<p>Design-led developer-builder Lowe Living has unveiled its latest residential development, Jardin House, marking its first foray into Melbourne's blue-chip City of Boroondara.</p>

<p>Located a short walk from Camberwell Junction, <a href="https://www.apartments.com.au/new-apartments/jardin-house-by-lowe-living-camberwell-335-camberwell-road-camberwell-vic-3124">Jardin House</a> has been designed to appeal to affluent local downsizers and established families seeking a low-maintenance alternative to the large homes that have long defined Camberwell and surrounding suburbs.</p>

<p>The project will comprise a collection of two and three-bedroom apartments ranging from 92 sqm to 280 sqm, alongside a limited number of penthouse residences featuring rooftop terraces spanning more than 100 sqm, with optional private pools.</p>

<p>&nbsp;</p>

<p>[smartcode_project:default project_id=146717 project_image_fid=372212]</p>

<p>Lowe Living Co-Founder and Managing Director Tim Lowe said Camberwell represented a natural next step for the developer as it expands into some of Melbourne's most tightly held residential markets.</p>

<p>"Jardin House is an important project for our team as it marks the next evolution of our portfolio into different well-established blue-chip pockets of Melbourne," Lowe said.</p>

<p>"Camberwell, with its incredible walkability, family-led neighbourhood feel and superb access to education and transport, makes it a natural choice for us."</p>

<p>[smartcode_project:default project_id=146717 project_image_fid=372227]</p>

<p>Designed by Tristan Wong Architects, with interiors by Hecker Guthrie and landscaping by Acre, the development takes inspiration from the Art Deco architecture that remains a defining feature of many of Camberwell's established streets.</p>

<p>A curved facade, arched openings, textured brickwork and sculpted forms reference the suburb's architectural heritage, while extensive landscaping softens the building's presence and creates a strong connection to the surrounding tree-lined streetscape.</p>

<p>The project will be set behind a secure gated entrance, with residents arriving through landscaped gardens designed to create a transition between the public realm and private residences.</p>

<p>Inside, the residences feature natural stone and timber finishes, full-height glazing, Miele appliances and generous open-plan living areas designed for long-term owner occupation.</p>

<p>[smartcode_project:default project_id=146717 project_image_fid=372225]</p>

<p>While the apartments themselves have been designed to attract discerning owner-occupiers, it is the amenity offering that sets Jardin House apart from many other boutique projects currently launching across Melbourne.</p>

<p>The centrepiece is a 350 sqm private bathhouse curated in partnership with Aurora Spa &amp; Bathhouse founder Lyndall Mitchell.</p>

<p>The wellness precinct includes mineral pools, hydrotherapy experiences, a Himalayan salt room, sauna, steam room, cold plunge pools and dedicated relaxation spaces, creating what Lowe Living describes as a private wellness retreat exclusively for residents.</p>

<p>[smartcode_project:default project_id=146717 project_image_fid=372222]</p>

<p>The collaboration follows Lowe Living's recent partnership with Aurora at Maison Savoy in Brighton, although Jardin House is the first project to incorporate both indoor and outdoor wellness experiences.</p>

<p>Emma Lowe, Co-Founder and Managing Director of Lowe Living, said wellness was becoming an increasingly important consideration for apartment buyers.</p>

<p>"Collaborating with Lyndall Mitchell from Aurora Spa &amp; Bathhouse for a second time is an intentional nod to creating residences that are more than just homes, but a way to enrich the lives of our residents through wellness and longevity," Lowe said.</p>

<p>The amenity offering is complemented by a Technogym fitness studio, residents' lounge, private dining spaces and concierge services.</p>

<p>The launch comes as developers increasingly target Melbourne's established eastern suburbs, where rising land values, ageing housing stock and growing downsizer demand are creating opportunities for boutique apartment projects.</p>

<p>Lowe said the company expects significant generational wealth transfer across suburbs such as Camberwell in coming years, creating further demand for luxury apartment living.</p>

<p>"Camberwell is a blue-chip suburb where homes regularly transact for multiple millions of dollars," he said.</p>

<p>"The generational change of wealth in these locations expected in the coming years is significant, so we see an opportunity to create exclusive residences that appeal to older families and downsizers in order to meet this demand."</p>

<p>Apartments at Jardin house start from $1,195,000. The project forms part of Lowe Living's near-$1 billion portfolio of new developments across Melbourne.</p>

<p>[smartcode_project_cta:default project_id=146717]</p>


Joel Robinson

Lowe Living launches Jardin House in Camberwell

<p>As <a href="https://www.apartments.com.au/developments/north-sydney-nsw-2060">North Sydney</a> continues its transition from a commercial centre into a more layered residential and lifestyle precinct, a new generation of apartment developments is reshaping expectations around scale, amenity, and long-term liveability.</p>

<p>Improved transport connections through the Victoria Cross Metro, continued investment in dining and public spaces, and a constrained supply of new luxury apartments have sharpened demand for homes that combine proximity to the CBD with the privacy and outlook traditionally associated with harbourside houses.</p>

<p>At 177 Walker Street, <a href="https://www.apartments.com.au/developers/aland">ALAND</a>’s new apartment development <a href="https://www.apartments.com.au/new-apartments/the-walden-north-sydney-177-walker-street-north-sydney-nsw-2060">The Walden</a> enters the market with a distinctly residential approach to high-rise living. The 30-level tower will deliver 161 residences, ranging from one-bedroom apartments through to sub-penthouses and a full-floor penthouse, all oriented to capture uninterrupted views across Sydney Harbour, the Opera House, and out toward the Pacific Ocean.</p>

<p>[smartcode_project:default project_id=134323 project_image_fid=6395]</p>

<p>Designed by <a href="https://www.apartments.com.au/architects/rothelowman">Rothelowman</a>, the project takes advantage of the site’s natural topography and elevated position above the harbour. Rather than relying on density alone, the architecture focuses on outlook, orientation, and spatial flow, with every apartment occupying a corner position to maximise natural light and cross ventilation.</p>

<p>Rothelowman says the site itself shaped much of the architectural response.</p>

<p>“The site has a long history in terms of its inevitable transformation and when we came in, we took inspiration from the idea of reestablishing a sense of the site’s natural terrain and fall. Our scheme aims to integrate with the terrain and the landscape, using the undulating site to slowly reveal glimpses and views of the harbour. The rotation of the tower off grid means every apartment has a view and is naturally cross ventilated. The building's colour palette is quintessentially Sydney, with bronze and sandstone and a luminescent green colour in the glass, making it very earthy and grounded in its location.”</p>

<p>[smartcode_project:default project_id=134323 project_image_fid=6399]</p>

<p>Inside the residences, the emphasis moves toward larger-format living typically associated with standalone homes. Kitchens sit at the centre of the apartments, connecting directly to open-plan dining and living areas before extending outward into expansive winter gardens and balconies. Calacatta marble, bespoke joinery, integrated appliances, and custom metal detailing are used throughout, while three distinct interior palettes, Terrace, Opera, and Harbour, allow buyers to personalise the spaces without compromising the architectural consistency of the project.</p>

<p>The larger residences place particular attention on separation between entertaining and private zones. In many apartments, master suites occupy the outer corners of the floorplates, allowing bedrooms to benefit from floor-to-ceiling glazing and harbour outlooks independent of the living spaces. Dressing rooms and ensuites continue the material palette through fluted detailing, freestanding baths, and layered stone finishes.</p>

<p>Rothelowman says the design intent centred on creating homes that feel enduring rather than transient.</p>

<p>“Our philosophy is all about the way people live in these spaces, and we wanted to create homes that reflect the quality of life in this unique Sydney location. The apartments showcase expansive living spaces that are generous, sophisticated, and bold, with the ability to connect with views throughout each apartment.”</p>

<p>[smartcode_project:default project_id=134323 project_image_fid=353235]</p>

<p>A separate four-storey amenity building known as The Pavilion expands the residential offering beyond the apartments themselves. Positioned alongside the tower, the building consolidates wellness, recreation, and social spaces into a dedicated resident retreat. Facilities include a 20-metre rooftop pool and sundeck, sauna, spa, ice bath, wellness studio, gymnasium, concierge service, wine cellar, residents’ lounge, private dining spaces, and dedicated co-working areas with meeting rooms and boardroom facilities.</p>

<p>The amenity mix reflects the buyer profile emerging in North Sydney, where owner-occupiers and downsizers are increasingly prioritising convenience, apartment scale, and long-term usability over purely investment-driven decisions.</p>

<p>The Walden also represents a significant milestone for ALAND, marking the company’s first major move into Sydney’s inner-city luxury apartment market after more than two decades delivering large-scale residential communities across Greater Sydney. Founder Andrew Hrsto says the Walker Street site stood apart because of both its positioning and its rarity.</p>

<p>[smartcode_project:default project_id=134323 project_image_fid=6390]</p>

<p>“As a company, we had been searching for a site in one of Sydney’s blue-chip locations, spanning the Eastern Suburbs, the Sydney CBD and the North Shore, and when we had the opportunity to purchase this site, we immediately recognised that it could be something iconic.”</p>

<p>At launch, The Walden recorded more than $103 million in sales, with buyers drawn to the project’s harbour positioning, apartment scale, and proximity to the Metro, which now connects North Sydney to Barangaroo in three minutes and Martin Place in five.</p>

<p>ALAND has commenced construction, and is expecting a completion date in 2028.</p>

<p>[smartcode_project_cta:default project_id=134323]</p>


The Walden pairs house-scale living with North Sydney connectivity

<p>The ACT will become the first jurisdiction in Australia to abolish stamp duty for all first home buyers, with no income caps and no property price thresholds from 1 July.</p>

<p>The move, announced as part of the ACT Budget, completes a key election commitment from the Barr Government and removes what Chief Minister Andrew Barr described as one of the biggest barriers to entering the housing market. The reform forms part of the ACT's long-running transition away from transaction taxes and towards a broader-based property tax system.</p>

<p>"This budget marks a major milestone in our long-term tax reform program," Barr said, adding that the government had maintained a sustained focus on removing barriers to home ownership. He said stamp duty had long been one of the largest upfront hurdles facing buyers and that from July, "that barrier is gone" for first home buyers in the Territory.</p>

<p>[smartcode_project:default project_id=139989 project_image_fid=350986]</p>

<p>The changes come alongside a range of measures designed to encourage new housing supply, including support for the delivery of so-called "missing middle" housing such as terraces, townhouses and low-rise multi-unit developments.</p>

<p>The announcement has renewed debate around whether the ACT's approach could provide a blueprint for improving housing affordability nationally.</p>

<p>New research from OurTop10.com.au, conducted by Primara Research, suggests the Territory's decade-long reform agenda has produced outcomes unmatched elsewhere in Australia.</p>

<p>While stamp duty costs have increased by an average 67 per cent nationally over the past decade, the ACT has recorded growth of just 15 per cent, the lowest increase of any jurisdiction.</p>

<p>The Territory has also emerged as one of the strongest performers on housing delivery. Based on population-weighted housing targets, the ACT is sitting less than one per cent behind its target. Victoria is the next closest at seven per cent behind, while the national average sits 25 per cent below target. New South Wales is tracking 39 per cent behind.</p>

<p>The latest reform removes one of the final barriers facing first home buyers in Canberra.</p>

<p>[smartcode_project:default project_id=139989 project_image_fid=359152]</p>

<p>The average Australian home buyer currently pays $61,714 in stamp duty. In the ACT, that figure is $38,399 despite the Territory having the third-highest median house price in the country.</p>

<p>Until now, the ACT's first home buyer concession scheme only applied to purchases up to $1.02 million, around $51,000 below Canberra's median house price of $1.071 million. In practical terms, many first home buyers were unable to access the median-priced home without losing the concession.</p>

<p>From July, those restrictions disappear.</p>

<p>Every first home buyer in the ACT will pay no stamp duty, regardless of income or purchase price.</p>

<p>Canberra remains one of Australia's most expensive housing markets, with dwelling values increasing 82 per cent over the past decade. However, that growth ranks only 11th among Australia's 15 major housing markets, suggesting affordability pressures have been less severe than in many other parts of the country.</p>

<p>Simon Ma, CEO of OurTop10.com.au, said the latest reforms recognise that many first home buyers have simply outgrown thresholds set years ago.</p>

<p>"Many first home buyers aren't just looking for a way onto the ladder, they want a home their family can actually live in," Ma said.</p>

<p>"In a market where the median house price is over a million dollars, a concession scheme that cuts out at $1.02 million was never going to get them there.</p>

<p>"Removing the ceiling entirely means ACT first home buyers can now pursue the home they actually want, rather than limiting themselves to a price point designed for a very different market."</p>

<p>Whether other states follow remains to be seen. But at a time when most jurisdictions are struggling to improve affordability while also increasing housing supply, the ACT has quietly become the national test case for both.</p>


15% stamp duty growth. Just 1% off the national housing target. Zero stamp duty for FHBs. Is the ACT the blueprint for the great Australian dream?

ACT abolishes stamp duty for first home buyers

<p>A rooftop pool and spa overlooking the Brisbane CBD, private dining spaces, expansive landscaped gardens and a residents' lounge are set to crown <a href="https://www.apartments.com.au/new-apartments/callista-on-park-west-end-49-mollison-street-west-end-qld-4101">Callista on Park</a>, the final residential building within Brisbane's West Village precinct.</p>

<p>The rooftop amenity collection has been designed as an extension of the lifestyle already established throughout West Village, providing residents with a series of indoor and outdoor spaces that capitalise on the building's elevated position above West End.</p>

<p>A swimming pool and heated spa form the centrepiece of the rooftop offering, surrounded by landscaped gardens developed through a collaboration between developer Sekisui House and ASPECT Studios. The design incorporates expansive lawn areas surrounded by English garden-inspired planting.</p>

<p>[smartcode_project:default project_id=134800 project_image_fid=370648]</p>

<p>Residents will also have access to two barbecue and outdoor dining areas positioned to take advantage of views across Brisbane's skyline, neighbouring Mollison Park, and the surrounding inner-city landscape.</p>

<p>For larger gatherings, the rooftop includes a private dining room centred around a substantial stone island bench, complete with a full kitchen and a 10-seat dining table set beneath four-metre-high ceilings. The space has been designed to overlook both the rooftop gardens and the Brisbane CBD skyline.</p>

<p>A separate residents' lounge provides an additional indoor retreat connected to the broader rooftop amenity offering, creating another space for residents to work, relax or entertain guests.</p>

<p>[smartcode_project:default project_id=134800 project_image_fid=370647]</p>

<p>The attention to detail extends beyond the rooftop.</p>

<p>Upon arrival, residents will enter through a lobby featuring a bespoke ceiling light installation developed in collaboration between Sekisui House and Alcorn Middleton Architecture. The arrival experience is complemented by private resident mailboxes and carefully considered interior finishes designed to reflect the premium positioning of the building.</p>

<p>[smartcode_project:default project_id=134800 project_image_fid=372541]</p>

<p>The amenity offering forms part of Callista on Park, the final residential release within the decade-long transformation of the former Peters Ice Cream Factory site into West Village, one of Brisbane's most established mixed-use communities.</p>

<p>Designed by <a href="https://www.apartments.com.au/architects/rothelowman">Rothelowman</a> and being delivered by <a href="https://www.apartments.com.au/builders/hutchinson-builders">Hutchinson Builders</a>, Callista represents the most premium residential offering within the masterplanned precinct.</p>

<p>Construction is now entering its final stages, with scaffolding beginning to come down and completion expected in the first quarter of 2027.</p>

<p>Prices for the three-bedroom plus MPR apartments start from just over $2.6 million.</p>

<p>[smartcode_project:default project_id=134800 project_image_fid=351535]</p>

<p>Callista will mark the final opportunity to purchase within West Village, where residents have direct access to more than 35 retail, dining, wellness and medical operators including Harris Farm Markets, Woolworths, Function Well and Goodlife Health Clubs, Metro Arts, and a growing collection of restaurants and cafés.</p>

<p>Located just 800 metres from the Brisbane CBD, the precinct also places residents within walking distance of South Bank, West End's dining scene, riverfront parklands and major public transport connections.</p>

<p>For Sekisui House, which has delivered more than two million homes globally, Callista serves as the concluding piece of the West Village masterplan, bringing together the precinct's heritage character, parkland setting and emphasis on walkability in a final collection of larger-format residences.</p>

<p>[smartcode_project_cta:default project_id=134800]</p>


Rooftop pool, private dining and skyline gardens to crown West Village's final apartment release, Callista on Park

<p><a href="https://www.apartments.com.au/developments/wahroonga-nsw-2076">Wahroonga</a>’s enduring appeal has long been tied to its balance of bushland, established amenity, and access to some of Sydney’s most respected education and healthcare institutions.</p>

<p>Along Fox Valley Road, that combination is becoming increasingly sought after by buyers looking to remain connected to the Upper North Shore lifestyle while prioritising walkability, wellbeing, and convenience.</p>

<p>Developer Capital Corporation's initial vision of a 62-hectare site on Fox Valley Road was that they could create their own walkable community, bordered by&nbsp;more than 25 hectares of bushland and adjoining Coups Creek.</p>

<p><img alt="Wahroonga" data-entity-type="file" data-entity-uuid="b84917a1-0d75-49b9-888c-ddf7ebfd6692" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/NEW2026_Wahroonga_Walkway.gif?VersionId=Gk3_xi5ssYfalmwuQQ5umQakddceC31j" /></p>

<p><a href="https://www.apartments.com.au/new-apartments/the-residences-at-wahroonga-estate-169-fox-valley-road-wahroonga-nsw-2076">The Residences at Wahroonga Estate</a> draws directly on the area’s natural landscape, with walking trails and green corridors linking into sections of Lane Cove National Park. The surrounding network of bushwalks, cycling tracks, and reserves reinforces the suburb’s long-standing reputation as one of Sydney’s most nature-oriented residential pockets, while still maintaining close ties to village retail and transport infrastructure.</p>

<p>The address places residents within minutes of Wahroonga and Turramurra villages, where cafés, local grocers, boutiques, and everyday services support a highly localised lifestyle. Popular nearby venues including The Fox Café and Breeze Valley Café provide easy options for morning coffee or casual dining, while longstanding retailers such as IGA Wahroonga Fresh and Novella Fine Books continue to anchor the area’s village character.</p>

<p>&nbsp;</p>

<p><img alt="Wahroonga" data-entity-type="file" data-entity-uuid="c4a950f7-4f05-4370-b360-b106359788e5" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/2026_Wahroonga_Entry_Gates.gif?VersionId=7n5kh9ymu.azYEYDemJkPgiIAfSw44oj" /></p>

<p>Healthcare access remains one of the defining locational advantages of the estate. Sydney Adventist Hospital, known locally as The San, sits directly adjacent and is one of the largest and most respected private hospitals in New South Wales. The hospital precinct incorporates specialist medical services, radiology, physiotherapy, and outpatient care, contributing to growing buyer demand from downsizers and owner-occupiers seeking long-term convenience and peace of mind.</p>

<p>Research commissioned by Capital Corporation found that health and wellbeing considerations are increasingly influencing downsizing decisions, particularly among buyers wanting to remain within familiar neighbourhoods while accessing medical infrastructure more easily.</p>

<p>Education has also historically underpinned demand across Wahroonga and the broader Upper North Shore. The estate sits close to several of Sydney’s leading private and independent schools, including Knox Grammar, Abbotsleigh, Barker College, Pymble Ladies’ College, Ravenswood School for Girls, and Loreto Normanhurst. Co-educational options including Wahroonga Adventist School and Sydney Adventist School further strengthen the area’s appeal to established families looking for long-term schooling pathways within a tightly held catchment.</p>

<p>[smartcode_project:default project_id=135247 project_image_fid=262183]</p>

<p>Transport connectivity supports the suburb’s liveability without compromising its quieter residential character. Wahroonga and Turramurra train stations provide direct rail access into the Sydney CBD, while the nearby Pacific Highway and M1 motorway strengthen links across the North Shore and broader metropolitan area. At the same time, the heavily treed streetscape and low-density character continue to distinguish the precinct from more urbanised parts of Sydney.</p>

<p>The Residences at Wahroonga Estate forms the first stage of <a href="https://www.apartments.com.au/developers/capital-corporation">Capital Corporation</a>’s broader masterplanned vision for the precinct, delivered alongside the Seventh-day Adventist Church.</p>

<p>[smartcode_project:default project_id=135247 project_image_fid=364995]</p>

<p>Designed by <a href="https://www.apartments.com.au/architects/group-gsa">GroupGSA</a> with interiors by <a href="https://www.apartments.com.au/interior-designers/coco-republic-interior-design">Coco Republic</a>, the development integrates landscaped communal spaces including a pet-friendly Green Spine, resident lounge, BBQ pavilion, and direct bushland access, reinforcing the project’s focus on outdoor connection and community-based living.</p>

<p>Now under construction by Gold Star iCIRT-rated builder <a href="https://www.apartments.com.au/builders/dasco-australia">DASCO</a>, The Residences at Wahroonga Estate will deliver a collection of one, two, and three-bedroom apartments priced from $990,000, with completion anticipated in 2027.</p>

<p>[smartcode_project_cta:default project_id=135247]</p>


Capital Corporation to cater to Upper North Shore downsizers by creating walkable community at The Residences at Wahroonga Estate

<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

<html><body>
<p>Auction activity has eased slightly this week, with 1,824 capital city auctions held, down from 2,230 last week and also lower relative to the same week last year when 2,232 residential homes were taken to auction.</p>
<p>The preliminary clearance rate across the combined capital cities strengthened slightly this week, from 67.7 percent the previous week to 68.9 percent. One year ago, along with the higher volume of auctions, the clearance rate was also stronger at 77.5 percent.</p>
<p><a href="/images/2016/05/16/20160516-Capital-city-1.png" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/05/16/20160516-Capital-city-1.png" alt=""></p>
<p>After <strong>Melbourne</strong> was host to 1,404 auctions over the final week in April, and 1,150 last week, the number of Melbourne auctions this week has fallen to 859. The clearance rate, on the other hand, has remained relatively steady, with preliminary results showing 70.6 per cent of Melbourne auctions clearing this week, compared to 73.2 per cent last week. At the same time last year, 78.3 per cent of Melbourne auctions were successful. The busiest Melbourne sub-region this week was the Inner region, with 160 auctions and a preliminary clearance rate of 76.3 per cent. In terms of clearance rates, the most successful sub-region this week was the West region (80.3 per cent).</p>
<p><a href="/images/2016/05/16/Screen%20Shot%202016-05-16%20at%2011.38.34%20AM.png" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/05/16/Screen%20Shot%202016-05-16%20at%2011.38.34%20AM.png" alt=""></p>
<p>Preliminary results for <strong>Sydney</strong> show a 75.6 percent clearance rate across 517 results this week. Over the week there were 614 Sydney homes taken to auction, down from 676 last week and significantly lower relative to last year (885). Sydney’s clearance rate last week was lower in comparison, at 71.8 per cent, while one year ago it was 85.0 percent. Across the individual regions of Sydney there was some varied performance this week with clearance rates ranging from as high as 93.1 percent in Ryde and as low as 26.3 percent in the Outer South West region where just 22 auctions were held.</p>
<p><a href="/images/2016/05/16/Screen%20Shot%202016-05-16%20at%2011.34.02%20AM.png" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/05/16/Screen%20Shot%202016-05-16%20at%2011.34.02%20AM.png" alt=""></p>
<p><strong>Brisbane</strong> had 153 auctions last week, down from 195 the previous week, which was the busiest for the city in seven weeks. The preliminary clearance rate rose to 51.2 per cent from 41.2 percent the previous week, while last year half of the 136 homes taken to auction were sold. Across the <strong>Gold Coast</strong>, 34 results have been reported so far with a preliminary clearance of 41.2 per cent.</p>
<p><a href="/images/2016/05/16/20160516-Brisbane.png" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/05/16/20160516-Brisbane.png" alt=""></p>
<p>The preliminary clearance rate for <strong>Adelaide</strong> this week is 67.9 per cent, up from 59.8 per cent last week and also higher than one year ago (63.8 per cent). Despite the fall in auction activity on an aggregate level, there were more auctions in Adelaide this week (100) compared with last week (94). One year ago, 106 Adelaide auctions were held.</p>
<p><a href="/images/2016/05/16/20160516-Adelaide.png" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/05/16/20160516-Adelaide.png" alt=""></p>
<p>Across <strong>Perth</strong>, 41 auctions were held this week with 20.0 per cent selling, based on the 15 reported results. Last week showed 23.5 per cent of auctions were sold and 41.9 per cent last year, noting that the cities clearance rate tends to move around a fair bit on a week-on-week basis.</p>
<p><strong>Canberra’s</strong> preliminary clearance rate was 58.6 this week, compared to 54.3 per cent last week and 70.3 per cent at the same time last year.  Auction volumes were relatively steady over the week, at 49 compared to 50 over the previous week.</p>
<p>In <strong>Tasmania</strong> 8 auctions were held over the week and of the 7 reported results, 2 sales have been recorded.<br><br></p>
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Preliminary clearance rate edges higher, to 68.9 percent from 67.7 percent last week: CoreLogic RP Data's Shana Miller

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<p>Entering the property market is a tough gig for first home buyers, especially when faced with competition from buyers who hold larger buying budgets, some of which has been accrued from property equity earned as a result of recent strong capital gains.  </p>
<p>While home value rises have been moderate over recent years outside of Sydney and Melbourne, it provides little comfort for first home buyers in the two largest cities who struggle to compete with those that already own homes.</p>
<p>In 2008, combined capital city home values fell by -6.1 percent in the space of 9 months. By the end of the year, home values had reached and began to climb further thereafter. </p>
<p><a href="/images/2016/05/25/Screen%20Shot%202016-05-26%20at%203.35.10%20PM.png" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/05/25/Screen%20Shot%202016-05-26%20at%203.35.10%20PM.png" alt=""></p>
<p>The growth drivers largely came from two forms of stimulus: aggressive interest rate cuts and a boost to the First Home Owners Grant (FHOG). Since the removal of the FHOG boost and scaling back and complete removal of others, first home buyers have continued to languish at near record-low levels.</p>
<p>The increase in home values across each capital city from December 2008 to April 2016 can be seen in the first of the adjacent charts. Another way to think about this is that if in December 2008 you owned a home worth $500,000 it is now worth $758,418 which is $258,418 more than in December 2008. Looking at this same calculation across each capital city, the increases in value over that time based on a $500,000 home owned in December 2008 are: Sydney ($400,825), Melbourne ($338,866), Brisbane ($73,417), Adelaide ($81,029), Perth ($64,096), Hobart ($11,263), Darwin ($109,293) and Canberra ($126,262).</p>
<p>The data clearly shows that the value property for home owners has undergone some massive rises, the increase in inflation and wages has been comparatively more sedate. </p>
<p>Although combined capital city home values have increased by 51.7 percent between December 2008 and April 2016, inflation has increased by a significantly lower 17.1 percent over the period. CPI has increased by a greater amount than values in Brisbane, Adelaide, Perth and Hobart indicating ‘real’ home values have fallen. Meanwhile in Sydney, Melbourne, Darwin and Canberra CPI growth has lagged that of home value growth. </p>
<p>Looking at wages growth between December 2008 and March 2016, the data shows that nationally, and in New South Wales, Victoria and the ACT, it has lagged value growth across the capital cities; wages are now growing at their slowest pace in at least 18 years. </p>
<p>While the increases highlighted include strong wage increases in the latter part of the mining boom, nonetheless, it shows that in NSW and Vic wages are increasing at a much slower pace than home values in Sydney and Melbourne are. </p>
<p>The last chart shows the change in the value of new lending (excluding refinances) to investors, owner occupier first home buyers and subsequent buyers between December 2008 and March 2016, and highlights how the value of lending to owner occupier first home buyers is now lower than it was in December 2008 across each state and territory. </p>
<p>This has occurred despite the increase in home values over the timeframe.</p>
<p>While lending to owner occupier first home buyers has fallen, lending to investors and subsequent buyers has increased in most states and territories with substantial rises in NSW and Vic.</p>
<p>Outside of Sydney and Melbourne home values have increased below or at a similar pace to inflation and wages, however, it is a very different story in the two largest capital cities where existing Sydney and Melbourne home owners have seen significant increases in the ‘real’ value of their home.</p>
<p>Those that do not yet own a property will struggle to compete with investors and upgraders who have been active in the market and where significant equity has been acquired.</p>
<p><a href="/images/2016/05/25/Screen%20Shot%202016-05-26%20at%203.36.10%20PM.png" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/05/25/Screen%20Shot%202016-05-26%20at%203.36.10%20PM.png" alt=""></p>
<p>The simple answer for first home buyers, particularly in Sydney and Melbourne, is to look to buy properties outside of these cities however, that may seem a little simplistic given jobs creation has not been as strong outside of Sydney and Melbourne and for many moving interstate, employment opportunities are generally a big decision.</p>
<p>Even buying outside of Sydney in nearby regional cities may not be attractive because transport infrastructure does not provide quick and efficient access to Sydney and Melbourne from nearby regional cities. </p>
<p>Whatever the outcome, we certainly don’t advocate for the return of grants for first home buyers as they have tended to just push up the cost of housing.</p>
<p><span><em>Cameron Kusher is research analyst for CoreLogic RP Data. You can contact him <a href="https://blog.corelogic.com.au/about/">here</a>.</em></span></p>
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Investors and owner occupiers keeping first home buyers out of market: CoreLogic RP Data's Cameron Kusher

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<p>So you’ve decided it’s time to embark on a property development. Great stuff – you’ve made the first of many, many, many decisions for your exciting development journey.</p>
<p>So here are some more decisions to make.  The very first question you’ll need to answer is, ‘what is your development strategy?’</p>
<p>It’s a good question that only you can answer but it also leads straight into a whole list of more crucial questions:</p>
<p>1  Budget – cash available and how much can you finance?</p>
<p>2  Risk profile – do you have a low or high tolerance for risk?</p>
<p>3  Time – how much time do you have available to run your development?</p>
<p>4  Knowledge – do you understand the different development processes?</p>
<p>5  Skills – project management, negotiation, communication, patience </p>
<p>Once you have answers to the above, you can then work out your development strategy.</p>
<p>Your strategy may include:</p>
<ul>
<li>Land Subdivision</li>
<li>Renovate and add value to an existing dwelling</li>
<li>Dual occupancy or low density development</li>
<li>Renovate an existing dwelling and also build new dwellings on the land</li>
<li>Medium density development</li>
</ul>
<p>The development strategies above will all have a different impact on your crucial questions.</p>
<p>Let’s start with Budget. If you are on a low budget then you may choose a house renovation. For this strategy you’ll need to have lots of question 3 as house renovations can be very time consuming.</p>
<p>If your budget is higher, then you may choose a low or medium density project. This choice of strategy will mean you’ll need a high tolerance for number 2 and lots of number 5.</p>
<p>Whichever development strategy you choose; you will need some help. Now it’s time to put together your team.</p>
<p>Who do I need on my Development Team?</p>
<ul>
<li>Property Specialist Accountant &amp; Solicitor</li>
<li>Finance Broker or personal banker</li>
<li>Surveyor</li>
<li>Architect/draftsperson</li>
<li>Builder and other tradesmen; plumber, electrician, carpenter, landscaper</li>
<li>Consultants such as an engineer and private certifier</li>
<li>Quantity Surveyor</li>
</ul>
<p>And if you are short on crucial question number 5:</p>
<ul>
<li>Development Project Manager who will guide you through the entire process</li>
</ul>
<p>Congratulations, you have now answered the crucial questions, decided on a development strategy and built your development team. The next step is to find your development site; you’ll find this raises a whole new series of questions. Have fun!</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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5 crucial questions to answer before starting your development: Jo Chivers

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<p>While home value rises have been moderate over recent years outside of Sydney and Melbourne, it provides little comfort for first home buyers in the two largest cities who struggle to compete with those that already own homes.</p>
<div>
<p>In 2008, combined capital city home values fell by -6.1 percent in the space of 9 months. By the end of the year, home values had reached and began to climb thereafter.</p>
<p>The drivers of this growth was largely two forms of stimulus: aggressive interest rate cuts and a boost to the First Home Owners Grant (FHOG). Since the boost to the FHOG was removed and many of the existing grants were removed or scaled back, first home buyers have continued to languish at near record low levels. The harsh reality is that first home buyers are struggling to compete with those who already own a home or who are investing.</p>
<p>The first chart highlights the increase in home values across each capital city from December 2008 to April 2016. Another way to think about this is that if in December 2008 you owned a home worth $500,000 it is now worth $758,418 which is $258,418 more than in December 2008. Looking at this same calculation across each capital city, the increases in value over that time based on a $500,000 home owned in December 2008 are: Sydney ($400,825), Melbourne ($338,866), Brisbane ($73,417), Adelaide ($81,029), Perth ($64,096), Hobart ($11,263), Darwin ($109,293) and Canberra ($126,262).</p>
<h3>Cumulative change in home values<br>December 2008 to April 2016</h3>
<p><a href="/images/2016/05/30/2016-05-30---img1.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/05/30/2016-05-30---img1.jpg" alt=""></p>
<p>While the value of a home owner’s property has undergone massive rises, the increase in inflation and wages has been comparatively more sedate.</p>
<h3>Cumulative change in CPI (inflation) <br>December 2008 to March 2016</h3>
<p><a href="/images/2016/05/30/2016-05-30---img2.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/05/30/2016-05-30---img2.jpg" alt=""></p>
<p>Although combined capital city home values have increased by 51.7 percent between December 2008 and April 2016, inflation has increased by a significantly lower 17.1 percent over the period. CPI has increased by a greater amount than values in Brisbane, Adelaide, Perth and Hobart indicating ‘real’ home values have fallen. Meanwhile in Sydney, Melbourne, Darwin and Canberra CPI growth has lagged that of home value growth.</p>
<p>Looking at wages growth between December 2008 and March 2016, it shows that nationally and in New South Wales, Victoria and the ACT it has lagged value growth across the capital cities. It should be noted that wages are now growing at the slowest pace in at least 18 years and that the increases highlighted do include strong wage increases in the latter part of the mining boom. Nonetheless, the data highlights that in NSW and Vic wages are increasing at a much slower pace than home values in Sydney and Melbourne are.</p>
<h3>Cumulative change in Wage Price Index<br>December 2008 to March 2016</h3>
<p><a href="/images/2016/05/30/2016-05-30---img3.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/05/30/2016-05-30---img3.jpg" alt=""></p>
<p>The final chart shows the change in the value of new lending (excluding refinances) to investors, owner occupier first home buyers and subsequent buyers between December 2008 and March 2016. The chart highlights how the value of lending to owner occupier first home buyers is now lower than it was in December 2008 across each state and territory. This has occurred despite the increase in home values over the timeframe. While lending to owner occupier first home buyers has fallen, lending to investors and subsequent buyers has increased in most states and territories with substantial rises in NSW and Vic.</p>
<h3>Change in the value of new lending to investors, FHB and subsequent buyers<br>December 2008 vs. March 2016</h3>
<p><a href="/images/2016/05/30/2016-05-30---img4.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/05/30/2016-05-30---img4.jpg" alt=""></p>
<p>While outside of Sydney and Melbourne home values have increased below or at a similar pace to inflation and wages, it is a very different story in the two largest capital cities. Existing owners of homes in Sydney and Melbourne have seen a significant increase in the ‘real’ value of their home. Subsequently those that do not yet own struggle to compete with investors and upgraders that have been so active in the market and already have significant equity.</p>
<p>The simple answer to this problem is that first home buyers in Sydney and Melbourne should look to buy properties outside of these cities however, that may be a little simplistic. Job creation has not been as strong outside of Sydney and Melbourne and for many moving interstate, employment opportunities are generally a big decision. Even buying outside of Sydney in nearby regional cities may not be attractive because transport infrastructure does not provide quick and efficient access to Sydney and Melbourne from nearby regional cities.</p>
<p>We certainly don’t advocate for the return of grants for first home buyers as they have tended to just push up the cost of housing. Prospective first home buyers are facing some tough choices as they compete with other segments of the market who may have larger budgets or a great deal of equity behind them thanks to a history of strong capital gains. Remaining (or joining) the rental market is one option that many may choose, considering weekly rents are down 0.2 percent across the combined capitals.</p>
<p>Those choosing to rent may decide to make their first home purchase an investment property in a location that is more affordable and better suits their budget. For those first home buyers looking to buy their first home to live in, their options will often be limited to the city outskirts if they are to purchase a detached dwelling, or compromising on space to live closer to where they work and play by choosing a higher density option.</p>
<p><em>Cameron Kusher is research analyst for CoreLogic RP Data. You can contact him <a href="https://blog.corelogic.com.au/about/">here</a>.</em></p>
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Investors, owner occupiers making things tough for first home buyers: CoreLogic RP Data's Cameron Kusher

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<p>Christmas always puts a deadline on things. For Property Bloom this year it's completing four development projects before the big man with the white beard arrives.</p>
<p>Of course our builder and all their tradies are under the pump at this time of year and our job as project managers really comes into play.</p>
<p>Our goal is not only to have the dwellings completed with Occupation Certificates (OCs) issued, but also <strong>tenanted</strong> before Christmas. And I've found a way to achieve this.</p>
<p>It's called supporting your site manager.</p>
<p>Rather than micro manage our site managers which just drives people crazy, we try to help them by giving them a hand. They feel supported and at the end of the day, we are all on the same team striving for the same result: Happy clients.</p>
<p>Here's an example. I'm doing two Practical Completion (PC) inspections this week and I have a tool I'm going to take along that should help. It's a bottle of Spray and Wipe.</p>
<p>Because we are pushing the process, we'll often get asked to move the PC date so they can be completely ready. But I don't want to give our builder another few days. Because right now, we literally don't have them.</p>
<p>We want tenants settled in before Christmas, we need the properties to look their best because on the same day we do our PC inspection, our appointed property manager will be taking photos and uploading the properties onto the Internet. This way we can advertise for tenants during the PC and Handover period.</p>
<p>The Handover period is the time after PC when the builder has seven days to complete any outstanding items we've picked up and before the bank pays the builder's final drawdown. Once the builder receives their payment, they release the keys to the owner and the dwellings come off construction key. That is literally the Handover date and of course a tenant can't move in before Handover.</p>
<p>Once asked to pay the final invoice, the bank typically take about a week, sometimes longer to send their valuer to check construction has been completed then transfer the money to the builder.  Before they release the final payment, they will have conditions such as receiving a copy of the OCs, and a copy of a building insurance policy in the name of the owners. </p>
<p>This week or two is valuable and we use it to show potential tenants and hold open homes. We can do this because we have a great relationship with out builder and they will allow access BEFORE Handover. That's pretty unusual for a builder. But it means tenants are lined up as keys are handed over, which results in zero vacancy time for our clients.</p>
<p>So back to the PC inspection. My theory is that we set a date for PC and we do all we can to get the project to that stage. By having a deadline, more action is taken. I've found that there ends up being only minor items to attend to if any at all, because the site manager has done all he could to meet the deadline.</p>
<p>Short of bringing a pair of white gloves, I am fussy at these inspections. But some things just need a bit of elbow grease. So the bottle of Spray and Wipe comes out and we can clean the spots as we go through the property. It's so much easier than adding it to a list and having to wait for cleaners to come back. Of course I do draw the line at mopping floors, but small marks can easily be removed along with the fine layer of dust that always seems to settle on the kitchen benches a day after the construction clean is done.</p>
<p>I'm looking forward to Christmas this year but there's still a bit of work to be finished before the champagne is poured and prawns are peeled. </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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Countdown to construction completion: Jo Chivers

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<p><span>There were 2,948 auctions held across the combined capital cities this week, with a preliminary auction clearance rate of 59.3%. </span></p>
<p><span>Last week, a clearance rate of 57.3% was recorded across 3,252 capital city auctions, the lowest clearance rate since February 2013. At the same time last year, both auction volumes and the auction clearance rate were stronger, with a clearance rate of 65.5% across 3,511 residential auctions.</span></p>
<p><a href="/images/2015/12/14/20151214-Capital-city.jpg" target="_blank"><span>Click to enlarge</span></a></p>
<p><span><img src="/images/2015/12/14/20151214-Capital-city.jpg" alt="" width="754" height="568"></span></p>
<p> </p>
<p><span>Across </span><strong>Melbourne</strong><span>, 1,561 homes were taken to auction this week, compared to 1,622 last week, while the clearance rate strengthened slightly to 65.7%, up from 63.3% over the previous week. Looking back at last year, a clearance rate of 68.6 per cent was recorded across 1,585 auctions. Of the 9 individual Melbourne sub-regions, this week the strongest performer, in terms of clearance rate was the Inner South region. So far, CoreLogic RP Data has collected 193 results for the region and the preliminary result shows 72.5 per cent of these auctions were successful.</span></p>
<p><a href="/images/2015/12/14/20151214-Melbourne.jpg" target="_blank"><span>Click to enlarge</span></a></p>
<p><span><img src="/images/2015/12/14/20151214-Melbourne.jpg" alt="" width="849" height="569"></span></p>
<p> </p>
<p>I<span>n </span><strong>Sydney</strong><span>, 869 auctions were held this week, down from 1,070 over the previous week. The preliminary clearance rate of 55.2 per cent is an improvement, compared to last week, when the final auction clearance rate for the city was 52.9 per cent, the lowest clearance rate Sydney has seen since December 2012. Despite the slight strengthening over the week, Sydney’s current clearance rate remains significantly lower than one year ago, when a clearance rate of 69.8 per cent was recorded across 1,357 auctions. Looking at the sub-regions of Sydney, the Inner West region recorded the strongest clearance rate of 74.6 per cent across 55 auctions, while the Inner South West region had the highest volume of auctions (126).</span></p>
<p><a href="/images/2015/12/14/20151214-Sydney.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2015/12/14/20151214-Sydney.jpg" alt="" width="849" height="573"></p>
<p><strong>Brisbane</strong><span> was host to 180 auctions this week and so far 126 results have been reported, with a preliminary success rate of 46 per cent. Last week, auction volumes across the city were higher with 203 auctions held and a clearance rate of 42.2 per cent. Unlike Brisbane, the number of homes taken to auction this week increased across the </span><strong>Gold Coast</strong><span> with 87 properties scheduled for auction this week, compared to 66 last week. Of the 52 results reported so far, 36.5 per cent were successful.</span></p>
<p><a href="/images/2015/12/14/20151214-Brisbane.jpg" target="_blank"><span>Click to enlarge</span></a></p>
<p><span><img src="/images/2015/12/14/20151214-Brisbane.jpg" alt="" width="818" height="546"></span></p>
<p> </p>
<p><strong>Adelaide</strong><span> recorded a clearance rate of 51.6 per cent across 151 auctions this week, down from a stronger 60 per cent across 138 auctions last week. At the same time last year, 171 homes were taken to auction, with 55.7 per cent recording a successful result.</span></p>
<p><a href="/images/2015/12/14/20151214-Adelaide.jpg" target="_blank"><span>Click to enlarge</span></a></p>
<p><span><img src="/images/2015/12/14/20151214-Adelaide.jpg" alt="" width="799" height="542"></span></p>
<p> </p>
<p>In <strong>Perth</strong>, 58 auctions took place this week, with 25 results reported so far. Perth’s preliminary clearance rate of 40 per cent across these reported results is higher than both last week’s result (36 per cent) and the clearance rate from one year ago (22.5 per cent).</p>
<p><strong>Canberra’s</strong> preliminary auction clearance rate of 48.6 per cent this week is lower than last week, when the final auction clearance rate was 57.5 per cent, and also lower than the 56.9 per cent recorded last year.</p>
<p>There were 17 <strong>Tasmanian</strong> auctions held this week. So far 10 results have been reported with 2 sales.</p>
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Preliminary clearance rate strengthens: CoreLogic RP Data's Shana Miller

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<div>The latest AMP.NATSEM Household Debt report showed that the average household debt in Australia has increased to a new high of $245,000, continuing a prolonged run-up which has seen the average debt per household increase by a factor four since 1988, up from $60,000.</div>
<div> </div>
<div>While the bulk of the rise in mortgage debt has been driven by 30 to 50 year olds, the over 65s cohort also accounts for a fair proportion of the increase in household debt, with more Australians than ever before taking liabilities into retirement.</div>
<div> </div>
<div>Despite this, the latest Australian National Accounts implied that interest serviceability has continued to become easier.</div>
<div> </div>
<div>There are a thousand possible ways to measure this, nine of which is satisfactory: the blue points on the chart below denote interest paid on dwellings as a percentage of total employee compensation minus income tax, while the red points show total interest paid inclusive of consumer debt (excluding unincorporated enterprises) as a percentage of gross household income.</div>
<div> </div>
<div><a href="/images/2015/12/14/Interest.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2015/12/14/Interest.jpg" alt=""></div>
<div> </div>
<div>
<div>You could spend forever debating what should or should not be included in household income (imputed interest on dwellings, benefits receivable etc.) or backed out of gross household income (e.g. other taxes, transfers, insurance premiums etc.) but the results tend to be broadly similar. </div>
<div> </div>
<div>Of course the results generally appear to be "too low" due to the significant number of debt free households. The important thing to note is the trend, which shows that while the mining boom was in full swing the aggregate mortgage interest repayment burden was tending towards excruciating levels by September 2008 (when the official cash rate was still as high as 7 per cent). but since that time serviceability has become relatively speaking very easy.</div>
<div> </div>
<div><strong><span style="text-decoration: underline;">Buffers at record highs</span></strong></div>
<div> </div>
<div>The Reserve Bank of Australia (RBA) has noted in its Financial Stability Review that indicators of household financial stress are presently low, with households pushing ahead on repayments to the extent that aggregate mortgage buffers - as measured by balances in offset and redraw facilities - remain at around 16 per cent of outstanding loan balances, or the equivalent of well over two years of scheduled repayments at current interest rates. </div>
<div> </div>
<div><a href="/images/2015/12/14/Buffers.gif" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2015/12/14/Buffers.gif" alt=""></div>
<div> </div>
<div>
<div>Loan arrears and mortage delinquencies data are also tracking at historically low levels, with favourable delinquency developments having cascaded lower since the 2008 book year. </div>
<div> </div>
<div>A crude comparison the aggregate interest paid to the total stock of outstanding housing credit implies that the average mortgage rate is well under 5 per cent, suggesting in turn that Australians have taken advantage of the very generous fixed rates available through 2015.</div>
<br><div class="separator"> </div>
<strong><span style="text-decoration: underline;">The outlook</span></strong><br><br><div>The first chart above shows the sensitivity of household finances, and especially mortgage repayments, to the unpredictable changes in interest rates. Mortgage repayments are on average clearly very affordable now, but may not be so if interest rates rise sharply.</div>
<div> </div>
<div>The AMP.NATSEM report found that the highest typical debt repayment burdens are to be found in the outer suburbs of our capital cities.</div>
<div> </div>
<div>If interest rates were to rise by 2.5 percentage points - essentially the equivalent of ten interest rate hikes - then the most indebted households could see mortgage repayments rise from 42 per cent of household income to a stress-inducing 58 per cent, while perhaps unsurprisingly the most indebted low income households would be the hardest hit of all.</div>
<div> </div>
<div>An increase in interest rates of 2.5 percentage points would also see repayments for the typical first homebuyer rising from 21 per cent to 30 per cent of household income, or a shade over an extra $8,000 per year.</div>
<div> </div>
<div>There are few indications that the official cash rate is set to move materially higher any time soon, although shifts in capital requirements and funding costs may be another matter. </div>
<div> </div>
<div><strong><span style="text-decoration: underline;">Fragile markets</span></strong></div>
<div> </div>
<div>Unemployment rates have generally been trending down since January 2015, although unemployment rates in Western Australia and the Australian Capital Territory are in an uptrend, and the housing market in Darwin looks exceptionally fragile.</div>
<div> </div>
<div><a href="/images/2015/12/14/UERATE.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2015/12/14/UERATE.jpg" alt=""></div>
<div> </div>
<div>
<div>Although household financial stress is currently low, it seems likely that there will be some vulnerable housing markets in 2016, which may include;</div>
<div> </div>
<div>-resources regions and markets, with the terms of trade crunch likely to result in multiple mass lay-offs to add to the winding down of capital investment;</div>
<div> </div>
<div>-suburbs and sub-regions which are experiencing extensive over-building of apartments. particularly inner city high-rise stock, and those areas with already elevated and rising vacancy rates; </div>
<div> </div>
<div>-off-the-plan developments which will be adversely impacted by APRA's tougher deposit measures; and</div>
<div> </div>
<div>-outer suburban fringe locations in Sydney which saw a massive spike in investor activity and rapid price growth in 2015.</div>
<div> </div>
<div>I'd include a generic entry here for "mining towns", but many have been so utterly smashed already, leading to investor defaults and bankruptcies, since not only were prices unsustainable, so too were rents, and even tenancies. </div>
<div> </div>
<div><strong><span style="text-decoration: underline;">Auctions</span></strong></div>
<div> </div>
<div>Sydney's preliminary auction clearance rate rebounded a bit to 55.2 per cent this week, with outer suburban markets looking particularly dormant, The strongest auction market was a resurgent inner west, with a strong preliminary auction clearance rate of 74.6 per cent (<em>CoreLogic-RP Data</em>).</div>
<div> </div>
<div>This month's Labour Force data showed that New South Wales economy has generated a seasonally adjusted +176,000 jobs over the past year, for an outrageous employment growth rate of +4.9 per cent (trend +160,000 jobs, or +4.4 per cent). The Detailed Labour Force figures, which provide more colour by city, region and industry will be released on Thursday. So stay tuned for that and more this week. </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>
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Record household debt of $245,000: Pete Wargent

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<p><span style="line-height: 1.3em;">Over the 10 years to January 2016, home values across the combined capital cities have increased by a total 72.0% which is well short of values doubling over the decade. </span></p>
<p><span style="line-height: 1.3em;">If we look at the split between houses and units, house values are 73.1% higher compared to a 64.3% increase in unit values.</span></p>
<p><span>Although combined capital city home values haven’t doubled over the past decade, the previous decade was quite a different story. Between January 1996 and January 2006 combined capital city home values increased by 151.7% with house values up 159.6% and unit values 110.1% higher. Based on this data, the most recent decade of capital city home value growth has been half that of the previous decade. </span></p>
<p><a href="/images/2016/02/11/Screen%20Shot%202016-02-11%20at%201.14.30%20PM.png" target="_blank"><span>Click to enlarge</span></a></p>
<p><span><img src="/images/2016/02/11/Screen%20Shot%202016-02-11%20at%201.14.30%20PM.png" alt=""></span></p>
<p><span>At a combined capital city level, the index is weighted so it is therefore heavily influenced by the performance of the larger capital cities. Taking a look at value growth over the past decade across individual capital cities shows a diversity in results.</span></p>
<p><span>Melbourne is the only capital city housing market where home values doubled over the past decade. In fact, many cities are a long way from having doubled with values in Brisbane, Adelaide, Perth, Hobart and Canberra having all increased by less than 50% over the past decade. Home values in Sydney and Darwin have each recorded increases of more than 75% over the past decade however, they too fell well short of seeing values double over the decade.</span></p>
<p><span>Over the previous decade (10 years to January 2006) home values more than doubled across each capital city (note that Hobart values are for houses only and data is not available for Darwin). </span></p>
<p><span>In fact, value growth over the previous decade was more than three times greater than over the most recent decade in Brisbane, Adelaide, Perth, Hobart and Canberra while nationally it was more than double the rate of value growth over the past 10 years. Even Sydney and Melbourne recorded much stronger home value growth over the previous decade compared to the past decade. </span></p>
<p><span>Looking at value growth over the five years to January 2016, it looks unlikely that by the time January 2021 rolls around that home values would have doubled over the decade in any of the capital cities. Over the past five years, Sydney and Melbourne are the only capital cities in which home values have increased by more than 10% with values lower in Hobart and Darwin.</span></p>
<p><a href="/images/2016/02/11/Screen%20Shot%202016-02-11%20at%201.15.41%20PM.png"><span>Click to enlarge</span></a></p>
<p><span><img src="/images/2016/02/11/Screen%20Shot%202016-02-11%20at%201.15.41%20PM.png" alt=""></span></p>
<p><span>While there was a time when home values doubled over a 10 year period the data suggests that the days of such rapid value rises are behind us. It’s important to remember that in recent times we have had record low mortgage rates yet that has failed to spark any substantial home value growth outside of Sydney and Melbourne. </span></p>
<p><span>With little wage growth and ongoing economic uncertainty it is clear that in most areas of the country there are limits to what people can pay for housing. Subsequently there has been little impetus for any significant value growth outside of the two largest capital cities. Even in Sydney and Melbourne value growth has been substantially lower over the past decade than over the previous decade.</span></p>
<p><em>Cameron Kusher is research analyst for CoreLogic RP Data. You can contact him <a href="https://blog.corelogic.com.au/about/" target="_blank">here</a>.</em></p>
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Property values – do they double every decade? Cameron Kusher

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<p>When I keep thinking about the possible ramifications with Bill Shorten’s tax reform announcements I shake my head with utter disbelief – this is just plain dumb policy. Since the mining boom collapsed property has been a major shining light for the Australian economy.</p>
<p>By announcing that from July 1, 2017 negative gearing will only apply to new properties, the argument that 93 per cent of negative gearing goes to existing properties is a flawed one. Many suburbs see very few new developments each year so it’s those existing properties that add equilibrium to keeping rents competitive.</p>
<p>It should also be noted that it was not mentioned that with the new properties that there would be no adjustments to the previous Labor policy in 2008 that permits 100 per cent of off – the – plan purchases to foreign owners. What we are seeing today is new developments being offered off shore and many properties never hit the local market with many of these properties being land banked. It should also be legislated that all off – the – plan foreign purchases must be rented out with all properties that are currently land banked to be issued with a divestment order unless they are rented out.</p>
<p>What I believe will happen with negative gearing is that we will see a cap put on the number of properties that are allowed to be claimed as well as a limit to annual tax deductions that can be claimed. In the meantime one could expect property investors to be front and centre in the markets prior to the upcoming Budget announcements.</p>
<p>It is becoming pretty obvious that it will be some time before the Australian budget gets itself back in the black – more particularly now that an increase to the GST has been formally pooh – poohed.</p>
<p>Instead of looking at increasing taxes maybe the federal Government would be better suited to looking at what it can do with its massive property portfolio to pay down more debt. The Australian Government is the largest property landlord in Australia with property holdings across the country.</p>
<p>HMAS Penguin for example which occupies some prime Middle Harbour front land is just one of thousands of examples of land that could be put to much better economic use. Now before you start yelling and screaming all I am saying is that the federal Government should be taking a closer look at its property portfolio with a view to possibly cashing – in. The NSW Government has been active over the past few years selling off Housing Commission properties that has eventuated in quadrupling budget expectations on the likely market values.</p>
<p>Australia’s population hit 24,000,000 this week so it makes plenty of sense to start a conversation on how our cities are going to cope with this rapid expansion. Public golf courses will come under huge pressure to remain with their respective land values going through the roof. Although before we see those being developed the federal Government has thousands and thousands of hectares of vacant land sitting idle.</p>
<p>No doubt some will say it’s time to put Australia’s land resources to better and more practical use and many will say it should remain as it is. One would have to admit that it would be an interesting debate. The Australian population clock now adds one extra person to our population every one minute and 31 seconds. On top of that we also have record net overseas migration. Our population growth is now higher than that of Indonesia.</p>
<p>The reality is that we need to start developing more land, so that conversation should start with Australia’s biggest landlord.</p>
<p>No time like the present to start this long overdue conversation.</p>
<h5>MOSMAN – 2088</h5>
<p>• Number of houses on the market this time last year – 79</p>
<p>• Number of houses on the market last week – 53</p>
<p>• Number of houses on the market this week – 59</p>
<p>• Number of apartments on the market this time last year – 52</p>
<p>• Number of apartments on the market last week – 46<br>• Number of apartments on the market this week – 44</p>
<h5>CREMORNE – 2090</h5>
<p>• Number of houses on the market this time last year – 8</p>
<p>• Number of houses on the market last week – 17</p>
<p>• Number of houses on the market this week – 18</p>
<p>• Number of apartments on the market this time last year – 19</p>
<p>• Number of apartments on the market last week – 17</p>
<p>• Number of apartments on the market this week – 22</p>
<h5>NEUTRAL BAY – 2089</h5>
<p>• Number of houses on the market this time last year – 5</p>
<p>• Number of houses on the market last week – 9</p>
<p>•Number of houses on the market this week – 7</p>
<p>• Number of apartments on the market this time last year– 38</p>
<p>• Number of apartments on the market last week – 27</p>
<p>*Number of apartments on the market this week – 28</p>
<p> </p>
<p><span> </span><em><span>ROBERT SIMEON</span> is a director of </em><em><a href="https://www.rwm.com.au/" target="_blank" title="RWM" rel="nofollow">Richardson Wrench Mosman and Neutral Bay</a> </em><em>and has been selling residential real estate in Sydney since 1985. <br>He has also been writing real estate blog </em><em><a href="https://www.rwm.com.au/news/" target="_blank" title="Virtual Realty News" rel="nofollow">Virtual Realty News</a> </em><em>since 2000. </em></p>
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robertsimeon-hRNTwJyXkQ

Property is the gift that keeps on giving: Robert Simeon

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<div>It's mainly a been a week of furious tax debate. Admittedly it's been quite a few years since I was employed in a tax position of any note, and even longer since I sat my tax exams.</div>
<div> </div>
<div>No matter, for almost everyone in Australia is a tax expert, and nearly all of us are in agreement that someone needs to pay more tax...just as long as it isn't us!</div>
<div>
<br>Higher stamp duty levies, land tax, income tax, capital gains tax, imputed rental charges, corporation taxes, and superannuation taxes are just a handful of the tolls and contributions being demanded by the baying mob. We are suddently all sure loving the idea of higher taxes!<br><br>A couple of things I can recall from studying tax, particularly with regards to the interdependent sectors of the housing market, are that firstly it's far easier to tweak tax rates and sections of the tax legislation than it is to rip them up entirely, and secondly most modelling and scenario analysis falls over miserably because it fails to account accurately for behavioural change triggered by new tax legislation. </div>
<div> </div>
<div>To be frank, I'll believe any fundamental changes when I see them. Deductibility of mortgage interest for investors has effectively been a bi-partisan policy for decades, and it's only now in Opposition that the ALP is proposing a second stab at grandfathering negative gearing rules. My guess is that the most likely change to housing market taxes would be caps on deductibility, but that really is just a guess.</div>
<div>
<br><strong><span style="text-decoration: underline;">Record residential construction boom</span></strong>
</div>
<div> </div>
<div>Perhaps the most curious part of the entire issue is the timing. A surge of investor lending has seen rental growth careering to 20 year lows, and with the supply response now in full swing a record nadir is almost certainly in the post. In fact, we're already there according to CoreLogic-RP Data's data series.<br><br>It's a well worn argument that investors don't add to the dwelling stock, but if you've ever worked in the development space you'll know that developers don't <span style="text-decoration: line-through;">give a</span> <span style="text-decoration: line-through;">care a toss</span> give a fig whether a property is bought by a homeowner or an investor, negatively geared or otherwise.<br><br>What creates new supply is declining financing costs, rising demand in aggregate, and thus rising prices, and as this cycle has progressed we have been getting all of these in spades, particularly resulting in a surge of new units, townhouses &amp; apartments, which in turn has already cooled these parts of the housing market naturally.<br><br>The strongest prices gains have been seen in Sydney and Melbourne and these cities have played host to the bulk of the supply response, though a combination of rising prices, low interest rates and, let's be blunt about this, a fresh market of Chinese mainland buyers of new apartments, has seen construction activity increase sharply in Brisbane and elsewhere too.<br><br>Only a couple of years after the system was apparently busted (which would allegedly march us into a recession) residential construction activity hit its highest ever level. So much for negative gearing restricting the dwelling stock - it's the greatest residential construction boom on record!</div>
<div> </div>
<div><a href="/images/2016/02/23/A5.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/02/23/A5.jpg" alt=""></div>
<div> </div>
<div>
<strong><span style="text-decoration: underline;">Rents?</span></strong><br><br><span>As for whether falling demand from investors would lead to rents rising, logically the answer is obviously "yes" as rental supply diminishes, for not all renters want to buy, and many could not afford to do so without borrowing the full purchase price and associated closing costs, a dynamic regulators have been nervously edging away from ever since the financial crisis.</span><br><br><span>Unfortunately I don't have much hard Australian-based evidence upon which to base this assertion, since there have only been two instances where rents have spiked in Australia over the 33 years of available data, but one might reasonably expect that these coincided with downturns in investor activity.</span>
</div>
<div><span> </span></div>
<div><a href="/images/2016/02/23/A2.jpg" target="_blank"><span>Click to enlarge</span></a></div>
<div><span><img src="/images/2016/02/23/A2.jpg" alt=""></span></div>
<div> </div>
<div> </div>
<div>
<div>Incidentally, another quirky facet to the negative gearing debate has been the so-termed "Fact Check" articles which instruct us that rental growth indices "must" be adjusted for inflation i.e. the price of consumer goods (such as the price of cheese, pork, sewerage costs, goat, and so on). "Must" they, fact checkers? According to whom are these "facts" actually facts?<br><br>While there may conceptually be a very loose relationship between inflation and rental price growth, at best it is a link bound by a mile-long rubber band. I've never once come across a landlord adjusting rents for the growth in price of a tub of ice cream, or a dozen eggs, or a packet of smokes, the price of having a root canal, or whatever. It's an absurd notion, really.<br><br>Typically rental price growth is simply one function of the wider property market cycle, specifically supply (the number and type of rentals available for lease) and demand (the volume of renters in the market, and the product collectively in demand from them), although household income growth does indirectly play its part.</div>
<br><div>We can see in the chart below that investor lending more than halved from $0.210 billion in May 1985 to $0.099 billion by early 1986, so evidently the amendments to the tax legislation at that time did change investor behaviour, while dwelling starts also immediately collapsed as charted here previously.</div>
<br><div>Unfortunately the ABS data on investor loans is sawn off at January 1985, so it's not possible for me to put the drop into a wider context, although if you believe what property-loving folk wrote nearer to that time, investor sentiment fell dramatically, which contributed to rent increases in Sydney and Perth in the short space of time that interest deductibility was quarantined.</div>
<div> </div>
<div><a href="/images/2016/02/23/A3.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/02/23/A3.jpg" alt=""></div>
<div> </div>
<div>
<span>The inverse link between investor activity and rental price growth in these two charts above could not be any clearer.</span><br><br><span>Moreover, the property markets of today aren't readily comparable unless population growth is dialled back, since in the major markets of Sydney and Melbourne absolute population growth is much higher. Victoria's population grew by 42,781 in 1985, for example, but has been tracking at around 2.5 times that level recently.</span><br><br><span>Mostly old ground. But what about more recently when annualised rental growth soared to 8.4 per cent in December 2008? Was there also a dip in investment lending then which led to the rental supply shortage and some wrecthed rent increases in parts of Sydney and elsewhere?</span><br><br><span>Again, clearly yes, the figures show that investor lending all but halved from $10.1 billion in June 2007 to just $5.1 billion by January 2009, coinciding exactly with the spike in rents as investors deserted the market, spooked by the onset of the global financial crisis and various predictions of a crash by market commentators.</span><br><br><span>As you can see in the chart below, investor lending rebounded strongly from the month of February 2009, which was the month within which Kevin Rudd announced his famous $42 billion stimulus package, and rental growth quickly cooled again.</span>
</div>
<div><span> </span></div>
<div><a href="/images/2016/02/23/B2.jpg" target="_blank"><span>Click to enlarge</span></a></div>
<div><span><img src="/images/2016/02/23/B2.jpg" alt=""></span></div>
<div> </div>
<div> </div>
<div>
<div>Overall the figures suggest that sharp rental price increases do follow declines in investor activity, pretty much exactly as you would expect.<br><br><strong><span style="text-decoration: underline;">Recent pullback</span></strong><br><br>At the end of the above chart, we can see that monthly investor lending has recently fallen from a peak of $15.5 billion in June 2015 to $12.6 billion by December. Despite this pullback, which was driven by APRA's interventionary measures, I actually don't see strong rental growth returning any time soon for a few reasons. </div>
<div> </div>
<div>Firstly because the rate of dwelling construction and work in the pipeline remains at very high levels. Secondly because such a high proportion of new dwellings is presently being bought by foreign buyers (and thus are not captured by this data). And thirdly because I also have a sneaking suspicion that a fair percentage of deemed "owner-occupiers" are magically switching to become investors post-purchase.<br><br>There may also be some small impacts from subtle shifts in rental practices such as the growth of Air B&amp;B, although these will surely be less influential than the key trends.</div>
<div> </div>
<div>Overall, despite media articles assuring us over and over again that hosing down investor activity would not lead to increasing rents, market experience tells me that in the largest capital cities this is precisely what would play out. </div>
<div><strong><span style="text-decoration: underline;"> </span></strong></div>
<div><strong><span style="text-decoration: underline;">Changes to tax?</span></strong></div>
<div> </div>
<div>Penultimately, few figures have been tortured more enthusiastically of late than those showing who claims negative gearing benefits or deductions for net rent. Of course, the highest deductions in dollar value terms are claimed by high income earners, since this cohort pays the highest rate of tax - and thus the most tax - and also tends to buy more expensive rental properties, which naturally have a weaker rental return. </div>
<div> </div>
<div>The data presented objectively by Cameron Kusher of CoreLogic-RP Data below show that negative gearing is used right across the spectrum of taxpayers by income bracket, although it <strong><em>is </em></strong>true that you are more likely to claim net rent deductions if you have taxable income of $80,000 or above (25.8 per cent of taxpayers in this cohort) than if you earn $80,000 or below (13 per cent).</div>
<div> </div>
<div><a href="/images/2016/02/23/ATO.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/02/23/ATO.jpg" alt=""></div>
<div> </div>
<div>
<div>This rings true. From my own experience, none of my friends owned a rental property when we worked in part time jobs at university or in the years immediately after high school, but a fair few did so over time as they grew older, got full time and better paying jobs, met life partners who were incumbent property owners, and so on.</div>
<div> </div>
<div>The figures show that the overwhelming majority of taxpayers with rental properties never own more than one property, and most of the remainder own only two (this can easily happen by default as a couple leave their respective starter home apartments in order to cohabit), while my experience in the market tells me that everyday people in full time employment claim rental deductions just as frequently as CEOs and surgeons. You can see this for yourself every weekend at opens and auctions. </div>
<div> </div>
<div>In this regard, market experience is as instructive as the tortured data. Not dissimilarly it was obvious during the so-called "homebuyers strike" in Sydney that every second person who called me was a first-time buyer, but rightly or wrongly they were buying an investment property as a first step onto the ladder rather than a home (and as such were not being captured or classified as "homebuyers").</div>
<div> </div>
<div>There have been calls to halve the capital gains tax discount, but with a Coalition Prime Minister with a net worth of well over $100 million, this seems to me to be a seriously remote prospect.<br><br>It's worth noting that the introduction of the capital gains tax discount did not halve tax payable as is frequently implied, rather it replaced the old indexation of the cost base system which ran from 1985 and was not discontinued until 1999, inflicting a searing pain upon tax exam students and preparers of tax returns alike.<br><br>Capital gains tax (CGT) is a crappy tax, especially when it does not account for inflation, effectively a punitive double <a href="https://www.themoneyillusion.com/?p=7091" target="_blank">taxation of savings</a> which discourages investment. The optimal rate of CGT is zero. In any case new housing is already one of the most heavily taxed commodities there is.</div>
<br><strong><span style="text-decoration: underline;">New builds?</span></strong><br><br><div>Finally, on paper, Labor's proposal to limit negative gearing deductions to new builds sound plausible, but in practice this would simply replace one market distortion with another. In particular buyers of new-build investment properties benefitting from tax deductions would discover that their resale market had been ripped out from underneath them, effectively leaving them sitting on six-figure paper losses or "negative equity" from the date of settlement.</div>
<div>
<br>Indeed this already happens to buyers of new properties today, albeit to a less dramatic extent, which is why in the absence of homebuyer grants for new builds developers often sell to self-managed super funds lured by tax incentives and bad advice from accountants, or to foreign buyers. Chris Bowen's assertion that buying new property is not "in any sense" more risky than buying established is discredited by all available research.<br><br>Most of the debate this week has really been about intergenerational equity rather than budget repair, which is sensible, but perhaps overlooks the high level of supply of construction in the pipeline.<br><br>In my opinion changing negative gearing rules - which after all, is a timing difference rather than a genuine tax concession - would generate close to zero additional tax revenue after behavioural change, reduced stamp duty excise and soaring public housing costs are accounted for. In any event, net rental losses have declined since even in nominal terms in 2008, while net rental profits have increased by well over 50 percent.</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>
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