South East Queensland developer&nbsp;<a href="https://www.apartments.com.au/developers/gardner-vaughan-group">Gardner Vaughan Group</a>’s entry into the Gold Coast apartment market has progressed from pipeline to market, with its Chevron Island project Bronze on Chevron now formally available to purchase ahead of a planned 2029 completion.

The 119-apartment development on Mawarra Street marks the Brisbane-headquartered builder-developer’s first residential play in the Gold Coast, following its expansion south from Brisbane and the Sunshine Coast.

<a href="https://www.apartments.com.au/new-apartments/bronze-on-chevron-8-mawarra-street-surfers-paradise-qld-4217">Bronze on Chevron</a> comprises a mix of two-, three- and four-bedroom residences, with pricing starting from just over $1.5 million. The project is being delivered under Gardner Vaughan’s fully integrated model, with the group acting as both developer and builder, a structure it has consistently applied across its South East Queensland portfolio.

[smartcode_project:default project_id=107520 project_image_fid=367182]

Architecture has been designed by <a href="https://www.apartments.com.au/architects/cottee-parker-architects">Cottee Parker</a>, with landscape architecture by <a href="https://www.apartments.com.au/landscape-architect/jeremy-ferrier-landscape-design">Jeremy Ferrier</a>. The building presents as a single-tower scheme, with a focus on maximising outlook across both the Surfers Paradise skyline and the Nerang River.

Apartments have been planned with open-plan living zones extending to generous balconies, a response to the site’s dual-aspect positioning between river and ocean. Interiors follow a restrained coastal palette, with two colour schemes offered, and an emphasis on natural light and cross-ventilation.

[smartcode_project:default project_id=107520 project_image_fid=367181]

Resident amenity is concentrated across more than 1,250 sqm and includes a resort-style pool, gym, yoga lawn and rooftop entertaining areas. A function space with catering facilities forms part of the upper-level offering, alongside north- and south-facing outdoor areas.

Ground level will incorporate two retail tenancies, intended to extend the existing village character of the surrounding streets.

&nbsp;

[smartcode_project:default project_id=107520 project_image_fid=367200]

The project sits within walking distance of Thomas Drive’s established dining strip, while maintaining proximity to <a href="https://www.apartments.com.au/developments/surfers-paradise-qld-4217">Surfers Paradise</a> beach and broader Gold Coast amenity. The location, positioned on Chevron Island between the river and coastline, has increasingly attracted mid- to high-density development in recent years as the precinct evolves beyond its low-rise origins.

Gardner Vaughan’s move into the Gold Coast was first signalled in 2025, with the group identifying the region as a natural extension of its operations. Chief Executive Officer Simon Betteridge described the expansion as both “strategic and natural”, citing demand for well-designed apartments in lifestyle-driven markets.

Construction is expected to complete in early 2029.

[smartcode_project_cta:default project_id=107520]

Joel Robinson

Gardner Vaughan brings Bronze on Chevron to market as Gold Coast debut

One of the penthouses at Lily Lane, the latest stage of Carrington Place by Ellipse Property, has set a new local apartment price record.

The four-bedroom residence, purchased by a local downsizer, sold for $5.75 million—around 75 per cent higher than the previous record of $3.3 million.

Over 40 per cent of the first release of apartments at&nbsp;<a href="https://www.apartments.com.au/new-apartments/lily-lane-at-carrington-place-castle-hill-32-carrington-road-castle-hill-nsw-2154">Lily Lane</a> have already been snapped up just six weeks since it launched to the market.

&nbsp;

Located at 32 Carrington Road, <a href="https://www.apartments.com.au/developments/castle-hill-nsw-2154">Castle Hill</a> and designed by award-winning architects <a href="https://www.apartments.com.au/architects/ptw">PTW</a>, Lily Lane is directly opposite the Hills Showground Metro station. It offers a total 213 units over two 12-storey towers - a mix of 67 one-bedroom, 100 two-bedroom and 46 three-bedroom apartments - with a ground-floor retail offering.

[smartcode_project:default project_id=151821 project_image_fid=368352]

Blake Schulze, National Director – Residential at <a href="https://www.apartments.com.au/project-marketer/colliers">Colliers</a>, says around 44 per cent of buyers are&nbsp;owner occupiers, with 35 per cent being investors and 21 per cent first homebuyers.

“Developments of this calibre are very rare in the Hills District, and Lily Lane’s sales success demonstrates the depth of demand for over-sized apartments that genuinely compete with freestanding homes," Schulze says.

"We are seeing particular demand from downsizers who want to remain in the area but transition into spacious, high-quality apartment living."

On the penthouse sale, it says it shows buyers&nbsp;are prepared to pay a premium for scale, quality, and direct access to the Metro.

[smartcode_project:default project_id=151821 project_image_fid=368351]

One-bedroom apartments are sized from 50-72 sqm with prices starting at $745,000, while two-bedrooms are priced from $990,000 with sizes from 75 to 132 square metres. Three-bedroom floorplans are sized between 97 and 182 sqm,, with prices starting at $1,395,000.&nbsp;

The three remaining penthouses, spanning up to 262 sqm, are priced from $2.9 million.

Over 75 per cent of apartments include dedicated studies, multipurpose rooms or family rooms, with select layouts offering walk-in pantries and laundries. Apartments are appointed with premium Miele appliances including ovens, washing machines, dryers, gas cooktops and dishwashers, while larger residences also incorporate integrated Miele microwaves, Fisher &amp; Paykel integrated refrigerators and five-burner Miele cooktops.

[smartcode_project:default project_id=151821 project_image_fid=360285]

Lily Lane will be constructed by award-winning iCIRT-rated builder <a href="https://www.apartments.com.au/builders/decode">Decode Group</a>, with construction to commence in mid-2026 and expected to complete early 2029.

Carrington Place comprises more than 800 apartments and is being delivered across multiple stages, with completion expected in 2032. Integrated with neighbouring bushland, the project will feature over 20,000 sq, of outdoor recreational area, including a one-kilometre boardwalk to Fred Caterson Reserve.&nbsp;

The Hills Showground Metro Station is just a two-minute walk away, offering fast connectivity to Sydney’s CBD, North Sydney, Chatswood, Macquarie Park and Norwest Business Park.

[smartcode_project_cta:default project_id=151821]

Ellipse sets Castle Hill apartment record with $5.75 million Lily Lane penthouse sale

Fresh off completing its Delano Crows Nest development, Lindsay Bennelong has lodged plans for its next project, this time turning its attention to the beach.

The developer, founded by Clarendon Homes founder Peter Campbell, is proposing a 37-apartment scheme at <a href="https://www.apartments.com.au/new-apartments/17-25-ashburner-street-manly-nsw-2095">17-25 Ashburner Street</a>, Manly, positioned between the southern end of <a href="https://www.apartments.com.au/developments/manly-nsw-2095">Manly</a> Beach and East Manly Cove.

Lindsay Bennelong called on local architecture firm Platform Architects to design the new building, given their success on The Finn, Lindsay Bennelong's current luxury apartment project on North Steyne.&nbsp;

According to the Design Verification Statement by Bridie Gough of Platform Architects, the proposal “relates to the current context but also the desired future character of taller buildings suitable to the new planning controls.”

The site has been identified as a Low to Mid-Rise Housing (LMR) location, given its position within 400 metres of the Manly Town Centre E1 Business Zone. The LMR controls are intended to unlock additional housing supply in well-located areas close to public transport, allowing developers to seek increased height limits to support greater density.

“The proposal seeks to provide this increased level of housing whilst being respectful of some of the smaller scale buildings also nearby,” the statement reads.

Lindsay Bennelong Development Director Leigh Manser said the project has been carefully aligned with the intent of the LMR controls. The proposal will significantly increase housing yield on the site, replacing four houses and 10 apartments, comprising 25 bedrooms, with 37 new apartments delivering a total of 94 bedrooms.

“Sydney is in a severe undersupply, and delivering more dwellings and more bedrooms than what currently exists is exactly what the LMR policy is designed to activate,” Manser said, noting that nine of the apartments will be allocated as affordable housing for frontline workers.

“We have already commenced discussions with our community housing provider to determine the rental levels that frontline workers can realistically afford in this location,” he said. “These will need to sit well below the standard affordable housing benchmark of 20 per cent below market rent, and that has been factored into our feasibility and pricing.”

<img alt="Manly" data-entity-type="file" data-entity-uuid="ad03000f-19f9-48b4-b27d-e85ca800a1da" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-04-30%20at%208.41.59%E2%80%AFAM.png?VersionId=a.txHwCZgbCInlQ6QXbIrI.umvW1T.r8" />

The design of the building incorporates a wave-like indentation running through the façade, referencing the nearby coastline and anchoring the building within its local context.

The&nbsp;Design Verification Statement says careful consideration has been given to the articulation of the building, ensuring the bulk is broken down to a more human scale through a defined four-storey podium."

The scheme includes a mix of one-, two- and three-bedroom apartments.

“The design ensures a high level of amenity, with apartments offering generous private open space, many with expansive views, and all with comfortable proportions."

<img alt="Bennelong" data-entity-type="file" data-entity-uuid="6a7f2812-72a1-4959-84b0-997e8cd88aed" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-04-30%20at%2010.15.50%E2%80%AFAM.png?VersionId=6iMxU3MkXmHVHAoNhYBjnqgka8CUZNbk" />

<a href="https://www.apartments.com.au/developers/lindsay-bennelong-developments">Lindsay Bennelong</a>&nbsp;is currently developing Finn Manly, just three full-floor luxury apartments on North Steyne. They recently welcomed residents to its 81-unit Delano Crows Nest development, a&nbsp;carefully scaled infill project designed to bridge&nbsp;<a href="https://www.apartments.com.au/developments/crows-nest-nsw-2065">Crows Nest</a>’s lively village centre with its surrounding heritage streets.

Designed by&nbsp;<a href="https://www.apartments.com.au/architects/ajc-architects">AJC Architects</a>,&nbsp;<a href="https://www.apartments.com.au/new-apartments/delano-crows-nest-27-57-falcon-street-crows-nest-nsw-2065">Delano</a>&nbsp;is arranged across three low-rise buildings, incorporating a mix of one, two, and three-bedroom apartments alongside a limited number of townhomes addressing Hayberry Lane. The architectural approach draws on the area’s Art Deco lineage, reinterpreted through contemporary detailing and framed by landscaped communal gardens.

The developer also has a development site in Maroubra.

First look: Lindsay Bennelong's new Manly apartment development revealed

Fifty-nine residences across 37 levels. No more than two per floor. With 80 per cent now sold, what remains at <a href="https://www.apartments.com.au/new-apartments/madeline-by-mosaic-broadbeach-22-mary-avenue-broadbeach-qld-4218">Madeline by Mosaic</a> is a short list.

Madeline was always conceived at a scale that sits outside the normal register of Gold Coast apartment living. The residences are half- and full-floor configurations, with the largest spanning more than 400 sqm, dimensions that place them closer to the penthouse end of the market regardless of where they sit in the building.

That scale is the organising principle of everything else: how the floorplans are laid out, how the materials read, how the connection between inside and outside works.

[smartcode_project:default project_id=150135 project_image_fid=355941]

The interiors were developed in collaboration with <a href="https://www.apartments.com.au/architects/fraser-partners-0">Fraser &amp; Partners</a>, the architecture practice&nbsp;<a href="https://www.apartments.com.au/developers/mosaic-property-group">Mosaic</a> brought in as design partner for the first time on this project. The palette runs to natural stone, textured timbers, and soft metallics, materials chosen as much for their tactile quality as their appearance.

Light cleverly shifts across surfaces through the day, and the design is explicit about wanting that to be noticed. Full-height glazing runs across the primary living areas, and where the building faces east toward the ocean, those walls of glass are doing real work: framing a view corridor that the site's position directly opposite Broadbeach State School's playing fields keeps permanently open.

That outlook is the site's most consequential asset. In a suburb where new towers continue to rise, a protected view line is genuinely rare, and the Mary Avenue address secures it. Residents at Madeline will look out over open parkland rather than the rear of another building, a distinction that becomes more meaningful with each new development approved nearby.

[smartcode_project:default project_id=150135 project_image_fid=355939]

The private outdoor spaces are sized to match the residences themselves. Terraces on the upper levels frame uninterrupted ocean panoramas, and the planning ensures that living areas extend into those outdoor zones rather than treating them as separate attachments. The flow between the two is part of the design intent, not an afterthought.

Inside, the finish specification reflects the same approach. Rich stone benchtops, warm timber joinery, bespoke hardware, each element specified to hold up over time rather than read as a moment in a particular trend cycle.

[smartcode_project:default project_id=150135 project_image_fid=3409]

Beyond the residences, the amenity offering extends that register. A lap pool and sun deck anchor the outdoor space, alongside a magnesium pool, cold plunge, steam room, and sauna.

A commercial-grade gymnasium, residents' lounge, library, and boardroom round out a programme that functions more like a private members club than a standard building amenity floor.

Construction has commenced under Mosaic's in-house building arm, with completion scheduled for late 2028.

[smartcode_project_cta:default project_id=150135]

Madeline by Mosaic delivers penthouse-level living across every apartment

Developer Fortezza Group is the latest to take its new apartment development, <a href="https://www.apartments.com.au/new-apartments/the-belvedere-5-7-church-street-nelson-bay-nsw-2315">The Belvedere in Nelson Bay</a>, to the NSW Government.

Fortezza, predominantly a South East Queensland developer, is the latest to apply for State Significant Development&nbsp; status through the NSW Government's Housing Delivery Authority, a pathway becoming favoured by developers to speed up the approval process.

They are planning 57 two- and three-bedroom apartments across 5-7 Church Street and 42 Donald Street, near d'Albora Nelson Bay Marina. The diverse apartment mix has sizes from just over 80 sqm to the largest three-bedroom penthouses that reach nearly 200 sqm.

<img alt="Fortezza" data-entity-type="file" data-entity-uuid="090360e1-66d7-43ad-b686-aba81f173bf2" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-04-29%20at%2010.22.40%E2%80%AFAM.png?VersionId=DMqF96eBZolqSAAAcugX0l66ueWng66m" />

Fortezza calls the project a "piece of Istria in Nelson Bay,"&nbsp;referring to the largest peninsula in the Adriatic Sea, shared by Croatia (90%), Slovenia, and Italy, which is known for its Roman history, Venetian-style coastal towns and inland hilltop villages.

They say the The Belvedere is strategically positioned at the apex of Nelson Bay, offering unrivalled views of the ocean, the bay and captivating topography of the area.

"Our commitment to maintaining the integrity of every view and sight line has been relentless," Fortezza Group says.

"Through extensive modelling and analysis, we ensure that each apartment enjoys the natural beauty of Nelson Bay, regardless of future developments. Each design element is carefully curated to harmonise with our European heritage, drawing profound inspiration from the Roman architectural marvels in Istria. The arches, the cascades of greenery and the stonework that define our project pay homage to the structures that once exemplified Roman grandeur."

Residents will have access to a pool, communal green spaces, an office and a coffee shop.

First look: Fortezza Group takes The Belvedere, Nelson Bay apartment development, to NSW Government

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

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

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Few things make me more cynical than the sound of a politician mouthing concern about housing affordability.
In my lifetime, there have been hordes of politicians and governments claiming to want to solve the problem, but none willing to take any real action.
When it comes to improving affordability, many politicians talk a good fight, but none is capable of delivering a knockout punch.
The latest masquerade in this regard is being led by MP Kelly O'Dwyer.
O'Dwyer has obviously watched a few episodes of Yes Minister before deciding on a course of action: bring on an inquiry, issue lots of press releases, target an unpopular minority and take "strong action" against these alleged perpetrators of the perceived problem – but essentially do nothing meaningful so that the status quo remains intact.
The truth is, 40% of the cost of a new house in Australia comprises government fees, charges and taxes. Remove those and the cost of a $400,000 house-and-land package would drop to $240,000.
In all the froth and bubble coming out of the federal inquiry, we haven't heard O'Dwyer or any other politician confront this reality. Why not? Because if they did, their advancement within the party would suffer a sharp U-turn.
Governments are addicted to the revenue they milk from their favourite cash cow, the real estate industry. That's sacred and the possibility of scraping stamp duty, for example, is not up for discussion.
So what to do? How to create the illusion of doing something while changing nothing?
<blockquote>
Many Australians have a big issue with Chinese investors, although they don't seem to mind American, British, Dutch, Italian or New Zealand investors.
</blockquote>
The answer, as always, is this: target an unpopular minority, talk tough, issue lots of press releases, look strong, do nothing. Works a treat every time.
O'Dwyer has a bee in her bonnet about foreign investors. I'm not sure whether she truly believes that foreign investors are the cause of the perceived affordability problem. I seriously doubt that she does, because someone armed with all the relevant information, as she should be, must know that foreign investors are not impacting the price of suburban houses in Australia.
But foreign investors are a great scapegoat, particularly as this currently means Chinese investors. And many Australians have a big issue with Chinese investors, although they don't seem to mind American, British, Dutch, Italian or New Zealand investors.
So tough-talking Kelly is going a come down hard on Chinese investors. It'll be good for some media sound bytes and it'll help to advance the career of a politician no one had heard of until recently.
But will it make housing more affordable? No, it won't change a thing.
A quote from Shakespeare comes to mind: "It is a tale told by an idiot, full of sound and fury, signifying nothing."
Chinese investors are not impacting the price of houses in first-home buyer markets in Australian cities. Overwhelmingly, they are buying high-rise apartments in the CBDs of Melbourne and Sydney, as well as the Gold Coast, which is a perennial favourite for Asian investors who enjoy losing money.
If they're buying suburban houses, it's primarily top-end homes in the millionaire suburbs.
The Federal Government could pass a law tomorrow banning all foreign investment in Australian residential property – and the price of houses in the suburbs of Sydney and Melbourne would not change.
But if they removed the taxation component of a house-and-land package, that would make a dramatic difference.
Any chance of that happening? Not remotely.
This is a publicity exercise. Meaningful change is not on the agenda.
Terry Ryder is the founder of <a href="https://hotspotting.com.au/" target="_blank">hotspotting.com.au</a>. You can <a href="https://mailto:ryder@hotspotting.com.au" target="_blank">email</a> him or contact him on <a href="https://twitter.com/hotspotting" target="_blank">twitter</a>.
 
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terryryder-YECXbqmri2

Pollies prefer to milk the property cow than to make meaningful change

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Recently, the House of Representatives Economic Committee Report on Foreign Investment in Residential Real Estate was released.
The report made 12 key recommendations, one of which was better funding of the Foreign Investment Review Board (FIRB), because currently there is a complete lack of creditable information on the true extent and nature of foreign investment into residential property. As might be expected the report has received a mixed response. It has not been welcomed by the majority of public comments posted on various news websites.
Let’s examine some of the background that led to the committee looking at this area of policy. In a recent post I noted that the local housing construction industry was worth almost $70 billion, employing some 1,037,412 people in 2014. When talking about foreign buyers and residential property I use these figures as a starting point to help illustrate how important this sector is as a driver of our economy, and it’s a point that was repeated in Friday’s report.
The role of foreign investment in our market can be an emotional subject, and it remains so. It is also a very complex issue for a country with a growing population and a somewhat mixed economic outlook.
The Plight of First Time Buyers
There has been clear evidence for some months now that first time buyers are being squeezed out of the housing market. Australian Bureau of Statistics (ABS) finance statistics show that in September 2009 first time buyer finance stood at 26.1%, by September 2010 that figure had fallen to 15.5%. In the most recent ABS figures there was a slight increase but the figure is now down to 12.0%, and the average loan has increased to $326,500, which in the Sydney market would not stretch that far.
Also, in the most recent ABS figures, investment finance for the month grew by 1.7% and owner occupier finance only grew by 0.1%, and this continues a long-term trend. The reasons for these trends are very complex, but on the surface, they do create an emotional picture of the plight of some sections of the housing market.
The emotion is partly illustrated by a <a href="https://www.change.org/p/the-executive-members-toughen-the-regulations-for-foreign-investment-in-australia" target="_blank">current online petition</a> posted on change.org. The petition started in response to the Economics Committee’s review which called on the Federal Government to "toughen the regulations for Foreign Investment in Australia". It attracted some 32,300 supporters (signatures) and a wide variety of mainly sympathetic followers. A key element of the petition was the fact that only 33 of the reported 5000 sales of established homes to foreign buyers over recent years have been investigated by the FIRB.
That’s a very small number and so, understandably, it makes the FIRB rules an easy target. However figures from the FIRB show that in the first nine months of the last financial year foreign residential property investment was $24.8 billion – a 44% increase over the amount approved for the whole of the 2012-13 financial year, which only further points to the fact that the FIRB may be under-resourced.
In the report the committee also made reference to these figures and agreed the FIRB was not doing an acceptable job, which it recommends be fixed.
The petition and the concerns of its sponsor (Simon Hosking) had been brought to the attention of Kelly O’Dwyer, Federal Member for Higgins and Committee Chair of the Parliamentary Business Committee’s House Economics Foreign Investment in real estate. In part of her response, published on the petition’s website and issued ahead of the main report, O'Dwyer states:
“… The Committee is taking a holistic approach to examine whether the current policy settings are delivering the best outcomes for the Australian economy and increasing housing availability, as they are designed to do. Australia’s foreign investment policy, as it applies to residential property, is intended to boost the supply of new housing and thus provide both economic and social benefits. The policy seeks to channel foreign investment in the housing sector into activity that directly increases the supply of new housing (such as new developments of house and land, home units and townhouses) and brings benefits to the local building industry and its suppliers…”
 This article continues on the next page. Please click below.
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Blame game or market reality
The debate around foreign investment in residential property comes at a time when prices and demand have both been increasing, a very obvious trend in Sydney and Melbourne and to a lesser extent in Brisbane and other centres. These cities are also attracting the bulk of foreign buyers and foreign development capital and investment.
In part, the trend is being ‘blamed’ for higher prices and at one end of the market. That blame extends to the trend locking first time buyers out of the market.
Again, ahead of the main report, here’s what Committee Chair Kelly O’Dwyer said in response to the Simon Hosking petition. The  same views were reinforced in the main report:
“…Consistent with this principle, foreign investors are able to seek approval to purchase new dwellings and vacant land for residential development. Foreign investors cannot generally buy established dwellings as investment properties or homes; however, temporary residents can apply to purchase one established dwelling to use as their residence while in Australia. The acquisition of residential real estate by foreign investors is regulated by the Foreign Investment Review Board (FIRB). It has become clear from evidence presented to the Committee that FIRB has not prosecuted a single case since 2006. It is also clear that there are problems with processes at FIRB, resources and the penalty regime. The Committee is due to report later in the year…”
However only last week ahead of Friday’s report, this same committee knocked back a proposal that foreign property buyers be levied an extra stamp duty as a possible way of helping to fix the housing affordability crisis, and dampen offshore demand.
There seems to be a fairly entrenched ‘hands-off’ approach being adopted, although a purchase application fee of $1500, that would raise $158.7 million over four years, appears to have general support. Such a fee would by no means act as a penalty.
Returning to the idea that foreign investment is somehow having a negative impact on the market (by forcing up prices), I think we should also look at how different the Australian economy has become over the past two decades.
Because the housing market is part of a big picture and it has to be seen in the wider context. The importance of direct foreign investment across our economy is illustrated by the fact that in 1990 Direct Inward Investment Stocks was US$80,333 million, however, in 2012 that figure had grown to US$604,257 million. Over the same period Australia’s outward flow of Direct Investment Stocks has grown from US$37,491 million to US$424,489 million. I quote the figures to illustrate the fact that the international flow of investment funds is a fundamental to any economy.
The rush to secure Free Trade Agreements is further evidence of this fact. Last week Australia and China signed an FTA, and it is yet to been seen if this will have any impact on the flow of funds into residential property both buying existing projects and for new developments, and if this will be a positive or not for the market.
On first reading of the China/Australia Free Trade Agreement, because of the freeing up of many of the service sectors, this may well be a positive for Sydney and Melbourne, because these two cities are so closely aligned to the professional services. Law, finance, education, tourism, health, engineering and manufacturing are all seen as having potential benefits and growth in these areas plus other key areas should create more demand for commercial and residential accommodation in Sydney and other cities.
However, again illustrating how emotional this topic has become, there are suggestions that the various free trade agreements will further harm the prospects of ‘local’ would be home-buyers. But I do not see any foundation for this assumption.
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pchittenden-eLqUUC8TWW

The housing market and foreign buyers: A blame game

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GUEST OBSERVATION
The Reserve Bank of Australia’s (RBA) announcement to hold the cash rate for April at 2.25 percentage points could ease the increase in house and unit values over the next month. A market slowdown would allow greater purchasing power for first time home buyers in unaffordable housing markets.
The number of first time homebuyers taking out home loans has declined as a result of the recent housing boom, which saw more investors enter the market. This is supported by ABS data, which shows that home loans taken out by first time homebuyers have steadily decreased from 18.8% in 2012 to 14.9% in 2015.
Furthermore, according to ABS data, the size of the average home loan increased 1.07% between December 2014 and January 2015, to $346,600.
The decision to hold rates is partly attributable to Australia’s two-tiered housing market. According to <a href="https://Onthehouse.com.au" target="_blank">Onthehouse.com.au</a> data, at February 2015, Sydney experienced quarterly growth of 3.55% for houses, and 2.83% in units. These are down from the January quarter of 4.10% for houses and 3.04% in units, although they still reflect strong investor demand.
Despite Sydney’s strong performance, other markets, including Melbourne and Brisbane, saw contraction in property values at the end of the February quarter.
On the supply side of the housing market, February housing approvals were almost at a five-year high. In NSW, approvals for February 2014 totalled 4,692 dwellings, approximately 2,600 of which were units. Dwelling commencements in NSW, as last recorded in September 2014, were at a high of 14,063, which is a 43% increase in commencements from the previous quarter, and is 49% higher than the five-year average of commencements.
Dwelling commencements also increased in QLD and VIC, but at a lower rate. Nationwide, commencements hit a record high of 54,436, despite migration currently sitting below the five-year average. A further cut in the cash rate could have seen funds misallocated in a market where migrant and first homebuyer demand is in decline.
Overall, despite the benefits to first time homebuyers, the rate hold decision does come within a tricky economic climate for the RBA, where economic indicators have remained virtually unchanged for the previous period.
Some notable indicators include:
<ul>
<li>The unemployment rate decreased from 6.4% in January to 6.3% in February. However, this was coupled with a decrease in the participation rate from 64.7% to 64.6%, suggesting that the unemployment rate fell as people came out of the labour force, rather than finding work.</li>
<li>Annual wage price growth was at a five year low in the quarter ending December 2014, at just 2.5%. The December quarter also saw low inflation, which was last recorded at 1.7%.</li>
<li>Iron ore is currently at a 10 year low, at $US46.7 a tonne. Iron ore is expected to fall further as competitors amplify supply to win greater market share.</li>
<li>Oil prices seem to be stabilising following a significant decline since July 2014. Oil rose marginally in the latest trading session to $US53 per barrel. While the price is stabilising at approximately half the five-year average, Australians may no longer enjoy further discounts in the oil price. </li>
</ul>
Though the above factors call for a further cut in the cash rate, the hold is more about timing than tightening monetary policy. This month will reveal new quarterly inflation figures and employment data, which would allow more insight into the impact of February rate cuts. 
Eliza Owen is a market analyst at <a href="https://Onthehouse.com.au" target="_blank">Onthehouse.com.au</a>.
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po-LsXgBTHBmX

The RBA April rate hold will benefit first time home buyers: Eliza Owen

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The national auction clearance rate have hit 79.2 per cent, the second strongest result on record, according to CoreLogic RP Data.
It is the strongest result since September 2009. 
There were 2,541 auctions held across the combined capital cities, in the week ending April 19. 
Last week, the final auction clearance rate was recorded at 77.2 per cent with 1,674 residential properties taken to auction.So far this year, with 12 weeks of auction results having been reported, the combined capitals have seen clearance rates above the 75 per cent mark in eight of these weeks.
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There were 1,252 Melbourne auctions held this week, with a preliminary auction clearance rate of 78.7 per cent. Over the year to date, Melbourne’s clearance rate has been outperforming when compared to the same periods over the past four years, however the number of homes taken to auction so far this year is slightly below last year. The best performing Melbourne sub-region this week was Melbourne’s Outer East where 73 auction results were recorded, with a clearance rate of 93.2 per cent. Auction activity was also solid across the Inner South region (86.8 per cent). 
In what was yet another strong result for Sydney, this week’s preliminary auction clearance was 88.3 per cent, the strongest clearance rate for the city on record. There were 950 auctions held across Sydney this week, up from 671 over the previous week. Since the last week in January this year just shy of 9,890 Sydney homes have been up for auction and the number of transactions is around 8,300. The high success rate shows that vendors and buyers within this market are well aligned, which is also reflected in the short time it is taking to sell a Sydney home by private sale. Much like last week, Sydney’s Eastern Suburbs performed well this week, with 62 auctions held and so far, 95.9 per cent of reported auctions sold. A similar result was obtained across North Sydney and Hornsby (95.0 per cent) and Blacktown (94.7 per cent). 
Brisbane’s preliminary clearance rate this week was 48.3 per cent, down from 54.4 per cent last week, which was the second highest clearance rate for the city this year. There were 139 Brisbane auctions this week, compared to 117 last week. The Gold Coast was host to 103 auctions this week. Based on the results reported to CoreLogic RP Data so far, 65.8 per cent have been sold. 
In Adelaide, the preliminary clearance rate was 70.5 per cent, compared to 68.6 per cent last week. As the year progresses, Adelaide’s clearance rate is becoming increasingly strong. 
There were 37 Perth auctions this week and so far 19 results have been reported, with just 21.1 per cent selling. Last week there was a 57.1 per cent clearance rate for Perth. 
Canberra’s clearance rate was 73.7 per cent this week, compared to 72.7 per cent last week. 
In Tasmania, 6 auctions were reported to CoreLogic RP Data with 2 sales. Last week, 8 auctions were reported with 4 sales. 
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jchancellor-FAypfDUnLy

Strongest national clearance rate since Spring 2009

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There are times in the development process that just seem to drag on and on. One of these irritating drawn out processes is the period after the Development Application (DA) and Construction Certificate (CC) are approved but before construction can commence.
After the approvals are received, our clients are then able to finalise their construction loan. Prior to this they have received a preapproval from their bank. For their construction loan to be unconditionally approved, the bank requires all supporting documentation.  This includes stamped plans, consents, signed builder's contract and insurance along with other personal documentation confirming your income.
Property Bloom is in this process with several of our projects right now and it's like riding a bike from a smooth bitumen road into a sand dune. 
The momentum and excitement that builds as we received the DA consent from council gathers speed by the use of a private certifier to fast track the CC process.  So it's just a week or two before we usually obtain the CC consent from lodgement.  It's then the builder's contract is issued to clients for signing and a copy is given to the bank together with the other required documentation to finalise their construction loan.
Then we hit the sand that bogs us down, slowing momentum. The banks will take their time processing the loan but it's also the application of the Home Builders Compensation Fund (HBCF) policy, formerly known as the Home Warranty insurance that slows the process. HBCF is required to be raised by the builder and covers their client for losses arising from defective and incomplete work where the builder becomes insolvent, dies or disappears.  
In the past we were able to apply for this insurance as soon as the CC consent was issued, however now the insurance company wants a copy of the signed builders contract and this adds another two weeks to the process as we need to wait for clients to review and sign the contract.
Even once the bank has all they need, including the insurance policy, it can take them another two weeks to issue the authority to commence construction to the builder. We cannot commence construction without the bank's go ahead in writing.
Two weeks here and two weeks there can all add up. When you are relying on third parties there is little you can do apart from be a 'squeaky wheel' and keep calling to see how the application is travelling.
One way to accelerate the process is to avoid using a construction loan. This may not be an option for most developers but if you have enough cash or equity available in other properties then you can look at the option of setting up a line of credit and funding the construction from this. Always get accounting advice on this. The big benefit is that you will avoid the headache the paperwork can cause and you won't be waiting around for the construction finance approval. 
Finally, construction may start as soon as you've signed the contract and the HBCF insurance policy is issued. We have found this to save approximately 6-8 weeks off the time frame of a development. It also has benefits on completion and fast tracks the handover process.
Jo Chivers is Chief Executive Officer of property development project managers <a href="https://www.propertybloom.com.au/about">Property Bloom</a>.
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jochivers-wq5Bp59R5a

How to accelerate the pre-construction phase: Jo Chivers

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When the Budget was released this week I kept reading with great interest that the government had failed to address ‘housing affordability’. Truth be known the only thing that the Abbott government actually controls is foreign buyers and taxation such as negative gearing and capital gains tax. With regard to foreign buyers it has been well documented that with regard to this portfolio they have Failed it with a capital ‘F’.
In fairness the Federal government would respond by saying that to the contrary they have already unleashed the Australian Taxation Office (ATO) to forensically investigate all property transactions that they believe have contravened the laws. Well if it wasn’t for some bloggers and journalists who pointed this out to the Abbott government foreign buyers would be still running amok. I believe the findings will leave most property observers gobsmacked because I believe we are talking about thousands and thousands of sales.
It’s interesting to note that last week a Senate committee made 40 something recommendations pertaining to housing affordability which included calls to review negative gearing and the appointment of a federal minister for housing, to name just two. Well I have been vocal on not having a housing minister since the Abbott government came to office. More interesting was that Coalition senators immediately rejected the findings – well no surprises there.
If you look closely at the housing affordability debate it can be quickly summed up that data shows we are not building enough high density developments. I wrote about this recently – Lots of positives from discussing negative policies where the NSW government has recognised the problem stemming from municipal councils who are rejecting developments despite the Sydney population expanding at unprecedented levels. The NSW government wants to merge councils to free up more development to meet Sydney’s population explosion.
Should the NSW government be successful with its charter then the price of apartments will obviously come down as too rents. So I’m somewhat mystified why property investors are driving up apartment prices when such a major announcement is pending.
The Abbott government needs to take a very serious look at the legislation that allows foreign buyers to purchase off the plan. I believe that it would be sage for the Abbott government to place foreign buyers on – hold until the ATO has released its preliminary findings. What we are seeing today is Chinese developers out bidding the local developers simply because the off – the – plan legislation allows them to sell directly overseas to foreign buyers so these properties never even hit the Australian market. A vast number of these properties are land banked so they remain vacant which again is self-defeating and ludicrous that this can happen in this day and age.
This week we also read that there are foreign criminals trying to buy Australian real estate to wash their money by investing in real estate. Well this is nothing new as I have heard a few examples of agents who questioned some foreign buyers who expressed interest in landmark Sydney residences.
Thailand has had serious problems with the Russian mafia who have bought up significant parts of that country where the government announced a few years ago that it was cracking down hard on these transactions. This is a global problem where Australia immediately needs to take decisive action which also means tightening the many legal loopholes.
Take the recent divestment order on Villa del Mare where it was found that the Chinese purchaser did not have Australian residence. When I wrote about this <a href="/expert-insights/treasurer-joe-s-villa-del-nightmare-robert-simeon">Treasurer Joe’s Villa del Nightmare</a> on March 5 I said that the purchaser would find an Australian resident to buy the property. Well <a href="/news/australian-buyer-lola-wang-li-emerges-with-villa-del-mare-the-39-million-point-piper-firb-home">Australian buyer Lola Li emerges with Villa del Mare, the $39 million Point Piper FIRB home.</a>
The good news to come from this debate is that for the first time “the dogs are barking” and the Abbott government has to act – and act fast. Finding a viable solution to foreign buyers will prove a much harder assignment than towing back boats.
With regard to new developments, for starters there should be a selling ratio of foreign buyers to Australian residents established.
The Australian property industry has never before encountered such a debate and much of this stems from record low global cash rates. Investors are chasing returns and Sydney is one of the hottest property markets on the globe.
The Abbott government needs to send a very clear message to foreign buyers which is either buy or bye?
Mosman Market
When you look closely at the actual numbers of properties on the market you will struggle to say that the market is booming or bubbling as some prefer to say. Historically when markets are booming this coincides with record volumes being on the market which is otherwise known as a feeding frenzy. The confusing parts about our local markets are that stock levels are down 50 per cent on this time last year or thereabouts.
MOSMAN – 2088
• Number of houses on the market this time last year – 102
• Number of houses on the market last week – 57
• Number of houses on the market this week – 57
• Number of apartments on the market this time last year – 72
• Number of apartments on the market last week – 50
• Number of apartments on the market this week – 49
CREMORNE – 2090
• Number of houses on the market this time last year – 7
• Number of houses on the market last week – 3
• Number of houses on the market this week – 4
• Number of apartments on the market this time last year – 27
• Number of apartments on the market last week – 13
• Number of apartments on the market this week – 10
NEUTRAL BAY – 2089
• Number of houses on the market this time last year – 7
• Number of houses on the market last week – 3
•Number of houses on the market this week – 3
• Number of apartments on the market this time last year– 48
• Number of apartments on the market last week – 31
• Number of apartments on the market this week – 27
 Source: APM Price Finder
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robertsimeon-hRNTwJyXkQ

Do we tell foreign buyers to buy or bye? Robert Simeon

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<div>Population growth in Australia has slowed from its recent peak of a shade above 405,000 per annum in September 2013 back to around 354,600 per annum on the latest figures.</div>
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<div>This headline number will have some way to fall yet, with the December 2014 figures yet to be reported.</div>
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<div>However, a rebound is in the post in time.</div>
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<div>In the summer month of January 2015, traditionally a strong month for long term arrivals, the <a href="https://www.abs.gov.au/ausstats/abs@.nsf/mf/3401.0/" target="_blank">Australian Bureau of Statistics figures</a> recorded a bounce from 52,160 to 76,310, although the January result is still 9 per cent lower than one year ago.</div>
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<div><img src="/images/2015/06/09/wargent1.jpg" alt="" width="751" height="366"></div>
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<div>On the departures side, however, long term and permanent departures also declined in January from 46,740 to 42,100, which notably is a below figure than the prior year comparative.</div>
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<div>On a rolling annual basis net long term migration of 318,560 sits some 22 per cent below the most recent peak of January 2013.</div>
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<div><img src="/images/2015/06/09/wargent2.jpg" alt="" width="673" height="324"></div>
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<div>When it comes to the long term and permanent departures data, stated intentions when ticking boxes on forms are one thing, but today's reality is quite another.</div>
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<div>Boomerang departures are one of the reasons that our capital cities appear so crowded, despite the apparently slowing population growth data.</div>
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<div>On the one hand we now have record high short term arrivals at close to 7 million per annum.</div>
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<div>And meanwhile most of those who claim to be migrating overseas permanently have "pulled a boomerang" within a year of leaving.</div>
 <div>
<a href="https://www.abs.gov.au/ausstats/abs@.nsf/Latestproducts/3401.0Main%20Features2Jan%202015?opendocument&amp;tabname=Summary&amp;prodno=3401.0&amp;issue=Jan%202015&amp;num=&amp;view=" target="_blank">Analysis</a> of prior years' data from the Australian Bureau of Statistics reveals that while ostensibly more than 380,000 Australians left the country on a long term or "permanent" basis over the past 12 months, more than 80 per cent of them are likely return home within just a year!</div>
 <div>"Analysis shows that the majority of those with an intention of permanently departing, return to Australia within the following year. </div>
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<div>For example, in the calendar year 2011, out of the 84,240 Australian residents who stated they were departing permanently, only 15,890 spent 12 months or more overseas."</div>
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<div>So much for the "long term-ness" of the long term departures, if you'll kindly pardon my dreadful English.</div>
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<div>Perhaps those pastures further afield aren't as greener-er as what people think they are, and that's why they done that.</div>
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<div>OK I'm getting rather grammatically bogged down here, so let's move on to look at...</div>
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<div>Record high visitors (the delayed Oprah effect)</div>
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<div>Shifting seamlessly along to short term arrivals we can see that visitors to Australia have sprinted to their highest level on record at more than 6.9 million.</div>
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<div><img src="/images/2015/06/09/wargent3.jpg" alt="" width="829" height="390"></div>
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<div>
<div>The idea that Kiwis are flocking home to rediscover the beauty of their homeland is an appealing narrative, but also one that has been overplayed.</div>
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<div>In fact, record numbers of New Zealanders arrived in Australia in the past year on a "short term" basis at close to 1.25 million.</div>
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<div>There has also been a notable surge in the number of American visitors to Australia to a record 555,300 on a rolling annual basis.</div>
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<div>Oprah Winfrey said it'd happen, and it seems she was right.</div>
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<div>Although the detailed figures do show a spike relating to her December 2010 visit - from memory she brought along a few hundred whooping guests, and even greater numbers of security guards and filming crew - it is only in the past 12 months that American visitor numbers have really picked up strongly. Naturally the decline of the Aussie dollar towards the mid 70 cent range against the greenback is a big driver here. </div>
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<div><img src="/images/2015/06/09/wargent4.jpg" alt="" width="893" height="434"></div>
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<div>And the below mega-trend, I've documented here often previously.</div>
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<div><img src="/images/2015/06/09/Screen%20Shot%202015-06-09%20at%209.45.00%20AM.png" alt="" width="744" height="341"></div>
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Expect more of the same based upon what I've seen around the traps in 2015. Asian settlers  <div>In terms of settlers in Australia the trend has clearly been away from Brits and Kiwis since the financial crisis and towards Chinese and Indians. 
</div>
<div>However, there was a reasonable rebound in the number of New Zealander settlers in January so this particular downtrend may have run its course for now, although Kiwi settler numbers are still clearly down by 10 per cent or so from a year ago.</div>
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<div>Poms clearly are evidently still opting to stay at home, though.</div>
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<div><img src="/images/2015/06/09/Screen%20Shot%202015-06-09%20at%209.46.16%20AM.png" alt="" width="817" height="411"></div>
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<div>The last 12 months has seen some 71,310 settlers from Asia, another mega-trend that shows no real sign of abating.</div>
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<div><img src="/images/2015/06/09/Screen%20Shot%202015-06-09%20at%209.47.21%20AM.png" alt="" width="828" height="418"></div>
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<div>The wrap</div>
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<div>The rolling long term net migration figures imply that Australian population growth will sink back towards the low 300,000s range over the near term.</div>
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<div>However, a complex range of factors will combine to drive a rebound in due course. </div>
<div> </div>
<div>Not least of these trends is that most who claim to be slinging their hooks for good don't even make it past year one before "pulling a boomerang".</div>
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<div class="post-footer">
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>. His book '<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>' is out now.
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pwargent-M4siyDbqQY

Boomerang departures drive population growth rebound: Pete Wargent

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I received a call from a novice property developer the other day and thought I'd share his dilemma.
He'd purchased a duplex site and had just received a set of plans and had a builder quote on the plans. He couldn't understand why there was so much allowed for in "site works". 
I looked over his quote for him and could see that his builder hadn't itemised out many costs. Our builder's quote or tender has about 75 itemised inclusions.
I explained to the caller that there was probably a lot of items included in his "site costs".  
Site works cover a few different things. Some builder's refer to them a pre-construction works or simply excavation works.
After the site is pegged out by the surveyor, excavation will start. If the site is relatively flat, this may just involve a 'site scrape' which will remove the top layer of grass and bushes. If there are trees on the  site, the excavator can sometimes knock them down or you may need to have these cut down and removed before the excavator comes to site. If so, make sure you leave about a meter or so of the tree stump above the ground the excavator will be able to pull up the root systems. All this vegetation has to be disposed on, so land with a lot of bush and trees is more expensive to prepare as disposal of debris will depend on the dump truck's load size or weight.
If the site is sloping then there will be much more work required to cut the site. There will be excess soil to remove. This is included in "site works". Mostly there is a Provisional Allowance for this work which means you may pay more or less than the allowance, so it's important you have a builder who is experienced and accurate with their allowances. The builder Property Bloom uses is often giving credits for these works as I would rather have them over allow than under allow.
So back to my caller… I advised him to ask his builder to break down the costs for him that were included as "site costs" that way he could more clearly see what was included and understand the process.
This leads me to site selection and comparing development sites.
Last week we took a client with us to inspect two dual occupancy sites that we were told would be coming onto the market shortly. They were in the same suburb but different locations. The suburb profile really stacked up, a high proportion of owner occupiers, good sales references for comparable properties, lots of government and council spending on infrastructure and community services and high rental demand.
The two lots were pretty similar in size, both large enough for a dual occupancy development but there was one major difference. One lot had about a 3m fall from the rear to the front and the other lot had a very slight fall to the rear boundary.
The two lots were the same price. The lot with the 3m fall was in a slightly better location, closer to community facilities in the area and our client said our client liked that land better than the other.
However, after walking over both sites, I explained our choice was the other lot. This was because of the savings on site costs. The slight fall to the rear did not worry me as the sewer and drainage systems were already in place there. The fact that this land would need less cut, less spoil removed and most importantly very little retaining was why I liked it so much.
The land with a 3m fall to the street would require more cut and fill work, perhaps even the use of dropped edge beam slabs and also retaining walls. Unfortunately, these works add no intrinsic value to your development. You won't get any more rent or a better sales price if you have high retaining walls, in fact higher walls can detract from the appearance of the private open spaces.
So choose your site wisely and ensure your builder has a good track record with estimating the allowance required for site works.
Jo Chivers is Chief Executive Officer of property development project managers <a href="https://www.propertybloom.com.au/about" target="_blank">Property Bloom</a>.
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How site costs impact your development: Jo Chivers

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That pesky property bubble is mainly contained to the investors chasing yields and taking advantage of a chronic under-supply which is driving up rents – well it was however, we are now starting to see rents flat lining given supply has significantly increased.
New lending initiatives are quickly changing the investor landscape where I suspect it will be a very long time before we see lenders offering 90 per cent loans as we are now seeing lending ratios sitting more around the 70% mark. <a href="/expert-insights/overseas-buyers-will-support-sydney-house-prices-during-apra-crackdown-nab">Overseas buyers will support Sydney house prices during APRA crackdown: NAB</a>; it is fair to say that the federal government won’t be tweaking the foreign buyer ratios (presently at 100 per cent) anytime soon.
There is a reason for this; Australia’s population is set to hit 40 million people by 2056. In order to meet this demand we will see the greatest infrastructure spending in Australia’s history given it’s been calculated that by 2056 Australia will need a further 1,100,000 apartments. Across Australia that means an additional 27,000 apartments each year for the next 41 years, it is expected Sydney and Melbourne will do the majority of the heavy lifting. This also plainly identifies why the Baird government wants to amalgamate the councils to ensure that these new developments keep getting approved.
The message is quite clear that if you want to reside in close proximity to the CBD you will have to live with an avalanche of high density developments.
This week the residential data from the 34th Property Directions Survey was released which is an industry based group comprising property experts – Valuers, Fund Managers, Property Analysts and Property Financiers.
<ul>
<li>58% of respondents stated that Sydney residential property was in or entering a bubble, while 53%t of the respondents believe that the Melbourne property market is in the same position. Seventy per cent of the survey respondents do not believe that the Brisbane residential market was in a bubble.</li>
<li>The majority of the respondents also believe residential property prices will continue to rise for 6 to 12 months. Fifty – three per cent of respondents believe that Sydney residential property prices will continue to rise for either 6 or 12 months with 26% stating 18 months. Respondents are more certain in their predictions for Melbourne residential property with 76%seeing prices continuing to rise for 6 to 12 months.</li>
<li>In 2016, Sydney residential property is seen as reaching the top of the property cycle and moving past the top in 2017. In 2016 respondents see Melbourne residential property having passed the top of the cycle but remaining close to the top through to 2017. Brisbane residential property is seen to be just nearing the top of the cycle.</li>
<li>All respondents to the Property Directions Survey see low interest rates as either a significant or very significant driver of demand for residential property in Sydney, while 95% also point to foreign investment being significant or very significant.</li>
<li>Respondents list a number of other factors they also believe play a role in increasing demand in Sydney, such as population growth, low supply over the past decade and the trend towards smaller households.</li>
<li>The major drivers are considered to be similar for the Melbourne residential property market however 94% see foreign investment as a significant or very significant driver and 87% sight low interest rates as significant to very significant.</li>
<li>A large majority of respondents see low interest rates as the main driver of demand and prices for Brisbane and Perth residential property; however this view is not as strong as it is for Sydney and Melbourne. The majority of survey respondents do not view foreign investment as a significant or very significant factor in driving demand in Brisbane or Perth, but believe negative gearing plays a bigger role.</li>
<li>Most respondents believe both interest rates and inflation will remain similar for next year, while moving higher in the next three years.</li>
<li>It’s a different story with foreign investment, with a small majority of respondents believing levels will remain similar for the next six months. Respondents are less certain over the next 12 months, but most see foreign investment at similar or higher levels. Respondents are even more uncertain about the outlook for 2018,</li>
<li>Some respondents listed current or emerging factors which they believe may have an impact on the Australian property market. Factors listed include a slowing Chinese economy, any increase in the unemployment rate and potential changes to foreign investment or immigration rules.</li>
</ul>
So the eastern seaboard is where we will see the majority of the new developments with NSW leading the way. This again will be investor led although it would be reasonable to suggest that with such a huge apartment platform the house prices will continue to rise with less single residential housing being built.
With that in mind it’s scary to think where prices will go for houses within a 15 kilometre radius of the Sydney CBD. Through the roof springs to mind.
As for that pesky property bubble – it won’t be doing any damage when the vast majority of suburbs across Sydney are posting record low stock levels. When markets are booming (or bubbling along) you see record stock levels which is the complete opposite to what we are seeing across Sydney at the present.
<h4>MOSMAN – 2088</h4>
• Number of houses on the market this time last year – 85
• Number of houses on the market last week – 55
• Number of houses on the market this week – 46
• Number of apartments on the market this time last year – 63
• Number of apartments on the market last week – 41
• Number of apartments on the market this week – 43
<h4>CREMORNE – 2090</h4>
• Number of houses on the market this time last year – 8
• Number of houses on the market last week – 7
• Number of houses on the market this week – 2
• Number of apartments on the market this time last year – 9
• Number of apartments on the market last week – 11
• Number of apartments on the market this week – 8
<h4>NEUTRAL BAY – 2089</h4>
• Number of houses on the market this time last year – 9
• Number of houses on the market last week – 3
• Number of houses on the market this week – 2
• Number of apartments on the market this time last year– 42
• Number of apartments on the market last week – 29
• Number of apartments on the market this week – 30
 
ROBERT SIMEON is a director of <a href="https://www.rwm.com.au/" target="_blank" title="RWM" rel="nofollow">Richardson Wrench Mosman and Neutral Bay</a> and has been selling residential real estate in Sydney since 1985.  He has also been writing real estate blog <a href="https://www.rwm.com.au/news/" target="_blank" title="Virtual Realty News" rel="nofollow">Virtual Realty News</a> since 2000. 
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Living with an avalanche of high density development: Robert Simeon

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The Australian property markets find themselves in an unprecedented quandary with record low cash rates that have driven investment property prices in Sydney and Melbourne to record levels. The problem as I see it is that it is highly unlikely that such dizzy heights can be maintained, so that said one can assume that prices should start plateauing. 
The problem with that scenario is that given the present market conditions this is highly unlikely as property investors are only interested in Sydney and Melbourne real estate.
The owner occupier property market is much slower with stock levels at all-time lows which can be attributed to the fact that businesses are no longer paying cash bonuses preferring to reward staff with shares. What this has done is take billions of dollars from the owner occupier property markets which explains in principle why the owner occupier markets are so slow.
Nobody can really explain why property investors are only interested in Melbourne and Sydney especially when Australia is experiencing an unprecedented population explosion. This becomes even more confusing when we hear that Australia’s east coast is the destination expected to feel the full brunt of this population explosion.
This year I have been in dialogue with Richardson &amp; Wrench Projects where I have attended some information seminars to learn more about this fascinating investor market. The problem with real estate agents is that our knowledge is always contained within a particular postcode, hence a reluctance to look outside our comfort zone which is the very same mindset as property investors.
So the first question I wanted to know was where are the next best areas to invest outside Sydney and Melbourne, that are more much affordable with strong capital growth, excellent rental returns and with strong depreciation allowances. My question was answered immediately with two areas – Newcastle and Brisbane – well, that makes sense as they are both on the east coast with strong population forecasts.
With that in mind it was off to Brisbane to have a look around and see just why Brisbane is considered the next area to chase property investor returns. The first thing you notice is their road infrastructure is superior to Sydney’s with nowhere near the traffic congestion. Just like what we are now seeing with NSW where government is now on a record infrastructure spend, although in NSW we keep adding a new lane to infrastructure that was only constructed ten years ago. The government has allocated a further 120 billion dollars for infrastructure over the next three decades.
A new international airport and the big star attraction is the new Las Vegas style $4.000 billion casino – in many instances the South Bank area (which is the area I liked the most) reminded me of what’s happening at Barangaroo on Sydney Harbor. Although at a fraction of the price.
One of the most interesting points that really resonated with me was that the Richardson &amp; Wrench Projects team told me that they actually reject 90 per cent of projects that fail their strict criteria – which was evidenced in their project investment reports which are about sixty pages of research data. Investors in Sydney and Melbourne usually get a one or two page report if they are lucky which always have the usual disclaimers.
So what happens to the ninety per cent of developments that were rejected was my next question? Well, they lure those unsuspecting property investors and stitch them up which explains why property investors stick to the areas that sit well within their comfort zones – even though they know they are paying top dollar.
Australians love investing in property which explains why so much is written about bubbles, crashes and fear factor frenzies. So if you are contemplating stepping out of your comfort zone and looking for an investment area to watch closely we would recommend Brisbane – it’s a very interesting exercise especially for those who insist that you only invest in Sydney and Melbourne. I am the first to admit that this week’s visit to Brisbane has completely changed my property investment train of thought.
It’s important to note that Australia is changing (so must our perceptions) with the latest Bureau of Statistics projections now have Melbourne as Australia’s biggest growing city. Melbourne is tracking to become the country’s biggest city in 2056 and has also overtaken Western Australia to now be Australia’s fastest growing state.
MOSMAN – 2088
• Number of houses on the market this time last year – 74
• Number of houses on the market last week – 46
• Number of houses on the market this week – 43
• Number of apartments on the market this time last year – 57
• Number of apartments on the market last week – 43
• Number of apartments on the market this week – 39
CREMORNE – 2090
Number of houses on the market this time last year – 11
• Number of houses on the market last week – 6
• Number of houses on the market this week – 4
• Number of apartments on the market this time last year –11
• Number of apartments on the market last week – 8
• Number of apartments on the market this week – 12
NEUTRAL BAY – 2089
* Number of houses on the market this time last year – 3
• Number of houses on the market last week – 2
•Number of houses on the market this week – 2
• Number of apartments on the market this time last year– 42
• Number of apartments on the market last week – 30
• Number of apartments on the market this week – 39
ROBERT SIMEON is a director of <a href="https://www.rwm.com.au/" target="_blank" title="RWM" rel="nofollow">Richardson Wrench Mosman and Neutral Bay</a> and has been selling residential real estate in Sydney since 1985.  He has also been writing real estate blog <a href="https://www.rwm.com.au/news/" target="_blank" title="Virtual Realty News" rel="nofollow">Virtual Realty News</a> since 2000.
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