Tail">fee tail</a>.
<img src="/images/stories/2012/07/downton1.jpg">
The fee tail stipulates that Grantham Estate cannot be left to beautiful, intelligent, spoilt Mary, but must pass to the nearest male relative, Matthew, a Manchester solicitor. Arguably worse than Austen’s odious Mr Collins in Pride and Prejudice.
Fee tails served an important purpose for a feudal system in which status and wealth were largely determined by accident of birth. Leaving land by will with an entail ensured it would pass down a specific line of descendants and not be dissipated among people unrelated by blood. In the event that a particular line of descendants stopped, the land would revert to the original donor’s family.
Fee tails suited a feudal system of land ownership, but they did not suit emerging or fully fledged capitalist democracies.
First, fee tails were economically stultifying. The interest was effectively only an interest for the life of the current entail holder and thus (invariably) he could not raise money with it, sell it or lease it for longer than his life. Not surprisingly, tenants didn’t like to invest in leases that abruptly ended when their landlord fell off his perch.
Judges and lawyers waged a war of attrition against fee tails for centuries, developing ingenious legal devices to defeat them.
On a micro level, this would give the current holder the economic freedom to deal with his land as he pleased; on a macro level, it forced land out of the hands of families and on to the emerging, free land market. The Dowager Countess engages Matthew to investigate one of these legal devices, although we can be confident that she was not interested in facilitating the onward march of modern capitalism whose values are so antithetical to her own.
Second, fee tails were not just at odds with economic freedom but personal freedom and autonomy; at the risk of understatement, values that had been gaining traction for some time. In the 17th century, the English middle classes had fought hard to free themselves, and most importantly their property, from the arbitrary interference of monarchs. In the 19th century John Stuart Mill wrote eloquently about the necessary limit of government and social power over the individual; so long as people caused no harm to others, they were free to act as they pleased. This concept underpins modern land law (as long as you don’t live in strata, but that’s another story).
As an early 20th century aristocrat, Lord Grantham’s autonomy is not threatened by the government or monarch, but it is by his own ancestors. The fee tail allowed long-dead ancestors to determine land-use and disposition for generations to come. It is an example of “dead-hand control”, the nemesis of modern property law.
There is a delicious irony in the Dowager Countess and Mary’s frustration with Lord Grantham’s inability to freely determine to whom he leaves the land.
Personal freedom is a concept they have learned from the despised middle classes, the very people they are trying to keep the land from. Further, while they would like autonomy and agency for themselves, unlike the politically progressive Lady Sybil, it is not something they want to extend to their own housemaids or chauffeur.
Lord Grantham is at least consistent in his social theory. He does not want his chauffeur to have control of his own life, but neither does he want it for himself. He believes he is the temporary caretaker of his land, not its absolute owner in any modern sense.
The fee tail dilemma is a metaphor for a family trapped between two worlds. The dying world of an aristocracy with its roots in a feudal system and the new world of the capitalist, democratic state. Fittingly, fee tails were abolished in most common law jurisdictions, including the United Kingdom, by the 1920s.
Of course the fee tail dilemma is also a metaphor for the all important dilemma of love. Should Mary marry in the tradition of her ancestors, for money, status and wealth or should she embrace the values of the modern world, exercise her personal freedom and marry for love?
We’ll all have to get back to the sofa and snuggie to find out.
Cathy Sherry is a senior lecturer in the faculty of law at the University of New South Wales.
This article originally appeared on <a target="_blank" href="https://theconversation.edu.au/">TheConversation</a>.
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Downton Abbey a melodrama about property law – and frocks, intrigue and Matthew and Mary

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The amount of vendor discounting required to secure residential property sales peaked mid- to late last year, a "chill chart" released by Australian Property Monitors shows.
In Sydney, the average discount required in June 2012 was 6.7%, compared with 7.1% in August 2011. However, this is still higher than the average discount Sydney vendors had to offer in June 2010, which was 5.9%.
Melbourne discounting peaked in November 2011 at 8.1%, whereas in June 2012 Melbourne vendors offered discounts of 6.9% off initial price hopes to secure sales. Melbourne's average discount was 5.4% in June 2010. 
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The required discounting for Brisbane property hovered around 10.7% from June to September 2011, with the average discount in June 2012 at 8.4%. 
Adelaide vendors offered an average discount of 8.6% in September 2011, but in June 2012 that had fallen to 7.7%. However, the previous month the average discount required was 8.1% in Adelaide, not at its 2011 peak but still in the "red zone", according to APM. 
Perth vendors offered discounts as deep as 10.6% in August 2011, but June 2012's average discount for the WA capital was 7.3%. This is still up on the 6.4% average discount in June 2010. 
The average discount required in Canberra hit a peak of 6% in June 2011 and was not far off that in June 2012, at 5.5%. However, these "red" percentages for Canberra are still at or below "green" figures for other capitals, as Canberra vendors in general do not have to sweeten the deal as much as those in other cities.
Darwin's average discount for dwelling sales hit 10% in June 2011 and was at a much lower 5.8% in June 2012. This is only marginally up from the 5.4% average discount in June 2010.
Hobart's average discount has crept up in recent months, to be at 10.3% in June 2012. This is not as high as the 10.8% average discount in August 2011, but higher than the 8.4% and 8.5% in some months between August last year and June this year. In June 2010 the average vendor discount in Hobart was 6.6%.  
 
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Discounts required to secure residential property sales peaked in mid to late 2011: APM chill chart

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Mortgage fund manager Provident Capital was signing on small investors to its fixed-term mortgage fund with promises of returns above 9% in the months before it was placed in receivership yesterday.
Receivers from PBB have taken over the running of the company due to concerns debenture holders could be left short-changed.
Property Observer understands that 3,500 small investors have about $30,000 each invested in fixed-term products that mature at different times, with fears that Provident could run out of money to pay investors with later maturation dates.
The $120 million fund is invested in first mortgages covering residential, commercial and rural properties principally for property development.
In the December 2011 newsletter, Provident Capital managing director Michael O’Sullivan told clients: “We have recently launched a ‘lock in your rate’ campaign for our three-year and five-year fixed term investments, so that you can take advantage of our higher rates of returns before they are reduced.”
As of December 1 2011, Provident was offering new investors an annual return on maturity of 9.2% for a three-year fixed interest term and 9.55% for a five-year term.
<img src="/images/stories/2012/07/provident2.jpg">
In the December letter O’Sullivan added that Provident had a “proud track record of meeting all our investor payments on time, every time, there’s never been a better time to lock in your rates and take another fresh look at Provident Capital”.
In the same newsletter, Provident advertised its monthly income fund as offering an average annual return of 10.61% over the previous 12 months to October 2011 as well as it having previously been voted best-performing mortgage fund by Morningstar.
In its previous September newsletter, O’Sullivan told investors Provident “continues to go from strength to strength” and highlighted its “proud track record of meeting all our investor payments on time, every time during this entire period”.
Six months, later, in an information booklet published in April this year Provident said that as of December 31  the arrears rate across  its $176 million loan portfolio was 59.4% by value, of which the arrears rate for the fixed term investment funded component was 90.2%, "much of which was more than 180 days in arrears".
The lender continued to advertise its low-doc lending products through the mortgage broker channel this year, with an advertisement appearing on page six of Mortgage Professional Australia’s June 2012 issue.
<img src="/images/stories/2012/07/providentad.jpg">
The ad says Provident is offered low-doc non-conforming loans of up to $1.5 million for residential, commercial and rural purchases and promises brokers weekly commissions and no-commission claw-backs.
Non-conforming loans are generally provided to borrowers with poor or impaired credit history.
SQM research withdrew its rating and report of the Provident Capital Monthly Income Fund on June 14 a day before Provident’s $120 million debenture fund was frozen by federal court order.  The monthly income product is a seperate product to the debenture offering.
SQM withdrew its rating after downgrading the fund from 3.75 out of five to 3.25 in April, “a direct result of ongoing deterioration in the manager’s financial position and a lack of satisfactory communication from the manager on the current status of the responsible entity managing the monthly income fund”. 
SQM managing director Louis Christopher said at the time “the ongoing decline in the financial health of its manager cannot be ignored” 
A rating of 3.25 indicates that “caution is required”. 
On January 6 SQM had upgraded its rating of the fund from 3.5 to 3.75, a “good” rating and suitable for inclusion on investors’ approved product list - based on financials to June 30.
Christopher tells Property Observer SQM acted to downgrade the rating of the monthly income fund "the moment" it became aware of problems at Provident.
Provident results for the six months to December 31 (released in April 2012) reveals a loan portfolio worth $176 million
There are 95 residential loans worth just under $100 million, with 24 commercial loans worth $22 million and 17 rural loans worth $33 million.
The company made a half-year loss after tax of $9 million compared to profits of $800,000 in the previous corresponding period.
“The current economic climate presents a number of challenges. In particular, it is taking longer to recover all amounts owing where loans are in arrears and property values may not be sufficient to repay the amount owing,” says Provident
As of December 31 2011, the company’s equity capital ratio was 2.73% as compared to the benchmark ASIC ratio of 20.
The booklet notes that the “loans are designed to meet the needs of borrowers who do not fit the lending criteria of Australia’s traditional financial institutions or who simply choose not to borrow from them”.
 The Australian reported PPB Advisory partner and joint receiver Marcus Ayres as saying it would seek to recover funds by repossessing houses of defaulting borrowers and slowly releasing them into the market or by selling the defaulting loans if an investor could be found.
"This won't be a fire sale and we won't be putting all these properties out on to the market at the same time," Ayres said.
Provident has raised more than $1 billion of investor funds for investment in portfolios of registered first mortgages since 1998.
Have you invested in Provident Capital debentures or do you have a Provident Capital mortgage? Send an email to Property Observer with any news or thoughts:<a href="mailto:news@propertyobserver.com.au">news@propertyobserver.com.au</a>
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Provident Capital signing on new mortgage fund investors with 9% plus on offer in months prior to receivership

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Melbourne was the capital city to record the highest monthly increase in June sales stock, rising by 6.1% during the month to a total of 55,293 listings for sale, according to SQM Research.
There was no change in Sydney.
The national total online residential listings was up by just 1.7% for the month, to a 386,857 total, which represented a 6.4% annual increase.
 
<img src="/images/stories/2012/07/55293.gif">
The number of residential properties currently on the market in Melbourne, according to SQM Research. This is up 6.1% from last month.
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 <img src="/images/stories/2012/07/32390.gif">
The number of residential properties currently on the market in Sydney, according to SQM Research. This is exactly the same as last month.
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<img src="/images/stories/2012/07/28700.gif">
The number of residential properties currently on the market in Brisbane, according to SQM Research. This is up 3% from last month.
 
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The number of residential properties currently on the market in Perth, according to SQM Research. This is up 1.4% from last month.
 
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<img src="/images/stories/2012/07/17480.gif">
The number of residential properties currently on the market in Adelaide, according to SQM Research. This is up 0.7% from last month.
 
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The number of residential properties currently on the market in Hobart, according to SQM Research. This is up 0.5% from last month.
 
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<img src="/images/stories/2012/07/3728.gif">
The number of residential properties currently on the market in Canberra, according to SQM Research. This is up 0.7% from last month.
 
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<img src="/images/stories/2012/07/1326.gif">
The number of residential properties currently on the market in Darwin, according to SQM Research. This is up 5.9% from last month.
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