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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The opening statement made by Lindsay David for the House of Representatives Standing Committee on Economics Inquiry into Home Ownership.
To be frank, the evidence suggests that on the back of irrational exuberance, Australia is experiencing what can only be described as a classic debt-financed speculative housing bubble with every metric that evidenced the bubble in the US and Ireland present within our economic system today.
To put things in perspective, between the June quarter 1996 (when real housing prices first began to rise) and the December quarter of 2014, real housing prices rose by approximately 131%.
But over this same period, inflation rose by 60%, our population grew by 30%, real GDP by 79%, real rents by 21% and real household income by 39%. In short, the growth of housing prices has completely outstripped all economic fundamentals except for the expansion of household debt.
Over the same period, total household liabilities boomed from 54% relative to GDP to 118%. And today, Australian households now owe creditors close to $2 trillion and rising. Never has our household sector been as indebted as it is today.
Between 2002 and mid-2015 the mortgage books at the Big 4 banks, NAB, ANZ, CBA and Westpac grew by 388%, 435%, 475% and 554% respectively.
In 2002, just the size of the mortgage books at the Commonwealth Bank and Westpac combined was equivalent to 18% of GDP. Today, its stands at 44% of GDP and continues to rise.
In 2002, the mortgage book of Westpac suggests that for every dollar it had loaned to an owner occupier, it had lent 45 cents to property investors. By April 2015, the proportion rose to 81 cents.
It is truly surprising these patterns of rapid growth have not been of profound concern to the RBA, APRA or Treasury over this thirteen-year period for where data is freely available and states the blatantly obvious.
Australia has spent the better part of fifteen years avoiding the primary reason as to why house prices have boomed above fundamentals such as rents, incomes, inflation and GDP – which happens to be debt-financed speculation.
Our grossly undercapitalized, overleveraged, foreign funds-reliant banking system has artificially stimulated demand for real estate in what is an unaffordable market by consistently lending irrational sums of debt to owner-occupiers and investors. The public is also caught up in a mania of irrational exuberance, which combined explains why housing prices across Australia are as high as they are today. The evidence outlined in our submission suggests this to be the case.
To put it into perspective how expensive land is across Australia, you can find cheaper blocks of land per square meter on the hills of Malibu, California with a view of the Pacific Ocean than you can find in locales like Alice Springs or St Marys. Representatives, this is not normal, and quite frankly, laughable if the matter was not so serious.
For too long, Australian policymakers with authority and regulatory power have ignored all the warning signs pointing to a credit-fuelled housing bubble. Yet, over the years have implemented various policies to stimulate the price of housing and the rapidly growing risk home owners and property investors accumulate in order to keep house prices abnormally high whilst making various interventions that stick out like a sore thumb every time household credit expanded below a perceived comfort level.
LINDSAY DAVID is the author of <a href="https://blog.australiaboomtobust.com/2015/02/lindsay-davids-new-book-print-central-bankers-bubble-now-available/">Australia: Boom to Bust and Print: The Central Bankers Bubble.</a> David holds an MBA from IMD Business School and recently founded <a href="https://www.lfeconomics.com/about">LF Economics</a>.
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LindsayDavid-WEhfyLvNJJ

A classic debt-financed speculative housing bubble: Lindsay David

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The Opposition has again slammed Treasurer Joe Hockey's latest crackdown on foreigners owning Australian land, describing it as a diversion from tackling housing affordability.
Mr Hockey announced the forced sale of six homes around the country. 
Three of the properties were in the Sydney suburbs of Eastwood, Fairfield and Mosman, two were in Kewdale in Perth and the other at Eight Mile Plains on the outskirts of Brisbane.
There were five owners from four different countries who had come forward since the crackdown began in ernest with a $39 million diverestiture order against a Piper Point buyer in March.
The six self reported cases ranged in price from $152,000 to $1.86 million.
There are 50 investigators looking into 462 cases in which foreigners were suspected of having bought or retained existing property without correct approvals. 
The Australian Taxation Office, the Foreign Investment Review Board, Department of Immigration and AUSTRAC have uncovered more than 2000 pieces of information relating to suspected breaches since monitoring of residential property acquisitions was shifted to the ATO in May from the FIRB. 
The Treasurer outlined his new, harsher penalties that will be enforced from December, against foreign investors who illegally buy established Australian properties or don't sell when the laws required.
"The period of amnesty we announced in May means that no criminal conviction is recorded for those who self-report by November 30, and they have to re-sell their property in 12 months, instead of three," Mr Hockey said.
"Australia welcomes foreign investment and Australia needs foreign investment but, at all times, foreign investors must comply with our laws," Joe Hockey said on Saturday.
"Some of the five investors have purchased property with Foreign Investment Review Board approval, but their circumstances have changed and they have failed to comply with the divestment requirements.
"Some have simply broken the rules by purchasing a property without approval and done so against the law.
"Time is running out for foreign investors to voluntarily come forward if they have illegally purchased existing residential real estate," Mr Hockey warned. 
"They have until November 30, 2015 to come to us before we come to them."
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jchancellor-FAypfDUnLy

Foreigners admit overstaying their Australian land ownership  

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Master Builders Australia enforced the importance of affordable housing for lower income earners in its submission to the House of Representatives Standing Committee on Economics Inquiry into Home Ownership in Australia.
"Social housing provides a roof-over-the-head for more than 397,000 – or about 4% of - Australian households. 
"National Affordable Housing Agreement (NAHA) is a key mechanism for providing housing assistance to those in genuine housing need, and an important instrument of social policy in Australia. 
"The better approach for NAHA (and/or its successors) must be to clear the roadblocks to improved housing affordability (especially those imposed by State, Territory and Local Governments), which will help to increase the supply and reduce the cost of housing, rather than providing government subsidies and other forms of assistance to try to offset unwarranted cost pressures on the supply and the price of housing."
Master Builders Australia is pleased that the Federal Government recognizes the issue of unaffordable housing in all capital cities in Australia. According to the submission, a few points contributed to the problem.
"Shortages of available land and inefficient land release strategies; infrastructure costs being loaded onto developers and in turn passed on to home owners; excessive infrastructure specifications in subdivisions; excessive development levies, taxes and charges imposed by State and Territory governments; excessive planning and building requirements; regulatory creep pushing codes and standards higher than required; and, un-coordinated local and state government environmental regulations. 
"Master Builders estimates the national housing supply shortfall (supply falling behind demand) has risen to more than 107,000 dwellings, which in turn contributes to housing affordability pressures."
Master Builders calls on the Federal Government to commit to, and deliver upon its National Housing Affordability Agenda key elements.  
"Tangible outcomes in improving the efficiency, and the supply-side efficiency in particular, of the Australian housing market. Annual publication by the Federal Department of Industry on its website of a rigorous and transparent stocktake of approaches to developer/infrastructure charges by all local governments in Australia.
"Streamlined and simplified development approvals processes, achieved through, inter alia, greater reliance on code-based assessment, identification of best practice development approval procedures amongst State, Territory and local governments, as well as expanded use of performance monitoring and benchmarking.
"Local governments to develop and promulgate individual realisable Land Release Plans for their own jurisdictions over a ten year rolling time horizon.
"The realisation of a genuine, rigorous, enforceable and uniform building code and regulatory system to ensure the development and continuation of an efficient and competitive building industry."
Efficient Housing Market
"An efficient housing market would have a number of features, including: a supply-side which is responsive to changes in demand-side drivers; one not burdened by distortions to market prices (the principal method by which housing demand signals are transmitted to housing suppliers); regulatory, as well as subsidy and taxation interventions, which distort and reduce the efficient operation of the housing market, are minimal, transparent and based on sound economic principles. 
"Where governments and other regulators wish to achieve social and other policy objectives in the housing sector, these outcomes be pursued through directly relevant policy instruments and in a manner which has the least possible distortion impact on the housing market."
Investor-Supplied Housing 
"Investor housing plays an important role in the supply of new residential dwellings in Australia. Investor housing likely accounted for more than 30 per cent of spending on new residential construction, on average, annually between 1985 and 2012. 
"Investors in ‘negatively geared’ dwellings likely accounted for just over 1.9 million residential dwellings, accommodating some 4.8 million people. 
"Absent the housing stock provided by housing investors, it is not clear where these people would find residential dwellings to live in – public- and social- housing almost certainly could not meet such demand." 
"As can be seen in Graph 8.1, some 40%of Australian taxpayers claiming negative net income from rental properties in the 2010/11 financial year fell into the ‘middle income’ bracket of between $37,001 and $80,000 per annum, with another 23 per cent being the lower-middle income bracket of between $6,001 to $37,000 per annum. 
"By contrast, a mere 5% of taxpayers claiming negative net income from rental properties in that financial year fell into the ‘high income’ bracket – that is, persons earning more than $180,000 per annum. 
"As such, any ill-considered action to wind-back, let alone eliminate, ‘negative gearing’ would amount to an ‘assault on the frugal middle class Australian’, rather than the ‘rich’ as some may claim. 
Taxes
"The building and construction sector is one of the most intensely taxed in Australia, and bears a direct and indirect tax burden from all levels of government — Federal, State and Territory, and Local."
More taxation attracts less investments and employment opportunities reducing housing affordability.
"Master Builders’ high level tax reform priorities call for a comprehensive review of the narrow GST base.
"Any increase in the GST rate must not be undertaken without first effecting comprehensive tax reform; reducing the company tax rate to 25 per cent; reducing the differential between the higher marginal personal income tax rates and the company tax rate; simplifying tax compliance; retaining the tax exempt status of home ownership and negative gearing; providing incentives for the removal of inefficient state taxes including infrastructure taxes, charges and levies; and, introducing a reducing, stepped rate of capital gains tax."
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Master Builders push home ownership for low income earners

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The Nobel Prize for Economics 2002 winner, Professor Vernon Smith says both Sydney and Melbourne are in a property bubble, but queries whether it will burst as badly as the US bubble.
Debt will be the key to the outcome, with Australia's flexible mortgages helping ameliorate the danger, Professor Smith said.
"It is amazing how people get carried away in the bubble," he says. "Then all of a sudden it's over and they are petrified."
He will explain more tonight in his address at the Macquarie Graduate School of Management dinner on global property prices and the Australian property market.
"You have a pretty good bubble in Sydney and Melbourne," he told Robert Harley at the Australian Financial Review on his research so far on the recent price spurt.
"It is hard to believe it is very sustainable."
He says housing bubbles are commonplace in history and most of the time they're not devastating.
He noted in the US in the recent Great Recession, similar to the Depression "it was what I like to call a balance sheet recession with property values falling against fixed long term debt.
"Total equity in all US homes peaked in 2006 at something over $US13 trillion, then hit $5.5 trillion," he noted adding in the 1930s Depression, when housing equity declined by 33 per cent, it took 13 years to recover.
"We came out of the Depression with right lessons … but the rules got eroded." 
Professor Smith acknowledged the tight supply, the rental market resilience and mortgages on only 5.3 million of Australia's 9.5 million homes.
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Noble Prize economics winner says Sydney and Melbourne in property bubble

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On Thursday, 26 June, a parliamentary inquiry into housing affordability in Australia began.
In spite of a lack of housing supply in Sydney and Melbourne to keep up with demand, rental yield return for investors is going down. There is a very simple explanation for this and yet it is something the Treasury officials struggled to account for last Thursday.
Onthehouse.com.au has data on rental yields for Sydney houses and units for over 25 years – which are plotted in Graph 1. Graph 2 plots the same data category for Melbourne. Both graphs display rental yields are falling over time.
<a href="/images/2015/07/24/G1_Rental_Yields_Sydney.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2015/07/24/G1_Rental_Yields_Sydney.jpg" alt="">
 
<a href="/images/2015/07/24/G2_Rental_Yields_Melbourne.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2015/07/24/G2_Rental_Yields_Melbourne.jpg" alt=""> 
I believe it is important to clarify why rental yields are falling, so as not to be convinced that it is somehow getting cheaper to rent in Sydney and Melbourne, because it is not.
The explanation is simple: ‘rental yields’ refer to the rental income received on a property as a percentage of what a house is worth.
As a primary school student will tell you – a fraction or percentage becomes smaller if you take the same amount of something from a larger total.
If I take a 10 cm2 area of cake from a 100 cm2 squared cake, I have taken 10% of the cake. To make myself seem less fat, I tell everyone the cake was 200cm2. Suddenly, my piece becomes just 5% of the cake, even though I have still consumed a 10cm2 area of cake. Genius. 
Rents in Sydney and Melbourne are rising. In fact, rent for the median house in Sydney rose 9.54% in the year to May, which is well above the 25 year average of 4.75%. However, the value ofhouses are rising even more rapidly. This means rental yields (measured as a portion of what the house is worth) are technically falling, but the real dollar amount that landlords are receiving in rent is generally going up. 
To get an idea of how real dollar values in rents are moving compared to house values, Graph 3 presents the increase in the index over time in values and rent in Sydney houses and units from 1990.
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An index of 5.36 in Sydney houses, for example, means houses are now 5.36 times what they were worth in 1990, which is the basis data point I’ve used. Graph 4 does the same for Melbourne.
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<img src="/images/2015/07/24/graph4.jpg" alt="">
It is clear from Graphs 3 and 4 that both dwelling values and rents are moving at a higher-than-average rate. This can be seen from the slope of the Index series.  The important thing to remember about rents is that there is a lag in response to changes in the value of living in Sydney and Melbourne. This is because rents are negotiated (usually) over 6 to 12 month periods, whereas the value of houses and units change almost daily.
According to Onthehouse.com.au, the median rent for a house in Sydney is now $670 per week. While there is not a clear, consistent up-to-date measure of the median household income in Sydney from the ABS, the indexed figure from 2011 indicates that the median Sydney household income is around $1,123. This means that renting the median home in Sydney is over 50% of the median household income. Those below median earnings will struggle further with rents in Sydney.
Thinking about rental incomes in terms of rental yields is important for investors. It is an indication of how much income you could receive to cover things like mortgage repayments and property expenses. However, it is not a term which belongs in a conversation about housing affordability. Unfortunately, the Treasury does not seem to understand what rental yields are, let alone how to use them.
Eliza Owen is the market analyst for Onthehouse.com.au. She can be contacted <a href="https://www.propertyobserver.com.au/https://au.linkedin.com/pub/eliza-owen/65/4ab/255" target="_blank">here.</a>
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Why do rental yields go down as house values go up? Onthehouse's Eliza Owen

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The Reserve Bank of Australia's submission to the House of Representatives Standing Committee on Economics Inquiry into Home Ownership has noted a decline in home ownership rates between the 25-34 and 35-44 age brackets driven in part by the sharp rise in housing prices since the mid 1990s.
The submission noted that all home ownership rates for all states were between 65 and 75% at the last Census but 'considerable variation' exists between states, with a low of roughly 65% in Queensland and highs of nearly 72% in Tasmania and Victoria. 
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RBA's home ownership submission highlights state variation

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GUEST OBSERVER
The residential building transition is firmly on track. The ABS estimate that dwelling commencements rose by 8.6% in QI. Total commencements should total a record 219K in 2015 and 202K in 2016. This is a significant lift on the 2005‑12 average of 155K. Non‑residential building construction rose by 1.3% in QI.
The trends across the States showed a significant lift in commencements in VIC and QLD. NSW commencements edged up marginally. The increase in NSW commencements has been much softer compared to the pick up in NSW building approvals. NSW commencements are likely to record stronger outcomes over the remainder of 2015.  Across the other states, commencements fell in SA, WA, TAS and ACT.
We recently discussed the large pipeline of residential work that is yet to be completed. In the current residential construction upturn, the flow through from a building approval to a commencement to final completion has been longer compared to prior cycles. One of the reasons for this change is the larger‑than‑normal share of multi‑density dwellings in the pipeline. Multi‑density dwellings are accounting for 40% of total new dwelling commencements. In prior housing upturns, mutli’s were a smaller 30% of new dwelling starts. Multi‑density dwellings tend to have long planning and pre‑approval schedules. Site preparation can be lengthy and may require demolition, excavation and remediation. A longer flow through from approval to actual construction should mean that the positive impulse and contribution to GDP growth and the economy more broadly are also more drawn out.
On our calculations, the pipeline of residential work to be done should extend well into 2016.
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Non‑residential building trends have been varied.  Commercial approvals are weak because of elevated vacancy rates.  Industrial approvals have trended a little lower. 
But, other non‑residential approvals activity has picked up noticeably – particularly in NSW and VIC thanks to large rises in short term accommodation, education and aged care building.  Demographic trends favour construction in the education and health sectors. And a lower Australian dollar is positive for the entertainment and accommodation sectors.  Non‑residential building construction should edge higher over 2015.
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Diana Mousina is an economist for Commonwealth Bank of Australia. She can be contacted <a href="https://www.commbank.com.au/blog/authors/diana-mousina" target="_blank">here.</a>
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Dwelling starts set to track at peak levels over 2015 & 2016: CBA

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Housing finance fell 4.6% m/m in May, following two consecutive months of solid growth in March and April. Finance was lower in the month across both the investor and owner-occupier segments. 
While this result may pique concerns about the dampening impact of macro prudential policy on investor sales, the data equally points to the significance of owner-occupier demand in the face of softer investor lending.
Despite continued buoyant housing market activity, housing finance posted a soft result in May with negative monthly growth posted across both the investor and owner-occupier segments. The data coincides with reports of banks tightening housing investor lending conditions in May (including removing investor interest rate discounts). While this will have had some impact on investor lending in the month, we think the full effect of these changes are likely to take some months to impact on investor housing finance as highlighted in last week’s RBA Board meeting minutes
Looking ahead, we expect actions by housing finance lenders and APRA to tighten investor lending conditions will likely maintain trend investor finance growth at around 15-25% in annual terms through the second half of 2015. This is in the range that would maintain investor credit growth within APRA’s annual growth target of 10%. Nonetheless, the appetite for housing from investors is likely to remain strong, driven by the combined impact of low interest rates, solid house price gains and the recent volatility in financial asset returns.
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New owner-occupier mortgage lending (excluding refinancing) continued to disappoint in May, with finance for both first home buyers and upgraders decreasing in the month. In fact, excluding refinance activity, the number of new owner-occupier finance commitments has been falling in trend terms since February 2014. 
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David Cannington is senior economist, ANZ Research. Daniel Gradwell is is an economist with ANZ Research. They can be contacted <a href="mailto:research@anz.com" target="_blank">here.</a>
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May owner-occupier mortgage lending disappoints: ANZ Research

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With plenty of talk about a housing bubble and home values climbing much higher in Sydney and Melbourne, housing is looking expensive to many Australians. 
Low interest rates and the strong gains in certain areas are making residential housing investment quite attractive for some which is one of the drivers resulting in increasing home values. While housing may be looking expensive to locals, the declining Australian dollar means that it may be looking more attractive to foreign buyers.
Since combined capital city home values reached their most recent low point in May 2012 they have risen by 26.8%. At the same time the Australian dollar has fallen by -13.3% over that period in trade-weighted index terms. While the depreciation in the dollar has no impact on local buyers, for off-shore buyers the fall in the Australian dollar is likely to make Australian housing even more attractive. Furthermore, the Reserve Bank continues to state that there is a need for an even lower dollar which would exacerbate the relative affordability even further.
Foreign buyers are meant to be purchasing brand new homes in most instances. There have been numerous recent reports of foreign buyers not adhering to these rules.  Furthermore a recent parliamentary inquiry found that the Foreign Investment Review Board was significantly underfunded and as a result has not been able to effectively monitor and enforce foreign investment rules.
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Combined capital city home values have increased by 26.8% between May 2012 and June 2015. Keep in mind that these figures are heavily influenced by the Sydney and Melbourne housing markets with these the only two capital cities recording value growth in excess of this figure over the period. When you look at that 26.8% increase across other currencies you can see the impact of the falling exchange rate. Of those currencies highlighted only the Japanese Yen and Indonesian Rupiah have seen values rise by a greater amount. Across most other currencies the relative value rises have been significantly lower than they have been in Australian dollar terms.
Once you look at capital cities that have seen relatively lower recent capital growth, there has been a significant improvement in Australian housing affordability for foreign buyers. Not to mention the fact that in many of these foreign countries mortgage holders are borrowing at significantly lower interest rates than those available to Australians.
Sydney
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With the RBA stating that the Australian dollar remains overvalued, any further falls in the Aussie dollar are likely to result in even more attractive buying conditions for foreign buyers. Given this it is imperative that foreign investment rules are tightened and FIRB improve their surveillance work.  A central register of foreign buyers would also be seemingly important. The Victorian Government has recently announced that it will increase fees and charges to foreign buyers of property in that state.  Despite howls of protest it would seem that this is likely to have little material impact on foreign demand for housing.  Furthermore, a national approach similar to this would be a good step towards appropriately funding FIRB to undertake their review and surveillance of foreign housing investment.  Particularly given that should the dollar fall further demand from off-shore buyers is likely to increase.
Earlier this week Federal Treasury released the Exposure Drafts and Regulatory Impact Statement of legislation designed to tighten foreign investment rules, including those relating to residential real estate. The document can be read <a href="https://treasury.gov.au/ConsultationsandReviews/Consultations/2015/Implementing-Foreign-Investment-Reforms" target="_blank">here</a> and submissions can be made up until Friday 17 July.
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Australian property, expensive for us, not so for foreigners: Cameron Kusher 

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Over the March 2015 quarter, 9.7% of Adelaide resales were at a gross loss.
CoreLogic RP Data's pain and gain report noted that was up from 9.0% at the end of 2014 but lower than the 11.3% over the same quarter last year.
Mallala had one sale over the quarter and it was at a loss, elsewhere the proportion of loss-making resales was espcially high in the Light (25.0%), Playford (21.0%) and West Torrens (16.2%) council areas.
The proportion of loss-making resales was relatively lower in the Unley (3.3%), Mount Barker (3.3%) and Adelaide Hills (4.2%) council areas.
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