<a href="https://www.apartments.com.au/developers/s-p-setia">SP Setia</a> has lodged plans for a $750 million, three-tower mixed-use precinct that would complete the long-running redevelopment of Carlton's former Carlton United Breweries site.

The proposal at <a href="https://www.apartments.com.au/new-apartments/185-195-queensberry-street-carlton-vic-3053">46-78 Bouverie Street and 185-195 Queensberry Street</a> spans a 6,468 sqm site, the last remaining undeveloped parcels within the former brewery's 2007 masterplan.

Designed by <a href="https://www.apartments.com.au/architects/cox-architecture">COX Architecture</a>, the development will comprise two purpose-built student accommodation towers and a third build-to-sell apartment tower above a shared commercial podium and basement.

Across the three towers, SP Setia is proposing 606 build-to-sell apartments and 1,499 student accommodation units containing 2,009 beds.

The apartments will sit in the tallest tower, which will rise nearly 200m and 55 storeys. It will become&nbsp;one of the more substantial new build-to-sell apartment projects at the northern edge of Melbourne's CBD.

The apartment mix is weighted toward smaller inner-city product, with 188 studios, 206 one-bedroom apartments, 192 two-bedroom apartments and 20 three-bedroom apartments

<img alt="First look: SP Setia plans three-tower finale for Carlton’s former CUB precinct" data-entity-type="file" data-entity-uuid="8271bc87-1b0a-41b7-ac73-a425ee375261" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/3_2.png?VersionId=G4lw23o90B1boX4k4dj7rdz2ZEajS9wy" />

Part of the precinct will be a large-scale&nbsp;3,684 sqm supermarket and a further 2,198 sqm of speciality retail, creating close to 5,900 sqm of new commercial space within the precinct.

But one of the biggest components of the proposal is what sits between the buildings.

Around 4,650 sqm, or roughly 72 per cent of the site, will be publicly accessible open space, incorporating plazas, pedestrian connections, landscaped laneways and retail spill-out areas.

The ground plane is intended to finally complete pedestrian connections envisaged when the CUB masterplan was first approved nearly two decades ago, stitching together Victoria Street, Queensberry Street, Bouverie Street and Swanston Street through the former brewery precinct.

Urbis said the development would "complete the CUB precinct", with the public realm providing important north-south and east-west connections through what is currently the final undeveloped portion of the masterplanned site.

SP Setia is also exploring a new linear park within the Bouverie Street road reserve, with the concept to be developed further with the City of Melbourne through the planning process.

The proposal is being pursued through the Victorian Government's Development Facilitation Program under Clause 53.23 for significant residential development with affordable housing.

The planning report acknowledges the proposed heights exceed those contemplated under the original Comprehensive Development Plan and masterplan, but argues the built-form context has changed considerably over the past two decades.

Urbis said the three towers would instead create a stepped transition between Carlton and the Hoddle Grid, rising progressively from the 94.1-metre Tower One along the Queensberry Street edge to the 199.44-metre Tower Three closer to the established CBD-scale buildings to the south.

<img alt="SP Setia" data-entity-type="file" data-entity-uuid="e885a07a-592c-40fc-bf82-e6dbaf32da54" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-21%20at%208.52.24%E2%80%AFAM.png?VersionId=7s_ErUkSKAdY1mAWp3GRZgMNCGtwhk5m" />

SP Setia plans to deliver the development across three stages.

Stage One would deliver the basement, podium and retail areas for the entire precinct alongside the first student tower. Tower Two would follow in Stage Two, before the 606-apartment Tower Three is delivered as the final stage.

If approved and delivered, the project would close out a redevelopment process that has been underway since the former brewery masterplan was approved in 2007, adding more than 2,600 student beds and apartments to a precinct already home to Swanston Central, the Barak Building, RMIT Design Hub and several large student accommodation developments.

&nbsp;

&nbsp;

Joel Robinson

SP Setia plans three-tower finale for Carlton’s former CUB precinct

Melbourne developer Lowe Living is seeking to add to its growing bayside apartment pipeline, filing plans for a boutique eight-residence development in tightly held Middle Park.

Lowe Living, which has built much of its development portfolio across Melbourne's affluent bayside and south-east suburbs, is behind the plans for the 730 sqm site at <a href="https://www.apartments.com.au/new-apartments/123-125-erskine-street-middle-park-vic-3206">123-125 Erskine Street</a>, just off Armstrong Street and within the Armstrong Street Neighbourhood Activity Centre.

The developer is seeking approval for a five-storey residential building above two basement levels, with just eight large-format apartments and 18 car spaces.

“This is a deliberately very different proposition for us,"&nbsp;Tim Lowe, Co-Founder of Lowe Living, said.

"Eight residences is exceptionally boutique, but that's precisely what this site calls for.

“There is a strong community in Middle Park and the surrounding suburbs who have spent decades building a life here. They no longer want the maintenance of a large period home, but they aren't prepared to compromise on space, quality or location. We think there is a real opportunity to capture that hyper local market. A site like this rarely comes to market.”

<img alt="Lowe " data-entity-type="file" data-entity-uuid="875fe572-0f14-4d90-9e11-55b28dd07731" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-21%20at%208.42.49%E2%80%AFAM.png?VersionId=GDNQRv9BfpR9r1zkZ5UDyUM4ZvpIksut" />

The low-density proposal has been designed by Cera Stribley and is being progressed through the Victorian Government's Great Design Fast Track pathway, having already secured eligibility from the Minister for Planning.

The Office of the Victorian Government Architect supported its eligibility after finding the proposal demonstrated consistency with the program's seven design principles, while the project's financial feasibility has also been independently confirmed by Invest Victoria.

The project is targeting the downsizer market, with the planning documents describing the homes as larger-format residences and noting the two penthouses could otherwise have been configured as four separate apartments.

<img alt="Lowe 2" data-entity-type="file" data-entity-uuid="60ab0987-2da6-4175-adac-315dcf6053c6" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-21%20at%208.43.15%E2%80%AFAM.png?VersionId=bOCPH0B2MFwlmaRW.TTCF9TzyifgVoQI" />

The site has dual frontage to Erskine Street and Canterbury Place and currently comprises a collection of commercial buildings used as offices, including a former heritage bakehouse, a former stable, a later gabled addition and a central courtyard.

It sits within the Commercial 1 Zone and the Armstrong Street Commercial Precinct heritage overlay, with the existing property classified as a contributory heritage place.

Heritage has subsequently played a significant role in Cera Stribley's design.

The front section of the former bakehouse facing Erskine Street will be retained, including its return walls, street-facing hipped roof and chimneys, while the Erskine Street façade and part of the western return wall of the former stable will also be incorporated into the new development.

Levels four and five will be set back five metres from the retained stable façade, while bricks removed through demolition are proposed to be salvaged and reused within the new building where possible.

<img alt="Lowe 3" data-entity-type="file" data-entity-uuid="e97927a9-a2de-4a0f-83b6-65451238abfa" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-21%20at%208.43.06%E2%80%AFAM.png?VersionId=VR44AChLrX9q1XPB9GvVQV.ALXXbe4gC" />

Rather than presenting as a single five-storey building to Erskine Street, Cera Stribley has broken the development into a series of distinct forms.

A three-storey infill element will sit between the retained bakehouse and stable façades, with the upper levels recessed behind the heritage fabric. Canterbury Place will similarly feature two three-storey podium forms, separated by a central pedestrian accessway, before the upper two levels step back from the street.

A pedestrian through-link will run through the centre of the project between Erskine Street and Canterbury Place, creating entrances from both sides of the site and introducing landscaping and communal areas through the ground plane.

Landscape architect Acre has designed planting across the ground level, private terraces and upper levels, including a feature canopy tree at level three and integrated planting and arbours across the level four terraces. Five existing Erskine Street trees are proposed to be retained.

Sustainability is also a significant component of the Great Design Fast Track application. The apartments are targeting an average eight-star NatHERS rating, with no residence below 6.5 stars, while the project has achieved a 75 per cent BESS score. Seven of the eight apartments are designed for cross-ventilation, with the remaining residence using mechanically assisted natural ventilation.

The plans also incorporate an 8kWp rooftop solar system, a 5,000-litre rainwater tank and infrastructure allowing future electric vehicle charging for every residence.

Lowe has a strong portfolio across Melbourne's blue-chip suburbs. They recently launched <a href="https://www.apartments.com.au/new-apartments/jardin-house-by-lowe-living-camberwell-335-camberwell-road-camberwell-vic-3124">Jardin House by Lowe Living</a> in Camberwell, their first development in the Stonnington LGA.

Lowe Living unveils Middle Park apartment development

Article summary

<ul data-end="888" data-start="289">
	<li data-end="442" data-section-id="8tsh6o" data-start="289">DVB Projects is preparing to launch its second Gold Coast apartment development, with demolition now underway at 137 Old Burleigh Road, Broadbeach.</li>
	<li data-end="573" data-section-id="1nyxl3e" data-start="443">The 34-level tower will comprise just 49 ultra-luxury residences, including half-floor, full-floor and penthouse apartments.</li>
	<li data-end="717" data-section-id="oiyimj" data-start="574">The launch follows strong demand at DVB's nearby Sea Glass project, which is more than 50 per cent sold and currently under construction.</li>
	<li data-end="888" data-section-id="epk9o9" data-start="718">The development adds to the transformation of Old Burleigh Road, with premium beachfront apartment projects continuing to reshape the tightly held Broadbeach strip.</li>
</ul>

<a href="https://www.apartments.com.au/developers/dvb-projects">DVB Projects</a> is preparing to launch its second Gold Coast apartment development, with demolition now underway on the Broadbeach site as the Sydney developer moves closer to bringing the ultra-luxury project to market.

The 34-level tower at <a href="https://www.apartments.com.au/new-apartments/137-old-burleigh-road-broadbeach-qld-4218">137 Old Burleigh Road</a> will comprise just 49 residences, ranging from half-floor apartments through to full-floor homes and a penthouse. The launch follows the strong sales performance of DVB's nearby Sea Glass development. More than half of the apartments at Sea Glass, on the other side of Broadbeach, have been snapped up, well ahead of its late 2027 completion

<img alt="DVB Projects to commence demolition on $320m Broadbeach luxury tower" data-entity-type="file" data-entity-uuid="2944b4be-c84e-4b54-8dc1-c712e76704c0" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/E02_Exterior_Street%20Level%20Entrance.jpg?VersionId=YoNig7pRdrE3HCue7sUj78LzJteeQf3H" />

The start of demolition at 137 Old Burleigh Road signals DVB Projects’ underlying confidence in the Gold Coast’s luxury beachside apartment sector.

“We see the Gold Coast as one of the most compelling lifestyle markets in Australia, particularly at the premium end where demand continues to deepen,” said Dean Brown, Managing Director of DVB.&nbsp;

“This project has been carefully designed to respond to that demand - delivering large-format residences with a level of quality, privacy and amenity that is still relatively rare in the apartment market on the beachside."

Brown says the site itself is "exceptional."

"Old Burleigh Road is one of the most tightly held beachfront strips, and opportunities to deliver a project of this scale and calibre in this location are extremely limited.”

<img alt="DVB Projects to commence demolition on $320m Broadbeach luxury tower" data-entity-type="file" data-entity-uuid="398f377a-c037-455e-9250-0c5e0d84c35b" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/I12_FF%20Balcony.jpg?VersionId=NwOiRWGMubR1c8wthuEfggklcja7al9." />

The project will comprise 40 half-floor residences of approximately 260 sqm, alongside eight full-floor residences spanning around 524 sqm.

A single penthouse will crown the building, featuring a private pool, barbecue area, indoor gym and dedicated entertaining spaces.

Residents will have access to a resort-style suite of amenities, including a 20-metre pool with daybeds, a gymnasium, hot and cold plunge pools, a sauna, and private residents’ lounge and dining facilities.

<img alt="DVB Projects to commence demolition on $320m Broadbeach luxury tower" data-entity-type="file" data-entity-uuid="d1642bb0-9a66-4427-a022-dfc0988c6287" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/A02_Pool%20to%20View.jpg?VersionId=c0IXPyn_Gp_Kn3XCwzMrqIVkAdCEwVXP" />

Sales agent Todd Matheson, of <a href="https://www.apartments.com.au/project-marketer/pezet-matheson">Pezet Matheson</a>, which is marketing both 137 Old Burleigh Road and Sea Glass, said 137 Old Burleigh Road would address a clear gap in the market for genuine luxury products.

“There are very few opportunities on the Gold Coast where buyers can secure a residence of this size and quality in a new building,” Matheson said.

“What we’re seeing is a growing cohort of downsizers and interstate buyers who still want space - they’re not willing to compromise on living area, entertaining or finishes.

“This project has been designed with that buyer in mind. It offers the scale of a home, combined with the convenience and security of apartment living, in one of the coast’s most desirable positions.”

<img alt="DVB Projects to commence demolition on $320m Broadbeach luxury tower" data-entity-type="file" data-entity-uuid="59aae0ca-5639-4320-8aca-d0bf60f48e43" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/E01_Exterior%20Hero.jpg?VersionId=DS8Zfy2WtgUEtdfe0TEUuf1W1GfcZq8S" />

Located on a 1,156 sqm site one block from the beachfront, the development will replace an ageing walk-up building and is expected to contribute to the ongoing transformation of the Old Burleigh Road strip into one of the Gold Coast’s most prestigious residential corridors.

With the development moving into the delivery phase, 137 Old Burleigh Road is slated to hit the market later this year.

[smartcode_project_cta:default project_id=145141]

DVB Projects to launch second Broadbeach apartment tower as demolition commences

<a data-end="327" data-is-only-node="" data-start="250" href="https://www.apartments.com.au/developers/norus-projects" rel="noopener" target="_new">Norus Developments</a> has lodged plans for a new apartment development in Clayton that would add further momentum to the suburb's emerging Green Street corridor.

Plans have been lodged for the consolidated site at <a href="https://www.apartments.com.au/new-apartments/1359-1365-centre-road-clayton-vic-3168">1359-1365 Centre Road</a>, where Norus is seeking approval for 218 apartments across a 12-storey apartment building designed by <a href="https://www.apartments.com.au/architects/life-architecture-and-urban-design">Life Architecture</a>.

The proposal sits within the Clayton Major Activity Centre at the threshold of the planned Green Street corridor, a landscaped pedestrian connection intended to improve links through the precinct towards Clayton Railway Station.

The development would replace the site's existing collection of low-scale residential and commercial buildings with a single consolidated building, introducing significantly greater housing density to this part of Centre Road.

A retail tenancy is proposed at ground level to activate the Centre Road frontage, accompanied by transparent street interfaces and landscaping intended to create a more pedestrian-focused edge to the development.

<img alt="First look: Norus Developments plans landscape-led apartment project for Clayton’s emerging Green Street" data-entity-type="file" data-entity-uuid="0a5a763a-d9e9-4253-af2f-88008de27ebf" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Clayton%20a.png?VersionId=S2WJJbat1XVkZwB9SnYtygirXgWHiklX" />

The building has been designed with stepped massing and upper-level setbacks to manage its transition towards surrounding residential properties. The planning report describes the approach as one that integrates the building into the landscape rather than treating landscaping as a secondary element.

"A strong landscape and public realm strategy underpins the proposal," Urbis states in the planning report.

"Public benefits include an affordable housing contribution, a new pocket park, generous landscaped setbacks, deep soil planting and integrated Water Sensitive Urban Design."

The report adds that these elements are intended to create "a permeable, pedestrian-focused ground plane that enhances walkability, supports urban cooling and reinforces the emerging Green Street character."

Biophilic and passive design principles extend through the residential levels, with planting, daylight, natural ventilation and views towards landscaped areas forming part of the amenity strategy.

Parking would be concentrated away from the public realm, with 145 car spaces proposed from the rear laneway rather than dominating the Centre Road frontage.

The proposal follows an extensive pre-application process with the City of Monash. Three formal meetings were held between the project team and Council from December 2025 to March 2026, with the scheme evolving through several concept iterations before the current design was lodged.

The project arrives as Clayton prepares for substantial change around its established activity centre and the wider Suburban Rail Loop precinct. Its position on Centre Road places the development within an existing concentration of shops, services and public transport, while the Green Street connection is intended to strengthen pedestrian access towards Clayton Railway Station.

First look: Norus plans landscape-led apartment project for Clayton’s emerging Green Street

<a href="https://www.apartments.com.au/developers/gardner-vaughan-group">Gardner Vaughan Group</a> has officially commenced construction on Bronze on Chevron, celebrating the sod turning of its first-ever Gold Coast development and marking a significant milestone in the company's continued expansion across South East Queensland.&nbsp;

Following the successful delivery of premium residential developments throughout Brisbane and the Sunshine Coast, <a href="https://www.apartments.com.au/new-apartments/bronze-on-chevron-8-mawarra-street-chevron-island-qld-4217">Bronze on Chevron</a> represents Gardner Vaughan Group's entry into the Gold Coast market. Bronze will deliver 119 one, two, three and four-bedroom apartments above two ground-level retail tenancies.

[smartcode_project:default project_id=107520 project_image_fid=367193]

The recent sod turning ceremony was attended by Deputy Mayor Mark Hammel, President of the Surfers Paradise Surf Life Saving Club, Cassandra Sedgman, project consultants, purchasers, project partners and invited guests to celebrate the commencement of construction.&nbsp;

Gardner Vaughan Group Chief Executive Officer Simon Betteridge said Bronze on Chevron represented an exciting new chapter for the business.&nbsp;

"We've spent almost four decades building homes that respond to the way people want to live, and we're excited to bring that experience to <a href="https://www.apartments.com.au/developments/chevron-island-qld-4217">Chevron Island</a>," Betteridge said.

"Bronze on Chevron is particularly significant because it marks Gardner Vaughan Group's first development on the Gold Coast following many successful projects across Brisbane and the Sunshine Coast."

[smartcode_project:default project_id=107520 project_image_fid=367183]

Betteridge said the ground breaking is a proud moment for the&nbsp;team and their purchasers, who can now see their future homes beginning to take shape.&nbsp;

"As both developer and builder, we're able to oversee every aspect of the project from design through to construction, ensuring the quality and attention to detail Gardner Vaughan Group has become renowned for."&nbsp;

Designed by acclaimed architectural practice <a href="https://www.apartments.com.au/architects/cottee-parker-architects">Cottee Parker</a>, Bronze on Chevron has been thoughtfully designed to complement Chevron Island's evolving streetscape while embracing its relaxed coastal lifestyle.

The development will offer generous residences with refined interiors, premium finishes and resort-style amenities, with completion anticipated in early 2029.&nbsp;

[smartcode_project_cta:default project_id=107520]

The development will offer generous residences with refined interiors, premium finishes and resort-style amenities, with completion anticipated in early 2029

Gardner Vaughan Group breaks ground on first Gold Coast development, Bronze on Chevron

Off the plan

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More than half of all recent off-the-plan (OTP) apartments in Sydney and Melbourne have been settling with a valuation below their contract price, according to the latest findings from CoreLogic.
Their data shows that 60% of OTP apartments in Sydney, and 52.9% in Melbourne are now worth less their their original contract price, based on August settlements.
In 2017 less than 16% of newly constructed NSW units were valued below contract price after they were completed.
CoreLogic's head of research, Tim Lawless, told the ABC when many of these newly completed apartments were originally sold off the plan back in 2016 and 2017, the market was very different.
"We were seeing values rising at about 15% to 20% per annum in Sydney and Melbourne," Mr Lawless said.
"Now cast your mind forward to 2019 and we've seen prices come down in Sydney by 15%. In Melbourne, they're down by about 11%.
"A lot of those off-the-plan buyers have seen a very fundamental shift in the value of the project that they purchased a couple of years ago," he added.
Mr Lawless also brought up the issue of oversupply, as well as concerns around construction quality, remediation costs and flammable cladding.
"That [is] probably also weighing on the minds of people in the marketplace and potentially affecting the resale value of those properties as well," he concluded.
</body></html>

j.ballantyne1990-6AQqhLzZaK

Majority of OTP apartment on settlement in Sydney and Melbourne worth less than purchase price

<html><body>
It is easy to get caught up in the excitement of purchasing a new apartment, particularly when you are presented with beautiful, stylish, modern designs.
It's the same whether you are a first time buyer right through to the downsizer.
But you cannot let your excitement get in the way of doing proper due diligence, or it can really cost you, Parramatta Stacks solicitor, Zohra Ali warned this week.
Ali suggests that off the plan (OTP) buyers can never be too careful.
The risks involved in off the plan purchasing emerged recently after the collapse of the Sydney-based Ralan Group, the longtime apartment developer.
It has left hundreds of apartment buyers at risk of losing their deposits for their intended Arncliffe acquisitions.
Like other off the plan purchasers they put forward a deposit - generally being 10 percent - before their property has been built. But these Arncliffe buyers went further and released their deposit for the developer who'd promised a high rate of return during the intervening period. 
The apartment buyers who have released their deposits will be considered as unsecured creditors, ranking behind secured lenders the ATO, Westpac, NAB, St George, Wingate Group and Balmain NB Commercial Mortgages. 
Not all off the plan contracts present the same level of risk, and as with all investments, there are important things to research.
Ali says off the plan buyers should seek independent legal advice as well as financial advice prior to signing off.
"Ultimately an off the plan buyer is purchasing something that does not exist yet," Ali noted.
She points out there are many players involved from the time of signing the contract to having it ready for settlement, including the developer, council, valuers, builders and certifiers.
"With so many players involved, it only follows that the risk of something going wrong increases exponentially to when purchasing an already built home."
An already built home is a fairly simple process – but does often involve the cautionary pest and building inspection reports during the cooling off period.
Your lawyer can help you assess the risk level of entering into an off the plan transaction by undertaking some due diligence on the proposed developer and also the builder whose bankrupcy could see construction halted indefinitely.
Ali says she wouldn't ever contenance a client releasing the deposit in an OTP situation.
"There is no reason for why a deposit should be released to a developer, and if anything, the request should serve as a red flag as to the developer’s financial situation.
"What happened to Ralan is a perfect example of what can happen if your deposit is not sitting safely in a trust account."
She describes the situation that the Ralan buyers have found themselves in was "a terrible situation."
"It will definitely take a large, financial toll on the affected families.
"To face losing your deposit this way, and at a time where the market is at a downturn and is otherwise the perfect time for a first home buyer to purchase, would be absolutely devastating."  
Ali adds even if you do all the due diligence, and ensure that you go with a reputable developer, somethings can still go wrong.
After all developers cannot predict what state the property market and lending standards are going to be in in the future.
This article was first published in the Daily Telegraph.
 
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jchancellor-FAypfDUnLy

Ralan collapse shows off the plan buyers need genuine independent legal and financial advice 

<html><body>
Sydney’s second biggest CBD, <a href="/new-apartments/parramatta-nsw">Parramatta</a>, is seeing an influx of development in the heart of its major business and commercial centre. Growing in population above 27,000 people, residential high rise projects are being focused to the city centre, resulting in a new wave of urban density.

The culturally diverse suburb is the oldest inland English settlement which is now home to a myriad of Heritage buildings, the 10th largest shopping centre in Australia, Westfield Parramatta, the renewed Western Sydney Stadium along the Parramatta River, a vibrant Church Street with boutiques, cafes, bars and Indian and Chinese cuisine options and Western Sydney University. 

With NAB relocating 3000 employees from <a href="/developments/sydney-nsw">Sydney CBD</a> to Parramatta CBD, revamped works of major roads, squares and the main service station, Parramatta is experiencing a major boom.

Here are a few exciting projects igniting the city centre. 
 

<a href="/new-apartments/8-phillip-street-2-10-phillip-street-parramatta">8 PHILLIPS STREET - RESIDENTIAL + HOTEL</a>

<figure><a class="colorbox colorbox-insert-image" href="https://res.cloudinary.com/dz9xllyip/image/fetch/q_auto:good/https://s3-ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/pictures/article-images/woods_bagot_8_phillip_street.jpg" rel="gallery-all" title="Render by Woods Bagot"><img alt="" class="image-article-full-width-580px" height="1043" src="/s3/files/styles/article_full_width_580px/public/pictures/article-images/woods_bagot_8_phillip_street.jpg?itok=w3r_iSHh" title="Render by Woods Bagot" width="580"></a>

<figcaption>Render by Woods Bagot</figcaption></figure>Woods Bagot’s 8 Phillips Street is a 55 story rhomboid-shaped glass tower will feature Sydney’s tallest rooftop bar, ‘Studio 54’ with sweeping views over the city. 
The tower will comprise of 314 luxury one, two and three bedroom apartment configurations including studio and penthouse options and the QT Boutique Hotel with over 200 deluxe rooms and 50 executive suites.

<a href="/architects/woods-bagot">Woods Bagot</a> boldly incorporates the existing heritage building, the 1926 St. Andrew’s Hall, by integrating it into the entrance with the new development floating above, making for a stunningly impressive residents lobby and streetscape. The five story trapeze garden at the entrance to the tower is just a hint of what’s to come with balcony overhanging plants and a rooftop garden featuring contemporary native Australian species, planted to create a secret garden oasis with intimate communal spaces. 
 

<a href="/buildings/the-lennox-12-phillip-street-parramatta">THE LENNOX - RESIDENTIAL</a>

<figure><a class="colorbox colorbox-insert-image" href="https://res.cloudinary.com/dz9xllyip/image/fetch/q_auto:good/https://s3-ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/pictures/article-images/the_lennox_source_jpw.png" rel="gallery-all" title="Render by JPW Architects"><img alt="" class="image-article-full-width-580px" height="722" src="/s3/files/styles/article_full_width_580px/public/pictures/article-images/the_lennox_source_jpw.png?itok=wkRIFLHV" title="Render by JPW Architects" width="580"></a>

<figcaption>Render by JPW Architects</figcaption></figure><a href="/architects/jpw-architects">Johnson Pilton Walker Architects</a>’ The Lennox tower is one of many high rise residential developments springing up throughout Parramatta. Rising 152 metres above the Parramatta River, the uninterrupted views are one of the many 5 star amenities such as a private lounge room with entertainment deck, a pool, outdoor terrace and zen wellness and fitness centre.

The Lennox will be part of the gateway that is set to dominate the CBD’s skyline, being the first one many high rise towers visitors will see as they cross the bridge. The first three floors of the podium will include retail tenancies, a council owned discovery centre, a conference centre and a cafe with an upgrade riverfront for public use.

Many <a href="/developments/parramatta-nsw">Parramatta developments</a> aren’t just privatised residential components, but like The Lennox, have much to offer the public domain whether that be revitalising waterfronts, providing civic spaces or enlivening heritage structures. 
 

<a href="/buildings/west-village-88-church-street-parramatta">WEST VILLAGE - RESIDENTIAL</a>

<figure><a class="colorbox colorbox-insert-image" href="https://res.cloudinary.com/dz9xllyip/image/fetch/q_auto:good/https://s3-ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/pictures/article-images/woods_bagot_west_village.jpg" rel="gallery-all" title="Rendering by Woods Bagot"><img alt="" class="image-article-full-width-580px" height="735" src="/s3/files/styles/article_full_width_580px/public/pictures/article-images/woods_bagot_west_village.jpg?itok=A-Lfi2-l" title="Rendering by Woods Bagot" width="580"></a>

<figcaption>Rendering by Woods Bagot</figcaption></figure>The sophisticated residential tower provides 397 world class apartments across 40 floors and rising 150 metres above the Parramatta skyline. Woods Bagot has designed this high quality tower which aims to give the city centre that new edge and connect to the streetscape with ground floor retail and cafes.

Developers <a href="/developers/ecoworld-international">EcoWorld</a> have enlisted landscape architect Myles Baldwin to conceptualise the podium garden above level 7 with sweeping views of the Sydney CBD with fully equipped chef’s kitchen, alfresco dining options, leafy terraces and a barbeque area.

Rumours are that Malaysian favourite ‘Chinta Ria’ and gourmet Italian providore ‘Salt Meats Cheese’ are to open tenancy on the ground floor strip, proving that collaboration between developers, architects and suppliers have made for a very important and vibrant project.

As this development takes shape, by the time it completes in late 2019, it will have cemented itself into the Parramatta community fabric and truly embodies the city centre moving towards a progressive future. 
UPDATE: <a href="/news/parramatta-s-west-village-tops-out-at-40-levels">West Village tops out at 40 storeys</a> as of late November 2019 with a 95% sales rate success. Designed by <a href="/architects/woods-bagot">Woods Bagot</a>, the tower features 398 luxury one, two and three bedroom apartments which rise from the vibrant ground floor retail precinct. 

 

<h2><a href="/developments/parramatta-nsw-2150">PARRAMATTA SQUARE - OFFICE, MIXED USE</a></h2>

<figure><a class="colorbox colorbox-insert-image" href="https://res.cloudinary.com/dz9xllyip/image/fetch/q_auto:good/https://s3-ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/pictures/article-images/parramatta_square_source_jpw_architects.jpg" rel="gallery-all" title="Render by JPW Architects"><img alt="" class="image-article-full-width-580px" height="363" src="/s3/files/styles/article_full_width_580px/public/pictures/article-images/parramatta_square_source_jpw_architects.jpg?itok=4qxvXTX3" title="Render by JPW Architects" width="580"></a>

<figcaption>Render by JPW Architects</figcaption></figure>Masterplanned by <a href="/architects/jpw-architects">Johnson Pilton Walker Architects</a> as a response to the growing city, Parramatta Square comprises of 6 stand alone buildings with their own importance to the urban renewal precinct. The towers, a commercial tower to which is the new campus for 10,000 Western Sydney University students, a mixed use residential tower, proposed to be the tallest for Parramatta, a 5 Star Green office tower including a civic building, community centre and library, a 5 Star Green commercial and retail building central to the square and dual 5 Star Green energy office towers.

The 6000 square metres of open space is dedicated and centred around the rich heritage sandstone of St. John’s Cathedral and the Parramatta Town Hall and is pedestrianised with green space and public plazas to connect and integrate the new commercial, residential and community buildings.

Connected either side of the precinct by a future light rail extension and Parramatta Station, visitors and locals will be able to flow through the community heart with ease. 

Parramatta Square is about providing a higher quality of life for residents and workers with a world class premium health and fitness club, an A-grade child care facility and bespoke Business and Events centre with meeting rooms and auditoriums making the work/life integration effortless.

 

<h2>ARTHUR PHILLIP HIGH SCHOOL - EDUCATION</h2>

<figure><a class="colorbox colorbox-insert-image" href="https://res.cloudinary.com/dz9xllyip/image/fetch/q_auto:good/https://s3-ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/pictures/article-images/arthur_phillip_-_grimshaw_and_bvn.png" rel="gallery-all" title="Arthur Phillip vertical school by Grimshaw Architects and BVN Architecture."><img alt="" class="image-article-full-width-580px" height="365" src="/s3/files/styles/article_full_width_580px/public/pictures/article-images/arthur_phillip_-_grimshaw_and_bvn.png?itok=PeIvPKpF" title="Arthur Phillip vertical school by Grimshaw Architects and BVN Architecture." width="580"></a>

<figcaption>Arthur Phillip vertical school by Grimshaw Architects and BVN Architecture.</figcaption></figure>Arthur Phillip High School is Australia’s first vertical high school accommodating 2000 students across 16 floors of educational indoor and outdoor facilities. 
With flexible teaching spaces, adaptable room configurations and technology rich rooms that expand small to large for certain class sizes, the design aspect will mean that students and teachers will benefit from their environment with better opportunities for collaboration and personalised learning.

The collaborated architectural and landscape design by <a href="/architects/grimshaw-architects">Grimshaw Architects</a> and <a href="/architects/bvn-architecture">BVN Architecture</a> helps to deliver a truly remarkable community engaged structure aimed to meet the growth of secondary students in and around the Parramatta catchment area.

Opening in 2020, the high school will join the 1000 student facility Parramatta Public School on the existing school sites with combined tennis and basketball courts, a football field and rooftop gardens for both structures as social and environmental consciousness is encouraged.

With this development, Parramatta is set to become an even more exciting, vibrant and inclusive hub for innovation, technology, retail and commercial business. 
A fly through <a href="/news/council-offers-a-glimpse-of-what-parramatta-will-look-like-in-the-near-future">unveiling the future of the CBD</a> has been released via The City of Parramatta Council encompassing 30 different projects that won design excellence competitions over the past four years with the council stating they have a combined development value of $5.5 billion.

<h2> </h2>

 
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Nick Dante

Parramatta: Suburb Guide. Highlighting new developments in Sydney's second CBD

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Buyers in a Sydney apartment block being built by the failed Ralan Group have been told deposits from their off-the-plan purchases have likely already been spent.
The administrator of the collapsed apartment developer is ascertaining the whereabouts of hundreds of deposits for the Arncliffe block and the Ruby at Surfers Paradise.
The semi-complete development, Orchid, was expected to be the showpiece of the private property developer company which fell into voluntary administration earlier this week estimated to owe cred­itors $500 million.
“The development is currently on time with a good proportion of pre-sales,” the administrators Grant Thornton advised yesterday.
But the administrators also noted their “initial estimate is that there is a significant ­deficiency owing to purchasers who elected to release their ­deposit.” Grant Thornton are investigating whether the “side agreements” had effectively granted use of the funds to Ralan as unsecured loans.
It is not usual practice for off-the-plan buyers to release their 10 per cent deposits with most developers instead ­safeguarding the money in trust funds.
“It is uncertain how much, if any, of your deposit you may receive back if you had agreed to release it as an unsecured loan,” the administrators told anxious Arncliffe buyers.
“We are currently in discussion with the relevant stakeholders about next steps regarding the development.
“We believe that the majority, if not all, of the deposits ­released have been used to fund the expenses of the group, including payment of interest on unsecured loans.
“The administrators will be undertaking an investigation into the group’s financial position to establish how these funds have been used and whether any recoveries can be made in the future that will be available to pay you back.”
It is not known what sale prices were achieved but realestate.com.au puts the average Arncliffe apartment price at $630,000, suggesting the deposits could average $63,000.
“If a purchaser did not elect to release their deposit, it is our understanding these funds are being held in the group’s trust account,” Grant Thornton’s Said Jahani advised the 1200 off-the-plan buyers.
The Ralan Group applied in 2014 to build seven apartment towers for the $132 million project on the Princes Hwy.
This article was first published in the Daily Telegraph.
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Off the plan deposits in Ralan Group apartment projects not kept in trust funds

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Victorians buying off-the-plan properties will get greater protection under new laws on termination sunset clauses.
The legislation was presented to state parliament on Wednesday, but backdated to August 23 last year when the legislation was first announced.
“We’re taking action to make sure that Victorians aren’t being ripped off by dodgy developers – the days of misusing sunset clauses to make super profits are over," Consumer Affairs Marlene Kairouz said.
<div>Changes to legislation will make it tougher for developers to deliberately delay projects to take advantage of a return to rising land prices across Melbourne.</div>
There have been concerns of developers returning deposits and on-selling it for a much higher price for house and land packages and off the plan apartments.
The flexibility in residential developments will be significantly reduced as while the purchaser retains the right to unilaterally terminate residential off the plan contracts of sale under a sunset clause, developers will no longer be able to do so.
To minimise the need to rely on a sunset clause, developers may opt for a longer period between the day of sale and the sunset date, to allow sufficient time for obtaining all approvals from the relevant authorities and completing all works required for registration of the plan of subdivision.
Developers will be wary about going to market too early. Consumer Affairs Victoria received 64 complaints in 2018 about sunset clauses.
The new bill had consumer advocates also praising planned curbs on rent-to-buy schemes.
Under changes to the Sale of Land Act, off-the-plan developers of housing estates and apartment blocks will need the permission of buyers, or the Supreme Court, to enact the sunset clause.
Consumer Affairs minister Marlene Kairouz introduced the changes saying the changes would ensure developers were unable to take advantage of those buying off-the-plan. 
The NSW government introduced legislation in November 2015 that requires the vendor to obtain the purchaser’s consent or an order from the Supreme Court before the vendor can terminate an off the plan contract of sale under a sunset clause.
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jonathanchancellor-7SQnKwU6yx

Victorian off the plan buyers to get boosted contract termination sunset clause rights

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The RBA says dwelling investment is likely to be around its peak for this cycle, and is projected to now decline over coming years.
"The pipeline of work to be done on higher-density housing remains very large, which should continue to support activity in the near term."
"This is consistent with reports from construction firms and developers in the bank’s liaison program."
However the RBA noted higher-density building approvals have been trending lower for around a year, and are expected to decline further over coming quarters.
"This implies a much lower level of activity once the current pipeline of work is completed."
"Information from the liaison program also points to a significant fall in pre-sales for new apartments over the past year."
"In addition to the difficulty of obtaining pre-sales, liaison with developers suggests that financial conditions have tightened further over the past six to twelve months."
"As a result, some developers are obtaining financing from alternative sources, though at a higher interest cost."
The bank's statement of monetary policy indicated sales of new detached dwellings have also slowed.
Detached housing investment is forecast to decline in the near term, broadly consistent with the decline in building approvals over the past year.
The RBA also discussed the <a href="/news/tightening-in-lending-standards-not-the-cause-of-housing-credit-growth-decline-rba">tightening in lending standards</a> over the past year not being the cause of the recent decline in housing credit growth.
The monetary policy statement also looked at how the <a href="/news/uncertainty-on-house-prices-set-to-impact-on-demand-for-appliances-and-furnishings-rba">uncertainty on house prices</a> is set to impact on demand for appliances and furnishings.
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Developers are facing difficulties in obtaining OTP-sales: RBA

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Riskwise Property Research has pinpointed Rouse Hill in Sydney's NorthWest as the suburb most at risk of off the plan apartment settlement problems.
Its data shows that off the plan apartments equivalent to three times the current unit stock is yet to settle over the next two years.
Investors currently comprise 57% of purchasers of the 1000 units in the suburb which is located 50 km from central Sydney.
Rounding out the top three are Norwest and Beaconsfield both of which have off the plan apartment stock equivalent to double the existing number of apartments set to settle in the next two years.
Melbourne, Brisbane, Perth and Adelaide also have suburbs in what Riskwise call the settlement risk "Danger Zone".
<img src="https://www.urban.com.au/images/2019/2/5/Rouse%20Hill.JPG" alt="">
</div>
<div class="x_ztzrw">
<div class="x__3t7hh">
"There are a large number of high-rise properties in our capital cities being offered to a smaller number of investors," Riskwise chief executive Doron Peleg said. 
"There are less investors in the market mainly due to credit restrictions. Also, lenders are being more cautious about their loan-to-value ratios (LVRs) and more discerning about who to lend to. This has resulted in a reduction in activity and this has a major impact on the market. Lenders understand that oversupplied suburbs carry a greater degree of risk – and those risks are just as real for the investors who buy in those suburbs."
Most of the suburbs highlighted in the Danger Zone list are already subject to loan blacklists or other such restrictions.
For example requiring significantly higher deposits, up to 30 per cent. 
Such moves will make these properties harder to sell, as brokers needing to increase their volume of mortgage sales to up their remuneration would increasingly steer customers away from higher-risk properties that would take more time to secure financing and had less guarantee of success, Mr Peleg said.
"This overall will potentially reduce the demand for those properties," Mr Peleg told Nine Entertainment's Financial Review. 
"If you have a sub-prime [borrower] and a high-risk property, it means the loan application could take many, many hours if it's approved. The broker will not have too many ways to compensate for those invested hours if the fee is flat. He will try to minimise those loans and even in many cases a broker will work with a consumer and tell them 'This is a high-risk property, maybe you need to consider an existing property'."
Further risks to the swathe of new apartments due to complete and settle over the next two years include the likelihood of a new Labor-led federal government that could more fully implement the royal commission's recommendations against brokers and reduce the negative gearing and capital gains tax breaks available for property investors, he said. 
The outlook for apartments was negative, Mr Peleg maintained. 
"The trend we see – everything regarding consumer protection, responsible lending and scrutinising loan applications – we don't see any indicators that will drive demand for off the plan," he said.
High-rise apartment approvals hit a four-year low in the year ended December, according to ABS figures.
One example of the numerous Rouse Hill developments that can be currently bought OTP is <a href="http://www.villadema.com.au/" target="_blank">Villa De M.A</a> (pictured in title).
Situated on Cudgegong Road, this project has one and two bedroom apartments available for off the plan purchase.
Prices range from $499,000 to $693,000.
<img src="https://www.urban.com.au/images/2019/2/7/Rouse%201.JPG" alt="">
Another example of an under construction OTP development for sale in Rouse Hill is <a href="https://boulevardrousehill.com.au/" target="_blank">The Boulevard</a>.
With prices ranging from $620,000 to $925,000 for one, two and three bedroom apartments, AUX Property Group lauds it as "Sydney's Growth Capital".
Located on Caddies Boulevard, a new Rouse Hill Hospital and Sydney Metro Northwest Rouse Hill Station, are to be constructed in the area.
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Sydney's Rouse Hill is the Australian suburb most at risk of OTP settlement problems: Riskwise

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UBS says Mirvac, Lendlease and Stockland now face a higher risk of settlements falling over because of their exposure to projects sold to buyers at the 2017 peak of the property cycle.
“We see Mirvac as most at risk followed by Lendlease and Stockland,” analysts Grant McCasker and James Druce said.
Australia’s largest property players face a risk of buyers failing to pay at settlement time because of falling apartment prices and valuations, analysts say.
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2019/1/31/Figure1.jpg" alt="">
In a gloomy outlook for three of the nation's largest real estate developers, UBS said apartment sales make up a significant chunk of earnings for Mirvac, in particular, over the next three financial years. 
</div>
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The most at risk projects are in Sydney’s Marrickville and Olympic Park which “appear already out of the money” because Sydney’s apartment price index has fallen five per cent since launch, the analysts said.
St Leonards could also become an issue were prices to fall a further five to 10 per cent.
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2019/1/31/Figure2.jpg" alt="">
The UBS report has surprised industry veterans given <a href="/news/mirvac-defaults-stay-low-amid-price-moderation-and-downturn-in-foreign-buyers">Mirvac's history of reliable buyers</a>, often repeat buyers too.
“We are less concerned about Lendlease's settlement risk given the price growth since the 2015-16 launch dates,” the report said.
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2019/1/31/figure3.jpg" alt="">
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<div class="_1lC_G">Stockland, has minimal exposure to the apartment market, with substantial earnings from land sales for new homes.</div>
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The number of buyers cancelling contracts on land purchases is presently low, but UBS warns that tightening credit, price falls, incentives and lower deposits will increase the number of buyer who will struggle.
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“We expect Stockland's second half settlements to disappoint as cancellation rates increase and settlement times extend,” UBS said.
<div>
Mirvac, Stockland and Lendlease reputedly declined to comment to Nine Entertainment on the UBS report, saying they are in the ''blackout'' phase before the release of their interim reports for the December half, due in the coming weeks.
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2019/1/31/Figure5.jpg" alt="">
But Stuart Penklis, head of residential at Mirvac advised The Australian that Mirvac was monitoring the changing residential market conditions closely.
"It is important to remember that ‘average’ price changes mask significant differentiation between submarkets and housing type.  
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"We believe that our disciplined approach to restocking, our commitment to design excellence, a quality product, and customer care will continue to differentiate us from others in the market,” he said.
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Mirvac most at OTP apartment settlement risk among listed property developer company

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Off-the-plan units top the list of the most perilous property investments, and the risks will rise dramatically if changes to negative gearing and capital gains tax go ahead.
This is according to <a href="http://www.riskwiseproperty.com.au/">RiskWise Property Research</a> CEO Doron Peleg, who says while there are already major risks associated with this type of investment due to a number of factors, including oversupply, the introduction of the reforms if Labor win this year’s federal election will compound them.
The ALP proposes to limit negative gearing to new houses only and reduce the discount on capital gains tax from the current 50% to 25% … and the likelihood of them winning is high, Peleg said. 
“A number of markets across Australia are already experiencing weakness and the introduction of these reforms will hit them hard,” he said.
“Should the ALP policy be implemented there will be reduced demand to purchase rental properties due to the creation of primary and secondary markets, and this will cause new dwelling prices to decline in many regions. 
“The second owner won’t receive the same tax benefits of depreciation etc as the primary owner when they buy a property. They will not be able to claim negative gearing against their wages and the capital gains tax discount will be cut in half. Therefore, the vendor will have to drop the value of the property because the benefits to the buyer are lower, and it is therefore not as attractive to potential buyers.
“So, when a market is already weak, for example off-the-plan units in an over-supplied area, as we see in capital cities around the country, this will contribute further to the price reductions.”
He said an example of this was inner-city Brisbane where weakness in the market had led to lower valuations, rising defaults on settlements, major discounting, falling rents and ‘over-the-top’ incentives to get buyers across the line.
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2019/1/22/Brisbane%20Inner%20City%20Units%20November.jpg" alt=""> 
Brisbane City, Fortitude Valley and South Brisbane were all named in the Top 10 of the RiskWise 2018 list of the <a href="https://www.riskwiseproperty.com.au/News/high_risk_alert">100 Worst Off-The-Plan Suburbs</a> in Australia, as were Zetland and Epping in Sydney and Southbank in Melbourne where oversupply of units is a huge issue. 
In South Australia, the highest risk area for units was Adelaide CBD (postcode 5000), where oversupply was extreme and, according to CoreLogic, had delivered -2.9% capital growth in the past 12 months. In Perth they delivered -6.5% capital growth. The Perth - Inner area has the highest rate of unit oversupply in Western Australia with 4362 units in the pipeline (a 11.1% increase to the current stock), while the Greater Perth area has 12,687 units in the pipeline which is a 6% increase to the current stock.
He said the widespread oversupply issue was universally acknowledged by banks which had ‘blacklists’ for postcodes suffering potential unit saturation. In addition, he said lenders were scrutinising loan applications much more vigorously and either required a much higher deposit as security or were turning down the application entirely.
“It must also be remembered that rental units and owner-occupier units are not fully substitute products. The dwelling types and needs of owner-occupiers are often greatly different from the dwelling types and needs of renters,” he said.
“Units that are used by owner-occupiers are larger than units that are typically used as rental properties and, more importantly, the price per square metre of rental properties is higher than the price per square metre of owner-occupied properties, especially in Sydney and Melbourne. This means that, overall, rental units in Sydney and Melbourne are significantly less affordable than units that are owner-occupied.
“All this added up suggests that if the proposed changes to negative gearing and capital gains tax take place it is likely to put off-the-plan units at their highest risk ever and this includes equity risk, cashflow risk and settlement risk.”
Peleg said unless there was phenomenal capital growth, the value of off-the-plan property in many regions was likely to be reduced and it would become significantly harder for investors to enjoy capital growth, at least in the foreseeable future. 
“And if you consider that many of the prices for off-the-plan units include a significant commission to the marketer, between 5-6% of the value of the property and sometimes even more, and with the current risks to settle the property … all of these things together make purchasing off-the-plan units in many regions in Australia extremely high risk,” he said.
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Inner Brisbane off-the-plan units the riskiest of all property investments: RiskWise

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When it comes to risk, off-the-plan units top the list for potential investment disasters, especially if changes to negative gearing and capital gains tax go ahead.
It’s a risk that’s compounded by a number of factors, says RiskWise Property Research CEO Doron Peleg, and includes equity risk, cashflow risk and settlement risk.
“The first, and most obvious, is the risk of oversupply which is something we’ve seen in inner-city Brisbane which has created weakness in the market leading to lower valuations, rising defaults on settlements, major discounting, falling rents and ridiculous incentives to get buyers across the line,” Mr Peleg said.
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2018/11/6/brisbane%20inner%20city%20unit%20market.jpg" alt="">
Brisbane City, Fortitude Valley and South Brisbane have all been named in the Top 10 of the RiskWise 2018 list of the 100 Worst Off-The-Plan Suburbs in Australia, as have other areas in Sydney (eg Zetland and Epping) and Melbourne (eg Southbank) where oversupply of units is a huge issue.
He said the widespread oversupply issue was universally acknowledged by banks which had ‘blacklists’ for postcodes suffering potential unit saturation. In addition, lenders are scrutinising loan applications much more vigorously and either require a much higher deposit as security or they may turn down the application entirely. “It must also be remembered that rental units and owner-occupier units are not fully substitute products. The dwelling types and needs of owner-occupiers are often greatly different from the dwelling types and needs of renters,” he said. “Units that are used by owner-occupiers are larger than units that are typically used as rental properties and, more importantly, the price per square metre of rental properties is higher than the price per square metre of owner-occupied properties, especially in Sydney and Melbourne. “This means that, overall, rental units in Sydney and Melbourne are significantly less affordable than units that are owner-occupied.” However, Mr Peleg said it was the potential changes to negative gearing and capital gains tax if Labor were to win the next Federal election, which was likely, that put off-the-plan units at their highest risk ever. He said should the ALP policy be implemented there would be reduced demand to purchase rental properties due to the creation of primary and secondary markets, and this would cause new dwelling prices to decline in many regions. “The transfer of the property effectively changes its status from the primary to the secondary market, from a taxation perspective, however, the same taxation benefits from a property in the primary market would not be available to a subsequent investor,” he said. “In other words, if you buy an off-the-plan unit, and there are no changes to negative gearing, when you sell the property the new investor will have the same tax benefits of depreciation etc as the original owner, and so the fair market value will remain similar to both the buyer and the seller, as the financial benefits from the property are the same. “However, if the changes go ahead, the new purchaser will not be able to claim negative gearing against their wages and the capital gains tax discount will be cut in half. Therefore, the vendor must drop the value of the property because the benefits to the buyers are lower, and it is therefore not as attractive to potential buyers.” Mr Peleg said unless there was phenomenal capital growth, the value of off-the-plan property in many regions was likely to be reduced and it would become significantly harder for investors to enjoy capital growth from many off-the-plan units, at least in the foreseeable future. “And if you consider that many of the prices for off-the-plan units include a significant commission to the marketer, between 5-6 per cent of the value of the property and sometimes even more, and with the current risks to settle the property … all of these things together make purchasing off-the-plan units in many regions in Australia extremely high,” he said.
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