High-profile apartment defect cases have changed the way many NSW buyers approach purchasing, putting greater scrutiny on building quality, strata records and the parties behind a development before a contract is signed.

The industry buyers are assessing today, however, is also different from the one in which cases such as Opal Tower and Mascot Towers emerged.

NSW has introduced a series of regulatory measures aimed at strengthening oversight of apartment construction, including Building Commission NSW, the Residential Apartment Buildings Act 2020 and the Strata Building Bond and Inspections Scheme. Under the latter, developers are required to lodge a bond, with independent inspections forming part of the process for identifying defects in new strata developments.

Those changes provide another layer of protection, but they haven't removed the importance of buyer due diligence.

[smartcode_project:default project_id=5743 project_image_fid=372394]

For purchasers considering an apartment, that means looking beyond the residence itself. Building and strata history, strata reports, the track record of the builder and developer, the condition of common property and any known or planned expenditure by the owners corporation can all form part of assessing a building before purchase.

Whether the development is already complete can also materially change what can be assessed.

An off-the-plan purchaser is necessarily buying before the finished product exists. A completed apartment, by comparison, can be walked through before contracts are signed, allowing the purchaser to see the finishes, common areas and broader building as they have actually been delivered rather than relying solely on plans and renders.

It also removes exposure to some of the uncertainties that exist between an off-the-plan purchase and completion, including construction delays, cost pressures and builder insolvency during the delivery period.

[smartcode_project:default project_id=5743 project_image_fid=927]

<a href="https://www.apartments.com.au/project-marketer/equitifund-group">Projects by Equitifund</a> National Sales Director Ben Hamblett said that greater focus on tangible evidence is increasingly evident among apartment purchasers.

“The biggest shift we're seeing is buyers wanting proof, not promises,” Hamblett said.

“That's exactly why we deal in completed stock - you can inspect the building before you commit - and why we've backed every purchase with a cash bond against special levies.”

At <a href="https://www.apartments.com.au/buildings/the-lennox-parramatta-12-phillip-street-parramatta-nsw-2150">The Lennox</a> in Parramatta, that emphasis on a completed, inspectable product is already in place.

The 413-apartment, 46-level tower at 12 Phillip Street is being marketed by Projects by Equitifund, allowing prospective purchasers to inspect the residences, common areas and resident facilities before committing.

[smartcode_project:default project_id=5743 project_image_fid=375255]

The Lennox also introduces another layer to the due-diligence conversation through Strata Surety.

The vendor-funded arrangement provides purchasers with a cash-backed bond held in their own solicitor's trust account from settlement. According to Equitifund, the bond covers any special levy raised during the applicable cover period and is provided at no cost to the purchaser.

Special levies can create an unexpected cost for apartment owners where an owners corporation needs funding beyond its existing strata contributions. Under NSW strata law, a special levy requires approval by owners at a general meeting.

Equitifund Executive Chairman Greg Huxley said Strata Surety was designed to provide something more concrete than reassurance about that potential exposure.

“Buyers have every right to ask hard questions about strata risk - the industry has given them plenty of reasons to,” Huxley said.

“Our answer isn't a reassurance, it's a bond. Strata Surety puts real money behind that confidence, held by the buyer's own solicitor, not by us.”

[smartcode_project:default project_id=5743 project_image_fid=375281]

For The Lennox, its completed status also means purchasers can assess not only the apartment itself, but a building that has already been occupied and operating for several years.

Completed in 2021, the $300 million development, designed by <a href="https://www.apartments.com.au/architects/marchese-partners">Marchese Partners</a>, comprises one, two, three and four-bedroom apartments, with open-plan living areas extending to private balconies. Interiors incorporate engineered timber flooring, stone benchtops and integrated appliances, while many upper-level residences have views across the river and surrounding district.

Its established amenity can similarly be inspected in operation. Resident facilities include the Watermark precinct with a 20-metre pool, outdoor terrace, barbecue areas, gym, fitness studio and conference room, while ground-floor retail addresses the river walk and surrounding public space.

The Lennox is also home to the Southern Hemisphere's first fully robotic residential car park, which has now operated for several years. Its nine-level basement combines three conventional parking levels with six automated levels, accommodating 327 vehicles using technology from German firm Lödige Industries.

[smartcode_project:default project_id=5743 project_image_fid=925]

The riverfront address puts The Lennox close to much of central <a href="https://www.apartments.com.au/developments/parramatta-nsw-2150">Parramatta</a>'s existing infrastructure, including Parramatta Station, Westfield Parramatta, Parramatta Park, and the Church Street dining precinct.

The remaining apartments form part of a limited release secured by Equitifund, following the sale of the majority of residences before and shortly after completion.

The regulatory environment around NSW apartment construction has changed considerably since the defect cases that reshaped public discussion around the sector. For purchasers, however, regulation is only one part of the equation. The ability to investigate a building's history, review its strata position and, where possible, inspect what has actually been delivered remains central to making an informed apartment purchase.

At The Lennox, its completed status provides that opportunity before contracts are signed, while Strata Surety adds a financial backstop against special levies beyond the protections already provided under NSW strata law.

[smartcode_project_cta:default project_id=5743]

Joel Robinson

Buying with confidence: What NSW apartment buyers should check beyond the defect headlines

Too often, heritage buildings become the podium for a contemporary tower. At <a href="https://www.apartments.com.au/new-apartments/623-collins-607-623-collins-street-melbourne-vic-3000">623 Collins</a>, <a>Sterling Global</a> challenged its design team to reverse that process.

The brief to <a href="https://www.apartments.com.au/architects/plus-studio">Plus Studio</a> was deliberately simple: "Don't design around the heritage. Design from it." It became the philosophy behind a project that draws inspiration not only from two landmark heritage buildings, but from Collins Street itself, a street layered with architectural history and civic significance.

That philosophy has shaped one of <a href="https://www.apartments.com.au/developments/melbourne-vic-3000">Melbourne</a> CBD's most considered residential projects, where the 1924 State Savings Bank and neighbouring Batman's Hill Hotel have become the architectural foundation for 623 Collins rather than remnants preserved beneath a new development.

[smartcode_project:default project_id=145324 project_image_fid=372749]

Rather than approaching the site as a blank canvas, <a href="https://www.apartments.com.au/developers/sterling-global">Sterling Global</a> saw the existing buildings as the beginning of the story.

"Sites like this rarely become available," the developer said.

"623 Collins wasn't simply an opportunity to develop a prominent CBD site. It was an opportunity to restore and reimagine one of Melbourne's important heritage landmarks while contributing to the continued evolution of Collins Street. For us, the existing buildings weren't constraints. They were the beginning of the story."

Instead of mimicking the ornate heritage architecture, Plus Studio studied the proportions, rhythm and craftsmanship of the original buildings before translating those characteristics into a contemporary 42-storey tower.

[smartcode_project:default project_id=145324 project_image_fid=372748]

"The brief challenged us to create a contemporary landmark that respected Melbourne's architectural history without becoming nostalgic," Plus Studio said.

"Rather than mimicking heritage, we sought to understand its proportions, rhythm and material language before translating those qualities into a distinctly contemporary architectural expression."

The practice says the State Savings Bank and Batman's Hill Hotel became the project's primary source of inspiration, allowing the heritage buildings and contemporary architecture to exist "in conversation rather than contrast." Generous planted terraces further soften the transition between old and new, creating elevated green spaces while reinforcing the dialogue between the restored podium and the contemporary tower.

That dialogue continues throughout the interiors, where Melbourne designer Fiona Lynch developed a material palette inspired by the idea of alchemy, balancing contrasting materials that reference both the Neo-Grec detailing of the original bank and contemporary urban living. The result is a series of spaces that feel timeless rather than trend-driven.

[smartcode_project:default project_id=145324 project_image_fid=354343]

The project will deliver 316 residences across four collections, Heirloom, Signature, Reserve and the Penthouse Collection, with each responding differently to its position within the building, from the restored heritage podium through to the upper levels of the tower. The Heirloom Residences retain defining heritage elements including original heritage windows, generous proportions and high ceilings, while the tower introduces contemporary homes with expansive layouts and elevated views.

Amenities have likewise been designed to support long-term city living rather than short-stay convenience. Residents will have access to concierge services, wellness facilities including a pool, cold plunge, sauna, steam room and gym, alongside private lounges, entertaining spaces and dedicated resident clubs.

Sterling Global says that approach is resonating with buyers seeking permanence rather than novelty.

[smartcode_project:default project_id=145324 project_image_fid=354347]

According to the sales team, purchasers are looking for enduring architecture, generous floorplans, heritage character and long-term value, with many commenting that 623 Collins "doesn't feel like another apartment development" because of the way the architecture has been curated around the site's history.

Situated on the prominent corner of Collins and Spencer streets, the project occupies one of Melbourne's most recognisable gateway sites, marking the western entrance to the city's best-known street. For Sterling Global, it also reflects a broader shift in city-making.

"Rather than maximising development yield, the project embraces adaptive reuse as a design philosophy, allowing heritage to inform architecture, interiors and the overall resident experience," the developer said.

"The result is a building that feels uniquely connected to Melbourne."

[smartcode_project_cta:default project_id=145324]

How Sterling Global designed 623 Collins from Melbourne's history

Avant Townhomes is adding to Ivanhoe’s family-sized housing options with <a href="https://www.apartments.com.au/new-townhouses/three-82-ivanhoe-382-upper-heidelberg-road-ivanhoe-vic-3079">Three 82</a>, a collection of just 16 four-bedroom townhomes on Upper Heidelberg Road.

The <a href="https://www.apartments.com.au/developers/intrapac-property">Intrapac Property</a> townhome division has taken a contemporary approach to the traditional family home, pairing larger floorplans with the lower-maintenance format of a townhouse.

[smartcode_project:default project_id=152069 project_image_fid=374394]

Designed by <a href="https://www.apartments.com.au/architects/arcadia-studio">Arcadia</a>, with landscaping by Landsite, the homes feature generous open-plan living and dining areas that connect directly to outdoor spaces, with layouts also designed to maximise natural light and privacy.

Natural stone is used throughout the interiors, including in kitchens that pair stone surfaces with bespoke cabinetry, considered storage and SMEG appliances.

The four-bedroom layouts include built-in wardrobes and a main bedroom with its own ensuite, while family bathrooms service the additional bedrooms. Each home also includes a lock-up double garage and intercom entry.

[smartcode_project:default project_id=152069 project_image_fid=374399]

Energy efficiency has been incorporated into the design through solar panels, double glazing and reverse-cycle heating and cooling, with the homes targeting 7-star energy ratings.

Rather than incorporating extensive communal facilities, Three 82 has been conceived around private residential amenity, with the 16-home scale keeping the focus on individual homes and their own indoor and outdoor spaces.

The development is located at 382 Upper Heidelberg Road, around one kilometre from Ivanhoe Village's cafés and retail and a short drive from Eaglemont Station and Ivanhoe Station.

[smartcode_project:default project_id=152069 project_image_fid=374393]

Several of Ivanhoe's established schools are also nearby, including Ivanhoe Girls' Grammar and Ivanhoe Grammar School. The address also provides access to the suburb's parklands and the wider Yarra River corridor.

<a href="https://www.apartments.com.au/project-marketer/nelson-alexander">Nelson Alexander</a> has been appointed to handle sales.

Construction is underway and progressing well, with Three 82 currently tracking toward completion in Q2 2027.

[smartcode_project_cta:default project_id=152069]

Three 82 brings boutique four-bedroom townhome collection to Ivanhoe

Builder-developer&nbsp;<a href="https://www.apartments.com.au/developers/graya">Graya</a> has secured a prime Newstead site from fellow developer Fraser, subsequently lodging plans for The Silo, a major mixed-use residential project in Newstead designed around a new public laneway linking the James Street precinct with the wider Gasworks and Newstead neighbourhood.

Proposed for the corner of Chester and Morse streets, the <a href="https://www.apartments.com.au/architects/bureauproberts">Bureau^Proberts</a>-designed project places its strongest emphasis at ground level, where retail, landscaping and a new cobblestone pedestrian connection would open the site to the surrounding neighbourhood. The design team describes The Silo as “more than a residential building”, positioning the development as an extension of Newstead’s public realm rather than a standalone apartment tower.

“A new cobblestone laneway and landscaped connection between James Street and Gasworks unlock a missing pedestrian link, improving walkability and stitching together two of Brisbane’s significant urban destinations,” Bureau Proberts said in its Urban Design Report.

<img alt="First look: Graya plans The Silo as new pedestrian link between James Street and Gasworks" data-entity-type="file" data-entity-uuid="0ea1b06a-75f5-40a5-b2c5-33c97bc86052" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/silo%20bldg.png?VersionId=KmjsAtNePu57_B31EM_DJ5T6KPJHtcmo" />

The Silo is planned as a mixed-use development incorporating apartments alongside a bar and centre activities including food and drink outlets, indoor sport and recreation, office and retail uses.

Architecturally, Bureau Proberts has conceived the building as a collection of vertically expressed, stepping forms rather than a single uniform tower. The composition rises from an articulated podium before being broken by a triple-height landscaped recreation level, with the upper section becoming more compact before terminating in a landscaped rooftop garden.

The project's name and architectural language draw directly from Newstead's industrial history. Patterned off-form concrete is proposed as the principal façade material, complemented by slender metal rod balustrades and extensive planting. The cylindrical and vertically ribbed elements give the building its silo-like expression, while curved balconies and planted edges introduce a softer subtropical layer.

“The Silo reinterprets its robust forms, scale and materiality through a contemporary subtropical architectural expression, creating a building that acknowledges its industrial legacy, while responding to the way the precinct is occupied today,” Bureau^Proberts said.

The recreation level is one of the defining breaks in the tower. Plans include a lap pool, mature subtropical planting and shared resident facilities within an elevated communal garden. Landscaping continues through the podium and onto the rooftop, where a further garden forms what the architects describe as a “subtropical crown” to the building.

<img alt="First look: Graya plans The Silo as new pedestrian link between James Street and Gasworks" data-entity-type="file" data-entity-uuid="f8451036-35a4-49a9-8d88-2ef4438eba3d" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Silo%20Lane.png?VersionId=h8N31_rYmCEqoNrpt4kbYVQhJGZn60LH" />

At street level, the development has been designed to establish a more permeable block. Retail and hospitality tenancies address the public realm, while landscaped pedestrian spaces lead into the new laneway connection. Renders in the design report show the proposed “Silo Lane” as a substantial opening through the podium, framed by cylindrical concrete forms with cascading planting above.

The Silo continues Graya's move into larger apartment developments after building its reputation across high-end residential projects in Brisbane and the Gold Coast.

Graya buys Frasers Newstead site, plans The Silo between James Street and Gasworks precincts

<a href="https://www.apartments.com.au/developers/wickton">Wickton</a>’s completed Linacre Rise development in Hampton is giving Bayside downsizers the opportunity to move into a spacious apartment near the beach, with the developer covering stamp duty for a limited time.

The 27-residence development has been designed for buyers who want to simplify their living arrangements without giving up the space, warmth and quality associated with a long-term family home. Most apartments have already been secured by Bayside locals, leaving a select collection of two and three-bedroom residences and penthouses available.

Two-bedroom apartments are priced from $1.275 million, three-bedroom residences from $2.25 million and penthouses from $3.375 million, with the completed homes available to inspect and move into now.

[smartcode_project:default project_id=95289 project_image_fid=366760]

<a href="https://www.apartments.com.au/buildings/linacre-rise-hampton-8-10-linacre-road-hampton-vic-3188">Linacre Rise</a> occupies an elevated position on one of <a href="https://www.apartments.com.au/developments/hampton-vic-3188">Hampton</a>’s quiet, tree-lined streets, around 250 metres from the bay and 500 metres from Hampton’s village centre. Its setting gives residents access to the beach, local cafés, shops and Hampton Train Station while retaining the feel of an established residential neighbourhood.

Architecture and interiors by <a href="https://www.apartments.com.au/architects/ewert-leaf">Ewert Leaf</a> draw on the warmth and permanence of traditional brickwork, with the building integrated into terraced landscaping by <a href="https://www.apartments.com.au/landscape-architect/john-patrick-landscape-architects">John Patrick</a>. Ground-floor apartments are elevated above the street and include private garden courtyards, while several upper-level residences have generous balconies and outlooks toward the bay.

Inside, the residences favour natural materials and generous proportions. Herringbone-pattern European oak flooring, natural stone benchtops, premium joinery and Swiss V-ZUG appliances are among the key inclusions, while integrated storage has been incorporated across kitchens, bathrooms, studies and living areas.

The kitchens have been planned as practical spaces for both everyday use and entertaining, with substantial island benches, detailed cabinetry and adjoining dining and living zones. Full-height wardrobes, plush bedroom carpeting and carefully considered lighting reinforce the residential character Wickton sought to retain for buyers moving from larger homes.

[smartcode_project:default project_id=95289 project_image_fid=366769]

A Linacre Rise purchaser said the completed apartment had delivered the space, outlook and construction quality they had been seeking.

“The unit is very light, has views to die for over the bay, all construction materials and fittings are premium quality, we have secure parking for three cars, EV charging at very competitive rates, the neighbours are friendly and there is just a lovely ambiance about the place,” the purchaser said.

Environmental features include solar panels, shared electric vehicle charging stations, rainwater harvesting for toilet flushing and landscape irrigation, double-glazed windows and water-efficient fixtures and appliances.

[smartcode_project:default project_id=95289 project_image_fid=366762]

The development was built by Balmain &amp; Co, with Wickton managing the broader development process through its in-house team.

For downsizers, the project’s completed status removes much of the uncertainty associated with buying off the plan. Purchasers can inspect the finished apartments, understand their outlook and proportions, and move in without waiting for construction to conclude.

The remaining selection includes north-oriented balconies, corner configurations and penthouses with elevated bay views. The developer-paid stamp duty initiative is available for a limited time, with potential savings of up to $200,000 depending on the residence purchased.

[smartcode_project_cta:default project_id=95289]

Limited-time stamp duty offer at completed Linacre Rise apartments in Hampton

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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The fashion giant Zara will open its multi-level store at Westfield Chatswood  on Thursday 13 February.

Zara's new Autumn/Winter collection will be on display.

Zara's new <a target="_blank" href="/news">Chatswood</a> home continues the international brand's strong Westfield presence with its only two other Sydney locations in Westfield Bondi Junction and Westfield Sydney.

European fashion giant Zara opened its first Australian stores in Melbourne and Sydney in 2011.
news@propertyobserver.com.au

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jchancellor-FAypfDUnLy

Zara set for February 13 Westfield Chatswood opening 

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Retail giant David Jones has confirmed it received a merger offer from rival Myer in October last year.  
David Jones revealed it received the “confidential, conditional and non-binding and indicative” offer from its rival on October 28, which saw Myer offer 1.06 shares for every David Jones share.  
However the offer, investigated by the Australian Securities and Investments Commission, was rejected on the grounds it had “substantial commercial, market, and regulatory risks” including a review from the Australian Competition and Consumer Commission.  
“The board formed the view that the potential transaction did not have sufficient merit for David Jones shareholders to warrant engaging in discussions and providing the access and information requested by Myer,” David Jones said.
This article first appeared on <a href="https://www.StartUpSmart.com.au" target="_blank">StartUpSmart.</a>
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Myer discussed a merger with David Jones last year

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The New South Wales and Victorian governments have recently released business cases for their pet motorway projects, <a target="_blank" href="https://www.westconnex.com.au/documents/westconnex-executive-summary-september-2013.pdf">WestConnex</a> in Sydney and <a target="_blank" href="https://www.linkingmelbourne.vic.gov.au/pages/pdfs/east-west-link-stage-one--short-form-business-case.pdf">East-West Link</a> in Melbourne. But will these projects, costing a combined $20 billion (with $3 billion being donated by the federal government), really generate the economic benefits promised?

Take WestConnex, for example. NSW Premier Barry O’Farrell <a target="_blank" href="https://www.rms.nsw.gov.au/newsevents/news_ministerial/2013/130919-biggest-transport-project-in-australia">claims</a> that this $11.5 billion motorway will “inject $20 billion into the economy”. But Infrastructure Australia has <a target="_blank" href="https://www.afr.com/p/national/infrastructure_boss_lashes_out_yoIxPWcyrNuiI0Ldqw60HJ">poured fresh doubt</a> on such claims, describing big-ticket road promises as electioneering with “only limited regard” for the underlying financial issues.
A glance at the <a target="_blank" href="https://www.westconnex.com.au/documents/westconnex-executive-summary-september-2013.pdf">WestConnex business case</a> reveals that some $18 billion of the claimed economic benefit is merely the value of expected “travel time savings” and “travel time reliability”. This is basically the amount of money that a team of economists (paid by the NSW government) has decided motorists would hypothetically be willing to pay for shorter and more reliable travel times. The actual calculations and underlying assumptions have not been made public.
But, except in the case of freight and business travel, there is unlikely to be any reduction in average travel times; and even if there were, this would not result in any real income or cost-savings for the economy.
For more than a century the average time humans spend travelling each day has been a <a target="_blank" href="https://assets.dft.gov.uk/publications/trunk-roads-and-the-generation-of-traffic/trunk-roads-traffic-report.pdf">constant 60-80 minutes</a>. Whenever we’ve been provided with faster transport options, we’ve simply opted to live further from work and travel longer distances, but keep our daily travel times the same.
This is why no previous motorway project, in Sydney, Melbourne, or any other city in the world, has ever succeeded in reducing average daily travel times. Rather, they have resulted in <a target="_blank" href="https://www.vtpi.org/gentraf.pdf">longer average travel distances, more traffic, more sprawl and therefore increased transportation costs</a>. There is no reason to believe that WestConnex or East-West Link will be any different.
Economic injection?
But let’s say, for the sake of argument, that these motorways will reduce average personal travel times. Will this then result in billions of dollars being “injected into the economy”?
Well, no. Basic <a target="_blank" href="https://www.sciencedirect.com/science/article/pii/S1366554500000132">utility theory</a> suggests that most of the time we save we would spend on other non-productive activities, such as watching TV or checking Facebook. This will not result in any money flowing into the economy, let alone A$18 billion. On the contrary, individual motorists will be financially worse off because of the new tolls - as much as <a target="_blank" href="https://smh.drive.com.au/roads-and-traffic/drivers-face-735-toll-on-new-115b-westconnex-20130919-2u2lo">$20 a day</a> for users of WestConnex.
And how confident can we be that the economists have correctly valued our willingness to pay for these “travel time savings”? They got it wrong with Sydney’s Cross City Tunnel, calculating that 70,000 drivers a day would be willing to pay the $4.90 toll to save time driving across the Sydney CBD. The actual number turned out to be only 40,000.
Furthermore, increasing the speed of the road network will <a target="_blank" href="https://www.vtpi.org/gentraf.pdf">encourage more people and freight to switch from rail to road</a>. We will end up with more traffic, congestion and toxic exhaust fumes, and calls to build yet more costly motorways through our neighbourhoods to “fix the congestion”, ad infinitum.
These motorway projects may provide some short-term economic stimulus in the form of construction jobs and bonuses for consultants and bankers, but then so could building a $20 billion giant white elephant on top of Parliament House. However, this short-term economic stimulus will be far outweighed by the long-term economic burden of increased sprawl and car-dependency in an age of increasing petrol prices. Sydney and Melbourne already spend about <a target="_blank" href="https://trid.trb.org/view.aspx?id=511932">13% of GDP on transport</a>, while the average European or Asian city spends only between 5% and 8%.
Much of the funding for WestConnex will come from the <a target="_blank" href="https://theconversation.com/are-we-selling-off-the-family-silver-by-privatising-australias-ports-13824">privatisation of Port Botany</a>. But selling revenue-generating public assets to invest in infrastructure only makes sense if the economic or social return on that infrastructure outweighs the forgone future revenue from the privatised assets. The NSW government is essentially depriving future taxpayers of revenue from Port Botany, and imposing more tolls on Sydney motorists, simply to make it possible for more of us to move further away from work and suffer longer and more expensive commutes. We will keep our average daily travel times the same, just as we always have done.
There are cheaper, <a target="_blank" href="https://www.sciencedirect.com/science/article/pii/S0966692303000607">more effective and more sustainable ways</a> of giving us better and more equitable access to jobs and services, and more pleasant daily commutes. The $20 billion being squandered on WestConnex and East-West Link could instead be used to create jobs in growth areas, build affordable family homes near existing employment centres, and construct new rail lines and busways. Such strategies would help to build and enhance local communities.
Urban motorways only ever succeed in destroying and severing them.
Chris Standen is a PhD candidate in Transport Economics at <a target="_blank" href="https://www.sydney.edu.au/?">University of Sydney</a>
This article was originally published at <a href="https://theconversation.com">The Conversation</a>. Read the <a href="https://theconversation.com/big-road-projects-dont-really-save-time-or-boost-productivity-21560">original article</a>.
 
 
<img alt="The Conversation" height="1" src="https://counter.theconversation.edu.au/content/21560/count.gif" width="1">
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Big road projects: Are they really worth it?

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Last year (according to the RP Data-Rismark Home Value Index), capital city home values rose by 9.8%, creating further affordability pressures for those segments of the market who are most price sensitive; the younger aged cohorts and first time buyers.  Our daily index data shows that home values have continued their strong pace of growth through the first month of 2014 with our combined capitals index likely to end the month slightly more than 1% higher.
Based on homes sold over the December quarter, the median price of a house across Australia’s capital cities is now $575,000; ranging from $775,000 in Sydney through to $350,000 in Hobart.  In the most expensive capital cities the challenge to buy a detached house within close proximity to where they work or socialise is simply out of reach for the vast majority of younger buyers.
<img class="aligncenter size-full wp-image-2844" alt="Chart 1" src="https://blog.rpdata.com/wp-content/uploads/2014/01/Chart-12.jpg" width="470" height="171" style="margin: 0px auto 15px; padding: 3px; border: 1px solid #e6e6e6; outline-width: 0px; background-color: rgba(255, 255, 255, 0.701961); max-width: 100%; text-align: center; height: auto; display: block; vertical-align: bottom;">
Housing finance data indicates that as a proportion of the owner occupier market, first home buyers are currently at a record low level, accounting for just 12.3% of all owner occupier finance commitments. 
If first home buyers aren’t entering the market now, at a time of historically low mortgage rates, one might consider how and when they will ever enter the market.  In my opinion it is not always a case of not being able to afford to enter the market, it is often that the sacrifices a potential buyer would have to make in order to enter the market are too great.
There are some clear reasons why housing in Australia is expensive, including::
<img src="/images/stories/2014/02/04/number-1.jpg" width="20" height="30" alt="number-1" style="float: left;"> Australian’s have high levels of personal wealth and high incomes relative to most other countries.
 <img src="/images/stories/2014/02/04/number-2.jpg" width="26" height="30" alt="number-2" style="float: left;">Australia’s population is heavily centralised with around 55% of the national population residing in either Sydney, Melbourne, Brisbane and Perth.
 <img src="/images/stories/2014/02/04/number-3.jpg" width="22" height="30" alt="number-3" style="float: left;">Job opportunities and employment availability tend to be most abundant within capital cities.
<img src="/images/stories/2014/02/04/number-4.jpg" width="22" height="30" alt="number-4" style="float: left;"> The supply of new housing within the capital cities has consistently been insufficient to meet the level of demand over the past decade or so.
<img src="/images/stories/2014/02/04/number-5.jpg" width="22" height="30" alt="number-5" style="float: left;"> Population growth is strong with relatively high levels of overseas migration and natural increase creating additional demand for housing.
<img src="/images/stories/2014/02/04/number-6.jpg" width="22" height="30" alt="number-6" style="float: left;"> The cost of vacant land has been driven to unaffordable heights due to the slow release of new residential land supply and the restrictions of urban growth boundaries in most capital cities.
<img src="/images/stories/2014/02/04/number-7.jpg" width="22" height="30" alt="number-7" style="float: left;"> Negative gearing (which is available on all asset classes) encourages many to invest in residential property as a way of reducing their tax liability which creates additional housing demand.
Although these factors all contribute to a relatively high cost of housing, it does not mean that purchasing a first home is unachievable.  An upcoming analysis which will be released by RP Data this month finds that as at the end of 2013, across the capital cities, 28.4% of all homes had a current value of less than $400,000. Even in a market which is considered significantly unaffordable such as Sydney, 17.5% (almost one in five homes) have a value below $400,000.  Of course most of these properties are not located in the desirable areas of the city, but they are available.
Many potential first home buyers either still live with their parents or rent within areas close to where they work and socialise. For those living with their parents, it’s likely that the home they are currently residing in was not their parents first home. I’m sure if you asked many of those parent’s they would say that their first home was vastly inferior to their current home (ie they upgraded when they could afford to). For those renting in inner city areas, the reason why property prices and rents are so high in these areas is that demand is very strong while supply is quite limited which in-turn results in the high prices you see within these areas.
Given this, the prospective first home buyer is, in most instances, going to have to make a sacrifice in order to enter into home ownership.  As I see it, first home buyers need to make one of two major sacrifices; either move away from their local area to an area where home values are more affordable in order to enter the market or buy something which is at the lower end of the local market (which will often be a unit rather than a house). The strategy for someone buying their first home should rarely be to buy at the  suburbs median selling price; it should be to buy an entry level property.  Of course varying levels of deposit and income will dictate what the purchaser can reasonably afford to borrow and repay.  Over time, the first home buyer should see some capital growth and it would also be reasonable to expect that they should also experience an improvement in their employment conditions (more pay/promotion/new role) which would eventually help in assisting them to upgrade.
Looking at my first home buying experience, the above scenario parallels my own. I have to admit, the home was pretty horrible but it was in the inner city location I wanted.
My first purchase was a two bedroom, one bathroom unit in Fortitude Valley in Brisbane.  The location was great but the unit was not so great.  The complex was largely utilised for short term accommodation and although the unit had two bedrooms and one bathroom, outside of those three rooms it had one further room which functioned as a kitchenette, lounge and dining room.  I purchased the property for $248,000 in July 2005 and sold the property in April 2010 for $334,000 effectively five years later.  At the time of purchase, the median unit price within the suburb was $309,240 and by the time of sale the median unit price in the suburb was $400,000.
The unit was purchased at a price well below the suburb median and upon sale the price had increased by 35%.  In comparison the median sale price across Fortitude Valley had increased by a lower 29%.  At the time I was single so I also had a friend come and live with me which assisted in making the mortgage repayments.
By the time I sold the property I had purchased a subsequent property which was a house, once again it was purchased at a price below the suburb’s median.  I had managed to make a profit on the sale of my first home and purchased a more expensive property, I had also benefitted from an increase in salary over the time which made repayments easier.
In my experience the choice to purchase a first home is never an easy one.  It is often the case that what you think you should be able to get for your money and what you actually can get are very different.  But having an understanding of your budget and doing your research to get a realistic expectation of what properties and in what location you can afford to purchase takes some of the pain out of the house hunting process and purchasing.
Undoubtedly some people will not be able or willing to purchase but bemoaning the high cost of housing in the local area is unlikely to change the situation outside of wide-spread changes to government policy(ies).
Cameron Kusher is senior research analyst at <a href="https://www.myrp.com.au/" rel="nofollow" target="_blank">RP Data</a>.
 
 
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Seven reasons Australia's housing is expensive; is it out of reach for first home buyers? 

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In my previous article, '<a href="https://www.propertyobserver.com.au/finance/australian-property-prices-explained-independent-analyst/2014011367181" target="_blank">Australian property prices explained</a>', I presented a chart that provided very accurate narrative on what has happened in the Australian property marketover the last three decades.  

It is safe to conclude that the same concept which allowed for the description of the past with such accuracy, should also be able to provide a reasonable guidance for the future.  
Of course, predicting exactly what will happen in 2014 and beyond is a tall order. Life is known to create such a variety of unanticipated scenarios that the reality will almost certainly play out differently to what everybody expects.  
Therefore, I prefer to think about the future in terms of a range of possible outcomes and likely probabilities of occurrence rather than as a single, definite result.  
The real benefit of such an approach is knowing how changes in economic conditions can potentially affect the outcome - not in picking the exact end result in advance.  
Since changes in some economic factors will have more profound effects than others, if you can identify in advance what are they, you can watch out for the tell-tale signs that a particular scenario is playing out – and act accordingly.  
You only need to be right about the direction property prices are heading to be able to benefit.
Please consider what follows with caution - in the “what if” category, rather than a certainty.  
Based on the income capacity of working Australians, residential property in this country is not overpriced and prices are far from bubble territory.  
The proof is in relative changes in the cost of buying over the last 27 years, which has been significantly below the relative changes in personal incomes over that time. Below is a slightly different representation of that information to highlight this point. 
<img src="/images/stories/2014/01/31/arek_jan_31_one.jpg" width="470" height="299" alt="arek_jan_31_one">
By rearranging the data we can create a chart that shows how much more property prices could increase at present and still be considered affordable (in relation to current incomes and as benchmarked to 1986). 
<img src="/images/stories/2014/01/31/arek_jan_31_two.jpg" width="470" height="301" alt="arek_jan_31_two">
The above chart indicates that current property prices are potentially undervalued by as much as 45%. Of course, this does not mean that prices will immediately move by this much but the potential for a substantial jump is there.  
Yet another perspective using the same underlying data reveals that conditions are now starting to resemble those in 2009. Although affordability in 2009 was not as extreme as in late 1990’s, it nevertheless led to a substantial price increase in 2010.
<img src="/images/stories/2014/01/31/arek_jan_31_three.png" width="470" height="277" alt="arek_jan_31_three">
Therefore, as history shows, if interest rates remain mostly unchanged and incomes keep growing, we can anticipate a significant jump in property prices in coming years.  
The increase could either be a rapid advancement of 10-20%, or even 30%, in the next 12-24 months if the 'good times' perspective prevails or, if pessimism dominates, it could result in an even more substantial jump but in the more distant future.  
Of course, this scenario can only play out on the proviso that there are no unexpected shocks applied to the system, such as a major international conflict, another economic calamity in the region, another collapse of world financial system, or a major natural disaster – to mention a few obvious cases.  
In terms of further outlook, if the relationship between costs of buying, incomes, rents and prices hold in the future, and the current rate of income growth continues, then it can be estimated that from now to the end of 2023 property prices could grow by as much as 140% under a historically low interest rate scenario (i.e. 5% per annum), or as little as 20% under a high interest rate scenario (i.e. 10% per annum).  
Under a more probable scenario of slower growth in incomes and interest rates averaging 7% per annum over the next decade, prices can still be expected to grow by 60% in the next 10 years.  
A much gloomier future is also possible but the probability of this scenario is rather small at this point in time.  
That is, a 40% drop in property prices is possible in the next decade but it would take extreme economic conditions for this scenario to play out. In particular, mortgage rates would have to persist at close to 20% per annum for a good part of the decade and income growth would have to drop to 2% per annum to bring prices down by this much.  
In conclusion, the outlook for property prices in Australia is positive - unless of course the world encounters another economic disaster of a magnitude that is hard to even imagine.  
Some insist that the next big event is 'just around the corner' so, it would be wise to keep an eye for the tell-tale signs of possible troubles brewing somewhere in the world but there is no obvious reason to panic just yet.    
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.
You can contact Arek on <a target="_blank" href="https://twitter.com/arekdrozda">Twitter</a>.
 
 
 
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Australian property prices in 2014 and beyond - a peek into the future

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The first week of February looks to be a busy one for property investors. We look at the dates to keep in mind, and what the indicators might mean for you.
February 2: RPData/Rismark Home Value Index
Marking home price trends by suburb, postcode, capital city and state, the RPData/Rismark Home Value Index is released on a monthly and quarterly basis. CommSec expects that the latest release may show a price lift of 0.8% in January.
February 3: TD Securities inflation gauge (January), ABS building approvals (December), ANZ job advertisement data
The TD Securities and the Melbourne Institute have devised their inflation gauge to indicate monthly movements in the inflation rate, with a one month lag. As always, keeping an eye on inflation will allow investors to have a better idea of future interest rates.
As we’ve <a target="_blank" href="/news">noted before</a>, increasing building approval rates can indicate a possible oversupply of property in the future. It’s expected that approval rates stayed flat in December.
February 4: Reserve Bank of Australia (RBA) board meeting
The RBA cut the official cash rate last August to an <a target="_blank" href="/news">all-time record low of 2.50%</a>.
Since then rates have remained on hold and our <a target="_blank" href="/news">experts predict</a> that the cash rate will remain unchanged this month.
February 6: ABS international trade data (December) and retail trade data (December)
Thursday’s data releases will help investors gauge the state of the economy. We’ll find out the extent of the country’s trade deficit (CommSec is expecting the deficit to near $350 million), and whether retail sales have increased in the last quarter.
February 7: RBA statement on monetary policy
Investors will have a better idea of the RBA’s monetary policy stance after Friday. It remains to be seen whether the RBA is comfortable with the December quarter’s <a target="_blank" href="/news">higher than expected</a> inflation figures. 
jrichardson@propertyobserver.com.au
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jrichardson-uRX5hFdKfN

For the diary: The big dates in property for the first week of February

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In 2013 the property market had a bumper season. House prices in major cities rose substantially, investors bolstered the Sydney market to new heights and clearance rates in Melbourne and Sydney returned to three-year highs.
The median house price in Sydney rose by 15.1% to $793,000 and in Melbourne the median price jumped 8.6% to $569,000, according to Australian Property Monitors (APM).
With house prices through the roof and predictions first home buyers are being locked out of the market by the skyrocketing values, 2014 is set to be an interesting year in property.
APM chief economist Andrew Wilson gave us his five predictions for 2014.
1. House price growth to slow
Sydney and Melbourne were the hot markets in 2013, but this is set to change in 2014.
Wilson says house price growth peaked in Melbourne and Sydney in the December quarter last year.
“Sydney reached record-level price growth rates, the best in 10 years, and was overall very high by historical standards, but economic headwinds are blowing against medium-term growth in house prices now,” he says.
“The lower dollar will impact inflation, wage growth has slowed and this will impact living standards.”
Wilson says the level of growth reached in 2013 will be difficult to sustain.
“Markets will start well, there is still a lot of energy in the market, but this will moderate and we’re looking at likely growth rates of about half of what was achieved in 2013 in Melbourne and Sydney,” he says.
“There is more pessimism than optimism about the New South Wales and Victorian economies. The Sydney market will also have issues to do with affordability because of low income growth.”
2. Brisbane and Perth – the new hotspots
While Melbourne and Sydney slow, Brisbane is tipped to bang.
“The Brisbane market is still in catch-up mode, but the Queensland economy is ramping up with regional centres recording growth. There will be an increase in job seekers in Queensland too, as they shift from Melbourne and Sydney where the jobless rate is higher,” Wilson says.
“Investors will be more interested in Brisbane real estate because of its potential for high yields and prospects of high capital growth.”
Wilson says the Adelaide market is resilient, despite there being issues with its local economy.
“It doesn’t have that volatility in the housing market, so modest growth of about 3% is expected. Canberra is a similar story with jobs being shed in the public service, so house price growth of around 3% to 5% is expected in 2014.
Hobart is starting to show some improvement in its property sector, so modest house price growth can be expected.
Wilson says Perth is tipped to perform well, continuing its strong run in the property sector with growth between 6% and 8% for 2014 predicted.
3. Clearance rates to moderate
The cause and effect between clearance rates and house price growth was observed in 2013, with strong clearance rates reflecting higher prices.
Wilson says one of the early signals of the market starting to moderate will be clearance rates falling back from high percentages in Melbourne and Sydney.
“I expect to see that as a forward indicator of moderating buyer activity. This will be apparent in the June quarter, rather than March and it will be interesting to see if they can be maintained in Sydney,” he says.
“Clearance rates started to fall away in November-December last year, but there was a lot of stock going into the market. With record levels of properties auctioned, this could have easily caused clearance rates to fall slightly, so we’ll see how it pans out over March.”
4. Suburbs to watch
Sydney’s prestige market had lagged behind the rest in 2013, but it’s expected to pick up pace in 2014.
“It started to pick up toward the end of the year and it will take advantage of that increased confidence,” Wilson says.
“Sydney’s northern shore and eastern suburbs will do well. Growth levels were modest in 2013 and there is room to grow there. If we see strong results from the sharemarket, the prestige market will keep bubbling along.”
In Melbourne, the expensive areas of the eastern suburbs were the best performers of 2013.
“The eastern suburbs have been the star performers of 2013, but there are questions as to whether they’ve reached affordability barriers,” he says.
“They still have some upsides like Sydney’s premium markets, but generally there will be a moderation of price growth. Declining numbers of first home buyers is also likely to impact the outer eastern suburbs.”
5. Owner-occupier versus investors
Each city has its own property market characteristics and in 2013 investors dominated the Sydney market, while owner-occupiers were more prevalent in Melbourne.
“In NSW there were record numbers of investors recorded by the Australian Bureau of Statistics,” Wilson says.
“But we have to be mindful of overshooting the rental market in Sydney and I question if there’s enough demand. We’re already seeing rents flat lining and vacancy rates start to rise.”
Wilson says this will put pressure on investors looking for cash flow.
“The only hook will be prices growth, but I think investors will start to look at Brisbane instead, and possibly Adelaide to a lesser extent.”
This article first appeared on <a target="_blank" href="https://www.SmartCompany.com.au">SmartCompany.</a>
 
 
 
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Andrew Wilson's five property predictions for 2014

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The Australian Housing and Urban Research Institute (AHURI) has concluded that an estimated 9% of all Australians aged 50 and over had downsized their dwellings to homes with fewer bedrooms between 2006 and 2011.
Merging the results of a 2011 2,819-participant survey and ABS data, AHURI estimates that the largest proportion of downsizers in Australia (comprise over 81,000 individuals) were between aged between 55 and 64.
Of the participants who had downsized, 47% had moved into a two bedroom home, 10% moved into a one bedroom home, and 1.7% into a bedsit. Individuals who moved downsized into three bedroom homes comprised 42% of all downsizers. However, downsizers generally didn’t move far – 70% of participants moved to a home in the same suburb or region they were previously living in.
Changing lifestyle preferences were the most common factors contributing to the decision to downsize, nominated by 38% of the participants. Other reasons nominated included the inability to maintain a larger house or garden, leaving home, or retirement. Participants also raised health family circumstances, with 12% nominating relationship breakdown as a motivating factor, while 7% reported the illness of a partner or self, and the same proportion nominated their partner’s or their own disability.
The institute raised financial barriers as a disincentive for relocation for senior Australians. In 2006-2011 period, only 18% of Australians aged between 65 and 74 and 16% of those aged 75-74 moved house, while 46% of people aged between five and 54 relocated in the same period. According to AHURI, while some may expect downsizing to free up housing capital for older homeowners, the demand for two-bedroom houses, especially in New South Wales, has driven up housing prices and reduced the financial benefit of downsizing. AHURI also raises the impact of housing capital gains on aged pension eligibility.
AHURI’s full report can be seen <a href="https://www.ahuri.edu.au/publications/projects/p70687">here</a>.
<a href="mailto:jrichardson@propertyobserver.com.au" target="_blank">jrichardson@propertyobserver.com.au</a>
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Older Australians downsizing homes, but barriers still exist

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In a turnaround for preferred property types in 2013, value growth for houses outperformed units whereas in 2012 it was the opposite. However, I question whether this will last during 2014, especially if buyers are locked out of markets due to affordability constraints.
Using the results in the December 2013 RP Data-Rismark Home Value Index, the combined capital city house values increased by 9.9% in 2013, compared to a 9.0% increase in unit values.
Although house values rose at a faster pace than units over the year, capital city houses and units recorded similar annual rates of growth over the past five years, at 4.8%, and 4.7% per annum respectively.
If we look at the median selling prices for houses and units across all capital cities over the final quarter of 2013, unit prices were around $95,000 lower than median house prices.
Across the individual capital cities, Adelaide had the smallest gap at $80,000 while in Sydney it was $218,000, Darwin $145,000, Melbourne $144,000 and Canberra $138,000; all recorded a differential which is greater than $100,000.
<img src="/images/stories/2014/01/29/kusher-jan-29-one.gif" width="470" height="233" alt="kusher-jan-29-one">
Based on these results, buyers may now opt to purchase units over houses, particularly in the more expensive cities where units are in abundance in the inner city areas and where the price difference between houses and units can be significantly greater than those across the broader capital city areas.
By percentages, the median unit prices across the combined capital cities are currently -16.5% lower than median house a price which is a record high differential. At the same time in 2012, the differential was - 14.3%.
<img src="/images/stories/2014/01/29/kusher-jan-29-two.gif" width="470" height="231" alt="kusher-jan-29-two">
Again, the widening gap between house and unit prices is likely to drive more purchasers to the unit market rather than the detached housing market.
At an individual capital city level, the price difference between houses and units has been increasing:
•Sydney - 28.1%
•Melbourne - 23.0%
•Brisbane - 18.5%
•Adelaide - 19.8%
•Perth - 18.3%
•Hobart - 27.1%
•Darwin - 24.5%
•Canberra -24.2%
<img src="/images/stories/2014/01/29/kusher-jan-29-three.gif" width="470" height="234" alt="kusher-jan-29-three">
For Sydney, Melbourne and Hobart, the differential in prices is at an all-time high. For Brisbane the price differential is the highest since early 2010, and in Adelaide it is at its largest level since the middle of 2008. The gap has closed slightly recently in Perth and Canberra, whilst in Darwin the differential is the greatest since late 2010.
If dwelling approvals data is anything to go by, it seems that in many of the capital cities new supply will be dominated by units rather than houses.
Over the 12 months to November 2013, approximately 50% of all approvals were for units in Melbourne and Brisbane while in Sydney, Darwin and Canberra, more than 60% of all dwelling approvals over the year were for units.
<img src="/images/stories/2014/01/29/kusher-jan-29-four.gif" width="470" height="237" alt="kusher-jan-29-four">
With strong value increases in some cities across 2013 coupled and with an increase in selling prices, we may see price sensitive buyers start to look at the unit market where there are many more options available.
As to who should be buying where, first home buyers should look at older units in inner city areas as these can offer more affordable entry points into the market while still being within popular locations. Units also offer a good housing alternative for those looking to downsize.
From an investor’s perspective, units typically enjoy stronger rental demand and superior gross rental yields to those awarded by houses.
All of these benefits are in most cases afforded at much lower prices than houses within the same local area.
Cameron Kusher is senior research analyst at <a target="_blank" rel="nofollow" href="https://www.myrp.com.au/">RP Data</a>.
 
 
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Mind the price gap: Units currently better value for buyers than houses

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Mobile payments company Square, founded by Twitter co-founder Jack Dorsey, is rumoured to be coming to Australia, potentially providing small businesses with an easy in-store payment solution.
Speculation started circulating earlier this month after a photo was posted on Twitter of Dorsey and Communications Minister Malcolm Turnbull, accompanied by the message “disruptive innovation soon to come to Aus”.
Since then sources have confirmed to The Australian Financial Review preparations have begun to launch the business down under.
The technology has been a success in the United States and should it enter the Australian market is expected to disrupt the banks and provide businesses with a cheaper and simpler solution to electronic payments.
Square allows businesses to accept electronic payments on their iPhones, iPads or Android devices through the attachment of a card reader.
It’s also created the Square Wallet, an app which allows people to pay at some US retailers by simply saying their name.
Pin Payments head of business development Chris Dahl told SmartCompany new players coming into the market help to drive innovation.
“It’s a good thing for Australian tech companies and also for Australian businesses. From our experience helping small and medium-sized businesses get online and start transacting quickly, this is effectively what Square will be able to do in the retail space,” he says.
“We help online business and Square is a clear alternative for the retail space. We think it’s great and we’ve been following its progress.”
Dahl says there are local competitors to Square such as Kounta, but more competition in the space is a good thing.
“Anything which helps businesses to not have to liaise with the banks is a good thing,” he says.
“Before solutions like Pin Payments, or in retail companies like Square, businesses had to go to one of the banks, approach their merchant team and explain the business. The bank would generally ask for a business plan and a transactional history and the process can take weeks to months.”
Dahl says online businesses frequently approach them after waiting months to set up a payment system with a bank.
“Banks are big organisations and for small-to-medium-sized businesses where they might not have a business plan completely fleshed out or have a transactional history, players like Pin and Square are filling that void,” he says.
In the past two years <a href="https://www.smartcompany.com.au/growth/economy/33127-the-future-of-payment-technology-new-systems-which-could-help-your-business">payment systems have started to develop rapidly</a>, as Australian businesses have pushed for innovation in the space.
In 2013 Pin Payments launched, Braintree came to Australia and PayPal launched new technology allowing businesses to accept payments via mobile phone and letting consumers order and pay on the go.
Speaking to the Australian Payments Clearing Association in 2012, Reserve Bank of Australia governor Glenn Stevens said elements of Australia’s payments infrastructure are “a bit dated”.
“It is very clear that both individuals and businesses are demanding greater immediacy and greater accessibility in all facets of their day-to-day activities,” Stevens said.
“This includes payments.”
This article first appeared on <a href="https://www.SmartCompany.com.au" target="_blank">SmartCompany.</a>
 
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