Family-owned builder and developer <a href="https://www.apartments.com.au/developers/omaya">Omaya</a> is bringing its 27-storey The Maybelle development to market, with the 229-apartment tower rising alongside Ismay Reserve near North Strathfield.

<a href="https://www.apartments.com.au/new-apartments/the-maybelle-21-parramatta-road-homebush-nsw-2140">The Maybelle</a> will comprise one, two and three-bedroom apartments, with its height providing elevated outlooks towards the Sydney skyline and Harbour Bridge, while other residences will look across neighbouring Ismay Reserve.

Designed by <a href="https://www.apartments.com.au/architects/squillace-architects">Squillace Architects</a>, the tower combines its parkside setting with proximity to the established retail, dining and transport amenity around North Strathfield.

[smartcode_project:default project_id=134873 project_image_fid=376196]

Residences will feature open-plan living spaces and a choice of two interior schemes, while communal amenity is spread across two elevated levels of the building.

Level 8 will be home to the Garden Pavilion, a full-floor resident space incorporating communal entertaining and breakout areas, seating and recreation spaces. Further up the tower, a landscaped Sky Terrace on Level 14 will provide another communal area with panoramic views towards the Harbour Bridge and Sydney skyline.

At ground level, the development sits directly alongside Ismay Reserve, where lawns, walking paths, children's play areas, picnic spaces and recreational facilities extend the green space available immediately around the project.

[smartcode_project:default project_id=134873 project_image_fid=376194]

The Maybelle is also within walking distance of North Strathfield and the Bakehouse Quarter, which provides a mix of cafés, restaurants, shops and everyday services.

Existing rail and bus services provide connections across Sydney, while the future North Strathfield Metro and access to the M4 will add to the transport options available around the precinct. Walking and cycling routes also extend via Powells Creek towards Sydney Olympic Park and its sporting, entertainment and parkland precincts.

Families are also well positioned for access to a broad selection of established schools and education options across Strathfield and the surrounding Inner West.

[smartcode_project:default project_id=134873 project_image_fid=376181]

Omaya has operated in Sydney for more than 35 years, managing projects from acquisition and design through to construction and delivery. The family-owned company is both developer and builder of The Maybelle.

Apartments start from $560,000, with the development protected by 10-year Latent Defects Insurance.

Construction is well underway, with completion expected by the end of 2026 and move-in anticipated from Q1 2027.

[smartcode_project_cta:default project_id=134873]

Joel Robinson

The Maybelle brings 27-storey parkside tower to market near North Strathfield

Melbourne developer <a href="https://www.apartments.com.au/developers/pdg-corporation">PDG</a> has unveiled its vision for the former Water Tank Site in Ivanhoe, which would see it transformed into a thriving residential neighbourhood, complete with a 2000 sqm public park.&nbsp;

Delivered in partnership with <a href="https://www.apartments.com.au/developers/development-victoria">Development Victoria</a>, the proposal would transform the prominent corner of Bell Street and Upper Heidelberg Road into a connected community comprising two residential buildings, generous public open space and shared amenities.&nbsp;

The vision includes 287 one, two and three-bedroom apartments, with a minimum of 10 per cent allocated to affordable housing, alongside a 2,000-square-metre publicly accessible park featuring a children's playground, activity lawn, indigenous planting, timber climbing logs, seating areas and a rock gathering circle.&nbsp;

Designed by <a href="https://www.apartments.com.au/architects/dko-architecture">DKO Architecture</a>, the proposal draws on the site's industrial heritage, using a robust architectural language that references the former water tank through expressive structural elements and durable, self-finished materials.&nbsp;

Extensive landscaping has been woven throughout the development, creating a living landscape that strengthens connections to nature while responding sensitively to the surrounding neighbourhood. Two residential buildings ranging from three to 12 storeys are linked by a landscaped forecourt, creating a welcoming arrival experience and improving pedestrian connections through the site.&nbsp;

Residents would also enjoy more than 1,000 square metres of communal open space, including barbecue and dining facilities, vegetable gardens, landscaped seating pavilions and a dedicated coworking space.&nbsp;

PDG Founder and Managing Director Vince Giuliano said the vision reflected an opportunity to transform one of Ivanhoe's most recognisable sites into a place that balanced housing, community and landscape.&nbsp;

"This is an opportunity to reimagine an important site and create a neighbourhood that delivers lasting benefits for Ivanhoe," Giuliano said.&nbsp;

"We're creating much more than new homes. The vision brings together affordable housing, quality architecture, meaningful public open space and shared places that encourage people to connect, while respecting the site's history and its place within the local community."&nbsp;

Development Victoria’s Executive General Manager Precincts, Niall Cunningham, said the application is an important step for the government-owned site.&nbsp;

“This is about delivering more homes in a well-connected location, along with public open space that the Ivanhoe community will benefit from for years to come,” Cunningham said.&nbsp;

PDG was selected as development partner in late 2025 following a competitive tender process.&nbsp;

A planning submission for the project is currently being progressed through the Victorian Government's Development Facilitation Program, with positive early engagement from both Banyule Council and the Department of Transport and Planning.

PDG unveils plans to transform landmark Ivanhoe Water Tank Site

Shane Wilkinson's <a href="https://www.apartments.com.au/developers/pace-development-group">Pace Development Group</a> has lodged plans for a major residential precinct on the former Presentation College site in Windsor, with an eight-building masterplan ultimately rising to 10 storeys.

The proposal at <a href="https://www.apartments.com.au/new-apartments/167-dandenong-road-windsor-vic-3181">167–187 Dandenong Road</a> spans a substantial 19,027 sqm site and is being progressed across six stages, with the first residential stages comprising 170 homes across four buildings designed by <a href="https://www.apartments.com.au/architects/cera-stribley-architects">Cera Stribley</a>.

Stage Two will deliver the bulk of the initial housing, with Building A comprising 81 apartments and Building B 49 apartments, both rising to six storeys.

Stage Three will deliver a further 40 homes. The heritage Nagel Building, identified as Building C, will be converted to 12 dwellings, while a new five-storey Building D will comprise 28 apartments at the Hornby Street and Dandenong Road corner.

The 170 homes across Stages Two and Three will include a mix of one, two and three-bedroom apartments, including townhouse-style dwellings.<img alt="First look: Pace plans landscaped housing precinct on former Windsor school site" data-entity-type="file" data-entity-uuid="83c56e3e-dfb9-4e12-b172-c3f18513ec32" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Article%20Feature%20Image%20%28Grid%29_9.png?VersionId=xRcRpSZsxX.UX_NDDGcRZktw7HVrzx7u" />

&nbsp;

The longer-term masterplan points to considerably greater density across the site.

Indicative plans show Building E accommodating around 80 dwellings across up to 10 storeys, while Building F is earmarked for around 120 dwellings and also up to 10 storeys. Building G is planned to range between four and 10 storeys, however its apartment yield is yet to be determined. That means the masterplan currently identifies at least 370 dwellings across Buildings A to F before any apartments within Building G are counted.

Across the 1.9-hectare site, that represents an indicative density of at least 194 dwellings per hectare, with the final figure to increase once the yield of Building G is established.

Pace is pursuing the project through the Victorian Government's Development Facilitation Program, with Urbis lodging a combined Section 96A planning scheme amendment and planning application on behalf of the developer, which secured the site earlier this year.

The application seeks detailed approval for Stages One, Two and Three, alongside approval of the broader masterplan framework that will guide the later residential stages. Stage One will see an existing heritage building adaptively reused for a wellness and fitness-related facility, while the broader precinct will retain several significant heritage buildings and established trees as part of the redevelopment.

A minimum 10 per cent affordable housing contribution is proposed across both the initial residential stages and the later masterplan stages, delivered through a discounted rental model.

The project comes immediately after a major change to the site's planning controls.

The site was rezoned to the Housing Choice and Transport Zone through Planning Scheme Amendment GC285, gazetted on July 22, 2026, and now sits within the inner catchment of the Windsor Station precinct under the State Government's Train and Tram Zone Activity Centres Program.

While the new controls identify large sites within the inner catchment for buildings of up to six storeys, Pace's masterplan pushes height to 10 storeys in parts of the site, with the taller buildings concentrated toward the centre and along the Sandringham railway corridor.

Lower-scale built form is proposed toward the site's more sensitive residential and heritage edges, with Buildings A and B generally stepping from three storeys at their interfaces to six storeys at upper levels.

Cera Stribley's masterplan breaks the development into a collection of separate buildings rather than a continuous built form, with landscaped spaces, new pedestrian links and a new publicly accessible road forming part of the precinct.

The planning report says the development will create new pedestrian connections to Elm Place and along the railway corridor, as well as a new publicly accessible road linking Elm Place with Dandenong Road. The proposed buildings will occupy around 54 per cent of the site, leaving a substantial portion available for landscaping, communal areas and permeable surfaces.

Urbis said the scale of the project reflected the site's strategic location close to Windsor Station, tram services and the Chapel Street Activity Centre, with the former school campus identified as a significant opportunity to increase housing supply on an underutilised inner-Melbourne site.

&nbsp;

First look: Pace plans landscaped housing precinct on former Windsor school site

<a href="https://www.apartments.com.au/developers/jl-place">JL PLACE</a>'s Veil Brighton is approaching its final months of construction, with the nine-townhouse development at 17 Rooding Street expected to complete in December 2026.

The milestone is bringing the boutique project closer to becoming a finished part of the <a href="https://www.apartments.com.au/developments/brighton-vic-3186">Brighton</a> streetscape, with much of Brighton's everyday amenity within a short walk.

Palace Cinema, Coles Supermarket and North Brighton Station are all around five minutes on foot from <a href="https://www.apartments.com.au/new-townhouses/veil-brighton-17-rooding-street-brighton-vic-3186">Veil</a>, alongside numerous cafés, restaurants and bars. The station provides a direct rail connection toward Melbourne's CBD, while Bay Street and the wider Brighton retail and dining network add to the range of services accessible without relying on a car for every trip.

"The location was fundamental to the project. Brighton is an established suburb where many buyers already have strong connections to the area and want to remain close to the people, places and amenities that form part of their everyday life," the developer said.

"Veil sits in a highly walkable part of Brighton, with a Walk Score of 90/100."

For buyers looking to right-size within Bayside, that level of walkability adds to the appeal of a more manageable way of living. Everyday shopping, dining, entertainment and public transport can be accessed without relying on the car for every trip, while residents remain connected to the places and routines that make Brighton familiar. It allows buyers to simplify day-to-day life without giving up the convenience, amenity and connections they already value.

[smartcode_project:default project_id=7877 project_image_fid=355754]

As completion approaches, the architecture, landscaping and material palette are progressively becoming visible on site, giving prospective purchasers a clearer view of the finished development beyond its plans and renders.

Veil comprises nine townhouses, predominantly three-bedroom homes with between 2.5 and 3.5 bathrooms, two car spaces and, depending on the residence, study areas and private outdoor space. Selected homes include a bedroom on the ground floor.

Veil occupies a middle ground between detached housing and apartment living, retaining private gardens, storage and secure parking within a more manageable residential format.

<a href="https://www.apartments.com.au/architects/schmidt-pang-architects">Schmidt &amp; Pang</a> designed the architecture around natural light, ventilation, privacy and practical use of space. From Rooding Street, the façade has been composed to read as a cohesive residential building rather than nine individual townhouses, with landscaping by <a href="https://www.apartments.com.au/landscape-architect/john-patrick-landscape-architects">John Patrick Landscape Architects</a> integrated throughout the site.

Inside, natural stone, oak flooring, integrated joinery and brushed nickel finishes establish a restrained material palette, while kitchens include Miele appliances and substantial storage such as pantries. Walk-in robes and dedicated study spaces have also been incorporated across the collection.

[smartcode_project:default project_id=7877 project_image_fid=355852]

The project team said the planning of the homes has been informed by how the spaces function for both daily routines and larger gatherings.

"Our new homes owners at Veil have enjoyed the attention to detail in creating efficient layouts that use every space well. Hosting Christmas lunch and large family gatherings is an ease when care is taken to consider how people really live and entertain."

Private landscaped gardens extend the living spaces outdoors, while secure basement parking and bicycle parking are provided below. The homes have also been designed to achieve a 7-star energy rating, supported by double glazing, high-quality insulation, natural ventilation, LED lighting, water tanks and water-efficient fittings. Each residence is backed by a 10-year building guarantee.

Veil is being built by <a href="https://www.apartments.com.au/builders/jeniton">Jeniton</a>.&nbsp;Limited-time stamp duty savings are also currently available on selected purchases at Veil, adding another consideration as the project moves toward completion.

[smartcode_project_cta:default project_id=7877]

Veil Brighton nears completion in one of the suburb's most walkable pockets

<a href="https://www.apartments.com.au/developers/mosaic-property-group">Mosaic Property Group</a> has recorded 134 sales worth just over $400 million in two months of pre-release activity at The Riversdale, as the developer brings its $750 million South Brisbane riverfront project to the broader market.

The sales represent more than 60 per cent of the project's 213 apartments, with Mosaic reporting the majority of purchasers have been local owner-occupiers and downsizers.

<a href="https://www.apartments.com.au/new-apartments/the-riversdale-by-mosaic-south-brisbane-91-montague-road-south-brisbane-qld-4101">The Riversdale</a> will rise 39 storeys from its north-facing site at 91 Montague Road, delivering a mix of two, three and four-bedroom apartments alongside a collection of Mosaic's premium Masterpiece Series Sky Homes.

[smartcode_project:default project_id=151614 project_image_fid=371872]

The early buyer response comes ahead of the wider evolution of the northern end of Montague Road, where The Riversdale will be one of the first major residential projects delivered within an emerging riverfront precinct.

Directly adjoining the development is a planned 7.1-hectare mixed-use precinct, set to introduce new residences, parkland and public realm along the river's edge. The Riversdale's position directly on the Brisbane River gives it a relationship with the waterfront that Mosaic says cannot be replicated by future buildings within the precinct.

The site is also the result of a years-long pursuit by Mosaic. The developer first earmarked the <a href="https://www.apartments.com.au/developments/south-brisbane-qld-4101">South Brisbane</a> property in 2018, reflecting what Founder and Managing Director Brook Monahan has described as a deliberately patient approach to acquiring development sites.

[smartcode_project:default project_id=151614 project_image_fid=372083]

"We aren't opportunistic," Monahan previously told Apartments.com.au.

"Every site purchase is carefully considered. As seen with Kangaroo Point and South Brisbane, it can take years to eventuate. There are sites we're looking at now that we may not secure for several years."

Designed in collaboration with <a href="https://www.apartments.com.au/architects/bureauproberts">Bureau Proberts</a>, The Riversdale has been shaped around the qualities of the riverfront site, with apartments oriented to capture northern light and uninterrupted Brisbane River views.

Generous floorplans and expansive balconies extend the living spaces towards the river, while natural materials and a restrained interior palette have been selected with longevity in mind.

[smartcode_project:default project_id=151614 project_image_fid=371890]

Residents will have access to a level of amenity more commonly associated with world-class hotels and private members' clubs, with almost 3,000 sqm dedicated to wellness, connection, recreation and everyday convenience.

At ground level is a business lounge, private meeting rooms and dedicated workspaces. Mid-tower is a wellness sanctuary featuring magnesium hot and cold plunge pools, sauna, steam room, infrared therapy facilities, a Pilates and yoga studio, and a commercial-grade gymnasium.

Crowning The Riversdale is a rooftop featuring a 35-metre swimming pool with lap lane and spa, outdoor dining and seating terraces, firepit lounges and views of the city, river and Mount Coot-tha.

A private members' club-inspired retreat offers private dining rooms, a whisky lounge, media rooms and immersive entertainment experiences. Completing the amenity offering are two hotel-style guest suites and a resident-exclusive electric vehicle fleet and car-share program.

[smartcode_project:default project_id=151614 project_image_fid=371877]

The Riversdale sits at the northern end of Montague Road between South Bank and West End, around 1.3 kilometres from the Brisbane CBD, providing access to the city's major cultural, dining and recreation precincts.

It becomes Mosaic's largest Brisbane project to date and adds to a pipeline already under construction across the city.

In Brisbane, the developer is currently delivering The Bedford and The Carter at Kangaroo Point, both of which are approaching sell-out, with a further four projects being delivered on the Gold Coast. Mosaic has completed more than $2 billion in projects since 2012 and has a further development pipeline exceeding $2 billion across South East Queensland.

Early works are underway at The Riversdale, which will be delivered by Mosaic's in-house construction division. Completion is anticipated in late 2029, with remaining apartments priced from $1.98 million.

[smartcode_project_cta:default project_id=151614]

Mosaic records more than $400m in two months at South Brisbane's The Riversdale

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

<html><body>
<img src="/images/2015/06/05/Holdencapital_banner.jpg" alt="" width="532" height="112">
 
SPONSORED POST
With interest rates at levels not seen for generations, the conditions are ripe for fresh approaches to construction funding methods and while the majority of construction debt is sourced from the major banks.
HoldenCAPITAL have utilised their experience and real-time market data to access alternative lending institutions securing some attractive alternatives to suit individual client needs. This includes the sourcing and negotiation of Joint Venture Partnerships and passive equity investment for medium to large sized projects.
The HoldenCAPITAL team is often asked what is the difference between bank and non-bank funding and in most instances there are only three significant differences:
• Interest rate  • Pre-sales requirements  • the amount of equity commitment required from the borrower.
Two of these factors are easily quantifiable but what about the question of pre-sales?
Pre-sales or no Pre-sales 
Interest rate and equity requirements might initially indicate that one option be preferred over the other, but if we assess their specific requirements with a full understanding of the project and market conditions, the best choice might not be the most obvious. The best way to illustrate this is by way of a case study that HoldenCAPITAL has prepared.
<a href="/images/2015/06/17/holden1.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2015/06/05/holden1.jpeg" alt="">
<a href="/images/2015/06/17/feasibility_holden.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2015/06/05/holden2.jpeg" alt="">
 
Funding table comparison 
Bank and non-bank lenders have different requirements regarding loan ratios. Most non-bank lenders are so called gross realisation (GR) lenders and the main criterion for them is a loan to value ratio (LVR) of no more than 65%. Bank lenders also require a maximum LVR of 65%, but in addition they impose a limit of no more than 80% of the total development cost (TDC).
<a href="/images/2015/06/17/holden_3.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2015/06/05/holden3.jpeg" alt="">
These differences in lending criteria allow you in many cases to borrow more when choosing the non-bank option. In this case study, the required equity contributions are:
• Bank option of $1,118,100, compared to  • Non-bank option of $603,240 – a significant reduction.
The internal rate of return (IRR) on an investment or project is the annualised effective compounded return rate. It is commonly used to evaluate projects and gives a return that can be compared against the annual cost of capital. As can be seen in the graph below, as a result in the lower requirement for equity, the non-bank option shows a much higher return on equity and the internal rate of return is more than double that of the bank option.
<a href="/images/2015/06/17/holdenlast.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2015/06/05/holden4.jpeg" alt="">
The benefits of managing project timing 
The bank option benefits from a significantly lower total interest cost however, the non-bank alternative does not require the delay of between 3-6 months associated with the pre-sales requirement and benefits from a lower requirement on developer equity with the potential for a significantly increased return on investment.
The key differential is that the non-bank option potentially allows the project to be completed in a shorter timeframe with a consequential reduction in the potential for a market shift to impact the project viability. 
Daniel Erez, Managing Director of New Ground Properties endorses these points noting that “For every pre-sale we currently secure we could probably sell 4-5 near completed units…”.
In the case of a no-presales option “… we are still providing the same de-risking strategy by selling out prior to completion, the difference is that it is happening later in the project … you don’t need to fund the pre-sales and commissions are paid 100% from settlement proceeds.”
To find out more about which option best suits your next project, contact Dan Holden at HoldenCAPITAL on 0401 669 502 or visit HoldenCAPITAL <a href="https://www.holdencapital.com.au" target="_blank">here</a>. 
 
</body></html>

jchancellor-FAypfDUnLy

Bank Vs Non-Bank in townhouse project funding: Holden CAPITAL case study

<html><body>
As coincidence would have it I recently had a conversation with Dr Hazel Easthope, Senior Research Fellow, City Futures Research Centre UNSW following the news last month of yet another delay being announced in the now long over due review of NSW Strata Title legislation.
It has been confirmed that the Strata law reforms in NSW are to be delayed (again) with changes now not due to come into force until July next year. That’s another 18 months, which for such an important area of reform appears almost to be neglected.
The plans have been delayed several times since being announced in 2011. The reforms to the state’s 50-year-old strata laws are now urgent, but this message appears not to being heard by the State Government. In part a series of ministerial changes have hampered the process, but concerns among apartment dwellers are on the rise, and their concerns are justified.
The research being undertaken by Dr Easthope is looking at the experience of people living in strata titled property. Her work will look at details of people and seek to learn about their experiences of living in an apartment, and what they like and dislike about strata tile living. How strata title impacts the feeling of ‘home’ and how the quality of building management impacts residents. It’s notable that the quality of building management is now a key issue for many apartment buyers and investors.
The aim being to better understand the needs of different people living together in strata schemes and what can be done to make them more attractive places for everyone. The survey is due to be completed by 30thJune 2015 and I look forward to seeing the results.
The survey can be accessed at <a href="https://www.be.unsw.edu.au/research-centres-and-clusters/city-futures/about-us" target="_blank">City Futures</a>, and along with Dr Easthope I will keep readers up to date on the survey and related topics.
 Also in a national survey on strata-titled property conducted by Queensland’s Griffith University, the author, Professor Christopher Guilding has named building defects as the main challenge for apartment owners, which was also identified as the biggest issue for strata lawyers, and in the top five by resident building managers.
As a result the SMH recently reported that Professor Guilding is calling for a federal government inquiry about the issue, which must also put even more pressure on the NSW review process.
Professor Guilding will be releasing the results of the Inquiry Into Key Challenges In Australian Strata Title in September at the launch of the biennial national conference Strata and Community Title in Australia for the 21st Century.
The work by Professor Guilding and Dr Easthope appears very opportune and may well be central to helping to maintain the quality of life for the many apartment owners and future buyers across Australia and I am sure there will be a lot of valuable information and insights to share.
Peter Chittenden is managing director for residential of Colliers International. He can be contacted <a href="https://www.projectagenda.com.au/" target="_blank">here</a>.
</body></html>

pchittenden-eLqUUC8TWW

Yet more strata legislation delays: Peter Chittenden

<html><body>
Most of the price data that clutters up the airways is essentially useless information.
Boffins sitting in an office in Paris look at a number which says “Australian property values rose 9% in the past year” and imagine that tells them something about conditions in the fictitious creature they call the Australian property market.
Suddenly we have the OECD telling us we’re at risk of a price correction after gazing at Australia through an out-of-focus telescope across a distance of 17,000km. Seriously, these turkeys have no right to even express an opinion. Especially as that opinion is based on a meaningless statistic.
I’ve read in the past two weeks at least five different figures purporting to describe the median cost of the home in Sydney, ranging from $750,000 to $1 million.
Most of them are fanciful and inaccurate but that doesn’t stop commentators from giving them enormous import. The walking talking ego generally known as Graham Richardson pontificated that the average Sydney home cost a million dollars and declared that no one could afford that. The statement was inherently absurd because if the Sydney market is raging and a million dollars is the median price, clearly a lot of people can afford it because half of all sales are higher than that median figure.
The bottom line is: the average, mean or median is not a million dollars. CoreLogic RP Data’s latest figures suggest the median dwelling price for Sydney is currently $752,000. The other bottom line is that this figure is meaningless and misleading when you understand that Sydney has over 700 suburbs with median house prices ranging from $345,000 to $3.46 million.
It’s particularly meaningless and misleading in this context: first-home buyers can’t afford to pay $752,000 therefore, according to the misinformed, we have an affordability crisis which means we need to scrap negative gearing, ban foreign investment, cut out all first-home buyer grants because apparently they just inflate prices, introduce lending restrictions, call another federal parliamentary inquiry because the 18-month inquiry recently concluded didn’t discover anything new and savage the Federal Treasurer for daring to suggest a good job enhances your prospects of getting a loan.
The end result: truth, accuracy, balance and fair play just took another hammering - but, hey, lots of newspapers got sold.
The latest edition of Market Monitor from the Real Estate Institute of Queensland highlights how unhelpful it is to quote a single price statistic for an entire large city.
CoreLogic RP Data says the home value index for the Greater Brisbane area rose 3.1% in the past 12 months. Domain says the median house price increased 2.8%.
What do you deduce from that? That the Brisbane market is lukewarm? That growth in the city is anaemic at best? Richardson, in his irresponsible outburst on Sky News last week, declared Brisbane had recorded “no growth for years”.
You have to look deeper, otherwise you’re wasting everyone’s time.
Market Monitor shows the median house price for the Brisbane City local government area rose 7.2% in the year to April. So the Brisbane City Council area has been better than the wider Brisbane metropolitan area. 
And many individual suburbs did considerably better than that. Northgate grew 12.7% and Holland Park 13.5%, while Chermside rose 18.4% and Nudgee 17.3%.
A scan of the figures suggests that the middle market suburbs of Brisbane City have done much better than the LGA average, which in turn in much higher than the Greater Brisbane average result.
But media quotes the area average rise, which creates a quite misleading impression.
If you take the time to look through a report like Market Monitor, there are hundreds of stories about suburban and town markets, all doing different things influenced by local events - oblivious to the level of interest rates or the ignorance of media talking heads or the pompous proclamations of twits working for a bureaucracy based in Europe.
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> 
Terry was joined by Property Observer editor at large Jonathan Chancellor yesterday for a webinar on why research is the key to successful property investing in 2015. You can download slides and audio from the webinar here.
</body></html>

terryryder-YECXbqmri2

Accurate price data or useless information? Terry Ryder

<html><body>
As someone who works analysing housing markets every day it is good to see that housing policy is back on the agenda especially considering that we currently don’t have a Federal Housing Minister.  The lack of a Housing Minister at the Federal level is intriguing when you look at some of the statistics relative to the housing market.
According to CoreLogic RP Data the total value of residential property at the end of May 2015 was $5.9 trillion.  To put this in perspective, gross domestic product (GDP) for Australian was recorded at $1.587 trillion over the 12 months to March 2015. 
The Australian Bureau of Statistics’ housing finance data showed that as at April 2015 there was $1.392 trillion in outstanding mortgage debt to Australian banks, building societies and credit unions.  Meanwhile, the share market garners plenty of attention, as at April 2015 the market capitalisation of listed domestic equities was $1.693 trillion.  Based on this data it would be fair to say that housing is Australia’s largest and arguably most important asset class. 
Even the value of Superannuation clocks in at a much lower $2 trillion, nearly three times smaller than the overall value of housing.
Given the importance of shelter and the runaway growth currently being experienced in Sydney and, to a lesser degree, Melbourne home values, it is no wonder that housing is becoming a politically very sensitive topic.  In particular negative gearing has become a topic of plenty of debate over the past few weeks. 
While the current Government have ruled out changes to negative gearing, both the Labor and Green parties are highlighting potential changes to their policies.
Negative gearing allows owners of investment properties to offset their expenses (losses) against their taxable income and as a result it can reduce their taxable income.  While this most certainly makes investment attractive the suggestion that negative gearing alone drives up the cost of housing is somewhat debatable.
<img class="aligncenter size-full wp-image-4979" src="https://blog.corelogic.com.au/wp-content/uploads/2015/06/Chart-12.jpg" alt="Chart 1" width="500" height="180">
The above chart shows the total value of net rent claimed by individual taxpayers by financial year up to 2012-13.  Net rent is gross rent minus applicable deductions such as rental interest, depreciation and costs such as capital works.  What you will immediately note is that prior to 1999-00 the net profit or loss made from rent was fairly negligible. 
The Federal Government made changes to capital gains tax in September 1999 and this has seemingly helped to make negative gearing much more attractive than it was previously.  In September 1999 the Federal Government made changes which offered investors a 50% discount on capital gains tax when they sold their property if they held their investment for at least 12 months. 
As the first chart shows, since thes 1999-00 financial year net rental losses have spiked.  This would seem to suggest that the 50% discount to capital gains tax has conspired to make negative gearing of residential property a much more attractive investment option.
<img class="aligncenter size-full wp-image-4980" src="https://blog.corelogic.com.au/wp-content/uploads/2015/06/Chart-22.jpg" alt="Chart 2" width="500" height="110">
If we take a look at the most recent financial year’s taxation data available there are some interesting statistics about negative gearing and who is claiming the benefit. In terms of the number of individuals claiming net rent, 68.9% of claimants had a taxable income of less than $80,000. 
While more taxpayers with a taxable income of less than $80,000 claim net rent losses, only 13.1% of all individuals with a taxable income below $80,000. 
On the other hand, more than a quarter (25.8%) of all taxpayers with an income of more than $80,000 claimed net rent.  In terms of the value of these losses, individuals earning less than $80,000 claimed rental losses of $2.781 billion or an average of $2,050 per claimant.  Individuals earning more than $80,000 claimed $2.613 billion in rental losses at an average of $4,276 per claimant. 
More people on incomes below $80,000 claim rental income but that is largely due to the fact that 81% of taxpayers had a taxable income of less than $80,000.  Conversely, a greater proportion of total higher income earners own rental properties and the typical losses claimed from these properties are much larger than those with taxable incomes below $80,000.
<img class="aligncenter size-full wp-image-4981" src="https://blog.corelogic.com.au/wp-content/uploads/2015/06/Chart-32.jpg" alt="Chart 3" width="500" height="182">
In my opinion negative gearing is essentially a way in which the Government outsources social housing to the private sector or at least this should be how it works.  If we take a look at dwelling approvals data you can see that very few new approvals have been granted to the public sector over the past three decades. 
Typically more than 90% of all dwelling approvals over any month are granted to the privates sector with very few being approved and ultimately constructed by the public sector.  Ultimately the private sector takes on the role of construction of homes and it appears private citizens are incentivised to provide rental accommodation via the provision of negative gearing. 
If negative gearing were removed no doubt housing would still be an attractive investment for some who are seeking to be positively geared however, you may find that fewer people are attracted to housing as an investment option because of the absence of the tax deductions which negative gearing provides.
The data shows that a greater number of people on lower taxable incomes claim rental losses than those on higher incomes however, as a proportion of total taxpayers a greater proportion of high income earners claim rental losses and the value of these losses is greater for higher income earners.  The longer term net rental losses chart indicates that negative gearing alone didn’t really result in a high level on net rental losses however, when the capital gains tax discount was halved that seemingly made negative gearing much more attractive and the losses began to add up.
While scrapping negative gearing would likely provide a saving to the Budget bottom line, I believe it is unlikely to result in the substantial improvement in housing affordability that many are hoping for.  Arguably removing the capital gains discount which was introduced after negative gearing is a good first step to addressing the problems and then Government can revisit negative gearing.
The housing market has many moving parts that result in relatively expensive housing prices here in Australia.  While the removal of negative gearing may help improve the Budget bottom line it is unlikely to be the silver bullet which improves housing affordability. 
Zoning restrictions on developable land which drive up the cost of housing, the tax-free nature of the family home, stamp duty, the mass-centralisation of our population and shortage of jobs away from the major capital cities all conspire to make housing less affordable. 
Any discussion about improving housing affordability shouldn’t solely focus on just one of the issues such as negative gearing rather it needs to look at all of the factors which contribute to high housing costs.
Cameron Kusher is RP Data’s senior research analyst. Follow Cameron on Twitter <a href="https://twitter.com/cmkusher" target="_blank">here</a>. 
</body></html>

ckusher-ujnxiKuFQs

CGT 50% discount spiked negative attractiveness as investment option: Cameron Kusher

<html><body>
I’m struggling to find a time when the bureaucrats and politicians struggled as much as they presently are when trying to define what exactly is happening to the Sydney property markets – please note that I have used plural as against the popular and misrepresented singular definition.
Australia’s head cashier Joe Hockey is having an absolute shocker given he hails from a family that has a rich real estate heritage. For example, last week he stated that more houses were needed to fix the home affordability issue. “I like many others, if you have a home, if you’re already there with a mortgage; you wonder how your children are going to get into it.” Well Joe, for starters I would immediately slash the foreign buying policy where you allow 100% of all new housing developments to be sold offshore to foreign buyers.
Then one week later announced that he “totally understands” housing in Sydney and Melbourne is expensive and advised first home buyers to “get a good job that pays good money. ”If you go back 10 years first home buyers represented 10% of the overall market – today they are struggling to record a 5% market participation. The Sydney and Melbourne property markets are overwhelmingly being driven by property investors and foreign buyers.
The real truth of the matter is that the Coalition and ALP don’t care about the buyers, or where they come from for that matter, this is all about strengthening the economy where real estate is now doing all the heavy lifting. The crux of the matter is that the property sector now contributes more to Australian gross domestic product (GDP) than mining. The property sector is estimated to generate 11.5% of GDP, employs 1.1 million Australians and pays $72.1 billion in state, federal and local real estate taxes each year.
Then we have Australia’s head teller Glenn Stevens pointing at another rate cut due to a weak economy given that the Australian economy is now weaker than forecast two years ago. In 2013 the projection was that the economy would be growing at a rate of 2.5% to 4% although by mid-2015 it will be lucky to post a growth rate of 2.5%. Stevens also commented this week that he is concerned about Sydney’s booming house prices – you see he used the term house although houses in certain parts of Sydney are not doing that well when compared to apartments.
Our research division has been recording some interesting Mosman ‘house’ sales.
<ul>
<li>Stanley Avenue Mosman sold in 2010 for $12.000 and resold in 2015 for $12.300</li>
<li>Coronation Avenue Mosman sold in 2012 for $4.200 and resold in 2015 for $4.125</li>
<li>Botanic Road Mosman sold in 2013 for $2.750 and resold in 2014 for $2.550</li>
<li>Parriwi Road (apartment) sold in 2010 for $1.050 and resold in 2014 for $1.010</li>
<li>Parriwi Road (apartment) sold in 2010 for $2.250 and resold in 2014 for $2.150</li>
<li>Bradleys Head Road sold in 2007 for $5.400 and resold in 2015 for $5.100</li>
<li>Raglan Street Mosman sold in 2006 for $4.500 and resold in 2015 for $4.750</li>
</ul>
The problem is purely that house prices are bundled as against separating houses from apartments and investors from owner occupiers. Let’s not start on what part the foreign buyers play in this equation given nobody has really bothered to measure this participation rate but I would add that it’s huge and much, much higher than the federal government ever envisaged (when they do get around to looking).
Glenn Stevens was using the HSBC research that found Australian house prices had risen 24 per cent in the past three years, though the gains had been mostly confined to Sydney and Melbourne – so why then call this Australian house prices? Sydney had jumped 39 per cent and Melbourne prices were up 22 per cent bringing the average price growth for the rest of the country at 10 per cent.
The real problem Australia is facing is getting the economy stimulated and thus far all the monetary measures have been a dismal failure. Yet again, the problem is contained directly in Canberra and the refusal to implement reform so on that basis I can see where Glenn Stevens is coming from.
Cast your mind back to 2008 when Ken Henry presented the Henry Tax Review (the Rudd government held on to it until 2010) – we need to remember what Ken Henry said at the time “Ken Henry warns of looming taxation crisis”, and said that need to change is urgent. In 2014, he warned that the Abbott government urgently needs a tax and welfare package to head off an imminent budget crisis.
Well we have a budget crisis and no tax reform and as Ken Henry put it “there will be a day of reckoning.” One only has to ask a simple question – where would the Australian economy be today had the Henry Tax Review been implemented?
So what we have is politicians only interested in re – election so any thought of reform is immediately removed until we get hit with a major economic downturn. The Henry Tax Review was designed to drive the economy and therefore minimise the likelihood of another economic downturn as experienced with the Global Financial Crisis. Governments don’t pay payroll tax however if you asked businesses what they would do with the savings if it were to be abolished – you would see a much different Australian economy than we are seeing presently.
<h5>MOSMAN – 2088</h5>
• Number of houses on the market this time last year – 85
• Number of houses on the market last week – 61
• Number of houses on the market this week – 55
• Number of apartments on the market this time last year – 66
• Number of apartments on the market last week – 38
• Number of apartments on the market this week – 41
<h5>CREMORNE – 2090</h5>
• Number of houses on the market this time last year – 8
• Number of houses on the market last week – 6
• Number of houses on the market this week – 7
• Number of apartments on the market this time last year – 9
• Number of apartments on the market last week – 13
• Number of apartments on the market this week – 11
<h5>NEUTRAL BAY – 2089</h5>
* Number of houses on the market this time last year – 5
• Number of houses on the market last week – 5
• Number of houses on the market this week – 3
• Number of apartments on the market this time last year– 46
• Number of apartments on the market last week – 23
• Number of apartments on the market this week – 29
 
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. 
</body></html>

robertsimeon-hRNTwJyXkQ

It’s about the economy not the property buyers: Robert Simeon

<html><body>
From social housing to speculators. 
The first government-sold heritage terrace at Millers Point that fetched $1,911,000 just 10 months ago is back for sale.
The 1880s terrace was the first of scheduled 293 public housing properties to be sold off by Government Property NSW in August last year.
<a href="/expert-insights/buying/vacated-millers-point-four-level-terrace-fetches-1-911-000-at-private-state-government-auction">The then rundown four-bedroom heritage-listed</a> home had been vacant since early 2011 with the last public housing tenant paying $77.20 a week rent at the property which has water views over Walsh Bay.
The relisted <a href="https://sydneysothebysrealty.com/5095303/119-Kent-Street-Millers-Point" target="_blank">119 Kent Street, Millers Point </a><a href="https://sydneysothebysrealty.com/5095303/119-Kent-Street-Millers-Point" target="_blank">home</a> sits on a 109 sq m block with no parking.
The house has original fireplaces and floorboards, 3.25m high ceilings and a sandstone-walled sunlit courtyard.
It is marketed by Harriett France a Sotheby's as "recently refreshed with new kitchens and bathrooms - scope for further improvement."
Around $2.5 million is expected by the Sfeir family.
The controversial sell off, which has resulted in the relocation of public housing tenants, is tipped to set off a major gentrification in the historic suburb.
The state government <a href="https://rediscovermillerspoint.com.au" target="_blank">has created a website </a>to sell the virtues.
 
 
 
</body></html>

Quick flip profits sought for 119 Kent Street, Millers Point former state government offering 

<html><body>
Hi Margaret,
If I put a deposit to buy a house before the new financial year, can I claim it this year tax time or is it to late to buy? Also, is it greedy to buy our 4th house in 7 months?
Regards,
Thor
 
Hi Thor,
To answer this question we must first work out what can and cannot be claimed against your tax. The deposit on a house is not a claimable item. The costs you incur when you buy a property are able to be claimed, but each item is treated differently.  For example, all buying costs such as legal fees and inspections form part of your cost base, and serve to essentially reduce your payable capital gains tax when you sell, rather than provide an immediate deduction.  Borrowing costs are divided up over 5 years (or the length of time you own the property if less than 5 years) and claimed at the end of the year. I think you are really asking me whether the interest on the deposit is claimable, and the answer is no, for two reasons.  The first one is that any deduction you claim against your income is only available on an 'income producing asset', an at the stage where you pay a deposit, this property does not produce income, for you.  The second one is that the deposit does not denote a transfer of ownership, and so you don't legally own an income producing  asset against which you are allowed to make these claims - the present owner does however, and they are allowed to make those claims right up until you settle the property. As to your second question, it's not greedy to buy your fourth property in seven months, but whether it is wise to do so is an entirely different thing.  You need to ask the following questions: 
<ul>
<li>Do you know your personal risk profile and whether this number of properties is consistent with that?</li>
<li>Have you had an independent, professional investment plan prepared for you by someone who is not trying to sell property to you?</li>
<li>Have you analysed your capacity to meet your current debts and property costs should interest rates rise?</li>
<li>Have you ensured that you have diversified your property portfolio across a number of markets? Some of our markets (namely, Sydney) will likely enter a protracted period of stagnation after this present frenzy, so you don't want all of your properties to be in such a market?</li>
<li>Have you considered your financial future - is there any upcoming changes which may make a larger portfolio create extra stress on your finances?</li>
</ul>
You should not simply buy a property every time you feel like it, or each time the bank offers you more money - instead, your acquisition of property should be part of a carefully articulated plan which considers all of your personal financial circumstances, investing time horizon and risk profile.
Have a property question?  <a href="mailto:askmargaret@propertyobserver.com.au" target="_blank">Ask Margaret!</a>
</body></html>

mlomas-KC9MUPZ6Ca

Ask Margaret: Is it greedy to buy our 4th house in 7 months?

<html><body>
What a hoo-ha we experienced this week with Treasurer Hockey's comments when he dismissed suggestions that property in Sydney was unaffordable when he went on to say "If you've got a good job and it pays good money and you have security in relation to that job, then you can go to the bank and you can borrow money and that's readily affordable."
and "...if housing were unaffordable in Sydney, no one would be buying it," he said.
You know, it got me thinking back to 2003/4 when something similar was going on.  We copped the same media frenzy about the overheated Sydney market and that the boom would crash soon etc.
Then like now, when property becomes too expensive, usually in the cities, investors start to look for more affordable areas.
I was in the market investing in the early 2000's and that is exactly what I did. After settling four negatively geared Sydney properties, I realised there was no point to continue to buy such expensive property after all the capital growth had been realised as the market was peaking and back then the rental market was not as strong as it is now. I needed to find more cash flow positive property. Property that I could add value to and big blocks we could build multiple dwellings on so I could keep buying more. 
That’s when I discovered the Lower Hunter Region of NSW.
There are some people that think regional areas do not experience good capital growth. I track the quarterly median price in three of the regional cities Property Bloom develops in and my graph looks very healthy. There are no extreme spikes but healthy long term growth. Rental yields are around 7% gross on most of our completed developments and with cash so cheap right now, this is sure to present a good return in anyone's book. Also, the depreciation benefits on new property is a nice bonus.
Property Bloom has found a prime location that is currently experiencing good growth and high demand for the housing we are building for our clients. So forget about what some of our politicians are saying and get stuck into some solid research on regional cities and I bet you'll be pleasantly surprised.
<h1 class="Normal"> </h1>
 Jo Chivers is Chief Executive Officer of property development project managers <a href="https://www.propertybloom.com.au/about" target="_blank">Property Bloom</a>.
</body></html>

jochivers-wq5Bp59R5a

Copping the media frenzy: Jo Chivers

<html><body>
Amalgmated Holdings has paid $NZ28.5 million for the Museum Art Hotel in Wellington, New Zealand.
It was bought from local entrepreneur Chris ­Parkin.
It is to become a QT hotel.
Amalgamated Holdings managing director David Seargeant said Museum Art Hotel would be a great fit with the QT brand.
Amalgamated Holdings operates Rydges Hotels in Auckland, Rotorua, Wellington, Christchurch and Queenstown.
</body></html>

Amalgamated Holdings set to open QT Wellington, New Zealand

<html><body>
Australia's favoured share market index, the ASX 200 ("XJO"), continues to meander along, now miserably hovering below 5,500, having previously once again threatened 6,000.
It's a monster day ahead for news with the Labour Force figures out at 11.30am.
<div id="post-body-5375889496668172470" class="post-body entry-content">
<div>After a somewhat downcast speech from Reserve Bank Governor Stevens yesterday, analysts will be awaiting these latest figures with bated breath.</div>
<div> </div>
<div>Before we move on to look at the employment figures in detail, a quick look at why the residential construction boom has plenty of gas left in its tank yet.</div>
 New home finance up <div> </div>
<div>The <a href="https://www.propertyobserver.com.au/https://www.abs.gov.au/ausstats/abs@.nsf/mf/5609.0" target="_blank">Housing Finance</a> figures for April showed a moderate increase in the seasonally adjusted number of new dwelling commitments to 2,766 in the month.</div>
<div> </div>
<div>While this was an improvement on the March figure, smoothing the data on a 4mMA basis, shows that the trend looks to have passed its peak.</div>
<div> </div>
<div><img src="/images/2015/06/11/HF5.jpg" alt=""></div>
<div> </div>
<div>
<div>In terms of the value of loans written for new dwellings, the data recorded a record high of $1.03 billion in April, reflective of the expensive nature of new housing stock in Australia.</div>
<div> </div>
<div>Investors both domestically and from offshore pay a hefty premium to buy new, and this has taken rolling annual new dwellings finance its highest ever level at $11.6 billion.</div>
<div> </div>
<div><img src="/images/2015/06/11/HF1.jpg" alt=""></div>
<div> </div>
<div>
<div>Despite the trend in new dwelling commitments looking decidedly toppy, this overlooks that a sizeable percentage of new dwelling sales are made to foreign investors, particularly in Sydney, Melbourne, Brisbane, and elsewhere.</div>
<div> </div>
<div>Naturally enough, these offshore sales are not picked up in our domestic housing finance figures.</div>
<div> </div>
<div>Most other indicators, including record high building approvals and forecast dwelling starts, point towards an industry which is now at or approaching its full capacity.</div>
<div> </div>
<div>Typically skills and materials shortages at this stage in the construction cycle will lead to rapid inflation in the build cost of new dwellings, and there are already some indicators of this dynamic.</div>
<div> </div>
<div>In particular, the Reserve Bank's liaison work has noted a shortage of bricklayers and project managers in the residential space, despite the widespread availability of construction workers as the mining investment boom dies its long, slow death.</div>
<div> </div>
<div>Construction loans</div>
<div> </div>
<div>Unsurprisingly most buyers continue to seek finance to buy established property, although if you look closely, construction finance is rising steadily.</div>
<div> </div>
<div><img src="/images/2015/06/11/HF2.jpg" alt=""></div>
<div> </div>
<div>
<div>Drilling into this a little further, the rolling annual value of construction loans to owner occupiers appears to have peaked out at a record $22 billion.</div>
<div> </div>
<div>However, rolling 12 monthly construction finance commitments to investors continue to rise, now up to $9.1 billion of loans written, which is also a record high.</div>
<div> </div>
<div><img src="/images/2015/06/11/HF3.jpg" alt=""></div>
<div> </div>
<div>
Renovations <div> </div>
<div>If there is one genuine bubble in the Australian economy, it is surely in the irrationally exuberant number of renovation TV shows advertised on the television (I've never actually watched one, I should disclose...not my thing).</div>
<div> </div>
<div>Alas, outside Sydney, where renovations activity is both robust and rising, nobody seems to be undertaking any renovation projects themselves! </div>
<div> </div>
<div>Sure this was only the first month of the quarter, but the contribution to GDP growth from major alterations and additions in the second quarter of the year already looks likely like to be nil.</div>
<div> </div>
<div><img src="/images/2015/06/11/HF6.jpg" alt=""></div>
</div>
</div>
<div> </div>
<div>
 Meh. The wrap <div>Some survey indices have lately pointed to a contraction in apartment and attached dwelling construction.</div>
<div> </div>
<div>These indices are surely broken!</div>
<div> </div>
<div>Just a few days wandering around the capital cities and major regional centres would tell you as much.</div>
<div> </div>
<div>The residential construction boom continues, fuelled largely by sales to offshore buyers, and for this reason, the data on new dwelling commitments domestically doesn't give us the full picture.</div>
<div> </div>
<div>The construction loans data charted above - combined with record high building approvals and a strapping number of dwelling starts - imply that the next two years will see a sustained high level of activity in home building.</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 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.
</div>
</div>
</div>
</div>
</div>
</body></html>

Latest Investing Insights

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

Editor's Picks

Developments

New apartments

New townhouses

News

Latest Investing Insights

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

Editor's Picks

Receive the latest news stories to your inbox

Developments

New apartments

New townhouses

News