Perth’s new apartment market recorded its strongest quarter of sales since Q4 2021, with 412 apartments sold in Q1 2026 and a record quarterly sold value of $537 million, according to Urbis’ latest Apartment Essentials results.

Urbis said the March quarter result reflects strong, highly product‑specific demand across both ends of the market, from more attainable projects delivering at scale, through to premium stock being absorbed by equity‑rich downsizers.&nbsp;

David Cresp, Partner at Urbis, said the key story in Perth is not demand, it is the market’s ability to convert demand into delivered housing.&nbsp;

“This is the strongest sales quarter since Q4 2021, and it reinforces that demand in Perth is real and it’s local,” David Cresp said. “But the task now is delivery, turning that demand into projects that can actually be built and completed.”&nbsp;

[smartcode_project:default project_id=110291 project_image_fid=302785]

<h2>Affordable product leads, premium demand remains resilient</h2>

Sales in Q1 were led by more affordable projects, with The Boulevard (SKS Group) recording 115 sales in the quarter, the presentation noting this is only the second time a single project has surpassed 100 quarterly sales. The project was able to offer more affordable housing product right next to a train station.&nbsp;

Palmyra West (Finbar) also delivered strong results with 28 sales in Q1, following 84 sales in Q4, with an average price of under $800,000, underscoring depth of demand for well‑located, attainable new stock.&nbsp;

At the premium end, Urbis said downsizer demand is continuing, with the results highlighting Romeo (Applecross, Finbar) recording 75 sales and reaching almost 50% sold in one quarter.

Jual (Shenton Park, Celsius Property) also posted a strong quarter with 28 sales, reaching 39% sold in one quarter.

Urbis noted that Perth apartment demand is not speculative, not investor‑led, and not uniform, describing it as localised, often equity‑driven and highly product‑specific, a pattern reflected in the polarisation between strong “attainable” performers and premium downsizer product.&nbsp;

[smartcode_project:default project_id=148957 project_image_fid=364102]

<h2>Prices underpinned by costs, and the delivery risk is growing</h2>

Urbis said pricing pressure is cost not demand‑driven: construction costs and delivery risk are now a central constraint, with the results noting build costs remain elevated and volatile, and that energy, fuel and labour uncertainty weigh on feasibility.

David Cresp said a growing challenge for private Build‑to‑Sell developers is simply securing a builder in the current environment.

“Developers are really feeling the pressure from a building market that was operating at capacity and securing a builder is challenging,” David Cresp said, adding that even where a builder can be secured, “trying to get to the price that makes the development financially viable is incredibly challenging in the current market.”&nbsp;

Urbis’ broader WA commentary also notes that industry remains at or above capacity with lot and housing creation, and that many builders are limiting new sales to manage stretched workforces and fixed‑price contract pressures, conditions that flow directly into apartment feasibility and delivery timing.

[smartcode_project:default project_id=108869 project_image_fid=317905]

<h2>Supply: improving later, but still constrained, and Perth lags eastern benchmarks</h2>

While near‑term supply remains constrained, Urbis’ forecast shows completions lifting “Supply is forecast to be back above 1,500 apartments per annum for the first time since 2019”, with 1,775 completions forecast for 2026, and volumes remaining above that level over the following years.&nbsp;

Looking further ahead, completions are forecast to reach 2,500 in 2028, with the report noting 32% of that total is social/affordable, reflecting the role of government‑supported delivery in rebuilding the pipeline.&nbsp;

However, Urbis said Perth remains behind comparable markets on pipeline scale. In a national comparison of projects under construction, the report shows under construction Perth Build‑to‑Sell (BTS) at 3,446 apartments versus the Gold Coast at 7,922. Mr Cresp said “The challenge for Perth is how to we grow the delivery pipeline”.

Urbis’ conclusion is that Perth’s market is increasingly defined by product discipline and delivery certainty, with the research identifying “delivery certainty is key” and calling out builder risk and procurement models as core success factors, alongside “timing and staging”.&nbsp;

Joel Robinson

Perth apartment sales hit strongest pace since late 2021 as builder capacity tightens

<a href="https://www.apartments.com.au/developers/sammut-developments">Sammut Group</a> has secured development approval for its latest Brisbane apartment project, marking the Sydney developer’s next step in expanding its Queensland pipeline following the success of its debut Gold Coast development, Coast.

The approved project at <a href="https://www.apartments.com.au/new-apartments/44-glen-road-toowong-qld-4066">44 Glen Road, </a><a href="https://www.apartments.com.au/developments/toowong-qld-4066">Toowong</a> will deliver a 15-storey riverfront apartment building with 42 residences, significantly increasing the scale of the site’s previous approval for a smaller luxury scheme. Designed by Bureau^proberts, the development will comprise a mix of predominantly four-bedroom and two-bedroom apartments positioned to maximise Brisbane River and city views.

Sammut Director Julian Sammut said the group had been actively searching Brisbane for several years before identifying Toowong as the right fit.

“Brisbane was the right step for Sammut,” Sammut said.

“With the success of Coast we thought we should definitely look to do more in Queensland alone. We then pushed up to look at Brisbane. We've been looking for I'd say two to three years actually and it was hard to find the right location.”

<img alt="Sammut makes Brisbane apartment play" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/f_auto,c_limit,w_1440,q_75/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/field/image/Screenshot%202025-12-23%20at%203.27.14%E2%80%AFPM.png?VersionId=dYAVIL7qdcGA8ojvkslSrLjczXFejSSx" />

Sammut said suburbs including New Farm and Teneriffe were considered before the group ultimately focused on Toowong due to its strong downsizer demographic and limited supply of developable riverfront land.

The site was acquired off-market after what Sammut described as a lengthy negotiation and planning process, with the developer pursuing an uplift to the original approval.

“We are DA approved now which is very exciting,” Sammut said.

“We've had our change approval come through and we've obviously doubled the height, 15 storeys plus rooftop. We've got 42 amazing apartments that are going to be coming to market soon.”

<img alt="Sammut makes Brisbane apartment play" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,dpr_2.0,q_auto:good/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202025-12-23%20at%203.27.26%E2%80%AFPM.png?VersionId=ohkRkY0dIZlqdfME2EZePsCQavRiBadE" />

Bureau^proberts said the design responds to Toowong’s evolving urban character, balancing contemporary apartment living with the area’s established residential identity.

“A place where traditional Queensland living has taken place for centuries; Toowong is seeing a shift of contemporary influence, commercial and retail hubs mixed with well-considered residential offerings – all the while maintaining its character and charm,” the architect noted in planning documents submitted to Brisbane City Council.

The architecture practice said the project’s form was shaped by its riverfront setting, flood considerations, neighbouring building scales, and view corridors.

“They said the mix of four and two-bedroom apartments capture the ‘fundamental qualities of Queenslander living,’ translated into the context of a contemporary subtropical building.”

The development sits just off Coronation Drive within walking distance of Toowong’s retail precinct and the upgraded Regatta ferry terminal, while also benefiting from proximity to the incoming green bridge connection to West End. Sammut said the accessibility and amenity offering were central to the site’s appeal.

The approval adds to growing residential activity along the Toowong riverfront, joining nearby projects including Consolidated Properties’ Monarch Residences and Spyre Group’s ARC Residences.

Sammut secures approval for debut Brisbane apartment development in Toowong

Developer Lanevick is heading back into Sydney’s apartment market after focusing more heavily on the luxury townhouse and terrace sector in recent years.

Lanevick, founded and directed by Steve Maroun, is expecting to receive approval in the coming months for a new apartment development in Gladesville, with the aim to launch it to the market later this year.

The 51-apartment project, designed by Studio Johnston, will comprise a mix of one-, two-, and three-bedroom apartments positioned toward the Hunters Hill downsizer market.

“Traditionally it’s been difficult for people in that market to downsize because there just hasn’t been the right product available,” Maroun said.

“We’re targeting buyers who might have 30 to 40 per cent of their house value sitting in the bank after downsizing.

“They still want good spacious entertaining areas, they still want quality design, but they also want flexibility and the ability to enjoy life a bit more after working hard for a long time.”

The project sits near Boronia Park and within close proximity to the Parramatta River foreshore, an area Maroun says offers more of a Hunters Hill lifestyle than a traditional apartment precinct.

“From a lifestyle perspective, it’s really more Hunters Hill than Gladesville,” Maroun said. “You’re close to the foreshore, close to parklands, and still connected back into the village precinct.”

From level four and above, apartments will capture water views&nbsp;toward Sydney Harbour. Communal amenity will include rooftop entertaining areas, wellness spaces, and a gym tailored toward owner-occupier buyers.

“We’ve really designed these apartments around that buyer coming from the Hunters Hill LGA and what they’re actually looking for in their next chapter.”

The proposed development has also been designed to respond to the changing character of the broader Gladesville town centre, where a growing number of mixed-use and residential proposals are expected to emerge over the coming years.

“Gladesville presented a rare opportunity to deliver a genuinely design-led residential project within an evolving lifestyle precinct, just moments from the growing Gladesville town centre, and we’ve approached the project with a strong focus on architecture, liveability and long-term community value,” Maroun said.

Maroun said Lanevick saw a first-mover advantage within the precinct as planning controls continue to evolve to accommodate greater housing density.

“We think there’s a real opportunity there that hasn’t really been serviced properly yet,” he said.

“There’s going to be a broader evolution of the whole Gladesville village precinct over time, particularly with more activation and mixed-use outcomes.”

The Venus Street proposal will include a commercial and retail component at ground level designed to contribute to that evolving streetscape activation.

“A big part of the thinking was how do you activate that area properly and create more vibrancy and amenity, which is what Hunters Hill has been looking for,” Maroun said.

Lanevick’s focus since 2020 has largely been on smaller-scale luxury townhouse and terrace developments. The developer recently completed Royale Randwick, also designed by Studio Johnston, where prices reached $3.65 million. The project was featured in the UDIA NSW 2026 Professional Development Prospectus and was also named a finalist for Development of the Year.

&nbsp;

Lanevick to cater for Hunters Hill downsizers with new Gladesville apartment development

Property developer One Living, backed by former Macquarie banker turned investment manager Chris Green’s investment firm, has unveiled plans to bring more institutional capital into housing to help address the national supply crisis.

The New York-based investor has focused his firm, GreenPoint Partners, on addressing the supply shortage hitting middle market housing in Australia.

It is backing the new One Living business to develop more than 1000 units along the eastern seaboard. The new firm is starting with a development on Mona Vale Road, on the border of Mona Vale and Pymble, in Sydney’s Northern Beaches, with around 140 apartments planned. They are eyeing off more sites across the city.

With cost pressures rising in the industry, One Living’s model is to be a vertically integrated developer-builder, so it can respond directly to the housing gap by removing the cost inefficiencies embedded in traditional residential delivery.

“We are building a platform designed to operate at scale and starting in a market where there’s a clear need for quality, attainable housing,” One Living joint managing director Joseph Scuderi said.

“It’s that missing middle – it’s that attainable end of housing… that’s what most Australians invest into and what Australians can actually afford.”

<img alt="Mona Vale" data-entity-type="file" data-entity-uuid="798dfa93-4941-4db6-a696-31e9dc18e81c" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-28%20at%202.31.50%E2%80%AFPM.png?VersionId=mKBqi5C_DmeiXS.AtJkcR8LQIxqCqmFi" />

GreenPoint Partners brings years of experience assembling and scaling real estate operating businesses across major markets. And Green sees a big opportunity in Australia.

“For its size, sophistication and importance to the community, Australia’s living sector has remained largely under-institutionalised, which represents significant opportunity,” Green said. “GreenPoint identified that gap, assembled the right team, and is backing One Living to build a platform that is aligned to market needs.”

Green said being a builder-developer would give the company the capacity and flexibility it required to deliver reasonably-priced homes.

“We want it to be at that attainable level; not super high end luxury but at that attainable level,” he said.

<img alt="Mona Vale" data-entity-type="file" data-entity-uuid="74a5344a-4b26-4d4a-ada3-056b1220be77" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-28%20at%202.32.15%E2%80%AFPM.png?VersionId=vY8hXHO4reBMdO8ZXMWCNtGZJofUPQ3j" />

&nbsp;

One Living will undertake a component of affordable housing in its schemes, which it will own and operate, and it could also run build-to-rent on some sites.

Green praised local policy settings.

“The NSW government is being very supportive, strategic and pragmatic in terms of how do we generate more supply of housing,” he said. “We think it’s actually positive for development and the bit that’s been lacking at that attainable level is that it’s lots of relatively small private developers, whereas we want to create an institutional platform.”

One Living is also&nbsp;looking at high-density projects and could take on more institutional funding in the future.

“The way we will be able to achieve economies of scale is through size,” Green added.

One Living enters Sydney's new apartment market with Northern Beaches site acquisition

It's been several years since there's been an opportunity to buy a brand new townhome in Melbourne's coastal suburb of Mordialloc. Even apartment developments in recent times have been few and far between in the area.

Local developer LDS Property identified the gap in new housing, securing a site on White Street, directly opposite&nbsp;Woodlands Golf Club Mordialloc. They've recently launched&nbsp;<a href="https://www.apartments.com.au/new-townhouses/wm-residences-mordialloc-102-white-street-mordialloc-vic-3195">WM Residences</a>, just 13 townhouses which they have already started building.

Projects by Buxton Director Heath Thompson, who is selling WM Residences, says the townhouses x that perfect middle ground be

"Mordialloc residents have had limited options to downsize within the suburb, often forcing them to look elsewhere despite long-standing ties to the area," Thompson says.

"With very little comparable new supply coming to market, projects like WM Residences are well placed, particularly as buyers look to capitalise on current conditions amid constrained supply."

[smartcode_project:default project_id=134646 project_image_fid=6109]

The development, designed by regarded architecture firm&nbsp;<a href="https://www.apartments.com.au/architects/ewert-leaf">Ewert Leaf</a>,&nbsp;adopts a deliberately restrained architectural approach, focusing on simplicity, durability and liveability rather than overt design gestures.

The boutique scale is central to the offering. With only 13 three-bedroom residences, each home is configured to prioritise functional layouts and everyday use, supported by private terraces and secure two-car garages.

Ewert Leaf’s design response leans into a calm, neutral material palette. Interiors are defined by oak flooring, white walls and soft finishes, creating a consistent and understated backdrop. The approach avoids trend-driven detailing in favour of longevity, with an emphasis on natural light and spatial clarity.

[smartcode_project:default project_id=134646 project_image_fid=6110]

Beyond aesthetics, the homes are designed to meet contemporary performance expectations. Each residence targets a minimum 6-star energy rating, incorporating double glazing, comprehensive insulation and all-electric Bosch appliances.

The project’s location supports a walkable coastal lifestyle, sitting within close proximity to Mordialloc’s foreshore, Main Street retail strip and the train station. Local cafés and dining venues, including Suburbia Deli and Hendriks Café, are within a short walk, reinforcing the area’s established neighbourhood character.

[smartcode_project:default project_id=134646 project_image_fid=6116]

While <a href="https://www.apartments.com.au/developments/mordialloc-vic-3195">Mordialloc</a> is often defined by its beach and pier, the project taps into other areas of day to day living, offering easy access to local food, casual dining and transport, rather than positioning itself purely as a lifestyle retreat.

WM Residences reflects a continued trend across Melbourne’s coastal suburbs towards smaller-scale, design-led townhouse developments, particularly on infill sites where proximity to amenity is already established.

With construction commenced prior to its market entry, the project aligns with a growing preference among buyers for developments with visible progress and defined delivery timeframes.

[smartcode_project_cta:default project_id=134646]

WM Residences fills gap in Mordialloc townhouse market

Housing Affordability

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GUEST OBSERVER
We need to get creative on the solutions to housing affordability.
Focusing on first home buyer and retiree activity is critical to literally get NSW moving again as the figures are so compelling.
Sales activity in many parts of Sydney has dropped by over 30 percent in the past 10 years, whilst the population has grown by over 15 percent.
This is not a good story and when you consider we are slipping behind on new construction at the rate of 5,000 dwellings per year, a fast turnaround is critical. We need to greater flexibility in town planning to provide the types of dwellings that will entice people to move, not just the high rise jungles solution currently on the table.
Vibrant integrated communities around infrastructure and transport hubs are essential to long term community benefit, where low cost housing solutions and both retail and commercial interests are side by side with mixed low, medium and high density residential living. It’s not hard to achieve but it requires vision and resolve to make it happen and happen quickly.
Queensland and Western Australia provide interesting examples as to how Governments can address affordability. Both states lowered stamp duty, reducing a major deterrent to people relocating, which saw people moving to new homes more frequently as their living requirements changed.
The net impact on Government revenue overall was negligible but the opportunities for first home buyers were given a boost.
By assisting those living in largely empty family homes, perhaps close to retirement or on a pension, Government has an opportunity to free up stock.
With presumably no mortgage these people are asset rich, however under the current system if they wanted to sell, all they would achieve is a reduction to their asset base and possible loss of entitlements by having too much money in the bank.
If the cost for people to move to smaller homes was reduced, ideally by removing stamp duty for retirees and ensuring sale proceeds aren’t means tested, more people would bring their properties to market and thereby increase supply.
Encouraging new supply is a central solution to addressing the affordability issue. While the NSW Government is making a conscious effort to provide new housing, this attracts investors because the depreciation on a new build is significant.
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Without discouraging investors, who play an important role in a diverse market, we need to investigate new ways to help those serious about a first home purchase. Simply waiting for prices to drop is insufficient and may lock would-be first home buyers out of the market forever.
For too long both state and federal governments have stuck their heads in the sand on the affordability issue - and when the market takes off like it has the past three years they “cry wolf” and start looking for band-aid solutions.
There is no singular quick fix because the horse has bolted in NSW due to 10 years of inaction.
However there is still hope and it will need a co-ordinated response from both federal and state governments working with the construction industry and all property industry stakeholders to get an equitable duty and tax regime in place to incentivise more activity in both established and new housing.
John Cunningham is president of the REINSW and can be contacted <a href="https://www.reinsw.com.au/imis15_prod/" target="_blank">here</a>.
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jchancellor-FAypfDUnLy

We need to get creative on the solutions to housing affordability: John Cunningham

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GUSET OBSERVER
With property prices typically viewed as the crux of the affordability problem, and little able to be done on this score, new ideas are needed to open the door to first home buyers - and targeting up-front costs is the place to start. 
While much has been written about the huge burden of stamp duty, particularly in NSW, Ms Pilkington nominates mortgage insurance as an area that could also be addressed to give first home buyers a more realistic chance of entering the market. 
Enabling first home buyers to negatively gear a percentage of their mortgage – even just a small one – is another opportunity to address affordability.
A 10 percent deposit on a Sydney property is a significant amount of money but when you factor in mortgage insurance, legal costs and initial home insurance, on top of the exorbitant cost of stamp duty, it’s no surprise so many first home buyers are disheartened. 
The various up-front costs mean the numbers fail to add up for many first home buyers. It’s at this point the excitement dissipates and stress takes over, and many looking to enter the market simply bow out, assuming they’ll never have enough. 
That’s why it’s at this point we need to help first buyers navigate a successful purchase.
Mortgage insurance is an important safeguard but questions the methodology of paying an up-front one-off lump sum. 
Most insurance policies are paid annually on an as-needed basis. There is no reason this couldn’t be applied to mortgage insurance too. 
One Laing+Simmons franchisee was recently working with a customer who had to pay over $8,000 in mortgage insurance up-front as they only had a 10 percent deposit. The property subsequently rose in value by 10% over the next six months, meaning their equity was now 20% and they therefore had no further need for mortgage insurance. 
Yet they had already incurred the cost - a cost that could, and should, be avoided.
The number of times an insurance company has to pay out on mortgage insurance is not in line with the amount they charge. 
Aside from a fairer approach to mortgage insurance, Ms Pilkington says Governments could also explore how negative gearing could help first home buyers. 
Under certain conditions, perhaps we could enable first home buyers to access negative gearing on the home they live in, even if it was only for a small percentage of their mortgage. 
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For example, first home buyers might negative gear a percentage of their loan for a fixed period of time which would lower repayments and, like any property negatively geared, the Government could claim some sort of capital gains tax when they sell. 
Any options to improve the tax effectiveness for home ownership to support first home buyers could be considered.
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Leanne Pilkington is managing director, Laing+Simmons and can be contacted <a href="https://www.lsre.com.au/home" target="_blank">here</a>.
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New angles on the affordability issue: Leanne Pilkington

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Housing affordability is not a new problem, and as the Federal Treasurer Scott Morrison pointed out, it has actually never been easy to buy a home, especially in our major metropolitan areas.
Housing affordability will be an important policy focus of the Turnbull Government. And to try to get it right, the Federal Treasurer gave a 4400 word speech last week to outline some of the issues.
"As we move forward it is important to properly diagnose the problems we are trying to solve," he said. 
He noted when combining both outright ownership and those paying off a mortgage, the proportion of Australian households that own their own home has fallen from 71 per cent to 67 per cent over the past two decades, so there is a certainly a trend there.
He did stress the increase in Australian house prices has largely been driven by fundamental determinants.  
"Australia's housing markets may be expensive, but in aggregate they are substantively sound, reflecting the natural tension between the forces of supply and demand," he said.
I took five nuggets from the speech which are concerning, but which highlight the complexity of it all.
1) Between June 2010 and June 2015, the time taken for a dual income couple to save for a 20 per cent deposit in Sydney increased from 5.8 years to 7.9 years. In Melbourne it increased from 5.3 years to 5.8 years. However, outside NSW and Victoria, the change in the number of years to save for a deposit actually fell, showing the impacts are not even across the country. 
2) Home ownership rates are falling across all age groups, not just young Australians. Between 2002 and 2014, Australian home ownership among 25-34 year olds declined from 38 per cent to 29 per cent while for 35 to 44 year olds it fell from 63 per cent to 52 per cent.
3) When we look at the change in home ownership by state, the largest falls over the last twenty years have been in Queensland and Victoria, rather than NSW.
4) The percentage of purchasing households aged under 44 that are dual income has risen from just over 50 per cent in 1981 to more than 80 per cent in 2011, while the proportion of single income households fell from around 50 per cent to less than 20 per cent over the same period.  
5) The proportion of home owners aged over 45 with a mortgage has increased significantly over the past 20 years. It's taking longer to be free of the mortgage with the trend having the potential to undermine retirement incomes.
Morrison noted the challenge of not being able to access secure housing has flow on effects to many other policy areas. It impacts health, work force participation, social cohesion, welfare dependency, family formation and household consumption to name a few.
Morrison concluded that of all the determinants of house prices in Australia, whether cyclical or structural, "the most important factor behind rising prices has been the long running impediments to the supply side of the market."
Some argue with that conclusion seeking him to look at the impact of overseas migration which was not addressed, although he did note between 2005 and 2010, Australia had the highest average rate of overall population growth in the OECD, except for Israel.  
As there is no single housing market in Australia, there will however never be a single solution.
This article was first published in the Saturday Daily Telegraph.
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Five concerning housing affordability issues

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The solution to Sydney’s affordable housing problems is contained in the existing legislation and recommendations of the Affordable Housing Taskforce as outlined on the Department of Planning’s website.
The Affordable Housing Taskforce report to the Coalition Government in 2012 clearly stated that the private sector will not enter the affordable housing market without incentives (Action 5).
The Affordable Housing Taskforce report said ‘These incentives have been particularly attractive where the bonus represents significant value’(Cl 4.12). 
The Taskforce report supported the principle of the Affordable Rental Housing State Environmental Planning Policy (SEPP) as a good way to generate affordable housing.
The Urban Taskforce, representing property developers, has presented to the NSW Government a clear strategy to produce 40,000 affordable homes over a 10 year period by slightly changing the NSW Government’s current incentive in the Affordable Rental Housing SEPP.
The current Affordable Rental Housing SEPP is based on rental housing being for a period of 10 years through ‘a restriction on the occupation certificate against the title of the property’ (Cl17) and the Urban Taskforce proposal uses exactly the same definition.
Since the Affordable Rental Housing SEPP was introduced a relatively small number of affordable homes have been produced because the incentives have been too low. With a lifting in the incentives thousands of affordable housing homes can be built in metropolitan Sydney.
The Coalition Government’s Taskforce raised concerns that inclusionary zoning would only work where land value was high. ‘Inclusionary zone policies have been shown to work most effectively in high value land locations and have limited application in lower cost markets.’ (Cl 4.14). The Urban Taskforce approach is an incentive that is adjusted to all suburbs irrespective of land value.
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It seems that the approach now preferred by the Greater Sydney Commission is to force inclusionary zoning as a tax on new housing development. While this may work where land value is high, like Vaucluse, it is unlikely that the suburbs that really need affordable housing will benefit.
The Urban Taskforce is keen to work with the NSW Government to generate thousands of new affordable homes across Sydney. To simply force a new tax on the development industry in Sydney will act as a disincentive on the private sector to provide homes. By default it will be the NSW Government who will need to provide massive numbers of affordable homes.
Chris Johnson is chief executive officer of property development industry group Urban Taskforce and can be contacted <a href="https://www.urbantaskforce.com.au/index.php?option=com_content&amp;view=article&amp;id=97&amp;Itemid=126#.Vdaart55dFI" target="_blank">here</a>.
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Affordable housing solution for Sydney is contained in Planning Department Policies: Chris Johnson

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GUEST OBSERVER
Scott Morrison is a “once bitten, never shy” sort of guy. Having had a bad experience in the high profile debate over whether to change the GST, which ultimately came to nothing, the Treasurer this week launched into the hot topic of housing affordability.
The question is, can he and the government manage the issue or will it, too, turn on them?
With tax, the then-new Turnbull government put “everything on the table”, only to produce a package limited in scope and reform. Even the centrepiece of that - a company tax reduction over a decade – will have to be pared back to pass the Senate.
The opposite approach is being brought to housing affordability. Morrison wants to confine what’s put on the table to the supply side. Attacking demand would crash the market, he says. So in his Monday speech to the Urban Development Institute of Australia he focused on the need to cut planning regulations to free up land.
But the pressure is strong for a broader discussion.
Morrison’s address had plenty of statistics illustrating the problem. Over the past 20 years the proportion of Australian households owning or paying off their home has fallen from 71% to 67%; the proportion of home owners over 45 with a mortgage has risen significantly.
As Morrison said, “the real pinch point” is breaking into the market. “Across the country, a 20% deposit on the nationwide median home loan is more than 100% of annual household disposable income … well above the 60% levels that were the norm prior to 2000.” The proportion of home loans to first home buyers was 13.4% in August, the lowest since February 2004; this compared with the long term average of 19.4%.
Morrison noted that the housing issue had implications for retirement incomes. If it takes longer to pay off your mortgage, you can save less for later, or perhaps eventually need to use some of your superannuation to clear your house loan. He didn’t observe, but it is also true, that many younger people facing the challenge of getting together a deposit will also have the burden of starting to pay back student debt.
Malcolm Turnbull is said to be very anxious the government search for solutions to the affordability challenge. Expert opinion and common sense indicate this search should be as broad as possible, looking at the demand as well as the supply side.
The government knows this. Before the last election it considered imposing some restraint on negative gearing. But, wanting to sharpen the contrast with Labor, which proposed bold changes to negative gearing and capital gains tax, it did not go ahead.
Thus its attempt to put the affordability issue into the straightjacket labelled supply - with emphasis on regulations that are state and local rather than federal government responsibilities - is very political, when what’s needed is an open-minded quest for the best evidence-based policy.
Already the containment is being resisted.
Last term the government had a parliamentary inquiry underway by the House of Representatives economics committee into home ownership, chaired by Sydney Liberal John Alexander. Alexander was moved to another committee; by the time of the election the inquiry had not reported. Post-election Turnbull, hosing down another problem, had the economics committee divert onto quizzing bank CEOs.
Now Alexander wants the housing inquiry reconstituted under his House committee on infrastructure, transport and cities. That would make a lot of sense - much work was done and shouldn’t be wasted. Alexander wrote to Morrison in September seeking the reference, but hasn’t heard back yet.
This is a nice dilemma for Morrison. Alexander is widely on the record arguing the demand side is important and, what’s more, that investors are making it hard for young first home buyers. The evidence indicated “investors were trampling on the opportunity for people wanting to buy a first home”, he says.
Alexander believes there is a case for tweaking negative gearing - though he does not support Labor’s policy which would have been “catastrophic” - and for looking at capital gains tax provisions. He describes negative gearing as an “incredibly dynamic tool” and likens it to a high-powered car that needs to operate within a speed limit.
He says the policy objective should be a gradual transition “to maximum home ownership” and a reduction in “speculation and opportunism” in the market.
Not only does the government have to decide about the parliamentary inquiry but Morrison has said he will take up the issue of freeing up planning regulations with state treasurers when they meet in December.
This can be seen as pushing the issue onto the states. The perennial debate has also re-opened about how a shake up of state taxes could help.
Morrison faces the risk of perceived failure if the federal government raises expectations then little happens. Even if the states pledged to regulation reform, results would come in the medium term.
The other danger for Morrison and the government is that opening up the housing affordability issue is moving the play onto Labor’s ground. The opposition’s position on negative gearing doesn’t seem to have cost it votes on July 2. It gets the opportunity to run it again, arguing that it has a ready-made policy to respond to the problem the Treasurer has put right at the centre of the political agenda.
Michelle Grattan<a href="https://theconversation.com/profiles/michelle-grattan-20316" rel="author"></a> is professorial fellow, University of Canberra and author for The Conversation. She can be contacted <a href="https://theconversation.com/profiles/michelle-grattan-20316" target="_blank">here</a>.
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Morrison opens housing affordability debate but can he control it?

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Housing affordability, rather the lack of it, doesn’t seem to be going away anytime soon, and Treasurer Scott Morrison’s recent speech at an Urban Development Institute of Australia event just reinforced the view.  
In such a scenario, the ‘bank of mum and dad’ for first-home buyers might be the way to realise the ‘great Australian dream’.
With the apartment median price in Sydney around $850,000, and Melbourne not too far behind, saving for even that 10 percent or higher deposit is a tough task for the new kids on the property block.
Normally, when a borrower can’t meet a 20 percent deposit and stamp duty, the bank will impose a Lenders Mortgage Insurance, which adds up to a few thousands of dollars. 
The ‘bank of mum and dad’ can seem to be a good option in such circumstances.
Ask a parent how far they would go to support the financial aspirations of their children, and chances are they will say: “Yes, if I had the money I would be happy to act as a guarantor for my children to purchase a property.” 
According to Todd Hunter, founder and director wHeregroup, mum and dad can help their children — even when they are teenagers — get a head start into the property market by buying a cheap property in the right location and let it sit there for 10 or 20 years and grow in value. Once the property is sold, the children will have a ready-made deposit without asking parents for help.  
Cheap properties below $250,000, and they don’t have to be in the city. And cheap properties because they “tend to pay for themselves, meaning the rent pays the interest on the loan, so any extra payments they make go directly off the principal of the loan”.
While this may be a great way to get the next generation started in property, there’s also a rising trend for adult children who are already property owners to dip into the bank of mum and dad besides the first-home buyers, according to Mortgage and Finance Association of Australia (MFAA) director and managing director of smart lending Melissa Gielnik in an article in www.domain.com.au earlier this year.
“In the past three years brokers across the MFAA network have witnessed a spike in requests for these types of loans and expect this trend to continue. Parental guarantee loans represent over 15 per cent of loans written for some brokers,” Gielnik said.
“As the housing market continues to grow parental guarantees are becoming more popular with upgraders allowing them to avoid mortgage insurance and therefore borrow a larger amount,” she said.
Housing is the single biggest asset class in Australia, worth an estimated $6.5 trillion across 9.6 million dwellings, according to CoreLogic. To put it in perspective, this is worth more than three times the value of Australian superannuation funds ($2 trillion) and more than four times the value of Australian listed stocks ($1.5 trillion).
But roping in parents to guarantee loan doesn’t come without risks, as Mamiza Haq, a lecturer in finance at The University of Queensland, points out in an article in <a href="https://theconversation.com/the-problems-with-relying-on-the-bank-of-mum-and-dad-33826" target="_blank">The Conversation</a>. 
The risk to lenders
Family-pledged loans can be categorised as non-conforming loans, an area where lenders seek to minimise the level of risk as much as possible. The Australian Prudential Regulatory Authority has outlined some guidelines for Authorised Deposit-Taking Institutions (ADIs) with regard to loans including a guarantor relationship (e.g. from a parent of the borrower) as these loans carry a greater risk. 
Inadequate bank supervision and poorly underwritten home mortgages led to the financial crisis, adds Haq. 
Sydney mortgage broker Elaine Lam explains in an article in The Australian that while “a family guarantee can be a useful tool that allows borrowers to finance property with little or no deposit, the procedure can be a risky strategy as it allows borrowers to buy property with no cash and no evidence of genuine savings, as long as the bank is satisfied the borrower can meet the ongoing loan repayments, says Lam. In the event the borrower defaults on the loan, the bank will come after the parents for any losses and costs that the bank incurs.
Consumer advocates also cite “lots of cases" where guarantors have been faced with the prospect of losing their home, adds Haq.
In the current uncertain economic climate with low wage growth and rising costs of living, parents must consider the risks of acting as guarantor, and all the legal responsibilities that come with it, before pitching in to help your children realise the ‘Australian dream’.
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jonathanchancellor-7SQnKwU6yx

Bank of mum and dad: Some pros and cons

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There are few real estate activities more depressing than observing a media debate about housing affordability.
It’s a downer because it’s clear from the rhetoric that this nation is unlikely to ever achieve any kind of resolution of the issue.
There are four reasons: (1) the politicians don’t understand it and/or are unwilling to do what’s needed; (2) industry people who do understand it champion their vested interests rather than the national interest; (3) everyone else has their heads full of misinformation, political agendas and unhelpful emotion; and (4) most discussions focus on Sydney prices and ignore the realities in other parts of Australia.
The outcome is mishmash of misconceptions, myths and outright lies. Nothing useful is ever achieved.
A recent discussion of ABS TV program The Drum was representative of how bad it gets. None of the people at the discussion table had any knowledge on the issue and simply indulged their prejudices and personal agendas. One spectacular twit claimed no one can get into the housing market any more because you need a $200,000 deposit to buy a typical house. Not even in Sydney is that remotely close to the truth.
The so-called affordability crisis is never far from the headlines and it stepped up in prominence this week with Federal Treasurer Scott Morrison declaring he was serious about fixing the problem. But of course he wasn’t serious at all. He essentially dumped the problem at the feet of state governments, with a generalised assertion that taking steps to increase dwelling supply will make everything better.
That’s one of the subject’s biggest furphies – a simplistic policy of lifting supply won’t force down prices unless the idea is to deliberately generate a major oversupply. One thing Morrison got right was his statement that you won’t fix the problem by crashing the market.
As a general observation, we don’t need more dwellings in Australia. We’re already building far too many apartments, which will result in falling values, but only in specific areas such as the inner-city unit markets of Melbourne, Brisbane and Perth, as well as surfside Gold Coast. This runs contrary to the statement by Malcolm Turnbull this week that “we simply haven’t been building enough dwellings” – which shows how little he understands about the situation.
Federal Labor responded with its standard party line that restricting tax benefits for investors will make housing affordable again – despite the assertion by leader Bill Shorten that his policy won’t cause house values to decline (so therefore how will it make housing more affordable?). And that, sadly, is the extent of his understanding of the issue.
There followed lots of finger-pointing, with each level of government blaming another level of government for the perceived problems, and each side of politics scapegoating their opponents.
Industry lobby groups leapt at the opportunity to advance their pet causes. Master Builders Australia agreed, naturally, that a big lift in new home construction would be the solution, but argued that politicians needed to make changes to make it really attractive for developers and builders. The Urban Taskforce declared that developers would be happy to build lots of affordable homes, just so long as government handed them plenty of financial incentives. 
As I’ve often commented, the biggest noise in real estate is always the voice of vested interest.
Even in Perth, where there is vast oversupply and high vacancies right across the metropolitan area, the Urban Development Institute of Australia urged the WA State Government to take steps to increase housing supply. 
To paraphrase Shakespeare, they were all tales told by idiots, full of sound and fury, signifying nothing.
The problem is that none of solutions put forward will make the required difference. They’re all targeting the wrong villains.
Everyone has a theory on who’s to blame for rising prices: some say foreign investors, others claim Australian investors, a few proclaim it’s first-home buyers pumped up by government incentives and still others, including former federal minister Bob Carr, reckon it’s the high level of overseas migration into Australia.
Who’s right? Well, none of them. The real culprits are never mentioned.
The biggest single force in driving house prices comprises the market sector known as next-time buyers –i.e. home-buyers other than first-home buyers. Numerically they’re the biggest chunk of the market and they’re aspirational. They have the financial capacity and ambition to pay top dollar to secure the property they’re obsessing over.
Investors, generally, don’t do that and first-timers can’t afford to.
But there’s an even bigger villain, one the politicians never mention while they’re busy pointing their fingers in various other directions - because the biggest problems are caused by the politicians themselves.
The value of homes in Australia is under-pinned by their replacement cost – i.e. the high cost of creating new house-and-land packages, the biggest chunk of which comprises taxes, fees and charges from all three levels of government.
As long as local, state and federal governments treat the housing industry as a beloved cash cow, housing will remain pricey in this country. Most of the state budgets handed down this year made the problem worse by adding to housing costs. 
You can build as many new houses as you like, but developers can’t sell them for $250,000 if they cost $400,000 to create.
Federal politicians recently conducted an inquiry into the affordability issue, which took a lot of time, cost of lot of money and achieved absolutely nothing. The Federal Government made a show of clamping down on foreigners illegally buying mansions, but that has changed nothing for first-home buyers 
Last year another inquiry was initiated by the House of Representatives economics committee but, according to reports this week, that has lapsed through lack of energy.
So where are we after all that “sound and fury”? Exactly the same place we were before Scott Morrison stepped up to the microphone – nowhere closer to any solutions.
Terry Ryder is the founder of <a href="https://www.hotspotting.com.au/" target="_blank">hotspotting.com.au</a>. You can <a href="https://mailto:ryder@hotspotting.com.au" target="_blank">email him</a> or follow him on <a href="https://twitter.com/hotspotting" target="_blank">Twitter.</a>
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terryryder-YECXbqmri2

We don’t need more dwellings in Australia

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The Federal Government has let its housing affordability inquiry lapse.
News of the quashed inquiry emerged through Fairfax Media's commentator Peter Martin as Treasurer Scott Morrison delivered a speech in which he declared housing affordability to be an "important policy focus" of the Turnbull government in the new parliamentary term.
The inquiry was initiated by Morrison's predecessor, Joe Hockey early last year to be undertaken by the House of Representatives economics committee and chaired by Liberal backbencher John Alexander.
Alexander was replaced as chairman by Liberal MP Craig Laundy after hearings concluded in September last year.
Mr Laundy has told Fairfax Media he had worked on a draft report with the committee secretariat.
But he wasn't able to put it to the committee before he was promoted to the ministry and replaced with backbencher David Coleman shortly before the July election.
Under the rules governing committees, the inquiry lapsed with the election, meaning Mr Coleman is unable to conclude the report without a fresh referral from the Treasurer.
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Federal Government lets housing affordability inquiry lapse

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GUEST OBSERVER
The Property Council of Australia has welcomed the release of the government’s draft revision of the South East Queensland Regional Plan. 
The refresh of the State Government’s seven year old regional land-use plan is an important moment for industry, councils and the broader community alike. 
The goal of the regional plan is to outline how future growth can be accommodated in a manner which maintains the enviable way of life for South East Queenslanders.
While it’s certainly not everything the property industry feels is required, it does appear the State has taken onboard a number of the recommendations we have made during the consultation process. 
These included a commitment to greater monitoring and reporting against the plan, a strategic assessment of environmental values and focus on delivering employment as well as housing across the region. 
The property industry will now be sifting through the detail of the draft to test the underlying assumptions and determine if the Government’s approach is realistic.
The Government has proposed a shift towards more infill development to meet future housing demand, with a new target of 60 percent infill and 40 percent greenfield over the next 25 years. 
What the industry wants to deliver is a wide range of housing choice for South East Queenslanders.
South East Queensland will need considerably more of every type of housing over the next 25 years, whether it is apartments, new homes, retirement villages or student accommodation. 
We will be analysing this nominal infill target to ensure that it doesn’t create any artificial constraint on the delivery of new houses, and have a corresponding impact on affordability. 
The proposed modest expansion of the urban footprint isn’t anything revolutionary, but it acknowledges that growth is inevitable and Government’s role is to appropriately cater for it in a sustainable manner. 
As industry pours over the detail, we will be looking to ensure that each community in SEQ has its own adequate supply of future housing and employment lands.
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A strategic region-wide assessment of environmental considerations has been flagged by the Government in the plan as the way forward to achieve an evidence-based approach to ecological protection. 
Industry strongly supports the push to identify with certainty those areas that should be protected from urban uses, and those areas where urban uses are agreed to be the highest and best use of the land.
This will not only reduce red tape, but also achieve far better environmental outcomes.
Public consultation on the draft plan will run until 3 March 2017. It is expected that the final plan will come into effect in mid-2017. 
Once the document is finalised, the Government must take the leadership role in ensuring that their plan doesn’t gather dust, but is implemented on the ground.
This will mean sitting down with local governments to understand what impediments exist to ensuring this land is delivered to market as quickly as possible. 
Given the plan’s emphasis on infill development, this leadership role will also mean offering greater support to local governments over contentious infill projects.” 
The Property Council has called on the Queensland Government to establish a $200 million Regional Project Fund to assist local governments in financing key infrastructure that will enable them to translate the new South East Queensland Regional Plan (SEQRP) into their local planning schemes. 
As our population grows, so too will the demand for housing. If we want to ensure South East Queensland is an affordable place to live into the future, we need to unlock new housing supply to match this demand.
Chris Mountford is Queensland executive director of the Property Council and can be contacted <a href="https://www.propertycouncil.com.au" target="_blank">here</a>.
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South East Queensland Regional Plan refresh moves towards infill housing development

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A block of 12 one bedroom apartments fronting Barangaroo Reserve in Millers Point has been listed for sale by Property NSW, on behalf of Family and Community Services.
The block is comprised of both heritage and modern apartments, and will be sold as one property.
The property is located on the corner of Merriman and Bettington Streets, with views of the western harbour, Harbour Bridge and the city skyline.
Any purchaser will need to adhere to the NSW Heritage Council-endorsed Conservation Management Plan (CMP). The CMP provides extensive detail on the types of works that are permitted on the property.
The property will be auctioned through Ray White and McGrath Estate Agents on November 30.
Proceeds from the Millers Point sales program will fund 1,500 new social housing dwellings across the State, with more than 600 new fit-for-purpose social housing dwellings funded to date.
A total of 103 Millers Point properties have so far been sold, delivering circa $280m for reinvestment in social housing across NSW.
The new block joins 15 other properties currently listed for sale, including 13 three-bedroom apartments in Windmill Street and duplex properties at 3 and 9 High Street.
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Housing Affordability

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