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

Negative gearing

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The majority of Australian voters do not understand Labor’s proposed changes to capital gains tax and negative gearing, according to a report released by the Housing Industry Association (HIA) this week.
The report, based on polling by JWS Research, also showed that the majority of people 74% want a proper review before any changes take place.
"HIA has always said that changes to negative gearing and capital gains tax for housing are bad policy," HIA Managing Director, Graham Wolfe said.
"This research confirms how unpopular these changes are across all political persuasions.
"Twice as many voters oppose these changes than support them.
"This report shows that many Australians have little understanding of how Labor’s changes would affect them."
According to HIA's research, only 34% of Australians are aware of the proposed changes and understand it at some level, while others have no understanding.
52% of people believe rents will rise as a consequence of the changes. 
"With 92% of all renters aspiring to buy their own home, Labor’s proposed changes will weigh heavily on their savings’ plans," Wolfe said. 
"If these changes are made, rents will rise as supply dries up due to a lack of investment in new housing. This will make renting a home less affordable.
"If rents rise, renters saving for a deposit for their own home will take a backward step.
"These changes are anti-investment.
"They fail to recognise that private rental accommodation provides homes for almost three million families and reducing the supply of private rental homes will only lead to an increase in rents.
"We can’t solve the housing affordability challenge by taxing housing. This policy seeks to do just that.“
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j.ballantyne1990-6AQqhLzZaK

Most Australians don't understand Labor's CGT and negative gearing policies: HIA report

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Josh Frydenberg has accused Labor of “lying” about figures behind their negative gearing reforms. 
It comes as the Australian ­Bureau of Statistics has denied claims it had produced data showing that only 7 per cent of property invest­ors bought new homes, a figure opposition treasury spokesman Chris Bowen has been using repeatedly to back his housing policy.
Mr Bowen’s use of ABS data has been challenged by the Grattan Institute, a ­public policy think tank, which has argued that 14 per cent of ­investors buy new properties rather than existing ones. 
Mr Bowen has repeatedly referred to ABS figures purportedly showing that negative gearing has failed to promote construction in new housing and create jobs. 
But ABS financial statistics analyst Tony Mitchell told The Australian newspaper the ABS did not collate the figures Mr Bowen had been referring to since 2016. 
“If you wanted to have those numbers you wouldn’t be able to get them from our statistics ­because we don’t collect them,” Mr Mitchell told The Australian. 
“We’ve got a little bit about construction, but it is to do with lending to businesses for construction of investment dwellings. It is not to do with lending to households for construction of ­investment dwellings.
“There is nothing about lending­ for newly constructed dwellings. That is included in other statistics, but you can’t break it out.” 
The Treasurer said Bowen had been “caught out” and had to “come clean” about Labor’s sums in his budget reply speech later today.
“Bill Shorten and Chris Bowen have been tripping over their shoe laces and the election hasn’t even begun,” the Treasurer told Sydney’s Alan Jones on 2GB radio this morning.
“The Labor Party in reality may see a big black hole in them because they have underestimated the number of negative gearers who use new homes.
“Chris Bowen needs to come clean about the data.”
“The most recent Australian Bureau of Statistics data shows that 93 per cent of new investment loans go to people purchasing ­existing housing stock,” Mr Bowen said in January. 
“This means that the vast bulk of investment does not increase supply or boost jobs. 
“All it does is increase demand and the price of the existing homes, allowing investors to use tax subsidies to outbid owner-occupiers and first-home buyers.”
Grattan Institute director Danielle Wood said the independent think tank had estimated that more investors bought new properties than Labor was claiming. 
“It is right that you can’t ­directly calculate it from the ABS data because some of the finance is going into homes that are newly constructed and you can’t see the split between­ investors and owner-occupiers for that ­category,” Ms Wood said. 
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The Property Investors Council of Australia (PICA) said the use of ‘dodgy data’ shows Labor must urgently authorise the Parliamentary Budget Office to release modelling and assumptions used in their negative gearing and capital gains tax policies.
“If Labor has nothing to hide, then this is a straight forward exercise in full disclosure so all property owners can understand their reasoning for such significant reform,” said PICA chairman, Ben Kingsley.
Mr Kingsley said Labor’s keystone policy failed to include off-the-plan and house-and- land packages in its estimation that more than 90 per cent of new investment loans are to people purchasing existing housing stock.
He said industry experts have shown this figure to be woefully inaccurate.
“Just today Australia biggest aggregator – AFG with over 2900 mortgage brokers – confirmed its mortgage application data for new investment purchases vs. existing property was 43% new and 57% existing,” he said.
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Labor's Chris Bowen accused on major negative gearing data miscalculation

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EXPERT OBSERVER
The recent release of SQM’s research is the latest in a series of economic modelling critical of Labor’s housing tax policy to increase capital gains tax and restrict negative gearing.
Previous research commissioned by Master Builders Australia has shown that the ALP’s policies would result in an up to 42,000 reduction in new home building activity.
Given the indications of weaker than expected economic growth this is the exactly the wrong time to be discouraging investment in housing. All current incentives should be kept on the table.
Instead of just saying ‘No We Can’t’, Labor needs to stop fobbing off and ignoring legitimate questions about the impact of its housing tax policy and rethink their policies
Housing market conditions are already in sharp decline – unfavourable policy changes would make things even worse. Even in the absence of NG/CGT changes, new home building starts are likely to decline from over 230,000 to about 175,000 over the next couple of years.
Labor continues to argue that ‘grandfathering’ will neutralise any negative impact of their policies and protect against future shocks to the housing market but the evidence we do have from the Hawke-Keating era and Cadence Economics modelling is that there will be negative impacts on the housing market regardless.
For example, the investment potential of grandfathered assets will be undervalued because all subsequent owners will have a 50% tax increase on their investment.
Treasury analysis (FOI 1876) that Labor quotes in support of its policies suggests that Labor’s policies to increase capital gain tax could compound upon a cyclical downturn in the housing market that may be underway.
All this amounts to a compelling need for Labor to consider the impact of its policies to increase capital tax and restrict negative gearing before the next federal election.
Master Builders also restates that Labor conceived this policy in booming housing market – this is no longer the case. House prices have fallen by at least 15% in Sydney, Melbourne and Perth while new dwelling approvals and lending volumes are driving lower at some pace.
DENITA WAWN is the Chief Executive of Master Builders Australia
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Labor should listen to fears about its housing tax changes: Master Builders Australia's Denita Wawn

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Bill Shorten, in his budget reply speech last night, reaffirmed Labor’s commitment to restrict negative gearing to investors who purchased new housing if elected.
He claimed the current system gives investors "loaded dice" putting younger generations at a disadvantage.
It's a “bias” in the tax system that is shutting young people out of the housing market, Mr Shorten said.
“Getting together a 20 per cent deposit plus stamp duty is so much, much harder than it was 20 or 25 years ago,” the opposition leader said.
“It is even more difficult when your government uses your taxpayer money to subsidise the property investors bidding against you.”
Mr Shorten said his negative gearing rule changes were part of Labor’s plan to “stop intergenerational unfairness in our tax system”.
“A government must be brave enough and decent enough to stop the bias against first home buyers and young Australians and we will be that government,” Mr Shorten said.
He added “lectures about cutting back on smashed avo” were patronising to young people.
“You cannot have property investors playing with loaded dice against our young people, Generation Y and the Millennials,” Mr Shorten said.
However, according to recent HIA research, only 34 percent of Australians are aware of the proposed changes and understand it at some level, while others have no understanding.
While 52 percent of people believe rents will rise as a consequence of the changes. 
HIA Managing Director, Graham Wolfe said, "with 92 percent of all renters aspiring to buy their own home, Labor’s proposed changes will weigh heavily on their savings’ plans.“
"If these changes are made, rents will rise as supply dries up due to a lack of investment in new housing. This will make renting a home less affordable."
“If rents rise, renters saving for a deposit for their own home will take a backward step."
“We can’t solve the housing affordability challenge by taxing housing. This policy seeks to do just that,“ he concluded.
But Bill Shorten's 2019-20 Federal Budget reply headlines the overarching support of future housing in the previously announced National Housing Supply Council, national Housing Ministerial and National Housing Strategy, Nicholas Proud, CEO of PowerHousing Australia said.
It represents 32 of Australia’s largest Tier One and scale-growth Community Housing Providers.
Mr Proud said, “The Federal Opposition has shown a real commitment here to seeing the jobs, economic multipliers and adequate supply of housing become a national priority if they come to Government at the next election. 
"A commitment to delivering a massive 250,000 affordable rentals over a 10-year period with 20,000 to be built in the first three years with Community Housing Providers proponents of the task is a challenge CHPs are ready to take on.
“This 10-year subsidy combined with other elements such as build-to-rent, a Housing Minister, National Housing Strategy and reinstatement of a National Housing Supply Council, as promised, will tackle a housing downturn to preserve jobs, support state economies and deliver more dwellings.
“A focus on delivering expediting new NDIS investment is welcomed to capitalise on the recent momentum gained by the Agency if this shadow budget is eventually delivered.
“Whilst there is much to praise, there are tens of thousands of families in non-CHP properties who, over the next five years, are set to see the loss of the NRAS One incentives which started to lapse in December 2018.
"A response to support these non-CHP managed NRAS homes is critical and our CHP members will look to take up this challenge to seek a pragmatic solution here," Mr Proud concluded. 
Mr Shorten’s budget reply speech also mentioned plans to support build-to-rent schemes.
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Bill Shorten reaffirms Labor stance on negative gearing

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Investors will have just over six months to secure established property acquisitions to negatively gear if Labor wins the anticipated May election, it will be confirmed today.
Shadow treasurer Chris Bowen will use a speech to the Financial Services Council to announce January 1, 2020 as the start date for the policy, The Australian Financial Review indicated. 
The date also applies to the grandfathered capital gains tax policy.
The policy will need to pass through the Senate to take effect should Labor win government.
The timing announcement is likely to take any urgent imperative out of investors seeking to secure a negatively geared acquisition before the upcoming Federal election.
The six months following could see a spike in investor interest in securing established properties to negatively gear.
However this week The Urban Development Institute of Australia warned that the policy after implementation would see investors likely rely only on owner-occupiers to buy any listed investment properties which could be a "tough landscape" for investors.
The Real Estate Institute of Australia (REIA) has reiterated its strong opposition to the Labor Party’s negative gearing and capital gains tax policy following the announcment that the 1 January 2020 would be the start date for their negative gearing and capital gains tax increases if they were to win the Federal election. 
“The REIA has always been concerned with the impact the policy would have on housing markets, buyers, renters and economic activity,” REIA President Adrian Kelly said.  “This concern is magnified in the current market. 
“There is almost truck loads of analysis and reports showing the adverse impacts of the policy on mum and dad investors, home owners, renters, the construction industry, state governments and the economy.
“The latest was last week when SQM Research showed that:  house prices would drop between 5% to 12% on a weighted average for the capital cities for 2020 to 2022 over and above any other falls being experienced; rents are expected to increase by between 8% and 15% on a weighted average for the capital cities for 2020 to 2022; housing construction activity will fall by 25% to 30% from 2019 levels, which; will have employment and GDP impacts; property sales turnover is forecast to fall by a further 12% to 15%, resulting in; a drop in state stamp duty revenue of approximately $2.3 billion.
“For first home buyers, who according to Labor, should see improved housing affordability by a “levelling of the playing field” will now face a faltering economy, lower employment prospects, the possibility of higher interest rates under a Labor Government* and higher rents whilst they save for a deposit,” Mr Kelly said.  
 
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Labor sets January 1, 2020 start date for its CGT and negative gearing policy implementation 

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The Opposition leader Bill Shorten has conceded that Labor's negative gearing/capital gains tax reforms were not “universally loved.”
“I would rather see more young couples buy their first home, than spend billions subsidising investors acquiring multiple properties,” Shorten argues.
“All of the experts know that with scarce taxpayer dollars it’s better to put money into health and aged care than give a tax subsidy to someone buying their sixth or seventh investment property,” Mr Shorten said.
The last time I looked there were only 20,023 Australians with an interest in six or more investment properties, as according to ATO statistics 71 per cent of the Australians with rental properties have just the one investment.
The latest SQM forecast research suggest the policy was "risky" to the Australian economy.
There are some commentators who suggest the best time to shut down negative gearing as we know it is when few people are taking it up.
And they suggest that time is now, given our enduring low interest rates.
But the detailed SQM study ought dictate a policy rethink.
Labor announced it would abolish negative gearing as we know it before the last election, along with putting up the capital gains tax on housing investment by 50 per cent.
The policy was pitched to help housing affordability.
Sydney house have since fallen by some 13 percent from the peak, the biggest, quickest drop in living memory.
The landscape is very different now, yet the policy stays the same.
Wise heads don’t want a return to the runaway house price growth that denied first-home buyers getting into the market.
But there is a need to protect against seriously further undermining the value of people’s exisiting homes.
If Australians lose confidence in the value of the biggest investment they ever make, then this will impact everything.
No one really knows the full behavioural outcomes of investors, but polling shows Australians are unconvinced by the flagship Labor reform.
Property is a critically important asset class as Australian households hold more than half of their wealth in residential property.
Ofcourse the current anxiety assumes a change of Federal government and then the passage of the policy through the parliament.
This article was first published in the Saturday Daily Telegraph.
 
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Is now the best time to shut down negative gearing?

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EXPERT OBSERVATION
Changes to existing capital gains tax and negative gearing arrangements on residential investment properties proposed by the Federal Opposition will dampen first home buyer capacity to save for their first home.
Rental costs will increase.
While their grandfathering provisions are intended to encourage investors to retain their existing investment properties, decisions about new investments in residential housing will be strongly influenced by the higher taxation grab on investment returns and uncertainty about subsequent sales of new properties and future tax changes.
Research conducted for HIA analyses this impact and shows that rental costs will increase and the supply of rental properties will decrease.
Rental supply is crucial.
The September quarter of 2018 marked the first time since December 2006 that rents in Sydney declined in real terms.  The recent additional supply of rental properties has underpinned the improvement in rental affordability.
Changing the tax treatment on residential investment properties risks undoing the good work, lifting rental prices and dampening the home ownership aspirations of renting households.
For many households, living in a rental property is an interim step towards home ownership. It’s a period of independent living while they save a deposit to purchase their own home.
Any increase in their rental costs will impact their capacity to save a deposit, extend the savings’ period and dampen their home ownership aspirations. 
We already know that more than 90 per cent of renters aspire to own their own home.  Unfortunately, less than half believe they will achieve this dream. 
Australia needs to reverse this trend, renew our national commitment to home ownership and adopt measures that support first home aspirants. That includes support while saving for a deposit,” concluded Mr Wolfe.
GRAHAM WOLFE (pictured) is the Managing Director of HIA
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Australia’s home ownership aspirations at risk: HIA's Graham Wolfe

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SQM Research believes there is a "very high risk" based on Labor’s proposed negative gearing policy, that investors purchasing new property may experience losses on a resale in the first three years of the property’s life.
"Investors seeking to benefit from the new concession by buying new properties are exposed to a substantial risk of their property being valued below purchase price, especially if the buyer is seeking to sell their investment within the first three years," SQM director Louis Christopher said.
While the SQM director Louis Christopher says there is no solid data to prove this point, it was in SQM'S experience that over the course of a cycle:
<ul>
<li>Off-the-plan developments will be sold between a 15-30% premium to the existing market.</li>
<li>30% of off-the-plan developments will sell at a loss to the initial purchase price if sold within the first three years if the dwelling’s life.</li>
</ul>
A premium paid over and above the existing market is often justified as one is effectively buying ‘new’ and the best quality fixtures and fittings compared to the existing market. 
Christopher predicts dwelling prices to fall.
<img src="https://www.urban.com.au/images/2019/3/22/JPEG%20-%202020%202022%20Dwelling%20Price%20Forecasts.JPG" alt="">
"Given the forecast of initial negligible rental growth, SQM Research forecasts an additional correction in the housing market of between 4% to 8% over a three year period (2020 to 2022) with most of the falls occurring in years one and two."
This assumes an interest rate cut of 50 basis points by early January 2020.
He sees yields as rising.
<img src="https://www.urban.com.au/images/2019/3/22/JPEG%20-%20Yields%20to%20Rise%20International%20Comparisons%20table.JPG" alt="">
International comparisons as well as historical precedents indicate that acquisition rental yields are likely to rise between 0.85% and 1.2% (85-120 basis points) over a two to three year period post the implementation of the new policy.
"If interest rates are cut by 50 basis points, the rise in yields will be smaller at between 60 and 95 basis points."
He tips rents to rise 7-12% over 2020 to 2022.
<img src="https://www.urban.com.au/images/2019/3/22/JPEG%20-%202020%202022%20Dwelling%20Rent%20Forecasts.JPG" alt="">
<img src="https://www.urban.com.au/images/2019/3/22/JPEG%20-%20Change%20in%20National%20CPI%20and%20Rent%20Index.JPG" alt="">
"Rental changes are initially likely to be negligible due in part to a current oversupply in Sydney and some other cities.
"However, there may be an acceleration from year 2021 due to an expected sharp fall in dwelling completions.
"Brisbane and Perth are forecasted to record the largest rises."
The report envisages housing construction and completions will fall further.
<img src="https://www.urban.com.au/images/2019/3/22/JPEG%20-%20Aust%20Dwelling%20Commencements.JPG" alt="">
SQM Research forecasts the total fall in housing construction activity will amount to a 25% to 30% decline from 2019 levels.
"Given the existing falls in construction and the anticipated peak in infrastructure spend in 2021 this could have a large impact on GDP and employment in the economy," Christopher said.
"The total adjustment in the market housing market is forecasted to last for approximately three years, with most of the adjustment phase occurring within two years.
"Thereafter the market would likely return to equilibrium, having ‘priced-in’ the loss of the tax concessions."
He forsees sales turnover to fall by another 12% to 15% with most of the declines in sales to occur in the first year (FY2021).
This would result in a fall in state stamp duty revenue of approximately $2.3 billion.
The report represents an update on his 2016 research to cover the potential price, rent and turnover impact of the Labor Party’s negative gearing policy initially released February 2016.
Labor will limit negative gearing to new housing from a yet-to-be-determined date after the next election.
All investments made before this date will not be affected by this change and will be grandfathered which means that taxpayers will continue to be able to deduct net rental losses against their wage income, providing the losses come from newly constructed housing.
From a yet-to-be-determined date after the next election losses from new investments in shares and existing properties can still be used to offset investment income tax liabilities. These losses can also continue to be carried forward to offset the final capital gain on the investment.
The report presents several scenarios.
<ul>
<li>Scenario 1 - Negative Gearing cut 1 July 2020 and interest rates cut by 50 basis point</li>
</ul>
In the first scenario, The Reserve Bank of Australia cuts interest rates starting from late 2019 by half a percent (50bp). Negative Gearing is changed and CGT increases are passed and enacted on 1 July 2020.
SQM take the view there would be an overall gross yield increase of some 65 basis points after taking into account the rate cut; 25 basis points of which is passed on. Prices would still considerably fall in Sydney and Melbourne but other cities would be less affected.
There is a likelihood the housing market could rally post the interest rate cuts and leading into 1 July 2020 as investors take advantage of grandfathering. The earlier the rate cuts, the greater the likelihood of a rally. Most of the price falls would happen over later 2020 and 2021 with a potential market bottom in 2022.
Rents in Sydney and Melbourne do not lift initially on the back of some existing oversupply of rental stock. But that stock is quickly absorbed in 2021/2022 leading to an acceleration in rents.
<ul>
<li>Scenario 2 – No Interest Rate cut</li>
</ul>
In this scenario, the market takes the full brunt of the Negative Gearing change and CGT lift. Prices fall sharply with a minimal pick up in demand prior to passing of the bill (assumed 1 July 2020).
Average capital city gross rental yields lift by 85 to 120 basis points with the yield increase being shared between price falls and rent increases.
With prices falling sharply over 2020/21, housing commencements fall greater than scenario one therefore creating a larger shortage of housing relative to underlying demand in 2021/2022.
<ul>
<li>Scenario 2 assumes no recession but there would have to be serious questions on the state of the economy.</li>
<li>Scenario 3 – No Negative Gearing change and 50 basis point rate cut</li>
</ul>
This scenario assumes either the Labor Party defers the tax changes or the Liberal Government wins the 2019 Federal Election. This assumes therefore, a likely recovery in the housing market as confidence returns due to a rate cut, no Negative Gearing change and no Capital Gains Tax increases. Bank lending is less restrictive.
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Rents to rise under Labor, negative gearing/CGT policy risky to economy: SQM's Louis Christopher

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Proposals to limit negative gearing and reduce capital gains tax concessions will cost a Labor Government $32 billion over just 10 years, according to modelling by the Property Investment Professionals of Australia (PIPA).
Their research found that limiting negative gearing to brand new investment properties as well as reducing the capital gains tax discount will "drive investors out of the market in droves and leave a gaping hole in government coffers."
PIPA chairman Peter Koulizos said the research showed that Labor’s assertion that their policy would save $32 billion over a decade was a flight of fancy when it was actually set to lose that amount because of drastically fewer investors in the market.
“Not only that, investors already pay almost four times in capital gains tax what they receive in negative gearing benefits over a 10-year period, so the government is already ahead financially,” he said.
The PIPA modelling found that an investor who bought a $675,000 property today would receive about $23,583 in negative gearing benefits over a decade, but they would pay $104,703 in capital gains tax if they sold the asset – leaving the Federal Government with a $81,118 net gain.
The modelling found that a Labor Government could lose between $10 billion and $32 billion over 10 years, plus fewer investment properties would drive rents higher and further hinder first home buyers from entering the market.
The modelling found:
<ul>
<li>If investment activity reduced by 15 per cent there would be 390,000 fewer properties available for rent with the total loss of capital gains tax revenue to government being $31.6 billion over 10 years. </li>
<li>If investment activity reduced by 10 per cent there would be 260,000 fewer properties available for rent with the total loss of capital gains tax revenue to government being $21 billion over 10 years.</li>
<li>If investment activity reduced by five per cent there would be 130,000 fewer properties available for rent with the total loss of capital gains tax revenue to government being $10.5 billion over 10 years.</li>
</ul>
Mr Koulizos said the modelling was not even worst-case scenario, given 45 per cent of investors indicated in the 2018 PIPA Investor Sentiment Survey that they would put their future investment plans on hold if Labor brought in the proposed changes.
“I have no doubt that limiting negative gearing and reducing capital gains tax concessions by the Federal Labor Party will discourage property investors from buying property,” Mr Koulizos said.
“Labor says they want to incentivize investors to buy new property, but our research shows that 93 per cent of investors buy established property as this has greater capital growth potential than new property."
He added, “under the proposed changes, investors will pay more capital gains tax, but since they have probably bought a new property that will mean lower capital growth and therefore reduced tax payable to the government.”
Mr Koulizos said Labor’s assumption that fewer investors would mean more first home buyers was incorrect with the ability to save a deposit being the main issue for first-timers.
“Saving a deposit for your first property has always been difficult and has been made even more so over recent years with the First Home Owners Grant restricted to new dwellings when more than 80 per cent first-timers buy an existing property,” he said.
Mr Koulizos said the reduction in revenue is likely to be even greater after the 10-year period as there would be fewer investors paying tax on their positively geared properties as well as paying capital gains tax on the strong equity growth that usually occurs after holding an established property for 10 to 20 years.
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Labor Government would be $32 billion worse off by limiting negative gearing: PIPA

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Property is a critically important asset class as Australian households hold more than half of their wealth in residential property.
Policies that have the potential to affect housing values have a direct bearing on household confidence and then the appetite for consumption versus savings.
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When the ALP negative gearing policy was first unveiled several years ago, Sydney’s residential property market was in a boom.
The landscape is very different now, yet the policy stays the same.
It was pitched as a policy to make home ownership more affordable, which the recent price falls have certainly achieved.
Labor wants to halve the capital gains tax discount and restrict negative gearing to newly built homes, while “grandfathering” existing arrangements.
It calculates the policy would save (and or raise) $32 billion over 10 years.
The proposed changes have contributed a little to the nervousness surrounding the property market, and therefore contributed to the decline in prices.
Ofcourse the anxiety assumes a change of Federal government and then the passage of the policy through the parliament.
There's plenty of feared impacts should the policy to become law.
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While the proposed changes to negative gearing and also to capital gains tax will only apply to investments purchased after any policy change, there are going to be huge impacts on investment behaviour.
There are some impacts quietly at work now, while other impacts are coming down the track.
Some investors will now be buying established housing as the purchase will be able to be negatively geared and also avoid the higher capital gains tax on any resale.
After the policy comes in, there would be a period of inactivity as investors appraise the new landscape and initially avoid new housing purchases. Historically investors have a marked preference for established housing as it is cheaper.
Investors would also refrain from selling investments at the higher capital gains tax in the hope that there would be a return to a Coalition government who'd possibly scrap the policy.
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Not withstanding the CGT impact, the biggest concern is the policy would likely reduce the overall supply of property in the rental market, and trigger a rise in rents.
Rental accomodation is essential for one-third of Australian households.
No one really knows the full behavioural outcomes of investors, but Australians are unconvinced by the flagship Labor reform with 44 percent against the policy change.
Voters are also against the mooted change on capital gains tax on investments, with 48 per cent against.
The Opposition leader Bill Shorten has noted that the tax reforms were not “universally loved.” That would because some 2.1 million Australians have a rental property.
“I would rather see more young couples buy their first home, than spend billions subsidising investors acquiring multiple properties,” Shorten argues.
“All of the experts know that with scarce taxpayer dollars it’s better to put money into health and aged care than give a tax subsidy to someone buying their sixth or seventh investment property,” Mr Shorten said.
The last time I looked there were only 20,023 Australians with an interest in six or more investment properties. 
According to ATO statistics some 71 per cent of Australians with rental properties had just the one investment.
There's going to a lot of upheaval to get stuck into the 20,023.
Maybe the solution should be, without retrospectivity, simply limit claims to just one negatively geared policy.
This article first appeared in The Daily Telegraph.
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