<p><a href="https://www.apartments.com.au/developers/mayd-group">MAYD Group</a> has set a new residential price record in Queensland with the $30 million sale of the penthouse at its <a href="https://www.apartments.com.au/new-apartments/one-burleigh-88-the-esplanade-burleigh-heads-qld-4220">ONE Burleigh</a> development in Burleigh Heads.</p>

<p>The sale equates to around $37,500 per sqm.</p>

<p>The two-level, 800 sqm penthouse, featuring five bedrooms, five bathrooms, five car spaces, and a private infinity pool overlooking the Pacific Ocean, was acquired by a Gold Coast-based entrepreneur, highlighting continued demand for ultra-premium beachfront product.</p>

<p>Selling agent Freddie Tehle of PRD Burleigh Heads said the result reflects tightening supply of high-quality, large-format apartments in Burleigh.</p>

<p>“There’s very limited opportunity to secure this level of scale and absolute beachfront position in <a href="https://www.apartments.com.au/developments/burleigh-heads-qld-4220">Burleigh Heads</a>,” Tehle said.</p>

<p>“Buyers are increasingly seeking apartments that genuinely replace a standalone home, and this penthouse delivers that with its size, privacy, and direct ocean frontage.”</p>

<p>[smartcode_project:default project_id=146358 project_image_fid=323057]</p>

<p>The sale comes as construction progresses on ONE Burleigh, a boutique development of 17 full-floor residences at 88 The Esplanade, scheduled for completion in early 2027.</p>

<p>Developed by MAYD Group and designed by <a href="https://www.apartments.com.au/architects/mas-architecture-studio">MAS Architecture</a> with interiors by <a href="https://www.apartments.com.au/interior-designers/sici-design">Sici Design</a>, the project has been positioned as a collection of house-sized beachfront apartments, each occupying an entire floor with around 381 sqm of internal and external living space.</p>

<p>When construction commenced, MAYD director Todd Mould pointed to the long-term resilience of premium coastal real estate as a key driver behind the project.</p>

<p>“Real estate, particularly at the premium end, remains one of the most resilient and proven long-term investment avenues,” Mould said.</p>

<p>“Our ambition is that anyone who buys a MAYD-built product can genuinely feel the care, craftsmanship and commitment we bring to every detail.”</p>

<p>[smartcode_project:default project_id=146358 project_image_fid=323055]</p>

<p>Each residence has been configured with four bedrooms, multiple living zones, a private office, and expansive ocean-facing terraces. Interiors draw on a restrained material palette, including travertine stone, timber joinery, and integrated premium appliances.</p>

<p>Interior designer Sici Design said the approach was to reflect the project’s coastal setting through both materiality and spatial planning.</p>

<p>“ONE Burleigh is our vision of luxury living, designed to bring the essence of Burleigh Heads' vibrant coastal beauty into an unparalleled residential experience.”</p>

<p>Residents will have access to a suite of wellness-focused amenities, including pools, sauna facilities, and dedicated relaxation spaces, reflecting a broader shift toward lifestyle-driven apartment design on the Gold Coast.</p>

<p>[smartcode_project:default project_id=146358 project_image_fid=323052]</p>

<p>The project occupies a southern Esplanade site with uninterrupted beachfront frontage, an increasingly rare offering in Burleigh Heads, free from the Norfolk Pines that line much of the coastline and often limit direct ocean outlook.</p>

<p>Mould said the design intent was to balance that outlook with a sense of retreat.</p>

<p>“Living at ONE Burleigh is about how your day naturally unfolds, morning light across the ocean, coffee on the balcony, and being in Burleigh but elevated above the noise.”</p>

<p>The result further reinforces Burleigh Heads’ emergence as one of the Gold Coast’s most tightly held and supply-constrained beachfront markets, where boutique, owner-occupier-focused developments are increasingly setting new price benchmarks.</p>

<p>[smartcode_project_cta:default project_id=146358]</p>


Joel Robinson

MAYD Group sets Queensland record with $30 million penthouse sale at ONE Burleigh in Burleigh Heads

<p>Apartment developers in the Gold Coast are finding new, creative ways to differentiate themselves from competing projects, as new supply starts to flow through up and down the Coast.</p>

<p>Developer Big Projects brought in the renowned Sydney-based design studio YSG to craft the interiors for The Frederick, Big Projects' new Mermaid Beach project and YSG's first move into the multi-residential development space.</p>

<p>[smartcode_project:default project_id=110588 project_image_fid=5346]</p>

<p>It was a strategic move for Big Projects to bring in a Sydney eye to the development.</p>

<p>“Our role is to give our design partners the space and freedom to explore,” says Matt Barrett, Director of Big Projects.</p>

<p>“We wanted YSG Studio to capture the essence of Nobby’s, to design a building that embraces life, light and connection, while creating a genuine sense of place.”</p>

<p>There are only 39 apartments in The Frederick, including a striking beach house, just 100 metres from the booming Nobby Beach precinct.&nbsp;</p>

<p>[smartcode_project:default project_id=110588 project_image_fid=5347]</p>

<p>Yasmine Ghoniem, Director of YSG Studio, says their vision&nbsp;for The Frederick "reinvents coastal living."</p>

<p>“Nobby’s has such an iconic energy, it’s one of those rare pockets of the Gold Coast where the community, the beach, and the streets all feel connected,” Ghoniem says.</p>

<p>"Responding to the neighbouring coastline, soothing curves add a relaxing regional overlay, while unique detailing really sets it apart. It’s a place that feels lived in from the moment you step inside.”</p>

<p data-end="236" data-start="64">A standout feature of The Frederick is its rooftop terrace, an uncommon inclusion for a boutique, low-rise building, where amenity is typically concentrated at ground level.</p>

<p>[smartcode_project:default project_id=110588 project_image_fid=5360]</p>

<p data-end="523" data-start="308">Positioned to capture panoramic views from the hinterland to the ocean, the rooftop has been designed as a series of intimate zones. It includes a pool, sauna, sun decks, workspaces and dedicated entertaining areas.</p>

<p data-end="670" data-start="525">“The rooftop was conceived as a collection of spaces where residents can unwind and connect, an extension of the Nobby’s lifestyle,” Barrett says.</p>

<p data-end="760" data-start="672">Architecture for the project was led by Plus Architecture, with landscape design by LDG.</p>

<p data-end="951" data-start="762">SRQ Projects Director Nick Clydsdale, who is handling sales at The Frederick, says the majority of enquiry is coming from South East QLD and Victorian buyers who have been actively searching between Broadbeach and Mermaid Beach for some time.</p>

<p data-end="951" data-start="762">"They’ve reviewed a number of projects, however this one has stood out for its design flair/ appeal,"&nbsp;Clydsdale says.</p>

<p data-end="951" data-start="762">Site demolition is slated for this month, with construction commencing soon after. Big Projects is targeting a late 2027 completion.</p>

<p>[smartcode_project_cta:default project_id=110588]</p>


Big Projects taps Sydney’s YSG for first multi-residential project at The Frederick Mermaid Beach

<p>Melbourne-based property developer ALTA Property has this week achieved planning approval for the adaptive re-use of a former commercial tower into a $200 million, 169-apartment project at 10 Queens Road, one of the last developable sites along the Albert Park Lake-fronting boulevard.&nbsp;</p>

<p>Set within one of Melbourne’s most sought-after precincts and designed by <a href="https://www.apartments.com.au/architects/fraser-partners-0">Fraser and Partners</a>, the illustrious building will offer unparalleled views across Albert Park Lake, Port Phillip Bay and Melbourne CBD.&nbsp;</p>

<p>The mix of 1, 2 and 3-bedroom residences will be complemented by a ground-floor amenity featuring private dining, a lounge bar, gym and wellness spaces, co-working, outdoor communal gardens, and retail.&nbsp;</p>

<p>The 17-storey building is a masterclass in adaptive re-use, with the existing commercial building’s façade, shell and internal structure to be retained, before high-end residences are built from the ground up in a newly built Albert Park facing addition to the building.&nbsp;</p>

<p>Sitting atop the building will be two 320+sqm penthouses with private rooftop terraces, which are expected to be priced between $9 - $11 million.&nbsp;</p>

<p><img alt="ALTA Property achieves permit approval for $200 million Queens Road tower" data-entity-type="file" data-entity-uuid="aa11211b-5581-43f9-940c-fc84d30a0e61" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/C_04.png?VersionId=Yhf5p_1EgGDu_zOIMFgvA8Ug8j3sTFQs" /></p>

<p>Architecturally, the building will feature a curved, geometric façade that celebrates and elevates the existing structure, with warm, muted tones which were selected to extend the materiality of the existing building rather than contrast it.&nbsp;</p>

<p>Interiors will bring together three metre high ceilings with waffle concrete in some spaces, natural timber, granite and Australian materials, culminating in crafted, generous and considered spaces that are defined by authenticity.&nbsp;</p>

<p>The adaptive re-use means that the Queens Road project will be a sustainability led, high-quality finished product, with a 62% saving in carbon emissions by re-using the existing structure rather than knocking it down and rebuilding.&nbsp;</p>

<p>ALTA Property was launched by Nigel Givoni in 2023, bringing over 25 years of experience in multi level residential delivery.&nbsp;</p>

<p>Melbourne’s property market growth is currently led by apartments. According to RPM VIC Apartments &amp; Townhomes Market Report (April 2026), units are outpacing houses, especially in the middle ring suburbs where median prices hit $757,500 – a four-year high that represents 2.9 percent growth quarter-on-quarter.&nbsp;</p>

<p><img alt="ALTA Property achieves permit approval for $200 million Queens Road tower" data-entity-type="file" data-entity-uuid="647e13d7-b4bc-433a-9bc9-fe3c3dd4f2ec" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/V_06.png?VersionId=ou4NUCWUgA3NAy.6CQJlEdKX50j3dOk6" /></p>

<p>For ALTA Property Founder Nigel Givoni, this performance speaks to the confidence he has in the Melbourne market.&nbsp;</p>

<p>“Queens Road represents a rare opportunity to continue to shape our presence in the Melbourne market.,"&nbsp;Givoni says.</p>

<p>"With a considered project team and a premier site along one of the city’s most sought-after boulevards, we look forward to contributing to the fabric of this established address.</p>

<p>“Other Australian markets are getting a lot of attention, but I believe the depth of value in Melbourne is being overlooked. The fundamentals are strong, population growth is steady and, based on our preliminary conversations with a leading builder, construction costs are beginning to normalise, creating further opportunity."</p>

<p>Givoni says the project is a&nbsp;highly considered example of adaptive re-use, delivering quality, high-end residences, premium hotel-inspired amenities and an architecturally striking façade, all achieved without the need to remove the existing structure.</p>

<p>"We are really looking forward to the market’s response,” he said.&nbsp;</p>


ALTA Property to deliver $200 million Queens Road apartment tower

<p>Construction is set to begin at <a href="https://www.apartments.com.au/new-townhouses/orchard-mews-glen-iris-18-scott-grove-glen-iris-vic-3146">Orchard Mews</a> in Glen Iris, with&nbsp;PC Whitehall &amp; Sons&nbsp;now appointed as the townhome development moves into its next phase.</p>

<p>The development by&nbsp;<a href="https://www.apartments.com.au/developers/montcoeur">MontCoeur</a>,&nbsp;located at 18 Scott Grove, is now around 30 per cent sold, with completion targeted for late-2027.</p>

<p>Orchard Mews comprises a curated collection of three- and four-bedroom customisable townhomes, positioned within one of <a href="https://www.apartments.com.au/developments/glen-iris-vic-3146">Glen Iris</a>’ more tightly held residential streets. The low-density project has been designed by <a href="https://www.apartments.com.au/architects/cera-stribley-architects">Cera Stribley</a>, with landscape architecture by <a href="https://www.apartments.com.au/landscape-architect/jack-merlo">Jack Merlo</a>, bringing together a team known for high-end residential projects across Melbourne.</p>

<p>[smartcode_project:default project_id=150128 project_image_fid=366285]</p>

<p>The development is defined by its focus on flexible living and long-term usability. Each residence includes multiple living zones and a customisable multipurpose room, allowing buyers to tailor spaces to suit changing needs, whether as a home office, additional bedroom, wellness area or entertainment space.</p>

<p>Architecturally, the townhomes emphasise natural light and spatial volume, with dual-aspect layouts and double-height living areas incorporated into the design. Interiors feature natural stone benchtops, premium appliances, and a neutral material palette intended to support everyday functionality rather than statement-driven finishes.</p>

<p>All residences are all-electric and include private lifts and secure double garages, reflecting a broader shift toward sustainability and future-focused housing in Melbourne’s established suburbs.</p>

<p>[smartcode_project:default project_id=150128 project_image_fid=366277]</p>

<p>Outdoor connections are also central to the offering, with a mix of private courtyards and terraces extending internal living spaces and integrating with the landscaped surrounds.</p>

<p>The Scott Grove address places Orchard Mews within close proximity to some of Melbourne’s key lifestyle and education amenities, including Scotch College, Sacré Cœur, Cabrini Hospital and the retail hub of Chadstone. Public transport access is also nearby, with trams and Gardiner Station providing connectivity to the CBD and surrounding suburbs.</p>

<p>[smartcode_project_cta:default project_id=150128]</p>


Construction to commence at luxury Glen Iris townhome project, Orchard Mews

<p data-end="150" data-start="66">A rare new apartment development has been proposed on the fringe of St Ives Village.</p>

<p data-end="370" data-start="152">Developer Newquest Property has lodged plans for a low-rise apartment project designed by well-regarded architecture firm Warren &amp; Mahoney, which is best known for its work in the multi-residential sector in Melbourne.</p>

<p data-end="370" data-start="152">The building, proposed for a 1,916 sqm site on <a href="https://www.apartments.com.au/new-apartments/st-ives-residences-3-5-memorial-avenue-nsw-2075">Memorial Avenue</a> opposite St Ives Village Green, has been designed to blend into the surrounding natural environment.</p>

<p data-end="370" data-start="152"><img alt="St Ives" data-entity-type="file" data-entity-uuid="5c1c7437-2fba-4345-a6d7-05321714ad3e" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-04%20at%201.28.46%E2%80%AFPM.png?VersionId=KrYyMaJvNqR7vbx0xbB3Ef8sJ6FuHpmn" /></p>

<p data-end="745" data-start="537">“Drawing inspiration from the pale trunks and flowering canopies of the scribbly gums and blue gums prevalent in the area, a considered material palette was developed,” the architectural design report states.</p>

<p data-end="912" data-start="747">“This palette references the established materiality of the suburb while elevating it through refined finishes to achieve a more luxurious architectural expression.”</p>

<p data-end="1185" data-start="914">Of the 33 apartments proposed, 21 will be three-bedroom residences. The remaining mix includes nine two-bedroom apartments, one one-bedroom apartment and two four-bedroom residences. The development will be supported by 62 car parking spaces and 33 secure bicycle spaces.</p>

<p data-end="1270" data-start="1187">The proposal would replace two single-storey brick buildings currently on the site.</p>

<p data-end="1270" data-start="1187"><img alt="St Ives" data-entity-type="file" data-entity-uuid="21422eaf-09a9-4439-9278-b9bd9daf22a1" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-04%20at%201.38.10%E2%80%AFPM.png?VersionId=v.fXSgcUcEscvOZzqcjG5nk3gVqk_Amt" /></p>

<p data-end="1467" data-start="1272">St Ives remains a relatively untapped market for new apartment development. North Shore developer WINIM has a number of projects in the area, while INCA is nearing completion of Ellis Residences.</p>

<p data-end="1635" data-start="1469">More recently, Traders In Purple has lodged plans for one of the denser projects proposed in the suburb, a 75-apartment development on a 5,900 sqm site on Cowan Road.</p>

<p data-end="1635" data-start="1469">NewQuest, a construction, design and development firm, has delivered over 24 projects across commercial, residential, industrial, and lad markets.&nbsp;</p>

<p>&nbsp;</p>

<p>&nbsp;</p>


First look: NewQuest Property proposes new St Ives apartment development

<p>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.</p>

<p>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;</p>

<p>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.</p>

<p>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.</p>

<p>Even in the low seasons of May and June, occupancy levels reach around 40 per cent.</p>

<p><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" /></p>

<p>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</p>

<p>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.</p>

<p><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" /></p>

<p>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.<span><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span><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" /></span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></span><span><span><span><span><span><span>​</span></span></span></span></span></span></p>

<p>The apartments will feature modern amenities and contemporary designs with expansive windows capturing sweeping views of The Remarkables mountain range.&nbsp;</p>

<p>Interiors are equipped with modern finishes, premium appliances, and secure electronic key-locked doors, ensuring a comfortable living experience for residents and guests alike.</p>

<p>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;</p>

<p>Queenstown’s sustained demand for visitor accommodation and rental properties is underpinned by a shortage of housing options, attracting both local and international buyers.</p>


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

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<p><span style="line-height: 1.3em;">You know it wasn't that long ago that we lived in a totally different world. We had jobs for life. If you started work after leaving school in a bank, then you worked for a bank for the next thirty years or so. It was the same as buying a house and living in it for the same thirty years or so. That one house was deemed your 'investment for life' as superannuation was not yet invented.  </span></p>
<p>Also about 30 years ago, a little thing called the internet was introduced to us, we were told we could 'surf' the World Wide Web, little did we understand at the time the absolute massive impact this would have on the way we'd  live in the future.  </p>
<p> I have trouble explaining to my kids that there was no internet when we were kids! The internet has now become an historical era; we talk pre and post internet. The internet opened up everything and now anyone, no matter what age can start a new business or become an 'entrepreneur'. So the 30 year careers in one industry have become extinct. </p>
<p>A survey I read recently reported that 41% of all new business start ups in Australia are launched by people aged between 30 and 39, 21% aged 25 to 29 BUT 16% are aged between 40 and 44. I have a client starting her new business at the age of 58. Anything is possible. </p>
<p>Today I received a call from a fifty something man who had made his fortune in buying, building up and selling businesses and now he was ready to park his money in property using a Self Managed Super Fund. He said "Jo, I'm ready now to kick back a bit and let my investments do the work for me." He is looking at a Property Bloom development that he'll fund from his SMSF that will create a nice chunk of equity during the development process and then result in a strong  yielding investment for him. </p>
<p><span>The age for first time property investors is reducing. Whilst one in five Australians own an investment property, </span>the number of Generation Y’s, individuals born roughly between 1982 and 1994, who own multiple properties is now on par with the Baby Boomers (17% own 2 or more). My step daughter fits this description with three properties under her belt.  Our youngest client will have six investment properties once we complete the two developments we have underway for him. His strategy is to build his portfolio as quickly as possible then as he starts a family, pull back and let time and capital growth work for him. The Gen Ys I know are clever. They embraces the internet early and used it as a tool to research and educate themselves on property investing. </p>
<p>We live in a world overflowing with information and as older people realise that perhaps their 30 year career and original home is not going to deliver the retirement income they'll need over the next 30 years - because yes we are also living longer - then it's never too late to start investing and looking at entrepreneurial opportunities. Don't let physiological hang ups about 'comfort zones' set years ago hold you back. </p>
<p>It's exciting times and why not build your own dream now? </p>
<p><em>Jo Chivers is Chief Executive Officer of property development project managers <a href="https://www.propertybloom.com.au/about" target="_blank">Property Bloom</a>.</em></p>
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jochivers-wq5Bp59R5a

Never too old to own your future: Jo Chivers

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<p><span>As Sydney’s median house price appear headed for the $1,000,000 mark and as demand for inner-city apartments is at record levels, I would like to share some recent figures reflecting the state of the Manhattan Apartment market, where some of the prices are, according to the locals approaching ‘eye watering’ levels.</span></p>
<p><span>But first there’s a need to explain the differences between Co-ops and Condos, with a few key points.</span></p>
<p><span><strong>Co-ops</strong></span></p>
<p><span>Cooperatives or co-ops are common in New York City and they account for approximately 80% of apartment stock, these buildings are owned by an apartment corporation. Individuals do not actually “own” their apartments as they would in the case of “real” property, but own “shares” in the corporation, which entitles them to a long-term “proprietary lease.” The tenant-owner pays a portion of building expenses (which can include an underlying mortgage on the entire building) determined by the number of shares held in the corporation. Share amounts are dictated by apartment size and floor level. Co-ops are similar to our company title.</span></p>
<p><span><strong>Condos</strong></span></p>
<p><span>Condominiums – condos are common throughout the USA, but they are a rather new concept for New York City. A condominium apartment in Manhattan is real property and more or less directly like an apartment in Australia and they are usually easier to finance with lower deposit requirements.</span></p>
<p><span>With that brief summary in mind, the figures I refer to are for the second quarter 2015 and according to the Elliman Report [The Elliman Report, is private (non-official) research produced by Douglas Elliman in conjunction with Miller Samuel, a leading independent appraisal firm, and several other firms also produce these reports.] new price records were set for the average sale price, median co-op sale price, the average price per square foot for new developments, and the average price for luxury apartments, all jumped.</span></p>
<p><span>According to the report the average sale price for Manhattan is now a $1.87 million (AUD$2.487m*), and that’s 11.4% higher than a year ago. Of interest however is the fact that this growth is not being lead by luxury new developments, as was the case last year.</span></p>
<p><span>The record average and median price was set for the co-op market, and the established condo market average sale price also set a record, (with new development removed from the mix) the average, median, and price per square foot for resale condos, all set records making Manhattan apartments to quote ‘really expensive.’</span></p>
<p><span>Which might well be an understatement because the report puts the median sale price for all apartments at $980,000, (AUD $1.303m) which equals the second highest on record. While other published reports put the median slightly lower, at US$960,000 – $930,000, its worth keeping in mind that the current median record, US$1.025 million (AUD$1.363) was set in the pre-GFC market and peaked during the second quarter of 2008.</span></p>
<p><span>According to the Elliman Report the local co-op market, which is not swayed by new developments at all, saw some big price gains. The median price jumped nearly 10% from last year to US$795,000. The condo (apartment) market also set new records across the board, with the median price hitting US$1.39 million.</span></p>
<p><span>Compared to the first quarter, closings on new development condos sharply dropped, (keep in mind that in the USA sales including project sales are conducted very differently from our local market, auctions are rare and there is more negotiation involved with both sellers and buyers agents). Outside of the new project market, prices are transparent, when published prices are set, project prices are not published in the same way, with buyers being able to negotiate with the developer and then set a ‘closing’ price for the condo in a new project.</span></p>
<p><span>Currently Sydney has a lot of new apartment projects coming onto the market, while in these figures for Manhattan new projects accounted for just 8% of market transactions. Still new projects there stayed on trend and the average price per square foot set a new record, peaking at $2,011/sq. foot at approximately $22,300/sqm this is on a par with some new Sydney CBD projects and in some cases below our local price trends.</span></p>
<p><span><strong>Tight Supply</strong></span></p>
<p><span>Local commentators attribute these strong price gains to a lack of supply with new supply apparently ‘stalling’. Local market reports note that after bottoming out at the end of 2013, numbers expanded last year, but during the second quarter, supply only increased by a modest 1.3% over last year.</span></p>
<p><span>What’s also interesting is that apartments in the lower price range (below US$1 million) decreased, while those priced at $3 million or above saw steady gains. However the number of sales were down 20% compared to last year, and a lack of supply is seen as part of the reason volume dropped but the trend is still above average. According the Elliman report last year, the number of sales had spiked drastically thanks to pent-up demand that accumulated as the local economy improved after the financial collapse and things have now evened out.</span></p>
<p><span>Tight supply plus fewer ‘cheap apartments’ has been the perfect recipe for bidding wars, and that’s exactly what is happening. The report notes that more than half of all sales closed were at or above the asking price. The result was the highest such ratio since the financial crisis began. The Elliman report expects local price pressures will continue for the rest of the year and will eclipse 2014.</span></p>
<p><span><strong>Incomes Stall Impacting Affordability</strong></span></p>
<p><span>Like us there are concerns in this market over affordability and according to some comments in NYC this is crisis in the main caused by a lack of growth in incomes. The NYC Median Home Price Relative to Annual Income Ratio is now close to 7.0, whereas it used to be 5.0, the national ratio is now 3.7 years.</span></p>
<p><span>In Australia the figures look much worse, if you take (according to the ABS figures) average annual full-time income at $74,724 and assume, rather optimistically a house price of $650,000 then the ratio here is 8.6, well above the NYC ration. It’s no surprise then that according to figures from the International Monetary Fund (IMF) that Australia has the third highest house price-to-income ratio in the world, after Belgium, Canada comes Australia then followed by Norway and Sweden. But we are not alone and post the GFC the IMF found 14 out of 24 developed economies examined still have above-average house price-to-income ratios.</span></p>
<p><span>In the US, as a result stagnant wage growth, weak household formation and tight credit are the reason why according to some local commentators, like Australia the US is having a national discussion around affordable housing, with homeownership rates falling and where rental prices are rising. While low interest rates are helping to drive demand here, in the US credit terms are less favourable in part because low-doc loans have now all but gone from the market. Most lenders also require a 20% deposit and or some degree of mortgage insurance, but we need to keep in mind that while home loan interest is a tax deduction, insurance premiums are not.</span></p>
<p><span><strong>The NYC – Sydney Comparison</strong></span></p>
<p><span>While average and median prices might not reflect the full spectrum of any market it appears that NYC and Sydney are similar in one way. What the figures show is that the apartment market in NYC is operating at a level of intensity above the balance of the country, and that also applies to Sydney.</span></p>
<p><span>Sydney’s demand and prices are running ahead of most other Australian cities, and a so as a result we may be seeing a two-tire market emerging, that is with Sydney, in particular the inner-city areas very active and then other parts of Australia less so.</span></p>
<p><span>And it appears that our local Planning Minister Rob Stokes is fairly comfortable with this situation. Last week speaking at an industry event Minister Stokes suggested that Sydney forget comparisons with Melbourne or Brisbane, rather he expressed the view that Sydneysiders should compare their city with global leaders such as London, New York, Singapore and even Dubai and from some of the figures outlined we can see we already share some aspects between our apartment markets.</span></p>
<p><span>According to the minister “We have a generational opportunity to reshape Sydney and we should seize it with vigour,” adding that Sydney had to “confront the institutional and government challenges” that had crippled its progress for decades, starting with the “silo thinking of government departments and the 43 local governments” across the city.</span></p>
<p><span>It was very encouraging to hear Rob Stokes further encourage Sydney’s growth and international ambitions.</span></p>
<p><em>Peter Chittenden is managing director for residential of Colliers International. He can be contacted <a href="https://www.projectagenda.com.au/" target="_blank">here</a>.</em></p>
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Comparing New York property to the Sydney market: Peter Chittenden

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<p><span style="line-height: 1.3em;">Sydney’s three years of price growth has dragged the city up the capital city rankings for long-term capital growth, but only as high as fourth. </span></p>
<p>Six months ago, it ranked sixth among the eight capital cities and still lags behind Perth, Melbourne and Darwin. This is for average annual growth in house prices over the past 10 years, which we survey regularly for the Capital Growth Superstars report.</p>
<p>Fourteen of Sydney’s Top 20 suburbs have long-term growth rates below 8% per year - not nearly good enough to make the Top 20 lists for Melbourne, Perth or Darwin.</p>
<p>No suburb in the vast Sydney metropolitan area has a double-digit growth rate. The best is Pemulwuy (median price $720,000) in the city’s western suburbs, with a long-term growth rate of 9.5% per year. Most of the suburbs in the Top 20 have growth rates in the 7.0% to 8.0% range.</p>
<p>At first glance, it appears that the Top End suburbs dominate Sydney’s Top 20 list, as 19 of the Top 20 (all except Pemulwuy) have median prices above $1 million. But, in fact, these are mostly suburbs a tier below the top end. </p>
<p>In Sydney, the 15 most expensive suburbs all have median house prices above $2 million. None of the 20 most expensive suburbs (all with median prices above $1.9 million) make the Sydney’s Top 20 list for long-term capital growth. Most of them have growth rates below 5% per year.</p>
<p>Sydney’s Top 20 is dominated by 15 suburbs in the $1 million to $1.5 million range, which is Sydney’s second tier market.</p>
<p>This is a change from other surveys in the past three years, which have strongly featured the cheaper end of the Sydney metropolitan market. The growth of the past 2-3 years has elevated some of the more expensive areas.</p>
<p>The outstanding precinct is the Ryde LGA on the lower North Shore, which has four suburbs in the city Top 20. Ryde is the only municipality with more than two suburbs in the Top 20. Its four top suburbs are Eastwood, Ryde, Denistone East and West Ryde, all with median prices in the $1.1 million to $1.3 million range.</p>
<p>The prestige end of the market, suburbs with median house prices above $2 million, continues to deliver poor capital growth rates. Indeed, three of the most expensive suburbs of Sydney are included in the Bottom 20 list of suburbs with the worst growth rates in the city.</p>
<p>Vaucluse (median $3.4 million), Palm Beach (median $2.6 million) and Clontarf (median $2.5 million) all have growth rates of 2.1% per year or less. Clontarf’s 1.3% grow rate means it would take 55 years for property to double in value (compared to eight years for Pemulwuy, which has Sydney’s best growth rate).</p>
<p>There are four other million-dollar suburbs on the Bottom 20 list.</p>
<p>The worst precinct in Sydney for capital growth is the Sutherland LGA in the south of the metropolitan area – it has four suburbs (Burraneer, Bundeena, Lilli Pilli and Illawong) on the Bottom 20 list, all with growth rates below 2% per year.</p>
<p>Sydney’s Top 10 for long-term capital growth is:-</p>
<p>1 Pemulwuy 9.5%</p>
<p>2 Waitara 9.2%</p>
<p>3 Homebush 8.7%</p>
<p>4 Burwood 8.6%</p>
<p>5 Bondi 8.0%</p>
<p>6 Darlington 8.0%</p>
<p>7 Hurstville 7.8%</p>
<p>8 North Willoughby 7.8%</p>
<p>9 Haberfield 7.6%</p>
<p>10 Hurlstone Park 7.6%</p>
<p><em>TERRY RYDER is the founder of <a href="https://www.hotspotting.com.au/" target="_blank">hotspotting.com.au</a>. You can <a href="https://mailto:ryder@hotspotting.com.au" target="_blank">email him</a> or follow him on <a href="https://twitter.com/hotspotting" target="_blank">Twitter.</a> </em></p>
<p class="Normal"><span>Terry was recently joined by </span><em>Property Observer</em><span> editor at large Jonathan Chancellor for a webinar on why research is the key to successful property investing in 2015. You can download slides and audio from the webinar </span>here<span>.</span></p>
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Sydney's top 20 suburbs for growth rates: Terry Ryder

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<p><span style="line-height: 1.3em;">Someone with lots of time on their hands and not much to do has decided I’m a stressed person.</span></p>
<p><span style="line-height: 1.3em;">I should probably seek professional help because not only am I stressed but, alarmingly, I don’t know it. I’m never felt more relaxed in my life, but the aficionados has declared me stressed and these people are experts. Clearly I have a serious disorder.</span></p>
<p>But it gets worse. Apparently Australia is chock full of people just like me - stressed to the max, but don’t know it. We’re delusional apparently.</p>
<p>We’re all suffering from a new 21st Century disorder known as mortgage stress. The symptoms are a high standard of living, a quality home, an ability to pay all your bills, holidays overseas, happy kids and 30% of your income spent on your mortgage.</p>
<p>It’s a national issue because we don’t know it’s serious. We should all be in therapy but most of us aren’t. Someone should bring on a parliamentary inquiry. </p>
<p>Sorry, I forgot, they already have. We already have an politicians inquiry into affordability, following close on the heels of the previous 18-month investigation that found nothing of value.</p>
<p>Here’s how it works. One of those pointless businesses that compare home loans and interest rate deals has decided to drum up a bit of publicity in a competitive industry.</p>
<p>They know the key to success is to publish something sensationally negative and they know media is obsessive-compulsive over the whole issue of house prices and affordability.</p>
<p>So they’ve invented something called mortgage stress. They’ve arrogantly decided on a benchmark based on nothing other their desire for media profile. </p>
<p>So they’ve come up with garbage like this: “On average many owners in capital cities are on the tipping point of mortgage stress, committing 29% of their income to cover repayments. When owners use 30% of their income to repay their loans they are considered to be in mortgage stress.”</p>
<p>Really? According to which experts? Who has pronounced 30% to be the point at which we all fall into stress?</p>
<p><span style="line-height: 1.3em;">The answer is someone who writes press releases for a loan comparison outfit. It’s the quintessential case of lies, damned lies and statistics.</span></p>
<p>With the latest findings of this pointless exercise, you could actually come up with something spectacularly positive. Because the latest “research” indicates that Sydney residents with mortgages are NOT mortgage stressed. On average, Sydneysiders with mortgages spend only 26% of income on their mortgages payments. </p>
<p>After all the hysteria about Sydney prices and the so-called affordability crisis, Sydney households are actually very comfortable with their home loans. Isn’t that extraordinary?</p>
<p>Melbourne also is a city bereft of mortgage stress, with the typical household paying only 28% of income on the mortgage. Perth is very comfortable also. And across Australia, the average household is below the arbitrary red line of 30%.</p>
<p>That’s worth a headline, I would have thought, assuming you believe these figures have any relevance at all.</p>
<p>But the press release writer has buried this deep down the bottom of the media statement, because it’s a rather inconvenient fact. It doesn’t fit the objective of a sensationally negative finding.</p>
<p>The spokesperson for the pointless organisation (which will remain nameless because they don’t deserve the publicity) has declared the results “a bit worrying”.</p>
<p><span style="line-height: 1.3em;">“It’s alarming that so many Australians are over-stretching themselves and first home buyers and those buying with others are the worst off,’’ she said.</span></p>
<p>Actually, it’s not alarming at all. It’s quite the opposite. According to their figures, the residents of our largest and most expensive cities are not mortgage-stressed at all. And the average Australian is below the manufactured stress level.</p>
<p>So what did media do? Naturally they published the “findings” pretty much verbatim from the press release, breathlessly declaring a crisis.</p>
<p>Another addition to the great seething mass of misinformation about Australia real estate.</p>
<p>In my perfect world, publishing this kind of dishonest, fabricated-crisis nonsense would be a criminal offence. I see it as a form of fraud.</p>
<p><em> </em></p>
<p><em>TERRY RYDER is the founder of <a href="https://www.hotspotting.com.au/" target="_blank">hotspotting.com.au</a>. You can <a href="https://mailto:ryder@hotspotting.com.au" target="_blank">email him</a> or follow him on <a href="https://twitter.com/hotspotting" target="_blank">Twitter.</a> </em></p>
<p class="Normal"><span>Terry was recently joined by </span><em>Property Observer</em><span> editor at large Jonathan Chancellor for a webinar on why research is the key to successful property investing in 2015. You can download slides and audio from the webinar </span>here<span>.</span></p>
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Are you suffering from mortgage stress? Terry Ryder

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<div>Low interest rates have helped to spark one of the biggest housing booms Sydney has seen.<br><br>Sydney's median house price was up 22.9% or approximately $200,000 in the year to June 2015, following a massive 8.4% rise in the second quarter of the year.</div>
<div> </div>
<div>
<em>Domain Group</em>'s data:</div>
<div> </div>
<div><a href="/images/2015/07/23/Sydney.jpg" target="_blank">Click to enlarge</a></div>
<div> </div>
<div><img src="/images/2015/07/23/Sydney.jpg" alt=""></div>
<div> </div>
<div>
<div id="post-body-569318625860302453" class="post-body entry-content">Media reports a few viewpoints:<br><br>Dr Andrew Wilson:<br><br><div>"The double-whammy of the lowest interest rates since the 1960s and an investor frenzy has seen Sydney's median house price smash through the magic $1 million mark for the first time.</div>
<div> </div>
<div>Domain's senior economist, Dr Andrew Wilson, says house prices leapt an extraordinary 8.4% over the June quarter to $1,000,616.</div>
<div> </div>
<div>"It's the highest rate of growth since the late 1980s," Dr Wilson said.</div>
<div> </div>
<div><span style="line-height: 1.3em;">"And it's because of low interest rates and they're going lower, lower and lower."</span></div>
<div> </div>
<div>The median house price has increased by almost $200,000 in a year or 22.9%, which is one of the highest annual growth rates ever recorded by the city. <br><br>Dr Wilson said it exceeded the boom time results of 2001 and 2002.</div>
<div> </div>
<div>He attributed the huge growth to the high level of investor activity, with the $6.4 billion in loans approved over May – a record. <br><br>"Sixty-two per cent of the housing market loan share is now investors – another record – and an increase of 27 per cent over the first five months of this year compared with the first five months of last year."</div>
<div> </div>
<div>Will Hampson:</div>
<div> </div>
<div>"Auctioneer Will Hampson has presided at auctions going $200,000, $300,000 and even $500,000 over reserve this year with suburb records often being smashed."</div>
<div> </div>
<div>But even he described the $1 million median house price and the rate of growth as "incredible".</div>
<div> </div>
<div>"Each year for the past three years the auction market has been so strong," Mr Hampson said.</div>
<div> </div>
<div>He says auction listings are up 50 per cent up on last year for August and he's also tipping a strong spring.</div>
<div> </div>
<div>"Conditions are perfect because interest rates are at record lows and there's a shortage of supply in many pockets," Mr Hampson said.</div>
<div> </div>
<div>"A lot of buyers want to buy in a particular suburb – so perhaps Balmain, Mosman or Double Bay ... if they want to buy in those suburbs they are going to have to pay the price."</div>
<div> </div>
<div>The rate of growth is sure to spark fresh suggestions that the market is overheating but Mr Hampson hosed down such talk. "The market is not going to collapse ... even if it does adjust slightly, there's a massive amount of both local and foreign investment."</div>
<div> </div>
<div>...&amp; McGrath:</div>
<div> </div>
<div>"McGrath chief executive John McGrath said Sydney had proven itself to be one of the most resilient property markets in the world, with long-term fundamentals underpinning the market.</div>
<div> </div>
<div>"The boom will end at some point, but that doesn't mean price growth will end, but rather continue in a more moderate fashion," Mr McGrath said."</div>
<div> </div>
</div>
<div class="post-footer">
<p><span><em>PETE WARGENT is the co-founder of <a href="https://allenwargent.com/" target="_blank" rel="nofollow">AllenWargent</a> property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank" rel="nofollow">blogger</a>.</em><br></span></p>
<p><em>His latest book is <a href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx" target="_blank" rel="nofollow">Four Green Houses and a Red Hotel</a>.</em></p>
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Sydney boom accelerates: Pete Wargent

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<p><em>Hi <span id="0.4025715177413076" class="highlight">Margaret</span>,</em><br><br><em>My wife and I are in our late 20's and have a small mortgage and a lot of equity in our Sydney home.</em><br><br><em>We are keen to use the equity in our home to invest. A while ago I heard you talking with Steve Price on 2GB about investing around Logan or about 25km outside Brisbane. But we have had a few discussions with people and they have suggested to keep out of that area. Do you still think it is a good place to invest?</em><br><br><em>From memory you also mentioned to search for a place where population growth exceeds the national average, is this still the case?</em><br><br><em>Do you have a new list to keep and eye out to invest in and one to keep away from?</em><br><br><em>Thanks for your help.</em></p>
<p><em>Mike</em></p>
<p><span> </span></p>
<p><span>Hi Mike,</span></p>
<p><span><span>It's great news that you are ready to invest in property and I am really glad that you wrote to me before you took the plunge.  So many people leap right in without getting good, independent advice, and later suffer the consequences of having purchased a property from a spruiker who subsequently got a greater financial advantage  from the sale than the investor ever will! While that statement is likely to raise the hackles of the majority of self- styled property experts, that's ok - I'd rather have you forewarned than make friends!</span><br><br><span>So, having said that, now for a pep talk!  If you are serious about building a portfolio of sound, well performing properties, then you should not be deciding where to buy based on some expert's hotlist, and that includes my own!  If you are only going to be buying according to what any expert has to say about an area, then you are very likely far too late, as everyone else is also hearing that expert and buying there too.</span><br><br><span>You should also not be buying, or as is your case, NOT buying based on your discussions with 'people' who say not to buy in an area.  I'll hazard a guess that those people are well meaning friends, or perhaps locals who are providing suspect 'advice' based on their emotional feelings about an area.  Using Logan as an example, if you know what drives growth it's easy to see that Logan has growth drivers in spades, and these same drivers are likely to exert influence over the area for many years to come.  If you live in Brisbane, though, your view is likely tainted by the unpopularity of the area as a place to live in, and this view does not allow people to see past this inappropriate summary of an area's investing potential.  For my money, I'd prefer to buy in an area which can offer to me years of what I like to call 'generational' growth, than follow the sheep into the latest, upmarket area which may go great guns in the good times and plummet dismally the moment the economy turns in any way.</span><br><br><span>And so for you, your first port of call is education!  Learn how to become a successful property investor before you even start - all the ins and outs, what drives growth, how to negotiate, spot a bargain, and put in place the right structure - and this way, you won't need to ever take advice from anyone again.  You'll be less exposed to the danger presented by the spruikers, and more able to find, on your own, the next hotspot, buying there before the crowd descends and enjoying the very early growth that you get when you buy into a not-yet-known future hotspot. You'll also learn all of the factors which result in a great long -term investment, including how quickly the population grows, how the demographic mix affects property prices, how to identify meaningful infrastructure and much more.</span><br><br><span>But, be warned - spruikers are wolves in sheep's clothing.  They look just like the good guys and they certainly have an amazing gift which will seduce you and make you feel like your best interests are foremost in their minds. A good way to start in weeding out the opportunists is to ask a simple question - Does the advice being given also have a property sale attached to it?  It's simply not possble for any expert who ultimately sells a property to you, for which they gain a commission, to be providing independent advice which is also appropriate for your own personal circumstances!</span></span></p>
<p><span><em>Have a property question?      <a href="mailto:askmargaret@propertyobserver.com.au" target="_blank">Ask Margaret!</a></em></span></p>
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Ask Margaret: Where is a good place to invest with home equity?

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<div>The UK Land Registry released its latest House Price Index for the month of August 2015, which showed prices rising in the East (+8.4% year-on-year), South East (+7.6%), and yet again, in London (+6.6%).</div>
<div> </div>
<div>The largest gain for the month was seen in the capital city of London (+1.7%), while Cambridgeshire recorded yet another robust +7.8% year-on-year gain.</div>
<div> </div>
<div>On the other hand prices declined in the month in a number of the regions located away from The Smoke, including in t'North West, Yorkshire &amp; t'Humber, and in the East Midlands. </div>
<div>
<br>Prices have also remained relatively flat over the past year in Wales and the North East like.<br><br><strong><span style="text-decoration: underline;">Not shorting shortages</span></strong>
</div>
<div> </div>
<div>There have been some alarming statistics reported over recent years projecting dramatic housing shortages around London and the South East, and rarely is progess made on how the supply shortages will be tackled.</div>
<div>If there is one thing there <em>has</em> been a glut of over the past 20 years years it has been hapless experts trying in vain to pick turning points in the London housing market.</div>
<div> </div>
<div>Meanwhile average house London prices have increased from<span> <span>£</span>91,000 to nearly <span>£</span>500,000 (A$1,090,000), comfortably greater than a fivefold increase (today's average price is 5.4 times higher than in 1995, to be precise).</span>
</div>
<div><span> </span></div>
<div><a href="/images/2015/09/30/HPI.jpg" target="_blank"><span>Click to enlarge</span></a></div>
<div><span> </span></div>
<div><span><img src="/images/2015/09/30/HPI.jpg" alt=""></span></div>
<div> </div>
<div> </div>
<div>
<div>Different strokes for different folks, of course, but the single best investment decision I've made over the years has simply been to never sell a property, regardless of what the 'experts' in the media say.<br><br>Buy prime location capital city properties, never sell them. Sure you'll get cyclical downturns - see 2008, for example, which was quite a significant pull-back - but the long term trend is clear enough, provided you do buy in the right locations.<br><br>
</div>
<div><strong><span style="text-decoration: underline;">Down under</span></strong></div>
<div> </div>
<div>It is worth noting that cash rate futures markets in Australia are pricing in at least one more interest rate cut in this cycle, while implied yields already suggest that two further cuts by 2017 is a distinct possibility.</div>
<div> </div>
<div><a href="/images/2015/09/30/ASX.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2015/09/30/ASX.jpg" alt=""></div>
<div> </div>
<div>
<div>Even in the more bullish case scenarios, it appears likely that there are couple of years worth of slack in the labour market to be mopped up.<br><br>You can clearly see in the first chart of this blog post above the impact of the UK's macroprudential measures in 2014.<br><br>The City regulator the Financial Conduct Authority (FCA) "ran interference" with a series of measures known as the Mortgage Market Review last year, which temporarily disrupted growth in the London housing market.</div>
<div> </div>
<div>Macroprudential measures can undoubtedly slow the market for a while - HSBC will be the next bank to put the cold freeze on new investor loans in Australia - but ultimately nothing gets to work on cooling a housing market quite like higher interest rates.</div>
<div> </div>
<div>Unfortunately in Britain the emerging threat of an interest rate hike in 2016 (after a long hiatus since March 2009) now seems to be resulting in a surge of activity as buyers dive in before the Bank of England taps on the brakes.</div>
<div> </div>
<div>The Bank of England's mortgage approvals figures released this morning revealed the highest number of approvals in 19 months and the largest monthly jump in borrowing since 2008, with a net increase of <span>£</span>3.4 billion smashing analyst expectations - so the market appears set to accelerate once again, fuelled by record low mortgage rates.</div>
<div> </div>
<div>All of these are factors worth taking into account as the line of market observers trying to pick the next turning point in Sydney's housing market lengthens by the day. </div>
<div> </div>
<div>
<p><span><em>PETE WARGENT is the co-founder of <a href="https://allenwargent.com/" target="_blank" rel="nofollow">AllenWargent</a> property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank" rel="nofollow">blogger</a>.</em><br></span></p>
<p><em>His latest book is <a href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx" target="_blank" rel="nofollow">Four Green Houses and a Red Hotel</a>.</em></p>
</div>
</div>
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Macroprudential fail as London prices rise again: Pete Wargent

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<p>I have noticed that over the last few years there’s been a bit of trend towards marketing that I feel is starting to look somewhat predictable, even tired and humdrum, in both style and content.</p>
<p>This is not to suggest the content is wrong, but I wonder if the strength of the market has caused some marketing to be more template driven, with not enough effort focused on the core demographic in the various and I suggest very diverse markets. You see similar trends in other industries where for example both major supermarket brands tend to drive the same message across what must be very different markets. Then recently among the supermarkets we have seen one new player take a very different approach, and they are picking away at the market share of the two majors.</p>
<p>To help demonstrate my thinking I have had a look at some of the key demographics across the City of Sydney, the South-East and parts of the inner west, all very popular areas for medium and high-density living, but with some very individual demographics. Then when the differences are highlighted I think it’s good to ask if our marketing is on target, because there’s possibly more room to be particular.</p>
<p><strong>Some Key Differences</strong></p>
<p>One starting point, and one where there’s a very clear measure relates to income levels, and as might be expected in a market like the City of Sydney, there’s a big range of incomes. The areas of the city with the highest incomes are firstly centred on King Street where the median household income is around $106,000 followed by the core CBD with $102,000, and both these figures are well in excess of the metro median for Sydney.</p>
<p>While at the other end of the scale we have Chinatown and the CBD South at $61,500 and Redfern at $63,500, which are both well below the metro median, and I have to admit I was surprised by the figures for Chinatown. Then when looking more closely another fact in this area is the very big number of students, at almost double the average of other LGA areas. This has an impact on the buyer profile and would lead to a stronger investor market. This would normally be a key factor in marketing to this target.</p>
<p><strong>Growth Potential</strong></p>
<p>Incomes are a revealing pointer and another interesting measure is the potential for average population growth, because this would be a key factor in looking at values directly aligned to the potential for new supply. In this area we also find some contrasting results, this is a direct reflection of the maturity of particular sub-markets across the City.</p>
<p>The area with the lowest growth forecast at just 0.40% is the Macleay Street precinct and Woolloomooloo – this is not a surprise given how very limited sites are here and also how mature the market is with some pockets of high density living dating back to the 1930’s and so this is a very tightly held, high demand and low supply market.</p>
<p>Green Square and City South are by direct contrast areas expecting a lot of new supply and growth is forecast at 5.10%, which looks conservative, but that figure sets the tone of the area, and would influence all marketing and product development and would also impact price expectations and the potential for price growth.</p>
<p>Which brings me to one final area where it’s very useful to look at the population demographics and the big impact that has on how a project might be received, and I think it worth making the remark that markets are always evolving, but I’ll come back to this point.</p>
<p>Firstly I wanted to look at population density and what a leading indicator those figures are, in particular in areas where sites are being re-developed or in areas that were former industrial and manufacturing sites, like Sydney’s inner-east and south-east. Here we can see that there are groups of areas where density is high and well above 100 persons/hectare and this includes Elizabeth Bay, Rushcutters Bay, Redfern, Pyrmont, Haymarket, Darlinghurst and Newtown just sneaking in but set for more growth.</p>
<p>At the other end of the scale Alexandria and Rosebery sit well below the above figures at just 20.01 and 39.02 persons/hectare which aligns to the growth expected in both areas over the next few years, so lots of opportunity for new supply. There are a few other areas like The Rocks and Centennial Park with low figures, but these are not typical markets, while an area like Paddington is also low, but given it’s unique history and conservation needs future supply looks very limited.</p>
<p><strong>Diversity</strong></p>
<p>To help illustrate this topic I wanted to use a sample of demographics to help explore the diversity of our many markets and show how they signpost the evolving nature of each and very different targets. And while markets change we need to keep abreast of how we promote each area and now with the use of digital content this can be very uncomplicated and highly efficient. However the way figures always vary I think that making a big effort to engage our buyers is a first-rate idea.</p>
<p><em>Peter Chittenden is managing director for residential of Colliers International. He can be contacted <a href="https://www.projectagenda.com.au/" target="_blank">here</a>.</em></p>
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Understanding Sydney’s inner-city neighbourhoods: Peter Chittenden

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<p>There was a time when a big infrastructure project was an economic gold mine for the local community.</p>
<p>The proponents hired local people and bought services from local businesses. Expert personnel brought in from outside rented local houses.</p>
<p>How quaint were those days. How very last century. </p>
<p>Today you fly everyone in from a distance and build a temporary camp to accommodate them. A town can have a $2 billion project happening 5km down the road without any change in the local unemployment rate or the residential vacancy rate.<span style="line-height: 1.3em;"> </span></p>
<p>In fact, the vacancy rate may well rise if developers build new dwellings in anticipation of increased demand. Gladstone’s influx of tens of thousands of new jobs coincided with its vacancy rate rising from near zero to 10%. Most of the worker stayed in camps on an offshore island.</p>
<p>If you live locally and want a job on the big new project that comes to town, you may need to migrate interstate because big companies prefer to fly their workers in from outside.</p>
<p>Most companies planning big mining projects put out press releases promising to hire local workers and services, but in most cases they’re lying.</p>
<p>And it’s not just resources projects using the modern-day scourge of FIFO workforces and temporary accommodation camps. Now, everyone’s doing it.</p>
<p>In Bundaberg in Queensland, a business that grows strawberries has received council approval for a nine-stage short-term accommodation development to house seasonal workers. The losers will be local landlords and owners of backpackers accommodation.<span style="line-height: 1.3em;"> </span></p>
<p>In Toowoomba, a 500-room workers camp was proposed by one of the companies hoping to become the preferred tenderer for the $1.3 billion Toowoomba bypass, also known as the Toowoomba Second Range Crossing. </p>
<p>As it happens the Rangelink consortium didn’t win the tender. But it demonstrates how the concept of mobile workforces and temporary workers camps is taking hold.</p>
<p>The PR for projects like this always put the number of jobs created up in lights. That used to mean local jobs and politicians would gush about the local benefits. Today it’s likely very few of those jobs will be people living locally.<span style="line-height: 1.3em;"> </span></p>
<p>It’s changed the way property investors need to assess locations worthy of their attention. A big infrastructure development may create some economic ripples in the local community but these events no longer create the property booms of the past.</p>
<p>Today, the big infrastructure projects are more likely to create ghost towns than boom towns. Regional Australia is littered with towns that once thrived from the presence of big industrial developments or mining projects – places where investors enjoyed double-digit rental yields.</p>
<p>Now the vacancy rates read like this: Mackay 7%, Port Hedland 8%, Emerald 8%, Newman 9%, Chinchilla 17%, Miles 24%.</p>
<p>Many would speculate that this is evidence of the end of the resources boom. It’s not. In most cases, it’s evidence of the proponents of major mining or infrastructure projects bypassing the local town and putting up their workers in temporary camps. <span style="line-height: 1.3em;"> </span></p>
<p>The property market in the WA town of Newman has crashed during the construction phase of the $9 billion Roy Hill iron ore mine. Seven thousand people are working on this project but Newman’s median price has dropped 24% in the past year and rents are about a quarter of their peak levels.</p>
<p>And the core message is that  this phenomenon is no longer just a resources sector scenario. It’s spread to other enterprises.</p>
<p><em>Terry Ryder is the founder of <a href="https://www.hotspotting.com.au/" target="_blank">hotspotting.com.au</a>. You can <a href="https://mailto:ryder@hotspotting.com.au" target="_blank">email him</a> or follow him on <a href="https://twitter.com/hotspotting" target="_blank">Twitter.</a></em></p>
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FIFO accommodation and the rental debacle: Terry Ryder

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<p><span>The Australian Bureau of Statistics (ABS) published building approvals data for August 2015 earlier this week.  The data showed a month-on-month fall in approvals driven by a sharp drop in the number of unit approvals.  Keep in mind that unit approvals tend to be much more volatile than house approvals on a monthly basis.</span></p>
<p><a href="/images/2015/10/06/Chart-1.jpg" target="_blank"><span>Click to enlarge</span></a></p>
<p><span><img src="/images/2015/10/06/Chart-1.jpg" alt=""></span></p>
<p><span>Over the month there were 18,071 dwelling approvals which was a decline of -6.9% over the month.  Dwelling approvals hit a record high of 20,215 approvals in March 2015 and they are now -7.5% lower.  It does appear that approvals have peaked notwithstanding the fact that they remain at historically high levels.</span></p>
<p><a href="/images/2015/10/06/Chart-2.jpg" target="_blank"><span>Click to enlarge</span></a></p>
<p><span><img src="/images/2015/10/06/Chart-2.jpg" alt=""></span></p>
<p>There were 9,882 houses and 8,819 units approved for construction in August 2015.  House approvals actually increased by 4.4% over the month while unit approvals fell by -16.9%.  Year-on-year house approvals have increased by 2.2% compared to an 8.4% lift in unit approvals.  To further highlight the volatility of unit approvals the 8.4% year-on-year increase in August is well down on the 44.2% year-on-year rise in July.  Although it looks as if approvals have peaked it would not surprise to see a sharp rebound in unit approvals next month.</p>
<p>Across the country there was a record high 226,415 dwellings approved for construction over the 12 months to August 2015.  To put the magnitude of approvals in perspective, two years ago over the year to August 2013 there had been 166,658 dwelling approvals nationally.  There has also been a surge in unit approvals over recent years with a record high 48.8% of all dwelling approvals nationally being for units over the past year.  Again, 2 years ago units accounted for 42.5% of all approvals over the year.</p>
<p><a href="/images/2015/10/06/Chart-3.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2015/10/06/Chart-3.jpg" alt=""></p>
<p>It isn’t just the fact that more units are being built, the type of units being constructed is changing dramatically.  Over the 12 months to August 2015, 25.7% of all unit approvals were for townhouses, 10.1% were low rise (less than 4 storeys) and 64.3% were high-rise (4 storeys or more).  The above chart shows that historically townhouses have received the highest proportion of approvals.  Trends have changed quite swiftly, 2 years ago just 49.2% of all unit approvals were high-rise.  The rise in high-rise approvals is reflective of higher densities within our inner city markets.  High rise unit projects also take longer to build than a house or townhouse and as a result the economic benefit is stretched over a longer period.  Of course the fact that we are approving high-rise units at an unprecedented pace also creates some challenges.  Most notably who are buying these properties and over the longer term who is going to live in these units.</p>
<p>The data indicates that dwelling approvals have probably peaked for the current phase however, the number of approvals remains elevated.  This has created a significant pipeline of new construction much of which is high-rise and will take some time to complete.  Because unit development is so dependent upon presales it will be interesting to see just how many of these units are ultimately built.</p>
<p><em>Cameron Kusher is research analyst for CoreLogic RP Data. You can contact him <a href="https://blog.corelogic.com.au/author/cameron-kusher/" target="_blank">here</a>.</em></p>
<p><span> </span></p>
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