Apartment buyers in New South Wales are set to gain a decade of insurance-backed protection against major building defects, after the NSW Parliament passed the Fair Trading and Building Legislation Amendment Bill 2026.&nbsp;

The Bill establishes decennial defect insurance, known in the market as Latent Defects Insurance (LDI), as an alternative to the existing two-year strata building bond. It cleared the Legislative Council with amendments on Tuesday evening (August 4, 2026), with the Legislative Assembly agreeing to those amendments shortly after.

Under the reform, eligible developers can satisfy their statutory bond obligation by taking out an approved decennial-style policy that gives owners 10 years of cover for major structural defects from completion, claimable directly, without first having to pursue developers or builders through costly legal action.&nbsp;

The change forms the final tranche of amendments arising from the 2021 statutory review of the Strata Schemes Management Act 2015 and related legislation.

Resilience Insurance, which originated the cover in Australia and has delivered it in NSW since 2022, welcomed the passage and credited the NSW Government for delivering it.

“This is protection apartment buyers have needed for a long time, and the credit for delivering it belongs to the NSW Government,”&nbsp;said Corey Nugent, CEO of Resilience Insurance.

“Minister Chanthivong and his team have shown real leadership in replacing an outdated two-year bond with cover that matches the lifespan of the buildings people are buying into. Reform like this is what good, evidence-based regulation looks like.”

Resilience has delivered LDI in NSW since 2022, protecting thousands of apartments, giving the State, and now the country, real-world evidence of how decade-long, no-fault protection works in practice.

The reform also places NSW within a wider national shift.

NSW is the third jurisdiction to put decennial cover into law. The ACT legislated for it in 2024, with the scheme taking effect in late 2025, and Victoria passed its own framework on 17 June. Between them, the three cover the majority of Australia's apartment market.

The reform commences once the legislation is proclaimed, which is expected in the coming weeks. From that point, developers of Class 2 residential apartment buildings can meet their statutory obligation with an approved decennial policy in place of the bond.

Buyers who purchased into projects that took out the cover early are among the first in the country to take keys to apartments carrying decade-long structural protection.

“With the legislation passed, the focus now turns to making it work for buyers,”&nbsp;Nugent said.

“There are already thousands of apartments in NSW covered by this insurance, bought by developers who moved early. The question every buyer should be asking in a display suite is a simple one: does this building come with 10-year defect cover, and who stands behind it?&nbsp;

“We look forward to working with the Government and the Building Commission in coming weeks as the framework moves to implementation, and to sharing what we have learned over the past four years so the protection reaches owners as smoothly and quickly as possible.”

Other states are working through their own reform programs. Western Australia has indicated that decennial cover is within consideration a later stage of its reform sequence, and Queensland has been examining the settings as it looks at the development pipeline ahead of the 2032 Olympics.

Resilience Insurance acknowledges the NSW Government’s continued focus on strengthening consumer protection while supporting housing delivery across the State.

Fast Facts: What the reform means

<ul style="color:#222222; font-family:Arial, Helvetica, sans-serif; font-size:small; font-style:normal; font-variant-ligatures:normal; font-weight:400; text-align:start; white-space:normal; background-color:#ffffff; text-decoration-thickness:initial; text-decoration-style:initial; text-decoration-color:initial">
	<li style="margin-left:15px; font-family:Aptos, Arial, Helvetica, sans-serif; font-size:12pt; color:#000000">Proven at scale:&nbsp;Decennial cover has operated in NSW since 2022, protecting thousand of apartments.</li>
	<li style="margin-left:15px; font-family:Aptos, Arial, Helvetica, sans-serif; font-size:12pt; color:#000000">10 years of cover:&nbsp;Protection for major structural defects runs for a decade from completion, claimable directly and with no legal action required.</li>
	<li style="margin-left:15px; font-family:Aptos, Arial, Helvetica, sans-serif; font-size:12pt; color:#000000">An alternative to the bond:&nbsp;Eligible developers can meet their statutory obligation with an approved decennial-style policy in place of the 2% strata building bond.</li>
	<li style="margin-left:15px; font-family:Aptos, Arial, Helvetica, sans-serif; font-size:12pt; color:#000000">Part of a national shift:&nbsp;The ACT has had decennial provisions in force since 2025 and Victoria passed its framework in June. NSW now joins them.</li>
	<li style="margin-left:15px; font-family:Aptos, Arial, Helvetica, sans-serif; font-size:12pt; color:#000000">No-fault, first resort:&nbsp;Owners corporations claim directly from the insurer without first having to establish who is liable for the defect.</li>
	<li style="margin-left:15px; font-family:Aptos, Arial, Helvetica, sans-serif; font-size:12pt; color:#000000">Cost-competitive:&nbsp;At approximately 1.8% of build cost, LDI is typically priced below the 2% bond while offering broader, longer protection.</li>
	<li style="margin-left:15px; font-family:Aptos, Arial, Helvetica, sans-serif; font-size:12pt; color:#000000">Market position:&nbsp;Resilience originated LDI in Australia and has delivered it in NSW since 2022.</li>
</ul>

Fast Facts: What is Resilience LDI?

<ul style="color:#222222; font-family:Arial, Helvetica, sans-serif; font-size:small; font-style:normal; font-variant-ligatures:normal; font-weight:400; text-align:start; white-space:normal; background-color:#ffffff; text-decoration-thickness:initial; text-decoration-style:initial; text-decoration-color:initial">
	<li style="margin-left:15px; font-family:Aptos, Arial, Helvetica, sans-serif; font-size:12pt; color:#000000">Resilience Latent Defects Insurance (LDI):&nbsp;Covers major structural defects for 10 years from completion.</li>
	<li style="margin-left:15px; font-family:Aptos, Arial, Helvetica, sans-serif; font-size:12pt; color:#000000">Consumer-first:&nbsp;Direct claim access, no need for lengthy legal action.</li>
	<li style="margin-left:15px; font-family:Aptos, Arial, Helvetica, sans-serif; font-size:12pt; color:#000000">Cost advantage:&nbsp;At approximately 1.8% of build cost, LDI is typically priced below the traditional 2% Strata Bond while offering broader protection.</li>
	<li style="margin-left:15px; font-family:Aptos, Arial, Helvetica, sans-serif; font-size:12pt; color:#000000">Market leader:&nbsp;&nbsp;Resilience Insurance originated LDI in Australia and is the national market leader.</li>
</ul>

Joel Robinson

NSW parliament passes 10-year defect insurance laws for new apartment buyers

Builder-developer <a href="https://www.apartments.com.au/developers/mcnab-developments">McNab</a> has wasted little time reshaping one of South Brisbane's most significant undeveloped apartment sites after acquiring the property earlier this year.&nbsp;

McNab has lodged plans to scrap an existing approval for two 30-storey towers and instead deliver a single 28-storey residential building, preserving part of the site for a future development opportunity.

The proposal, lodged over <a href="https://www.apartments.com.au/new-apartments/64-peel-street-south-brisbane-qld-4101">64 Peel Street and 9 Cordelia Street</a>, is for a residential-led mixed-use development comprising 124 apartments above a landscaped podium, alongside a boundary realignment that preserves part of the land for a future residential project.

<img alt="First look: McNab resets decade-old South Brisbane approval with 124-apartment tower" data-entity-type="file" data-entity-uuid="743bf564-3f8f-45fc-b8d3-bbf18f5b628f" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/mcnab%20Peel%20st%20podium.png?VersionId=EhCxGrVn_VFH3qTbKnI4WppGwaMnOn0t" />

Designed by <a href="https://www.apartments.com.au/architects/hayball">Hayball</a>, the development will deliver 119 two-bedroom and five three-bedroom apartments across 23 residential levels. A five-level podium will accommodate 135 car spaces, while the ground floor will include a 66 sqm commercial tenancy, an activated residential lobby with work-from-home spaces, and a publicly accessible landscaped plaza linking Cordelia and Peel streets.&nbsp;

Communal amenities will span Level 6 and the rooftop, including indoor and outdoor recreation spaces, a swimming pool, barbecue facilities, kitchen and dining areas, lawn space, sauna, steam room and yoga facilities.

The application also proposes a boundary realignment to create a standalone 1,290 sqm development lot while retaining an adjacent parcel for future redevelopment, allowing the balance of the site to contribute additional housing over time.

Hayball said the architecture has been shaped by the site's elevated corner position at the intersection of Peel and Cordelia streets and Brisbane's subtropical climate.

The design incorporates generous landscaped setbacks, a masonry podium wrapped with planting, large north-facing balconies, and a slender tower profile intended to maximise natural light, cross ventilation and long-range views. The rooftop has been conceived as a wellness-focused retreat overlooking Brisbane, with amenities positioned to capture views towards Mount Coot-tha and the CBD.

<img alt="First look: McNab resets decade-old South Brisbane approval with 124-apartment tower" data-entity-type="file" data-entity-uuid="c5f99e84-6ad8-4a87-82d1-869685b754d2" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/mcnab%20tower%20perspective.png?VersionId=Gw0IuJaSAlk.tvGBxInhZOcQAdIB..2b" />

The planning submission positions the proposal as a response to both changing market conditions and Brisbane's Kurilpa Sustainable Growth Precinct planning reforms.

McNab acquired the site after the previous approval was granted, with the existing scheme no longer reflecting current residential market demands, economic conditions, construction challenges, construction efficiencies or the quality of development outcome now being pursued, the planning report noted.

McNab continues to expand its residential development pipeline across Brisbane and the Gold Coast. The developer recently launched The Tannery in West End, securing more than 60 per cent of apartments before the project's public release. It is also delivering Elements Budds Beach in Surfers Paradise and Lucia Highgate Hill, an eight-apartment boutique development overlooking the Brisbane River.

McNab resets decade-old South Brisbane approval with 124-apartment tower

A steeply sloping Bellevue Hill site is set to accommodate a new mid-rise apartment development, with plans lodged for 20 homes that respond to the site's dramatic topography.

The proposal for the consolidated land at <a href="https://www.apartments.com.au/new-apartments/138a-140-bellevue-road-bellevue-hill-nsw-2023">138A-140 Bellevue Road</a> has been designed by Sydney architecture practice Common Office, which has used the site’s substantial fall to distribute the building’s scale and unlock 20 apartments without presenting the full height to the street.&nbsp;

“The unique design strategy leverages the site’s substantial topographical fall to facilitate increased density, presenting a seven-storey profile to Bellevue Road while rising to 10 storeys at the rear,” Common Office said in its architectural design report.

The apartment mix spans one, two, three- and four-bedroom residences. Four two-bedroom apartments are designated as affordable housing, while the plans also include two adaptable dwellings. The mix is majority three-beds, with the typical three-bed apartment offering around 144 sqm internally, with balconies of around 15 sqm.

The affordable housing component represents 15 per cent of the residential floor area and allows the project to access additional height and floor space under the NSW Government’s in-fill affordable housing provisions. The site also falls within the inner area of the Low and Mid-Rise Housing Policy because it is within 400 metres walking distance of Double Bay Town Centre.

<img alt="First Look: Plans lodged for topography-led affordable housing project in Bellevue Hill" data-entity-type="file" data-entity-uuid="b1230d0f-3bfa-4a11-abaf-0928c66ef345" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Bellevue%20da.png?VersionId=dZeMK3P.OutGjN8ycjsxm8uNsj_QFWQv" />

Common Office has arranged the building around a masonry podium and a lighter upper volume, drawing on two recurring elements of Bellevue Hill’s established architecture: sandstone bases and the vertical proportions of local Inter-war Art Deco apartment buildings.

“The proposal is governed by a holistic design language that reconciles the solid horizontal masonry of the neighbourhood’s podiums with the elegant verticality of its Art Deco heritage,” the architect said.

“The building maintains a consistent rhythmic logic utilising deep recesses and a sophisticated material transition to break down the 10-storey scale into a series of articulated, human-scale volumes.”

<img alt="First Look: Plans lodged for topography-led affordable housing project in Bellevue Hill" data-entity-type="file" data-entity-uuid="0147f503-1af1-4d51-97fb-c2f1cba63a9d" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Bellevue%20bldg.png?VersionId=GoW7q3NlK67OpnePXhk7zvklrlKb72Qc" />

Large-format sandstone tiles will define the lower levels, establishing a robust base that negotiates the change in elevation from Bellevue Road. Above, red-tinted precast concrete frames, recessed balconies, anodised aluminium screens and expanded metal details will create a more vertically expressed façade. Integrated planter beds will introduce greenery across balcony edges and recessed sections of the building.

The elongated northern façade has been divided into three recessed vertical masses to reduce its perceived length. Triangular window elements and metal privacy screens reference the geometry of nearby Art Deco buildings while controlling overlooking toward surrounding homes. The southern elevation will incorporate further privacy screening, landscaped edges and deep balconies to maintain light and ventilation.

<img alt="First Look: Plans lodged for topography-led affordable housing project in Bellevue Hill" data-entity-type="file" data-entity-uuid="e8679cf1-18bc-4447-8a0f-0052b94ab83c" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Bellevue%20da%20rooftop.png?VersionId=5SQqQqRFf76rvE2p1TbxJSweMN70AIbc" />

Private and communal landscaping is distributed throughout the development. A landscaped garden apartment is positioned within the lower portion of the site, while a communal terrace on Level 5 will include a central timber deck, barbecue facilities, resident planting plots and areas for outdoor dining and informal gatherings.

Common Office described the terrace as an elevated sanctuary designed to capture district views and sunlight. Its planting strategy incorporates endemic species associated with the Eastern Suburbs Banksia Scrub, extending the landscape vertically through the building and providing habitat for local flora and fauna.

A second communal outdoor area is proposed at roof level, with built-in seating, paved gathering areas and perimeter planting.

Bellevue Hill is enjoying renewed momentum in the new apartment market, with several boutique developments recently launched and currently under construction. Positive Investment Enterprise is delivering the 16-apartment Kew Palm House on Birriga Road, while Chanine Developments is also under construction at Florian, a 36-apartment project on Banksia Road.

&nbsp;

Bellevue Hill is enjoying renewed momentum in the new apartment market, with several boutique developments recently launched and currently under construction.

First Look: Apartment development pitched for Bellevue Hill, Double Bay fringe

South Brisbane's apartment pipeline continues to build momentum, with <a href="https://www.apartments.com.au/developers/trk-property-group">TRK Property Group</a> lodging plans for a 161-apartment tower on Montague Road as developers accelerate investment across the Kurilpa Sustainable Growth Precinct.

The proposal for 176–186 Montague Road would replace an existing office building with a 20-storey residential tower designed by <a href="https://www.apartments.com.au/architects/cox-architecture">COX Architecture</a>, adding to a growing pipeline of high-density projects reshaping one of Brisbane's fastest-evolving inner-city precincts.

The project has been conceived as a "living building", featuring a flowing tower form, extensive vertical landscaping, and generous communal spaces that respond to the evolving Kurilpa Sustainable Growth Precinct.

TRK Property Group Development Director Matt Kan said the project reflected the confidence developers have in South Brisbane's long-term future.

"South Brisbane is entering an incredibly exciting period, and we see Montague Road sitting right at the heart of that evolution," Kan said.

"With the former Visy site directly opposite us and significant investment planned throughout the broader Kurilpa precinct, there is a real sense of momentum around this part of the city and what it will become over the coming years.

"For TRK, this is an opportunity to be part of that next chapter and deliver a project that responds to where the precinct is heading, while contributing to the continued evolution of Brisbane's river edge."

<img alt="First look: TRK Property joins South Brisbane apartment surge with Montague Road tower plans" data-entity-type="file" data-entity-uuid="590fe1ad-f892-4446-a679-80e33a16d029" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/TRK%20tower%20facade.png?VersionId=uOJStrcKpyHFcPE1w6_9SMAFzVMCcZll" />

The scheme includes a mix of one, two, three and four-bedroom apartments, incorporating multi-purpose rooms in selected residences to provide additional flexibility for home offices or expanded living areas. The proposed mix comprises 15 one-bedroom, 13 one-bedroom plus MPR, 73 two-bedroom, 26 two-bedroom plus MPR, 30 three-bedroom, and four four-bedroom apartments.

Rather than adopting a conventional rectilinear tower, COX Architecture has developed a sculpted form inspired by the movement of the Brisbane River.

"The proposal has been designed by COX Architecture as a 'living building' that responds to the site's riverine setting, floodplain history and evolving urban context within the Kurilpa Sustainable Growth Precinct," the planning report states.

"The architectural form draws from the fluid nature of the Brisbane River, with a curved and undulating tower form that creates a varied architectural edge and avoids a conventional rectilinear tower expression."

The podium has also been designed as an architectural feature rather than a conventional parking structure, with cascading planting, screening and natural-toned materials softening its appearance. Resident parking is elevated above ground level to address the site's flood constraints, while habitable apartments sit above flood planning levels. Upper-level communal facilities are designed to accommodate shelter-in-place arrangements during major flood events.

<img alt="First look: TRK Property joins South Brisbane apartment surge with Montague Road tower plans" data-entity-type="file" data-entity-uuid="01fa15d0-90df-46c7-9555-7941fc45373c" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/TRK%20podium.png?VersionId=mHyua.w1pHGBt9qEdWzrlsv.leztUCwO" />

Communal amenity is a major focus of the proposal. Around 1,815 sqm of shared resident space is proposed across the ground floor, level 19 and the rooftop, including co-working areas, indoor and outdoor recreation spaces, wellness facilities, dining and gathering areas, lawn spaces, a rooftop pool and spa, and extensive landscaping. At street level, a landscaped forecourt and approximately 345 sqm of publicly accessible open space along Montague Road are intended to improve the pedestrian experience while activating the building's frontage.

The development will provide 163 car spaces, including 152 resident bays and 11 visitor spaces, together with 144 bicycle spaces incorporating resident storage, visitor parking, bicycle maintenance facilities and e-mobility charging infrastructure.

The site sits within one of Brisbane's fastest-changing inner-city precincts, less than two kilometres from the CBD and within easy reach of South Bank, West End, the Queensland Cultural Centre and extensive public transport connections. The Kurilpa Sustainable Growth Precinct planning framework is encouraging higher-density residential development to help meet Brisbane's housing supply targets while supporting walkable, transit-oriented neighbourhoods.

TRK Property joins South Brisbane apartment surge with Montague Road tower plans

Article summary

<ul data-end="785" data-start="311">
	<li data-end="459" data-section-id="5hbcyr" data-start="311">Pikos Group has released the five-penthouse collection at Skye Kangaroo Point, headlined by a two-storey sky home spanning more than 1,000 sqm.</li>
	<li data-end="561" data-section-id="1p7lq8n" data-start="460">Early buyer interest suggests the residences could set a new Queensland apartment price record.</li>
	<li data-end="667" data-section-id="1y70z0l" data-start="562">The collection includes four move-in ready penthouses and the highly customised Skye One residence.</li>
	<li data-end="785" data-section-id="yvm0y1" data-start="668">The release caps one of Bri​sbane's most ambitious luxury apartment developments overlooking the Brisbane River.</li>
</ul>

<hr data-end="790" data-start="787" />
Pikos Group has released the five-penthouse collection at its <a href="https://www.apartments.com.au/buildings/skye-residences-by-pikos-kangaroo-point-8-river-terrace-kangaroo-point-qld-4169">Skye by Pikos</a> development in Kangaroo Point, with early buyer interest indicating the flagship residences could eclipse every apartment sale previously recorded in Queensland.

The collection crowns the luxury riverfront development with five residences, including four completed penthouses and Skye One, a two-level sky home spanning more than 1,000 sqm that will be tailored to its eventual owner.

[smartcode_project:default project_id=90059 project_image_fid=374075]

Wanting to offer a fully customisable home, Pikos is offering Skye One as a blank canvas, allowing the buyer to work alongside the developer's design team to customise the home's layout, finishes and internal spaces.

The residence will feature a 247 sqm private rooftop terrace with its own swimming pool, sauna, steam room, outdoor kitchen and multiple entertaining areas overlooking the Brisbane River and CBD skyline.

The remaining four penthouses have been completed and are ready for immediate occupation, each offering four bedrooms, expansive open-plan living areas, soaring ceilings and private lift access.

[smartcode_project:default project_id=90059 project_image_fid=374059]

One of the defining features throughout the project is its use of Roman Classic Travertine, with more than 20,000 sqm of the natural stone imported from Italy after being personally selected by Pikos Group Founder and Executive Director Pedro Pikos, interior designer Julie Williamson and third-generation stone specialist Mario Caucci.

Pikos said the penthouse collection represented the culmination of the company's long-term vision for Skye.

"True legacy isn't measured by what we build today, but by what endures tomorrow," Pikos said.

"Our ambition is to create places that become more valuable with time, enrich the lives of generations, and stand as timeless landmarks long after we've stepped away."

[smartcode_project:default project_id=90059 project_image_fid=374060]

Williamson said the interiors were inspired by the natural character of Kangaroo Point and the Brisbane River rather than international design trends.

"Materiality tells the story of a place," Williamson said.

"We looked to the movement of the Brisbane River, the texture of the cliff face and the warmth of the surrounding landscape to create interiors that feel understated, enduring and unmistakably Brisbane."

Positioned above the Kangaroo Point cliffs, Skye places residents within walking distance of Howard Smith Wharves, South Bank and James Street while offering uninterrupted river and city views.

[smartcode_project_cta:default project_id=90059]

Brisbane's next apartment price record? Pikos unveils Skye's exclusive penthouse collection

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?

When buying an apartment, most people compare the big-ticket items first. Floorplans. Kitchens. Balcony size. Natural light. The view.

But there's one everyday consideration that often doesn't come up until after moving in: how parcels are delivered.

As online shopping has become part of everyday life, parcel deliveries have shifted from an occasional event to a regular occurrence. Australians spent a record $82.6 billion shopping online in 2025, with almost one in every four retail dollars now spent digitally.

For apartment residents, that can present a challenge.

If nobody is home to accept a delivery, parcels may be redirected to a nearby Post Office, left in a building lobby or common area, or require building management to step in. In higher-density buildings, where dozens or even hundreds of residents may receive deliveries each day, parcel management has become an increasingly important part of everyday living.

That can create a range of frustrations. A missed delivery often means making time to collect a parcel elsewhere, while packages left unattended in foyers or mail areas can create clutter and increase the risk of theft. What seems like a minor inconvenience can quickly become a recurring issue for residents who shop online regularly.

It's one of those details that rarely features in a display suite but can have a noticeable impact once residents move in.

As a result, buyers are beginning to look beyond traditional apartment features and consider how a building supports day-to-day convenience, including whether there are secure options for receiving deliveries.

Australia Post's Parcel Lockers provide one solution.

<iframe allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" allowfullscreen="" frameborder="0" height="315" referrerpolicy="strict-origin-when-cross-origin" src="https://www.youtube.com/embed/CkF2oKmlACg?si=C50sDaoUUn2nuLmq" title="YouTube video player" width="560"></iframe>

Rather than having a parcel delivered directly to an apartment, eligible deliveries can be sent to a nominated Parcel Locker. Once the parcel arrives, residents receive a notification through the AusPost app or SMS and can collect it using a QR code or one-time PIN at a time that suits them.

The Parcel Locker network now includes more than 1,500 locations nationwide, with installations at Post Offices, shopping centres, transport hubs and an increasing number of residential developments. By providing a secure collection point, Parcel Lockers help reduce missed deliveries and avoid parcels being left unattended in common areas.

For developers, parcel infrastructure is becoming another way to improve the resident experience. Rather than relying on concierge staff or leaving parcels in communal spaces, secure collection points help streamline deliveries while preserving the presentation and functionality of shared areas.

For buyers, it's a reminder that the best apartment features aren't always the most obvious.

A generous floorplan or quality finishes might help narrow the shortlist, but the conveniences that simplify everyday life, whether that's EV charging, secure bike storage or reliable parcel delivery, often become the features residents appreciate most once they're living there.

The apartment feature many buyers don't think about, until their first missed delivery

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The Town and Country Hotel at St Peter's Sydney, immortalised in the Duncan song by Slim Dusty <a href="https://www.mq.com.au/pol/property/search.asp?f_propertyID=1658313&amp;xsl=4468&amp;f_st=1&amp;f_ct=12&amp;f_ps=2">has been listed for May 24 Manenti Quinlan auction</a>. The hotel is on Unwin's Bridge Road.
Agent Gerry Quinlan expects $2.5 million plus for the property.
It comes with 15 poker machines and potential redevelopment possibilities. The song was actually written by Pat Alexander seven years before it topped the charts in 1981 for two weeks.
Alexander wrote the song had come out of an experience while selling life insurance.
"I love to have a beer with Duncan, I love to have a beer with Dunc. We drink in moderation, and we never, never ever get rolling drunk. We drink at the Town and Country, where the atmosphere is great. I love to have a beer with Duncan 'cause Duncan's me mate."
Alexander sent one of his discs to Slim Dusty's post office box address and it was his wife, Joy McKean, who happened to play Duncan, and liked it.
Soon it was pressed by EMI as a single, and in November 1980, Radio 2UE listeners heard John Laws play it eleven times on the first morning.
 
 
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Town and Country Hotel of Slim Dusty song Duncan fame listed

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The reason that many property investors get themselves into financial distress or do not maximise their returns on property investments is that they do not treat their property investment as a business. Three basic rules must be followed: 
Use an expert 
The number-one rule is to use experts in your team. 
Using a property expert to help you buy a superior property can effectivelly get you a “free” property. This is because a superior property growing at an average 10% annually over a cycle will double in value seven years earlier than a property growing at an average of, say, 5 %.

Working with an expert property accountant will advise you on all possible expenses to claim and help you determine whose name the property should be bought in. As an example, using superannuation can allow investors to buy property and claim negative gearing against their income that will later have zero tax on income or capital gains. 
It is surprising how many investors ignore or worse miss out on these opportunities. 
Manufacture equity 
The number two rule is: do not only rely on the market to give your market growth. Manufacture your own equity by buying a property that you can renovate. This will add both capital gains and rental benefits. 
Create a safety net 
The third rule is to create a safety net for the unexpected (interest rate increases, loss of tenant, major repairs, loss of job, etc.) so you do not have to rely on your wages to fund your property expenses. The safety net can come from access to equity to fund the unexpected. 
We call this a buffer, and it must be part of what your finance professional sets up for you.
Ken Raiss is a certified accountant and director of <a title="Chan &amp; Naylor " href="https://www.chan-naylor.com.au/" target="_self">Chan &amp; Naylor</a> national accounting firm. Ken’s experience lies in working with large publically listed multi-national companies, which gives Ken excellent insight into international market trends. Ken specialises in educating “mum and dad” property investors and small business owners with advice on wealth creation, asset protection, taxation, superannuation and compliance.
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Three basic rules to maximise returns on property investment

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During times of slower property price growth, let’s be honest, property investors count on rising rents to boost their investment returns. 
The fact is, since the beginning of 2006 rental growth across the combined capital cities has outpaced the growth in home values. 
Rents outpaced capital growth 
The following table from<a href="https://www.rpdata.com.au" target="_blank"> RP Data</a> shows that over the last six years, capital city home values have increased by 34.5% compared with rental rates, which have increased by a total of 46.8%.
Click to enlarge
<a title="Click to enlarge" rel="shadowbox" href="/images/stories/yardneyapril26.gif"><img src="/images/stories/yardneyapril26thumb.gif"></a>
Nationally, rents have grown about 5% over the last year, with vacancy rates generally sitting below 2% due to strong demand from tenants and a limited supply of properties. 
The rental markets are fragmented
 
Currently the Sydney, Perth, Canberra rental markets are particularly strong due to a low level on construction of new accommodation and this is expected to place an upward pressure on rentals. 
On the other hand, while rents are still rising in Melbourne, Adelaide, Hobart and Darwin, the markets are not as tight. 
According to Gerard Haines, department head of Metropole Property Management Sydney, his team in Sydney is experiencing strong demand from tenants, particularly in the inner west, where vacancy rates are less than 1%. 
“This region is gentrifying and there is a strong demand from a wide demographic of tenants who want to live close to the CBD in these up-and-coming lifestyle suburbs.” 
“There is also strong demand and restricted supply in Sydney’s eastern suburbs, and rents are likely to keep rising in these areas,” says Haines. 
Peter O’Brien, head of Metropole Property Management in Melbourne, tells a different story. 
“While the overall vacancy rate in Melbourne as reported by the REIV is around 2.4%, and there is strong demand from tenants for well located properties in Melbourne’s inner and middle ring suburbs, there are some pockets of Melbourne where the vacancy rate is double that and tenants have the upper hand. This is because there is abundant supply following a period of over exuberant construction by developers,” says O’Brien. 
<a href="https://www.sqmresearch.com.au/" target="_blank">SQM Research</a> reports a vacancy rate of around 8% in some western Melbourne suburbs such as Point Cook, Tarneit and Melton. 
The Melbourne CBD is also suffering with an oversupply and the situation is likely to become worse with an estimated 5,000-7,000 apartments coming onto the market in 2103, with many of these in high-rise complexes. 
To make matters worse, according to Charter Keck Kramer, there are currently 17,860 apartments under construction in Melbourne, with another 16,850 apartments still being marketed across Melbourne. 
Competition for tenants from these projects, which have mainly been bought by investors, is likely to put a lid on CBD rental growth. 
Rental growth is slowing
 
The latest figures from <a href="https://www.apm.com.au" target="_blank">Australian Property Monitors</a> show national weekly rents for houses remained steady for the first three months of the year and rents for units fell 1.1%. 
While asking rents dropped in Melbourne and Adelaide, some rental markets are still performing strongly according to APM. 
Year-on-year rent growth was highest in Darwin (+11.8%), Perth (+3.9%), Brisbane (+2.7%) and Sydney (+2%). 
The bottom line
 
We are at that stage of the property cycle when capital growth is slower and rental growth is strong. But the divergent performance of our rental markets just goes to remind us that buying the right property in the right location is, as it always has been, the key to successful investing. 
For your property investment to perform well in the long-term you need to own the type of property that will be in continuously strong demand by a wide range of owner-occupiers (who will push up the price of similar properties in the area) and tenants (who will pay you rent).
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.
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This could be the year of rental growth

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One of the great mysteries of real estate is the lack of strong rental growth in a land that allegedly has a chronic housing shortage crisis.
The latest rental report from Australian Property Monitors – which covers the eight capital cities – records falling rentals in some markets, zero growth in most and small increases in a few.
The only market to deliver rent rises consistent with the so-called dwelling shortages is the Darwin housing market.
Everywhere else in capital city Australia, it’s all about stagnation. This mirrors recent results with house and unit prices.
How can that be in an under-supplied market?
Here’s the answer: the shortage claims constitute the number-one furphy in Australian real estate.
Economics 101 tells us that where there’s strong demand for a product which is in short supply, prices rise. If prices are not rising, then we can conclude that demand is weak and/or that there is plenty of supply. Or that the normal laws no longer apply.
There are a few places around Australia that do have genuine shortages of dwellings. They’re not the capital cities – they’re in the regions, primarily those where life is all about the resources sector.
Gladstone has a genuine shortage and rents are increasing is significant increments. It’s become a major issue in the Queensland industrial city, particularly for households that aren’t earning the big money in the resources-related projects.
Mining towns in Queensland’s Bowen Basin like Moranbah have had rents rising so high that typical rental yields have topped 15% – a number I haven’t seen in my 30 years researching Australian real estate – prompting BHP Billiton to spit the dummy and refuse to pay the $2,000-plus weekly rents the market is demanding.
In Port Hedland and Karratha, which service the iron ore mining projects of the Pilbara region in WA, typical weekly rents are around $2,000 a week. The federal inquiry into the use of fly-in-fly-out workers has been told that it costs major mining companies $100,000 more annually to accommodate a worker in Port Hedland than it does to fly them in from Perth for regular work shifts.
That’s the outcome you get when there really is a shortage of dwellings and strong demand.
But we’re not seeing anything like that in our capital cities.
The APM Rental Report finds that in the March Quarter there was no change to house rentals in Sydney, Melbourne, Brisbane or Perth, plus a small decline in Adelaide and a 2% drop in Canberra.
Darwin and Hobart were the only cities to record increases in house rents in the quarter.
There was an even more mediocre outcome with unit rents: declines in Sydney, Canberra and Darwin, plus no change in Melbourne, Brisbane, Adelaide, Perth and Hobart.
Looking at house rents on a yearly basis, Melbourne and Adelaide both recorded small declines. Sydney, Brisbane, Canberra and Hobart each had small annual increases between 1.5% and 2.7%. Perth houses rents grew 3.9% and Darwin was the only capital city to show significant movement, with house rents up 11.8%.
There was no meaningful movement in apartment rents anywhere. Hobart’s median decreased, and there was no change in Sydney, Melbourne and Adelaide. There were minor rises, less than 3%, in Perth, Canberra and Darwin. The biggest movement for unit rents was a 4.3% rise in Brisbane.
These are not figures to set markets alight or compel investors to dive in to buy capital city property.
It all reinforces one of my recurring points: that the best places to invest are found outside the capital cities, where prices are cheaper, returns higher and capital growth prospects better. The regions include locations that really do have housing shortages.
Terry Ryder is the founder of <a target="_blank" href="https://www.hotspotting.com.au/">hotspotting.com.au</a> and can be <a target="_blank" href="https://www.twitter.com/hotspotting">followed on Twitter</a>.
 
 
 
 
 
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The so-called chronic housing shortage is the number-one furphy in Australian real estate: Terry Ryder

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Canberra house prices fell sharply in the second half of 2011, though the market performed better than Melbourne, Brisbane and Perth.
SQM Research director Louis Christopher expects Canberra house prices to fall further in 2012.
“There will be no major recovery in house prices in 2012. Stock levels are rising, though they are not as high other cities,” he says.
<img src="/images/stories/clockcanberrahouses.jpg">
Time: 5.30
The Canberra market is heavily reliant on demand for housing from civil servants, and Christopher warns that if the government tries to get the budget back in surplus by cutting back the civil service this could be bad news for the property market.
Century 21 chairman Charles Tarbey similarly observes that “the uncertainty of the Labor government’s position could see the property market [in Canberra] stagnate for some time”.
Population: 358,000
Median house price: $555,000
House price growth in February 2012: 2%
Annual house price growth to December 2011: -2.5%
Annual house price growth to July 2011: 3.8%
Rental yield: 5.8%
 
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Canberra house market at 5.30 amid uncertainty: Experts

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44 Timbs Street, Ulladulla, NSW, 2359
<img src="/images/stories/timbsst.jpg">
The tenants of this three-bedroom house are paying $270 per week and are on an expired lease. Raine &amp; Horne listing agent Lyn Chambers says this is at market rent, and the tenants are keen to stay on. The property is close to walking tracks and parks, and the 807-square-metre block includes a garage.
Chambers <a href="https://www.propertyobserver.com.au/https://www.raineandhorne.com.au/properties/209254" target="_blank">is marketing the property </a>with price hopes of $250,000 plus. If it sells for $250,000 that would secure an investor a gross rental yield of 5.6%, significantly above the indicative gross rental yield of 4.4%, 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.
<a target="_blank" href="https://calc.washingtonbrown.com.au/wbdcalculator/calculator.aspx?RID=HPCAZOPTTT">Washington Brown</a> estimates the first-year tax depreciation deduction to be $6,000 and over five years to be $18,000.
The median house price in Ulladulla fell by 9.7% in the past year, according to RP Data.
The property will go to auction Saturday, April 28 at 11am.
For more about prices and yields in <a target="_blank" href="/news">Ulladulla, see the RP Data suburb page</a>.
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Friday form guide: Yields of up to 5.6% in Ulladulla

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Today I am going to dive into two controversial issues: whether the RBA “should” cut rates by 25 or 50 basis points next week, and what I call the “great RBA counter-factual”. That is, what Australia’s inflation rate would have looked like had the RBA not made its many purported policy “errors”.
Let’s deal with the second issue first. You have to pity our inflation-targeting central bank. You get consistently high underlying inflation, and you get slammed. You do the job you were given, lift interest rates, and allow the currency to appreciate (as you expected), and you get some low inflation. Just what you were shooting for.
And, by the way, “low inflation” is not something Australians are used to seeing. It’s not even really that low – still above the bottom of the RBA’s target 2% to 3% per annum band – and when you strip out “internationally traded” good and services, you find that Australia’s “domestic” inflation looks pretty ugly. But you still get slammed again. According to Alan Kohler today, you will be a “bedraggled, hangdog group of economists who shuffle” into your board meeting next week.
Apparently you made a huge mistake delivering what you were supposed to: much lower tradeables inflation, which is the only reason overall Australian inflation has been wrenched back down towards the bottom of your mandated zone.
Yep, because of the RBA’s decisions, Australia’s economic station looks horrific: we’ve had the first mining boom in recorded history without a major inflation outbreak, 5.2% unemployment, interest rates around their long-term averages, business surveys that suggest growth is near trend (as does the unemployment rate), and underlying consumer inflation of 2.2% per annum, which is still above the targets of most other central banks.
There is an enormous amount of circularity in the current debate about Australian inflation and interest rates. Contrary to popular myth, the latest inflation results are not a disaster. They are the very pleasing and expected result of the RBA’s considered policy actions.
Let me put prove this point graphically. If you compare inflation in "domestic" goods and services (called "non-tradeables"), which also happen to be things that we tend to buy more frequently (and are associated with “cost of living” perceptions) with inflation in so-called "tradeables", which are those goods and services that the ABS defines as having their prices determined in global markets, you will see that almost all the reduction in Australian inflation has been driven by these global consumer prices. And the reason these prices have been falling is because of the appreciation in Australia’s trade-weighted exchange rate, which is one of the RBA’s two key policy tools.
This is illustrated strikingly by the blue line in the chart. Overall inflation is a combination of the blue and red lines. What you can see is that inflation in non-tradeables (i.e., domestic items) remains way above the RBA's target, and is in line with its average 3.7% per annum rate since December 2001.
Click to enlarge
<a href="/images/stories/april261.gif" rel="shadowbox" title="Click to enlarge"><img src="/images/stories/april261thumb.gif"></a>
So this is where the debate about interest rates and inflation becomes circular. Those arguing for much lower interest rates, and a much lower currency, are, by definition, comfortable with higher tradeables inflation. A big decline in the currency would reverse-out a lot of the deflationary benefits yielded by the blue line slumping in the chart above. And without this tradeables deflation we would likely have an overall inflation problem, given domestic consumer prices have been expanding at 3.5% per annum.
One of the reasons "tradeables" inflation has averaged only 1.7% per annum since 2001 is because our main trading partners, such as China, were flooding our markets with cheap imports – that is, exporting deflation. This dynamic has slowed due to rising wage costs and inflation in China and India. As the RBA has observed (and I’ve argued here for years), China is now a source of inflation rather than disinflation. That means that in the future, tradeables inflation will likely be higher than it was during the 2000s.
A related question is whether core inflation of 2.2% per annum, or lower, is such a bad thing. What has happened to core inflation in Australia since the RBA began targeting it in 1993? Is there any evidence we’ve had a structural inflation problem?
And, on a more nuanced level, what does the distribution of inflation outcomes since 1993 look like? That is, does the RBA struggle to keep core inflation around the mid-point of its already high and wide (by international standards) 2% to 3% per annum target band? Do we have a bias in Australia towards high rather than low core inflation outcomes?
To try and answer these questions I have started with a chart that illustrates Australia’s core inflation rate on a three-year and five-year moving average basis since 1993. This suggests that during the 1990s and 2000s there did indeed seem to be an upward drift in underlying Australian inflation. The RBA has acknowledged as much, conceding that it finds it hard to forecast high core inflation events. (The same phenomenon was also found in consumer inflation expectations, which is arguably more worrying.)
Click to enlarge
<img src="/images/stories/april262thumb.gif">
A possibly more interesting analysis is to measure the amount of time Australia’s core inflation rate is above or below the mid-point of the RBA’s target zone. I’ve done this for two periods: since 1993 and since December 2001 (i.e., after the introduction of the GST) in my final charts.
The results are remarkable. Over the last decade plus, core inflation in Australia has been above the mid-point of the RBA’s target 2% to 3% band an extraordinary 92.9% of the time. It has been above 3% per annum an equally amazing 33.3% of the time. It has been below the mid-point only 7.1% of the time. And since 2001 it has never been less than 2% per annum (year-on-year rolling quarterly). That will hopefully change next quarter.
Click to enlarge
<a href="/images/stories/april263.gif" rel="shadowbox" title="Click to enlarge"><img src="/images/stories/april263thumb.gif"></a>
If we examine the RBA’s track record over the full inflation-targeting period of March 1993 to March 2012 we find similar results: core inflation has been less than 2.5% per annum only 35.1% of the time, but above the mid-point 61% of the time (there have been three quarters in which year-on-year inflation was exactly 2.5%).
This strong asymmetry in Australian inflation, whereby it tends to overshoot rather than undershoot the target, is also evident when we look at the top and bottom of the band. Whereas core inflation has been above 3% per annum around 20% of the time over the last 19 years, it has been below 2% per annum only 8% of the time.
Inflation is a tax on your purchasing power and savings. That’s precisely why the central bank’s job is to keep it low and steady. Having a core inflation rate of around 2% per annum when it is being driven almost entirely by tradeables deflation, is a good policy outcome whilst non-tradeables inflation is running at 3.5% per annum.
With that explanation behind us, let’s think about the RBA’s May meeting. The arguments in favour of a 50-basis-point cut are obvious and simple: the RBA’s made a terrible policy error, is now behind the inflation curve, and it needs to slash rates, and pull the currency down, to save trade-affected industries.
Another argument is that the RBA will not want to cut after the budget for fear of being seen to be endorsing the government’s decisions.
The arguments against 50 basis points, and in favour of a one quarter of a percentage point cut, are more nuanced (and accurate). The first is that a 50 basis point move signals the RBA has made a mistake, and undermines its credibility.
A second is that if the RBA wants to genuinely stimulate the economy, it will get more bang for its buck by spreading the cuts out over multiple months and maximising the “jaw-boning” effect.
I’ve talked a lot in the past about the virtual rate hikes we had in 2011 care of the RBA regularly beating the inflation drum, which everyone seemed to accept. The same is true in reverse, but most commentators appear to have forgotten. The media can get the community all excited about interest rate relief in May and June, rather than just in May alone. It’s smart psychology.
A third reason to go 25 rather than 50 is a very poorly understood problem that a big cut creates for the banks. I was speaking to the treasurer of a bank about this issue on Friday. He said to me, “God, I hope the RBA goes 25 and not 50.” I was a little surprised, and asked him why.
He explained that because all the banks have so much retail money tied up in term deposits these days, and because their variable-rate “wholesale funding” prices off the three month bank bill rate, a sudden cut in rates actually damages bank profitability. That’s because the banks cannot immediately reduce all the retail deposit and wholesale funding rates for existing funders.
So, perversely, by cutting 50 you are actually going to encourage the banks to pass on even less to borrowers to save their margins because they cannot immediately reduce their funding costs by the same amount as the RBA’s cash rate change. This bank treasurer argued that all Australian banks will have the same problem.
A final obvious reason to go 25 and not 50 is that you get the benefit of much more information. You get to evaluate the budget, see the next round of unemployment and labour cost data, watch the reaction of the currency, and then re-calibrate your growth and inflation forecasts. And a one month delay is not going to make a material difference to the economy.
Of course, exactly what the RBA does on Tuesday is harder to call. The six business executives on the board will probably opt for the simpler story that says the RBA has to slash rates by 50 to save the economy from low inflation. They would be wrong.
Christopher Joye is a leading financial economist and a director of <a href="https://www.ybr.com.au/savings/index.cfm">Yellow Brick Road Funds Management</a> and Rismark. The above article is not investment advice.
 
 
 
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A 50-basis-point interest rate cut would undermine the RBA’s credibility: Christopher Joye

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The Reserve Bank's economics department had a bad year in 2011, and as a result the board is now high and dry with an official cash rate that is obviously wrong. It needs to come down by 0.5%, to 3.75%. 
In its February 2011 Statement on Monetary Policy, the RBA had a GDP growth forecast for the year ended December 2011 of 4.25% and for June 2012 of 3.75%. CPI inflation for June 2012 was forecast at 2.75%, the same as underlying inflation.
But then in May the bank's economists came over all bullish and upped their GDP forecast for June 2012 to 4.25%, while leaving the December forecast at 4.25%. CPI inflation for June was cut to 2.5%. In August the GDP forecast was up again to 4.5% and while the CPI forecast was left at 2.5%, the underlying inflation forecast was jacked up to 3%.
In November wobbles started to appear and the GDP forecast was cut to 4% and underlying inflation back to 2.5%. In February this year the GDP forecast for June 2012 was back to 3.5% but underlying inflation was actually raised to 2.75%.
So the RBA's economists have made two big mistakes: they got 2011 GDP growth horribly wrong and raised their inflation forecast in February for this financial year even as GDP was falling short.
It's hard to know what came over them on GDP in May last year, but the statement was especially bullish about commodity prices and resource and farm exports. Maybe they were influenced by Treasury, which had a GDP forecast for 2011-12 of 4% in the May budget last year, which has also turned out to be wildly wrong, leading to a bigger than expected deficit (by almost $10 billion).
But why the RBA felt the need to be more bullish about economic growth than Treasury in the middle of last year will probably have to remain a mystery, but that rush of blood to the head in May is still dogging the Reserve bank governor, Glenn Stevens and his board.
With GDP growth of 3.5% and underlying inflation of 2.75% in their February SMP forecasts for 2012, the board could hardly cut rates then, no matter how hard the business people on the board were arguing for it.
The minutes for the April meeting drily say: "Members noted that the national accounts for the December quarter had shown an increase in real GDP of 0.4% in the quarter and 2.3% over the year, which were both lower than expected."
Well, yes, that's an understatement – as recently as November the economists were forecasting 2.75% growth for 2011; just six months earlier they'd been forecasting 4.25%! That's almost twice reality.
One can imagine a fierce debate in the April meeting between the business people and the economists, with the latter clinging to the last shreds of their dignity. In the event they persuaded the board to wait for the March quarter inflation figure before cutting rates and hanging them out to dry.
Kerplunk! March quarter CPI inflation was 1.6%, against last November's forecast for the year to June of 3.25% (there wasn't a forecast for the March quarter). By February that had been slashed to 1.75%, but even that now looks too high.
Next Tuesday it will be, or should be at least, a bedraggled, hangdog group of economists who shuffle into the RBA board meeting for their presentation. And many of the board members may well be checking their emails while it's going on, having already made up their minds to cut rates by 50 basis points.
Which is what they should do.
This article originally appeared on <a href="https://www.businessspectator.com.au/" target="_blank">Business Spectator.</a>
 
 
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The RBA has egg on its face and needs to cut rates by 50 basis points: Alan Kohler

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Lindeman Island in the Whitsundays has been bought by William Han, chairman of China-based White Horse Australia Holdings Pty Ltd and non-executive director of Western Australia's Padbury Mining, for around $12 million.
Han has plans to redevelop the island, but it could be up to two years before Lindeman Island reopens.
Han acquired the resort island from French chain Club Med, which bought it for $15 million in 1990 and had spent the last two decades developing and upgrading the location.
Club Med shut the resort down in January due to a mixture of poor visitor numbers, burdensome regulation and a turndown in the leisure travel market, one industry representative has said.
Han saw off a number of strong bids including interest from mining magnate Clive Palmer and other Australian high-net-worth individuals.
CBRE Hotel’s Wayne Bunz, who negotiated the sale of Lindeman Island alongside Paul Nyholt, says it could take between 12 months to two years before it reopens for business.
Bunz and Nyholt also negotiated the sale of <a href="https://www.propertyobserver.com.au/leisure/bedarra-island-sells-to-queensland-s-charlton-hotel-group/2011112252493" target="_blank">Bedarra Island Resort in far north Queensland to the Charlton Hotel Group last year.</a>
Bunz tells Property Observer there was greater interest in Lindeman Island than Bedarra Island because of its proximity to Hamilton Island, which receives about 40 flights per week.
“In the first round we had 11 bids and 200 enquiries,” Bunz says.
“You always do, people come out of the woodwork when an asset like this comes up for sale.”
“Clive Palmer was one of the bidders, and there were also a fair few from Melbourne,” he says.
In a statement Han, who is an Australian citizen, said he would "work hard" to revive the island's fortunes.
"White Horse is now examining how to reposition Lindeman as an attractive tourist destination, but the resort has been through some challenging times," Han said in the statement.
“We are looking closely at a range of options to reinvigorate the island but it will take some time to assess the best way to move forward."
 Han said it was the Group’s intention that the Lindeman development would be run by a professional resort management company.
“We are committed to resort developments that are in harmony with the natural landscape, with high environmental values,” Han added.
Lindeman is a 584 hectare leasehold island which is located on the Great Barrier Reef approximately 40 minutes by air from Cairns International Airport.
The Han family White Horse Group owns a large outdoor advertising network, along with property and resort interests.
Bunz says the new Queensland government’s focus on re-establishing Queensland as leading tourist destination is encouraging more opportunistic investors.
Another iconic Queensland resort, <a href="https://www.propertyobserver.com.au/leisure/sunland-lists-gold-coasts-palazzo-versace-after-company-profits-slump/2012042354413" target="_blank">the Palazzo Versace hotel on the Gold Coast</a>, is also up for sale for $80 million and is expected to be sold to Asian interests.
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Chinese mining tycoon beats Clive Palmer to acquire Lindeman Island, with plans to redevelop

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After last month’s Reserve Bank board meeting governor Glenn Stevens made it fairly clear that if the March quarter inflation numbers were benign the bank would be inclined to cut official interest rates. Well, the numbers are in, inflation is even weaker than was anticipated and the debate has shifted from whether the RBA will cut to how much it will cut. 
With headline inflation of 1.6% and underlying inflation of 2.2% there was nothing in today’s numbers to suggest anything other than that the economy is continuing to weaken. 
Consumer spending is at recessionary levels, the housing market is in a similar state, job losses in the manufacturing sector are mounting, the impact of the continuing (albeit tapering) boom in the resources sector isn’t flowing through to the rest of the economy and Wayne Swan is about to attempt to pull about $40 billion out of the economy, or 2.5% of GDP, if not more. Some of that may be done with "smoke and mirrors" but it isn’t going to be possible to achieve those sorts of numbers without real and very substantial cuts in expenditures and increases in government revenues. In the circumstances, the horror budget that is looming can’t be considered as anything other than a major depressant on an already weakening economy. In that context, a reduction in official interest rates next Tuesday appears inevitable. The larger question, however, is whether that would be sufficient to blunt the negative influences now pervading the economy. It is a question complicated by the RBA’s need to second-guess the responses of the major banks to a rate cut, given that there is a probability that they will retain at least some proportion – perhaps 10 to 15 basis points – of any reduction.  Led by ANZ, the banks have to a degree de-linked their mortgage and deposit rate movements from the RBA’s decisions and they have been making it plain that they are continuing to experience the funding pressures that have caused them to pass through rate cuts lower than the movements in official rates since the onset of the financial crisis. If the RBA cuts the cash rate by 25 basis points next week and the banks pass on only 10 to 15 basis points of it, would the decision have any meaningful impact on the economy and the psychology of consumers and businesses? One doubts it. That’s why there are plenty of people now focusing on the prospect of a 50 basis point reduction in the cash rate, which would allow the banks to retain their 10 or 15 basis points while still enabling a meaningful reduction to flow through to borrowers. No doubt the RBA staff has been in close contact with the major banks to make sure they understand their likely responses to a cut. The RBA has made it clear that it does take the anticipated reaction of the major banks to rate movements into account when deciding whether to move the cash rate and the size of the movements. It is concerned not about the level of the cash rate per se, but the influence it has on the actual rates being charged borrowers. The one issue that might make the RBA cautious about the size of any reduction would be the looming federal budget. It might want to see the nature and quality of Swan’s budget measures – how "real" they are – before moving more than the usual 25 basis points. However, with commodity prices and the terms of trade now off their peak, China slowing, Europe still wobbling, swelling question marks over some of the biggest of the new resource projects in the pipeline, the non-resource economy slowing discernibly from already weak levels, households confronted with rising utility costs and the carbon tax imminent, if the RBA doesn’t lop 50 basis points off the cash rate next week the probability is that there will be a succession of rate cuts between now and the end of the year.
This article originally appeared on <a href="https://www.businessspectator.com.au/" target="_blank">Business Spectator</a>.
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