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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A major refurbishment of the Merrimac Shopping Village on the Gold Coast has seen it secure blue-chip supermarket chain IGA as tenant to the suburban shopping centre. 
IGA operators Brian and Kathy Bicknell secured a 289 square metre retail outlet in the centre on a 5 x 5 x 5 year lease term. The net rental was about $212 per square metre per annum.
Ray White Commercial Robina’s Steve Jeffery negotiated the lease and has been appointed as exclusive leasing agent for the shopping village.
Mr Jeffery said the owners of the shopping village have invested in a major refurbishment of the shopping village and neighbourhood centre and that the market repositioning was paying off, citing the recent launch of the Bakery and Coffee shop in the centre.
The shopping village has a net lettable area of about 1,003 square metres in 11 shops.
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kjiminez-eaYKfU7qd2

IGA in the bag for Merrimac Shopping Village refurbishment

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Strong owner occupier demand for office space in Melbourne's CBD has seen two strata suites on Queen Street fetch record prices.
The two 62.2 square metre suites, at 2 Queen St, were sold together for $488,270 plus GST, translating to $7,850 per square metre.
At $7,850 per square metre, said DTZ selling agent Danny Clark, the result was well above historical results in the 2 Queen Street building, "with the most recently sold suites being purchased for $6,380 per square metre and $6,200 per square metre respectively ".
Mr Clark said the sale of those two suites continued the trend of owner occupiers paying a premium for quality strata buildings in the heart of the Melbourne CBD.
<img alt="queen_street_sept_25_onew" height="337" width="470" src="/images/stories/2013/09/25/queen_street_sept_25_onew.jpg">
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Record price recorded for 2 Queen Street, Melbourne office strata

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A position paper setting out reforms to the 1989 Home Building Act was released yesterday by fair trading minister, Anthony Roberts.
Created to address some of the unnecessary complexities for New South Wales, that had been causing disputes between homeowners and builders, so far there has been a positive reaction from the industry to the proposed reforms.
“In July last year the Government released an Issues Paper Reform of the Home Building Act for consultation and more than 600 responses were received," said Roberts.
After 15 months of consultation with industry, building groups and community, the proposed reforms cover a number of aspects of home building legislation. Dispute resolution, statutory warranties, home building contracts, owner-builders' obligations, home warranty insurance and licensing are all covered.
Roberts said that the aim was to provide regulation and protection for homeowners, while supporting building activity and investment in NSW.
Master Builders Association NSW executive director, Brian Seidler, said that the reforms are a good foundation and highlighted a few of the standout changes.
"By providing a clear definition of what constitutes a major defect, the Government is ensuring that clarity and certainty are introduced into the home building sector," said Seidler.
"Lifting the general works contract threshold from $5,000 to 20,000 will remove unnecessary red tape for smaller jobs."
The allowance of a termination clause was also said to be a good way to ensure obligations between builders and home owners are clear.
Housing Industry Association NSW executive director, David Bare, was similarly positive about the changes.
Bare said that the reform had been undertaken with the industry in an open and transparent manner.
Urban Tasforce CEO, Chris Johnson, has also put his hand up in approval of the proposed reforms.
“Too much time and money is currently spent on litigation between owners corporations and developers in the resolution of defects that can be better spent on ensuring houses and apartments are well built and managed,” said Johnson. 
“Most building contracts have a sum of money retained to cover the resolution of defects that can become apparent as a building is used and weathers and clearly the builder needs to ensure that any defects are quickly rectified. Unfortunately disputes have developed over the rectification of defects and the reforms now reduce ambit claims, require homeowners to give builders access to make rectification and require homeowners to notify defects early. These are all changes that can lead to a better relationship between all parties.”
You can read the review of home building legislation <a href="https://www.fairtrading.nsw.gov.au/ftw/About_us/Have_your_say/Review_of_home_building_legislation.page?DCSext.ref=HomePageClick:Whats_new" target="_blank">here on the Fair Trading website</a>.
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jduke-EHk3XBmHkn

Home building reforms to provide industry clarity

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When you look at the two properties below what differences do you see?
<a href="https://www.realestate.com.au/project-ella+apartments-vic-south+yarra-600000699" target="_blank">Ella Apartments, South Yarra</a>
{yoogallery src=[images/stories/2013/09/25/south]}
<a href="https://www.realestate.com.au/property-apartment-vic-hawthorn-114443879" target="_blank">9/2 Hotham Street, Hawthorn</a>
{yoogallery src=[images/stories/2013/09/25/haw]}
On the surface they are obvious in that one is brand new in a high-rise building while the other is old and in a smaller block.
However from a property investors point of view the major differences are not the psychical attributes of the properties but more in the way they are marketed and sold.
During the last investor fuelled property boom incentives such as stamp duty savings, depreciation benefits and rental guarantees were the main marketing tools used to help sell property. However this time around many investors have woken up to these tactics so the marketing has become more imaginative.
Property investors are being lured into buying apartments in the property on the left with<a href="https://www.propertyobserver.com.au/victoria/vespa-offer-to-entice-buyers-to-south-yarra-one-bedroom-apartments/2013071662673" target="_blank"> the offer of a free Vespa</a> or Mini. But these things are not free as they will be paid for in the over all purchase price.
Recently I saw another ad that <a href="https://www.propertyobserver.com.au/news/melbourne-units-sell-with-bonus-qantas-frequent-flyer-points-enough-for-three-return-first-class-flights-to-singapore/2013082864650" target="_blank">offered buyers one Qantas frequent flyer point for every dollar they spent</a> on the property. So if you paid $500,000 on an apartment you would receive 500,000 frequent flyer points, enough to get a couple of people around the world.  For the record you could buy a couple of around the world tickets for around $5,000
While receiving a Vespa or a holiday sounds great the problem with these incentives are they add no ongoing value to the property.
By contrast the Hawthorn property is sold in a completely different way. All the agent had to do was tell people it was available and the market did the rest. When this property went to auction a few weeks ago four bidders attempted to buy it and it sold under the hammer.
The property sold itself because of what it was and where it was and the agents did not have to dress it up with marketing hype.
Alarm bells should be ringing for property investors when they see these kinds of incentives on offer. The value of good investment property is underpinned by psychical attributes such as location, land size, land value and property style.
When looking for an investment it is vital to focus on the things that do not change over time. You cannot lift a house and land up and drop in in a more desirable or handy location a few years after you buy it. Further you cannot change the orientation of the land, the position in the block of apartments or what surrounds the property. Finally you have no control over the supply of new property coming onto the market around you.
Good investment property is often very hard to buy because you are put in a competitive environment, while risky investments are often easy to buy.
My advice? Buy a good property and pay for the toys and holidays yourself.
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 homebuyers.
 
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Beware the new breed of property marketing incentives: Mark Armstrong

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This tweet from ABC News had us fascinated this morning.
<blockquote class="twitter-tweet">
Median rent in America: $871/month. The median emergency room visit: (via <a href="https://twitter.com/ABCWorldNews" target="_blank">@ABCWorldNews</a>) <a href="https://t.co/vC1L8FRbML" target="_blank">pic.twitter.com/vC1L8FRbML</a>
— ABC News (@ABC) <a href="https://www.propertyobserver.com.au/https://twitter.com/ABC/statuses/382609239824293888" target="_blank">September 24, 2013</a>
</blockquote>
Tweeting at 6.55AM, it notes that the median rent in America is $871 per month. The median emergency room visit is at a cost of $1,233 per month.
They've sourced the Agency for Healthcare Research and Quality, and the Census. 
Now I don't know about you, but we think that's pretty intense.
In Australia, the ABS puts our median monthly rent at $1,235 (based on median weekly rent of $285). If you're an Australian citizen, and you have your Medicare card, your care in emergency is covered for free.
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Cost of rent and emergency services

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Two of the more common questions REIWA agents get asked in relation to the buying and selling process are: what happens when there are multiple offers on a property and what is the 48 hour clause?

Let’s look at these separately.

First, when a seller finds themselves in the envious position of having more than one offer on their property for sale, there is no right or wrong procedure in terms of how they might respond to that.

There is no law around this and it’s up to the seller in consultation with their agent as to how to move forward.

In this context it is important to remember that it is always a seller’s right to assume that any offer received from a buyer is their best offer.

If the seller has several offers to consider then they will probably ask the agent to inform the potential buyers that there are multiple offers and that the buyers subsequently have until a specified time to reconsider and then present their best offer.

Alternatively, the seller might decide only to negotiate with one of the offers. That may not necessarily be the highest price as the decision by the seller might also be based upon the least complicated offer. For example, a higher offer that relies on the sale of another property may not interest a buyer who is keen to sell quickly.

The ‘48 hour clause’, now more properly known as the ‘two business day condition’ is a separate issue that buyers might come across.

This clause is normally inserted when the buyer wants to make an offer that is conditional upon the sale of the buyer’s existing property, but the seller wants to continue marketing their property in the hope of receiving an unconditional offer on better terms.

This clause gives the seller the right to continue advertising their property and to negotiate with a possible second buyer.

The second offer might be for a lesser amount but may provide greater certainty for the seller.

If the seller receives an alternative offer that they wish to accept, then they must serve a notice upon the first buyer.

From receipt of that notice the initial buyer then has two business days to secure an alternative source of finance or obtain a contract for the sale of their existing property.

If the first buyer does not waive the condition of selling their own home by the termination of two business days then the contract comes to an end and they get their deposit back.

The seller is then able to enter into the other contract with the alternative buyer.

REIWA provides a standard ‘two business day’ clause for its members to use, however, buyers and sellers are strongly encouraged to fully understand its terms and conditions before agreeing to it.

 

<hr>
David Airey is president of the <a href="https://reiwa.com.au/home/default.aspx" rel="nofollow" target="_blank">Real Estate Institute of Western Australia.</a>This article was originally published on <a href="https://reiwa.com.au/Faq/Pages/Feature.aspx" rel="nofollow" target="_blank">reiwa.com</a>.

Recently listed properties:

[smartcode_project:default project_id=29358]

[smartcode_project:default project_id=27575]

[smartcode_project:default project_id=22584]
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How do I deal with multiple offers and what is the 48 hour clause? David Airey

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It is vital that you find out the prevailing demographics of the location where you are looking at buying.
Is it popular with families or students? Is it a culturally diverse area? Does it already have a high proportion of renters? Is there a high incidence of crime in the area? Are there plans to develop the infrastructure of the location?
All of these can impact on finding tenants for the property, securing a good rental return and further down the track, being rewarded with a decent capital gain when you sell.
Much of this information can be tracked down for free using the ABS census data. Ray White chairman Brian White advises that you consider whether a prospective property would appeal to an owner-occupier or more likely appeal to another investor.
Answering this question will depend on its location, neighbouring properties, type of building and its current occupants.
“If you can imagine it being an owner-occupier, it is likely to offer a significantly better capital growth return. Upward drive in residential values isalways led by owner-occupiers,” says White.
 
<hr>
 This article is from Property Observer's free ebook <a href="http://propertyobserver.com.au/ebooks/free-ebook-top-10-property-investment-tips">Top 10 Property Investment Tips</a>
 
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Check the demographics of the location 

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The property market ebbs and flows over the middle to long term and different forces come into play to cause this.
For example economic growth with low unemployment, low interest rates create the demand for housing which attracts developers to build to meet this demand.
Eventually demand is met and the market reaches saturation as developers may have built too many properties and this causes developers to cease building until the oversupply dries up and demand is there again.  
This may take many years before the tide turns again however it creates the ebbs and flows that are associated with prices moving up and down.  
That was a very simplistic over view of the market. There are many complex dynamics that affects the market as well, the overseas confidence and the Australian dollar.  
One particular area that has not had much coverage but could be a great indicator of the potential movement of property prices is the difference between yields and property prices.  
As demand from investors make up a significant part of property price movements and investors are focussed on returns on investments such as rent yields, we should look at the correlation between rent yields and capital value.  
Let’s see how rental yields dictate where we are in the property cycle 
As rents increase it attracts investors into the property market, especially since the return from fixed interest instruments such as term deposits and other cash investments are considerably low at the moment.  
There is much talk from many economists about the end of the mining boom and predictions of a slowing economy due to China’s slowdown and running into potential head winds with unemployment growing to over 6.5% and economic growth slowing to below 2% per annum over the next five years causing a possible recession on the horizon.  
Whenever economists predict the worst, share investors react first, by cashing in their stocks for safer investments but cash returns are so low that property is the next best group to invest in. So as people hop out of the share market and into the property market, it generates demand for property.  
The other group that drives property prices are owner occupiers.  
Since interest rates on home loans are at its lowest, many people who are renting find it cheaper to purchase, causing a second group of people who drive demand in property.  
The last group that drives property is the supply line. Developers have not been building, where by there is also a shortage of properties.  
Our net immigration of around 250,000 into Australia also drives demand for property.  
Most rental yields are now over 4.2% to 5.2%. Interest rates on home loans are as cheap as 4.85% fixed for three years.  
Research from last month’s RP Data shows, rents have outpaced growth in values since the GFC and created a gap which indicates the conditions are there for the property market to move upwards.  
According to RP Data since the end of 2007, house prices have grown 13.4%percent. For five and a half years, combined capital house prices have been below inflation.  
However over the same period rents have grown 32.1%, almost twice the rate of house prices.  
Refer graph below:
 <img alt="chan_sept_24_chart_one" height="189" width="470" src="/images/stories/2013/09/24/chan_sept_24_chart_one.png">You can see the gap is largest right now which means yields are increasing.  
When yields are so high (namely it’s very expensive to rent) it opens the door for people to buy.  
When people start buying (owner occupiers) it pushes prices up faster than rental increases, thus reducing yields down to normal levels.  
As you know, to calculate yield, one must divide the yearly rent by the value of the property, e.g. rents per week of $500 is $26,000 for the year, divided by the value of the property $450,000 gives a rental yield of 5.78%.
So if property values drop, the yield would increase and should property values increase, the yields would drop, without the rental moving at all.  
The last property boom started when yields were around 6% to 7% and as the property market boomed and the values increased, the yields dropped to around 4% per annum making it more difficult to buy into the property market.
When the yields eventually drop to around 3% due to property growth it will hit a ceiling where the market will no longer tolerate and people will go back to renting and put pressure on rents to rise to a level where it becomes cheaper to buy again and thus the cycle repeats itself.  
Let’s look at city by city  
In Sydney, home values have increased by around 20% since the end of 2007, while rents have increased 35%. The gap between rental and value indicates potential for capital growth.
 <img alt="chan_sept_24_chart_two" height="206" width="470" src="/images/stories/2013/09/24/chan_sept_24_chart_two.png">In Melbourne both rents and capital growth have increased around 20%. This indicates that there is still a way to go before Melbourne is in a position for capital growth.
 <img alt="chan_sept_24_chart_three" height="220" width="470" src="/images/stories/2013/09/24/chan_sept_24_chart_three.png">In Brisbane, house prices have fallen by 3%, and rents have grown 27%. The huge gap between values and rental growth say’s that the high rentals will drag up the values so Brisbane shows a lot of potential.
 <img alt="chan_sept_24_chart_four" height="206" width="470" src="/images/stories/2013/09/24/chan_sept_24_chart_four.png">In Adelaide as well, house prices have grown just 7%, while rents have increased 21% and shows great potential
 <img alt="chan_sept_24_chart_five" height="227" width="470" src="/images/stories/2013/09/24/chan_sept_24_chart_five.png">In Perth, the gap is quite large where home values have only grown 2% since the end of 2007. Rents on the other hand have increased 48%. Perth appears to have the greatest potential for capital growth.
 <img alt="chan_sept_24_chart_six" height="205" width="470" src="/images/stories/2013/09/24/chan_sept_24_chart_six.png">Please be aware that there are many indicators that drive property prices and this analysis is based only on one indicator, but a useful indicator.
 
<hr>
Ed Chan is a founding partner of <a rel="nofollow" target="_blank" href="https://www.chan-naylor.com.au/">Chan &amp; Naylor</a> accountants and a leading property tax specialist.
He has co-authored three best-selling books as a seasoned property investor who understands the relationship between property investment and tax.
 
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Rental yields, where do they indicate we are in the cycle and where should you buy? Ed Chan

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As the cycle moves on and our property markets boom, memories of the last few difficult years will slowly fade.  

However, it would be a pity to have lived through the challenging times many property investors experienced over the last years without learning some lessons so that we are not destined to repeat the pain.  
So what did you learn from the property downturn?  
Probably the most important lesson we can all learn is to never get too carried away when the market is booming, or too disenchanted during property slumps. Letting your emotions drive your investments is a sure-fire way to disaster.  
To ensure you never get caught again, let’s look at five big lessons I’ve learned about property booms in my close to 40 years of investing.  
Lesson one: Booms don’t last forever
During a boom everyone is optimistic and expects the good times to last forever, just as we lose our confidence during a downturn.  
Our property market behaves cyclically and each boom sets us up for the next downturn, just as each downturn paves the way for the next boom. 
Let’s face it; while the news regarding property is positive today, we know that over the next few years the buoyant market conditions will be followed by a property bust and then another boom.
And over the next decade or two we could even have a recession (we haven’t had one since the early 90s) and we’ll most likely have another depression one day.
The lesson from all this is that even as you take advantage of our booming markets, get prepared for the next phase of the property cycle. During the last cycle, most investors didn't really have their downside covered or their upsides maximized.  
Lesson two: Beware of doomsayers
As long as I have been investing I remember hearing people with excuses why property prices will stop rising, or even worse, why property values will plummet.    
However in that time, well located properties have doubled in value every eight to 10 years.  
Fear is a very powerful emotion, and one that the media used to grab our attention. Sadly some people miss out on the opportunity to develop their own financial independence because they listen to the messages of those who want to deflate the financial dreams of their fellow Australians.  
Lesson three: Follow a system
Smart investors follow a system to take the emotion out of their decisions and ensure they don’t speculate.  
This may be boring, but it’s profitable.  
Let's be honest, almost anyone can make money during a property boom because the market covers up most mistakes. But many investors without a system found themselves in financial trouble when the market turned.  
Warren Buffett said it succinctly: "You only find out who is swimming naked when the tide goes out." In other words, if you aren't following a system that works in all market conditions you will be caught naked when the market changes.  
If you prefer to have consistent profits and reduced risk, follow a proven system. Make you’re investing boring, so the rest of your life can be exciting.  
Lesson four: Get rich quick = get poor quick
Real estate is a long term investment yet some investors chase the “fast money.”  
You’ve probably met people like that - they look for that deal that will make them fabulously rich. When you see them a year later, they’re usually no better off financially and still talking about the next deal that will make them rich.  
They are often influenced by the latest get-rich-quick artist with a great story about how you can join them and become stupendously wealthy.  
Their stories can be very compelling, even hard to resist.  
They often pander to the wishes of people who would like to give up their day job to get involved in property full time, but in reality it takes most people many years to accumulate sufficient assets to do this.  
Patience is an investment virtue. Warren Buffett said it right when he explained that: “Wealth is the transfer on money from the impatient to the patient.”  
Lesson five: It’s about the property 
 You’re in the business of property investment, yet during the last boom many investors forgot the age-old property fundamentals of buying the best property they could afford in proven locations.
Instead they got sidetracked by glamorous finance or tax strategies and some lost out.
Smart investors do it differently. They make educated investment decisions based on research and buy a property below its intrinsic value, in an area that has above average long term capital growth and then add value creating some extra capital growth.
These are just five of the many lessons that I learned from previous property cycles.  
If you head these teachings the rollercoaster ride will not be as dramatic next time round because you won’t let emotions drive your investment decisions. Both fear and greed will drive you down the wrong path.  
Promise yourself that as the boom rolls out you won't get too excited, then when the next downturn hits (and you know it will) you can just confidently smile because you will have made the most of our next property boom.
 
<hr>
 Michael Yardney is a director of <a href="https://www.metropole.com.au/" rel="nofollow">Metropole Property Strategists</a>.
 
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Five lessons I’ve learned from past property booms: Michael Yardney

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As investors, sometimes the most efficient unit buying strategies for some locations is to consider or favour older developments. In highly renter-desirable locations purchasing older apartment stock usually come with a few advantages, such as:
- A more cost-efficient buy-in rate than new stock;
- Locations that newly built blocks just cannot compete with (such as unobstructed ocean views, or the quietest streets in a suburb otherwise full of noisy, congested arterial roads);
- Oftentimes larger apartment square meter space;
- Opportunity for renovation and modernisation to both add capital value and also increase rental return.
This is not to say that buying new or near-new stock does not have its benefits. In many instances, you will be better off in your selected suburb or street to purchase newer stock. Depreciation schedules look much more tax advantageous, unit layouts are usually more befitting a 21st century lifestyle and this is attractive to would-be tenants, plus features and facilities are usually far superior than older blocks.
However, I’ll focus entirely on older blocks and ways to add value to them. Some of the ideas I have successfully implemented myself, whilst others I’ve observed peers and colleagues who have had positive rental return knock-on effects from such renovations. Some elements are things you can do within your own unit, whilst others are things that can add value to the entire block, but as such require voting-majority agreement in strata committee sessions.
 Adding secure entrance doors to the block
This is a project I am actually in the middle of, with one of my investment properties. Older blocks, say those of circa 1950?s through to 1990?s, are almost always your usual apartment block affair; being typically a three-floor ‘walk-up’ brick block.
Most blocks will have anywhere from four to t12 units, across two or three floors. These kinds of blocks would have originally been fitted with a basic wooden entrance door to the building. Some buildings do not even have a lock feature on these doors, and some in especially poor states disrepair do not even have a door at all!
Tenants value security when it comes to apartments and units, especially in inner and middle ring suburb locations in cities. Adding a modern, intercom-connected, secure aluminium-and-glass door system will add peace of mind to tenants living in that block. It will also add value to every unit in the block for this reason.
The challenge with implementing this of course is that being a shared problem; it is a strata solution. This means that there needs to either be enough money in the sinking fund to pay for it, or a special levy will need to be raised to pay for it. In either scenario, the strata committee and members must vote on such an addition to the building and a majority must indicate their preference to have the project done.
To give you an idea of scope, the property I referred to at the moment has been back-and-forthing the security door installation issue for over twelve months. First, the vote had to occur and be won. That took time. Next, multiple contractor quotes were required for submission, again taking more time. The strata committee had to then agree a candidate contractor. Finally, the contractor is still yet to commit to starting the work. Due to this issue affecting all tenants, we also must advise tenants well in advance of the works to be carried out.
Secure letterbox installation
This is a less labor-intensive renovation than a security door, but still it requires the agreement and funds allocation of the voting strata committee. Just like their personal security, tenants are increasingly valuing more secure letterboxes in older building.
Why? Because the fastest growing ‘category’ of crime in the world is not murder, traditional kidnapping, armed robbery and so on. Instead, it is a far more profitable and lower risk crime:  identity theft and digital theft of bank accounts, data, and personal information.
And it is happening all over the world. Russian organised crime and mafia families for instance, are transitioning from being leg-breaking, murderous, threatening gangsters to digital, thieving, and threatening gangsters. Identity theft via the hacking of social networking data to illicit sensitive personal banking and financial data, is becoming more and more common.
So is the instance of letterbox-raiding. This is because the letters you get from banking and financial institutions contain the ‘missing link’ information that, when combined with hacked digital data, adds up to be an almost-complete profile of a victim. From here, criminals are able to connect the data types and contact institutions, enabling them to steal money and other sensitive data from the victim.
Older blocks have decaying and easily breakable letterboxes where data thieves can access your information, so by having a modern secure letterbox be built, it gives renters a further comforting peace of mind. Usually these are built directly on top of an old brick wall style letterbox. The old letterbox holes then get a metal sheet covering them, which usually spells out the block number and building name too. These look quite nice and add a modern touch to older units; making them easier to see from the street and identify, when visitors are trying to find the place.
Maximising common property space to fit more parking
This is a much less common strategy but one worth mentioning. Take for example an older 1970?s, three-floor walk up block. Let’s say there are 12 units on it, with uncovered parking lines that can fit eight cars in it.
Usually in these instances, the eight parking spaces are not ‘on-title’ belonging to any unit. That effectively means that the 12 occupants must randomly share the eight spaces. It also means that when selling a unit in this block, the owner cannot sell the unit stating that it comes with its own parking space. In some suburbs in inner-ring areas of cities in Australia, a unit with dedicated parking can be as rare as hen’s teeth.
Typical in these older blocks too, are large clothes line areas (the old ones that screech when the wind blows them around in circles). If you are able to get the agreement of the strata committee to fund the investment; some blocks are converting the clothes line areas into extra parking spaces – enough to make a spot for each unit. The clothes lines are then replaced down the side of the building with modern space saving wall-mounted fold up clothes lines. The lawyers then draw up a new strata plan that allocates on title one car space per unit. This is the most expensive part. The valuers are then brought in at the end to assess each unit value now that it features a dedicated on-title car parking space.
This strategy will not be right for many blocks. In fact, in some suburbs, the costs involved above to add the improvement, may not be returned in terms of the value-add that on-title car parking spaces, per-unit, will give. However, the value-add will occur both in rental return increase of some degree, and capital growth over all of every unit value.
 
<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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