<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]

Joel Robinson

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

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;

[smartcode_project:default project_id=111820 project_image_fid=344699]

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.

[smartcode_project:default project_id=136442 project_image_fid=374084]

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.”

[smartcode_project:default project_id=134954 project_image_fid=4553]

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>
	<li>Proven at scale:&nbsp;Decennial cover has operated in NSW since 2022, protecting thousand of apartments.</li>
	<li>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>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>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>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>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>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>
	<li>Resilience Latent Defects Insurance (LDI):&nbsp;Covers major structural defects for 10 years from completion.</li>
	<li>Consumer-first:&nbsp;Direct claim access, no need for lengthy legal action.</li>
	<li>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>Market leader:&nbsp;&nbsp;Resilience Insurance originated LDI in Australia and is the national market leader.</li>
</ul>

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

Prominent New Zealand apartment and hotel operator, <a href="/developers/safari-group">Safari Group</a>, is offering up a prime investment opportunity for Australians to purchase off the plan in one of the world’s most popular ski destinations.

They recently took to market Mountain Oak Queenstown Apartments, in the growing precinct of Remarkables Park in Frankton, near the airport and at the foot of The Remarkables - the mountain range the locals like to call “The Remarks”.&nbsp;

Sydney investors have shown interest in the one, two and three-bedroom apartments that secure high-season occupancy six months over the year, primarily over summer and winter months.

They average 90 per cent occupancy across their portfolio over January, February, March, August, November and December, while shoulder season months of April, July, September and October are still occupied 70 per cent of the time, with the growing appeal of Queenstown becoming not just a hotspot for the snow, but a lifestyle destination.

Even in the low seasons of May and June, occupancy levels reach around 40 per cent.

<img alt="Safari Group’s Mountain Oak Apartments brings new investment potential to Queenstown" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/f_auto,c_limit,w_1440,q_auto/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/field/image/Ext_Cam15_Sunny.jpg?VersionId=SJAROUM_1s.Tr5ciMk4EEj5oAt_Vewmv" />

Safari’s Safari Hotels arm can also manage the holiday letting for an investor, from the listing on holiday accommodation websites such as Airbnb and Booking.com to the cleaning and maintenance of the investment. They’ve been in the short stay management business for 15 years and offer 24/7 support for investors, an important convenience benefit for any overseas investor

Another major drawcard for Australians is that New Zealand doesn’t have a stamp duty policy - so the entry price of NZ$639,000 (AU$586,000), is all that is payable on completion.

<img alt="Safari Group’s Mountain Oak Apartments brings new investment potential to Queenstown" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,dpr_2.0,q_auto:good/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/313_Livingv2_WEB.jpg?VersionId=nV229fM0ZeYpoxOrX372HyGjfwY_LR8c" />

Safari is starting construction of the 141 apartments in Q2 this year, with a two-year build estimated to complete in mid-to-late 2027.<img alt="" data-entity-type="" data-entity-uuid="" height="15" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXczFpFAb7WuA6f4f9TtKWcqXyNwR8qqtakWv352ERkpqNlP3KwIo8YKxw67jZNHfpjEGIZGv5MQTbnvLZwNt8iu9IVdOrswOjCvBZ4zhSoOOLrpt6etVEZTN1gkBho0r_R72zdHNA?key=yq3daOanqHSb88QFd8jGYKdb" title="Click and drag to move" width="15" />​

The apartments will feature modern amenities and contemporary designs with expansive windows capturing sweeping views of The Remarkables mountain range.&nbsp;

Interiors are equipped with modern finishes, premium appliances, and secure electronic key-locked doors, ensuring a comfortable living experience for residents and guests alike.

With its strategic location near Coronet Peak and Cardrona Alpine Resort, as well as key retail and dining precincts such as Market Street, Five Mile Shopping Centre, and Remarkables Market, Mountain Oak offers a strong proposition for investors seeking high rental yields and capital appreciation in one of New Zealand’s most sought-after locations.&nbsp;

Queenstown’s sustained demand for visitor accommodation and rental properties is underpinned by a shortage of housing options, attracting both local and international buyers.

Safari Group offers low-touch investment proposition in Queenstown’s popular ski fields district

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The latest housing data has confirmed News Limited economist Stephen Koukoulas’s belief that house prices will rise around 10% in 2013. 
Adding to this data, Koukoulas believes that a trifecta of factors - low interest rates, high immigration and improved affordability – make such a price rise "close to certain”. 
Speaking on the ABC's Inside Business yesterday, Koukoulas said he thought house prices were set for a strong up trend.
"We have had a bigger improvement in affordability in the last two to three years following what was clearly excessive house price growth up until the last few years.
"We have about 12% wages growth, house prices are about 5% off their peak and interest rates are very low, so affordability has improved dramatically," he says.
Helped by growing migration and a lack of houses being built in the past, he expects housing to do "particularly well".
January housing data released by RP Data has house prices up 1.2% over January with all the major capital cities recording gains over the month, <a href="/news">led by Brisbane, Perth and Sydney</a>. 
Also last week, The Housing Industry Association’s reported new home sales rose 6.2% in December after rising 3% in November and 3.6% in October. 
“That is a thumping 13% lift in sales in the final three months of 2012, an impressive lift after home sales were in the doldrums around the middle of last year,” said Koukoulas in his latest column for Business Spectator. 
Other signs that housing is on track for double-digit growth in 2013, says Koukoulas is home building approvals (indicators of future construction) are lifting. 
“From the low in April 2012, the number of approvals has lifted more than 20% which points to the housing making a decent contribution to GDP growth, he said. 
Koukoulas also points out that the share price in companies related to the home building industry “have skyrocketed in recent times” including building materials provider Boral up 60% since the middle of 2012 and commercial property developer Leighton Holdings up nearly 50% over the same period. 
“The housing sector is set for a strong performance in 2013. 
“There are likely to be strong rising house prices, higher home sales and a lift in construction," he says.
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lschlesinger-FZcF9M3vE6

House prices to rise 10% this year as part of upward trend: Koukoulas

<html><body>
Mortgage lender RAMS has waived application fees and settlement fees for first-home buyers as part of a new campaign aimed at helping them move from renting to buying.
The campaign is being promoted by a new television commercial, which aired for the first time last weekend.
RAMS has also waived the account keeping fees on its RAMS Low Rate Home Loan with Introductory Rate Option, during the introductory rate period.
According to the lender, this could save first-home buyers up to $1,590 in fees.
“We understand the frustrations of FHBs who tell us they are in a rental rut and are delaying purchasing a property due to their inability to afford repayments and fears of unemployment in an uncertain economy," says RAMS chief executive Melos Sulicich.
“We have listened to their concerns and created genuine options designed to renew first-home buyer confidence and reignite their passion and drive to take the first step to home ownership."
RAMS says it is also helping first-home buyers by requiring only a 5% deposit with a full-doc loan (plus funds to cover transaction costs), if they meet our other lending criteria.
The lender has also cut its two-year fixed rate from 5.39% to 5.25%.
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RAMS waives fees for first-home buyers

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The “wide gulf” that exists between prices and rents suggests that housing in Australia is overvalued, argues Deakin University researcher and housing bubble proponent Philip Soos.
Soos points to RP Data’s most recent Buy vs Rent, which he says shows that unless you’re willing to buy in remote or unattractive locations, it’s cheaper to rent then own property.
The RP Data report found that out of 5,230 suburbs, there are 388 suburbs that are cheaper to buy than rent based on a standard principle and interest home loan. This rises to 1,031 suburbs if borrowers are willing to pay an extra $50 a week in mortgage repayments.
While a more realistic study would factor in costs such as "maintenance, council rates, water and sewerage, land tax, body corporate levies, stamp duty, and legal and conveyancing fees"  Soos says it does provide some evidence to suggest a "confirmation of overvaluation in the residential real estate sector, that is, the market price of property is significantly greater than future rents capitalised”
As further evidence of this claim, he points to the rising <a target="_blank" href="https://www.businessspectator.com.au/bs.nsf/0bd6ea4d7e0e401eca257300000473fc/dbccae23bff9983eca257b03007e58e6/bodyrich/0.1218!OpenElement&amp;FieldElemFormat=gif">ratio of real house prices to rents</a> which have increased by 64% from trough to peak (1997-2007) with some moderation recently due to falling housing prices and rising rents in the last two years.
Currently the ratio is about 160% (house prices to rents) and Soos says it serves as one of many indicators to determine possible overvaluation in the real estate sector.
“It comprises a valuable metric and thus should not be ignored,” he says.
According to Soos, this divergence between house prices and rents suggests “confirmation of overvaluation in the residential real estate sector, that is, the market price of property is significantly greater than future rents capitalised”.
Furthermore, he says it indicates the Australian property market is not operating in an efficient manner.
“Conventional economic theory stipulates that, in an efficient property market, the all-in risk and tax-adjusted cost of purchasing a property should equal the cost of renting it,” writes Soos in a column for Business Spectator.
“If buying is dearer than renting, then supposedly rational individuals will change their preference by selling, taking the profit, and renting, driving down housing prices until the cost of buying equals the cost of renting,” he says.
Soos says what is driving up the difference between house prices and rents is “debt-financed speculation”.
While rents are determined by wages and what tenants can afford to pay, capital values are driven by banks willingness to provide finance to home owners and investors “limited only by lending regulations (if banks choose to observe them) and borrowers’ ability to service the mortgage repayments”.
 
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Disconnect between rents and house prices suggests housing is overvalued: Philip Soos

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Due to the lengthy forewarning of the September federal election, the election is unlikely to have a detrimental effect on the property market, according to Leanne Pilkington general manager of Laing+Simmons.
Pilkington says September is usually the month the market picks up due to the weather warming up, and the election date may cause a slight delay in spring campaigns being launched.
Although Pilkington says any potential delay will be short lived.
“It could be argued that a September election is preferable to October or November, as once the election outcome is finalised, the spring selling period can move into full swing,” says Pilkington.
“Buyers will still feel they have time to make a considered purchase and vendors need not rush to accept prices lower than their expectations.”
“In the five to six weeks leading up to an election, which is a more typical campaign timeframe, we would expect to see the market slow down until an outcome is finalised, as buyers take a wait-and-see approach and sellers react accordingly,” she says.
Pilkington also says both buyers and sellers will be eager to understand the policy positions of the Government and Opposition as they relate to the property market.
Depending on the policies announced, Pilkington says the election might have the effect of bringing forward demand before September 14 or delaying activity until an outcome is known.
First homebuyers are the main section of the property market that will be impacted by an election outcome, as grants and incentive programs are targeted at this buyer category.
Pilkington also says that vendors whose properties suit this buyer profile will be equally interested.
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ntrotman-Et3xWpamVh

September election unlikely to have a detrimental effect on the market

<html><body>Leading Sydney estate agent ?John McGrath<a href="https://www.facebook.com/public/John-McGrath" target="_blank"> has listed on his Facebook page</a> the 10 reasons why he believes the residential market will be 5% to 10% higher by the end of 2013.   1. The Australian share market is recovering quickly, and this will generate (and replenish) great wealth for many Australians.  2. China is on the surge with an 8% anticipated growth rate this year (and beyond), and we will benefit more than any other country.  3. We have record low interest rates, with existing and new borrowers reaping the benefits making property more affordable. 4. We have a nationwide housing shortage and will for some time, so demand will outstrip supply in an improving sellers market. 5. Cash and term deposits are becoming far less attractive, and many people will see the time is right to switch from cash into growth assets.  6. Rents will continue to climb in the face of the housing shortage providing investors increasing yields over the next few years.  7. Self-managed super funds (SMSF) investing directly in residential property is the biggest change I’ve seen in the last 12 months 8. Luxury homes are back by 20%-40% in value and will provide great buying for the recovering professional market buyers (read <a href="/news">Palm Beach</a> weekenders are about to become mega popular again!).  9. Most experts are tipping a landslide change in federal government, which will give great confidence to the business community. 10. As all the above happens in our connected community we’ll see a surge of confidence and FOMO (fear of missing out), which will stimulate continued investment over the next three- to five-year cycle.</body></html>

The 10 reasons why Australian property prices will rise 5% to 10% in 2013: John McGrath

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Over the years, I have discovered that successful investors do things in a certain way that helps them become rich, while others continue to do things differently and in general they tend to struggle.
I’ve come to the conclusion that when you do what most successful investors do, you get to become one of them, and if you don't – you won’t.
With 2013 panning out to be another challenging year in property, let’s look at six simple reasons most investors will never get rich and how to make sure you do:
1. Most people wait too long to start
Most people can’t wait to succeed; yet they are willing to wait to get started on the road to riches.
Many investors are waiting for everything to be “perfect” before they get going.
They wait for the right time in the cycle, the right property, the right economic environment or the right interest rates: which means they never get going.
The longer you wait to get started with your investing, the longer it will be before you get the money, success and freedom you want. It takes time to grow real wealth. It takes time for the power of compounding to work its magic.
You need to understand that the timing will never be perfect or you will never have all the information you want. You need to develop the confidence to make an investment decision based on knowing enough and realising that you will learn the rest along the way.
2. Fear stops them
Fear keeps many of us from getting what we want, especially in matters of money.
Be honest with yourself and count the number of times fear has prevented you from taking action, and in the process cost you a lost financial opportunity.
In the matter of property investment, fear holds many investors back.
Some fear taking on more debt, others fear failure and some even have a fear of success (will my friends still like me?).
Successful investors have learned to harness their fears and rather than focus on the negatives, they use fear to force them into positive action.
For example, rather than allowing fear of debt to stop them taking on the commitment of buying a property they use the fear of not moving forward with their investments to motivate them.
They use the fear of being stuck in their job for the rest of their lives, without the financial independence that they are craving, to motivate them to take on the commitment of an investment property.
Money and success lives on the other side of fear.
3. Waiting until they know enough
The fear of not knowing enough prevents other investors from getting started.
However, the irony here is that the more you learn, the more you learn you don't know!
Once you start learning some basic investment concepts you suddenly realise there are a whole lot more things about investing or property that you don’t understand.
That's the paradox of knowledge: The more you learn, the more you learn you don't know.
The trap is that many investors think that the way to escape this paradox is to learn even more, so they read more books, go to more seminars, listen to CDs and watch DVDs.
As they learn more they find a whole heap more things they don’t yet know.
The key is to recognise that while you don't know it all, and you never will, you do know enough to get started with your investing and you will learn more along the way as you apply your knowledge in the real world, surviving any mistakes and challenges along the way.
 
<hr class="system-pagebreak">
 
4. Focusing on linear income instead of passive income
It is important to realise that not all income is created equal. Some streams are linear and some are passive.
Linear income is what you get from a job. You work for an hour and get paid once for that hour's work, and that's it. If you don’t turn up to work you don’t get paid.
Passive income is when you work once but you continue to get paid over and over again from work you're no longer doing. The way to become wealthy is having passive income coming in whether you go to work or not.
Wouldn’t it be nice to be paid hundreds of times for every hour you work?
That’s what happens to property investors. Initially they work long hours, save up a deposit and then invest it into a property.
Now their money starts working for them and keeps giving them sound investment returns “passively” in the form of capital growth and rental returns. Rather than getting another job, the wealthy people know they need to send their money out to work for them.
To put it simply: if you're not making money while you sleep, you'll never become rich.
5. Not using systems for making money
A system for making money is something that takes the emotion out of your investment decisions and makes the results more reproducible.
My preferred system is investing in high growth property. In particular I invest in high growth properties in areas that are in the upturn stage of their property cycle.
I buy them below replacement cost and then add value through renovations or redevelopment.
I rarely sell these properties. I borrow against the increasing equity in my property portfolio to buy more properties.
Once you create a proven system for making money, there is no limit to the money you can make.
 
6. Not being patient
Warren Buffet once said: “wealth is the transfer of money from the impatient to the patient”.
To become a successful property investor requires patience and persistence. You must not only get started, but you must continue on and follow through.
Residential property is a long-term investment. It’s not a get-rich-quick scheme.
Yet many investors speculate rather than invest. They look for that “big deal” which will land them a jackpot in a short period of time.
In general these types of deals rarely occur and if you find one, it will likely be speculative in nature and riskier.
The problem for many investors is that the successful buy and hold strategy I advocate is boring and others consider it slow. But successful property investment is a long-term affair.
Many investors look for the latest fad or try finding the next hot spot or speculative growth areas. Other investors consider other types of investments with potentially higher returns.
When you are tempted to do this, remind yourself that real estate has been the number one long-term multi-millionaire maker throughout Australia’s history, yet most people that speculate in the latest fads have not made much money.
You don’t have to look for the latest fads or the latest speculative growth areas if you create your own capital growth through buying a good property at a fair price, then adding value through refurbishments, renovations or redevelopments.
By doing this you are manufacturing your own capital growth.
So, it's really quite simple...
Decide to do these six things that successful property investors do and you are much more likely to become a successful and wealthy property investor. If you don't do them, then like most people, you may never get rich.
 
 
Michael Yardney is a director of <a href="https://www.metropole.com.au/">Metropole Property Strategists</a>, which creates wealth for clients through independent, unbiased property advice and advocacy. He is best-selling author, one of Australia's leading experts in wealth creation through property and writes the <a href="https://propertyupdate.com.au/category/property-investment/">Property Update</a> blog. Subscribe today and you'll receive a free video training - The Golden Rules of Property Investment. 
Here’s a bonus reason for you…
Another reason so many investors fail is that they try and do it all themselves. The inconvenient truth is that there is no such thing as a self-made millionaire.
Successful investors build a great team around them and have mentors and models – they learn from people that have already achieved what they want to achieve.
They look for people who give them independent, unbiased advice, and that's what Rolf Schaefer, Mario Borg and I will be doing at my National Property &amp; Economic Update - Outlook for Property Investors 2013 around Australia in March and April.
<a href="https://propertymarketupdate.com.au/">Click here</a> for more details and reserve your seats now.
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myardney-DFoGhGbSJX

Six reasons most property investors struggle and never become rich

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The release of December data from Residex appears to confirm that Melbourne house prices probably went nowhere in 2012.
Residex reports a 1.5% rebound in Melbourne house prices in the final quarter of the year, but with house prices still down 1.4% over the year with a median value $566,000.
Unit prices dropped 1.4% over the quarter to end the year down 4.3%, with a median price of $427,000.
The Residex figures means that two data providers – Residex and RP Data – have Melbourne house prices down over 2012, while two – the Real Estate Institute of Victoria (REIV) and Australian Property Monitors (APM) have them up.
Melbourne houses
<table cellpadding="0" cellspacing="0" border="1"><tbody>
<tr>
<td colspan="4" width="491" valign="top">
House price changes
</td>
</tr>
<tr>
<td width="133" valign="top">
 
</td>
<td width="114" valign="top">
Quarter
</td>
<td width="134" valign="top">
2012
</td>
<td width="110" valign="top">
Median
</td>
</tr>
<tr>
<td width="133" valign="top">
RP Data
</td>
<td width="114" valign="top">
-1.5%
</td>
<td width="134" valign="top">
-2.9%
</td>
<td width="110" valign="top">
$550,000
</td>
</tr>
<tr>
<td width="133" valign="top">
APM
</td>
<td width="114" valign="top">
+2.4%
</td>
<td width="134" valign="top">
+0.5%
</td>
<td width="110" valign="top">
$526,000
</td>
</tr>
<tr>
<td width="133" valign="top">
REIV
</td>
<td width="114" valign="top">
+7.8%
</td>
<td width="134" valign="top">
+4.7%*
</td>
<td width="110" valign="top">
$555,000
</td>
</tr>
<tr>
<td width="133" valign="top">
Residex
</td>
<td width="114" valign="top">
+1.54%
</td>
<td width="134" valign="top">
-1.41%
</td>
<td width="110" valign="top">
$566,000
</td>
</tr>
</tbody></table>
Melbourne units
<table cellpadding="0" cellspacing="0" border="1"><tbody>
<tr>
<td colspan="4" width="491" valign="top">
Unit price changes
</td>
</tr>
<tr>
<td width="133" valign="top">
 
</td>
<td width="114" valign="top">
Quarter
</td>
<td width="134" valign="top">
2012
</td>
<td width="110" valign="top">
Median
</td>
</tr>
<tr>
<td width="133" valign="top">
RP Data
</td>
<td width="114" valign="top">
-2.7%
</td>
<td width="134" valign="top">
-2.5%
</td>
<td width="110" valign="top">
$435,000
</td>
</tr>
<tr>
<td width="133" valign="top">
APM
</td>
<td width="114" valign="top">
+1%
</td>
<td width="134" valign="top">
+2.2%
</td>
<td width="110" valign="top">
$391,000
</td>
</tr>
<tr>
<td width="133" valign="top">
REIV
</td>
<td width="114" valign="top">
+4.2%
</td>
<td width="134" valign="top">
+1.3%*
</td>
<td width="110" valign="top">
$456,000
</td>
</tr>
<tr>
<td width="133" valign="top">
Residex
</td>
<td width="114" valign="top">
-1.37%
</td>
<td width="134" valign="top">
-4.28%
</td>
<td width="110" valign="top">
$427,000
</td>
</tr>
</tbody></table>
*The REIV figures compare December quarter 2012 figures with December 2011 quarter figures. APM and RP Data are annual changes over 2012.
Averaging out the four property data providers indicates, as suggested by <a href="https://www.propertyobserver.com.au/victoria/melbourne-residential-property-market-on-the-mend-property-observer-navigates-the-muddling-median-maze/2013013059037">Property Observer before publication of the Residex figures</a>, that property prices in Melbourne hardly moved in 2012.
The average house price change for Melbourne is 0.2% over 2012 while units fell 0.8%.
Residex had Sydney as the top-performing detached house market over 2012 (up 4.91%) with Perth the strongest performing unit market up 10.89%.
Residex chief executive John Edwards says that overall, 2012 was a better year for Australian property than the previous 12-month period.
“Additionally, the past few weeks will have helped consumers gain higher levels of optimism as there has been positive news surrounding the US economy and little negative news out of Europe. Lifted confidence should flow into higher levels of housing market activity,” says Edwards.
“On the other hand, the floods currently being experienced in Northern NSW and Queensland will be having a dampening influence on these markets. Some slowing in the economy will drive unemployment, which will also have some moderating impacts. However, we shouldn’t get too carried away with moderate increases in unemployment as we are coming off all but full employment.
“On an Australia wide basis, capital growth in the house and land market achieved its best performance in the last 18 months. Weekly rentals also increased, with rentals for houses and land maintaining real value while units outperformed inflation by about 3%. Rental increases are good news and much needed as the sector’s capital value is either stagnant or just maintaining real value. This should be expected to continue,” he says.
<a target="_blank" href="https://blog.residex.com.au/wp-content/uploads/2013/01/Australian-Property-Market-Statistics-December-12.jpg">The full set of Residex results can be found here.</a>
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Melbourne houses and units end year in the red: Residex

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Melbourne and Adelaide will be "the worst-performing markets for house price growth in 2013," according to modelling by the National Australian Bank.
While not anticipated to be in negative territory, they are expected to continue to lag behind the capital city average, with state economic conditions and employment prospects in both these states also expected to remain tougher.
Click to enlarge
<a rel="shadowbox" href="/images/stories/2013/01/nabjan311.gif" title="Click to enlarge"><img src="/images/stories/2013/01/nabjan311thumb.gif"></a>
Source: NAB
Despite relatively subdued credit lending overall, NAB notes the Australian housing market had shown intermittent improvement as the effects of lower interest rates, an uptick in growth in real rents and sound underlying fundamentals had supported recent improvements in house prices.
"With very accommodative monetary policy now firmly in place, another 75 bps of rate cuts pencilled in by NAB this  year and a continuing shortage of dwellings, it is possible that we will see resumption in national house price growth in the years ahead," says NAB. 
"However, job insecurity may act as a constraint during 2013.
"Our modelling indicates that capital city average house prices will rise by around 1½% through the year to end-2013 and 3% in the year through to end-2014, which is slightly higher than <a target="_blank" href="https://www.propertyobserver.com.au/news/australian-house-prices-to-rise-21-over-next-two-years-nab/2013013059038">the average survey forecast</a>."
It notes house price divergence between the states is likely to persist, with the ‘multi-speed’ nature of the Australian economy also "very apparent" across state housing markets.
Perth is tipped to lead the nation in terms of house price growth with capital gains forecast to run at around 3.5% through the year to end-2013 and 5% in the year through to end-2014, underpinned by improved affordability, population growth and above average state economic growth. Sydney (2.1% and 3.7%) and Brisbane (1.7% and 3.5%) also out-perform the national average.
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jchancellor-FAypfDUnLy

Melbourne and Adelaide will be the 'worst' performing markets in 2013: NAB modelling

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Big-box retailing is in full swing in Australia, with the local arm of bulk buying group Costco receiving yet another $50 million from its parent company in order to fund further expansion after reporting its first profit.
The move comes as the bulk buying industry <a href="https://www.smartcompany.com.au/advertising-and-marketing/048283-costco-gets-140-million-from-parent-to-fuel-expansion" target="_blank">continues to expand</a> in Australia, with Costco planning an expansion which will bring <a href="https://www.smartcompany.com.au/retail/050601-costco-to-announce-new-store-within-weeks-aims-at-three-stores-in-sydney-and-melbourne" target="_blank">multiple stores</a> in capital cities across the country. The business received $140 million in 2012 to help open new stores.
But while Costco has made an impressive stamp on the food and grocery market in Australia, some analysts believe it isn't the supermarkets which should be scared. Instead, as companies such as Costco and Aldi expand, experts say it's the wholesale market that should be worried.
"The biggest losers here are the wholesalers," says City Markets analyst Peter Esho. "Costco is a wholesale model rather than a mainstream supermarket."
"It's going to nibble into Coles and Woolworths, and IGA, but I don't think at this stage there is going to be too much impact."
Esho points to Coles' own financial results, released today, which show food and liquor sales increased 3.9% in the second quarter on a like-for-like basis.
New figures lodged with the Australian Securities and Investments Commission show Costco turned a profit of $9.73 million during the year to September 2012, while revenue also doubled to over $609.5 million. According to Fairfax, the Melbourne and Sydney stores generated most of that revenue, a large portion of which comes from membership sales.
Costco Australia managing director Patrick Noone told SmartCompany the business is continuing its expansion plans, and is constantly looking for new locations.
"We're always searching," he says. "Always looking at ways to do things better."
However, he did say the lack of property available for big-box sites has been a challenge. "The lack of availability has been a problem," he says.
The business plans on opening locations across the country, including two or three locations in some cities. Adelaide is a possibility soon, although Noone said a Perth location may not arrive for a while.
The introduction of Costco into the Australian market has signalled a surge of big-box retailing. The local big-box industry has pushed for new laws to help businesses find suitable land more easily, as they require larger than normal sites.
Noone said Costco usually puts its case forward regarding zoning laws - its Auburn location in Sydney suffered some delays due to zoning disputes.
But the expansion of Costco shouldn't make supermarkets feel uneasy, says Esho. He argues the company is playing on a different field.
"I think ALDI is very well placed to defend itself, it has its own brands, exclusive brands, that run on a low cost model and are competitive. I think the impact on ALDI would be minimal."
ALDI has expanded to nearly 300 stores since opening here in 2001. Esho says the main impact will be directed at the German company, along with other wholesalers.
"There might be an impact if wholesaling draws people away from the main supermarkets, where that migration sees people buying at Costco and ALDI for main products instead of Coles and Woolworths."
Wholesalers will feel the pinch, he says. <a href="https://www.smartcompany.com.au/retail/053438-metcash-takes-on-costco-with-launch-of-value-depot-warehouse-stores" target="_blank">Metcash was in a position to be hurt</a>, but the company has already restructured itself in anticipation of Costco's expansion.
Costco Australia managing director Patrick Noone has previously said the business wants to expand with two more stores in 2013. A second Melbourne store in the eastern suburb of Ringwood is currently being constructed.
Esho says despite the expansion plan, the existing grocery market doesn't have a lot to be worried about.
"I don't think at this stage there'll be too much of an impact, at least not at this stage – and it won't for at least a decade."
This article originally appeared on <a href="https://www.smartcompany.com.au/index.php" target="_blank">SmartCompany</a>.
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pmcstafford-pr9eMARWoN

Australian Costco gets $50 million boost and turns its first profit

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Sydney house and unit prices rebounded in the final quarter of 2012 to finish the year at record highs, according to full year figures from Australian Property Monitors (APM). 
Sydney house prices rose by 2% over the quarter to be up 3.4% for the year with the median price rising to a record $656,415, the first time the median price has been above $650,000 and are now $10,000 above their previous peaks.
Canterbury-Bankstown was the top performing region with the median house price increasing 11.5%, however prices did fall on the lower north shore by -0.4%.

Sydney unit prices gained 2.3% over the quarter to be up 5.6% for the year and also posted a record median price of $475,314.
The rises for the quarter were based on upwardly revised September quarter figures. 
APM revised the Sydney’s median house price for the September quarter from $641,890 to $643,578, while the median unit price was revised from $458,562 to $464,572. 
Australian Property Monitors senior economist Dr Andrew Wilson says Sydney again “illustrated the resilience of its housing market”. 
Wilson says the Sydney market revival is being driven from the middle upwards rather than from the top down with changes to first-home buyer grants in 2012 bringing forward demand while change-up buyers also become active.
“We are seeing a lot of activity in the middle price section of the Sydney market between $500,000 and $900,000, and that’s what is pushing up those median house prices to record levels," he said in an interview on AFR TV.
Wilsons says the prestige market in Sydney, which has to date been the ‘weak link” in the market, may also start to grow in 2013.
<img alt="apmjan31" src="/images/stories/2013/01/apmjan31.jpg" width="470" height="294">
Nationally, house prices rose by 1.9% over the quarter to finish the year in positive territory – up 2.1% to a median of $542,299. 
Unit prices increased by 1.6% over the quarter to be up 2.4% for the year with a median price of $417,123. 
September quarter figures were also revised. 
The median house price was revised downward from $533,480 to $532,274, while unit prices were upwardly revised from $406,415 to $410,508. 
All capital cities recording house price gains over the quarter – the first time this has happened since March 2010. 
“I think it is no coincidence that we have historically low interest rates and we are just starting to see a consistent rise in confidence in housing markets," says Wilson.
But he tempered this by saying capital cities and sub-markets are still performing at different levels. 
“We are still seeing the fractured type of outcome."
Sydney is the only capital city market where house prices are above their previous peaks, but APM expects that based on current trends, Perth, Canberra and Darwin will achieve record house prices in 2013. 
Wilson says the property market rebounded “as expected in 2012” on the back of the “general improvement in affordability and confidence” due to record low interest rates fuelling increasing buyer activity. 
Excluding the volatile Darwin market, Perth was the top-performing capital city market over the year, with house prices up 6% over the quarter and unit prices up 6.1% to medians of $560,780 and $365,132 respectively.
Perth’s September median house price was upwardly revised from $537,237 to $547,160, and its median unit price upwardly revised from $348,293 to $352,961. 
Wilson says the Perth price rises are being driven by around 1,500 people arriving each week in Perth and by a tightening rental market and rising rents, pushing more people into the house-buying market. 
Melbourne house prices gained 2.5% over the quarter to end the year just in positive territory – up 0.5% to a median of $526,281 with units up 1% for the quarter but still down for the year at -2.2% and a median of $390,651. 
Brisbane house prices increased by just 0.3% to be down 0.5% for the year (median of $433,302) but Wilson said this small quarterly gain was significant “as it signalled a revival in activity after a lengthy period of price falls”.
Of some concern to investors would be the Brisbane unit market – the epicentre of dozens of new apartment projects – where prices fell 2.7% over the quarter to be down 3.2% for the year, making it the worst performing house or unit market for the year. 
Adelaide continues to remain the most affordable mainland capitals with as median house price of $432,309.   “Looking ahead in 2013 activity will depend on the direction of local economies as it is no coincidence that the better performing housing markets in 2012 reflected better performing economies - particularly in regard to unemployment levels,” says Wilson.
“With a rising share market and an improving international outlook, the general economic landscape and prospects remain optimistic which is unequivocal good news for Australia’s recovering housing markets,” he says.
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