Repeat buyers are one of the strongest measures of confidence in any apartment development.

At <a href="https://www.apartments.com.au/new-apartments/era-newcastle-west-124-126-bull-street-newcastle-west-nsw-2302">ERA</a> in Newcastle West, some purchasers are returning to <a href="https://www.apartments.com.au/developers/gwh">GWH</a> after living at the developer's One Apartments. Their decision to purchase again was driven by the quality of life they found after moving into their first GWH home.

Keith Wilton had spent years living in a house in East Maitland before deciding it was time for a change. Apartment living had always been on his radar, but he was selective about what he wanted.

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"I had some boxes I wanted to tick," he says.

Keith points to the open-plan design, generous outdoor areas and considered inclusions as key reasons One Apartments worked for him.

“One of those things was a nice indoor open plan area, but also I wanted a nice outdoor open area that I could entertain on in summer or Christmases or birthdays,” he says.

He also found value in the smaller details, from integrated appliances to shared resident spaces including the pool, cinema and rooftop areas.

[smartcode_project:default project_id=135096 project_image_fid=356818]

After comparing several developments, he chose One Apartments because of GWH's longstanding local reputation and his own experience working with the developer on a commercial project more than a decade earlier.

"I knew that they were local, that the quality of the build was going to be up there. I'd looked at other apartment complexes around and close by, and I just knew that here was a better decision location wise."

Today, Keith says the move has completely changed how he experiences Newcastle.

"I enjoy living in this location because it's more of a lifestyle change. That Newcastle city living where you can walk to restaurants and bars and even beaches and parks and even shopping across the road."

[smartcode_project:default project_id=135096 project_image_fid=356828]

Beyond the location, he says it's the sense of community that has surprised him most.

"Everyone loves living here because they chose to live here, but everyone looks out for each other. It's a real great community feel here."

For Aimee and Lyle Goodman, the journey started almost by chance.

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The couple happened to be having coffee in Newcastle when they noticed the site where One Apartments was about to begin construction.

"We were aware GWH was planning a development," Aimee says. "We made one phone call and things moved pretty quickly after that."

As busy business owners, they initially thought apartment living would simply reduce the maintenance that came with larger homes. Instead, it fundamentally changed how they spent time together.

"We actually catch up more as a family now," Aimee says.

"We've had homes with big yards and lots of space, but everyone ended up in different rooms. Here we'll have dinner together, the kids can play, and we spend far more quality time together."

[smartcode_project:default project_id=135096 project_image_fid=356829]

Lyle says their confidence came from GWH's reputation within Newcastle's building industry.

"I know people who've worked across different apartment projects, and whenever GWH came up the feedback was always the same. They're rock solid. They're quality."

That confidence only grew throughout the buying process.

"One of the things that really impressed us with GWH was the whole process, was the communication," Lyle says. "It was consistent, it was regular, there was no problem if we had some weird questions, there was no problems in getting answers."

[smartcode_project:default project_id=135096 project_image_fid=351104]

Aimee says one moment stood out.

"The project actually finished on time. We realised we needed to hurry up and sell our house because everything was happening exactly when they said it would."

The positive experience at One Apartments ultimately gave all three buyers the confidence to purchase again with GWH, this time at ERA.

Their confidence reflects what many buyers are seeking in today's apartment market. Location remains important, but so too does certainty around delivery, quality and long-term liveability.

[smartcode_project:default project_id=135096 project_image_fid=356822]

ERA builds on those foundations with 280 one, two and three-bedroom apartments across two landmark towers in <a href="https://www.apartments.com.au/developments/newcastle-west-nsw-2302">Newcastle West</a>.&nbsp;

Designed by <a href="https://www.apartments.com.au/architects/fk-australia">Fender Katsalidis</a>, the project will include more than 2,000 square metres of resident amenities, including a resort-style pool, gym, sauna, private cinema and rooftop entertaining spaces overlooking the harbour and coastline.&nbsp;

The development is also within walking distance of the Newcastle Interchange, Honeysuckle, Darby Street, the harbour foreshore, restaurants, retail and the city’s beaches, continuing the walkable lifestyle that existing GWH buyers say has transformed how they live.

[smartcode_project:default project_id=135096 project_image_fid=356826]

For Keith, the appeal remains straightforward.

"You feel at home even before you've moved into your home."

For Aimee, the change is measured in time.

“I just felt like I had more time,” she says.

[smartcode_project:default project_id=135096 project_image_fid=351102]

Construction at ERA is now underway, with more than half of the residences already sold and limited two and three-bedroom apartments remaining in the East Tower release. Priced from $980,000 for two-bedroom residences and $1.46 million for three-bedroom residences, buyers can secure an apartment with a 10 per cent deposit, with premium homes offering ocean views from Level 8 and harbour views from Level 10.

ERA is also backed by Resilience Insurance's 10-year Latent Defects Insurance policy, providing protection against structural or waterproofing defects for 10 years after completion. The project is anticipated to be completed in early 2028.

[smartcode_project_cta:default project_id=135096]

Joel Robinson

From ONE to ERA: Why buyers are choosing GWH again in Newcastle West

Virgate Property Group is preparing to commence construction of Verdé, its new apartment development in Melbourne's Arts Precinct at Southbank, following a strong run of sales that has seen more than half of the project's 173 apartments secured.

Verdé has attracted a broad mix of first home buyers, owner-occupiers upgrading from nearby inner-city suburbs and investors, with younger owner-occupier couples aged between 28 and 45 accounting for the strongest enquiry. Many are already living in Southbank, South Melbourne, Albert Park, Port Melbourne, South Yarra and the CBD.

"Verdé is located in one of the most desirable pockets of southern Melbourne," Blair Property Group Director Darren Blair, who is managing sales at Verdé, said.

"It's within walking distance of the Arts Centre, Royal Botanic Gardens, Albert Park Lake, and Southbank's restaurants and retail. It's a great lifestyle location with strong amenity and liveability, which made it a very attractive choice for the project."

[smartcode_project:default project_id=4661 project_image_fid=372549]

Virgate was already familiar with the precinct, having previously delivered the successful Domain House development in neighbouring South Melbourne. That experience gave the developer confidence to acquire the Coventry Street site and continue expanding its presence in Melbourne's inner south.

"We had been keeping an eye on the site and the broader precinct for a few months before deciding to move forward with the acquisition," Virgate said.

The project was ultimately secured in 2020 following feasibility studies, planning assessments and due diligence, with the brief centred on delivering "a high-quality, considered design that feels both refined and fit for purpose."

[smartcode_project:default project_id=4661 project_image_fid=314259]

Designed by <a href="https://www.apartments.com.au/architects/bruce-henderson-architects">Bruce Henderson Architects</a>, Verdé comprises 173 one, two and three-bedroom apartments priced from $599,000. The architecture is distinguished by a faceted glass façade that responds to both the site's outlook and Melbourne's changing light conditions.

According to Bruce Henderson Architects, the coloured glazing gives the building a distinctive identity while also providing privacy and solar shading, with residences oriented to capture views across the bay, city skyline and surrounding parklands.

Inside, <a href="https://www.apartments.com.au/interior-designers/designoffice">DesignOffice</a> has created interiors focused on natural light, efficient planning and enduring materials. Apartments feature engineered oak flooring, natural stone benchtops, floor-to-ceiling glazing and SMEG appliances, while a restrained material palette aims to complement the expansive outlooks rather than compete with them.

[smartcode_project:default project_id=4661 project_image_fid=372550]

Resident amenity has also been designed around everyday functionality rather than occasional use. Facilities include a concierge-serviced lobby, residents' lounge with fireplace, library and co-working space, gym, terrace garden with barbecue facilities, ground-floor café, and package delivery management.

The project's location continues to be one of its strongest drawcards. Positioned on Coventry Street, Verdé sits within walking distance of the National Gallery of Victoria, Arts Centre Melbourne, Royal Botanic Gardens and Albert Park Lake, while Southbank's dining precinct, Sturt Street trams and the new ANZAC Station are all nearby. The surrounding education catchment also includes Melbourne Grammar, Melbourne Girls Grammar, Mac.Robertson Girls' High School and several major university campuses.

The sales team says buyers have responded particularly well to the combination of location, design quality and long-term liveability.

"They're responding really positively to the quality of the design, premium resident amenities and the uninterrupted views. Many also appreciate the location and how connected it is to everything they need."

The ability to secure stamp duty savings before completion has also been a key factor for purchasers, alongside the opportunity to personalise finishes ahead of settlement.

With construction set to commence soon and more than half the apartments already sold, Verdé enters its next phase as one of the Arts Precinct's more established apartment developments, offering remaining buyers an opportunity to secure a residence before construction advances further. Expected completion is scheduled for late 2027.

[smartcode_project_cta:default project_id=4661]

Virgate's Verdé Southbank moves toward construction as sales fly past halfway stage

Downsizer-focused apartment development Kooyongkoot in Hawthorn has been recognised at the 2026 Better Future Melbourne Design Awards, taking home Gold and Silver awards in two categories.

<a href="https://www.apartments.com.au/new-apartments/kooyongkoot-hawthorn-1-kooyongkoot-road-hawthorn-vic-3122">Kooyongkoot</a>, currently being delivered by developer PQD and designed by Cera Stribley, received Gold in the Interior Design – Proposed category and Silver in the Architecture – Proposed category.

The dual recognition reflects the design approach behind the boutique development on prestigious Kooyongkoot Road, where the focus has been on creating homes for downsizers seeking the space, quality and functionality of a detached house within a low-rise apartment building.

Rather than maximising apartment numbers, <a href="https://www.apartments.com.au/developers/pqd">PQD</a> and <a href="https://www.apartments.com.au/architects/cera-stribley-architects">Cera Stribley</a> limited the development to just 18 residences, allowing for larger floorplans, greater privacy, generous landscaping and expansive communal spaces.&nbsp;The majority of the apartments also benefit from corner aspects, allowing for dual sources of natural light.

Now around 70 per cent complete and on track for completion in November 2026, Kooyongkoot will comprise a mix of garden residences, ter​race apartments, sub-penthouses, and is crowned by two half-floor penthouses with direct lift access and private rooftop terraces.

[smartcode_project:default project_id=102717 project_image_fid=355297]

The Silver Award for Architecture recognised the way the building responds to its prominent corner position at the ent​rance to Hawthorn's Scotch Hill precinct, one of Melbourne's most established residential neighbourhoods.

Rather than competing with the grand homes that line Kooyongkoot Road, the architectural approach focused on restraint and longevity, using curved brickwork, generous landscaping and carefully considered proportions to integrate with the existing streetscape.

"The form feels fluid and timeless, as though shaped by the landscape itself – architecture that belongs, rather than competes," said Chris Stribley, Co-Founder and Managing Principal of Cera Stribley.

The judging submission also highlighted practical innovations throughout the building, including lift cores servicing only nine homes each, a central landscaped lightcourt designed to bring daylight and ventilation into the building, and fully enclosed private storage rooms with lighting, power and shelving to better accommodate residents transitioning from larger family homes.

[smartcode_project:default project_id=102717 project_image_fid=355293]

The Gold Award for Interior Design recognised the project's focus on long-term liveability rather than display-home aesthetics.

According to the awards submission, the interiors were designed from the inside out, prioritising how homes would function over decades of daily use through generous proportions, practical storage, durable natural materials and flexible layouts.

The specification includes natural stone throughout, upgraded acoustic glazing, V-ZUG appliances and fully enclosed storage rooms, alongside an amenity offering focused on wellness, entertainment and everyday convenience.&nbsp;

Residents will have access to a gym and yoga studio, a wellness centre featuring traditional and infrared saunas, a cold therapy shower and treatment room, as well as a residents' lounge and golf simulator/cinema room for entertainment.&nbsp;Kooyongkoot has also considered the everyday convenience of its residents by offering a private carwash and pet wash facilities on site as well as dedicated parcel lockers and oversized fully enclosed storage rooms.&nbsp;

[smartcode_project:default project_id=102717 project_image_fid=355303]

The project's attention to detail has already resonated with buyers. Earlier this year, Kooyongkoot recorded one of Boroondara's highest apartment sales when an $8 million penthouse was purchased by a Melbourne CEO downsizing from a nearby family home.

"Every detail feels deliberate, from the overall design down to the smallest touches," the purchaser said.

"The level of quality and refinement is exceptional, but what really sold it was how liveable it felt... It felt like a place where everything had been considered, not just a luxury building."

[smartcode_project:default project_id=102717 project_image_fid=355304]

Sustainability also formed a key part of both award submissions. Kooyongkoot is targeting a minimum 7.5-star NatHERS rating across all residences, supported by passive design principles, high-performance glazing, EV charging infrastructure, water reuse systems and a wellness model focused on lower-energy dry facilities rather than pools and large wet areas.

Located within walking distance of Scotch College, Methodist Ladies' College, Koo​yong Lawn Tennis Club, Aubur​n Village and Camberwell Junction, Kooyongkoot continues to target owner-occupiers looking to remain in Melbourne's inner east without compromising on space or quality. A limited selection of two, three and four-bedroom residences remains available, with prices starting from $1.9 million.

[smartcode_project_cta:default project_id=102717]

Kooyongkoot wins Gold and Silver at Better Future Melbourne Design Awards

New apartment supply has become increasingly constrained across <a href="https://www.apartments.com.au/developments/parramatta-nsw-2150">Parramatta</a> in recent years, with fewer projects progressing through to completion as development conditions have become more challenging.

It makes <a href="https://www.apartments.com.au/developers/novm">NOVM</a>'s 2021-completed <a href="https://www.apartments.com.au/buildings/the-lennox-parramatta-12-phillip-street-parramatta-nsw-2150">The Lennox</a> one of the most recently completed residential towers on the Parramatta River, and among the newest apartment developments in Sydney's second CBD.

With the project largely completed before the sharp escalation in construction costs and inflation following the pandemic, The Lennox is now offering pricing that would be difficult to replicate in a comparable new development in Parramatta today, or across much of Western Sydney.

The majority of the 413 apartments at The Lennox sold before and shortly after completion. A limited release of the remaining apartments has recently been brought to market by capital partner <a href="https://www.apartments.com.au/project-marketer/equitifund-group">Equitifund</a>, with entry-level pricing from $700,000 and two-bedroom apartments available from under $1 million.

Rising above the Parramatta River at 12 Phillip Street, The Lennox comprises one, two, three and four-bedroom apartments, appealing to first home buyers, young professionals, families, downsizers and interstate investors seeking a completed apartment in one of Australia's fastest-growing economic centres.

[smartcode_project:default project_id=5743 project_image_fid=372394]

Rather than positioning Parramatta as an alternative to Sydney's CBD, Equitifund believes the city has reached a point where it stands on its own merits.

"Parramatta is no longer simply an alternative to Sydney CBD, it's becoming a destination in its own right," Equitifund Executive Chairman Greg Huxley said.

"The Lennox captures that evolution with a level of quality and amenity that's difficult to match at its price point."

[smartcode_project:default project_id=5743 project_image_fid=953]

Designed by <a href="https://www.apartments.com.au/architects/marchese-partners">Marchese Partners</a>, the tower responds directly to its riverfront setting through expansive glazing and open-plan layouts that maximise views across the Parramatta River and city skyline. Interiors feature engineered timber flooring, stone benchtops, stainless steel appliances and floor-to-ceiling glazing, while generous balconies extend the living spaces outdoors.

Marchese Partners says the project was conceived to balance high-quality apartment living with practical, long-term functionality, pairing larger, efficient floorplans with amenities more commonly associated with five-star hotels.

That emphasis continues through the resident facilities, which include a 20-metre rooftop swimming pool, fully equipped gym and wellness spaces, full-time concierge, a residents' lounge, function room, private lifts, secure basement parking and rooftop communal areas overlooking the Parramatta River. Ground-floor boardwalk retail and dining further activate the riverfront and integrate the building into the surrounding public realm.

[smartcode_project:default project_id=5743 project_image_fid=925]

Australian housing and finance group Equitifund has secured the remaining apartments, believing there are few completed apartment opportunities in Parramatta that offer the same combination of location, amenity and pricing.

Equitifund National Sales Director Ben Hamblett says buyers are increasingly recognising that premium apartment living no longer needs to come with Sydney CBD pricing.

"The Lennox is where aspirational living becomes attainable," Hamblett said.

"Wake to river and mountain views, step into Sydney's Second CBD, and arrive home to resort-calibre amenities, all without the harbour price tag."

Hamblett says owner-occupiers are also attracted by the convenience of having Westfield Parramatta, Church Street's dining precinct, Parramatta Park, Riverside Theatres, Western Sydney University and major transport connections all within walking distance.

"At The Lennox, lifestyle is not an afterthought, it is the foundation."

[smartcode_project:default project_id=5743 project_image_fid=5374]

The Lennox places residents within walking distance of Parramatta Square, Westfield Parramatta, Church Street Eat Street, Parramatta Station, the ferry wharf, Light Rail, the future Sydney Metro West, Parramatta Park and CommBank Stadium, reinforcing Parramatta's position as one of Australia's most connected metropolitan centres outside Sydney's CBD.

Equitifund says buyers visiting the display suite consistently comment on the quality of the finishes, generous floorplans, river and skyline views, and the walkability of the location. The project has attracted a broad mix of local professionals, upsizers, downsizers, buyers relocating from Sydney's inner suburbs and interstate investors seeking long-term growth opportunities.

That demand aligns with Parramatta's continued evolution as an economic powerhouse. Equitifund Research and Market Insights specialist John Bekiaris says sustained population growth, infrastructure investment and expanding employment opportunities continue to support long-term housing demand across the city.

"Parramatta has evolved from a satellite city into one of Australia's most important economic centres. Population growth, infrastructure investment and employment are all supporting sustained long-term housing demand."

[smartcode_project_cta:default project_id=5743]

The apartment price gap drawing Sydney buyers west

A luxury beachfront apartment at Rainbow Bay has more than doubled in value since it sold off the plan six years ago, setting a new local apartment record in the process.

The three-bedroom apartment in the Flow development on Petrie Street, the first of four new projects locally by Paul Gedoun's S&amp;S Projects, has sold for $7.4 million, after originally selling for $3.27 million when the project launched in 2020.

The seventh-floor apartment, comprising 187 sqm of internal living space and a 54 sqm balcony overlooking Froggies Beach and Snapper Rocks, was purchased by a local family.

The transaction was negotiated by Pezet Matheson director Kerry Pezet and equates to more than $30,000 per sqm.

Pezet said the sale reflected the limited opportunities to buy into the boutique beachfront development.

"The sale highlights the rarity of opportunities within the boutique beachfront development, where residences seldom become available," Pezet said.

"Flow is one of the Gold Coast's most tightly held buildings. Buyers from our database move quickly when residences become available, and achieving an off-market sale at $7.4 million demonstrates the depth of demand for property of this calibre."

<img alt="Flow" data-entity-type="file" data-entity-uuid="c585b206-2130-4eee-a50c-3f27c51a7c70" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-06%20at%208.33.25%E2%80%AFPM.png?VersionId=m3pHRDV62Y3fvN.XQuQHq.52ilTWpRLf" />

Flow was the first of four luxury apartment developments delivered by Paul Gedoun's S&amp;S Projects at Rainbow Bay and was completed in 2023.

Positioned on the beachfront overlooking Snapper Rocks, the residence includes three bedrooms, three bathrooms, a powder room and views stretching north along the coastline towards Surfers Paradise.

Pezet Matheson Residential principal Mitchell Lambert said buyers continued to prioritise quality beachfront apartments in tightly held locations.

"Flow Residences offers a rare combination of elevated beachfront positioning, architectural excellence, comprehensive resident amenity and premium finishes, which is exactly what discerning purchasers are seeking," Lambert said.

"The transaction further reinforces Rainbow Bay's reputation as one of Australia's premier coastal lifestyle destinations, where limited supply and growing demand continue to support strong market performance."

Pezet Matheson originally marketed and sold out Flow off the plan, making the latest transaction a return to one of the project's original buyers.

Paul Gedoun is selling his third project, <a href="https://www.apartments.com.au/new-apartments/radia-rainbow-bay-271-boundary-street-coolangatta-qld-4225">Radia Rainbow Bay</a>, after recently completing, and selling out, <a href="https://www.apartments.com.au/buildings/esprit-217-227-boundary-street-coolangatta-qld-4225">Esprit</a>. He has plans for a <a href="https://www.apartments.com.au/news/qld/first-look-s-s-projects-proposes-88-apartment-wellness-tower-at-coolangattas-boundary-street">fourth building</a>, 88 apartments on <a href="https://www.apartments.com.au/new-apartments/209-213-boundary-street-coolangatta-qld-4225">Boundary Street</a>.

Rainbow Bay apartment doubles in price since off the plan sale during pandemic

Investment

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A new report has noted housing market conditions in the suburb of Northcote as 'excellent', with median house prices at $943,000 rising 4.2% in the last quarter. The median sale price in the local apartment market, however, declined 1.81% for the quarter to $487,500.
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The Herron Todd White June Month in Review report also noted suburb of Carnegie was noted for an 'impressive' residential housing capital growth rate of 7.19% for the financial year and the highest median sales prices for for the past three years in with a $1,277,500 March investment. 
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Overseas investors have particular interest in prestige and off the plan investments in the Melbourne suburbs of Doncaster, Balwyn and Templestowe, often bidding against other potential purchases from overseas to enter the market above cost.
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Northcote shining in Melbourne property market: Herron Todd White

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GUEST OBSERVER
Infrastructure investment at the mature operating stage provides predictable revenue and growth in revenue above the rate of inflation, providing high levels of inflation protection.  
Infrastructure is classified as either economic or social. Economic infrastructure includes assets that facilitate transportation and telecommunications or utilities that generate and distribute power, water and gas. Social infrastructure includes assets in which services such as education, health and correctional facilities are provided.   
The majority of infrastructure assets operate in regulated environments with revenue increases linked to inflation through long term concession agreements and government contracts. There are usually high barriers to entry through large upfront establishment capital costs. Established infrastructure assets have monopoly/quasi-monopoly market positions with long useful lives of 20+ years and low operating costs.  Infrastructure assets provide services where demand is consistent or functions where demand exhibits resistance to business cycles and are linked to non-discretionary spending as a result. These attributes generate stable income returns.
Access to investment in infrastructure assets with these investment characteristics may be achieved through listed securities and unlisted funds. Listed infrastructure securities are available on the ASX and consist of companies that own economic infrastructure assets. Unlisted infrastructure funds may invest in listed securities or a portfolio of infrastructure assets either directly or through unlisted funds. Investors may also gain exposure to the infrastructure asset class through superannuation funds that invest in infrastructure through unlisted funds.
Listed and unlisted infrastructure is similar as the characteristics of the underlying physical assets are the same. Over the medium to long term returns are expected to converge between the two. Over the short term differences in pricing of listed and unlisted infrastructure investments will result in different returns and volatility of returns. Liquidity profiles differ with listed infrastructure securities readily tradeable on the ASX while unlisted funds are not liquid. Listed infrastructure securities also have a more diverse portfolio of assets both in location and type which will also affect the profile of returns.  
Australian infrastructure assets have outperformed Australian shares over the long term. In chart 1 (below) is shown the growth in value of $100 invested over 20 years from March 1995 to March 2015 in listed Australian infrastructure securities and Australian shares.
<a href="/images/2015/06/30/ev.owa.jpeg" target="_blank">Click to enlarge</a>
<img src="/images/2015/06/30/ev.owa.jpeg" alt="">
 
Source: UBS Infrastructure and Utilities Accumulation Index, S&amp;P ASX 200 Accumulation Index
Chart 1 shows that listed infrastructure generated a higher cumulative return than Australian shares over a 20 year period to 31 March 2015. Listed infrastructure generated a return of 16.4% p.a. while Australian shares generated a return of 10.4% p.a. 
Infrastructure assets provide stable and predictable cash flows with inflation linked revenue. Exposure to the infrastructure asset class can be achieved through listed securities, unlisted funds or superannuation funds that may invest in infrastructure. Listed and unlisted infrastructure is similar and has return profiles that differ over the short term and converge over the long term.  
Lev Driker is an Investment Analyst for Atchison Consultants. He can be contacted <a href="https://atchison.com.au/our-team/" target="_blank">here.</a>
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Infrastructure investment key to stable returns: Lev Driker

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The Australian property markets find themselves in an unprecedented quandary with record low cash rates that have driven investment property prices in Sydney and Melbourne to record levels. The problem as I see it is that it is highly unlikely that such dizzy heights can be maintained, so that said one can assume that prices should start plateauing. 
The problem with that scenario is that given the present market conditions this is highly unlikely as property investors are only interested in Sydney and Melbourne real estate.
The owner occupier property market is much slower with stock levels at all-time lows which can be attributed to the fact that businesses are no longer paying cash bonuses preferring to reward staff with shares. What this has done is take billions of dollars from the owner occupier property markets which explains in principle why the owner occupier markets are so slow.
Nobody can really explain why property investors are only interested in Melbourne and Sydney especially when Australia is experiencing an unprecedented population explosion. This becomes even more confusing when we hear that Australia’s east coast is the destination expected to feel the full brunt of this population explosion.
This year I have been in dialogue with Richardson &amp; Wrench Projects where I have attended some information seminars to learn more about this fascinating investor market. The problem with real estate agents is that our knowledge is always contained within a particular postcode, hence a reluctance to look outside our comfort zone which is the very same mindset as property investors.
So the first question I wanted to know was where are the next best areas to invest outside Sydney and Melbourne, that are more much affordable with strong capital growth, excellent rental returns and with strong depreciation allowances. My question was answered immediately with two areas – Newcastle and Brisbane – well, that makes sense as they are both on the east coast with strong population forecasts.
With that in mind it was off to Brisbane to have a look around and see just why Brisbane is considered the next area to chase property investor returns. The first thing you notice is their road infrastructure is superior to Sydney’s with nowhere near the traffic congestion. Just like what we are now seeing with NSW where government is now on a record infrastructure spend, although in NSW we keep adding a new lane to infrastructure that was only constructed ten years ago. The government has allocated a further 120 billion dollars for infrastructure over the next three decades.
A new international airport and the big star attraction is the new Las Vegas style $4.000 billion casino – in many instances the South Bank area (which is the area I liked the most) reminded me of what’s happening at Barangaroo on Sydney Harbor. Although at a fraction of the price.
One of the most interesting points that really resonated with me was that the Richardson &amp; Wrench Projects team told me that they actually reject 90 per cent of projects that fail their strict criteria – which was evidenced in their project investment reports which are about sixty pages of research data. Investors in Sydney and Melbourne usually get a one or two page report if they are lucky which always have the usual disclaimers.
So what happens to the ninety per cent of developments that were rejected was my next question? Well, they lure those unsuspecting property investors and stitch them up which explains why property investors stick to the areas that sit well within their comfort zones – even though they know they are paying top dollar.
Australians love investing in property which explains why so much is written about bubbles, crashes and fear factor frenzies. So if you are contemplating stepping out of your comfort zone and looking for an investment area to watch closely we would recommend Brisbane – it’s a very interesting exercise especially for those who insist that you only invest in Sydney and Melbourne. I am the first to admit that this week’s visit to Brisbane has completely changed my property investment train of thought.
It’s important to note that Australia is changing (so must our perceptions) with the latest Bureau of Statistics projections now have Melbourne as Australia’s biggest growing city. Melbourne is tracking to become the country’s biggest city in 2056 and has also overtaken Western Australia to now be Australia’s fastest growing state.
MOSMAN – 2088
• Number of houses on the market this time last year – 74
• Number of houses on the market last week – 46
• Number of houses on the market this week – 43
• Number of apartments on the market this time last year – 57
• Number of apartments on the market last week – 43
• Number of apartments on the market this week – 39
CREMORNE – 2090
Number of houses on the market this time last year – 11
• Number of houses on the market last week – 6
• Number of houses on the market this week – 4
• Number of apartments on the market this time last year –11
• Number of apartments on the market last week – 8
• Number of apartments on the market this week – 12
NEUTRAL BAY – 2089
* Number of houses on the market this time last year – 3
• Number of houses on the market last week – 2
•Number of houses on the market this week – 2
• Number of apartments on the market this time last year– 42
• Number of apartments on the market last week – 30
• Number of apartments on the market this week – 39
ROBERT SIMEON is a director of <a href="https://www.rwm.com.au/" target="_blank" title="RWM" rel="nofollow">Richardson Wrench Mosman and Neutral Bay</a> and has been selling residential real estate in Sydney since 1985.  He has also been writing real estate blog <a href="https://www.rwm.com.au/news/" target="_blank" title="Virtual Realty News" rel="nofollow">Virtual Realty News</a> since 2000.
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Searching for the next investor hot spots? Robert Simeon

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GUEST OBSERVATION
A key budget measure to change the age pension asset test has passed both houses of Parliament, despite concerns about the impact on pensioners raised by the Opposition, National Seniors and Industry Super.
But many such analyses have focused only on the income from investment assets rather than taking full account of retirees’ ability dip into their assets – like superannuation – to bolster their standard of living.
Superannuation - a nest egg or a gift to the next generation
In one example of a criticism that failed to show the whole picture, a National Seniors’ campaign poster<a href="https://nationalseniors.com.au/be-heard/retirement-income/2015-pension-cuts-campaign"> </a>against the cuts said that: a single woman living off $17,875 from $550,000 in savings will lose her part-pension. Yet, someone with no savings will receive a full pension of $22,365 plus concessions.
Little is made of the fact that the woman losing her pension can use the equity in her home to access a full pension via the Pension Loan Scheme, let alone that -– unlike the full pensioner -– she can spend some of her $550,000 in savings to supplement her standard of living.
Indeed, she is better off than most. Based on 2010 <a href="https://www.melbourneinstitute.com/hilda/" target="_blank">HILDA data</a>, only about a fifth of people aged 65-plus had non-home assets of over $500,000. Renters were even less likely to have such funds.
Similarly, analysis by Industry Super and Rice Warner projected the income levels of future retirees and compared these to what would be needed for a “comfortable’ retirement, as defined by Association of Superannuation Funds of Australia.
They found that, based on income from the age pension, superannuation, and wealth outside of superannuation, almost half of those retiring in 2055 are expected to have an income below the comfortable level and that the asset test changes will exacerbate the outcomes.
Their analysis also shows that as people accumulate more super, the asset test will affect a greater proportion of retirees and start impacting on middle-income Australians. This is unsurprising and exactly what one would expect from a maturing superannuation system. But again, little is said about how retirees have the option to use their financial assets to bolster their standard of living.
The implicit assumption seems to be that financial wealth will be passed on to children rather than be used to compensate for the loss of the pension and fund retirement (or health and care expenditures, since these are largely covered by the state). And this is in addition to passing on the family home.
The under-consumption puzzle
Recent <a href="https://www.cepar.edu.au/media/154967/age_pensioner_profiles_a_longitudinal_study_of_income__assets_and_decumulation.pdf" target="_blank">research</a> by the Centre of Excellence in Population Ageing Research confirms that most households receiving the age pension indeed choose not to spend down their financial assets and leave considerable bequests. It is part of a wider literature looking at what is referred to as the “under-consumption puzzle”.
The analysis is based on a sample of administrative data that tracked the assets and incomes of full and part age pensioners in the period between 1999 and 2007.
The results show that on average, younger and wealthier households tend to spend some of their financial wealth, but the majority see the financial assets grow, particularly couples and homeowners. Housing assets are usually preserved until very old ages unless a partner dies or goes into residential care, suggesting an element of downsizing.
Interestingly, the data shows that consumption is low when compared to the Association of Superannuation Funds of Australia benchmarks for a “modest” and “comfortable” retirement, even among the wealthier households in the sample.
One explanation is that pensioners may be self-insuring for investment and expenditure shocks, but the outcome of low spending profiles is that a large proportion of pensioner households leave significant assets as bequests.
Over 10% of single-person households in the sample exhausted 90% of the initial assets over the period, but the median pensioner that passed away during the study period was able to bequeath wealth (mainly financial) equivalent to 90% of the assets recorded at first observation.
Next up: a review of retirement income
The research highlights the extent to which pensioners rely on the age pension while preserving capital for their estate. In a system where the age pension is designed to be needs-based – not rights-based – and in the absence of inheritance tax, a strong asset test seems like an appropriate tax on such a practice.
The behavioural responses will be watched closely. A complete spend-down to gain pension eligibility is unlikely to be good value for money. Some might dip into their capital to compensate for the loss of their pension but the research suggests they will simply spend less. Others may invest in the family home, excluded from the asset test.
But one seldom quoted response is how the asset taper will affect risk. Those far from eligibility may seek out safer investments like annuities because the pension will no longer insure for losses in assets. Those who are on the steeper asset taper may seek riskier investments since the pension <a href="https://www.ceda.com.au/2015/05/Shrinking-the-Age-Pension-and-retirement-income">acts as a hedge</a> and compensates for losses (at $78 per $1k loss, compared to $39 previously).
Next on the agenda is a review of retirement income – a concession that the Greens extracted from the Government when agreeing to the asset test changes. Once the review does take place, let’s not forget to think about income as well as how people deplete their capital.
 
Rafal Chomik is Senior Research Fellow, ARC Centre of Excellence in Population Ageing Research, UNSW at UNSW Australia and can be contacted <a href="https://www.propertyobserver.com.au/https://au.linkedin.com/pub/rafal-chomik/41/4b9/263" target="_blank">here</a>.
Susan Thorp is Professor of Finance at University of Sydney and can be contacted <a href="https://sydney.edu.au/business/staff/susanth" target="_blank">here</a>.
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Super, savings meant to fund retirement, not be bequeathed; academic

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An Australian developer has outbid international interests to secure a Melbourne CBD fringe site for $2.65 million.
The property, located at 129-131 Market Street South Melbourne, is a 493 square metre site with multiple street access points. It was sold three weeks prior to auction and last sold two years ago for $1,725,000 - a 54% capital growth increase in two years.
Brokers Savills Australia, working in conjunction with M.G. O'Hallaran Property, said the lot was sold subject to a lease at $68,640 per annum.
Savills' Jessee Radisich said the purchaser will use the current zoning to build a premises to suit his business 
"But they were also well aware of the prospect of a potential future residential rezoning and while that is only a future consideration, it certainly was an aspect that drove the price up and allowed us to achieve that premium,’’ Mr Radisich said.
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$2.65 million for CBD Melbourne fringe site

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Last week we addressed some of the key issues facing younger homebuyers. This week, as promised, we’ve got some practical solutions.
Home buying and these suggested solutions are not for all young people (sub 45). But sitting on your backside, doing another tertiary course, or hoping a magical answer will come from your iPhone is also not the way for every young homebuyer either.
Yes, Australian society is presiding over a system that is unfair on you as young homebuyers.
Australian Society is taking away young people’s housing supply and increasing competitive demand through negative gearing, wealthy immigration and through paying no attention to regional infrastructure. Young people need to push forward a new batch of leaders with ‘we’ ideas instead of ‘me’ ideas and demand change. You need to get out on the streets and protest until you find leaders who can even up the ledger between older and younger Australians but the revolution may take 20 years and you as a young homebuyer can’t afford to wait forever to enter the property market.
Waiting for the market to ease never works.
No easing of the market will assist you to any noticeable degree. If you wait for any future government intervention to save you, your now 6-year-old child may be 26 before you can afford to buy. Your 16-year-old may be a 36-year-old.
You have to take action yourself. Wait for the market to change and you’ll pay the price. Please don’t confuse this statement with passing on buying the wrong home and then continuing to look for the right one in a patient, logical manner.
So our suggestion is don’t focus on the unfairness of negative gearing, super funds, Asian investing, well-off Baby Boomers and private family wealth. Focus on the fact that, this weekend, there are 300 people out there trying to buy the 30 good homes in inner to middle Melbourne on offer.
Yep 270 of those people are going to be unhappy – you need to be one of the winning 30 buyers this weekend or next weekend or later in the year.
So in Inner Melbourne right now; you as a young homebuyer are in a fight, like the wildebeest of Serengeti in a drought. There is limited grass and you need to avoid the predators (dodgy buying and selling agents, dodgy financial planners, dodgy brokers and dodgy advice which may come from well-intentioned people like your friends and relatives). Other predators are negative gearers, super funders and wealthy overseas migrants – not to mention your fellow young homebuyers.
Ok, all this negative and hard stuff is there, but don’t let it overwhelm you. Acknowledge it and move on. Many wildebeest see bad things, but the strong and the smart live on.
<a href="https://marketnews.com.au/2015/06/solutions-for-young-homebuyers/number-of-melbourne-homes-597x437/" rel="attachment wp-att-51096"><img class="aligncenter size-large wp-image-51096" src="https://marketnews.com.au/wp-content/uploads/number-of-melbourne-homes-597x437-597x437.jpg" alt="number-of-melbourne-homes-597x437" width="597" height="437"></a>
Our Bidderman statistics (bidders per auction) show that on good homes there are consistently 6 to 10 bidders per well-priced suburb median Inner Melbourne home above a million dollars. It’s the same or even more below $1M.
Not every young homebuyer can be a winner – there are simply not enough good quality Inner Melbourne homes to satisfy demand. This is the mindset I think, or I hope Joe Hockey was trying to espouse. It’s up to you.
So get the right mindset – it’s up to you or you’ll be living in Whoop Whoop West. And when you try and sell in Whoop Whoop West in 10 years, to be closer to schools, the prices in Inner Melbourne could be even more unattainable.
Get the right plan and then go after the right position, right home and right price. 
Get a deposit and get multiple funding sources – banks, relatives, tenants, partner and so on.
I’m not a great saver, more a forced one and I care little about superannuation – which may or may not be a wise move now I’m hitting the twilight years!
I’ve think I’ve worked hard (bought over 1000 homes), had good jobs, lived in secure housing near the city, travelled, raised some great kids, had good family support and a good life (lot more to come I hope). I’ve lived off good income, at times overdrafts, parental help in the early days and growth allowed by negative gearing in the latter days. Our family has been lucky, but we’ve also made our own luck. The one money thought that stands out for me: good capital growth and a good job has given us a good good life and covered over a lot of my life mistakes and money sins.
Saving is good for many and recommended, but my point is there is more than one way to skin a cat (isn’t that an awful saying) and to fund a home. Such as:
*Parents (1) – They are your best chance for help with a deposit and loan guarantees. But you may have to sell them on the idea of helping you as they’ll want to protect themselves as they get older as well. Tell them if they don’t want to drive a hour to see the grandkids then you will need help buying closer (ok, not next door but maybe only 15 minutes away) – pull on the heart strings and then pull on their purse strings.
*Parents (2) – Start hassling them to buy investment homes. They can make their retirement better by buying and renting back to you. These investments build wealth and income and you help each other. It’s the Greek/Italian, Chinese and Jewish way and it works. If you are worried about family arguments, get a written legal agreement, such as a formal lease.
<ul>
<li>* for both of the above, you can’t expect (well you can, but why should they) your parents to do it all. You have to help yourself; to save, maybe get a second job and yes, you may have to move further out (just not too far and good 3P’s), to buy your first home and live in it for 5 to 10 years.</li>
</ul>
Get a good job. Joe Hockey is right–please, I don’t barrack for any political party–unless Pendles or Clokey are running for PM. If you want to be a Buddhist, vegetarian, charity-giving monk then hats off to you; but in all likelihood you won’t be living with three kids in a Hawthorn semi-detached period home. Please I know this sounds harsh–but there is validity to Joe Hockey’s comment – get a job that pays. Sales, Real Estate, Marketing, Small Business...or get a second job, or do this plus ask your parents for help and maybe negatively gear. Do what it takes, and do it sooner rather than later, if buying a good home is an important goal of yours.
 Get creative. Buy the home you can’t afford to live in now by buying and negatively gearing now. Put a tenant in and live at home with Mum and Dad. Or buy a home and live in somebody else’s home while they rent your property. Make sure agreements meet tax laws, but negative gearing on a good capital growth home is such a powerful tool. You need it to beat overseas bidding and if you can get some growth in the next ten years before you can afford to move in, you will have put hundreds of thousands of dollars into your back pocket. And it’s legal and mostly tax free (if you’re smart about it). Yes, of course there are risks, but sometimes to get into the housing market you need to take some risks, even if there is no real safety net.
Get a plan and a process that works.
Price, property and position. These are the three ‘Ps’ you need to keep in mind when planning to buy a property.
Median Price for Precinct, Home with Land, House with a liveable floor plan and all in a position that is near infrastructure.
The knowing is not rocket science – the rocket science, in 2015, comes in the getting.
Have clarity on what you want. Is a particular property really the home for you?
List the financial and emotional outcomes you want from your home under the price, property and position headings. At the end your PPP plan, as a starting point, shouldn’t be more complicated than three sentences. It’s simple but many people don’t work out what they want before buying – they don’t have a plan.
However, avoid plans from financial planners, bankers and seminars – if they involve high risk deals such as off the plans and new apartments – these do not work for young homebuyers.
Remember the FFFs too – five-year, flexible and future-proof. In 2000, a young buyer bought a Docklands apartment for $507,500. They sold it in 2014 for $576,000. At the same time another young buyer spent $493,000 on a family home in Glen Iris. They sold it in 2014 for $1.5 million. <a href="https://www.james.net.au/jba_mhbguide_20_web.pdf"> </a>
Once you have your plan, assess, value and negotiate – eg follow a proven process.
But, just as they don’t plan, many people don’t stick to a process either. And many people can’t negotiate.
Get a professional
My next piece of advice is the advice I would give you if you were having an operation, going to court or starting a business and that is to get a professional. The facts prove themselves. A good professional property advisor will help you.<a href="https://marketnews.com.au/documents/May_Results.xlsx.pdf"> </a>
People think you simply buy a house by sticking your hand up at auction. But only 25%-30% of the properties we bought in May were bought under the hammer. 70-75% weren’t. They were negotiations.
People baulk at paying a 1% fee for an advocate’s services, but while you wait and wait to buy a home, the market goes up. In the past few months some house prices have gone up 10-20% and many buyers are:
<ol>
<li>still not in a home </li>
<li>having to find 10% to 20% more</li>
</ol>
This is all because they felt they couldn’t afford good professional help – when indeed it would have paid for itself 10 or 20 times over in the last few months and perhaps 100 times over a 7 year period. Include it in your bank loan.
Buyer advocates are widely – and wisely – used in Europe and the US.  But most Australians think they can buy a home by themselves because that’s what Mum and Dad did. That was a different time and a different market. It might have worked in 1985 but, for many, it doesn’t work in 2015. You either don’t buy, or you end up buying a home nobody else wants at a price that nobody else was prepared to pay for it.
This week I met Hard Luck Harry and his wife, Hard Luck Harriet. They’ve bid 5 times on homes in the last two years and felt nothing was going right. I made one suggestion – when nothing is going right – go left. Try something different. Hire an experienced, reputable buyer advocate / buying agent.
Yes, we mainly buy properties in the $2m to $6m bracket, but most of the issues are similar for young homebuyers. Most of our clients have affordability issues. Almost everybody we work with has a limited budget, too.
Make good decisions and take action.
Good decisions. It’s all about the decisions you make. Isn’t all of life like that? If you decide not to make a plan, not to get some professional help, not to work hard and not to do your research they are your decisions – and they are bad decisions if you want to buy a good home.
This is what a James Report contains. You need to build your own excel databases to be able to do something like this.
<ol>
<li>Ask questions of your plan</li>
<li>Assess the property (due diligence)</li>
<li>Work through values, not just what the agent says</li>
<li>Get a negotiation strategy that works</li>
</ol>
<a href="https://marketnews.com.au/documents/James_Report_2015.pdf"> </a>
<a href="https://marketnews.com.au/documents/James_Report_2015.pdf" rel="attachment wp-att-51099"><img class="aligncenter size-large wp-image-51099" src="https://marketnews.com.au/wp-content/uploads/JamesReportResults-379x448-379x448.jpg" alt="JamesReportResults-379x448" width="379" height="448"></a>
Finally, I’ll leave you with home-buying wisdom from the Melbourne Homebuyers Guide:
1. Happy spouse, happy house.
2. History repeats itself unless you break the cycle by breaking your habits.
3. Good decisions and bad decisions take the same amount of time and angst – only the quality of the prep is different. Get those 3P’s (price, property type and most importantly position) spot on.
4. Time heals or hides nothing in Melbourne property, it only accentuates.
5. No definition of value maintains its rigour for all people, except value to you; and
6. In negotiation, the closer you get and the more you talk about money, the further you drift from getting what you want.
 and my new No 7. Get the right mindset – its up to you.
Mal writes weekly auction reports, advice and in-depth market analysis on <a href="https://www.jamesbuyeradvocates.com.au/" target="_blank">James' website</a>.
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High risk new apartments should be avoided by young homebuyers: Mal James

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There are property experts who fancy regional investment over capital city.
But the latest CoreLogic RP Data pain and gain report suggests there can often be a pitfall in regional investment.
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Throughout the regional markets the proportion of loss-making resales for houses and units was much higher than in the capital cities. 
Across each regional area units recorded a greater proportion of loss-making resales than houses. 
Regional Qld (15.6% vs 29.3%), Regional WA (20.0% vs 32.4%) and Regional NT (12.3% vs 21.9%) had the largest gaps between the proportion of loss-making house and unit sales. 
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Proportion of total resales at a loss/gain, houses vs. units, capital city vs regions: March 2015 quarter.
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{mijopolls 116}
 
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Where capital cities yield higher capital growth than regions as property investments

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DEXUS Property Group (DEXUS) and DEXUS Wholesale Property Fund (DWPF) today announced that they will acquire Waterfront Place and Eagle Street Pier within the prime commercial precinct of the Brisbane CBD for $635 million.
It reflects $9,664 per square metre for the complex and a capitalisation rate of 6.9%. 
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Stockland agreed to sell its 50% stake in the 40-storey Brisbane Waterfront Place office tower and Eagle Street Pier for $317.5 million to DEXUS.
Stockland will generate $296 million from the sale of the office tower, which is a 3% premium to its December 2014 book value of $287.1 million.
As part of the transaction, Stockland will also sell its 50% stake in the Eagle Street Pier retail and restaurant precinct for an additional $21.5 million.
Stockland and the Future Fund, through its manager Corval, entered into the agreement to sell the entire 100% interest in the tower and pier to DEXUS in what is a challenging leasing market.
The asset is currently 90% leased.
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Waterfront Place overlooks the Brisbane River and features 59,500 square metres of premium office space with floor plates averaging 1,800 square metres. The building has a 5 star NABERS energy rating and a 4 star NABERS water rating. 
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Stockland acquired the office tower in February 2004 and has invested $171 million, including the cost of additions, in its 50% stake.
The other 50% interest in the property was placed into a Stockland- managed retail fund and subsequently sold to the Future Fund in 2011 for $216 million.
CBRE advised it is the largest single office sale to have occurred in Queensland and one of the largest to have occurred in Australia - and certainly the largest since the GFC. 
“The acquisition by DEXUS is a significant vote of confidence in the Brisbane office market and the medium term outlook for Queensland,” said Bruce Baker, CBRE senior managing director, Queensland.
“Whilst foreign capital has featured heavily in the Australian market recently, the Waterfront Place transaction shows the big domestic players are still actively pursuing prime opportunities,” Flint Davidson, CBRE Director, institutional investments said.
 
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Brisbane Waterfront Place sold to Dexus

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LF Economics duo Lindsay David and Philip Soos have published 23 recommendations into Australian banking reform in an attempt to curb what they believe is a 'perverse culture of homeowner entitlement' and a 'religious-like culture of property ownership and speculation'.
Featured in their submission to the House of Representatives Standing Committee on Economics 2015 Inquiry into Home Ownership, <a href="/news/the-great-australian-household-debt-trap-lf-economics-lobs-first-submission-into-hor-housing-bubble-inquiry">The Great Australian Household Debt Trap: Why Housing Prices Have Increased</a>, the paper backs the use of macro-prudential tools to moderate house price inflation, suggests the implementation of a new RBA risk assessment framework and the RBA raises in the current interest rate.
The 23 recommendations are:
Recommendation #1
Prepare legislation for the implementation of a future Chicago Plan-style reform in the event of a severe banking crisis. This includes a progression to 100% reserve lending and backing for deposits, and public control of the money supply via issuance of government money (equity) when banks want to lend, unless they wish to pay an increased premium for private debt liabilities. Forcing the requirement that banks issue debt instruments to the government, rather than the private sector, is a blueprint forremoving the noxious impact of usurious fees and interest charges, and rapid inflation in themoney supply that causes asset bubbles and financial instability.
Recommendation #2
A range of macro-prudential tools should be implemented to moderate housing price inflation and subdue credit growth in a pro-cyclical financial system, particularly those affecting the loan to value (LVR), debt servicing (DSR) and debt servicing to income (DSTI) ratios.Quantitative restrictions are placed on the share of new mortgages with moderately high LVRs (60 to 79%), and significantly strengthened for mortgages with an LVR of 80 to 89%. Mortgages with an LVR of 90% and above, interest-only loans and those backed by parental guarantee are disallowed. Mortgage debt is capped at a multiple of ten times the imputed or actual annual rental income of the property being purchased to prevent a positive feedback loop forming between rising housing prices and debt.41 The ’30-10-30 Plan’ should be a future policy consideration following a severe downturn in the housing market.
Recommendation #3
To reduce systemic risk, a large rise in capital and liquidity ratios (buffers) is implemented so banks can withstand a future economic downturn, bank run, credit market freeze or large fall in the value of collateral. Research suggests the probability of a banking crisis can be reduced to a 1 in 100 year event by raising core equity (Tier 1) capital ratios to 11 per cent in isolation or raising core equity to 10% with an additional rise in liquid assets of 12.5% (the rise in liquid assets over total assets).For the Big Four banks, this represents a rise of around 3% in core equity. Liquidity and capital buffers (and general debt provisioning) must rise during the expansionary phase of the credit cycle, taming the size and duration of a debt-financed asset price boom.
Recommendation #4
APRA enforces a transparent and prudent risk-weighting methodology for determining capital ratios. APRA rescinds banks’ authority to calculate their own risk-weights with advanced internal methods (APS 113) and enforces all new bank lending under APS 112, applying more conservative criteria and risk weights for residential mortgages. Requisite modifications to APS 112 include higher risk-weights when asset prices significantly diverge from the long-term mean (25-30 year minimum), and re-calculation of potential super-sized LGD, PD and EAD during a large housing correction.
Recommendation #5
Significant capital allocations arising from conservative risk-weights imposed on financial derivatives, with prudential regulations requiring derivatives to be placed on-balance sheet in SPVs. 
Recommendation #6 
Development of a new RBA risk assessment framework including a range of macroeconomic, banking, market-priced and qualitative indicators:
<ul>
<li>Macroeconomic metrics include the stock and flow of credit to all sectors of the economy (household, non-banking financial, non-financial business, and government sectors), sectoral leverage, associated DSRs and estimations of credit quality. </li>
<li>Banking sector metrics include capital adequacy as a proportion of total asset value (not RWAs), liquidity ratios, non-performing loan rate, asset quality in high-risk sectors (e.g. residential housing), proportion of high-LVR and interest-only lending, asset concentration on bank balance sheets, and the level of specific provisions for bad debts. </li>
<li>Market-priced metrics include the divergence of asset prices from long-term averages (e.g. P/I and P/R ratios), credit spread between market/deposit and lending rates, proportion of securitised, offshore and short-term wholesale funding, degree of foreign investment, loan to deposit ratios, and the average maturity profile of debt. </li>
<li>Qualitative measures include lending standards and risk appetite, ratio of prime to non- prime/subprime lending, trends in loan control frauds, rapid bank network growth and the intensity of financial sector competition. 
</li>
</ul>
Recommendation #7
Strict limits are placed on the Big Four banks to prevent any further mergers or acquisitions due to the high concentration of Australian financial system assets under management and the already non-competitive operating environment. A maximum threshold is established for the proportion of credit aggregates directed towards any single asset class.
Recommendation #8
APRA enforces less reliance on wholesale borrowing, particularly short-term foreign debt, via existing regulatory powers. The average maturity of wholesale funding is lengthened by adopting suitable benchmarks for short and long-term wholesale borrowing, and imposing restrictions on off-shore bond issuance. A minimum level is also set for ‘stickier’ funding sources like domestic deposits.
Recommendation #9
Covered bonds are phased out, as this dual recourse funding arrangement poses significant over-collateralisation risks. The numerous funding advantages of the Big Four banks over second-tier lenders indicate they are not disadvantaged by this reform. Legislative amendments to the Banking Act 1959 subordinating depositors in the creditor hierarchy are unwound.
Recommendation #10
RMBS funding arrangements are reviewed and a maximum 10% limit set for total RMBS financing in any asset class. The AOFM explicitly rules out any future support for RMBS.
Recommendation #11 
Establishment of a Royal Commission to conduct an exhaustive investigation of the financial system and regulatory bodies. The Terms of Reference are broad and explore accusations of extensive subprime mortgage fraud, predatory lending, and regulatory agency culpability and negligence in addressing systemic risk and unconscionable financier conduct.
Recommendation #12 
External dispute resolution (EDR) organisation regulations are reformed to better assist victims of predatory lending. Arbitrary caps on mortgages are removed, allowing EDRs to write-off the entirety of loans in the worst cases of fraud. The powers of EDRs are significantly expanded to deal with recalcitrant lenders.
Recommendation #13
The Financial Claims Scheme (FCS) is broadened to include significant ex-ante funding from banks to provide depositor and general policy insurance. A financial contribution from banks discourages moral hazard and guarantees they bear a greater loss for subsequent failures.
Recommendation #14
Economists in senior and executive public roles are subject to a suitable incentive structure to ensure appropriate management of the economy and commentary. A range of key performance indicators can be adopted and benchmarked against the performance of the economy. Economists are held accountable for the quality of their work, with a number of penalties being introduced for poor performance: fines, loss of employment and even imprisonment in the worst cases of financial and economic collapse.
Recommendation #15
The development of a more transparent and empirically-validated stress-testing framework. Primary variables that predict future instability include the size of the credit-to-GDP gap (breaching 6%), DSRs greater than 20% (related to more severe recessions), a large proportion of credit aggregates directed towards real estate (42% of all Australian banking assets are housing loans), large deviations of asset prices from the long-term mean, and low equity to deposit ratios (a greater number of creditors have a claim on banking assets). APRA ceases to use ‘soft stress-testing assumptions’ for liquidity as noted in the 2012 IMF Financial Stability Report.
Recommendation #16
The APRA stress-testing framework includes the following secondary variables: large ToT shocks precipitating a significant fall in national income, persistent tepid or negative economic growth, steep rises in unemployment stressing high DSR households, and significant Australian bank exposure to the New Zealand market.A mining sector downturn would increase the likelihood of rising personal and commercial defaults, declining credit quality, and rising bank funding costs as credit ratings agencies lose confidence in credit quality. New Zealand’s housing bubble is also heavily dependent on capital inflows for funding, suggesting a simultaneous property downturn could amplifydifficulties for the Australian parent companies, despite legal ring-fencing.
Recommendation #17
The decision to implement a CLF is reviewed, alongside the conditions of access and possible taxpayer risk. At a minimum, the cost of accessing CLF liquidity should be substantially increased, as there is a spread of well over 100bps between the wholesale funding and cash rates. Banks may otherwise try to access the CLF for cheaper funding, instead of as a last resort measure. The RBA could also threaten to convert debt into equity following a large fall in the value of collateral pledged to access liquidity. Abolishing the CLF is the most prudent measure as it is a thinly-disguised, taxpayer-funded bailout mechanism. If financial institutions require capitalisation at taxpayer expense, they should be nationalised rather than bailed out.
Recommendation #18
Bail-in provisions overseen by the FSB and endorsed by APRA are repealed, despite Australia’s implementation of the new global liquidity framework (Basel III International Framework for Liquidity Risk Measurement, Standards and Monitoring). An independent panel of experts considers a range of alternative policy measures that contribute to financial stability, outside of the costly bailout/bail-in paradigm.
Recommendation #19
A ‘true cost of service provision’ regulation is implemented regarding the pricing of essential bank services. The banking and financial sector is regulated like utilities, rather than viewed as profit centres yielding infinitely rising returns for management and shareholders.
Recommendation #20
A levy is imposed on the financial sector for the government deposit guarantee, and calculated to be the approximate size of the derived market benefit. The Big Four’s heavy concentration and majority control over financial system assets means theyalready reap significant cost savings due to economies of scale.
Recommendation #21
The alleged benefits and costs of high frequency trading are reviewed. Algorithm-based trading has led to heightened volatility in many of the world’s markets and innumerable cases of market manipulation, such as front-running of orders by large institutional players with computerised infrastructure advantages.
Recommendation #22
Lender’s mortgage insurance (LMI) is disallowed. The shifting of risk to mortgage insurers is a form of private moral hazard providing banks with an incentive to lend without considering the capacity to repay. LMI does not afford lenders any real protection in a major crisis as these companies are often severely under-capitalised for the sizeable real estate risks they are insuring.
Recommendation #23
The RBA raises the interest rate. The current speculative housing price booms in Sydney and Melbourne are amplified by the cuts to the cash rate in recent times and thus should be reversed in an attempt to dampen speculation. This may provide an incentive to many highly-leveraged and negatively-geared investors to offload their properties and dissuade new entrants into the market. The knock-on effects of record low interest rates also negate the ability of retirees, dependant on their cash savings, to spend within the domestic economy. By sustaining housing price growth through lower interest rates, the RBA has reduced incomes which will inevitably push more retirees onto the pension as their bank accounts yield increasingly fewer returns.
 
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Housing affordability must-do 23 banking recommendations: Lindsay David and Philip Soos 

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Deniliquin had returned to the investor radar, local agent Ashley Hall at Big River Real Estate said.
"They come from far and wide," he said.
"Last week we have investors down from the Gold Coast, but more regularly from Sydney, Melbourne, Adeiaide and WA too," he said.
His Deniliquin agency has the most popular investor listing on realestateview.com.au at the moment.
"Yields are going up," he explained, adding the town's recent mention in a magazine list helped.
"But Deniliquin property is coming into its own," he said given the elevated employment for the rice mill, the abattoir and the police station under construction   
  
1) 428 Wood Street, DENILIQUIN, NSW, 2710
With six bedrooms spread across two brick properties on a 974 square metre block, this Deniliquin find comes with a motivated vendor and long term tenants.
The property is currently returning $200 per week for the four bedroom, two bathroom house and an additional $160 per week for the two bedroom fully renovated unit.
<a href="https://www.realestateview.com.au/Real-Estate/428-wood-street-deniliquin/Property-Details-buy-residential-8709714" target="_blank">Click here to see the property</a>
 
2) 45 Deans Road, AIRDS, NSW, 2560
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A three bedroom offering complete with a renovated bathroom, second toilet, solar panels and gas cooking make up this listing which has attracted the second most clicks from investors on realestateview.com.
It has been marketed as a "bargain in Sydney's Western Suburbs." It is now sold to an investor. Initially it was advertised at offers over $380,000 with the vendor sensing the strong interest upped it to over $420,000.   
It noted that market rents for the area hover between $350 and $360 per week, making "this the ideal investment," Wayne Browne, the listing agent at Prudential Real Estate suggests. 
Wayne Browne told Property Observer that 70% of his buyer interest came from investors on the offering. The wide net cast through the website listing, allowed the buyer to come from 40kms away at Punchbowl.
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<a href="https://www.realestateview.com.au/Real-Estate/45-deans-road-airds/Property-Details-buy-residential-8638014" target="_blank">Click here to see the property</a>
 
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