Malaysian developer <a href="https://www.apartments.com.au/developers/s-p-setia">SP Setia</a> is the latest to jump into St Leonards booming Transport Oriented Development precinct.

The developer, which has previously delivered Sapphire by the Gardens apartment development in Melbourne, identified the Atchison Street site in 2023. It filed a Scoping Report around 12 months ago, and now has revealed the designs for the new&nbsp;40-storey mixed-use tower.

The State Significant Development Application covers <a href="https://next-portal.urban.com.au/projects/14650/summary">20-22 Atchison Street</a>, a 1,374 sqm site positioned between St Leonards Station and the new Crows Nest Metro station.

Designed by <a href="https://www.apartments.com.au/architects/cox-architecture">COX Architecture</a>, the project would deliver 181 apartments, above a four-storey commercial podium, five basement levels, and new public domain works along Mitchell Street. The apartment mix comprises 35 one-bedroom apartments, 39 one-bedroom-plus-study apartments, 85 two-bedroom apartments, and 22 three-bedroom residences.

The proposal has been lodged as a shop-top housing development under the NSW Government’s TOD planning pathway, which allows increased density around key transport infrastructure. The site sits within the recently rezoned Crows Nest Accelerated TOD Precinct.

<img alt="First look: SP Setia targets St Leonards skyline with 40-storey TOD tower" data-entity-type="file" data-entity-uuid="b799673d-48e2-46b0-801a-0e33a9330100" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/atchinson%20site.png?VersionId=dPh0UfwfaHpbFL1R7H1cbZNbIW0CHbCC" />

SP Setia acquired the Atchison Street site as part of its continued expansion into the Australian apartment market. In comments made to City &amp; Country (The Edge Malaysia) in 2023, SP Setia President and CEO Datuk Choong Kai Wai described the acquisition as “a strategic move” aligned with the group’s post-pandemic market recovery strategy.

“Our target for this exceptional development is local and overseas buyers, including first-home buyers, downsizers and investors,” Choong said.

The tower has been designed as a slender vertical form rising from a mixed-use podium, with COX Architecture positioning the development as a response to the evolving St Leonards and Crows Nest skyline.

“The purpose of the project is to facilitate the delivery of high-quality housing at a strategically located site and deliver a built tower outcome that is consistent with the desired future character of St Leonards and aligns with the TOD controls,” the design report stated.

<img alt="First look: SP Setia targets St Leonards skyline with 40-storey TOD tower" data-entity-type="file" data-entity-uuid="b1a85eee-76f7-436c-a6da-73ba827b9b13" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/atchinson%20entry.png?VersionId=dA9jHGPMcm.dDbwk4QfxqWiY5bfh3UVt" />

The podium would incorporate retail uses fronting Atchison Street, commercial tenancies, landscaped communal areas, and pedestrian improvements along Mitchell Street. Vehicle access and loading would be consolidated via Atchison Lane.

Residents would have access to more than 665 sqm of communal indoor and outdoor spaces, while the development proposes 96 parking spaces across five basement levels.

The proposal also includes a commitment for 10 per cent of residential floor space to be allocated toward affordable housing through a monetary contribution.

COX said the tower form responds directly to the emerging high-density character of the precinct while seeking to maximise solar access, cross ventilation, and outlook from apartments.

<img alt="First look: SP Setia targets St Leonards skyline with 40-storey TOD tower" data-entity-type="file" data-entity-uuid="2163f85c-f63b-4be3-aafa-f8763976cec5" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Article%20Feature%20Image%20%28Grid%29_5.png?VersionId=WiAmtIKJ6.ZQ41EtYEQ1fol7AeorKBlL" />

“The building is orientated towards north,” the Apartment Design Guide compliance report noted, adding that the tower’s slim form was driven by the constrained inner-urban site dimensions.

The design also incorporates landscaped setbacks and communal open space at podium level, intended to soften the interface with surrounding streets and improve pedestrian amenity.

The project adds to a growing wave of redevelopment proposals reshaping St Leonards and Crows Nest following the opening of the Sydney Metro City line and the NSW Government’s push for higher-density housing around major transport nodes.

Last week Stockland filed plans just down the road. They want to build a <a href="https://www.apartments.com.au/new-apartments/601-pacific-highway-st-leonards-nsw-2065">52-storey tower on Pacific Highway</a>.

Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/first-look-stockland-plans-52-storey-538-apartment-st-leonards-tower">First look: Stockland plans 52-storey, 538-apartment St Leonards tower&nbsp;</a>

Joel Robinson

First look: SP Setia targets St Leonards skyline with 40-storey TOD tower

<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.

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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[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

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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Shopping centre giant Westfield Group has this morning unveiled plans to merge its Australian and New Zealand operations with the Westfield Retail Trust to create a new entity and a separate new international group.
The Australian business, to be known as Scentre Group, will be the largest REIT on the Australian Securities Exchange and will have total assets of $28.5 billion, with interests in 47 centres. 
The international arm will become Westfield Corporation and will have total assets of US$17.6 billion, with interests in 44 centres throughout the UK,US and Europe.   Both will be listed on the ASX. 
The restructure will see Westfield Group (WDC) chairman Frank Lowy will chair both new entities.  
"Westfield's international business and its Australian/NZ business have both grown in scale and quality to the stage where they can now stand on their own," said Mr Lowy. "They can each operate more efficiently, and generate growth and value for investors, by being independent."
He said the proposed new structure will allow both companies to "pursue their individual strategic goals and financing plans."  
Under the terms of the proposal, Westfield Retail Trust security holders will receive $285 and 918 securities in the new Scentre Group for every $1000 WRT securities held. The cash payment will be effected through an $850 capital return, equivalent to a pro rata buyback of WRT securities at $3.47 per security.  
WDC security holders will receive 1,000 securities in the new Westfield Corporation and 1,246 securities in Scentre Group for every 1000 WDC securities held. 
WDC and WRT secuirtyholders will vote on the proposal at a meeting in May 2014. 
At 11am, shares in WDC were up about 6.5% or 6x. to $11.04c.
<a href="mailto:news@propertyobserver.com.au" target="_blank">news@propertyobserver.com.au</a>
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kjiminez-eaYKfU7qd2

Westfield Group merging operations to create largest ASX listed REIT

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Australians love affair with online retailing has continued but the pace of growth has slowed and the value of the transactions has shrunk considerably.  
Figures in the latest National Australia Bank Online Retail Sales Index showed that Australians spent $14.4 billion in on retailing in the year to October 2013 - up $2 billion on the same period last year. But sales growth slowed considerably over the past three months, with month to month growth of just 0.3% in October, and the year-on-year rate at 10.6% - the second lowest after August 2013. 
However, it was the analysis beyond the headline number which was the most compelling and the findings are significant as we head into the crucial Christmas trading period.  
NAB’s analysis revealed that almost 90% of all online transactions in the past year were for products under $100. That compares to less than 3% of transactions with values of over $250 and just 0.2% of online sales were for purchases over $1,000. 
NAB Chief Economist Alan Oster said “retailers cutting prices to build sales volume, changes to shipping arrangements and a significant increase in people purchasing low cost media products like e-books, movies and music online are factors driving the lower transaction sizes.”
“While areas like homes and appliances and fashion have seen declines in the average transaction size, the groceries and liquor, and personal and recreational goods sectors have experienced an upward trend since early 2010.” 
Since January 2010, the average online transaction size has also fallen from $64 to $41 in October 2013. 
On what all this means for the GST debate around lowering the threshold, the NAB report found that in the year to October 2013, international online retail sales were around $3.9 billion, with almost 90% of those transactions below $100 in value. 
"Our calculations show that had a lower GST threshold been set over the past year, it would have yielded additional revenue of $42 million at a $500 limit, $210 million at a $100 limit, and $309 million if the threshold was $25", it said.  
Mr Oster said that the special report demonstrated that not only were the majority of online purchases in the very low value range, in fact 49% of all online purchases were below $10. “Transaction sizes for international retailers in particular have fallen quite dramatically over the last three years. Between January 2010 and October 2013 average purchase size dropped from $74 to $38.” 
But he emphasised that the drop wasn't equal across all sectors.
Looking at the spending pattern of the various states, it said that on a per capita basis, the ACT, Northern Territory and Western Australia continue to record stronger levels of consumption, while South Australia, Victoria and Queensland lag behind. 
The biggest spenders were aged between 35 to 44.
<a target="_blank" href="mailto:news@propertyobserver.com.au">news@propertyobserver.com.au</a> 
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Australia's love affair with online shopping continues, but growth is slowing

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With housing finance more available it's no great surprise that new Australian Bureau of Statistics housing finance data shows increased investor activity in the Australian property market.  It's a good time to buy an investment property, but it is important to be sure it will pay its way.
A good starting point is to consider the rental yield – that is, a property's annual rental as a percentage of the purchase price.  So, for example, a property costing $300,000 and renting for $9,000 a year would have a gross rental yield of 3%.  Generally, the higher the rental yield the better the property's return.
While the right house in the right suburb can bring a good rental yield, REIV sales and rental data over the 12 months ending September 2013 show that the highest rental yields are usually for one-bedroom or two-bedroom apartments.  In fact, the top three investment options in Melbourne are all for one-bedroom apartments.
The average rental yield for a one-bedroom apartment in Melbourne is 5%.  For a two bedroom apartment it is 4.4%.  But buying a carefully selected apartment in an in-demand suburb can mean a yield far exceeding the average.
Melbourne's top investment option is a one-bedroom apartment in the popular inner city university suburb of Carlton, with its current return an average gross rental yield of 8.3%. But it is not always the inner-city which brings the highest returns – illustrating a the importance of research.
The REIV data shows Melbourne's second best investment option  for the 12 months is affordable outer suburban Noble Park at 7%, where the median price of a one-bedroom apartment is just $155,000. So, three could be bought for the price of just one in Melbourne city, where the median was $481,500, offering the third-highest yield at  6.5%.
 
<hr>
 Enzo Raimondo is CEO of the <a target="_blank" href="https://www.reiv.com.au/" rel="nofollow">Real Estate Institute of Victoria</a>.
All this information and much more detail is available free on the REIV's regularly-updated website.  Go to <a href="https://reiv.com.au/Property-Research/Bedroom-Medians"></a><a href="https://reiv.com.au/BedroomMedians" target="_blank">reiv.com.au/BedroomMedians</a> to find bedroom medians, median rents, yields and capital growth data. 
 
 
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enzoraimond-7fvRFHPR52

Narrowing down the best apartment investment in Melbourne

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Net asset value (NAV) and net tangible assets (NTA) are two common valuation metrics of Australian real estate investment trusts (AREITs). NTA is the balance sheet or book value of the underlying properties held within an AREIT. NAV is an analytical valuation of an AREIT based on the expected net cash flows from the property assets and profits generated from activities unrelated to income generation within the AREIT structure. These activities include operational businesses, such as funds management or property development.  
The degree that an AREIT is trading at a premium or discount to NAV and/or NTA, serves as a yardstick for assessment of the whether the AREIT is undervalued or overvalued.    
Rental income AREITs v AREITs with operational businesses  
A rental income AREIT, such as Westfield Retail Trust (WRT), derives the vast majority of its revenue from rental income. This compares with Westfield Group (WDC), which generates rental income and undertakes operational businesses such as construction, funds management, property asset management, leasing and marketing activities.  
Chart one illustrates the premium/discount to NAV and to NTA that these AREITs have traded at over three years to October 31, 2013.  
Chart one – Premium/Discount to NAV and NTA comparison
<img src="/images/stories/2013/12/04/binesh_dec_4_chart_one.png" alt="binesh_dec_4_chart_one" width="470" height="185"> 
 
*Inception – 13 December 2010
Source: UBS, Atchison Consultants  
WDC has been trading at substantial premiums to NTA since September 2011 which is attributable to the expected profits generated from the operational businesses within the group.  
However, WDC has been trading closer to its NAV, which accounts for expected market value of the assets of the properties and profits from operational businesses.  
Pricing relative to NTA and NAV  
The premium/discount to NAV and to NTA that the sector is valued at as at 31 October 2013 is shown in Chart two
 
Chart two – AREIT Sector– Premium/Discount to NTA and NAV as at October 31, 2013
 <img src="/images/stories/2013/12/04/binesh_dec_4_chart_two.png" alt="binesh_dec_4_chart_two" width="470" height="250">
Source: UBS  
Over the last 18 months, prices of AREITs have been driven upwards by investors looking for high cash dividend yield investments, within a prevailing low interest rate environment.  
As shown in chart two, as at October 31, 2013, the AREIT sector was trading at premium to NTA of around 23% and at a minimal discount to NAV of 1.5%.  
WDC, which accounts for approximately 25% of the value of the AREIT sector, skews the overall sector’s valuation. The AREIT sector, excluding WDC, was trading at a premium of around 13% and 1.7% to NTA and NAV respectively as at October 31, 2013.  
As shown in chart two, as at October 31, 2013, AREITs such as Westfield Retail Trust (WRT) Investa Office Fund (IOF), Challenger Diversified Trust (CDI) and GPT Group (GPT) have been trading at discounts to both NTA and NAV. These AREITs are undervalued by the market.
 
<hr>
 Binesh Seetanah is an analyst at <a href="https://atchison.com.au/" target="_blank" rel="nofollow">Atchison Consultants</a>.
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How to decide if a REIT is undervalued

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With Australia’s capital cities being home to some of the world’s most expensive rental properties, it is no surprise that overcrowding is a serious problem that many investors face. This is a serious problem in many Australian capital cities, as housing costs increase and supply of affordable property fails to meet demand levels.

Overcrowding of apartments, houses, and other property types occurs for a plethora of reasons. Some of these are profit-driven, others more situational and/or socio-economic. Whatever the reasons a tenant has for overcrowding a property they are renting; landlords suffer the ramifications of this.

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Just about everyone has heard a story or has been directly involved – perhaps as a landlord – in a property overcrowding situation. I’ve heard so many horror stories here in Sydney from friends, colleagues, and readers about overcrowded apartments. One friend, a fellow investor; discovered that after six months of a 12-month lease; his three-bedroom apartment was being permanently occupied by nine adults.

Many Australians who have ever lived in inner-city areas have heard stories like ‘that apartment on the other side of my building back in my uni days that only had two bedrooms, but had eight people sleeping on mattresses in it!’.

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Some investors may have a mindset of ‘So long as the rent is being paid, I don’t care what happens in the property’. However, savvy investors know why overcrowding must be stamped out, otherwise they can be personally liable. Here’s why and how overcrowding can hurt investors:

Fire safety

-          Say you have say a two-bedroom apartment and you rent it out to just one or two people, whose names are on the lease. If there is a fire where injuries, or worse, fatalities occur, and the investigation reveals that several adults were occupying in the property at the time, insurances are likely not to be paid out.

-          This results in oftentimes crippling losses for the investor, as they are forced to either repair and renovate the apartment at great expense; or sell the apartment at great loss in order to consolidate their losses.

Property damage

-          A less severe but just as important consequence of overcrowding is property damage. This is worse for landlords of houses, however unit and townhouse investors can still suffer. I’ve heard of horror stories for house investors where tenants have ripped down walls, or added their own walls to create more bedrooms to fit more people.

-          With so many people living on top of each other in cramped spaces, carpets, walls, and appliances will get warn out much faster than regular properties.

I dug a bit deeper to find out the major reasons why properties in Australia, and in particular, in inner-CBD located properties, are prone to overcrowding:

Poor housing affordability

-          This is a huge issue not just for Australian-born citizens, but those who are new to the country, as well as international students.

-          Share houses and apartments are becoming increasingly popular in middle to outer-ring suburbs to help curb affordability issues. This is happening not just with the ‘young student’ population that most would imagine would live in this way, but with young professionals, and even mature friends living together to keep costs down.

-          However in the CBD areas, the rarity of three to four bedroom properties that can be affordably shared, means that smaller apartments can suffer overcrowding as a way to keep costs down for renters.

Proximity to centralised transport nodes

-          Those who are new to the country are also less likely to drive a car, and combined with the desire to live in the heart of a CBD or close by, to allow them to be close to work, whilst still affording the expensive rent, sharing a room in an overcrowded apartment or boarding house may be the most viable option.

-          This is also related to time efficiency. Those new to the country or international students are sometimes working two or more jobs, and this means they don’t have the time to waste on commuting from cheaper, outer-ring suburbs. Instead, it is more ‘efficient’ for them to live within minutes’ walk to the best-paying job prospects; and these are usually located close to CBD areas.

Illegal profiteering

-          Unlike the abovementioned reasons, this one is more sinister, and highly illegal. Some profiteers ‘prey’ on those who either cannot get a lease of their own, or are new to the country and there are language or other barriers that prevent them sourcing a property legitimately. This unfortunately includes illegal arrivals to the country.

-          These people will rent out large apartments and houses in prime locations from real estate agents, and then then illegally sub-let the property for profit, overcrowding the rooms as much as possible.

-          For example; a ‘tenant’ may pay $800 per week to rent a four-bedroom, well-located apartment, but may fill each room with two or more beds, and charge $150 per bed, per week, turning a profit weekly from the revenue

So what can you do to prevent overcrowding, and how can you tell from the outside if a property has too many occupants?

Get the best managing agent money can buy

-          A highly competent agent will never allow overcrowding to occur. This happens because they are conducting regular routine inspections of your property.

-          However, the best agents are almost like detectives for that. An overcrowded property; with enough notice period prior to a routine inspection, can be made to ‘appear’ it is not overcrowded, however savvy managing agents will be on the lookout for any evidence that the property is being occupied than more adults than those listed on the lease.

Be aware of strata by-laws in your state or territory

-          How many people is too many, in a property? You need to investigate what the strata by-laws are for units and apartments in strata-managed properties; as well as what the law states for houses that are not part of any strata management.

-          There are mild variances from state to state. For instance, in NSW, where overcrowding is a severe problem due to weak affordability for renters, strata-managed building now stipulate no more than two adults per-bedroom, per-apartment. This means in a one bedroom apartment, only two adults are allowed.

Tenant screening in the beginning

-          Ensure that the applicant(s) you choose to allow to rent your property have been properly screened by your managing agent.

-          If you have any doubts, it is appropriate to ask to see references and/or a tenant ledger history from your agent. Red flags to look out for include a history where the tenant(s) have not stayed in one property longer than a year (over a long period of time), or of course any black marks against their name in their rental history (such as reports of damage, tribunal hearings, and so on)

Local council and student council awareness programs

-          To help prevent international students being taken advantage of, by illegal profiteers, most CBD campuses of universities around Australia give information about overcrowding as part of student orientation and on boarding processes. This helps to prevent students being taken advantage of.

-          Local councils in densely populated local government areas also investigate reports of overcrowding. If you suspect neighbouring properties near where you live, or where friends live, are overcrowding the rooms, it is best to report them.

-          This in turn helps to combat the issue head-on. The knock on effect is then a more spread out human population throughout capital cities, and this is good for the health of all residents in big cities, because city resources and services are more evenly and fairly distributed for use to all occupants.

Have your agent ask the neighbours

-          As an investor, it is hard to keep an eye on your place when you are not actually living there yourself. This one comes back to having a good agent on board. If there is suspicion that a property is overcrowded, ask your agent to check things such as:

<ul>
<li>
	Neighbour observations. If neighbours notice lots of people regularly coming and going from the property, this could be an indicator.
	</li>
	<li>
	Rubbish share. If the property is a unit and is producing ridiculously high volumes of rubbish contribution to the shared bin areas, this is another indicator. With houses, asking neighbours on rubbish volumes is also a possibility.
	</li>
</ul>
As an investor it is vital to protect the financial prosperity of your property, and overcrowding is one of the nasties to be conscious of. Knowing how to detect if it is happening in your property; what to do if it occurs, and the potential legal consequences of not doing anything about it is an important piece of the investor success puzzle.

 

<hr>
Cameron McEvoy is a NSW-based property investor and maintains a blog, <a href="https://www.propertycorrespondent.com.au/" rel="nofollow" target="_blank">Property Correspondent.</a>

 

 

 
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Overcrowded properties: Why it happens and how to stop it

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It was reported recently in October 2013, the NSW state government made the largest monthly windfall on stamp duty since it began recording such data trends back in 2005.
With over $350 million collected in the month of October, stamp duty is unquestionably one of the biggest revenue raisers for NSW.
However, we shouldn’t get too carried away with what, at face value, appears as a larger than usual money-grab by the state government. The increase in stamp duty revenue also needs to take into account some other market factors, such as near-record high auction clearance rates for the months of August, September, and October of 2013. It is within these two to three months that the state government’s stamp duty tax windfall reported, would have been derived from.
It is safe to call a spade and spade and realise that in NSW, higher than usual auction and private sales data – and thus higher volumes of stamp duty collection as a result – is an indication of renewed buyer and market interest in residential property.
And hey, why wouldn’t there be?
The current property market climate has been something of a perfect storm for home buyers and investors alike in recent months. This is especially evident in NSW. Though housing affordability challenges continue to persist, there are just too many well-received positive factors at play that are stirring home buyer and investor market activity. These include:
-          Some of the lowest interest rates on offer of all time
-          Not only are rates low, but some of the most competitive and cost-efficient two-year, three-year, and five-year fixed interest rate deals are on offer. These deals are ‘security’ music to a first home buyer’s ears
-          Though affordability remains a challenge, property values throughout most of NSW have not risen in as high a proportion as other states in the past 12-24 months
-          Previously the construction industry was in a slump, however it is starting to heave back into prosperity and with more construction upstarts and projects commencing, buyer confidence levels boost
As an investor, my view on stamp duty is in a constant state of flux. Though it prohibits many first home buyers from entering the market initially, it can be argued that it also prevents first home buyers entering the market foolishly and setting themselves up for failure. Yes, saving that initial first home deposit will take a little longer due to the needed stamp duty capital being raised, however it also means buyers need to learn more diligent saving and spending habits in their quest to home ownership.
This can be a good thing for buyers who have unrealistic expectations or a view that their first home purchase should be the ‘forever dream beach house’ that they want, long term. First home buyers need to view stamp duty as a challenge; a necessary evil that means they may need to compromise on certain elements of their first property purchase.
Stamp duty also encourages would-be first home buyers to consider renting longer, and perhaps buying a more affordable investment property to start with, saving first home ownership for a few more years down the track. I personally think this is one of the smarter and more cost-efficient strategies out there.
Say for example your goal is to buy your first home, a $500,000 property, within the next few months and you have your 15% deposit saved. Here’s what you’d be up for if you bought it as a home and lived in it for three years:
-          15% deposit: $75,000 (leaving a mortgage value of $425,000)
-          LMI (Lender’s Mortgage Insurance) because you do not have the needed 20% deposit: around $4,000 (that’s $4,000 of wasted money you can never get back or make any claims on)
-          NSW stamp duty on purchase of $500,000 (payable at time of settlement, remember): $18,010 (yes, that is dead money you can never get back)
-          Other settlement costs (legal, any loan fees, searches): $2,000
-          Total upfront payable: $99,010
Assuming you take out a mostly-fixed loan product (say 30 years), two to three years of chipping away at the mortgage will not make much of a dent, because remember, most 30-year mortgages do not start to make headway until around year #5 or #6. You are also liable to pay hefty interest on your mortgage from day one, because of a substantial $425,000 sized mortgage.
In my view, a better strategy for this home buyer is to rent for a few years, but buy a cheaper investment property up front. Let’s say a modest unit or apartment in middle-outer Sydney suburbs, or a well-located property in a regional centre such as Wagga, Newcastle, or the North Coast. Let’s say you still have that $99,000 upfront budget mentioned above to spend.
-          Buy one $250,000 investment property right away
-          Put down 20% deposit (thus negating the need to pay LMI): $50,000
-          This means you have a loan amount of $200,000. I’d take out a split loan that is 60% fixed for three to five years, and 40% variable (with an offset facility that is redraw-capable). This means 40% ($80,000) of your mortgage is offset-capable
-          NSW stamp duty on $250,000: $7,260
-          Other settlement costs (same as above): $2,000
-          You are ‘all in’ for $59,260 initially
-          As for the remaining $30,000 of savings, don’t spend it, but put it into that $80,000 offset account. This means that for the first few years you are only paying interest on $50,000 of offset plus 120,000 of fixed loan = interest payable only on $170,000
-          Over years one to three you continue to rent and pour savings into that offset account, all the while reducing the interest you pay on the investment property. Then in year three, you pull out your original $30,000, plus three years’ worth of savings revenue. Assuming you save an average $20,000 per year, this will see you back at the $90,000 mark to buy your home with.
-          Oh and let’s not forget some of the tax minimisation benefits that often come with well-purchased investment properties. Even if this saves you only a couple of thousand per year, that’s still an additional $2,000 each tax year that will help to ease the mortgage stress of your big chunky home mortgage, when you are ready to buy your home.
This strategy will not work for everyone or every situation. It is not financial advice and is not to be construed or applied as such. However, it is an example of how renting for a few more years whilst having an investment property up your sleeve, can better your home-buying position later on.
Stamp duty is one of those necessary evils in the property game. It may not always be, but for now, it is. In my view, though stamp duty is an evil, it is not the real problem here – a poor buying strategy mixed with unrealistic buying expectations is. Australian property buyers need to get smarter in their home ownership aspirations and realise that the best course to take isn’t always the direct one.

<hr>
Cameron McEvoy is a NSW-based property investor and maintains a blog, <a target="_blank" rel="nofollow" href="https://www.propertycorrespondent.com.au/">Property Correspondent.</a>
 
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The best course to home ownership is not always the most direct one 

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Australian retail turnover increased 0.5% in October, following a rise of 0.9% in September, according to the latest Australian Bureau of Statistics figures.
Turnover in the cafes, restaurants and takeaway food category recorded the biggest rise, jumping 1.2% for the month.
Food retailing in general increased 0.5%, while clothing, footwear and personal accessory retailing was also up 0.6%.
These gains were partially offset by a 0.3% fall in department store spending.
On a state basis, Tasmania and the Australian Capital Territory recorded the biggest gains, jumping 1.3% and 1.4% respectively.

<hr>
This article first appeared on <a target="_parent" href="https://www.SmartCompany.com.au">SmartCompany</a>.
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Retail spending lifts in October

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When it comes to owning an investment property, investors tend to put most of their efforts towards selecting the asset, financing it and negotiating the purchase. After they buy, they attend to day-to-day issues like tenant selection and property maintenance, but seldom take the time to review the performance of their asset and assess whether it’s doing the job they need it to do.
Ideally, residential investment property should be held for at least seven to 10 years to ride out market fluctuations and maximise compound capital growth. However, each property performs differently—and not all of them perform at a rate that justifies their long-term inclusion in your portfolio. For this reason, it’s essential to review your property’s performance every two or three years and make the necessary adjustments if it falls short of the mark.
How do you evaluate whether your property is producing the goods—and what should you do if it isn’t?
The best way to find out whether your asset is up to scratch is to determine whether it is growing in value at a faster or slower rate than the median. To do this, ask a couple of local real estate agents for an appraisal of the property’s current market value. Divide this figure by the purchase price and subtract one to work out the percentage increase for the total holding period.
Then, find out the current median value in the city the property is located, along with the median for the year you bought the property. Divide the current median by the older median and subtract one to work out the percentage increase for the holding period.
If you want to take things a step further, you can compare your property’s growth rate with the growth rate for your suburb. Be aware that the small number of properties sold in some suburbs means that a few exceptionally strong sales results can skew the median figure. For this reason, the city wide median should be your primary benchmark.
If its growth rate is higher than the median growth rate, you know it’s earning its place in your portfolio. Sit tight and review its performance again in two or three years’ time.
If its growth rate is lower than the median, there’s a reasonable chance that this trend will continue. At this point, you need to put emotion aside and look at your investment with a critical eye. Is it worth holding on to your asset in the faint hope that ‘things will turn around’, or are you better off selling it and putting the proceeds into something that will work harder over the long term?
If your property’s performance is pretty much level pegging with the median, you’re in somewhat of a grey area. Here, it may be helpful to consider how much longer you’re intending to hold the property. If you’ve already held it for seven to 10 years and only plan to hold it for a couple more, time is working against you because transaction costs like agent’s fees, advertising expenses, capital gains tax and stamp duty will eat substantially into your profits. In this case, it’s probably appropriate to sell it in two years’ time as planned.
On the other hand, if you’ve only owned the property for a few years and plan to hold it for the long term, time is on your side. It may be best to sell it now and reinvest your money in an asset that will work harder for you.
When you’re assessing your investment property’s performance, it’s also a good opportunity to evaluate your financing arrangements. The residential loan market changes constantly, so reviewing your loan structure, interest rate and fees could save you a substantial amount of money, freeing up funds which you can put towards reducing your debt.
By taking the time to crunch the numbers every so often, you’ll be in a better position to make an objective assessment about whether your property is holding its own, or whether it’s best to sell up and put your investment dollars into something that will truly deliver.
 
<hr>
 Mark Armstrong is a director of <a href="https://www.ipropertyplan.com.au/">iProperty Plan</a>, which provides independent analysis and tailored advice to investors and home buyers.
 
 
 
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Knowing when to sell your investment property

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The great migration back to the Melbourne CBD is on.
Fresh research from Jones Lang LaSalle has revealed a notable lift in the number of city fringe occupiers moving back to the Melbourne CBD over the past 12 months. Data from the paper recorded16 "centralised" transactions of more than 1000 square metres, compared with just three over the previous 12 month period.
Another measure was net absorption. In the year ending Q3/2013, JLL said, Melbourne CBD recorded positive net absorption (8,380 square metres) compared with negative net absorption (- 32,550 square metres) in the city fringe.
<img src="/images/stories/2013/12/03/chart_of_the_week_dec_3_one.png" width="470" height="275" alt="chart_of_the_week_dec_3_one">
Driving this migration back to the CBD, said the JLL Pulse report paper was a combination of higher incentives available in the CBD and narrowing of the rental spread between the CBD and decentralised markets which had "accelerated a wave of centralisation".
Another factor it cited was the limited new supply in the city fringe market, along with the significant shortage of contiguous space across. Only 11 prime grade options are available above 1,000 square metres, compared with 39 in the CBD.
The city fringe locations were identified as West Melbourne, North Melbourne, Parkville, Carlton, East Melbourne, Richmond, Abbotsford, South Yarra St Kilda, and Port Melbourne.
<img src="/images/stories/2013/12/03/chart-of-the-week-dec-3-two.gif" width="470" height="287" alt="chart-of-the-week-dec-3-two">
The paper also made a point of saying that there was increasing demand from decentralised occupiers for "quality, well presented stock - driven by cultural change, cost savings, business contraction and expansion activities, and changes in the way people are working." Specifically, it said companies were increasingly seeking enhanced corporate identity through location - connectivity to the CBD, which offered firms closer proximity to clients and competitors.
JLL looked at a number of themes in its report on centralisation. One was the question of cost. JLL said that since 2008, it has recorded 42 major tenant moves (1,000 square metres plus) by occupiers moving into the CBD from decentralised locations. Its analysis showed that 85% of those occupiers had relocated to the periphery of the CBD, with very few locating to the core CBD itself.
But at the same time, it points out that increasing vacancy rates have exerted upward pressure on incentives, notably in the CBD. Over the past 12 months, average leasing incentives increased from 24 months’ rent free (20%) to 35 months’ rent free (29%) - above peak levels recorded during the GFC and currently at their highest level in 17 years, it added.
As such, "city fringe occupiers are increasingly looking at upgrading from lower grade assets and taking advantage of competitive rental terms", JLL said.  "Occupiers are seeking space with a generous fit-out incentive or an attractive turn-key solution which allows them to upgrade from their current accommodation."
Based on its assessment of average rent free periods (based on 10-year term) across a basket of grade A assets in the CBD and city fringe precincts, the average rental spread between gross face rents in the city and city fringe is about 25%.
However, taking into consideration the higher incentive levels offered in the CBD compared to the city fringe, JLL calculates that the average spread on an effective rent basis narrows to 12%. This spread becomes even more acute when comparing submarkets within the CBD and city fringe markets.
Looking out, JLL said believes that a lack of development activity and limited contiguous options for large space users in the city fringe combined with higher incentives available in the CBD will "continue to drive centralisation and support Melbourne CBD demand in the short term." While a number of medium-term lead indicators have started to improve and point towards a demand recovery in the Melbourne CBD.
"A reactivation of business investment projects will have a positive impact on white-collar employment, supporting our forecasts of above trend net absorption in the Melbourne CBD projected for 2016 (75,000 square metres) and 2017 (110,000 square metres)."
<a href="mailto:news@propertyobserver.com.au" target="_blank">news@propertyobserver.com.au</a>
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The great migration back to Melbourne CBD office space is on: JLL

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One of oldest clichés in journalism is that they never let the facts get in the way of a good story. And we’re seeing that shallow principle in play daily as media hammer the myth that first-home buyers are being squeezed out of the market.
All the available facts say otherwise.
Last week two new reports were added to the great pile of evidence that affordability is particularly strong right now. Some of the regular indexes have affordability at its best in 10 years. The one published quarterly by the Commonwealth Bank and the Housing Industry Association showed further improvement in the September quarter, with all capital cities benefiting.
Financial ratings firm Canstar published research showing that while the national average mortgage is today four and a half times bigger than it was in 1990, affordability is much better today than then because interest rates are much lower and wages have risen. Repayments as a proportion of income are considerably lower than they were in 1990.
We can add that to the ABS report which found that average house prices, relative to average incomes, are today at the same level as they were in 1995; and to the affordability index published by the Adelaide Bank and the Real Estate Institute of Australia, which basically concurs with the Commonwealth Bank report.
The thing that appears to conflict with all that evidence is that first home buyer numbers are low at the moment. Far too many attention-seekers are leaping to the erroneous conclusion that the only possible explanation is that young people cannot afford to buy.
The real explanation has nothing to do with affordability. It has to do with choices. Many recent surveys have found that today’s twenty-somethings are not prioritizing home ownership the way previous generations did. They are opting for lifestyle and travel. Home ownership can wait.
The surveys indicate many young adults prefer to rent in an inner-city suburb rather than moving to the suburbs and taking on a mortgage. Some are renting in the city while getting on the property ladder by buying an investment property in a cheaper location, often a regional centre.
It’s a major demographic shift, similar to the one that has Australians delaying parenthood. We no longer live in a nation where young adults move automatically to marriage, children and a suburban mortgage.
But someone seeking a bit of media limelight can always generate some cheap publicity by declaring the ‘Great Australian Dream’ dead. Media will always run that and in a nation of 23.3 million people you can always found a twenty-something malcontent willing to have a public whinge about how hard it is to save a deposit.
Journalists seem to think we’re all desperate for news about the sad plight of the wannabe first home buyer. They apparently imagine Australians are gathered in pubs and homes across the country talking about nothing else. What else could explain their obsession for this story line?
I have to confess I’m not interested in first home buyers. Even at their peak they have never been a major force in real estate and their importance to the property market and to the nation is greatly over-rated.
Buying a first home today is what it has always been: really hard. It’s a massive commitment and you have to really want it. It takes compromise and sacrifice. If you want it badly enough, you’ll go get it. It has always been thus.
The nation offers everyone shelter. But no one has a divine right to own the shelter. And certainly no one has a right to achieve ownership in their dream location as a first purchase.

<hr>
Terry Ryder is the founder of <a rel="nofollow" href="https://www.hotspotting.com.au/" target="_blank" style="font-size: 14px;">hotspotting.com.au</a> and you can contact him via <a target="_blank" href="https://mailto:%20ryder@hotspotting.com.au">email</a> or on <a target="_blank" href="https://twitter.com/hotspotting" style="font-size: 14px;">Twitter</a>.
 
 
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