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


Joel Robinson

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

<p data-end="198" data-start="61">One of the penthouses at Lily Lane, the latest stage of Carrington Place by Ellipse Property, has set a new local apartment price record.</p>

<p data-end="350" data-start="200">The four-bedroom residence, purchased by a local downsizer, sold for $5.75 million—around 75 per cent higher than the previous record of $3.3 million.</p>

<p data-end="461" data-start="352">Over 40 per cent of the first release of apartments at&nbsp;<a href="https://www.apartments.com.au/new-apartments/lily-lane-at-carrington-place-castle-hill-32-carrington-road-castle-hill-nsw-2154">Lily Lane</a> have already been snapped up just six weeks since it launched to the market.</p>

<p data-end="461" data-start="352">&nbsp;</p>

<p>Located at 32 Carrington Road, <a href="https://www.apartments.com.au/developments/castle-hill-nsw-2154">Castle Hill</a> and designed by award-winning architects <a href="https://www.apartments.com.au/architects/ptw">PTW</a>, Lily Lane is directly opposite the Hills Showground Metro station. It offers a total 213 units over two 12-storey towers - a mix of 67 one-bedroom, 100 two-bedroom and 46 three-bedroom apartments - with a ground-floor retail offering.</p>

<p>[smartcode_project:default project_id=151821 project_image_fid=368352]</p>

<p>Blake Schulze, National Director – Residential at <a href="https://www.apartments.com.au/project-marketer/colliers">Colliers</a>, says around 44 per cent of buyers are&nbsp;owner occupiers, with 35 per cent being investors and 21 per cent first homebuyers.</p>

<p>“Developments of this calibre are very rare in the Hills District, and Lily Lane’s sales success demonstrates the depth of demand for over-sized apartments that genuinely compete with freestanding homes," Schulze says.</p>

<p>"We are seeing particular demand from downsizers who want to remain in the area but transition into spacious, high-quality apartment living."</p>

<p>On the penthouse sale, it says it shows buyers&nbsp;are prepared to pay a premium for scale, quality, and direct access to the Metro.</p>

<p>[smartcode_project:default project_id=151821 project_image_fid=368351]</p>

<p>One-bedroom apartments are sized from 50-72 sqm with prices starting at $745,000, while two-bedrooms are priced from $990,000 with sizes from 75 to 132 square metres. Three-bedroom floorplans are sized between 97 and 182 sqm,, with prices starting at $1,395,000.&nbsp;</p>

<p>The three remaining penthouses, spanning up to 262 sqm, are priced from $2.9 million.</p>

<p>Over 75 per cent of apartments include dedicated studies, multipurpose rooms or family rooms, with select layouts offering walk-in pantries and laundries. Apartments are appointed with premium Miele appliances including ovens, washing machines, dryers, gas cooktops and dishwashers, while larger residences also incorporate integrated Miele microwaves, Fisher &amp; Paykel integrated refrigerators and five-burner Miele cooktops.</p>

<p>[smartcode_project:default project_id=151821 project_image_fid=360285]</p>

<p>Lily Lane will be constructed by award-winning iCIRT-rated builder <a href="https://www.apartments.com.au/builders/decode">Decode Group</a>, with construction to commence in mid-2026 and expected to complete early 2029.</p>

<p>Carrington Place comprises more than 800 apartments and is being delivered across multiple stages, with completion expected in 2032. Integrated with neighbouring bushland, the project will feature over 20,000 sq, of outdoor recreational area, including a one-kilometre boardwalk to Fred Caterson Reserve.&nbsp;</p>

<p>The Hills Showground Metro Station is just a two-minute walk away, offering fast connectivity to Sydney’s CBD, North Sydney, Chatswood, Macquarie Park and Norwest Business Park.</p>

<p>[smartcode_project_cta:default project_id=151821]</p>


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

<p data-end="223" data-start="65">Fresh off completing its Delano Crows Nest development, Lindsay Bennelong has lodged plans for its next project, this time turning its attention to the beach.</p>

<p data-end="431" data-start="225">The developer, founded by Clarendon Homes founder Peter Campbell, is proposing a 37-apartment scheme at <a href="https://www.apartments.com.au/new-apartments/17-25-ashburner-street-manly-nsw-2095">17-25 Ashburner Street</a>, Manly, positioned between the southern end of <a href="https://www.apartments.com.au/developments/manly-nsw-2095">Manly</a> Beach and East Manly Cove.</p>

<p data-end="431" data-start="225">Lindsay Bennelong called on local architecture firm Platform Architects to design the new building, given their success on The Finn, Lindsay Bennelong's current luxury apartment project on North Steyne.<span style="font-size:12pt"><span style="font-family:Aptos, sans-serif"><span style="color:#222222"><span style="font-style:normal"><span style="font-variant-ligatures:normal"><span style="font-weight:400"><span style="white-space:normal"><span style="background-color:#ffffff"><span style="text-decoration-thickness:initial"><span style="text-decoration-style:initial"><span style="text-decoration-color:initial"><i>&nbsp;</i></span></span></span></span></span></span></span></span></span></span></span></p>

<p data-end="372" data-start="143">According to the Design Verification Statement by Bridie Gough of Platform Architects, the proposal “relates to the current context but also the desired future character of taller buildings suitable to the new planning controls.”</p>

<p data-end="722" data-start="374">The site has been identified as a Low to Mid-Rise Housing (LMR) location, given its position within 400 metres of the Manly Town Centre E1 Business Zone. The LMR controls are intended to unlock additional housing supply in well-located areas close to public transport, allowing developers to seek increased height limits to support greater density.</p>

<p data-end="884" data-start="724">“The proposal seeks to provide this increased level of housing whilst being respectful of some of the smaller scale buildings also nearby,” the statement reads.</p>

<p data-end="1207" data-start="886">Lindsay Bennelong Development Director Leigh Manser said the project has been carefully aligned with the intent of the LMR controls. The proposal will significantly increase housing yield on the site, replacing four houses and 10 apartments, comprising 25 bedrooms, with 37 new apartments delivering a total of 94 bedrooms.</p>

<p data-end="1487" data-start="1209">“Sydney is in a severe undersupply, and delivering more dwellings and more bedrooms than what currently exists is exactly what the LMR policy is designed to activate,” Manser said, noting that nine of the apartments will be allocated as affordable housing for frontline workers.</p>

<p data-end="1843" data-start="1489">“We have already commenced discussions with our community housing provider to determine the rental levels that frontline workers can realistically afford in this location,” he said. “These will need to sit well below the standard affordable housing benchmark of 20 per cent below market rent, and that has been factored into our feasibility and pricing.”</p>

<p><img alt="Manly" data-entity-type="file" data-entity-uuid="ad03000f-19f9-48b4-b27d-e85ca800a1da" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-04-30%20at%208.41.59%E2%80%AFAM.png?VersionId=a.txHwCZgbCInlQ6QXbIrI.umvW1T.r8" /></p>

<p data-end="1825" data-start="1664">The design of the building incorporates a wave-like indentation running through the façade, referencing the nearby coastline and anchoring the building within its local context.</p>

<p data-end="1825" data-start="1664">The&nbsp;Design Verification Statement says careful consideration has been given to the articulation of the building, ensuring the bulk is broken down to a more human scale through a defined four-storey podium."</p>

<p data-end="1825" data-start="1664">The scheme includes a mix of one-, two- and three-bedroom apartments.</p>

<p data-end="2146" data-start="1962">“The design ensures a high level of amenity, with apartments offering generous private open space, many with expansive views, and all with comfortable proportions."</p>

<p data-end="2146" data-start="1962"><img alt="Bennelong" data-entity-type="file" data-entity-uuid="6a7f2812-72a1-4959-84b0-997e8cd88aed" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-04-30%20at%2010.15.50%E2%80%AFAM.png?VersionId=6iMxU3MkXmHVHAoNhYBjnqgka8CUZNbk" /></p>

<p><a href="https://www.apartments.com.au/developers/lindsay-bennelong-developments">Lindsay Bennelong</a>&nbsp;is currently developing Finn Manly, just three full-floor luxury apartments on North Steyne. They recently welcomed residents to its 81-unit Delano Crows Nest development, a&nbsp;carefully scaled infill project designed to bridge&nbsp;<a href="https://www.apartments.com.au/developments/crows-nest-nsw-2065">Crows Nest</a>’s lively village centre with its surrounding heritage streets.</p>

<p>Designed by&nbsp;<a href="https://www.apartments.com.au/architects/ajc-architects">AJC Architects</a>,&nbsp;<a href="https://www.apartments.com.au/new-apartments/delano-crows-nest-27-57-falcon-street-crows-nest-nsw-2065">Delano</a>&nbsp;is arranged across three low-rise buildings, incorporating a mix of one, two, and three-bedroom apartments alongside a limited number of townhomes addressing Hayberry Lane. The architectural approach draws on the area’s Art Deco lineage, reinterpreted through contemporary detailing and framed by landscaped communal gardens.</p>

<p>The developer also has a development site in Maroubra.</p>


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

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


Madeline by Mosaic delivers penthouse-level living across every apartment

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


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

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


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

<html><body>
<p><span style="line-height: 1.3em;">I fear for investors enticed into buying generic off-the-plan apartments at over-the-top prices.</span></p>
<p>It’s happening in and around the CBDs of all our biggest cities but, increasingly, it’s also happening out in the suburbs. It’s not going to end well for many buyers.</p>
<p>Reports suggest people were clamouring at the weekend to buy units in a proposed development in central Blacktown, paying up to $775,000. </p>
<p>Nothing wrong with the location – I’ve been advocating the Blacktown area for a long time and it’s delivered handsomely with price growth averaging 13% per year over the past three years.</p>
<p>Blacktown is consistently the most popular suburb in Sydney in terms of sales numbers and the Blacktown City LGA is the leading municipality in NSW for population growth. </p>
<p>There were 940 homes sold in the suburb of Blacktown in the 12 months to May, according to Australian Property Monitors, with the median house price rising 19% and the unit median up 13%.</p>
<p><span style="line-height: 1.3em;">But paying the prices reportedly achieved in the Blacktown unit project is beyond reckless. </span></p>
<p>The median price for a Blacktown house on land is $545,000 and the mid-range unit fetches $385,000. To pay double the suburb’s median price for an off-the-plan unit flouts basic investment rules and defies common sense.</p>
<p>A couple of years from now, after all the heat and hysteria has evaporated from Sydney markets, I would hate to be the vendor trying to find a buyer for a Blacktown at $800,000-plus, assuming they’re hoping for some capital gain.</p>
<p>Apparently buyers queued up to “snap up” 106 units in Altitude Tower, a planned 24-storey building on the edge of Blacktown’s CBD. Most of them sold at the weekend, reportedly, to a mix of first-time buyers, next-time buyers and investors.</p>
<p>Prices ranged from $395,000 for a one-bedroom unit to $775,000 for a three-bedder on one of the upper levels.</p>
<p>One newspaper report featured a first-home buyer who paid $425,000 for a one-bedroom unit. The median price for all units sold in Blacktown in the past 12 months is $385,000, so where is the value in a one-bedroom unit at $425,000?<span style="line-height: 1.3em;"> </span></p>
<p>A couple of weeks ago I received an email from a consumer who was thinking of buying in the project. She was considering a two-bedder for around $600,000. I suggested it made no sense to buy a small unit at a price well above the suburb median for a three-bedroom house on land. A view over Blacktown does not justify the price distortion. </p>
<p>It’s a common phenomenon – new developer product marketed off-the-plan at prices that bear no relationship to established pricing levels in the location. It’s simply bad investing.</p>
<p><span>I was presented with a Melbourne example recently: </span>a townhouse project in South Morang with two-bedroom townhouses for $443,000, when you could buy the typical house on land for less than that. When the suburb’s unit median price is $310,000, a small townhouse for $443,000 is over the top. </p>
<p>I urge all investors considering purchases like this to ask themselves this question: is this the best buy I can find in Australia at this moment? </p>
<p>When buyers are considering off-the-plan developer product at inflated prices, the answer almost certainly is NO. </p>
<p><em>TERRY RYDER is the founder of <a href="https://www.hotspotting.com.au/" target="_blank">hotspotting.com.au</a>. You can <a href="https://mailto:ryder@hotspotting.com.au" target="_blank">email him</a> or follow him on <a href="https://twitter.com/hotspotting" target="_blank">Twitter.</a> </em></p>
</body></html>

terryryder-YECXbqmri2

Paying some top off the plan prices is just reckless: Terry Ryder

<html><body>
<div><span style="line-height: 1.3em;">There's a lot of drivel written about the supply response in Sydney causing a serious property market correction.</span></div>
<div> </div>
<div>It really depends on what property type and locations you're talking about.<br><br>
</div>
<div>Sure, I don't doubt that some of those buying new apartments off the plan in parts of the inner south will see prices fall.</div>
<div> </div>
<div>That's more or less certain to happen when the downturn phase of the cycle ticks around. </div>
<div> </div>
<div>There are some other areas where the market will be flooded by new apartments too, such as around parts of North Sydney.</div>
<div> </div>
<div>There's nothing new or surprising about this.</div>
<div> </div>
<div>But as an owner of property in a suburb like Pyrmont - where the supply of new sites has been totally depleted - it's hard to get too excited by the babble in the media.</div>
<div> </div>
<div>Prices in these parts will only be materially impacted by a lack of capacity to pay, which means very high interest rates (nah) or high unemployment (the unemployment rate in Pyrmont-Ultimo has increased from 2.8% to 2.9% over the past year).<br><br>A fair proportion of units are investor owned, of course, but in the current low interest rate environment cash flows are strong, while vacancy rates remain very low.</div>
<div> </div>
<div>
<div><strong><span style="text-decoration: underline;">Capped supply</span></strong></div>
<div> </div>
<div>To be quite blunt, it has long been obvious that property prices in Pyrmont would soar. </div>
<div> </div>
<div>With the population of Greater Sydney increasing by around 84,200 or so persons per annum - give or take - the demand side of the equation more or less takes care of itself in such a prime location suburb. </div>
<div> </div>
<div>As for new supply...well, there isn't any. </div>
<div> </div>
<div>There is none, because there is nowhere left to build.</div>
<div>
<br>Actually, strictly speaking that's not quite true.</div>
<div> </div>
<div>A <a href="/news">DA was lodged</a> to develop a few dozen apartments at 97 Pyrmont Bridge Road back in May 2013.</div>
<div>
<br>And down the road in the adjacent suburb of Ultimo there was a development application lodged in 2014 to build 50 apartments on Harris Street.</div>
<div> </div>
<div>So, there might be a very slight trickle of new supply in the area.</div>
<div> </div>
<div>
<div>But even though Harris Street is a pretty busy thoroughfare, land prices in these parts have been exploding higher over recent years, and ultimately the price of property is a derivative of the land that sits thereunder.</div>
<div> </div>
<div>The 485 Harris development fetched some $63 million, equating to a price per apartment of more than $1.25 million (in Ultimo!..on Harris Street!).</div>
<div> </div>
<div>So, no, I can't say I worry too much about the supply of apartments causing a price correction in Pyrmont.</div>
<div> </div>
<div>Now the South Dowling precinct on the other hand...the latest inner apartments report from BIS Shrapnel sums it up rather nicely.</div>
<div> </div>
<div><a href="/images/2015/08/06/BIS.jpg" target="_blank">Click to enlarge</a></div>
<div> </div>
<div><img src="/images/2015/08/06/BIS.jpg" alt=""></div>
<div> </div>
<div>
<div>Demand for apartments in Sydney from overseas investors in particular shows "little sign of abating", but there is plenty of supply due to come online in suburbs such as Zetland, Waterloo, Rosebery, Alexandria...and for that matter Mascot, Green Square et al.</div>
<div> </div>
<div><strong><span style="text-decoration: underline;">Apartment completions</span></strong></div>
<div> </div>
<div>Inner Sydney apartment should average around 3,100 per annum over the next few years to 2018 per BIS Shrapnel.</div>
<div> </div>
<div><a href="/images/2015/08/06/BIS4.jpg" target="_blank">Click to enlarge</a></div>
<div> </div>
<div><img src="/images/2015/08/06/BIS4.jpg" alt=""></div>
<div>
<div>But the new supply of apartments in Sydney will be very much skewed towards the inner south and the old urban wastelands around Sydney airport.</div>
<div> </div>
<div>49% of the new inner Sydney apartments will be in the South Dowling precinct, as compared to just 1% in Pyrmont.</div>
<div> </div>
<div><a href="/images/2015/08/06/BIS2.jpg" target="_blank">Click to enlarge</a></div>
<div> </div>
<div><img src="/images/2015/08/06/BIS2.jpg" alt=""></div>
<div><span>Or, to put that graphically:</span></div>
<div><span> </span></div>
<div><a href="/images/2015/08/06/BIS3.jpg" target="_blank"><span>Click to enlarge</span></a></div>
<div><span> </span></div>
<div><span><img src="/images/2015/08/06/BIS3.jpg" alt=""></span></div>
<div> </div>
<div>
<div>Much of property investment is about common sense. </div>
<div> </div>
<div>Invest in the areas where people really want to live but where there is nowhere left to build new supply. </div>
<div> </div>
<div>Unfortunately too many people do precisely the opposite by investing in areas where people don't really want to live and where there are stacks of sites on which to build.</div>
<div>
<br>Same applies in Brisbane by the way!</div>
<div> </div>
<div>Check out the full BIS Shrapnel report <a href="https://www.theurbandeveloper.com/wp-content/uploads/Inner-Sydney-Apartment-Market-Brief-July-2015.pdf" target="_blank">here</a>. </div>
<div> </div>
<div>
<p><span><em>PETE WARGENT is the co-founder of <a href="https://allenwargent.com/" target="_blank" rel="nofollow">AllenWargent</a> property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank" rel="nofollow">blogger</a>.</em><br></span></p>
<p><em>His latest book is <a href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx" target="_blank" rel="nofollow">Four Green Houses and a Red Hotel</a>.</em></p>
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A lot of drivel written about Sydney's supply response: Pete Wargent

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<p>The fundamental cynicism of major banks has been on display in the past week, with lenders exploiting APRA’s anti-investor measures to boost their profits.</p>
<p>Most major lenders have lifted interest rates for investors and then tried to represent the cash grab as a “we had no choice” situation caused by the regulators.</p>
<p>There is no justification for the interest rate hike. Lenders have already tightened their lending criteria in a number of ways designed to eliminate many fringe dwellers from the possibility of borrowing to buy investment properties.</p>
<p>The interest rate hike is clearly not motivated by a desire to further restrict investor activity. It’s simply a profit-boosting play which can be explained away, conveniently but dishonestly, as a consequence of APRA moves.</p>
<p>How do we know?  Because the big banks and other lenders have lifted interest rates on existing investor loans, not just on new ones.</p>
<p>Increasing interest rates on existing loans does nothing to reduce investor borrowing to buy real estate. All it does is boost bank profits. </p>
<p>If they were fair dinkum in their claims that they’re acting “as part of our commitment in meeting APRA’s benchmark” (as Westpac tried to claim), they would lift rates on new loans only.</p>
<p><span>The Bank of Queensland, which lifted its standard variable rate for investor loans 29 basis points, has a master of weasel words on staff called Matt Baxby who came up with this classic to justify the unjustifiable this week: “</span>We are adopting a prudent position that is aligned with the market and balances our own growth objectives with the risks associated with investor lending in general and the overall growth of investor lending in the market as a whole.”</p>
<p>If you can make sense of that statement, please write and let me know. I think a reasonable translation is: “We’re shafting a significant proportion of our existing customers but we’re hoping you won’t notice.”</p>
<p>Beyond that, the APRA measures and lenders’ response to them are an extraordinary case of overkill by bureaucrats who clearly don’t have a grip on market reality. </p>
<p>The faceless APRA boffins who make their pronouncements never stand up to be identified or face any scrutiny of their actions. If we had the opportunity to question them, whoever they are, I’m quite certain we would discover their understanding of real estate markets is wafer thin.</p>
<p>Essentially, Sydney is having a boom and all of Australia is being punished for it.</p>
<p>Taking punitive measures that apply nationally in response to an issue in Sydney is tantamount to amputating a leg to cure a sprained ankle.</p>
<p><span>I note </span>that the Property Investment Professionals of Australia (PIPA) has questioned the decision by lenders to increase interest rates for both new and established property investors, suggesting a different approach should’ve been taken to ensure a sustainable property market.</p>
<p>PIPA chair Ben Kingsley said APRA’s pressure tactics to force individual lenders to lock out investors have raised both concerns and question marks for the industry.</p>
<p>“Increasing borrowing costs for investors who bought into the market some time ago seems unfair and detracts from what should be the common goal of creating a balanced property market,” he said.</p>
<p>PIPA suggested that more targeted measures to slow new investor lending in certain areas, such as decreasing and restricting borrowing power for new investors in locations where the market is particularly heated, would have been a better approach.</p>
<p><span style="line-height: 1.3em;">Couldn’t agree more.</span></p>
<p><em>TERRY RYDER is the founder of <a href="https://www.hotspotting.com.au/" target="_blank">hotspotting.com.au</a>. You can <a href="https://mailto:ryder@hotspotting.com.au" target="_blank">email him</a> or follow him on <a href="https://twitter.com/hotspotting" target="_blank">Twitter.</a></em></p>
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Fundamental cynicism of major banks on display: Terry Ryder

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<p>The Preston house on the first season of Channel Seven’s renovation program House Rules has been listed for August 29 auction.</p>
<p>It is the home of the contestant brothers, Nick and Chris Stavropoulos.</p>
<p>John Petsinis from Hocking Stuart has the three bedroom, two bathroom weatherboard house.</p>
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<div id="link-photo"><img src="https://images.realestateview.com.au/pics/376/19-Jackman-Street-Preston-VIC-3072-Real-Estate-photo-1-large-9273376.jpg" alt="19 Jackman Street Preston VIC 3072 Real Estate Photo 1" title="19 Jackman Street Preston VIC 3072 House - Photo 1"></div>
<div> </div>
<div id="soldbanner">The property at 19 Jackman Street, Preston, last traded at $555,000 in mid-2012.</div>
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</div>
<p>One of its new features is the stacked-stone fireplace.</p>
<p>Jackman Street's most recent sale was $895,000 in July this year for another three bedroom 1930s cottage that last sold at $446,000 in 2008.</p>
<p>Nick and Chris, the Channel 7 Melbourne House Rules brothers handed over the keys to fellow renovation contestants of their Californian bungalow in Preston in 2013.</p>
<p>It came with a mortgage of $524,000 which would have beeen wiped off by Channel 7 if they had won the renovation competition series hosted by Johanna Griggs.</p>
<p><img class="img-responsive" src="/images/stories/flexicontent/l_houserulesmay30breakout.jpg" alt="Preston House Rules renovation with $524,000 mortgage after $555,000 brotherly purchase"></p>
<p>The 1930s bungalow went to July 2012 Ray White auction without success, subsequently listed at $580,000.</p>
<p>The brothers paid $555,000 in August 2012 for the 1930s bungalow on its 475 square metre block.</p>
<p>"A lot of our money went into our deposit," <a href="/news/preston-house-rules-renovation-with-524-000-mortgage-after-555-000-brotherly-purchase">the Stavropoulos brothers told the House Rules viewers</a>. </p>
<p>There was a subsequent $49,000 development application with Darebin Council.</p>
<p>The brothers, who also appeared on Channel 9’s Reno Rumble, have made a few minor alterations since the show, including extending the outdoor area.</p>
<p>No price guidance is being given.</p>
<p>The median price of houses in Preston has jumped 8.8 per cent over the past 12 months to $700,000, <a href="/news">according to CoreLogic RP Data</a>, having been at around $575,000 when the house was bought in mid-2012.</p>
<p> </p>
<p> </p>
<p> </p>
<p><span style="font-size: 12.1599998474121px; line-height: 1.3em;"> </span></p>
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jchancellor-FAypfDUnLy

Preston House Rules house hits the Melbourne auction market

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<p>When Australia’s head cashier Joe Hockey proudly announced that he had nailed an illegal foreign purchase with the $39.000 million sale of Villa del Mare or Villa del Nightmare as I prefer to call it he would not have realised he had opened the largest can of worms in Australian property history. Mark my words this is a now a major election issue that must be intelligently resolved given what is actually happening now is unprecedented and will cost a party an election if it continues to go unchecked and ignored.</p>
<p>I have said for many years now that the Foreign Investment Review Board (FIRB) is right up there in terms of the most hopeless departments in Canberra. As was the case with Villa del Mare you don’t need to contact FIRB all you need to do is just buy it and if investigated once the divestment order is issued just phone a friend (as was the case with Villa del Mare) and transfer the property into an Australian residents name – which is totally legal and requires no further questions. </p>
<p>This now opens the flood gates for all illegal purchases to follow suit as this is the legal precedent thanks to this approved divestment order. We can also expect criminals from all over the world will be eyeing Australian real estate as a wonderful vehicle to wash the proceeds of crime. What we have now is a person on unemployment benefits can appear as the owner on say a twenty plus million dollar home due entirely to the many legal loopholes. </p>
<p>When we look back on federal governments in action we note that they only act quickly on three things – terrorism, natural disasters and wars. When you look at what’s happening to Australian property you could say that today it has a bit of all three in its DNA. </p>
<p>The burning question is how do you fix this to ensure that the loopholes are closed once and for all? Well that’s easy as I have always been mystified as to why federal governments are so backwards and lazy in keeping records on Australian property. </p>
<p>All that needs to be done is when a property exchanges the lawyer or conveyancer immediately after exchange logs onto the Australian Taxation Office (ATO) website under Australian Property Register (password protected of course) and provides the name(s) of the purchaser, their address, who acted for them, the address of the property and wait for it – their tax file number. Then the ATO can wash this data as well as providing the information to the FIRB for review. </p>
<p>If you have a divestment order and the owner phones a friend to transfer the property into their name in order to hold onto the property. Then Joe Hockey should immediately get rid of his stupid $5,000 fee on a foreign purchase and replace it with an annual Federal Property Holding Tax at 1.75% of the calculated land value. In the case of Villa del Mare that would be a $525,000 annual tax – so get the foreign buyers to assist Australia in getting its budget back to surplus faster.</p>
<p>But sadly it’s just not that simple given from July 1 the Abbott government is set to release its Premium Invest Visa (PIV), which is for sale at $15 million. Once an applicant has completed their PIV and handed over the required $15.000 you are rewarded with permanent residency in less than twelve months. The PIV replaces the SIV (Significant Investor Visa) which required $5.000 million investment over a four year term to then get permanent residency. You could be excused for asking oneself just who exactly does the SIV and PIV benefit? But I’m sure you already know the answer to that. </p>
<p>In the meantime the House of Representatives Economics Committee has announced a “new” inquiry into home ownership. I find that simply fascinating given none of them would actually know what exactly they are looking for. The Chair of the Committee, John “Love ‘n Deuce” Alexander, said that ‘home ownership is an issue that lies at the core of the Australian dream and represents the largest investment that most taxpayers will make during their lifetime.</p>
<p>The importance of this issue throughout our nation makes it worthy of a detailed inquiry.’ Well isn’t that riveting? Submissions to the inquiry are requested by 26 June 2015, and the proposed reporting date is 03 December 2015. </p>
<p>Oh I get it the Abbott government will release its action plan just before the next election. See I told you foreign ownership is an election issue. </p>
<p>I wonder what will happen when I email them this blog titled ‘My Submission’.</p>
<p><strong>MOSMAN – 2088</strong></p>
<p>• Number of houses on the market this time last year – 102</p>
<p>• Number of houses on the market last week – 57</p>
<p>• Number of houses on the market this week – 57</p>
<p>• Number of apartments on the market this time last year – 72</p>
<p>• Number of apartments on the market last week – 50</p>
<p>• Number of apartments on the market this week – 49</p>
<p><strong>CREMORNE – 2090</strong></p>
<p>• Number of houses on the market this time last year – 7</p>
<p>• Number of houses on the market last week – 3</p>
<p>• Number of houses on the market this week – 4</p>
<p>• Number of apartments on the market this time last year – 27</p>
<p>• Number of apartments on the market last week – 13</p>
<p>• Number of apartments on the market this week – 10</p>
<p><strong>NEUTRAL BAY – 2089</strong></p>
<p>• Number of houses on the market this time last year – 7</p>
<p>• Number of houses on the market last week – 3</p>
<p>• Number of houses on the market this week – 3</p>
<p><span style="line-height: 1.3em;">• Number of apartments on the market this time last year– 48</span></p>
<p><span style="line-height: 1.3em;">• Number of apartments on the market last week – 31</span></p>
<p><span style="line-height: 1.3em;">• Number of apartments on the market this week – 27</span></p>
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Feds should hang up on the ‘phone a friend’ loophole: Robert Simeon

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<p>Queensland is a great example of how fussy investors need to be in selecting location.</p>
<p>The state has three of the four leading markets in regional Australia, and one of the more vibrant capital city markets, but also the greatest number of danger markets. </p>
<p>You could end up with a strongly-performing growth market and a basket case, depending on how well you choose your location.</p>
<p>Brisbane has had a fairly busy market for 18 months or so. It hasn’t produced a big price growth number, in terms of the average across the metropolitan area, in the way Sydney has, because the uplift in activity has been quite localized. </p>
<p>Some parts of the Greater Brisbane market, such as Logan City and the Moreton Bay Region, have seen elevated activity, but others have failed to deliver significant growth momentum, including Redland City and Ipswich City.</p>
<p>So you need to choosey about location.</p>
<p>South-east Queensland generally, with the Gold Coast and the Sunshine Coast added to Brisbane, is one of Australia’s rising markets. Both the coast markets have increasing sales activity and many suburbs are producing solid price growth. But again, you need to be careful.</p>
<p><span style="line-height: 1.3em;">The Sunshine Coast generally is buoyant but Noosa, which I have described frequently as Australian real estate’s biggest lemon, continues to struggle. And the Gold Coast may appear to be a growth market that should interest investors, but it has a poor record of growth because of bouts of oversupply – and developers are currently working hard to creating the next boom-bust scenario, which is a specialty of the Gold Coast.</span></p>
<p>Cairns joins the Sunshine Coast and the Gold Coast in providing three of the four biggest growth markets in regional Australia (the other biggest the City of Gosford). There are also signs that Townsville and the Fraser Coast are emerging. Toowoomba, one of the stars of regional Australia in recent years, remains solid - although the best time to buy there was two years ago.</p>
<p>But regional Queensland also has some of the worst places to buy. </p>
<p><span style="line-height: 1.3em;">In the new edition of <em>The Price Predictor Index</em>, six of the 12 locations which make up our National Dirty Dozen (the worst markets that must be avoided) are Queensland locations which had resources-related booms, only to have their markets undermined by developers who built too many dwellings.</span></p>
<p>They failed to take into account how many resources personnel would be staying in workers camps, rather than renting in the local towns. </p>
<p><span style="line-height: 1.3em;">In the most extreme cases, markets have been destroyed by over-building and the predominance of temporary workers camps. They include Central Queensland coal-mining towns like Moranbah and Dysart, and some of the Surat Basin towns where the coal seam gas boom produced a short boom followed by rapid decline, because 94% of resources personnel are accommodated in camps rather than rental houses.</span></p>
<p>To provide one stark example, the property market in Miles has been destroyed. There were no sales in the town in the March 2015 Quarter and only two in the December 2014 Quarter. The market no longer has sales to provide price statistics. The vacancy rate is 33%. </p>
<p>Before Miles disappeared off the radar screen, its median house price had dropped 27% in 12 months and it was taking six months, and discounting around 20%, to sell a house. In the past six quarters, house sales in Miles have dropped from 25 to 20 to 13 to seven to six to two to zero.</p>
<p>There are similar stories across regional Queensland – providing a timely reminder to investors that they need to be very careful about where they opt to buy.</p>
<p><em>TERRY RYDER is the founder of <a href="https://www.hotspotting.com.au/" target="_blank">hotspotting.com.au</a>. You can <a href="https://mailto:ryder@hotspotting.com.au" target="_blank">email him</a> or follow him on <a href="https://twitter.com/hotspotting" target="_blank">Twitter.</a></em></p>
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The best and the worst found in Queensland: Terry Ryder

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<div>The ABS released its <a href="https://www.propertyobserver.com.au/https://www.abs.gov.au/ausstats/abs@.nsf/mf/8755.0" target="_blank">Construction Work Done</a> figures for Q1 2015 which saw total construction work done decline by 2.4% to $48.4 billion.</div>
<div> </div>
<div>It's a bit of an awkward data release with a few moving parts, but let's see if I can simplify a few of the key messages here in three short parts.</div>
<div> </div>
<div><strong><span style="text-decoration: underline;">Part 1 - Total construction slips</span></strong></div>
<div>
<br>As you can see from my chart below, private sector building work is responding rather nicely to low interest rates.</div>
<div> </div>
<div>Unfortunately, on the other hand, spend in the public sector is contributing very little to the cause.<br><br>Quarterly public sector expenditure fell to below $2.2 billion, which is far below the more stimulatory levels seen through the financial crisis which peaked at more than $5 billion.<br><br>The economy could evidently use some infrastructure investment, though I'm not at all sure we'll get it.</div>
<div> </div>
<div>Meanwhile engineering construction, largely comprised of resources capital expenditure, continues to capitulate, now more than 20% lower over the past year to $24.8 billion in Q1, from a peak of $33.2 billion in 2012.</div>
<div> </div>
<div class="separator"><img src="/images/2015/05/28/wargent1.jpg" alt=""></div>
<p> </p>
<div>The net result is that total construction work done declined further in the first quarter by 2.4% to $48.4 billion.</div>
<div> </div>
<div>This is still a very high level of activity in historical terms, but now some 8.8% lower than one year ago.</div>
<div> </div>
<p><img src="/images/2015/05/28/wargent2.jpg" alt=""><br><br></p>
<div>The one shining light for construction - which you will have seen with your own eyes if you live in one of the major capital cities - is residential construction, which continues to pulse along.</div>
<div> </div>
<div>House building work done is picking up sharply, while the value of building work done relating to units and apartments (denoted by the red line below) continues to surge to new record highs through this cycle.</div>
<div> </div>
<div>Higher density developments - which tend to be located in cities and come with associated expensive land remediation costs - are contributing a surprisingly high proportion of residential building work done in chain volume measures terms.</div>
<p> </p>
<div class="separator"><img src="/images/2015/05/28/wargent3.jpg" alt=""></div>
<div class="separator"><span style="line-height: 1.3em;"> </span></div>
<div>Major renovations work, denoted by the green line, continues to flatline, and is basically on life support outside Sydney.</div>
<p><strong><span style="text-decoration: underline;">Part 2 - State versus state building</span></strong></p>
<p><span style="line-height: 1.3em;">The value of building work done is being driven by activity in Melbourne, Sydney and Brisbane, in that order, which should continue to support construction employment in those cities, combined with the associated </span><span style="line-height: 1.3em;">multiplier</span><span style="line-height: 1.3em;"> effect.</span></p>
<div>The building boom is largely bypassing the southern states, and this has been reflected in benign (Hobart) or negative (Adelaide) employment growth in the respective capitals of these states. </div>
<div> </div>
<div class="separator"><img src="/images/2015/05/28/wargent4.jpg" alt=""></div>
<div class="separator"> </div>
<div class="separator"> </div>
<div>Looking at the major component parts, Melbourne continues to be the undisputed king of house building, while Queensland and Western Australia saw a decent lift in activity in the first quarter of this year.</div>
<div> </div>
<div class="separator"><img src="/images/2015/05/28/wargeent5.jpg" alt=""></div>
<p><br><span>But the real fun and games are taking place in the apartment construction sector.</span></p>
<p><span style="line-height: 1.3em;">Sydney and Brisbane may be approaching full capacity in this industry, which a dearth of bricklayers and project managers on the eastern seaboard being reported by the Reserve Bank's liaison, despite the legions of construction workers becoming available for transfer as they are released from resources contracts (more on this below). </span><span style="line-height: 1.3em;"> </span></p>
<div>Activity in New South Wales pulled back a little in Q1, but Melbourne apartment construction continues to rip to record high levels, with nearly $6.5 billion of work done over the past year in Victoria, and $1.8 billion in the first quarter of 2015 alone.<br><br>Heady times.</div>
<div> </div>
<div class="separator"><img src="/images/2015/05/28/wargent6.jpg" alt=""></div>
<div class="separator"> </div>
<div class="separator"> </div>
<div>Clearly this is the macro level data only, but the figures clearly imply a looming oversupply of units and apartments in some locations.<br><br>Prospective investors clearly need to understand the property markets at a suburb and micro level in this respect.<br><strong><span style="text-decoration: underline;"><br></span></strong><strong><span style="text-decoration: underline;">Part 3 - The mining cliff</span></strong>
</div>
<div><strong><span style="text-decoration: underline;"> </span></strong></div>
<div>If you were hoping for good news for resources regions from this release, I'm afraid that there is none to report.</div>
<div> </div>
<div>Engineering construction work done held up reasonably well in Victoria, but everywhere else of note saw sharp declines, and particularly so the main mining states.</div>
<div> </div>
<div>The one exception in recent quarters had been the Northern Territory, with heavy spend related to the $34 billion Ichthys project pushing up engineering construction work done to record highs for the Top End over the preceding two quarters.</div>
<div>
<br>However, even the Northern Territory saw engineering construction work done decline from $2.1 billion to $1.7 billion in the first quarter, with some delays to the planned 2017 start-up date having been reported related to Inpex.</div>
<div class="separator"> <span style="line-height: 1.3em;"> </span>
</div>
<div class="separator"><img src="/images/2015/05/28/wargent7.jpg" alt=""></div>
<div> </div>
<div>The chart above tells its own story, and there is little else but woe ahead for a number of mining town economies. </div>
<div> </div>
<div>The ongoing capitulation of house prices in the Pilbara and Moranbah have been well enough documented, but there are many more echo-corrections in the post across regions which have been propped up through the once-in-a-century mining construction boom. </div>
<div>
<br>My chart packs have shown here previously that the pipeline for mining capital expenditure is desperately weak, and there will be further data to report on expected capital expenditure declines later this morning.<br><br>Capex related to Ichthys still has a way to run, granted, while Adani is hoping to proceed with its $10 billion thermal coal project (despite the minor inconvenience issue that at today's prices the project can barely be viable).<br><br>But these monster projects aside, weakening commodity prices will ensure that mining investment is heading all the way back down where whence it came, which is why we call it a commodity <em>cycle</em>.</div>
<p><strong><span style="text-decoration: underline;">The wrap</span></strong></p>
<div>This negative result will breathe very life into the GDP result for the first quarter, while a further decline in Australia's terms of trade will also act as a drag.</div>
<div> </div>
<div>Economic growth may not be stone dead flat in Q1, but it seems unlikely to be a great deal better than that, which could drag the annual result down to well below 2% over the first half of this calendar year.</div>
<div> </div>
<div>With inflation forecasts having been revised down and further macro-prudential tools now being deployed by lenders, futures markets see every chance that the next move in interest rates will be down again to below 2%.</div>
<div> </div>
<div>Perhaps the twist in the tail here is that macro-prudential tools on lending to property investors mean lower interest rates for longer?</div>
<div> </div>
<div>
<em><span>PETE WARGENT</span> is the co-founder of <a href="https://allenwargent.com/" target="_blank" rel="nofollow">AllenWargent</a> property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank" rel="nofollow">blogger</a>.</em><br><p><em>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.</em></p>
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Major renovations work continues to flatline: Pete Wargent

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<p><span>There were 2,727 homes taken to auction this week, up from 2,599 over the previous week. The preliminary clearance rate was recorded at 78.9%, down slightly from 79.1% last week, making it the tenth week in a row where the combined capital city clearance rate has been above the 77% mark. Although auction volumes were higher at the same time last year (3,072), the auction clearance rate was lower, at 66.4%.</span></p>
<p><span><img src="/images/2015/06/01/shana1.jpg" alt="" width="905" height="687"></span></p>
<p> </p>
<p><span>In </span><strong>Melbourne</strong><span>, Australia’s largest auction market, there were 1,221 auctions held across the city. Of the 1,053 results reported so far, the preliminary clearance rate is 78.3%. In comparison, last week, Melbourne recorded a final clearance rate of 82.1% across 1,162 auctions. One year ago, Melbourne’s clearance rate was recorded at 65.4% across 1,356 auctions. Across Melbourne’s sub-regions, the Inner region had the highest number of auctions this week (296), with a preliminary clearance rate of 73.8%, while the Outer East region of Melbourne had the strongest result, with 88.8% of reported auctions selling.</span></p>
<p><span> </span></p>
<p><span><img src="/images/2015/06/01/shana2.jpg" alt="" width="842" height="573"></span></p>
<p> </p>
<p><span>Across </span><strong>Sydney</strong><span>, 1,120 homes were taken to auction this week with a preliminary clearance rate of 86.5% across 882 reported results. Last week, 1,018 Sydney properties were taken to auction with a clearance rate of 86.2%. At the same time last year, Sydney’s auction clearance rate was 73.0% across 1,316 auctions. This week, across Sydney’s individual sub-regions, Baulkham Hills and Hawkesbury (94.7%), City and Inner South (92.5%), Inner West (92.3%) and Sutherland (91.2%) regions all recorded strong preliminary clearance rates.</span></p>
<p><span> </span></p>
<p><span><img src="/images/2015/06/01/20150531-Sydney.jpg" alt="" width="863" height="582"></span></p>
<p> </p>
<p><span>This week, </span><strong>Brisbane’s</strong><span> preliminary clearance rate was recorded at 52.1%, up from 46.2% last week and 42.5% at the same time last year. There were 209 Brisbane auctions this week, compared to 159 last week and 219 last year. The </span><strong>Gold</strong><strong>Coast’s</strong><span> preliminary clearance rate was 40.3% across 62 results this week.</span></p>
<p><span> </span></p>
<p><span><img src="/images/2015/06/01/20150531-Brisbane.jpg" alt="" width="869" height="585"></span></p>
<p> </p>
<p> <em><span>SHANA MILLER</span> is a research analyst at <a href="https://www.myrp.com.au/" target="_blank" rel="nofollow">RP Data</a>.</em></p>
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Combined capital clearance rate above 77%: Shana Miller

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<p>Tony Abbott is absolutely right. There’s something I never imagined I would ever say, but the Prime Minister is spot on with his comments this week about house prices. He said on Monday he thought rising house prices were a good thing.</p>
<p>He sought to make his comments as a home-owner at Forestville in the northern beaches area of Sydney, as well as the nation’s Prime Minister.</p>
<p>The Federal Government has got a lot wrong on real estate, with its pointless inquiries and its equally pointless targeting of foreign investors in a sabre-rattling attempt to be seen to be taking strong action.</p>
<p>But Abbott was right on the mark about house prices. It’s long overdue for someone in authority to make the point that for people who own homes, which means the vast majority of Australian households, rising property values are a good thing. </p>
<p>They’re also a good thing for the nation.</p>
<p>For way too long, mainstream media has characterised any rise in house prices as a national crisis. It’s been the dominant tone in newspapers since the start of the century, which began with a genuine national property boom from 2001 to 2003, and it’s reached the point of absurdity more recently with coverage of the Claytons boom centred on Sydney.</p>
<p>Media has also lost all sense of balance with its treatment of the affordability issue. They’ve turned first-home buyers into a kind of protected species, to be fussed over to the exclusion of everyone else, including the seven out of 10 households who own their homes and want their values to rise.</p>
<p>Here’s what the Prime Minister said on Monday: “This government is trying to make housing more available, we’ve tried to make housing more affordable, and the best way to make housing more affordable is to keep interest rates low and stable and that’s exactly what’s happening and trying to make sure the economy is strong.</p>
<p>“As someone who, along with a bank, owns a house in Sydney I do hope that our housing prices are increasing. I do want housing to be affordable, but nevertheless I also want house prices to be modestly increasing."</p>
<p>That’s probably the only time in his reign that Abbott has spoken on behalf of most Australians.</p>
<p>Notwithstanding the misinformation that often describes our housing as the most expensive in the world - and the fuzzy logic that has turned the current up-cycle in Sydney into a national bubble - Australia continues to have one of the world’s highest home ownership rates. Most home-owners with mortgages are ahead on their repayments, while mortgage delinquencies are at record lows. These facts suggest a market that’s healthy and sustainable.<span style="line-height: 1.3em;"> </span></p>
<p>Most of us want property values to rise – and so does the nation. We’re all tasked with the challenge of providing for our retirement years amid a rapidly ageing population and a fragile Budget.<span style="line-height: 1.3em;"> </span></p>
<p>That demands that we invest and grow our assets. For many, the cornerstone of the process is the family home and its value.</p>
<p>So the Prime Minister leads the nation in wanting prices to rise across Australia. The problem is, they’re not.</p>
<p>The latest research figures suggest house values are going backwards in Darwin and Hobart, stagnating in Perth and rising only marginally in Canberra, Brisbane and Adelaide. Sydney, up 16%, has the only boom housing market.</p>
<p>Apartments markets are falling in Perth, Hobart, Canberra and Darwin, and there’s no meaningful growth in Brisbane or Adelaide. Melbourne is up only 3%. Even Sydney’s rise of 8.8% is quite moderate.</p>
<p>There’s nothing in those figures to support the notion of a bubble, nor the bleating of those who claim an affordability crisis, in contradiction of the situation described by the affordability indexes.</p>
<p>It says something about the state of journalism in Australia when the Prime Minister can generate a media storm by commenting that rising property values are a good thing.</p>
<p><em>TERRY RYDER is the founder of <a href="https://www.hotspotting.com.au/" target="_blank">hotspotting.com.au</a>. You can <a href="https://mailto:ryder@hotspotting.com.au" target="_blank">email him</a> or follow him on <a href="https://twitter.com/hotspotting" target="_blank">Twitter.</a></em></p>
<p>Terry is presenting a free webinar with Property Observer editor at large Jonathan Chancellor on Tuesday June 16 at 12.30pm titled on why research is the key to successful property investing in 2015. Sign up here.</p>
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Tony Abbott is absolutely right on house prices: Terry Ryder

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<p class="Normal"><span style="line-height: 1.3em;">Over the years I've refined the fittings and fixtures that we include in our villas. When we first started off many years ago, we'd just run with the basic builder's range.</span></p>
<p class="Normal">When I look back on the fittings in the basic builder's range I'm horrified. You see, the basic range is usually selected by the builder. The builder is very good at building homes but may not have a very strong sense of style. Large building companies will usually employ interior designers to make selections but if you are using a smaller building company, double check their fittings and fixtures.</p>
<p class="Normal">I remember on one build, after the timber mould out stage, (when the skirting boards, architraves and internal doors are hung) I arrived on site for my inspection. Walking into the villas I saw something bright and shiny in the corner of my eye. I turned to see gold hinges on the door. We'd chosen matt chrome door handles and I asked the builder about these brass hinges. His reply was "they are the best quality hinges you can get, Jo".  It didn't cross his mind that they didn't match in with the door handles. </p>
<p class="Normal">Some small changes to items like tapware can make a massive difference and not even cost any more. It's all in the style of tap. A builder's range tap may be functional but not necessary pretty. If you ask your builder who his plumbing supplier is, a quick visit to their showroom and I'm sure you'd find a nicer looking tap for the same price or a higher end range that may be on sale.</p>
<p class="Normal">The vanity is the focal point of a bathroom so look at what is available in the builder's range. Often you can add a coloured or timber look base to the vanity for no extra cost and tie in the colour with your tile scheme. A wall of feature tiles can really add impact, but make sure it's not overkill if it's a small bathroom.</p>
<p class="Normal">Lighting is another area that adds to the style of a room.  We try to avoid boring oyster lights. It's amazing how far the humble oyster light has come. Ask the electrician where he gets his lights and again take a look at what's available. Energy saving downlights give good light and are not that expensive and if you add two pendant lights over the kitchen then you will immediately give the kitchen a higher end feel. Add bulkheads above the overhead cupboards for a clean look. </p>
<p class="Normal">Ceiling fan with lights to the bedrooms are usually well received by tenants and buyers and not that much more.</p>
<p class="Normal">Don't forget the front door lighting, by adding a couple of stylish lights you're creating a good first impression.</p>
<p class="Normal">Look at a slight upgrade to the kitchen rangehood as this adds more dimension to your kitchen.</p>
<p class="Normal">I like to use a gloss floor tile in the living areas as it reflects light around the room and has a more luxurious feel.</p>
<p class="Normal">Finally, give the front façade something that will increase its appeal. Aluminium timber look garage doors are only slightly more than standard colours. Upgrade the front door handle to an oversized handle and combine it with a nice metal plate with the street number  to give a glamorous entrance.</p>
<p class="Normal"><em>Jo Chivers is Chief Executive Officer of property development project managers <a href="https://www.propertybloom.com.au/about" target="_blank">Property Bloom</a>.</em></p>
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