ANZ believes the Reserve Bank is in no rush to move again.

Following the release of the May Monetary Policy Board Minutes, ANZ has taken the view that the RBA is now firmly in a holding pattern, with the cumulative impact of previous rate hikes giving the Board scope to assess how the economy evolves from here.

That positioning, in ANZ’s view, makes a June rate hike unlikely.

The bank continues to expect the cash rate to remain unchanged at 4.35 per cent for an extended period, with the RBA adopting what is effectively a wait-and-see approach.

The Minutes point to a Board that sees financial conditions as already restrictive, but without a clear read on just how restrictive they are. That uncertainty has shifted the focus away from immediate policy action and toward monitoring both domestic conditions and global developments, particularly the conflict in the Middle East.

As ANZ interprets it, the Board is deliberately avoiding strong forward guidance.

Instead, it is allowing itself flexibility, acknowledging that monetary policy has limited ability to influence the near-term trajectory of inflation, while also recognising that economic growth is likely to remain below potential for some time.

Despite that pause in momentum, ANZ notes that the Board still carries a tightening bias.

The Minutes reveal that, in weighing up its decision, the Board seriously considered another 25 basis point increase. The key debate centred on the trade-off between inflation and activity, particularly in the context of global uncertainty.

Ultimately, most members leaned toward the inflation side of that equation.

Underlying inflation is still expected to remain above target for an extended period, regardless of how external risks evolve. That has led to a view within the Board that the risks to its inflation objective have increased, and that the current cash rate may not be sufficiently restrictive to fully contain those pressures.

That’s important.

While the decision, for now, is to hold, the underlying tone of the Minutes suggests the door to further tightening has not been closed.

ANZ also points to commentary from Assistant Governor (Economic) Sarah Hunter, who highlighted the risk that inflation could pass through the economy more quickly and broadly than in previous cycles. Both Hunter and a majority of the Board expressed concern that inflation expectations could become less anchored after such a prolonged period above target.

That combination, persistent inflation and the risk of expectations shifting, is what continues to underpin the RBA’s cautious stance.

However, where ANZ diverges from the RBA is on the outlook for activity.

The Board appears relatively comfortable with current spending patterns, effectively downplaying recent declines in business and consumer sentiment. It notes that sentiment has historically been only weakly correlated with actual spending, and that feedback from its liaison program has not yet pointed to a meaningful slowdown in consumption.

ANZ is less convinced.

The bank believes the link between household disposable income, sentiment and spending is more direct than the RBA is currently acknowledging. With inflation continuing to erode real incomes, ANZ expects household spending to soften more materially than the central bank is forecasting.

That divergence matters because it shifts the balance of risk.

If activity weakens more than expected, the trade-off between inflation and growth changes. In ANZ’s view, that would reduce the need for further tightening and reinforce the case for the RBA to remain on hold.

It also suggests that the current policy setting may already be doing more work than the Board fully appreciates.

The broader takeaway from ANZ’s interpretation is that the RBA is walking a narrow path.

On one side sits the risk of inflation remaining elevated for longer than expected. On the other is the growing pressure on households and the potential for a sharper slowdown in activity.

For now, the Board is choosing to wait.

But it is a pause that still carries an underlying tightening bias, rather than a clear pivot toward easing.

In practical terms, that leaves the cash rate anchored at 4.35 per cent for the foreseeable future, with the next move still uncertain.

For borrowers, it reinforces the reality that relief is not imminent.

And for the broader economy, it highlights the delicate balance the RBA is trying to strike, between bringing inflation back to target and avoiding an unnecessarily sharp slowdown in growth.

According to ANZ, it is a balance that is becoming increasingly difficult to maintain.

Joel Robinson

RBA to hold rates for "prolonged period" rather than hikes: ANZ

<a href="https://www.apartments.com.au/developers/venturecrowd-property-projects">VentureCrowd</a> is down to the final Canopy Villa release at Cumulus Grand Villas in Carrara, as construction continues on the 59-residence gated community positioned above 100 hectares of natural savanna on the Gold Coast.

The remaining Canopy Villa forms part of one of four collections within the <a href="https://www.apartments.com.au/architects/bda-architecture">BDA Architecture</a>-designed community and has attracted interest from buyers seeking larger-format homes that combine privacy, security and low-maintenance living. Positioned within a private cul-de-sac and facing a protected black she oak forest, the four-bedroom villa includes a large private outdoor area suited to pet owners and families wanting more flexible space.

<a href="https://www.apartments.com.au/new-townhouses/cumulus-grand-villas-carrara-17-baltimore-court-carrara-qld-4211">Cumulus Grand Villas</a>, located at 17 Baltimore Court, comprises a mix of three and four-bedroom villas across the Skyline, Canopy, Savanna and Broadview collections. Prices currently range from $1.455 million to $1.895 million, with the final Canopy Villa priced from $1.825 million.

[smartcode_project:default project_id=135663 project_image_fid=360477]

The Canopy Collection villas offer four bedrooms, 2.5 bathrooms and approximately 245 sqm of internal space, alongside double garages and landscaped private areas. Expansive glazing, open-plan living spaces and private balconies have been designed to maximise natural light and outlooks toward the surrounding savanna landscape.

Construction is now underway across the fully funded development, which VentureCrowd says has become an increasingly important consideration for buyers assessing off-the-plan opportunities on the Gold Coast. The project is being delivered by <a href="https://www.apartments.com.au/builders/devcon">Devcon Property Group</a>, which has operated in South East Queensland since 1993 and delivered more than 1,000 homes across the region.

VentureCrowd Director of Property David Whitting previously said the project responds to changing buyer priorities in the prestige Gold Coast market.

“Flexible floorplans have proven particularly relevant for purchasers aged between 40 and 65, including next home buyers, downsizers and investors,” Whitting said.

[smartcode_project:default project_id=135663 project_image_fid=360505]

The buyer profile at Cumulus has reflected that shift toward owner-occupier-driven demand. Stuart Towns and Tracey Loynes recently purchased a Canopy Villa, drawn to both the lifestyle offering and the flexibility the home provided for their next stage of living together.

The couple, who met three years ago, sold their Robina home earlier this year after identifying what they saw as strong long-term investment potential at Cumulus while remaining within the same Gold Coast market. The villa’s private backyard was a major drawcard for their dog Luna, while proximity to golf courses including Emerald Lakes also aligned with their lifestyle interests.

Beyond the residences themselves, the community has been planned around shared lifestyle and recreation amenities. The Infinity Terrace will include a 20-metre heated pool, barbecue facilities, alfresco dining spaces and elevated retreat areas overlooking the surrounding landscape. Walking trails, a private nature reserve, orchard and herb garden are also integrated into the masterplan.

[smartcode_project:default project_id=135663 project_image_fid=360473]

BDA Architecture Director Darren Greenaway said the design approach was heavily influenced by the site’s outlook and secluded setting.

The practice sought to create what Greenaway described as a “little piece of paradise,” drawing inspiration from the elevated views, surrounding greenery and quiet location.

<a href="https://www.apartments.com.au/developments/carrara-qld-4211">Carrara</a> continues to attract buyers seeking larger homes within proximity to the coast but without direct beachfront pricing. Cumulus sits within easy reach of Broadbeach, Pacific Fair, Robina Town Centre and the M1, providing connections north to Brisbane and south toward the Gold Coast Airport and northern New South Wales.

The first stage of Cumulus Grand Villas is targeting completion in 2026.

[smartcode_project_cta:default project_id=135663]

VentureCrowd nears sell-out of Canopy Collection at Cumulus Grand Villas in Carrara

Waverley Council has made a call that many councils have been reluctant to make publicly. Growth is coming, regardless of who controls it.

The release of the Bondi Junction Vision and Master Plan is less about whether the Eastern Suburbs’ primary centre will change, and more about how that change is shaped, funded, and ultimately experienced on the ground. Waverley Council has released a 100-page plan which is effectively the first comprehensive blueprint for Bondi Junction in over two decades, and in doing so, signals a clear shift in how councils are positioning themselves in the current planning environment.

For the past 18 months, the conversation across New South Wales has been dominated by the State Government’s Low and Mid-Rise Housing reforms and the emergence of the Housing Delivery Authority pathway. Both have created faster, more centralised avenues for development approvals, particularly in well-located, infrastructure-rich areas like Bondi Junction.

Waverley Council’s response has been to move early, and decisively.

Rather than react to individual proposals as they come through the HDA or broader State-led reforms, Council has sought to establish a clear, place-based framework that sets the terms for how Bondi Junction evolves. The underlying position is relatively straightforward: if densification is inevitable, it should be tied to infrastructure, public domain improvements, and a cohesive vision for the centre, not delivered piecemeal through ad hoc applications.

<img alt="bondi junction" data-entity-type="file" data-entity-uuid="7f1f729c-ed99-4c6c-bf87-ffbce6991941" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-19%20at%209.58.16%E2%80%AFAM.png?VersionId=ULX4OlXKjeJ5BvNCNGL86evgXCjCfMih" />

At its core, the document is attempting to reposition Bondi Junction from what it largely functions as today, a transport interchange anchored by a major retail centre, into something far more layered. The ambition is to transform it into what the plan describes as the “civic and cultural heart of Sydney’s East,” a place that is active beyond commuting hours and capable of supporting a broader mix of uses, experiences and communities.

That repositioning is built around four key ambitions.

The first is to create a true destination. Bondi Junction already attracts significant foot traffic, with more than 86,000 daily transport users and millions of annual retail visits, but much of that activity is transient. People pass through, rather than stay.

The Master Plan seeks to change that dynamic. It leans heavily into the idea of an “18-hour economy,” extending activity well beyond traditional retail hours through dining, cultural programming, events, and a more active night-time offering. This is not just about adding more hospitality venues, but about fundamentally shifting how the centre operates, from a daytime shopping destination to a place that functions across the full span of the day and into the evening.

Oxford Street Mall sits at the centre of that shift.

Long seen as underperforming relative to its potential, the Mall is identified as one of the key catalyst projects in the plan. It is to be reimagined as a day-to-night spine, combining retail, dining, wellness and cultural uses in a way that creates a continuous flow of activity. Outdoor dining, rooftop venues, laneway activation and a curated events program are all part of the strategy, alongside significant public domain upgrades that aim to improve comfort, safety and usability.

&nbsp;

The second ambition is to transform Bondi Junction into a world-class interchange.

Despite being one of the most heavily used transport nodes in Sydney, the current experience is fragmented. Connections between the station, Westfield, Oxford Street Mall and surrounding streets are often unclear, and major roads create physical barriers that disrupt pedestrian movement.

The Master Plan proposes a more seamless, people-focused network. That includes clearer pedestrian links, improved wayfinding, better integration between transport modes, and a rethinking of how arrival into the centre is experienced. The aim is to shift the perception of Bondi Junction from a place people move through, to a place they arrive in.

The third ambition focuses on greening and open space.

One of the more consistent pieces of community feedback throughout the Vision phase was the need for more greenery, better public spaces, and a more comfortable urban environment. Despite being surrounded by major parks, Bondi Junction itself has relatively limited accessible open space, with much of the public realm dominated by hard surfaces and traffic infrastructure.

The plan responds with a network of new and upgraded public spaces, increased tree canopy, and what it terms the “Parkline,” a green link connecting Waverley Park through to Centennial Park. This is not just about aesthetics. It is about addressing heat, improving liveability, and ensuring that increased density is matched by access to high-quality outdoor space.

The fourth ambition is perhaps the most important from a development perspective: growth that gives back.

Bondi Junction is already the primary location for new housing supply in the Waverley LGA, and that is expected to continue. The area carries a target of 2,400 new dwellings by 2029, with further growth projected beyond that as demand for well-located housing continues to rise. The Master Plan does not seek to limit that growth. Instead, it attempts to shape it.

New housing is to be concentrated around transport, with stepped building heights designed to protect the character of surrounding neighbourhoods. At the same time, the plan introduces a more explicit link between development uplift and public benefit. This is where value capture becomes central.

The document outlines a framework where increased development potential is tied to contributions that fund public domain improvements, community infrastructure, open space, and affordable housing. It is an approach that recognises that much of the transformation of Bondi Junction will be delivered by the private sector, but seeks to ensure that the benefits of that growth are shared more broadly. The Civic Precinct is a key part of that equation.

Leveraging Council-owned land, the plan proposes a consolidated civic and cultural hub centred around Ebley Street. This would include new community facilities, cultural spaces, and potentially a new Council Chambers, creating a focal point for civic life that currently does not exist in Bondi Junction at scale.

It is one of several catalyst projects identified in the Master Plan, alongside the Oxford Street Mall transformation. These projects are intended to anchor change, acting as early interventions that unlock broader investment across the precinct.

Importantly, the Master Plan is not just a design document. It includes a delivery framework that sets out how these ambitions are intended to be realised.

Council is explicit in acknowledging that it cannot deliver the transformation alone. Implementation will require coordination between State agencies, private developers, landowners and the community, with a mix of planning agreements, infrastructure contributions and direct delivery mechanisms used to fund and stage improvements over time.

The plan outlines a mix of short-term, medium-term and long-term actions, from immediate public domain upgrades and planning controls, through to larger-scale projects that will unfold over the next decade or more. In practical terms, the next 12 to 24 months will be the most important.

This is when the Master Plan will move through exhibition, refinement and eventual adoption. It is also the period in which Council will seek to embed the framework into its planning controls, giving it weight in the assessment of future development applications.

Council officers have indicated that once the Master Plan is in place, it could be used as a benchmark when assessing Housing Delivery Authority proposals, and potentially reduce the need for further HDA declarations within Bondi Junction. In effect, it is an attempt to bring planning control back to the local level, while still aligning with State housing targets.

That tension between State-led reform and local planning control is not unique to Waverley. It is playing out across Sydney.

&nbsp;

&nbsp;

&nbsp;

If delivered as intended, Bondi Junction will become denser, more active, and more complex. It will support more residents, more workers, and a wider range of uses, extending beyond its current retail core into a more layered urban environment.

“The civic and cultural heart of Sydney’s East”: Bondi Junction masterplan revealed

Toorak's dress circle St Georges Road, home to some of the city's priciest homes, is set for a rare new apartment development.

Blood Diamond Group, an entity tied to Tina Brandi, wife of David Brandi who has been a prolific bidder on The Block over the years, has filed plans for an ultra-exclusive development across an amalgamated 3,662 sqm site at <a href="https://www.apartments.com.au/new-apartments/104-106-st-georges-road-toorak-vic-3142">104 and 106 St Georges Road</a>.

The proposal would replace two existing homes on the riverfront site with a five-level apartment building cascading down the steeply sloping land toward the Yarra River. Designed by Charles Wright Architects, the development has been carefully shaped around the site’s topography and river environs, with the upper levels stepping back to reduce visual bulk from both St Georges Road and the Yarra corridor.

Planning documents describe the proposal as “a site layout and building typology that is consistent with the emerging character of the area and which provides exceptional amenity for future residents without compromising that of neighbouring properties.”&nbsp;

<img alt="First look: Blood Diamond Group unveils riverfront apartment plans for Toorak Pavilion" data-entity-type="file" data-entity-uuid="ea19a17e-7528-4fa8-b727-05f2f7c025e5" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Toorak%20pavilion%20a_0.png?VersionId=rZ2IjdoUL_UrRl1sZ4wZHnQXbYUaEmUQ" />

The scheme comprises 12 apartments, including 10 three-bedroom residences, one one-bedroom apartment, and a substantial split-level five-bedroom penthouse. A 624 sqm communal rooftop terrace will crown the building, while three undercroft levels embedded into the hillside will accommodate apartments and basement parking.

The design leverages the site’s dramatic northern outlook across the Yarra River, with living areas and balconies oriented toward the water. A central atrium running the full height of the building is intended to draw natural light deep into the residences and improve internal amenity.

Landscape architecture by <a href="https://www.apartments.com.au/landscape-architect/jack-merlo">Jack Merlo Design &amp; Landscape</a> will play a major role in softening the built form, particularly along the river edge where significant setbacks have been introduced. The proposal includes a minimum 30-metre setback from the Yarra River boundary, preserving a substantial landscaped buffer between the development and the waterway.

While a mature English Oak near the front of the site is proposed for removal, the plans retain a large English Elm closer to the riverfront, alongside other established vegetation in the lower section of the property.

<img alt="First look: Blood Diamond Group unveils riverfront apartment plans for Toorak Pavilion" data-entity-type="file" data-entity-uuid="ed3bf19b-5bc7-482f-bde7-41f709a13c3a" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Toorak%20pavilion%20b.png?VersionId=SG_kBGu4rOaSPY8FtVcmPJfSCrstuOfg" />

Architecturally, the building adopts strong horizontal forms with expansive glazing and curved balcony edges facing the river. Planning documents note the upper levels “adopt a receding form” to ensure the building responds appropriately to the Yarra River environs overlay controls.&nbsp;

The surrounding streetscape is characterised by large contemporary homes embedded into the hillside, many presenting as modest one or two-storey forms to the street before expanding toward the river frontage below. The planning report notes this established pattern heavily influenced the massing strategy for Toorak Pavilion.&nbsp;

Until the recent sale of the landmark Clendon Road mansion Coonac for around $130 million, St Georges Road held the state's most expensive home, the $80,000,088 derelict "Ghost House" mansion that was bought by crypto king Ed Craven.&nbsp;

Blair House, also on St Georges Road, sold for $74.5 million in 2022.

First look: Toorak Pavilions slated for dress circle St Georges Road

Six months after a development site on Kangaroo Point’s Shafston Avenue sold for $6.55 million, plans have been lodged for a 23-storey apartment tower.

A company named JMT Mega Capital, understood to be interstate investors when the 1,222 sqm double block traded late last year through Patona Property, is proposing an 84-apartment development in place of the existing low-rise buildings.

The slender tower at <a href="https://www.apartments.com.au/new-apartments/212-220-shafston-avenue-east-brisbane-qld-4169">212–220 Shafston Avenue</a>, overlooking the Brisbane River, has been designed by <a href="https://www.apartments.com.au/architects/aplus-design-group">Aplus Design Group</a>. It will comprise a mix of one-, two- and three-bedroom apartments above six basement levels, topped by rooftop resident amenities.

<img alt="First look: 23-storey Kangaroo Point tower planned for Shafston Avenue riverfront precinct" data-entity-type="file" data-entity-uuid="7e17ba9e-553e-42ef-92b6-22081671521a" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/podium_3.png?VersionId=hlVUf99vrOjUs.vhQs0qV0DhOncUy9T8" />

The development has been designed as a vertically articulated tower with recessed balconies, curved façades and planted edges intended to soften its scale within the evolving Shafston Avenue skyline. In the submitted Urban Design Report, Aplus Design Group said the tower had been “shaped with a slender vertical expression, articulated façades, recessed balcony zones, integrated planting and a clearly defined podium relationship, helping to reduce perceived bulk and create a more elegant contribution to the Shafston Avenue streetscape and broader Kangaroo Point skyline.”

The scheme comprises 84 apartments, including 25 one-bedroom units, 34 two-bedroom apartments and 25 three-bedroom residences. A total of 104 car spaces are proposed across six basement levels, including resident, visitor and accessible parking.

Residents will have access to rooftop communal open space and shared amenities, while the development also incorporates deep planting zones and subtropical landscaping throughout the podium and tower levels. The project includes 35 per cent communal space coverage across the site and a 17.5 per cent deep soil zone allocation to support urban greening outcomes.

The application exceeds the mapped building height under the Kangaroo Point Peninsula Neighbourhood Plan and is being assessed under Brisbane City Council’s impact assessment pathway. The design team argues the additional height is supported by the site’s strategic inner-city location, existing high-density zoning, and proximity to transport and employment hubs.

“The design has been developed to make better use of a well-serviced urban site within an established high-density residential setting, while improving the street presentation and overall quality of the public realm interface,” the report states.

<img alt="First look: 23-storey Kangaroo Point tower planned for Shafston Avenue riverfront precinct" data-entity-type="file" data-entity-uuid="1ab44b1e-ff45-4bf3-8da8-8aa0cd79db33" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/site_10.png?VersionId=tSxeGekZOqj1e9g3PEn_yFoC3taKDp3U" />

The proposal adds to a growing pipeline of apartment developments reshaping Kangaroo Point ahead of the 2032 Brisbane Olympic Games, with demand continuing to strengthen for new housing supply in well-connected inner-city precincts.

Mosaic has nearly sold out its under-construction <a href="https://www.apartments.com.au/new-apartments/the-bedford-by-mosaic-16-30-prospect-street-kangaroo-point-qld-4169">The Bedford by Mosaic</a>&nbsp;and <a href="https://www.apartments.com.au/new-apartments/the-carter-by-mosaic-77-linton-street-kangaroo-point-qld-4169">The Carter</a>,&nbsp;while Pikos recently completed <a href="https://www.apartments.com.au/buildings/skye-residences-by-pikos-kangaroo-point-8-river-terrace-kangaroo-point-qld-4169">Skye Residences</a> nearby. Pikos is also delivering <a href="https://www.apartments.com.au/new-apartments/gaia-kangaroo-point-108-lambert-street-kangaroo-point-qld-4169">Gaia</a>, over 230 three- and four-bedroom apartments on Lambert Street.

First look: 23-storey Kangaroo Point apartment tower planned for Shafston Avenue riverfront precinct

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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Sentiment in the Australian commercial property market hit a new high in Q4, but the headline index continues to mask big differences across property sectors and states, according to NAB’s quarterly tracker on the state of the sector.
The NAB Commercial Property Index rose to +17 points in Q4 from +10 in Q3, a new high since it first came out in 2010.
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By sector, CBD hotels and office markets are leading the way. NSW and Victoria are also out-performing, but WA is lagging considerably, it showed.
Property professionals noted a deterioration in their funding conditions on both debt and equity fronts in Q4, with tighter credit conditions also reflected in higher pre-commitment hurdles for new developments. 
The improvement in the overall index was led by CBD hotels, followed by office and retail. Sentiment in industrial property markets fell and is now weakest overall. 
Looking ahead, property professionals operating in CBD hotel markets are most confident, which may reflect a shortage of supply and the broader pick up in tourism on the back of the lower AUD, along with a pick-up in business travel. 
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Confidence is lowest (albeit positive) among retail property operators, perhaps reflecting expectations that the impetus to household consumption from the housing market will wane through 2016 as house price growth slows. 
The headline Commercial Property Index also continues to hide some very big differences in performance by state. 
“NSW and Victoria remain at the forefront of the improvement in market sentiment, with WA still wallowing in deeply negative territory,” said NAB Group chief economist Alan Oster. 
NSW would remain the most optimistic state for commercial property in the next two years, with Queensland tipped to be the big improver and WA the most pessimistic. 
Survey respondents believe that CBD hotels will provide the best capital returns in the next 1-2 years (4% in each year), followed by office (1% &amp; 1.2%), with significantly higher returns in NSW and Victoria masking further big corrections in WA. Capital returns are expected to be lowest for retail property (0.4% &amp; 0.6%). 
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In leasing markets, office property is expected to provide the best returns over the next 1-2 years (0.7% &amp; 1.7%), with rental growth in NSW and Victoria leading the way. In contrast, office rents in WA are expected to continue falling heavily amid elevated and climbing vacancy rates, significant over-supply and weak tenant demand. 
In the national industrial market, the outlook for rents has been pared back a little (0.2% &amp; 0.4%) with rental returns for retail property also softer (0.2% &amp; 0.5%). 
Despite an overall improvement in commercial property market sentiment, the survey reveals that fewer developers are planning to start new works in the short term. 
“Funding issues may be playing a role here, with more developers indicating that their debt and equity funding situations had deteriorated,” said Oster. 
Tighter credit conditions are also being reflected in higher pre-commitment hurdles for new developments - up for the third consecutive quarter to 53.5% in Q4 and expected to tighten further over the next 6-12 months. 
Around 250 panel respondents participated in the Q4 2015 survey, consisting of real estate agents/managers, property developers, asset/fund managers and owners/investors. 
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prateek24-ezbwHMbNAk

Sentiment at record high in NAB Q4 commercial property survey  

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The Australian Prudential Regulation Authority (APRA) released its December 2015 quarterly data on property exposures by Australian authorised deposit-taking institutions (ADIs).
The data is always interesting to analyse in order to get further insight into the current state of the mortgage market.
The first data point is residential term loans to households which have a total outstanding balance of $1.384 trillion which has increase by 8.9% over the past year. The total value of outstanding owner occupier loans is $884 billion having increased by 12.8% over the past year and accounting for 63.9% of all outstanding loans. The remaining 36.1% of outstanding loans are to investors, having increased by 2.6% year-on-year to $500 billion. 
Growth in outstanding loans has tilted away from investors to owner occupiers.  After year-on-year growth in investor loans peaked at 18.2% in March 2015 it has slowed to 2.6% growth while owner occupier credit troughed at an annual rate of 2.2% in March 2015, before rebounding to the current annual rate of 12.8% (the fastest annual growth rate since June 2010).
<a href="/images/2016/03/Chart-1-3-580x204.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/03/Chart-1-3-580x204.jpg" alt="">
In terms of the types of loans outstanding, 42.3% have an offset facility, 39.3% are interest-only, 0.2% are reverse mortgages, 2.0% are low documentation loans and 0.1% are other non-standard loans.  The year-on-year change across these loan types has been recorded at: +22.0% for loans with an offset facility, +11.6% for interest-only loans, +1.6% for reverse mortgages, -16.6% for low documentation loans and -5.7% for other non-standard loans.  Importantly, the value of outstanding residential loans for low-documentation loans is now at a record low.
<a href="/images/2016/03/Chart-2-3-580x207.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/03/Chart-2-3-580x207.jpg" alt="">
The data highlights that the average outstanding balance on a residential loan is $248,800, up by 1.0% over the quarter and by 4.4% year-on-year.  Reverse mortgages ($95,700), low-documentation loans ($192,800) and other non-standard loans ($195,900) all have much lower outstanding balances.  Meanwhile, loans with offset facilities ($303,700) and interest-only loans ($330,000) have significantly higher outstanding balances. 
The year-on-year changes to the outstanding loan balances have been recorded as follows: +7.2% for loans with an offset facility (fastest year-on-year growth since June 2011), +4.9% for interest-only loans, +2.8% for reverse mortgages (slowest year-on-year growth on record), -1.5% for low-documentation loans and -6.8% for other non-standard loans.  The data shows a slowing in the growth of outstanding loan values for reverse mortgages while riskier lending types (low-documentation and other non-standard) have seen an ongoing fall in outstanding loan amounts.
While the previous data looked at the total value of residential mortgages outstanding, the following data focuses on new residential mortgages over the final quarter of 2015.
Over the December 2015 quarter there was a record-high $98.130 billion worth of new residential mortgages approved, $69.091 billion worth were owner occupied with the remaining $29.040 billion being for investment purposes.  Year-on-year the value of new owner occupier loans is 28.8% higher, its greatest change on record, while investor mortgage lending is -24.9% lower, its largest fall on record.
<a href="/images/2016/03/Chart-3-3-580x212.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/03/Chart-3-3-580x212.jpg" alt="">
Looking at the types of mortgages approved over the quarter: a record low 0.3% were low-documentation, 37.0% were interest only which was its lowest proportion since March 2013, 0.1% were other non-standard loans, 47.4% were originated by third parties and 3.7% were loans approved outside of serviceability.
Focussing on the year-on-year change; low documentation loan approvals are -41.8% lower (their largest year-on-year fall since March 2013), interest-only loan approvals are -11.0% lower (their largest year-on-year fall since March 2009), other non-standard loan approvals are up 28.2% (their largest year-on-year increase since December 2013), third party originated loans are up 6.2% and loans approved outside of serviceability are up 41.3%.  The data indicates there has been a significant pull-back in low-documentation loans and interest-only loans. 
At the same time, non-standard and loans approved outside of serviceability are rising significantly which may be a potential point of concern for APRA.  Although they make-up a small overall proportion of lending it will be something to keep a close watch on over the coming quarters especially since both have also recorded a quarterly increase.
<a href="/images/2016/03/Chart-4-3-580x207.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/03/Chart-4-3-580x207.jpg" alt="">
Finally the data breaks out new lending by loan-to-value-ratio (LVR) bands.  Over the quarter, 23.4% of all new loans had an LVR of less than 60%, 53.4% had an LVR of between 60% and 80%, 14.5% had an LVR of 80% to 90% and 8.7% had an LVR of more than 90% which was its lowest proportion on record. 
Looking at the year-on-year changes, the value of lending for LVRs of less than 60% was 16.1% higher, LVRs of between 60% and 80% increased 6.1%, LVRs of 80% to 90% increased 14.3% and LVRs greater than 90% fell by -20.1% which was the largest year-on-year fall June 2010.  Based on the data it is clear that lenders have been tightening lending requirements over recent quarters which has led to a sharp decline in new mortgage lending for LVRs above 90%.
Overall the data indicates that the market is responding to regulatory changes in the lending space implemented over the past year.  There is less new lending to high LVRs, fewer low documentation and interest-only mortgages being written. 
On the other-hand some other potentially more risky lending types such as non-standard and outside of serviceability loans are continuing to rise.  It will be interesting to see whether APRA starts to look to crack-down on some of these types of lending in order to ensure stability within the mortgage market.
Cameron Kusher is research analyst for CoreLogic RP Data. You can contact him <a href="https://blog.corelogic.com.au/about/">here</a>.
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APRA data shows a further tightening of lending standards: Cameron Kusher

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The Reserve Bank of Australia released its Financial Aggregates data for January 2016, which showed credit growth of +6.5 percent in the year to January 2016, a steady increase on the +6.1 percent recorded for the year to January 2015.
<a href="/images/2016/03/RBA2.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/03/RBA2.jpg" alt="">
<div>Total annual housing credit growth has slowed a bit from its recent peak of +7.47 per cent in November 2015 to +7.33 per cent in January 2016, reflecting in part the shift in composition of lending from investors to owner-occupiers. </div>
<div> </div>
<div>Investor credit growth is now well below APRA's arbitrary +10 per cent threshold at just +7.9 per cent and consistently slowing from +11 per cent in June, meaning that theoretically major banks could in due course start to ramp up lending into this sector should they feel the urge to do so. </div>
<div> </div>
<div>Of course, any such move would be dependent upon a range of regulatory factors, and whether APRA has the appetite to loosen its throttle. Meanwhile owner-occupier annual credit growth recorded another significant jump in surging to a 64 month high of +6.95 per cent, with homebuyers looking to take advantage of attractive mortgage rates.</div>
<div> </div>
<div><a href="/images/2016/03/RBA1.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/03/RBA1.jpg" alt=""></div>
<div> </div>
<div>Deposit growth seems to present few headaches for banks right now. While term deposits have been understandably less popular in the prevailing low interest rate environment, total deposits with banks have expanded in a robust manner over the year to January. </div>
<div> </div>
<div><a href="/images/2016/03/RBA3.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/03/RBA3.jpg" alt=""></div>
<div> </div>
<div> </div>
<div>
<div>Business credit</div>
<div> </div>
<div>Business credit grew by +6.2 per cent in the year to January 2016, up from +5.5 per cent in the year to January 2015. It is as yet unclear whether this is the end of the uptrend for business lending growth, or a blip in the upwards trajectory. </div>
<div> </div>
<div><a href="/images/2016/03/RBA4.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/03/RBA4.jpg" alt=""></div>
<div> </div>
<div>
Housing credit The chart below shows how lenders in the housing market have conveniently managed to shift almost seamlessly away from investment lending to owner-occupier credit, with a bit of reclassification jiggery-pokery along the way. In fact, the data submitted by lenders makes it look as though the chart has been drawn up on an Etch-A-Sketch.
</div>
<div> </div>
<div><a href="/images/2016/03/RBA5.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/03/RBA5.jpg" alt=""></div>
<div> </div>
<div> </div>
<div>
<div>Total housing credit continued to push beyond $1.53 trillion, growing at an annual pace of +7.33 per cent, although naturally there are marked differences between the states and capital cities, with some faring much better than others. There have been a few pro-equities articles today discussing "plummeting" lending and investors "leaving the market in droves". That's interesting, but it's not what I'm seeing. Don't forget that housing credit expanding at a pace of +7 per cent implies a doubling in outstanding credit over a decade. It's all in the marketing, I guess.</div>
<div> </div>
<div><a href="/images/2016/03/RBA6.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/03/RBA6.jpg" alt=""></div>
<div> </div>
<div>
<div>The wrap</div>
<div> </div>
<div>Credit growth was fairly steady in January, with owner-occupiers continuing to pick up the baton from investors within the housing sector.</div>
<div> </div>
<div>A key question going forward will be whether having managed to push investor credit growth below its preferred +10 per cent threshold APRA releases its grip on investor lending at all. </div>
<div> </div>
<div>As APRA's data last week showed, the overwhelming majority of property buyers these days have substantial deposits, the question is whether tougher criteria are to be maintained surrounding mortgage serviceability. </div>
<div> </div>
<div>Another key factor could be movements in the cash rate, with interest rate cuts potentially set to stimulate demand for mortgage borrowing further, although it appears likely that lenders would hold back 10bps to15bps of a prospective 25bps interest rate cut.</div>
<div> </div>
<div>Adding to the parts of GDP we already know such as net exports, the Business Indicators released by the ABS this morning including inventories (-0.4), wages (+0.5), and company profits (-2.8), each suggested that headline GDP growth for the fourth quarter of 2015 is likely to be weak. </div>
<div> </div>
<div>These GDP partials may prove to be another tack in the coffin for the next movement in interest rates being down. </div>
<div> </div>
<div>
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 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>.
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</div>
</div>
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Owner-occupiers lead housing lending: Pete Wargent

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East coast residential developer Sunland reported a dip in net profit to $3.2 million but has reconfirmed full-year earnings of up to $29 million, given anticipated second-half property settlements.
Sunland managing director Sahba Abedian said he had also noticed a cyclical pull-back in bank lending for new properties.
"I do feel there is some adjustment taking place where banks are becoming more stringent on their lending, and that is in respect to lending to developers as well," Mr Abedian said. 
"I think it is partly regulation, but I also feel they have a view to the cycle," the Australian Financial Review reported.
"Despite the prevailing headwinds, we continue to see opportunities in specific market segments in Brisbane, the Gold Coast and Sydney's northern beaches, and our recent acquisitions in these locations are expected to contribute to earnings growth in the short to medium term."
Sunland has a total of 855 contracts on hand with a combined value of $663 million, with an estimated 380 settlements during the second half of the year.
He said a sustained focus on operational efficiencies enabled the group to achieve an average return on development of 25 per cent, above a target of 20 per cent.
 
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jchancellor-FAypfDUnLy

Sunland secures 25 percent returns on its residential development

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This week marks the fourth consecutive week of the combined capital city clearance rate being above the 70 percent mark, with the stronger than expected auctions results continuing through the final week of February.  
Capital city auction results haven’t recorded a four week period where the clearance rates was consistently higher than 70% since early September last year.  Based on 2,113 reported results, the preliminary clearance rate across the combined capitals was 72.4 percent this week, having strengthened from 71.8 percent last week when 2,347 auctions were held.
Auction activity continues to pick up with 2,620 auctions scheduled this week; however is yet to reach the same levels seen at the same time last year which is more than likely attributed to Melbourne’s Labour Day public holiday falling a week later this year.
Last year’s final auction clearance rate for the week was 76.4 percent across a total of 3,238 auctions. The robust rate of auction clearance, together with the CoreLogic Home Value Indices continuing to show a moderate rate of growth through February suggest housing markets are continuing to demonstrate a controlled slowdown rather than any signs of a sharp correction.
<a href="/images/2016/02/29/Screen%20Shot%202016-02-29%20at%209.13.44%20AM.png" target="_blank">Click to enlarge</a>
<img src="/images/2016/02/29/Screen%20Shot%202016-02-29%20at%209.13.44%20AM.png" alt="" width="800" height="427">
 
Melbourne’s preliminary clearance rate this week is 75 percent, up from 74.1 percent last week, but lower than the 77.1 percent of properties that sold at the same time last year. This week 1,327 residential homes were taken to auction, having increased from 1,105 the previous week. 
At the same time last year 1,565 Melbourne auctions were held, however volumes were higher due to the scheduling of the Labour Day weekend the following week. Melbourne’s top performing sub-region this week was the Inner South, where both a high volume of auctions were held (224) and the strongest clearance rate achieved at 83.9 percent. Inner Melbourne had the most auctions this week (289), however the clearance rate was the second lowest of any Melbourne sub-regions at 71.8 percent.
<a href="/images/2016/02/29/20160229-Melbourne.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/02/29/20160229-Melbourne.jpg" alt="" width="800" height="541">
 
This week Sydney’s preliminary auction clearance fell to 73.3 percent, following on from the previous week’s result of 76.5 percent. There were 872 auctions held, rising from 800 last week, but lower than the 1,223 over the comparable week one year ago. A higher proportion of auctions were successful this week in Sydney’s Eastern Suburbs (86.9 percent) and Ryde (81.6 percent), however the most auction activity occurred in North Sydney and Hornsby with 173 auctions.
<a href="/images/2016/02/29/20160229-Sydney.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/02/29/20160229-Sydney.jpg" alt="" width="795" height="541">
 
The number of Brisbane homes taken to auction this week was similar to last week, with 175 held, compared to 172 the previous week. The preliminary auction clearance rate strengthened to 58.3 per cent this week, having risen from 53.1 per cent. Compared to the final months of 2015, Brisbane’s clearance rate so far this year has been consistently stronger. This week 43 Gold Coast auction results have been reported with a preliminary clearance rate of 48.8 per cent.
 
<a href="/images/2016/02/29/20160229-Brisbane.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/02/29/20160229-Brisbane.jpg" alt="" width="788" height="527">
 
There were 118 Adelaide auctions held this week and preliminary results show a success rate of 72.7 per cent after having dipped to 64.6 per cent last week when 112 auctions were held. One year ago 109 Adelaide homes were taken to auction with a strong clearance rate of 76.7 per cent.
<a href="/images/2016/02/29/20160229-Adelaide.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/02/29/20160229-Adelaide.jpg" alt="" width="799" height="545">
 
The number of Perth homes taken to auction this week remained steady, with 47 scheduled auctions compared to 42 last week and 46 the previous week. Preliminary results show the cities clearance rate sitting at 44.4 per cent.
Across Canberra, 72 homes were taken to auction this week. Preliminary results show a clearance rate of 69.6 per cent, up from 61.9 per cent the previous week.
So far 5 Tasmanian results have been reported with 3 sales.
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smiller-vwPjRHTkST

Capital city clearance rate remains above 70% for the fourth consecutive week: Shana Miller

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Dwelling rental growth is now at its lowest level on record according to the first CoreLogic RP Data Rental Review for 2016. Currently the median rent rate is recorded at $443 across the combined capital cities. 
CoreLogic RP Data has tracked annual rental changes since 1996 and over that time, rental growth conditions have never been weaker. At the same time last year rental rates had increased by 1.7 percent highlighting that the slowdown in rental conditions has been sharp over the year.
A combination of factors is affecting the national rental market. Among these is a higher level or rental stock resulting in greater options for renters, a slowdown in population growth, higher than normal investment activity and stagnant wage growth. 
More rental stock at a time when demand is easing due to slowing population growth, and little wage growth for renters, has resulted in flat rental growth conditions over the past year. 
For renters there is a lot more accommodation options in the market while simultaneously, landlords are now required to respond to a more competitive environment which, in many cases means keeping rents steady or in some areas reducing rents in order to keep a tenant. 
CoreLogic RP Data analysis shows rents across the combined capitals rose by 0.2 percent in January 2016. The only capital cities to see a rise in rents over the month were Sydney, Melbourne, Adelaide, Hobart and Canberra, elsewhere rents dropped. 
Across the individual capital cities, over the past year: 
Rents increased in Sydney (+1.4 percent), Melbourne (+2.1 percent), Hobart (+0.1 percent) and Canberra (+1.8 percent). 
Rental rates have fallen over the past year in Brisbane (-0.7 percent), Adelaide (-0.4 percent), Perth (-8.6 percent) and Darwin (-13.4 percent). 
Across every capital city except Canberra the rate of annual rental growth or decline is currently lower than it was a year ago indicating that the weaker rental market conditions are prevalent across most capital cities. 
Rental Market Update: 
Weekly rents across the combined capital city measure increased 0.2 percent over the month of January however they were unchanged over the past 12 months. 
Currently, combined capital city rental rates are $487/week for houses and $465/week for units. 
It is possible that over the coming months, rental rates could begin to fall on an annual basis due to additional new rental supply entering the market.
 
Cameron Kusher is research analyst for CoreLogic RP Data. You can contact him <a href="https://blog.corelogic.com.au/about/">here</a>.
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Softest conditions on record for capital city rental markets: Cameron Kusher

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According to the just-launched CoreLogic-Moody’s Analytics Australian Forecast Home Value Index, home values are forecast to continue rising solidly in Sydney and Melbourne over the next decade. 
<a href="/images/2016/02/29/Modys.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/02/29/Modys.jpg" alt="">
 
<div>It sees annual price growth of more than +5 per cent returning for Perth by 2017, but subdued growth for Adelaide over the next two years, while Darwin prices are expected to decline in 2016.</div>
<div> </div>
<div>Of the capital cities, Brisbane is forecast to fare best over the next two years with home value growth of around +12 per cent.</div>
<div> </div>
<div>
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 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>.
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10 year home price forecast for Sydney: Pete Wargent

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The hotel industry was characterised by mixed fortunes in 2015, with the second half continuing the trend from the first, according to Deloitte Access Economics' Tourism and Hotel Market Outlook.
Sydney had the country's highest hotel occupancy at 88%, with a room rate growth of 8.8% annualised for the second half of the year, signalling that room rate growth expected to accompany such lofty occupancies is finally materialising.
Across Australia, room nights sold were up 3.3% from the 2.5% observed over the year to June. National room rates growth similarly accelerated over the second half of the year.
Fortunes were mixed across the major markets, with key outlook highlights:
- While rates in Melbourne grew 4.5% for the year, 93% occupancies in November were a record for the city
- Hobart, a market an eighth the size of Melbourne by turnover, recorded the same feat in the same month
- Queensland’s beaches posted the biggest gains in occupancy, with the Gold Coast and Tropical North Queensland recording increases of 3.0% and 4.8% respectively from a year earlier, although the latter was due to some properties being taken out of service for renovation
- Mining hubs lagged as supply increases combined with softening demand to drag both occupancy and room rates lower in Brisbane, Perth and, especially, Darwin
- Brisbane hoteliers, who had a good run during the G20 meeting at the end of 2014 with room rates at record highs, struggled to see growth for most of 2015
- Despite significant supply increases, the Darwin market effectively contracted 8.4% over 2015, as measured by total takings
- Canberra was the quiet achiever, where additions to supply masked 10% growth in room nights sold.
Hotel market outlook
Looking forward, 64 properties are due online before the end of 2018 across the nine major hotel markets analysed in the outlook. This represents a significant increase in the supply pipeline from Deloitte's August 2015 report, with the new room count up 12% in likelihood adjusted terms. Another 30 projects are mooted for regional hotel markets, although many are in the 50-room category.
Activity is not limited to additions in supply, with transaction volumes well up on previous years. Sixty-two existing hotel sales were recorded in 2015, with an aggregate value of AU$3.77bn, AU$1.2bn more than 2014.
Key Outlook forecast points, include:
- 8,650 rooms are expected to be added to the nation’s major hotel markets, and a further 3,900 in other regional markets, over the next two-and-a-half years, pushing supply higher at an average annual pace of 1.7%
- The supply growth outlook is led by Perth, with likelihood-adjusted expectations of an additional 1,900 rooms by the end of 2018
- Hobart has nine properties in the pipeline, and will undergo its own small boom in hotel construction, with room nights available increasing at 5.6% per year
- Over the next three years, supply growth is expected to be healthy, but more moderate, in Brisbane (4.1% per year) and Adelaide (4.0% per year)
- In Sydney and Melbourne, where 90% average occupancy is in sight, supply is still forecast to trail demand despite a number of high profile projects coming onto the market over the next three years
- Of any market, the relative growth prospects have improved most for Canberra given its hotel stock upgrades and refurbishments, and the expected arrival of direct international flights from Singapore and Wellington
- The projected national performance outlook remains one of demand growth (3% per year) outstripping supply growth (1.6%) and occupancies forecast to climb 2 percentage points to just above 71% by December 2018.
“The range of forecast performance across markets is widening as the sector’s growth drivers shift. With corporate travel following the nation’s economic transition back to the south east, so too is short stay accommodation demand, in turn putting further pressure on the already stretched Melbourne and, particularly, Sydney markets," Deloitte Access Economics partner Lachlan Smirl said.
“At the same time, a resurgent domestic leisure segment is buoying demand for holiday hot spots from Tasmania to Queensland’s beaches and emerging Asia continues to propel markets successful in luring these high growth segments."
The Gold Coast is projected to post the largest occupancy gains leading up to the 126,000 visitors expected for the Commonwealth Games in April 2018.
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Sydney leads hotel occupancy, rest share mixed fortunes in 2015 second-half: Deloitte study 

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Our prediction in 3-4 months ago about Melbourne overtaking Sydney has been confirmed by the latest price data.
In one of our November reports we noted: “Melbourne is the new star of Australia’s capital city property markets. It’s only a matter of time before Melbourne overtakes Sydney as the price growth leader in capital city Australia.”
We reported then that Melbourne continued to deliver a large number of growth markets, while Sydney was steadily waning. In Hotspotting’s latest survey for the Price Predictor Index, Melbourne continues to record strong sales activity, even though the number of rising suburbs is gradually diminishing. 
The number of Melbourne suburbs with rising sales trajectories in the past four quarterly surveys has been 134, 113, 110 and 105. This suggests Melbourne has passed its peak in terms of sales activity, but still has good impetus, while the price peak will probably come later in the year. 
The best of Melbourne’s precincts continue to be a mix of middle and outer-ring suburbs, with growing evidence that the previously-strong markets in the Top End near-city areas have subsided. 
Areas dominated by Top End suburbs – such as the LGAs of Glen Eira (Bentleigh, Caulfield, McKinnon), Boroondara (Balwyn, Ashburton, Glen Iris) and Stonnington (Armadale, Malvern, Prahran) – now have mostly Plateau markets, which are suburbs where sales activity has reached a peak and started to taper off at those levels or slightly lower levels (i.e. no longer rising). 
But there are numerous strong middle-market areas – notably the municipalities of Whitehorse (Box Hill, Nunawading, Blackburn), Banyule (Macleod, Montmorency, Watsonia), Moreland (the Brunswick and Pascoe Vale suburbs) and Bayside (Beaumaris, Black Rock, Hampton) – with significant numbers of growth suburbs. 
Whitehouse, previously a clear leader in the Melbourne market, has faded a little and is now matched by the LGAs of Banyule, Moreland and outer-ring Casey in terms of suburbs with rising trajectories. 
Other previous contenders Monash (Oakleigh, Mt Waverley, Clayton) and Knox (Wantirna, Boronia, Bayswater) have waned somewhat and, like Whitehorse, now have more Plateau markets than rising ones.
But there is now considerable energy in markets in the outer ring precincts. Locations likely to attract first-time buyers and others on smaller budgets are really pumping in Melbourne. 
In the far south-east, the Casey LGA (Cranbourne, Doveton, Endeavour Hills) matches those leading middle-market areas for the number of growth suburbs. 
Close behind are Brimbank (Sunshine, Deer Park, Cairnlea) in the western suburbs and Whittlesea (Epping, Thomastown, Mill Park) in the north of the metropolitan area. 
Market up-cycles often start in or near the city centre, with the millionaire suburbs the first to experience a rise in activity. As the cycle progresses, the growth ripples out to the middle-ring areas and latterly to the outer-ring suburbs. It’s common for the cheaper areas to have the greatest growth in the latter stages of the cycle, which often is in the third year of heightened activity. 
Sydney’s recent boom generally followed that pattern and Melbourne’s period of busy market activity (without producing the same high level of price growth across the whole city) has done likewise. 
So the evidence suggests that Melbourne is the leading capital city market - although it has passed or is close to its peak, depending on how you measure these things.
I note that the latest NAB Quarterly Residential Property Index finds that Victoria (read Melbourne) has replaced NSW (read Sydney) as the state with the most positive market sentiment and is currently the only state tracking above its long-term average. 
It’s also worth noting that Melbourne is Australia’s leading city for long-term capital growth (the average annual growth in prices over the past 10 years). 
Melbourne gets a lot of its impetus from population growth - it’s the leading capital city both for overseas migrants and for net inflow from interstate migration - and many of the leading suburbs for long-term capital growth are those that attract migrant buyers.
 
Terry Ryder is the founder of <a href="https://www.hotspotting.com.au/" target="_blank">hotspotting.com.au</a>. You can <a href="https://mailto:ryder@hotspotting.com.au" target="_blank">email him</a> or follow him on <a href="https://twitter.com/hotspotting" target="_blank">Twitter.</a>
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terryryder-YECXbqmri2

Where Melbourne is pumping: Terry Ryder

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Boutique advisory firm Moelis &amp; Co is closing in on a deal to buy pubs portfolio Redcape Hotel Group, according to the well-placed Street Talk column in the Australian Financia Review.
It is understood Moelis and Redcape have signed a heads of agreement, which will allow final due diligence.
Moelis reduced its offer for Redcape earlier this month after share market volatility meant the initial public offering was off the table.
It was suggested the current offer price is around $620 million compared to $650 million.
An ASX listing was considered last year with hedge funds York Capital and Varde Partners cashing out. 
Redcape owns 23 pubs in NSW.
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