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

SIERA kicks off construction at Northcliffe tower Exhale

Home Loans

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The First Home Saver Account scheme was one of the Rudd government initiatives axed in the Abbott government’s first federal budget.
Under the scheme, First Home Saver Accounts were given concessional tax rates and government co-contributions. Despite offering a concessional tax rate of 15% on interest earned in the accounts and awarding 17% co-contributions on the first $6,000 deposited by savers each year, the scheme failed to attract many savers preparing to purchase their first home.
The scheme’s low take up has been attributed to poor marketing and the regulations attached to the accounts. In order to qualify for the benefits, savers needed to deposit a minimum of $1,000 a year over four years before they could withdraw any money in the account. If the money was not used for a payment on a saver’s first home, it was added to their superannuation account.
Any new accounts created after 13 May will be ineligible for tax concessions or co-contributions. Existing accounts will not receive any co-contributions after 1 July 2014. National tax director of professional services firm BDO Lance Cunningham says that the government has begun winding down the scheme.
“It’s basically been abolished but with a phase out, so that from budget night you won’t be able to open any more new accounts. But for existing accounts, the co-contribution will cease from 1 July 2014.”
Savers who hold existing accounts will be able to receive co-contributions for deposits made in the 2013-14 financial year up until July.
“Be careful, it’s only a budget announcement,” says Cunningham. “But it seems to be fairly clear that if you make contributions before July this year, the co-contributions will be honoured.
“If you haven’t reached the co-contribution cap, which I think is about $6000, you might consider depositing more money in the next month to receive your co-contribution.”
Although co-contributions will end on July 1 this year, tax concessions will continue for another year.
“The tax concessions will still be available up until July 2015,” says Cunningham. “They will still be treated as First Home Saver Accounts, but the concession ceases after that date. After July 2015, they will be treated as any other account.”
Savers who have held their existing accounts for less than the four year period will have to wait until 1 July 2015 to withdraw their savings.
Steven Gunzburg is a 26 year old account manager who holds a First Home Saver Account. He says that though he understands why the scheme is being scrapped, it provided good incentives to save.
"I was contributing the maximum amount, which increased over the past 3 or 4 years, every year." 
"Mainly it was a fantastic way to incentivise people to think about saving from a much earlier age. There’s no way in the world that it’s going to make the vast majority of my deposit, but it helps you get into the right mindset."
Gunzburg opened his account when he was 18 or 19, after his mother explained the benefits of the scheme.
"My mum actually found out about it, explained it to us and I begrudgingly put quite a reasonable amount of my money into the account," he says. But Gunzburg says that the scheme had its downsides.
"Part of the problem with the scheme was that it was so complex and convoluted, it was incredibly hard to understand when and how you could access your money."
When the scheme was announced in 2008, the Rudd government predicted that 750,000 First Home Saver Accounts would be opened over the next four years. However, as of December last year, only 46,000 accounts had opened.
Late last year, <a href="/expert-insights/calls-for-urgent-revision-of-first-home-saver-account-scheme">comparison website RateCity called for changes to the scheme</a>. Chief executive Alex Parsons said that at the time, none of the “big four” banks offered the accounts.
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jrichardson-uRX5hFdKfN

First Home Saver Accounts scrapped: What now?

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In the current low interest rate climate, many first home buyers may be confused about the best option for their first home loan.
Choosing your home loan means striking a balance between your varying priorities. Are you after low fees? Or are you more interested in being able to capitalise on interest rate cuts? Maybe you’re happy to pay a bit extra now for protection against future rate hikes.
To help you with the daunting task of choosing your first home loan, Property Observer has four key tips:
<ol>
<li>
THINK LONG TERM Be prepared for your life circumstances to change over the course of your mortgage. You may be employed full time with a steady income, but there are lots of things that can affect your ability to make repayments further down the line. Babies, break ups and getting the boot at work can all make a serious dent in your financial plans. Think realistically about your life five or 10 years down the track, because you are about to make one of the biggest financial commitments of your life. 
</li>
<li>
FINANCE FIRST Before you’ve found your dream home, work on finding your dream mortgage. Speak to a mortgage broker prior to purchasing a home and look into securing a home loan pre-approval – while it isn’t a total guarantee that you will be able to finance your house, it’s as close as you’ll get. Getting pre-approval can help real estate agents take you seriously and give you an idea of your budgetary constraints. 
</li>
<li>
VARIABLE OR FIXED? With interest rates at a record lows, fixed rates have definite benefits. A fixed rate mortgage will lock your interest rate in and protect you from future rates hikes for a set period, usually three years. Fixed rates are also generally at competitive levels at the moment. However, there are many other factors beyond interest rates will determine what the best loan is for you. You may benefit from low monthly fees, a flexible loan arrangement or discounts for bundling your accounts with a single lender. Don't be afraid to shop around. A good mortgage broker will help you decide what is best for you. Once you’ve decided on a loan, it’s wise to revisit your loan with your broker on a yearly basis to see if it’s still the best arrangement for you. 
</li>
<li>
KNOW YOURSELF Choosing the best home loan is all about full disclosure and being honest with yourself about your finances. Many lenders offer loan repayment calculators that will help you determine how much you can afford to pay each month. While frugality generally pays, you may find that you just can't live comfortably without a certain level of extra spending money each month, so leave yourself a little room to move if you can. And remember, your financial decisions will determine what loans you have access to, especially now that your credit history includes more detailed information including when you pay your bills. </li>
</ol>
Shopping for your first home is an exciting time, and it's hard to reserve quite the same amount of enthusiasm for mortgage shopping. But taking the time to choose the right home loan can save you a lot of time and a lot of money down the track.
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First home buyers: four tips for choosing a home loan

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It appears that the floor hasn’t been seen for some home loan products, with Greater Building Society cutting their fixed rates on two, three, four and five year fixed rates for its packaged home loan, the Ultimate Home Loan, from today.
In early February, it was found that <a href="/expert-insights/finance/lenders-make-out-of-cycle-rate-cuts-ahead-of-rba-announcement">20 lenders had made cuts since the beginning of 2014</a>.
The Greater Building Society changes:
<ul>
<li>Three year rates: 26 basis points, to 4.99% </li>
<li>Two year rates: 20 basis points, to 4.79% </li>
<li>Four year rates: 11 basis points, to 5.49% </li>
<li>Five year rates: 15 basis points, to 5.64%</li>
</ul>
Greater Building Society’s CEO, Don Magin, said that those looking for a fixed rate should avoid the “revert rate rort” where customers end up on a higher, or even the highest, standard variable rate when the fixed loan term is completed.
Fees around transaction accounts, insurance costs, financial planning fees, redraw facilities and any annual fees on linked cards should be looked at.
As Property Observer previously reported, the <a href="/expert-insights/finance/gap-between-official-cash-rate-and-home-loans-continuing-to-widen">gap between the official cash rate and home loans continues to widen</a>.
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jduke-EHk3XBmHkn

Lenders continue to cut fixed rates for home loans

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When looking for a mortgage pre-approval, it isn't easy. There are many ways to go about it, and the last thing you would want is for the loan to fall through last minute - particularly if you're looking at buying at auction.
At the end of last year, an increasing number of people were being reported as <a href="/expert-insights/investing/home-loan-approvals-soar-while-first-home-buyer-proportion-sinks">taking out pre-approvals and using it as a leg-up over competition</a>.
<blockquote>
Having pre-approval will enable you to know what you should bid up to at auction, what you can afford and where your limits are.
</blockquote>
However, Property Observer knows of a number of cases where buyers, confident that they can achieve a certain loan, head in and find their finance fallen through. Don't let this happen to you.
First up, a recommendation is to always look to get formal approval, rather than pre-approval, for auction. Pre-approval is generally most useful when you can offer a conditional contract on the basis of a valuation, inspections and similar.
What is pre-approval?
Think of pre-approval like reserving yourself a seat at a restaurant. You know you're going to want one, but you're not quite there yet. If you book, and provide plenty of information in advance, then you're likely to secure yourself a seat. If, however, you book for three people rather than five, or for the wrong time, you're going to find yourself without your venue of choice. Similarly, you may get there and find that there hasn't been a seat reserved for you after all or that your own circumstances have changed.
Pre-approvals for mortgages work in a similar way. You can head in to a lender, and fill in information, and then you will be provided a suggestion of your borrowing limit with conditions. You may later find that the pre-approval didn't have as much information as it needed to be accurate or that the property you're looking at doesn't stack up.
Why get pre-approval?
Having pre-approval will enable you to know what you should bid up to at auction, what you can afford and where your limits are. It will also give you a boost of confidence when negotiating a property.
Michelle Hutchison, money expert for Finder.com.au, explained to Property Observer that readers should look to get this done as early in the buying process as possible as it can help speed it up.
"I've seen people who have missed out on buying the home of their dreams because they couldn't make an offer in time as they didn't have pre-approval. Real estate agents will also take you more seriously because having pre-approval means you are essentially ready to buy," said Hutchison.
Century 21 Homes Loans WA, Harry Bozin, said that it can be<a href="/expert-insights/finance/why-you-should-secure-finance-pre-approval-before-looking-for-property"> powerful for pushing a vendor in the right direction</a>.
"In addition to enabling an investor to narrow the property search within a purchase budget, loan pre-approval could also provide increased price bargaining power with vendors, who might be willing to accept a lower price than was advertised with the knowledge that the transaction is already backed by secure finance – particularly in cases where a vendor is looking for a quick and hassle-free sale," he explained.
However, not all of them are the same.
Different pre-approval versions
Mortgage Choice head of corporate affairs Jessica Darnbrough told Property Observer that home loan pre-approvals are definitely worth considering.
"As a general rule of thumb, pre-approvals are valid for at least three months," she explained, although some vary. Commonwealth Bank's pre-approvals, for instance, are noted online to be valid for six months. After this time, you repeat the process and get another pre-approval.
"Some lenders only require potential borrowers to complete a short form in order to gain pre-approval, while others require a significant amount of information and documentation to provide a formal written pre-approval," said Darnbrough.
"To be sure of your borrowing capacity, a potential buyer should secure a formal pre-approval."
<blockquote>
"As a general rule of thumb, pre-approvals are valid for at least three months." - Jessica Darnbrough
</blockquote>
A formal pre-approval means more than just getting it done online. A five minute questionnaire and no follow up before being given an indication should not set your mind at east. Savvy borrowers will want to make sure that the pre-approval is a true indication of what they can purchase.
Hutchison explains that some will provide pre-approval within a 48 hour turnaround, while others can take longer. You will need to be ready in advance, especially if there is an enticing auction coming up.
"Borrowers can slow down the process if they don't have all of their paperwork in order, which means the lender will go back and fourth with the applicant to complete the application," she explains.
Paperwork you need
Pretend you're going for the final mortgage discussion, and replicate the paperwork you will need at that point. The more you can provide, the less back-and-forth there will be and the more comprehensive and accurate your pre-approval will be.
Bring:
<ul>
<li>Copies of your bank statements 
</li>
<li>Savings history for the past three to six months (minimum) 
</li>
<li>100 points of ID 
</li>
<li>Any proof of assets (eg council rates for any property you own) 
</li>
<li>Employment verification and payslips 
</li>
<li>Tax returns (particularly if self-employed) 
</li>
<li>Other proof of income (such as rental income proof through a lease document)</li>
</ul>
With these details, and some general information around whether you're buying new or looking to build, the lender will then look to verify the information. They will undertake a credit check and they'll also look to ensure there's nothing that could change your situation, such as reduced hours.
How useful is pre-approval?
It can be a powerful tool to have, and if you have time it's worth getting pre-approval done, however you still would not necessarily want to enter into an unconditional contract. A valuation on the property you are looking at, as well as the final say-so in regards to achieving finance will likely both be needed. This can mean that, despite having the pre-approval, you may still not be able to purchase the property.
Pre-approval can also help bring up any problems you hadn't prepared for. Perhaps you can't borrow as much as you had been hoping due to a bad mark on your credit file you hadn't prepared for. Either way, this can quickly alert you before you get yourself stuck into a contract.
<blockquote>
DISCUSSION POINTS:
WHAT HAVE YOUR EXPERIENCES WITH PRE-APPROVALS BEEN LIKE?
HOW USEFUL IS THIS DOCUMENT?
AT WHAT POINT IN THE BUYING PROCESS DO YOU OBTAIN ONE?
</blockquote>
Similarly, there can be problems with looking for obtaining pre-approval multiples times, warns Hutchison.
"Obtaining pre-approval is part of the application process, which means it will be recorded on your credit file every time you apply. This can have a negative impact on your credit file if you apply for too many home loans in a short period of time," she said.
Lastly, don't expect to get the same pre-approval from each bank or six months later.
"In regards to experienced investors: many often believe that because they have gained finance approval in the past that they will automatically be granted the same in the future. It is important to note, however, that this assumption is incorrect, as the lending criteria of banks changes constantly, meaning that investors can cease to qualify for loans despite their situations remaining unchanged," said Bozin.
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A quick guide to home loan pre-approval

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I never used to think of myself this way, but as I get older, I'm increasingly becoming quite a traditionalist and something of a curmudgeon.
Don't really like change too much. Used to hate white weddings in churches, but now don't mind them - as long as they aren't mine, of course. Would probably keep the Australian flag the same given a choice (and, despite not being anything remotely close to a monarchist, probably inclined towards the status quo there too). I vote for centre-right parties. Still like to buy weekend newspapers and prefer hard copy books written on paper, though I do buy e-books too. If I wasn't vegetarian, I'd probably be described as a meat-and-three-veg type.
When it comes to finance and investment, I'm generally conservative and like to stick to the tried and tested, and prefer to diversify broadly rather than gamble too much on individual stocks.
I believe in the endurance of traditional market cycles, although they may appear to be shorter than in times past with the advent of faster information flow and especially since cycles are no longer to be carried along on a tidal wave of inflation. 
When I read in press articles that "Gen Y are lazy" or "young people are opting out", I generally don't believe them. Most younger people will be pragmatic and forge their way in life, just as previous generations always have.
While the specifics will always change, I believe that history repeats.
And having been around through a few market cycles, most unfashionably of all, I believe that monetary policy generally still works.
Low rates
If you have been reading my blog since late 2011, you'll know that my absolute conviction has been that cuts in interest rates would dramatically change the way people invest their dollars.
As I clarified the other day, and has been known about for decades, when it comes to investment markets, <a href="/expert-insights/investing/six-places-to-invest-money-and-four-rules-for-doing-so">interest rates are like gravity</a> - ultimately, you just can't get away from them.
Since Australia is not in recession and credit markets have remained liquid, if my belief is correct then after an initial lag the delivered cuts in interest rates should see property investors flooding back into the markets and share markets catapulted higher.
Markets 
The Australian Bureau of Statistics (ABS) released its <a href="https://www.propertyobserver.com.au/https://www.abs.gov.au/ausstats/abs@.nsf/mf/5609.0" target="_blank">Housing Finance data</a> this week, which is a key indicator of what to expect in the property markets in the months to come.
I pulled out the housing finance data specifically as it relates to investment loans, which printed as below:
<a href="https://3.bp.blogspot.com/-pDastlTKFXc/U0T-Y1yBaiI/AAAAAAAAMaQ/cwa_dJQ3oRE/s1600/Investment+Loans.jpg"><img src="https://3.bp.blogspot.com/-pDastlTKFXc/U0T-Y1yBaiI/AAAAAAAAMaQ/cwa_dJQ3oRE/s1600/Investment+Loans.jpg"></a>
The value of investment loans jumped by 4.4% after a fall last month and are now up by a monster 32.3% year on year to the highest level ever recorded in Australia's history.
To me this represents proof beyond any reasonable doubt that monetary policy still works and property markets remain sensitive to the cost of borrowing.
Most lenders offer interest-only loans to investors for five years, at which point they flip into principal and interest loans or must be renegotiated by the borrower. 
The total value of dwelling commitments chart prepared by the ABS tells its own story.
<div class="separator"> </div>
<div class="separator"><img src="https://www.abs.gov.au/ausstats/abs@.nsf/a866861f12e106e0ca256a38002791fa/05dbce56402ec566ca25723d000f2999/Body/0.1FF2!OpenElement&amp;FieldElemFormat=gif" alt="Graph: Value of dwelling commitments, Total dwellings" width="248" height="320"></div>
Source: ABS
None of this is surprising when you consider that we have an interest rate of 2.50% yet an inflation rate of 2.60%.
After tax is paid on interest income, returns from bank accounts and term deposits are so dismal that return-seeking investors have been practically forced into the share markets or property investments.
Owner occupier mortgages and first home buyers
Owner occupiers can tend to march to their own drum to some extent, although of course fear of missing out can often see would-be home buyers jump into the market too.
But in the event owner occupier non-refinance commitments have also roared upwards by 17.5% over the past 12 months and owner occupier refinance commitments are a whopping 27.9% higher.
The first home buyer data, however, continues to be a complete waste of everyone's time since it fails to record the large number of first-timers who are electing to buy investment property first instead of a home, which, in Sydney at least, is a very regular occurrence.
There is no way to quantify this at present, but since every second inquiry I get as a property buyer fits into that category, it must surely be a significant factor - in New South Wales at any rate. 
As noted two years ago, if you don't listen to what the data is telling you, then you will certainly misinterpret it. 
Naturally a certain percentage of buyers are unquestionably priced out of the locations they want/need to buy in. 
But the recorded data is not commensurate with "an entire generation" of the population casually sitting out of the market, particularly when high LVR mortgages remain <a href="https://www.smh.com.au/money/borrowing/seeking-to-get-a-foot-in-the-door-20140401-35uqu" target="_blank">so widely available</a>, making saving deposits less of a hurdle than would otherwise be the case. 
Dwelling construction?
If the Reserve Bank's grand rebalancing plan is to work then new dwelling construction needs to take off, and there was healthy news from the data here too. I can't plot this any more clearly than the Housing Industry Association (HIA) has already done, so let's go with their chart:
<div class="separator">
<a href="https://4.bp.blogspot.com/-3mpHbrztgJk/U0UB5RC3fTI/AAAAAAAAMac/FFJ64X28QPY/s1600/HIAcons.jpg"><img src="https://4.bp.blogspot.com/-3mpHbrztgJk/U0UB5RC3fTI/AAAAAAAAMac/FFJ64X28QPY/s1600/HIAcons.jpg" width="400" height="202"></a> 
</div>
Source: HIA
Monthly figures were down a bit after an exceptionally strong month in January, but on a moving annual basis the number of finance commitments for new homes and construction was up by more than 14%. The trend since August 2012 is tremendously strong which bodes well for a large pick-up in dwelling construction.
History repeats 
At such times, experienced heads tend to speak the most sense. 
Back in 2004 at the end of Sydney's last boom the AFR's David Bassanese attracted a level of ridicule for suggesting that "housing affordability is just about where it should be". 
Prices in Sydney subsequently fell a little and were flat for some years, yet with dwelling prices having underperformed household incomes significantly over the past decade, now they are catching back up again. 
Steve Keen's old sparring partner Rory Robertson has been quite outspoken this week on the same subject, suggesting that buy-and-hold on Sydney property for the long term is a "no-brainer", and as for whether the market is demonstrating irrational exuberance...
<img src="/images/2014/04/11/tweet-april-11-one.jpg" alt="">
Other experienced heads such as economist Stephen Koukoulas also added that he wouldn't be surprised by higher prices....
<a href="https://2.bp.blogspot.com/-4rRcCUErWQM/U0UVhuwFliI/AAAAAAAAMa8/AL3MACrCVsI/s1600/KOUKOULAS.jpg"><img src="https://2.bp.blogspot.com/-4rRcCUErWQM/U0UVhuwFliI/AAAAAAAAMa8/AL3MACrCVsI/s1600/KOUKOULAS.jpg" width="400" height="67"></a>
Tight market 
It's very rarely noted that during the last boom period in 2003, the REIA recorded that Sydney's property markets had a vacancy rate as high as 4.4%. The rate of vacant properties was at an even more elevated 5.3% in the outer ring suburbs.  
By way of contrast, today's vacancy rate in <a href="https://www.sqmresearch.com.au/SQMResearchVacancyRatesFebruary2014.pdf" target="_blank">Sydney is just 1.6%</a>, and much lower still in certain popular market sectors, such as in the inner west: e.g. Erskineville 0.6%, Enmore 0.8%, and so on. 
Our capital cities and their infrastructure are bursting at the seams, and with <a href="https://www.smh.com.au/business/comment-and-analysis/is-australia-ready-for-23-million-more-people-20131028-2wb0n" target="_blank">2.3 million more people expected</a> to live in Australia in the next five years alone, we're going to have a heck of job keeping up.
If I learned one thing from the experience of the United Kingdom property markets since 2007, it's how the right properties in the right locations fare so much better when each cyclical downturn inevitably arrives, particularly the types of properties which are most in demand such as. For example, well-located dwellings close to the median price for the suburb. 
You can visit <a href="https://allenwargent.com/" target="_blank" rel="nofollow">AllenWargent</a> property buyers (London, Sydney) or Pete's <a href="https://petewargent.blogspot.com/" target="_blank" rel="nofollow">blog</a>.
His new book '<a href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx" target="_blank" rel="nofollow">Four Green Houses and a Red Hotel</a>' is out now.
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pwargent-M4siyDbqQY

Investment mortgages crunch all-time record high

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No doubt you're aware that when it comes to obtaning a mortgage on your property, you need to be aware of a little acronym called an 'LVR'. This isn't as complicated as the letters may suggest and, in fact, stands for loan to value ratio.
Essentially, what is what it means:
However much money your bringing into the property as a deposit is the 'value' that you're pouring into the purchase. The 'loan' aspect is how much the bank then provides to you, to bring the total of both up to 100% of the purchase price.
In practice, if you're borrowing $500,000 for a property and you have $50,000 as a deposit, you also have other funds for the other costs to get into the home, such as inspections. If you're not sure what these hidden costs are, then <a href="/news/vic/how-to-work-out-how-much-buying-a-home-costs">have a look at this quick guide</a>.
Take your deposit from the total amount of the property and you have the mortgage that you will need.
In this case, you need $450,000.
Your deposit, $50,000, works out to be 10% of the price of the property. This means that you are looking for a loan of 90%.
This 90% is your LVR.
You may sometimes see this referred to as an LTV, or 'loan To value'.
This is an important number as it determines how risky you are to the bank - who are less inclined to lend to you if you are asking for a higher LVR. Those borrowing over 80% are deemed to be in the higher risk category. It also <a href="/expert-insights/finance/how-buying-lenders-mortgage-insurance-can-allow-you-to-grow-your-property-assets-faster">determines whether you pay lenders mortgage insurance, or LMI</a>.
The more you put into the property, the less interest you will also be required to pay, and the LVR will help you determine the minimum deposit you will be able to put into the property.
The LVR also becomes important if you're looking to refinance. You will be required to leave some value in your property, and any over this can potentially be equity for future purchases, renovations or for other uses.
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What is an 'LVR'? Investment terms explained

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The latest home loan approval figures have found that variable rates have soared 73.92% from the month before, according to Mortgage Choice.
Variable rates accounted for 76.06% of home loans written in March, explained spokesperson for Mortgage Choice Jessica Darnbrough, who said this was unsurprising given the recent period of interest rate stability.
Darnbrough pointed to <a href="/expert-insights/finance/dwelling-prices-have-increased-significantly-rba-governor-glenn-stevens">the RBA’s comments of a prolonged period of interest rate stability</a> at their April board meeting yesterday, where they <a href="/expert-insights/finance/reserve-bank-holds-interest-rates-but-property-prices-make-an-increase-likely">kept the rate on hold</a>.
“With the Reserve Bank indicating that rates could stay on hold for the foreseeable future, borrowers are understandably, becoming increasingly comfortable taking out a variable rate mortgage,” she said.
“Moving forward, we expect demand for this type of product will continue to grow.”
The most popular of the variable rate products available are the ongoing discount rates, accounting for 43.71% of loans written through March.
Victoria saw the most borrowers keen for this type of home loan, at 81.25% of mortgages written. Meanwhile, Western Australia, South Australia, Queensland and New South Wales saw 78.47%, 77.52%, 75.05% and 73.18% of this type of loan written respectively.
“Regardless of what type of product you opt for, you can guarantee the mortgage will have a very sharp interest rate. Australia’s lenders are competing for business at the moment through aggressive borrower incentives and home loan pricing,” Darnbrough said.
To read more about interest rates, see Property Observer's most recent articles on the topic here.
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Fixed rates no longer favoured as borrowers turn to variable: Mortgage Choice

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The official cash rate set by the Reserve Bank of Australia has been at a historic low of 2.5% since August 2013. In line with that low rate, borrowers are paying less for home mortgages now than they have in over 15 years.
 <img src="/images/2014/03/28/zoe-march-28-one.jpg" alt="" style="line-height: 1.3em;"> 
Source: RBA
Lenders typically cut and lift mortgage interest rates roughly in line with the RBA’s movements, charging a margin over the official cash rates. Since late 2007, the extra amount of interest that consumers pay on a variable rate home loan above the official cash has been increasing.
Finder.com.au money expert Michelle Hutchison says lenders have been moving their rates out of cycle with the RBA and failing to pass on rate cuts in full, so the gap between the official cash rate and home loan rates available to borrowers has widened.
RBA data shows that the difference between the official cash rate and the mortgage managers’ basic variable rate – which approximates the average of interest rate actually available to borrowers – was fairly stable at just below 1 percentage point from September 1998 to September 2007. If that relationship still held true, home mortgages with variable interest rates of 3.5% and lower would be common in the market now.
In fact, RBA data shows that the mortgage managers’ basic variable rate was 5% in February 2014, a full 2.5 percentage points more than the official cash rate. Hutchison says the cheapest basic variable rate loan available is 4.49% for a $150,000 mortgage over 30 years from Loans.com.au.
 <img src="/images/2014/03/28/zoe-march-28-two.jpg" alt="">
Source: Reserve Bank of Australia
So, why aren’t headline lending rates lower?
Hutchison says one reason is that borrowers are letting lenders get away with charging more by not shopping around.
“If borrowers are not taking action and doing something about it by comparing home loans and switching to a better, cheaper deal, [lenders are] not going to do anything about it,” she says.
“There are hundreds of home loans on the market and the range of home loan prices is from 4.49% to over 9%. The best thing people can do is keep track of [interest rates]. Don’t sign up to a home loan and forget about it. Review your financial situation every year or two.” 
UBS interest rate strategist Matthew Johnson says few people pay the headline interest rates advertised by lenders. Advertised rates are higher in relation to the cash rate, but lenders have realised that people feel good about getting a discount. Those who are prepared to negotiate can get lower rates than the advertised rate.
Another key reason for the widening gap between the official cash rate and mortgage rates on offer to consumers is that the cost of funding and running a bank has gone up, Johnson says.
Two main sources of funding are available to lenders: financial markets and domestic deposits.
During the financial crisis, lenders found it very difficult and costly to borrow on financial markets as investors lost their appetite for risk. The banks were instead forced to tap local deposits to fund lending, using elevated interest rates on term deposits to lure consumers to save their cash.
As the chart below shows, the amount lenders had to offer on deposits over the cash rate increased dramatically from around 2007. Term deposit interest rates have fallen since mid-2012, but they are still high by historical comparisons. At-call savings account interest rates have remained above average.
<img src="/images/2014/04/01/zoe-april-1-one.jpg" alt="">
“Banks have shifted their funding base away from financial markets to domestic deposits. Banks have passed on a part of their increased funding costs to borrowers,” Johnson says.
Banks also consider credit risk associated with loans and the liquidity risk of funding long-term assets with short-term liabilities when setting interest rates, according to <a href="https://www.rba.gov.au/publications/bulletin/2014/mar/pdf/bu-0314-8.pdf" target="_blank">a report by the RBA</a>.
“Banks’ growth strategies, competitive pressures and the desire to provide a return to equity holders also affect banks’ lending rates,” the report noted.
“An important element in determining the overall cost of banks’ funding is the level of the cash rate, which acts as an anchor for the broader interest rate structure of the domestic financial system. Nevertheless, changes in the level of compensation demanded by investors to hold bank debt, competitive pressures and non-price factors can exert significant influences on banks’ funding costs.”
Johnson says the trend for lenders to charge a large premium over the cash rate will reverse as financial markets stabilise further and investors in financial instruments regain their appetite for risk.
House prices are rising and banks are well capitalised, easing investor concerns. Fund managers face a shortage of yield-producing assets. Under these conditions, and amid stabilising financial markets, demand will increase for yield-producing assets such as residential mortgage-backed securities (RMBS).
“That will again make securitisation [through RMBS] a viable funding strategy for the mortgage lenders,” Johnson says.
Non-bank lenders that lack the deposit-base of the big banks will be better able to compete as financial market funding costs fall, putting pressure on the banks to reduce their margins over the cash rate. 
But Johnson warns that might not lead to lower interest rates for consumers.
He says the wide margin between the RBA cash rate and mortgage rates is a big part of the story of why official interest rates are as low as they are now. The RBA has been compensating for the lenders’ higher costs, he says.
“If that [gap] goes back to 1%, then the official cash rate could rise,” Johnson says.
The RBA estimates in its report that even though funding costs have reduced over the past year, they are likely to remain close to 130 percentage points higher than they were before the global financial crisis.
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