<a href="https://www.apartments.com.au/developers/urban-property-group">Urban Property Group</a> has revealed plans for a new mixed-use tower at 10 Dangar Street, Wickham, advancing a proposal that would reshape the southern gateway to Newcastle’s city centre with one of the city’s tallest residential buildings.

The State Significant Development proposal, now on exhibition, seeks approval for a <a href="https://www.apartments.com.au/new-apartments/bowline-10-dangar-street-wickham-nsw-2293">43-storey tower</a> immediately adjacent to the Newcastle Interchange. The project would deliver around 200 apartments, including 42 affordable housing dwellings, alongside 99 co-living units, a 171-room hotel, retail space, and new public domain integrated through the site.

The scheme marks a significant escalation of plans previously approved for the site. Urban Property Group took over the prominent 2,904 sqm parcel, where excavation and demolition had already commenced under an earlier consent for a 14-storey mixed-use development.

<img alt="First look: Urban Property Group unveils Newcastle’s next supertower at Wickham interchange" data-entity-type="file" data-entity-uuid="58a96dd9-407f-4d20-86b4-94e4bfeef74b" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/wickham%20podium.png?VersionId=LGlf08pdFGAZDzvx_CXC4XakHNZRuEE0" />

Designed by <a href="https://www.apartments.com.au/architects/sjb-architects">SJB</a>, the tower has been conceived as a landmark transit-oriented development anchored to the Newcastle Interchange precinct. The proposal includes 245 build-to-sell apartments across a mix of one, two, and three-bedroom residences, as well as two penthouses. Fifteen apartments and one operational unit are earmarked for NDIS housing. The co-living component would add a further 99 units, while the podium would accommodate retail uses and hotel facilities.

SJB said the site presents “a valuable opportunity to anchor the precinct by setting the standard for design, active ground planes and character at the key southern gateway.”

The architecture responds directly to the site’s position beside major transport infrastructure and within one of Newcastle’s fastest-evolving urban renewal precincts. The tower form sits above a sculpted podium designed to frame new public spaces, including a through-site pedestrian link connecting Station Street to Hannell Street, landscaped plazas, and activated retail edges.

<img alt="First look: Urban Property Group unveils Newcastle’s next supertower at Wickham interchange" data-entity-type="file" data-entity-uuid="a7bd6ff0-f7db-4ce8-a6dc-ea56e72c6149" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/wickham%20lanne.png?VersionId=xzf39VADyhj7zBQY2I9fx9vI62u2tuSb" />

The design report describes the project as part of the broader transition of Wickham into “a vibrant, high-quality mixed-use urban precinct” that leverages proximity to the station, open space, and regional connectivity.

A detailed public art strategy has also been prepared for the development. The strategy positions the project as “a transit-oriented development of state significance at the gateway to Newcastle’s city centre” and outlines a series of integrated artworks responding to Newcastle’s industrial and transport heritage.

Creative Road’s curatorial framework for the project, titled Unveil, draws on “stratified surfaces, carved volumes, and light-filled apertures” while referencing Newcastle’s transformation from an industrial city into a contemporary education and technology hub.

<img alt="First look: Urban Property Group unveils Newcastle’s next supertower at Wickham interchange" data-entity-type="file" data-entity-uuid="77a882bb-14b1-4d28-99ff-9438e39508c0" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/wickham%20site.png?VersionId=cevgo_vN0eKPK78P8YcEu3mKPLkpFqE7" />

The proposal is being advanced through the NSW Housing Delivery Authority pathway after being declared State Significant Development in June 2025. The accompanying scoping report states the development aims to “maximise the site’s proximity to the Newcastle Interchange by delivering transit-oriented development” while increasing housing supply and affordable housing provision within the Newcastle LGA.

Urban Property Group’s plans align with the long-term strategic vision established under the Wickham Master Plan, which identified the interchange precinct as suitable for substantial uplift in height and density. The current proposal would significantly intensify that vision, positioning the tower among the tallest developments proposed for Newcastle.

The site sits immediately north of the Newcastle Interchange, bounded by Dangar Street, Hannell Street, and Charles Street. It is surrounded by a rapidly growing cluster of residential towers and mixed-use projects that have emerged following the completion of the light rail and transport interchange.

Joel Robinson

First look: Urban Property Group unveils Newcastle’s latest tower at Wickham interchange

Bottega House has completed settlement of a landmark riverfront site in Macquarie Street, St Lucia, representing its first major Brisbane development.&nbsp;

Positioned on the banks of the Brisbane River, the <a href="https://www.apartments.com.au/new-apartments/180-macquarie-street-st-lucia-qld-4067">premium site at 180 Macquarie Street</a> features uninterrupted river frontage in one of Brisbane’s most tightly held residential precincts.&nbsp;

The proposed development, currently under assessment with Brisbane City Council, has been designed by <a href="https://www.apartments.com.au/architects/plus-studio">Plus Studio</a> with interiors by <a href="https://www.apartments.com.au/interior-designers/mim-design">Mim Design</a> and will deliver a boutique collection of premium residences positioned specifically for owner occupiers and downsizers.&nbsp;

The residences are set to redefine luxury apartment living in the area, with a focus on architectural quality, refined finishes, landscape integration and elevated amenities including curated wellness facilities, resort-style pools and recreation spaces rarely seen in the local market.&nbsp;

Exclusive sales for the project will be led by Keenan &amp; Byrne, ahead of an anticipated launch later this year.&nbsp;

Bottega House Managing Director Nick Malloch said the project reflects the group’s ambition to deliver a highly curated residential offering within one of Brisbane’s most tightly held precincts.&nbsp;

“This is an incredibly rare riverfront opportunity and one we have approached with a long-term perspective,” Malloch said.&nbsp;

“Our vision from the outset was to create a boutique collection of residences that feel more like private homes than traditional apartments, with generous proportions, refined finishes and exceptional amenity throughout."

Malloch says there is a&nbsp;lack of premium owner-occupier stock of this quality in the market, particularly for downsizers wanting space, privacy and a true lifestyle offering without compromise.&nbsp;

"Demand is expected to be strong given the scarcity of premium riverfront opportunities of this nature within Brisbane’s inner-west."&nbsp;

Bottega House secures landmark riverfront site in St Lucia 

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The arrival of the first piling rig officially marks the commencement of construction at SIERA’s new beachside apartment development, Exhale, in Northcliffe.

<a href="https://www.apartments.com.au/new-apartments/exhale-surfers-paradise-8-enderley-avenue-surfers-paradise-qld-4217">Exhale</a>, a glass-encased tower featuring 54 large-scale apartments at 8 Enderley Avenue, is SIERA’s third Gold Coast development. It follows the recently completed PIPIS Bilinga beachfront project, which achieved suburb-record prices, and the soon-to-be-completed Chevron Island development, Tapestry.

[smartcode_project:default project_id=112661 project_image_fid=359603]

<a href="https://www.apartments.com.au/developers/siera">SIERA</a> Founder and Managing Director Brent Thompson said the arrival of the piling rig represented a significant milestone for the development, which is scheduled for completion in late 2028.

Over the next month, around 260 piles are expected to be installed as work progresses on the basement structure. The building is anticipated to rise above ground level early next year, before unveiling its sculptural glass curtain wall, developed in collaboration with specialist façade engineers.

“The façade was designed to maximise panoramic coastal views while creating a distinctive architectural identity,” Thompson said.

[smartcode_project:default project_id=112661 project_image_fid=355935]

Designed by BDA Architecture, Exhale will comprise just 54 two- and three-bedroom residences across 26 levels, a level of low-density living rarely delivered in this beachside pocket between Surfers Paradise and Broadbeach.

The project has been conceived as a resident-only building, with no short-stay accommodation permitted. SIERA says the model is intended to appeal to long-term owner-occupiers rather than transient holiday demand.

[smartcode_project:default project_id=112661 project_image_fid=361052]

Residences have been designed with large-format layouts and expansive glazing, with most apartments featuring more than 30 metres of glass frontage to maximise natural light and ocean views.

The amenity offering spans two levels and centres on wellness and lifestyle, including a heated magnesium pool, sauna, yoga and Pilates studio, gymnasium, private dining facilities, cinema lounge, and dedicated surfcraft storage.

[smartcode_project:default project_id=112661 project_image_fid=359607]

More than half of the apartments have already sold. SIERA has also opened a sales gallery for Exhale at its Chevron Island commercial premises, near its Tapestry tower and the site of its second Chevron Island apartment development, which is slated to launch in early 2027.
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</section>

[smartcode_project_cta:default project_id=112661]

SIERA kicks off construction at Northcliffe tower Exhale

Local Little Bay residents, along with buyers from premium postcodes across Sydney’s affluent Eastern Suburbs, have dominated purchases in developer-builder Urban Property Group’s first Eastern Suburbs apartment development, <a href="https://www.apartments.com.au/new-apartments/este-little-bay-jennifer-street-little-bay-nsw-2036">ESTE Little Bay</a>.

The $250 million coastal project, one of the first new developments in the area in several years, has proven particularly popular with downsizers, especially those from Coogee and Bondi. One Double Bay downsizer paid $4.7 million for a four-bedroom penthouse, setting a new local apartment price record in the process.

Buyers have been attracted to the combination of coastal tranquillity, premium design and amenity-rich neighbourhood living. The walkable village setting, along with proximity to three of Sydney’s leading golf courses, New South Wales Golf Club, St Michael’s Golf Club and The Coast Golf Club, has also been a key drawcard.

[smartcode_project:default project_id=112343 project_image_fid=352689]

Built across two low-rise buildings designed by <a href="https://www.apartments.com.au/architects/hill-thalis-architecture-urban-projects-pty-ltd">Hill Thalis</a> and set along a lush, landscaped green spine, designed by leading landscape architect <a href="https://www.apartments.com.au/landscape-architect/arcadia-landscape-architecture">Arcadia</a>, ESTE Little Bay offers a collection of one, two, three and four-bedroom residences with interiors by Richards Stanisich.

<a href="https://www.apartments.com.au/developers/urban-property-group">Urban Property Group</a> Sales Director, Tom McIvor said the response to ESTE has been "nothing short of extraordinary."

“Buyers have been quick to recognise ESTE as a rare opportunity to invest in a coastal sanctuary that offers both seclusion and connectivity to the heart of Sydney,” McIvor said.

[smartcode_project:default project_id=112343 project_image_fid=352687]

<a href="https://www.apartments.com.au/project-marketer/srm-residential">SRM Residential</a> Senior Director, <a href="https://www.apartments.com.au/project-marketer/srm-residential">Clayton Ross</a> said the local market has responded incredibly well, driven by ESTE’s exceptional location and the rarity it offers.

“We’ve seen strong interest from a variety of buyer groups, all of whom are drawn to the exclusivity and quality of the build and construction by the 4.5-star iCIRT-rated builder / developer, Urban Property Group. There’s truly nothing else like it along Sydney’s coastline.”

[smartcode_project:default project_id=112343 project_image_fid=352690]

The project also includes robust buyer protections, including Resilience Insurance’s Latent Defects Insurance, providing 10 years of structural cover, and an independent iCIRT-rating of the developer.

“The iCIRT-rating adds another layer of confidence,” Ross added. “Buyers see it as a safeguard for their investment and their lifestyle.” A highlight of ESTE’s offering is its exclusive wellness amenities, including a heated rooftop infinity pool and outdoor heated spa, a state-of-the-art Technogym fitness centre, and a sauna.

<a href="https://www.apartments.com.au/new-apartments/este-little-bay-jennifer-street-little-bay-nsw-2036">ESTE Little Bay</a> is topped out and is on track to complete towards the end of 2026, with residents moving in before Christmas.

[smartcode_project_cta:default project_id=112343]

Eastern Suburbs buyers snap up ESTE Little Bay apartments

<a href="https://www.apartments.com.au/developers/sunland-group">Sunland Group</a> has officially lodged plans for its first Gold Coast apartment project since the departure of the Abedian family from the company three years ago, unveiling a new high-rise proposal for a prominent Broadbeach corner site on Old Burleigh Road.

The application was submitted by an entity directed by Tom Jamieson, stepson of longtime Sunland leader Soheil Abedian, and Riaz Rezvanipour, brother-in-law of Sahba Abedian, Soheil’s son.

Sunland acquired the 1,283 sqm site on the corner of Old Burleigh Road and Armrick Avenue for $9.5 million late last year and is now seeking approval for a <a href="https://www.apartments.com.au/new-apartments/99-101-old-burleigh-road-broadbeach-qld-4218">42-storey tower with 81 apartments</a>.

<img alt="First look: Sunland Group returns to Broadbeach with new Old Burleigh Road tower plans" data-entity-type="file" data-entity-uuid="fea2946d-90ee-4cfc-babe-2a8ad5db2cb6" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/pers.png?VersionId=BV0fihJw31nDIQ8ozY_h3GbS8mxDyhnm" />

Designed by <a href="https://www.apartments.com.au/architects/contreras-earl-architecture">Contreras Earl Architecture</a>, the proposed tower at 99-101 Old Burleigh Road would deliver a predominantly larger-format apartment mix aimed at the owner-occupier market. Plans include 17 two-bedroom apartments, 55 three-bedroom apartments, and nine four-bedroom residences across 35 residential levels.

The development also incorporates three basement levels, four podium parking levels, two levels of communal recreation facilities, and rooftop plant and equipment. A total of 189 car spaces are proposed, significantly exceeding the 90 spaces required under the planning scheme.

The architecture adopts a sculpted, curvilinear form, with deep wraparound balconies and integrated landscaping intended to soften the tower’s vertical expression. The planning report states the building’s “slender footprint/form provides a complimentary yet varied built form within the local streetscape” and contributes to “a varied, yet ordered skyline.”

Contreras Earl noted in its Architectural Statement that from the early stages, the project addressed a fundamental challenge: how to accommodate the required residential yield while avoiding the conventional model of a tower sitting on a rigid, fully resolved parking podium.

“The most direct response would have been to consolidate parking into a singular, flat podium and extrude a repetitive tower above,” the statement said. “While efficient, this approach would result in a consolidated built form with limited engagement with the surrounding landscape and public realm.”

Instead, the conventional podium model was “deliberately rejected”. The architects described the base of the building as “a landscaped architectural condition where structure, planting and circulation are integrated”.

“Rather than presenting a continuous built mass, the base of the building is articulated through a series of concrete planter elements that organise the podium into a fragmented system,” the statement said. “This approach reduces the perceived bulk of the lower levels while establishing a more permeable interface with the streetscape and adjacent open space.”

<img alt="Sunland" data-entity-type="file" data-entity-uuid="923fad8d-c960-4527-8fbe-975cf1ddf88d" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-25%20at%2010.32.03%E2%80%AFAM.png?VersionId=pngwb0hYOIUpq9vDw6F2EsOiVuHF3DiX" />

&nbsp;

The site sits within the High Density Residential Zone and inside the City of Gold Coast’s unrestricted “HX” building height area, where the planning framework anticipates intensified residential development tied to the expanding light rail corridor. The planning report notes the area is undergoing “transition toward more intense development forms” given its proximity to Broadbeach, Surfers Paradise, and high-frequency public transport infrastructure.

Positioned directly opposite Broadbeach Park and within walking distance of Florida Gardens light rail station, the development would sit among a rapidly evolving stretch of Old Burleigh Road that has become one of the Gold Coast’s most active apartment development corridors.

The application joins a growing pipeline of luxury residential projects reshaping Broadbeach, including nearby developments by 5Point Projects, Polycell, and Graya.

The planning report argues the project contributes toward the Gold Coast’s long-term housing targets under the South East Queensland Regional Plan, which forecasts the need for more than 100,000 additional high-rise dwellings across the city by 2046.

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The Abedian family departed Sunland Group in late 2023, ending a four-decade association with the company, and subsequently established the private development firm Abedian &amp; Co. The group is currently delivering <a href="https://www.apartments.com.au/new-apartments/greenmount-residences-cnr-hill-street-and-marine-parade-coolangatta-qld-4225">Greenmount Residences</a> at Rainbow Bay and recently launched <a href="https://www.apartments.com.au/new-apartments/18-mary-avenue-14-18-mary-avenue-broadbeach-qld-4218">18 Mary Avenue</a> in Broadbeach.
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First look: Sunland Group returns to Broadbeach new apartment market with new Old Burleigh Road tower plans

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

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

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One of the last remaining significant development opportunities in Melbourne's south-eastern industrial precinct of Pakenham has hit the market. 
The 2.183 hectare land holding, on three certificates of title, is expected to generate strong buyer interest from owner-occupiers and developers.  
The <a href="https://www.realcommercial.com.au/property-land+development-vic-pakenham-501058827" target="_blank">77-79 Bald Hill Road</a> property goes under the auctioneer's hammer on April 10. 
Colliers International’s Justin Fried and Gordon Code, in conjunction with Tony Miller of Ray White Pakenham, have been appointed selling agents. 
“Opportunities of this scale with this level of exposure in the Pakenham area are becoming increasingly rare, and this is one of the last remaining significant development opportunities on Bald Hill Road”, said Mr Fried. 
“In addition to an exciting development opportunity, this property will also appeal to a wide range of occupiers including trade/wholesale users (STNC) and warehousing/distribution businesses,” added Mr Code.
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kjiminez-eaYKfU7qd2

Significant Pakenham industrial development opportunity hits the market

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A refurbished freehold hotel at Nambour in the tightly held Sunshine Coast region has been offered for sale. 
Known as The Commercial Hotel, the three-storey property includes a two level accommodation annexe and a drive through bottle shop which is all situated on a site area of about 1,419 square metres.  Leon Alaban and Tony Bargwanna of Ray White Hotels Australia are marketing the <a href="https://www.realcommercial.com.au/property-hotel+leisure-qld-nambour-501074031" target="_blank">35 Currie Street</a> hotel. 
It was extensively refurbished in 2007 and generated an annual turnover (exclusive of gaming revenue) of more than $6.5 million in the 2012-13 financial year. 
Mr Alaban said the property was a rare chance to secure a freehold hotel within the tightly held Sunshine Coast hinterland. 
Facilities in the hotel, he said, included a public/sports bar, dining area, alfresco dining/beer garden, function room, kitchen, drive through bottle shop, three detached bottle shops and accommodation areas.
“The hotel’s gaming room has 30 electronic gaming machines however there is an approval to operate up to 37 EGMs,” he said.
The hotel comprises of 12 hotels rooms all with en suites.
The bottle shop is independent of any liquor purchasing group. It also includes three detached bottle shops in Nambour, all within 8 kilometres of the hotel, said Mr Bargwanna. 
The tender campaign closes on April 16. 
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Refurbished freehold hotel on the Sunshine Coast offered for sale

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A cropping property in one of Australia's oldest wine regions, the Barossa Valley, has been listed for sale.
Located adjacent to the township of Shea-Oak Log, about 60 kilometres north-east of Adelaide, the aggregation comprises five separate titles totalling 249.48 hectares. The property is described as “highly productive land" and "suited to continuous cropping and minimum tillage practices”.
The vendor is the Brooks family and the properties are being <a href="https://www.realestate.com.au/property-other-sa-shea+oak+log-7630363" target="_blank">offered in one line or separately by tender closing April 18</a>.
CBRE’s Phil Schell, who is marketing the property, said "the Barossa Valley region is typically tightly held, therefore, the offer of cropping land such as this is expected to attract strong interest from a wide range of parties including owner occupiers and investors.”
“The current share-farming agreement that is in place for the 2014 season is testament to the aggregation’s future security as a profitable cropping operation.”  
The property features main road access to all titles, benefits from extensive water supply to all paddocks, and is supported by annual rainfall of about 520 millimeters. 
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Barossa Valley cropping property listed

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An influx of international retailers over the past 12 has been unable to curb the rising retail vacancy in Melbourne's CBD, with vacancies touching a seven year high last month. 
Knight Frank’s latest CBD retail survey found that the vacancy rate reached 3.9% in February  - the highest since 2007. That compares to the long-term average of 2.9% and is up on last year's 2.6%.
Shopping centre vacancies recorded the biggest jump up from 1% to 4.1%, while street front shops rose from 3.9% to 4.4%.
The bright spot in the results was prime retail vacancy levels in Bourke and Collins Streets, which narrowed from 5.4% to 4%. 
Despite the weaker numbers, Knight Frank retail leasing director, Gary Loo, suggests that the rise in international retailers seeking to enter the market should help bolster the take-up rate, as well as attracting other retail users.
“Well-known international brands such as Zara from Spain and Thomas Pink and Forever New from the UK have taken the lead in their entry in to the CBD while Uniqlo from Japan and H&amp;M are anticipating their flagship stores to start-up during the first half of 2014," he said. "Further, international fashion label Topshop UK is expected to make their first CBD entry while Max Mara will also expand its footprint in the Melbourne’s CBD sometime in 2014."
He also points to other big name international retailers such as Marks &amp; Spencer, Apple and Forever 21 as currently scouting prime CBD sites for store locations.
Going forward, strong competition from international retailers eyeing a slice of the Australian retail market was expected to cast a windfall on the occupancy levels, he said.   
Knight Frank research analyst, Monica Mondkar, added that many of Melbourne’s CBD arcades recorded a near to zero vacancy, thus retaining their popularity amongst boutique fashion retailers and food &amp; beverage outlets boosted by the large number of visitors and residents year after year.
But she noted that the combined vacancy rate of laneways and arcades modestly climbed to 2.3% in February, slightly up on the long-term average of 2.2% and from 2% in June 2013.
Equally significant in the findings was the overall churn factor, which almost doubled since June last year to 11.9%. Restaurants and cafes, fashion clothing and other goods retailing were the top churning categories.
Shopping centres had the highest churn factor of 17.1%, the report said, as more landlords took the opportunity of soft retail conditions to refurbish in order to compete with limited retail trade growth over the past two years.
One trend to emerge from the challenging and competitive environment, said Ms Mondkar was the "repositioning of centres by aggregating previous vacancies into large discount department stores in order to uplift their occupancy levels".
Examples include Japan’s discount department store Daiso, which has recently taken up over 1,000 square metres of retail space at QV, as well as the leasing of GPO to H&amp;M, as a single occupant.
Figures from the research showed that prime CBD retail rents currently range between $2,500 and $6,000 a square metre, while secondary rents range from $800 to $1,800 per square metre.
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Melbourne CBD vacancies hit seven-year high

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Name: Edward Bull<img src="/images/2014/03/25/edward-bull-profile.jpg" alt="" style="float: right;">
Position: Queensland director
Company: CBRE
Office location: Brisbane
How long have you been in the industry?
It will be 11 years this year.
What’s happening in the area you specialise in?
Industrial is experiencing a strong resurgence and is a very popular asset class amongst the institutions, right down to mum and dad SMSFs. We are seeing yields tighten as a result of the lack of stock available and the influx of capital. With the low interest rate environment, we expect this to be the case for the short to medium term.
Describe the most interesting property you have sold?
Industrial is not often referred to as interesting, so will have to go with the biggest and most challenging which was a pre-sale and fund through for Toll Property in Brisbane for $84.5 million. From start to finish, it will have been an 18 month process.
What are the ingredients to being successful in your job?
Product knowledge and the ability to pick up the phone and build rapport and trust with someone you may not have met before. Strong work ethic, because I believe you get out what you put in but sometimes you have to persevere in difficult times and you need to be able to pick yourself up and go again when things don’t go your way.
What aspects of your role do you enjoy the most?
The camaraderie of working with a great team and culture at CBRE and also the satisfaction of completing a deal no matter how big or small.
Where would you invest a spare $750,000?
A mix of REITs focussed on industrial, and also direct industrial property through some of the more active reputable syndications.
Which football team do you support?
The Sydney City Roosters – go the chookies!
What’s your favourite app or techno gadget?
What’s an app? 
How do you use social media?
I am active on <a href="https://www.propertyobserver.com.au/https://au.linkedin.com/pub/edward-bull/1b/116/443" target="_blank">Linkedin</a> and find it a good way to create brand awareness.
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In profile: CBRE's Queensland director, Edward Bull

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GUEST OBSERVATION
Property is a critical element in the construction of any diversified investment portfolio. With characteristics such as relative capital stability, generally higher income and, by the real nature of the asset, a hedge against inflation, property can balance out the volatility experienced through equities and other riskier assets.
When retail and SMSF investors think of property however, their minds immediately turn to residential property, after all this is the asset class they are most familiar with. By not broadening their investment horizon they may run the real risk of generating too much concentration to residential property, exposing themselves to the very risks they were trying to diversify away from.
With an investment in property still an important part of an investment portfolio, investors who wish to include property exposure would do well to consider commercial property.
Investors often dismiss commercial property, believing it isn’t suitable for retail or SMSF investors because of the size of investment required, the possible lack of liquidity and the difficulties in managing a commercial property. But these concerns may be overcome by taking advantage of pooled investment vehicles, such as listed and unlisted property trusts.
Investing into a pooled property trust provides access to experienced, professional property fund managers, is no different to an equities fund. Other benefits of investing in commercial property through a managed fund include obtaining diversity of asset type and geography, a regular valuation cycle, smaller capital requirement for buy-in, greater liquidity through withdrawal facilities and a stable income from a diversified tenancy base.
<blockquote>
With an investment in property still an important part of an investment portfolio, investors who wish to include property exposure would do well to consider commercial property.
</blockquote>
Unlisted property funds are not subject to the share market volatility that listed funds have experienced in recent years. Instead, they exhibit performance that is in line with the underlying investment properties – which is ideally what those investors looking to property for its diversification and performance benefits are seeking.
Unlisted non-residential property in Australia, in particular, has consistently achieved investment yields of around seven percent over the past two years, providing stable and regular returns for investors. This has been at a time when other asset classes have faced headwinds such as falling interest rates and weakness in the share market.
In addition, investors can also gain exposure to individual sectors of the Australian economy through unlisted property trusts, with healthcare property a prime example. The healthcare property sector has been less volatile than other commercial property sectors over the past few years, and has outperformed all property on a one, three and five year basis, driven primarily by strong income returns.
The reason for this is that healthcare properties are relatively scarce, operate in a regulated industry and are typically leased to large, stable and well-resourced operators. The ageing Australian population and increasing need for healthcare services helps ensure high occupancy levels w to higher income yields.
The options for property investment, for retail investors and SMSF trustees alike, are greater than simply looking to residential property. By ignoring a large segment of the property market, and staying with the familiar, investors not only run the risk of investing in residential property at the top of the market, they risk losing the benefits that come from investment in a professionally managed unlisted property trust.
Ryan Banting is head of portfolio management with <a href="https://www.australianunity.com.au/" target="_blank">Australian Unity</a> Real Estate Investment<a href="https://www.australianunity.com.au/" target="_blank"></a>.
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jake-cSmGT7VXVf

Investors overlook commercial property at their peril

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GUEST OBSERVATION
It is true that the main culprits for housing prices in Australia are taxation and regulation regimes, as <a href="https://www.theage.com.au/comment/dont-blame-foreigners-for-rising-house-prices-20140319-352nn" target="_blank">argued</a> by Stephen Kirchner last week. But this is more because of their impact on demand than supply.
Generous incentives including negative gearing and concessions on capital gains tax encourage investment in housing, to the extent that around one in seven Australian taxpayers now owns one or more investment properties.
As there is no limit to how many properties local investors can negatively gear, and with share markets volatile, investment properties are looking increasingly attractive. Australia already has one of the highest levels of household debt in the OECD due to borrowings for property purchases, and this is growing fast.
Overseas investors are adding to that demand. The Foreign Investment Review Board enables global investors to buy new housing in Australia. Along with Canada, Australia has emerged from the 2008 global financial crisis as a stable economy and good investment prospect, with one of the strongest property markets in the world.
Infinite demand
The upshot is that local and global investor markets are combining to create what is essentially an infinite level of demand. Intense competition at sale is a major contributor to Australia’s declining housing affordability.
The rationale for new high-rise housing in the inner city is that an increase in supply will eventually meet demand. It follows then that as demand is satisfied, prices will come down and affordability will increase. In addition, this form of housing is supposed to be the most environmentally sustainable. On all three counts, unfortunately, the rationale is not borne out.
It is true, however, that the high-density, high-rise, high-security housing currently being built in the inner city is the preferred form and location for both local and global investment markets.
Australian governments need to come to terms with the prospect that no amount of increase in housing supply will meet demand if there is no limit to that demand. The relation is complicated further by the fact that investment properties are often left vacant.
There is no reliable source of data on whether the more than 20,000 high-rise apartments built in inner-Melbourne in the last decade are owner-occupied, rented or vacant, but unofficial estimates from the City of Melbourne indicate that up to 90% are owned by investors and that a large number are unoccupied.
As Kirchner observes, this is a rational response when prospective capital gains provide sufficient return on the investment. As local investors can negatively gear a property with only a few weeks of rental income, and as global investors have their eyes on the capital return on sale, keeping the apartment empty for most of the year can be preferable to dealing with tenants and real estate agents.
Lessons from Canada
Recent experience in Canadian cities is similar. Multiple clusters of 30 to 50 storey condominium towers have sprung up in Vancouver’s downtown and major centres, and the rate of construction is showing no sign of slowing.
Last year the BC Globe and Mail ran a <a href="https://www.theglobeandmail.com/life/home-and-garden/real-estate/at-vancouvers-cold-harbour-a-neighbourhood-hollows-out/article11713598/">story</a> about the closure of a two-year-old store called Green Design in Coal Harbour. The proprietors’ dream of supplying all those condo balconies in need of greening with space-saving wall planters, herbs and pot plants had come to naught, they said, because “a hefty share” of the condos were empty most of the year round.
There are two main classes of owners, the proprietors said: overseas investors, and American and Canadian holiday-condo owners, none of whom are there for more than a couple of months a year. The City of Vancouver estimates that at least 25% of new condos are owned by non-resident investors from less stable economies looking to park their wealth in a safe environment. The Green Design proprietors say these apartments are permanently empty. When the holiday-condos are included, many buildings are more than half empty.
And affordability loses again
It is clear that in both Melbourne and Vancouver the dramatic increase in housing supply is not only not meeting demand, but not increasing affordability. There is simply no evidence, after more than a decade of high-rise apartment construction in both cities, that housing prices have moderated even in the most relative of terms.
No amount of flash inner-city apartments will bring the price of housing down in the suburbs and on the fringe. In both Melbourne and Vancouver, the greatest housing need is for low- to medium-income housing. Even if the new inner-city apartments were available for rent, this is not the market for which they are built.
Finally, there’s the ecological <a href="https://onlinelibrary.wiley.com/doi/10.1111/j.1745-5871.2011.00728.x/abstract;jsessionid=B2F80ACCF51792C994C99A085306B796.f02t04?deniedAccessCustomisedMessage=&amp;userIsAuthenticated=false" target="_blank">fallacy</a>: that high-density housing is the most environmentally sustainable form. A strong case has been made by a number of Australian <a href="https://www.publish.csiro.au/pid/6784.htm" target="_blank">researchers</a> that per capita levels of consumption are actually lower in medium-density housing than in inner-city residential towers. This is not taking into account the materials involved in high-rise construction, nor the local environmental and amenity impacts of the towers and their multi-storey car-parks.
International and local research shows that government visions for Melbourne and Vancouver are not meeting their basic policy objectives. High-density, high-rise, high-security and high-cost apartment towers are not meeting local housing demand. They are not increasing affordability. They are not more environmentally sustainable.
They are increasing housing supply, mainly for local and global elites to accumulate capital. A major consequence of the Australian government’s taxation and regulatory regimes regarding housing has been to increase prices by encouraging demand for housing as a commodity, rather than a place to live.
The various inquiries into the state of the Australian housing market should look at not just the regulations on foreign investment, but at the taxation regimes that encourage the home-grown approach.
Most importantly the inquiries should ask: what is the effect of Australian regulation and taxation regimes on what is being built, and for whom?
Kate Shaw is an Australian Research Council (ARC) Future Fellow in Urban Geography and Planning. Her current research focuses on urban renewal in the 21st Century.
This article was originally published on <a href="https://theconversation.com">The Conversation</a>. 
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kshaw-MqzDNssKtd

Housing blame game here to stay in world of infinite demand

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Former Olympian Micheal Wilson and his wife Mary are selling the <a href="https://www.realestate.com.au/property-viticulture-tas-legana-7608343" target="_blank">Vélo Wines vineyard</a> in Tasmania’s Tamar Valley.
<img src="/images/2014/03/25/image10.jpg" width="460" height="345">
According to RP Data, the 4.71 hectare property has been listed for 94 days thus far, hitting the market on December 18 last year. The winery sale includes the Barrel Room Café and Vélo Vineyards cellar door, which the property’s listing boasts is one of the busiest in the Tamar Valley. The property is listed with $1.25 million expectations.
The vineyard, overlooking the Tamar River, is situated along the Tamar Valley tourist route, 10 minutes’ drive from Launceston’s CBD. In addition to the winery’s 50 year old vines, the oldest cabernet vines in Tasmania, the property also includes 80 year old chestnut trees, olive and citrus trees and herb and vegetable beds.
<img src="/images/2014/03/25/image7.jpg" width="460" height="345">
Vélo is selling through John Hewitt of Landmark Harcourts Tasmania.
Wilson, a former Olympic cyclist, purchased Vélo with his wife in 2001. Presumably, the vineyard is so named for the French translation of the word “bicycle.” Wilson (pictured below at Vélo) competed in the 1980 Moscow Olympics.
<img src="/images/2014/03/25/image12.jpg" width="460" height="345">
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jrichardson-uRX5hFdKfN

Tamar Valley vineyard on the market with $1.25 million expectations

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GUEST OBSERVATION
The following comment echoes a dilemma of many potential first home buyers in Australia: 
“I am in late 20s, early 30s, $150,000 household income, $200,000 in savings - what should I do? Do I buy a property and risk my cash on an asset which is said to fall in value, or do I rent and invest my money into shares?”
The numbers may differ from person to person but the concern is the same.
I dealt with the issue of property prices in Australia and <a href="https://www.propertyobserver.com.au/residential/australian-property-prices-in-2014-and-beyond-a-peek-into-the-future/2014013167457" target="_blank">what will happen in the future</a>, so instead I would like to focus on the issue of confidence.
If we analyse Australia's current economic situation objectively, we have a <a href="https://www.propertyobserver.com.au/residential/a-roof-over-your-head-or-the-biggest-investment-you-ll-ever-make-how-should-we-treat-residential-property/2014020967655" target="_blank">six decades long history of strong growth in property prices</a>, historically low interest rates, a low unemployment level and an economic growth rate which is the envy of other developed nations. Also, it is relatively easier to finance property purchases nowadays than it was 20 years ago. In addition, there are ample examples of research demonstrating that residential property in Australia is <a href="https://www.asx.com.au/documents/resources/ASX_Report_2013.pdf" target="_blank">potentially the best investment class over the long-term</a>.
Yet, the fear of losing money, “because property prices are doomed to fall” and a pessimistic outlook are paralysing many to the extent that they are incapable of making a decision to buy a property.
Where does this fear come from? Why are we the biggest pessimists in the world despite surviving the global financial crisis quite well so far? We used to have severe recessions and other economic calamities before so, what’s different now? 
Let me digress for a moment and reflect on the “old times”, when things were viewed from another perspective.
How things used to be
Back then in the 1970s, 1980s or even 1990s, there was no talk about a possibility of property prices falling. The idea was to line up for a loan at the first opportunity and to get your first home as soon as you got your first full time job. It didn’t matter that the property had to be in a location on the city outskirts – you were buying what you could afford, and not your ultimate lifestyle.
The logic was that you pay your first property off as quickly as you can and then upgrade to something better and closer to city centre. Then do it again. And again. So that in the period of 15 to 20 years you could end up with something to enjoy for the rest of your life and which suited your lifestyle.
Your grandparents did it that way. Your parents did it that way. Everyone just followed the same routine. No questions asked. Everybody knew you cannot go wrong following this recipe.
I am generalising but it conveys the overall attitude of an older generation of Australians towards residential real estate. Now, let’s fast forward to present times.
How things are now
Parents and grandparents are no longer the role models and the primary source of wisdom. There is a new paradigm now.
Younger generations now take advice from media manufactured, faceless avatars and do-gooders on the Internet who create, either knowingly or unintentionally, the environment of fear, uncertainty and general misinformation.
This is not a criticism of a younger generation – quite the opposite. It is extremely difficult for anybody to make a decision with full confidence in such circumstances. The problem is more universal and relates to all generations living in present times. However, those of older age have those big decisions well and truly behind them while younger people have to face them now or in the near future.
The causes
It could be argued that it is the symptom of modern times that we are so overloaded with everyday tasks that are unable to find time to learn, discuss concepts and ideas with peers and elders we respect, analyse information and then make conscious decisions. Consequently, everything needs to be served on a plate for easy consumption where there is no need to exercise the brain too much.
As an example, we “do research” by skimming through news headlines and the more extreme and negative they are, the more attention they are likely to attract. We express our approval, opinions, or even protest, by clicking “Like”. And we tend to make only binary decisions: “Yes/No”, “Good/Bad”, etc. It seems there is very little time to ponder on “what if…” scenarios.
That is why media (traditional and social) and the internet in general have such a profound influence on what we think and do – they deliver snippets of information in chunks we are able to process without much effort.
The ease of dissemination of information in the digital age means there is a room for all sorts of views but what makes into a wider circulation is controversy and extreme cases.
So, we hear and read: “Property prices to fall 20%”, scratch that, 40% sounds more dramatic! But no one bothers to answer a fundamental question: "…and then what?"
Will they stay low or rebound? Is it likely that government would not intervene and would not try to prevent such a disaster? If there is intervention, what could be the impact on prices? Does this prediction have any merits after all?
It could be argued that there would be too much thinking involved to get these answers and in the fast paced digital media world there is no time for that because of editorial deadlines. The main game is headlines that attract the audience - not necessary the real story behind them.
And nobody bothers with putting caveats on such predictions either – by the following year the public will not remember “current scares” since focus will move onto the next extreme set of predictions.
A big part of the problem is how we interpret information published in the media – instead of treating those claims as a starting point for further investigation we tend to jump to a quick conclusion: “I saw it on TV so it must be right.”
<blockquote>
It is rather rare that a balanced and objective view of the state of affairs reaches wider audience via popular media channels – there is no incentive to publish such information simply because there is nothing sensational about it.
</blockquote>
Therefore, we are probably as much to blame for what is happening as the media. That is, we do not demand in-depth analysis behind the story simply because we don’t have the time to digest it. We just assume that someone must have done it diligently to come up with the conclusion, so the headlines will do just fine.
It is rather rare that a balanced and objective view of the state of affairs reaches wider audience via popular media channels – there is no incentive to publish such information simply because there is nothing sensational about it. Balanced views simply do not attract enough audience.
The effect is that only simplistic, negative, very often contentious, views propagate - leading to a widespread misinformation, like: “Property prices will fall in Australia because they have fallen everywhere else”; “We have affordability crisis because of negative gearing and speculators”; “Foreigners are causing property prices to rise”. There are a tonne of those around.
It should therefore come as no surprise that a significant proportion of would be buyers is put off making a decision.
Article continues on next page. Please click below.
<hr class="system-pagebreak">
Some unexpected consequences
There is a number of quite ironic consequences resulting from all that doom, gloom and misinformation about the property market in Australia.
Firstly, it makes us vulnerable to exploitation by unscrupulous spruikers. In particular, on one hand it all leads to a perception that “property ownership is a dumb idea” (whether for living in it or earning income from it), that “everybody is losing money” and “everything is going to collapse very shortly anyway”.
On the other, it creates a fertile ground for those who claim to have a “secret formula” to “make it all magically work for us” and “to make the taxman pay for everything” - if we only spend $10,000 on a seminar and instructional videos, and some more on personal coaching.
There are plenty of people who fall for a magic of big numbers and a prospect of becoming a property mogul - despite the fact that there are no secrets to making money with property, just clever marketing.
The second consequence is that it led to emergence of new industries with a sole purpose of helping people to buy into property – from online discussion forums, dedicated blogs and property search portals profiting from advertising, through those selling specialised reports, smartphone apps, DIY property investment books and seminars, to buyer advocates and mortgage brokers offering information, tools and services for a fee. And now even financial advisers are getting on-board with advice on investment in property via self-managed superannuation funds.
<blockquote>
The overload of information and assistance, rather than helping in making decisions, has a totally opposite consequence – that is, more information tends to paralyse us rather than aid in making those hard decisions.
</blockquote>
Yet, it seems that, for many, it is harder than ever to make a decision. The overload of information and assistance, rather than helping in making decisions, has a totally opposite consequence – that is, more information tends to paralyse us rather than aid in making those hard decisions.
Not to mention that everybody demands a fair compensation for their work so, that assistance can add quite substantially to the overall cost of buying, making us even more apprehensive about making the decision.
Not many of these services existed 20 odd years ago and information was not so easy accessible either. So, the bulk of advice and assistance was coming from parents, relatives and your local bank manager – all for free.
The trust that young people had in older generations is no longer as strong for the current generation of young people. Maybe this is also due to the fact that the elders also have become confused and no longer have as strong a conviction about the merits of purchasing a property as they used to have in the past.
This is unfortunate because that trust was crucial in providing moral and emotional support for young people getting into debt for the first time. And it helped to positively reinforce the decision.
The perception that nothing can go wrong because “everybody is doing it this way”, created by decades of success stories by people they knew personally, was also very empowering.
In other words, it appears that the whole support structure that helped in making tough decisions is significantly weakened, if not entirely collapsed. There is really nobody that can be trusted anymore since those who offer assistance are there only to gain something from us (i.e. either clicks, patronage or real money for a service). The notion of “impartial advice” is somehow compromised in those circumstances as one can never be certain of true intentions behind provided information and advice. We are really on our own with those big decisions.
Social considerations that cannot be ignored
Then there are also social pressures impacting on the decision whether to buy a property or not. In the 21st century fun, globetrotting, gadgets, extreme sports, celebrity status, etc. “symbols of good and joyful life” are valued much higher than debt on a property located somewhere on the city's outskirts. Committing to owning a property early in life would mean sacrifices (i.e. less of the fun things) and would undermine rather than enhance the status of individuals in the eyes of their peers. So, at young age the choice is easy – don’t buy.
By the time people are ready to settle and start a family (which happens much later in life than in the past) they have already got used to the convenience of living in the city but they are overwhelmed by the amount of money required to continue that lifestyle as a family unit (either renting or buying, which requires taking on a substantial debt). This is when the anxiety about the future really kicks in.
The fact that Australia has not really experience economic hardship since early 1990s means that many of younger people also do not know what to expect when the hard times do come, adding to the anxiety and multiplying the fear factor (ie. because of the unknown).
This is a point in life when headlines like “property prices are overvalued by 40%” or “there is housing affordability crisis in Australia” are becoming a drawcard for this demographic group because it helps them to cope with the anxiety by reinforcing the fact they are not alone in this predicament.
However, these are not the real reasons why they are unable to buy - it is all primarily about the mindset.
A simple solution
The reality is that things are never black and white as they are over-simplified by media for the purpose of easy consumption. What we mostly hear in the media are opinions and not indisputable facts based on evidence – even those expressed by experts.
So, this fear is not substantiated with a valid reason. It is just a consequence of not knowing what to believe in, as well as not having the adequate knowledge to objectively assess what others are purporting to be the “ultimate truth”.
The only way to overcome this paralysis it is to get to know the facts. And this requires making the effort of starting to think for yourself.
The bottom line is that one cannot outsource thinking because there is a big price to pay at a later date. 
End note
I did use many generalisations in this article to emphasise the important issues underpinning the problem but, of course, there are many exceptions, as current property sales statistics show. There are many first home buyers that are making the decision to buy right now.
It all boils down to a mental state of having a confidence in the decision you make. It requires knowledge and conviction that this knowledge is not tainted.
It takes effort and lots of thinking before you can get into that mental state. So, taking time to think should be as important as attending the gym or undertaking other routine activities of your daily life. Sorting out finances to buy a property is the easy part.
There are no right or wrong decisions. However, since there are consequences of each decision, there will be those decisions that one can live with and those that will be regretted until the end of one’s life.
The key is to be mentally prepared to bear those unpleasant consequences when you make a decision which produces an outcome that is not in your favour.
This is the only secret one really needs to know to make a decision whether to buy or not to buy a property at present time. Affordability has nothing to do with it - it is all about the confidence.
Arek Drozda is an independent analyst who has worked in the public and private sectors for over 20 years in business development, data analysis and in building geographic information systems.
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adrozda-Nq9GwoWWBW

Crisis of confidence or crisis of affordability?

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RP Data has released our latest Pain &amp; Gain Report for the December 2013 quarter. The report found that of those residential properties re-sold throughout the final quarter of 2013, 9.7% were sold for less than their previous purchase price compared to 31.8% of re-sold homes transacting for more than double their previous purchase price.
The proportion of loss making sales was down from 12.6% at the same time in 2012 and was at its lowest level since the three months to July 2011.
Across the combined capital cities the proportion of loss making re-sales was even lower. Over the quarter, just 6.5% of homes sold at a loss compared to 9.8% at the same time in 2012. The proportion of loss making re-sales was at its lowest level since the three months to May 2011.
Across each individual capital city, the proportion of homes selling at a loss is now trending lower. Given the consistently low mortgage rate environment and the rise in home values over the past year this is not an unexpected occurrence. With values rising and as we move beyond the financial crisis, the likelihood of homes re-selling at a loss is likely to continue to reduce throughout 2014.
<img class="aligncenter size-full wp-image-3020" src="https://blog.rpdata.com/wp-content/uploads/2014/03/chart-1.jpg" alt="chart 1" width="500" height="179">
A key feature of the analysis over recent years has been the consistently high proportion of loss making re-sales across some of the most high profile coastal markets.  Conversely, key regions linked to the resources sector have consistently recorded a relatively low proportion of loss making sales.  More recently conditions have started to change.
<img class="aligncenter size-full wp-image-3021" src="https://blog.rpdata.com/wp-content/uploads/2014/03/chart-2.jpg" alt="chart 2" width="500" height="179">
High profile coastal markets such as Richmond-Tweed in New South Wales, as well as Far North, Gold Coast and Sunshine Coast in Queensland and the South West region of Western Australia have generally seen a high proportion of loss making re-sales over recent years.  As the above chart highlights, the proportion of loss-making re-sales is now trending lower across each region.  At the end of the December 2013 quarter, 23.8% of re-sales in Richmond-Tweed were at a loss down from a peak of 29.1% over the three months to October 2012.  Across the Queensland regions, the proportion of loss making re-sales peaked at 41.7% in the Far North (Jun-12), 39.1% on the Gold Coast (Dec-12) and 35.7% on the Sunshine Coast (Dec-12).  At the end of last year, the proportion of loss-making re-sales were recorded at: 28.8% in the Far North, 26.9% on the Gold Coast and 25.8% on the Sunshine Coast.  South West Western Australia recorded a peak in loss making re-sales of 23.3% in May-12 and at the end of 2013 the proportion had fallen to 19.6%.
<img class="aligncenter size-full wp-image-3022" src="https://blog.rpdata.com/wp-content/uploads/2014/03/chart-3.jpg" alt="chart 3" width="500" height="179">
As the high profile coastal markets have started to show improving market conditions, resource areas have seen property values and demand begin to fall resulting in a lift in the proportion of loss making resales.  The above chart highlights the proportion of loss making re-sales over time across the major mining regions of Fitzroy and Mackay in Queensland and the Pilbara and South Eastern in Western Australia.  In Fitzroy, the proportion loss-making re-sales have risen from 9.5% at the end of 2012 to 19.5% at the end of 2013.  At the end of 2012, 10.4% of Mackay homes re-sold transacted at a loss compared to a much higher 23.6% at the end of the December 2013 quarter.  The Pilbara region recorded 13.3% of all re-sales at a loss over the final quarter of 2013 up from 2.0% a year earlier. 18.1% of re-sold homes in the South Eastern region transacted for less than their previous purchase price over the final three months of 2013, up from 11.8% over the same period in 2012.
The impact of the peak in mining investment on local housing markets is clearly the primary cause of the upswing in realised loss.  With demand for mine workers lower in the operation phase compared to the construction phase, local housing markets are often experiencing falling demand both from a rental and an ownership perspective.  As a result it is no surprise that a greater proportion of sellers are realising a loss on the sale of their home in these areas.
The analysis suggests that low mortgage rates are resulting in housing market conditions that are generally improving.  Across the country the proportion of loss making re-sales is trending lower as home values rise.  Coastal markets have seen a relatively high proportion of loss making re-sales and although, as a proportion, loss making sales remain high they are also trending lower.  This reflects the low levels of capital growth returning to these markets.  On the other hand the slowdown in mining investment is already having an impact on regions heavily linked to the resources sector.  The economies in these areas tend to not be overly diversified and it would be no surprise to see a further rise in the proportion of loss making re-sales in these areas throughout 2014.
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