The residential transformation of St Kilda Road is set to continue into with more new apartment plans for the sought-after boulevard.

Wing Tai Asia has lodged plans for a major residential tower at 464-466 St Kilda Road, replacing the former VACC House with an 18-storey mixed-use development designed around a retained heritage podium and a sculpted contemporary tower.

The proposal, prepared under Victoria’s Significant Residential Development with Affordable Housing pathway, would deliver 325 apartments and ground-floor retail across the prominent 4,653 sqm boulevard site in Melbourne’s St Kilda Road North Precinct.

The project centres on the adaptive reuse of the site’s heritage-listed VACC Building, an eight-storey office designed by Bernard Evans that has occupied the address for decades. Planning documents state the development would involve “carefully dismantling and conserving off-site the original metal fabric of the podium visible from St Kilda Road,” before reinstating it as the defining frontage of the new scheme.

Above the restored podium, Wing Tai is proposing a curvilinear residential tower. The scheme includes 172 one-bedroom apartments, 63 two-bedroom apartments, 66 three-bedroom apartments, and 24 four-bedroom apartments, alongside two ground-floor food and beverage tenancies fronting St Kilda Road.

The tower has been designed with substantial articulation and variable setbacks to minimise perceived bulk and maintain view corridors along the boulevard. Urbis, which prepared the planning report, said the design “has been significantly articulated through a curvilinear design” with “an interplay with materials, façade expression and depth” to create visual separation and visual interest.

The proposal also includes 254 basement car spaces, landscaped pedestrian links connecting St Kilda Road and Queens Lane, and a biophilic landscape strategy featuring canopy trees, raised planters, cascading greenery and a glass oculus pool overlooking the eastern frontage.

Planning documents confirm the $270.1 million development will contribute 3 per cent of project costs to the Social Housing Growth Fund as part of the application process.

Wing Tai acquired the St Kilda Road property in 2018 alongside Abacus Property Group for $95.38 million, before later consolidating ownership of the site. The property previously served as the Victorian Automobile Chamber of Commerce headquarters for around 60 years.

The transformation of the St Kilda Rd boulevard is already beginning to materialise, with a number of high-profile projects recently completed, launched, or approaching launch as developers continue to back the long-term appeal of the precinct.

Among the most notable recent completions is Louise by Samuel Property Group, just off the strip on Queens Lane, the same pocket Hirsch &amp; Faigen recently launched The Queensbury. Mirvac is too on the same street with The Albertine, which is approaching completion.

Dexus recently secured approval for its slice of St Kilda Road, while Gurner also has approved plans for the precinct.

Joel Robinson

Wing Tai unveils 325-apartment St Kilda Road tower on former VACC House site

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>

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.
</section>
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[smartcode_project_cta:default project_id=112661]

SIERA kicks off construction at Northcliffe tower Exhale

Home Loans

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Yellow Brick Road has announced that it will acquire the non-bank lender RESI Mortgage.
YBR will pay $36 million for the business, $28 million in cash, $5.5 million in shares and $2.5 million in deferred cash payments.
RESI foundation shareholder Peter James said it represented a "sound strategic move for the RESI business".
The Resi business would remain a separate brand and maintain its current management structure, with Angelo Malizis as the RESI CEO.
YBR executive chairman Mark Bouris said the acquisition of the 30-year old company would enhance YBR's national presence.
The company also announced that it had secured $42.05 million of commitments in a raising placement to existing shareholders and institutional clients of Bell Potter.
Existing shareholders Macquarie Bank and Nine Entertainment subsidiary subscribed to $12 million each in the placement while other institutional investors took the remaining $18.5 million.
YPR said the funds will be used to pay for the cash considerations of the Resi acquisition and also the recent Vow acquisition.
“We welcome the Resi franchisees, management and staff to the YBR group and look forward to leveraging our marketing platforms to significantly increase Resi’s lead flow as part of our combined group,” Bouris said. “The complementary skills and relative strengths of the YBR, Vow and Resi brands and businesses will combine to provide Resi franchisees, YBR branch licensees and Vow brokers with unparalleled opportunities to build revenues and market position as we progress our strategy to be a leader in the “non-bank” sector,” he said.
Bouris has extended his consultancy agreement with YBR for another four years until 2019.
The acquisition of Resi remains subject to a general meeting of YBR shareholders expected to be convened for late August 2014.
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Mark Bouris at the helm until 2019, as expansionary Yellow Brick Road acquires RESI Mortgage

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Westpac has cut the introductory variable interest rate for its Flexi First Option Home Loan product by 49 percentage points. 
Customers opening a new Flexi First Option Home Loan with conditional approval by 3 October will have a 4.84% per annum interest rate for the first two years of their loan. The interest rate converts back to 5.33% after the two year period (comparison rate 5.38%).
Westpac has offered an ongoing discount on its Flexi First Home Loan product since April 2013, with a 0.21% per year rate cut bringing the variable rate to 5.12%. Borrowers cannot take advantage of both discounts at the same time.
Westpac also removed its $600 Home Loan Establishment Fee on all new home loans. According to The Adviser, Westpac brokers were told the discounts would “position Westpac competitively in the market as the bank to assist your first home buyers with their home loan and other financial needs”.
The bank has applied special interest rate offers to a variety of its other variable products.
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Westpac courts first home buyers with 4.84% variable rate

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ANZ refrained from changing its variable interest rates for its home loans in its hastened July monthly review.
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Its standard variable home loan rate remains at 5.88% per annum (5.98% per annum comparison rate). 
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But the ANZ has announced, while sticking to a formal monthly review, that it will now come quicker - by the Friday following the Reserve Bank of Australia’s board meeting, not the second Friday.
“The change to the timing of our monthly review follows consistent customer feedback that they would like to understand the outcome of our interest rate review process earlier in the month in line with our competitors,” the ANZ chief Philip Chronican said.
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“Given the more predictable international economic environment and the greater stability that exists in offshore funding markets we are now in a position to assess the impact of any RBA decision along with the other drivers of funding costs in a more timely way,” Mr Chronican said.
The ANZ went solo in late 2011 with its second Friday monthly review following a statement in December 2011 that the bank would announce any changes to variable mortgage rates for retail mortgages and small business lending on the second Friday of each month
The other big banks have stuck to erratically making announcements without any formal timetable following official RBA cash rate announcements that come on the first Tuesday of the month. 
The latest ANZ interest rate change was announced last August lowering interest rates for variable rate mortgages by 0.25% per annum following its monthly interest rate review.
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ANZ will be quicker to announce any rate change

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GUEST OBSERVATION
We all want a property portfolio that costs us nothing to hold. It’s the dream to be able to purchase more and more properties because every property pays for itself. So why do people opt for negatively geared property if the best option is a positively geared property portfolio?
The general argument is that negatively geared properties are that way because they are in areas offering higher capital growth but lower yields. For example, metropolitan areas where the value of the property is high in comparison to the rental income it receives. And the common notion is positively geared properties, are typically in regional or fringe areas of cities or may involve a dual occupancy, like a granny flat and as a result achieve higher rental yields in comparison to the overall value of the property.
However like all things there are exceptions to the rules and some properties with reasonable capital growth can still offer reasonable rental returns. For example, according to the Commonwealth Banks recent report on the state of the property market in Australia over the last 12 months:
<a href="/news">Kelvin Grove</a> in Brisbane reported 4% capital growth and averages 4.7% rental yields.
<a href="/news">Strathfield</a> in Sydney reported 13% capital growth and averages 4.5% rental yields
<a href="/news">St Kilda</a> Melbourne reported 4.7% capital growth and averages 4.3% rental yields
And with RP Data’s latest economic report showing average nationwide unit rental yields while down are still achieving on average 4.7%, most investors would be looking at the current three year fixed interest rates under 5% and thinking we have hit the sweet point where you can achieve the dream and just keep adding properties almost ad infinitum.
So why is lending still a problem and why can’t investors just keep adding properties?
The first thing to keep in mind is the normal costs associated with owning an investment property, like real estate agency fees, council rates, strata fees. Then there are the ones that people often overlook like the unexpected hot water system replacement.
Let’s assume though that you achieve a rental return of 6% and the costs are no more than 1% so that you have net rental of 5%.
Won’t the lenders give you unlimited loans?
This is when the lenders start to apply their own stress testing to your borrowing and it can make a huge difference. For example while some lenders will allow you to consider the actual interest rate of your loans where the loans are fixed for more than three years others will apply the normal variable testing interest rate.
And what a difference, on a typical $500,000 loan the difference could be. Interest only payments with a fixed rate of 4.99% of $2,079 per month or calculated loan repayments of $3,530 per month where the lender loads the interest rate by 2% and applies principle and interest payments over 25 years.
That is a difference in rental payments of $1,451 per month in order to get the loan to match the rental income or put it another way, a net rental yield of 8.47%.
Now there are creative ways of increasing your rental yield like renovations, allowing the tenants to keep a pet or adding an extension or granny flat that will allow the property to generate an additional income stream.
So why do lenders look differently at your current loan repayments? We know it all comes back to the four credit rules or  four C’s of credit. That is each lender is weighting the importance of your ability to afford the loan repayments slightly differently depending on their expectation of where interest rates, unemployment and the general economy might be going.
So there is no right or wrong answer to the question about whether negative or positive is right or wrong because for every investor is comes down to personal circumstance, your individual goals and your ability to service your loans.
If you would like guidance on which lenders might be right for you or a free property report on the possible capital growth of your properties why not give us a call.
Albertus Waldron is a partner at Chan &amp; Naylor. For a free portfolio review or guidance on which lenders might be right for you, you can contact <a href="https://www.chan-naylor.com.au/contact/" target="_blank">Chan &amp; Naylor</a>.
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Why lenders are negative about positively geared property

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Latest home loan approval figures from Mortgage Choice suggest that it is variable rate home loan products that are continuing to prove popular.
In June, variable rate home loans accounted for 75.34% of all home loans written in the month – up 1.21% on May.
This comes as no surprise to Mortgage Choice spokesperson Jessica Darnbrough.
“The Reserve Bank of Australia has made it clear they are happy with the current setting of monetary policy and they could leave rates on hold for some time yet. With that in mind, more borrowers are opting for a variable rate home loan, rather than lock themselves into a fixed rate,” Darnbrough said.
Across the variable rate home loan offerings, ongoing discounts are currently the most popular – securing 39.62% of all loans written, with demand highest in Western Australia and New South Wales, 47.91% and 45.32% respectively.
“Australia’s lenders are hungry for business at the moment and, as such, have been offering some sensational variable rate discounts in a bid to attract borrowers and grow their market share,” she said.
Fixed rate demand was down in every state other than New South Wales and Queensland, where they were up marginally. Fixed rate demand dropped 10.44% in Victoria, and fell marginally across Western Australia and South Australia.
“While fixed rate demand has dwindled a little in certain states recently, the reality is borrowers can still secure themselves a very competitive rate – regardless if they opt for a variable or fixed rate home loan,” she said.
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Variable rates remain the loan product of choice

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Property Observer has looked at the highest, lowest and average interest rates on CANSTAR’s database for home loans, term deposits and credit cards.
Their research manager, Mitchell Watson said there were virtually no changes to home loan interest rates over the past week.
"Nor have there been any changes to term deposit rates.
“Mortgage holders in particular can still save significant money though by being aware of the interest rate they are being charged and what else is available.
"Currently on CANSTAR’s database there is a 1.85% difference between the highest and lowest standard variable home loan rate.
"On a $400,000 mortgage over a 25-year term, that potentially equates to around $440 in additional repayment cost per month.
"Even the difference between the average and lowest is around $210 per month.
"There are also some very competitive fixed-term deals, with offers as low as 3.95% for one year fixed and 5.30% for five-year fixed," said Watson.
Here is a rundown of the current state of the interest rate market.
Home Loans
<img src="/images/2014/07/01/table-july-1-one.gif" alt="">
Term Deposits 
 <img src="/images/2014/07/01/table-july-1-two.gif" alt="">
Source: <a href="https://www.canstar.com.au" target="_blank">www.canstar.com.au</a>.  Rates on the CANSTAR database as at 30/6/2014, based on a deposit amount of $250,000.
Credit cards  
Credit card interest rates remain stubbornly high compared to the official cash rate. Overall, the credit card products surveyed are as follows:
Low rate
<img src="/images/2014/07/01/table-july-1-three.gif" alt="">
Standard <img src="/images/2014/07/01/table-july-1-four.gif" alt=""> 
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A 1.85% difference on standard variable home loans

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Australia’s banks are the most profitable in the world, according to the latest <a href="https://www.bis.org/publ/arpdf/ar2014e6.htm" target="_blank">annual report</a> from the Bank of International Settlements.
The big four last year pocketed $27 billion in profit, up 9.5% on the previous year.
Australian banks lead the world in terms of pre-tax profits (as a percentage of total assets) at 1.28%, with the US coming in a close second at 1.24%. Australia also showed the third best net-interest margin, the fifth best loan loss provisions and the third lowest operating costs.
Australia’s insurance sector also stood out as the best performing in the world.
This article first appeared on <a href="https://www.SmartCompany.com.au" target="_blank">SmartCompany</a>.
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Aussie banks the world's most profitable

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Serviceability will affect anyone looking to buy property. Firstly, know where you stand with serviceability. If you’re not heading to a broker or a lender quite yet, then do some quick calculations.
If you’re unsure what is looked at when calculating your serviceability, then you need to read our article from yesterday detailing <a href="/expert-insights/finance/what-is-serviceability-investment-terms-explained">“Investment terms explained” about the components that dictate your serviceability</a>.
You’ll also want to be very clear on what you can afford before looking to increase your serviceability. What you can borrow,and what you should borrow, are <a href="/expert-insights/finance/just-how-much-should-you-prudently-borrow-even-if-the-banks-ignore-the-rba-cheap-money-warning">often two very different things</a>. Prudent is the word to bear in mind.
Now you’re aware of what goes into the serviceability, and how different factors affect it, it’s time to see what you can do in your own life to reduce overheads. Of course, spend less and earn more are the two most commonly cited factors – and certainly they’ll both be effective. However, vying for a pay rise or taking on a second job might just not be practical for you.
Shop around
Firstly, see if you are calculated as being more serviceable elsewhere. An understanding of different lending policies, which a good broker may be a help with, can assist. You can read this article here about <a href="/expert-insights/finance/how-to-pick-the-best-mortgage-broker">choosing the best mortgage broker for you</a>. Different calculations are used by different banks and lenders.
Pay down debt (and avoid taking on more!)
If you can, it’s time to supercharge your debt repayments and clear them as quickly as possible. This is particularly good for buyers who are not intending to get into the market for some time. Avoid upgrading your phone to a new expensive plan and taking on increasing levels of debt, as all of these additional costs will decrease your serviceability (and, thus, your borrowing power). You might also consider putting off that extra child until you've purchased - children, due to the high level of expenditure required to raise them, are seen in the "outgoings" category.
Reduce credit card limits
High credit card limits affect your serviceability – even if you haven’t used them to their limits and do not intend to. Reduce them as best possible. You can increase them after you have your loan.
Decrease other overheads where possible
Yellow Brick Road’s <a href="/expert-insights/finance/the-20-tips-to-ensure-you-get-your-loan">Mark Bouris recommends reducing your overheads</a>, as well as avoiding taking on more.
“Fancy car leases, big smart phone plans and cable TV charges can reduce your net income and affect your serviceability,” he says as one of his 20 tips to ensure you get your loan. You could consider consolidating short term debt into longer term debt to reduce your monthly repayments.
Ensure you are factoring in all of your deductions
There may also be some added deductions that you’re not claiming that affect your overall serviceability for your next property - for instance, are you claiming your maximum depreciation?.
Here’s <a href="/expert-insights/buying/how-your-loan-structure-could-be-hindering-your-property-investment-potential">a breakdown as to how this might work</a>.
Increase rental income
There are a number of ways to increase the rent you’re getting for your current investment properties (here are <a href="/expert-insights/investing/how-to-boost-your-rental-yield">some tips if you’re looking to boost your rental yield</a>). This can be seen as a form of increasing your income. <a href="/expert-insights/investing/how-to-boost-cash-flow-using-your-investment-property">Margaret Lomas shares her tips around increasing rental property cash flow</a> here.
Of course, the most important thing is <a href="/expert-insights/investing/market-value-not-landlords-hopes-should-determine-rent-mcgrath">ensuring your properties are being rented at market value in the first place</a> and you’re not selling your property short.
What tips do you have for Property Observer readers to increase their serviceability?
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Six tips to help improve your serviceability

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Serviceability is a crucial part of obtaining finance. Essentially, it dictates how able you are to meet repayments of your loan.
To banks and lenders this is crucial as it determines whether or not they can lend a certain amount to you - the less serviceable you are, the less you can borrow.
It is defined by a number of criteria. Largely, it looks at your income and financial situation against your debt and liabilities, as well as living costs. They’re trying to work out how much you can afford to set aside for a mortgage each month. Think of this as your “in” and “out” columns.
Your income covers money that you bring “in” from all sources – your salary, any child support you receive (if you provide child support, this will fall into your “out” column), any money you receive from rental properties or other investments, and so forth.
Your “out” column, or your outgoings, includes all repayments and current debt, such as for credit cards, living expenses and other ongoing costs. Any children you have, or dependents, will also fall into this category. Note that your 'living expenses' will be likely based on an amount that the lender considers appropriate for your type of household - just because you are particularly frugal does not necessarily mean that this will benefit the numbers on this occasion.
After you have both of these worked out - the remainder of your money is what is then looked at to determine whether you can afford to make repayments on a loan.
According to Build.com.au “When you’re looking for approval for a loan, your total monthly debt expenses are expressed as a proportion of your gross monthly income. This is known as the ‘debt service ratio’ - and it should be set at a maximum of between 30 and 35% of your gross income.”
Future rate rises are also calculated in, and some lenders include a "buffer" that can affect buy-and-hold investors. If you come up against a serviceability wall it isn't uncommon to find that you are deemed serviceable by a different lender due to varying criteria.
Homeloanexperts' Otto Dargan notes that there are three methods for calculating serviceability. These include Net Surplus Ratio (NSR), Debt Servicing Ratio (DSR) and Surplus/Uncommitted Monthly Income (UMI). He <a href="https://www.homeloanexperts.com.au/how-much-can-i-borrow/" target="_blank">notes that these are used by the bulk of Australian lenders and banks</a>.
Serviceability can be complicated when considering all of the different factors that the banks are required to consider to ensure you can repay your loan. Luckily, they can be fairly transparent about this process.
For instance, you can do some fairly quick serviceability checks online. While these aren’t foolproof, you’ll have a pretty good understanding of where you’re sitting.
For instance, there is <a href="https://www.google.com.au/url?sa=t&amp;rct=j&amp;q=&amp;esrc=s&amp;source=web&amp;cd=8&amp;ved=0CHUQFjAH&amp;url=http%3A%2F%2Fwww.genworth.com.au%2Fdocs%2Fdownloads%2Fservicing-calculator_2013-06.xls&amp;ei=5KSXU5ObIsrjkwWeqoHICA&amp;usg=AFQjCNEiPSoi5ce-u6W4YMZuDin7fWsojw&amp;sig2=QkJbIxL827m6v84W-uM5qg" target="_blank">this fairly thorough Genworth calculator (note: this is an excel spreadsheet download)</a>.
Or you can try <a href="https://www.amp.com.au/wps/portal/au/AMPAUPlannersGeneral3C?vigurl=%2Fvgn-ext-templating%2Fv%2Findex.jsp%3Fvgnextoid%3Da498a451359c2210VgnVCM10000083d20d0aRCRD%20" target="_blank">one of the others in AMP’s range</a>.
Did you know that reducing the limits on your credit cards can help increase your serviceability? We will look at tips for how to increase your serviceability and the specific factors you should take a second look at tomorrow in our ‘how to’.
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What is serviceability? Investment terms explained

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ME Bank cut the its one year Standard Home Loan rate by 0.05% and its five year Standard Home Loan rate by 0.4%.
The bank’s one year Standard Home Loan now has a 4.89% per annum interest rate, with a comparison rate of 5.35% per annum. The five year fixed Standard Home Loan rate is now at 5.39% per annum, with a comparison rate of 5.40%.
According to ME Bank, it currently offers the lowest three year and five year fixed home loan rates on the market. Chief executive Jamie McPhee said that the cost of fixed rate funding has been falling amidst persisting “global economic weaknesses” and growing expectations for fiscal tightening after the budget.
“Fixed rate funding costs are falling as the market pushes out expectations for future RBA rate movements. ME Bank has taken advantage of these falls and is passing on the savings to customers,” he said. He also noted the economy’s ongoing transition away from the mining sector and “below average” domestic economic performance.
McPhee warned customers not to be swayed by cash-back incentives offered by some banks.
“Cash back sweeteners can be nice in the short-term, but customers should understand they can save much more on their home loan in the long-term by locking in a lower rate," said McPhee.
For more interest rate coverage, see:
<a href="/expert-insights/finance/moderation-in-pace-of-house-prices-lately-despite-significant-yearly-growth-glenn-stevens-june-statement">Moderation in pace of house prices lately, despite significant yearly growth: Glenn Stevens' June statement</a>
<a href="/expert-insights/finance/thanks-to-low-interest-rates-affordability-at-highest-level-for-over-a-decade-hia-cba-index">Thanks to low interest rates, affordability at highest level for over a decade: HIA-CBA index</a>
 
 
 
 
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