<p>A who's who of Australian surfing, business and entertainment has emerged on title records following the completion of Esprit Rainbow Bay, the latest boutique beachfront apartment development by former professional surfer Paul Gedoun's S&amp;S Projects.</p>

<p>The completed project has attracted an enviable collection of owners, many with long-standing ties to the southern Gold Coast and the surf culture that has helped define Rainbow Bay and neighbouring Kirra for generations.</p>

<p>Given Gedoun's own background in surfing, it perhaps comes as little surprise that some of Australia's most recognisable surfers have chosen to buy into the development overlooking one of the country's most celebrated stretches of coastline.</p>

<p>Pezet Matheson directors Jayde Pezet and Todd Matheson launched the project in late 2021, and have managed the sales campaign all the way through to its sell-out and recent completion.</p>

<p><img alt="Esprit" data-entity-type="file" data-entity-uuid="08fc6261-b84e-4b09-8a44-66d3067fd0d1" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-29%20at%208.51.05%E2%80%AFAM.png?VersionId=4AOcb6ETZwNUnMPdTtz1B3pZAIB_jgZ2" /></p>

<p>Former world champion Mick Fanning, who grew up in Coolangatta, secured an apartment in 2023. He paid&nbsp;$2.07 million. Last year he sold his Bilinga home for over $16 million.</p>

<p>Three-time world champion Joel Parkinson also purchased in the development, alongside big wave surfer Mark Mathews. Mathews bought the most expensive apartment in the building, spending just over $4 million.</p>

<p>Joining them is Rip Curl founder Doug Warbrick, whose company helped shape Australia's global surfing industry over the past five decades.</p>

<p>The appeal of Rainbow Bay has extended well beyond the surfing community.</p>

<p>International DJ Paul Fisher purchased an apartment through his investment vehicle, YLB Developments, an abbreviation of his trademark phrase "You Little Beauty".</p>

<p>The purchase comes as Fisher and his wife Chloe are developing their own luxury apartment project further north in Palm Beach. Their boutique beachfront development, Pescado, comprises just seven apartments on Jefferson Lane, which start from just shy of $6 million. The couple intend to retain the two-level penthouse as their Australian base between international touring commitments.</p>

<p>Melbourne Storm coach Craig Bellamy and his wife Wendy have also invested in Esprit, purchasing two apartments after spending decades holidaying on the southern Gold Coast. They also have a luxury apartment in Joe Adsett's Rockpool, less than 400m away from Esprit.</p>

<h2>Boutique project draws owner-occupiers</h2>

<p>Esprit launched in 2021 and sold strongly, with buyers drawn to its boutique scale, beachfront position and contemporary design.</p>

<p>The completed development comprises 94 apartments across 11 levels, offering expansive floorplans designed primarily for owner-occupiers rather than the investor market.</p>

<p>Crowning the building is Club Esprit, pitched as being the Gold Coast's first residential rooftop wellness centre. The roof features a&nbsp;25 metre magnesium lap pool, which is surrounded by wet daybeds and poolside cabanas,&nbsp;multiple barbecue areas,&nbsp;a yoga and relaxation play lawn, and a private dining room with a kitchen scullery, bar, lounges, and an outdoor terrace.</p>

<p>The wellness centre is&nbsp;fully equipped with a Technogym, ice bath, infra-red sauna, steam room, thermal room, and treatment room. The roof has views spanning&nbsp;Rainbow Bay, Snapper Rocks and the Pacific Ocean.</p>

<h2>S&amp;S Projects continues to shape Rainbow Bay</h2>

<p>S&amp;S Projects founder Paul Gedoun has become one of the key figures behind Rainbow Bay's evolution over the past several years.</p>

<p>After establishing S&amp;S Projects, Gedoun has focused on delivering lifestyle-driven apartment developments designed primarily for owner-occupiers seeking a permanent coastal home.</p>

<p>Esprit is Gedoun's third completed project in Rainbow Bay, following Flow and Awaken, both of which achieved record prices for the suburb.</p>

<p>He is now delivering <a href="https://www.apartments.com.au/new-apartments/radia-rainbow-bay-271-boundary-street-coolangatta-qld-4225">Radia Rainbow Bay</a>, a 38-apartment development on Boundary Street that is currently selling, and has no plans to leave the precinct anytime soon. S&amp;S Projects has also lodged plans for its fifth Rainbow Bay development, an 88-apartment project on Boundary Street featuring a strong wellness focus.</p>

<p><em>Read more:&nbsp;<a href="https://www.apartments.com.au/news/qld/first-look-s-s-projects-proposes-88-apartment-wellness-tower-at-coolangattas-boundary-street">First look: S&amp;S Projects proposes 88-apartment wellness tower at Coolangatta's Boundary Street</a></em></p>

<p>&nbsp;</p>

<p>&nbsp;</p>

<p>&nbsp;</p>


Joel Robinson

Who's who of buyers revealed as Esprit Rainbow Bay settles

<p>Nature Based Cities (NBC), the not-for-profit organisation focused on improving biodiversity and nature outcomes in urban development, has launched its latest industry design guidelines and accreditation framework, this time targeting precinct-scale residential communities.</p>

<p>The move extends NBC’s influence beyond its initial focus on medium and high-density residential developments. Several projects have already achieved NBC accreditation since the launch of its Medium &amp; High-Density Residential Guidelines in early 2025.</p>

<p>The expansion into masterplanned communities and new residential precincts reflects the growing need for stronger nature-positive benchmarks as Australia’s outer suburban growth corridors continue to expand at pace.</p>

<p>Paul Hameister OAM, NBC Founder and the Executive Chairman of Melbourne developer Hamton who itself leans heavily into nature and biodiversity in its developments, says the&nbsp;nature-first approach to mitigate the effects of climate change has become standard in other parts of the world such as the UK, but Australia is lagging.&nbsp;Australia’s environmentally sustainable design (ESD) rating tools have no minimum mandatory requirements for living landscapes.</p>

<p>“We’ve always wanted to do more, and we know other developers who want to do more, but the ESD rating tools just aren’t there,” Hameister says. “In Australia, you can have a five-green-star rated building that’s concrete and glass with not a blade of grass.<br />
<br />
“The focus is on reducing emissions, which is laudable, but there hasn’t been enough attention paid to protecting and re-establishing nature. We need both for the health of the environment and for communities.”</p>

<p>He says that having now&nbsp;made good progress in supporting developers of medium and high-density residential projects, NBC is now looking to bolster better nature-based decision-making and recognise developers of greenfield projects in the outer ring and large inner-ring brownfield precincts, who want to champion nature and living landscape as a defining feature.</p>

<p>Since 2022, the not-for-profit has sought to remove the roadblocks preventing developers from incorporating nature and living landscapes into their projects, shifting the conversation from the reduction of emissions and grey infrastructure, toward recognising nature as an essential infrastructure.</p>

<p>The New Communities Design Guidelines and Scorecard arm developers with the tools needed to deliver a nature positive outcome for their new communities. Intended to be adopted at the outset of the planning process, the guidelines are designed to help create communities that are cooler, healthier and more resilient while also enhancing social wellbeing and long-term economic value.&nbsp;</p>

<p>New Communities developers seeking accreditation will be independently assessed across a range of key criteria including ecology, tree canopy, biodiversity, and walkability. Once the masterplan is complete and submitted for approval, the scorecard is formalised based on proposed outcomes. Projects that meet the NBC criteria will receive either Commended or Exemplary accreditation outcomes, creating a clear benchmark for nature-positive new communities in Australia.&nbsp;</p>

<p>Janis Fischer, Director at Tract and NBC Advisory Council member, said the development of new communities in our suburbs can have a substantial impact on nature and biodiversity.</p>

<p>"By incorporating nature-based design principles at the inception of a project, developers and their design teams can achieve nature positive outcomes that are good for both people and the planet.’’&nbsp;</p>

<p>NBC accredited New Community projects will gain access to NBC branding and marketing tools to help communicate their nature-based credentials to purchasers and the broader market.&nbsp;</p>


Nature Based Cities: A new Australian benchmark for developing nature-positive new communities

<p>Apartment buildings are increasingly being designed around how people actually live day to day, not just how they want a building to look.</p>

<p>For buyers, that shift is showing up in practical inclusions that respond to changing habits. Work-from-home spaces, EV charging, wellness amenities, secure bike storage and parcel management are becoming part of the broader apartment conversation, reflecting a move toward buildings that reduce friction in everyday life.</p>

<p>Online shopping has become one of the clearest examples of that change.</p>

<p>Australians spent a record $82.6 billion online in 2025, with nearly one in four retail dollars now spent online. That has made parcel delivery a regular part of apartment living, rather than an occasional inconvenience.</p>

<p>For apartment residents, however, the delivery process can be less straightforward than it is for detached homes. Parcels may be left in lobbies, redirected to Post Offices, missed entirely, or placed under the responsibility of building managers and concierge teams.</p>

<p>That is why secure parcel infrastructure is increasingly being considered alongside more familiar apartment amenities.</p>

<p><iframe allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" allowfullscreen="" frameborder="0" height="315" referrerpolicy="strict-origin-when-cross-origin" src="https://www.youtube.com/embed/-VjjLwoViX0?si=A3k7ws9NX35Uac7_" title="YouTube video player" width="560"></iframe></p>

<p>Australia Post Parcel Lockers offer one way to address the issue. When a parcel arrives, residents receive a notification through the AusPost app or SMS, then collect it using a QR code or one-time PIN. The parcel is kept secure, accessible and removed from common areas.</p>

<p>The broader Parcel Locker network now includes more than 1,500 locations across Australia, positioned at Post Offices, shopping centres, supermarkets, transport hubs and other accessible locations.</p>

<p>For new apartment projects, the relevance is clear. A building’s amenity offering is no longer only about lifestyle spaces, but also about convenience, security and functionality.</p>

<p>As buyer expectations evolve, secure parcel delivery is becoming part of the same design conversation as flexible working, sustainable transport and resident wellbeing.</p>

<p>It is one less thing for residents to worry about, and another example of apartment design adapting to the way Australians now live.</p>


Apartment design is adapting to the way Australians shop

<p>While school holidays and trips to Europe tend to define the winter property market, there's been no cold snap at <a href="https://www.apartments.com.au/new-apartments/the-walden-north-sydney-177-walker-street-north-sydney-nsw-2060">The Walden</a> in North Sydney.</p>

<p>Developer-builder&nbsp;<a href="https://www.apartments.com.au/developers/aland">ALAND</a> sold more than $35 million worth of apartments throughout June, including a $6.8 million apartment that now ranks among the highest apartment sales ever recorded in North Sydney.</p>

<p>SRM Residential agent Ben Stewart said buyer demand throughout June reflected a mix of improving market confidence and longer-term thinking from owner-occupiers.</p>

<p>"We're seeing strong demand from owner-occupiers who are taking a longer-term view," Stewart said.</p>

<p>"Many recognise the opportunity to secure an apartment in an iconic building and premium location while values remain attractive. They may initially lease the property, but the intention is to eventually move in themselves, rather than purchasing purely as an investment."</p>

<p>[smartcode_project:default project_id=134323 project_image_fid=367129]</p>

<p>Located at 177 Walker Street, The Walden will deliver 161 one, two, three and four-bedroom residences across a 30-storey tower designed by Rothelowman. Every apartment occupies a corner position, maximising natural light, cross ventilation and views across Sydney Harbour, the Opera House, Sydney Heads and the northern districts.</p>

<p>Rather than a traditional balcony, the residences feature winter gardens that seamlessly extend the open plan living areas, creating versatile spaces for relaxing or entertaining throughout the year. Floor-to-ceiling glazing draws in natural light while showcasing sweeping views from the building's elevated Walker Street position.</p>

<p>Every apartment features high-end Calacatta marble, bespoke joinery, and fully integrated appliances.</p>

<p>The larger residences have been planned with distinct entertaining and private zones, with many master suites positioned on corners to capture natural light and harbour views. Walk-in dressing rooms, freestanding baths and refined stone finishes reinforce the house-like feel that has resonated with downsizers and owner-occupiers.</p>

<p>[smartcode_project:default project_id=134323 project_image_fid=6393]</p>

<p>Rothelowman Principal Ben Pomroy said the project was designed to make the most of its unique position overlooking the harbour.</p>

<p>"The Walden is a celebration of all things beautiful, curated for those who expect nothing less than exceptional," Pomroy says.</p>

<p>"Meticulously designed entertaining spaces and light-filled living areas that capitalise on capturing the natural beauty of Sydney's iconic harbour."</p>

<p>Residents will also have exclusive access to The Pavilion, a dedicated amenity building featuring a rooftop pool, wellness studio, gymnasium, sauna, concierge service, residents' lounge, private dining spaces and work-from-home facilities.</p>

<p>[smartcode_project:default project_id=134323 project_image_fid=6402]</p>

<p>The project marks ALAND's first major luxury apartment development in Sydney's inner-city market after more than two decades delivering residential communities across Greater Sydney.</p>

<p>Founder and CEO Andrew Hrsto previously said the rarity of the Walker Street site made it an opportunity the company could not overlook.</p>

<p>"This is a rare opportunity to bring a truly exceptional project to life in one of Sydney's most iconic locations, and to showcase our craftsmanship and design expertise at a world-class level," Hrsto said.</p>

<p>[smartcode_project:default project_id=134323 project_image_fid=6383]</p>

<p>The Walden has been introduced to the market at a time when demand for living in North Sydney is at an all-time high. Billions of dollars have been invested in infrastructure, including the recently opened Victoria Cross Metro station, located just 300 metres from The Walden, providing residents with direct access to the Sydney CBD in just minutes.</p>

<p>Private investment has also transformed the area through the arrival of new retail and dining destinations, elevating the lifestyle offering in what was once considered primarily a commercial precinct rather than an aspirational residential address.</p>

<p>The Walden is currently under construction and is scheduled for completion in 2028.</p>

<p>[smartcode_project_cta:default project_id=134323]</p>


ALAND records $35 million in sales in North Sydney as The Walden bucks quiet winter selling season

<p>The long-awaited redevelopment of the former Eastlakes Shopping Centre site has reached a major milestone, with Conquest's plans for a new mixed-use precinct officially placed on public exhibition.</p>

<p>The State Significant Development Application would transform the 1.7-hectare site at <a href="https://www.apartments.com.au/new-apartments/19a-evans-avenue-eastlakes-nsw-2018">19A Evans Avenue</a> into one of Sydney's largest urban renewal projects, delivering 736 apartments above a new shopping centre anchored by Woolworths, alongside specialty retail, dining, commercial space and new public open spaces.</p>

<p>The public exhibition marks the next chapter for the project after <a href="https://www.apartments.com.au/developers/conquest">Conquest</a> acquired the stalled Stage Two development from Crown Group, who completed the first stage across the road prior to their voluntary liquidation.</p>

<p><img alt="First look: Conquest unveils plans for 736-home Eastlakes Shopping Centre redevelopment" data-entity-type="file" data-entity-uuid="5fca22c5-d1ed-4e2c-8801-03f7df1eafc8" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/eastland%20podium.png?VersionId=uomwr41nF8CmLUZRDcu3mHQechlbxucS" /></p>

<p>&nbsp;</p>

<p>Designed by DKO Architecture, the proposal comprises four residential buildings ranging from 14 to 18 storeys above a two-level retail podium. The development would deliver 736 apartments, including 74 affordable homes, 215 Build-to-Rent apartments and 521 market residences. Provision has also been made for dual-key apartments, which could increase the total number of dwellings to 877.</p>

<p>At ground level, the shopping centre has been designed as the suburb's new meeting place, anchored by a full-line Woolworths and complemented by a curated mix of fresh food retailers, cafés, restaurants, health services and everyday convenience shopping. Generous pedestrian links and landscaped public spaces will connect the retail precinct through to Jack Mundey Reserve, creating a more walkable and connected neighbourhood.</p>

<p>Conquest CEO Michael Akkawi said the redevelopment was about far more than replacing a shopping centre.</p>

<p>"Eastlakes has been overlooked for too long, and this is the community’s moment. We are building a shopping centre and homes, a genuine heart for the suburb, and we genuinely want locals to help shape it."</p>

<p>"We enrich communities through the creation of homes, places, and experiences designed for life, built to last, and owner for generations. That starts with listening, so we warmly encourage everyone with a connection to Eastlakes to view the plans and share their thoughts."</p>

<p><img alt="First look: Conquest unveils plans for 736-home Eastlakes Shopping Centre redevelopment" data-entity-type="file" data-entity-uuid="22f6fb20-54fb-4bd7-8a92-48fafdd00608" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/eastland.png?VersionId=cugp7s9hrMHGJJdYzkeAkrFoQgnF4GXf" /></p>

<p>DKO said the design had been shaped by the site's landscape setting and surrounding open space.</p>

<p>"Our vision for the site embraces its unique Bidjigal identity by blending the residential living with generous landscaping and a material palette inspired by the Bidjigal locality, and celebrating the panoramic views to Botany Bay and the wetlands reserves."</p>

<p>"Taking cues from Country, we seek to harmonise built form with the landscape and lightly touch the earth. By reconnecting, retaining and regenerating existing ecology, and weaving in natural elements, we can deepen our connection to Country."</p>

<p>The landscape strategy extends across the podium and rooftops, incorporating communal gardens, children's play areas, lawns, community gardens, family gathering spaces and extensive tree planting. New landscaped links will also strengthen the connection between the precinct and Jack Mundey Reserve, while publicly accessible open spaces have been integrated throughout the development.</p>

<p>The proposal builds on Conquest's broader placemaking strategy for the site. Through an ongoing partnership, local artist Joe Rashbrook has been appointed Urban Art Curator, working alongside young residents to transform the project's site hoardings into a public art gallery that allows the community to engage with the redevelopment before construction is complete.</p>

<p>Conquest has rapidly expanded its development pipeline since acquiring the Eastlakes site, with more than $6 billion worth of mixed-use projects now in planning across Sydney, including Stanmore, Castlecrag and Waterloo.</p>


Conquest CEO Michael Akkawi said the redevelopment was about far more than replacing a shopping centre.

First look: ‘Far more than replacing a shopping centre’ as Conquest unveils 736-home Eastlakes redevelopment

Property investment

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<p>It’s a great time to be a landlord in Australia. With rare exceptions, vacancies are ultra low, rents are rising and there’s massive momentum behind prices.</p>

<p>A nationwide property boom is under way (with the big city inner-ring unit markets the exception) and the curious thing is that investors haven’t been joining the party. </p>

<p>The growth we saw in most markets in 2020 was driven by owner-occupiers, with first-home buyers leading the charge and other home buyers, especially lifestyle-seekers, prominent as well.</p>

<p>Investors were sitting on the fence, worried firstly about the September Cliff which failed to materialise and now apparently concerned about a potential March Cliff.</p>

<p>[smartcode_project:default project_id=600]</p>

<p>They’ve been waiting to see what would happen, before making decisions. And here’s what has happened while they’ve been fence-sitting – the new data from Domain shows that all capital cities had house price growth ranging from solid to strong in 2020, as did most of regional Australia. There was particularly notable uplift in the December Quarter.</p>

<p>This confirms earlier data from CoreLogic and both confirm the anecdotal evidence from the coal-face of markets which shows properties receiving multiple offers and selling for more than the asking prices, often before being formally listed.</p>

<p>Other research shows that rents have been rising in many parts of Australia, on the back of vacancy rates so low that it constitutes a national rental crisis.</p>

<p>So the hesitant investors have missed the first phase of the national property boom.</p>

<p>If they’d bought a year ago in many parts of Australia, their properties would now be worth 10%, 15% or 20% more than they paid.</p>

<p>For those who bought in sexy lifestyle locations like Byron Bay and the upmarket areas of the Sunshine Coast, a $1 million investment a year ago would now be worth around $1.3 million.</p>

<p>[smartcode_project:default project_id=84861]</p>

<p>If you’d bought a $400,000 property in Bendigo 12 months ago, it would likely now be worth around $460,000 (based on the median price data).</p>

<p>So it’s time for investors to stop procrastinating and get busy. And the latest ABS data on loans indicates that, at last, investors are starting to get involved.</p>

<p>This, in fact, is typical investor behaviour. Investors don’t lead property cycles, they react to them. They stampede into the market when they hear there’s a boom happening.</p>

<p>So I expect a big surge of activity from investors in 2021. There are too many good reasons to become buyers of well-located real estate and make it available to a hungry rental market.</p>

<p>The uplift in investor buyers will add further energy to the momentum already happening in markets across the nation.</p>

<p>It will make a national property boom that much more certain.</p>

<p>Terry Ryder is the founder of hotspotting.com.au</p>

<p>ryder@hotspotting.com.au</p>

<p>twitter.com/hotspotting</p>
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The hesitant investors have missed the first phase of the national property boom.



terryryder

It’s time for real estate investors to stop procrastinating and get busy: Hotspotting's Terry Ryder

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<p><span>Tim Mackay, principal of financial advice firm Quantum Financial, says property investors struggling to pay higher demanded deposits on off the plan purchases through their SMSFs need to be careful they do not breach Australian Taxation Office rules.</span></p>
<p><span>Abrupt lending policy changes on required deposit has meant some buyers have lost out on valuable tax deductions given the top up deposit balance was a non-concessional (or after-tax) contribution. </span></p>
<p><span>His other recommendations to Australian Financial Review readers included:</span></p>
<ul>
<li><span>Consider if the investment is worth keeping. It might be worth cutting losses rather than losing generous tax concessions or being forced to liquidate scheme assets on unfavourable terms;</span></li>
<li><span>Reduce costs;</span></li>
<li><span>Sell other assets in the fund to reduce the debt;</span></li>
<li><span>Contribute more to your super – either through personal contributions or salary-sacrificing (making pre-tax contributions);</span></li>
<li><span>Seek a better deal on your loan;</span></li>
<li><span>Review existing advice and question how it allowed you to get into mortgage stress.</span></li>
</ul>
<p>Last week it was suggested one in three off-the-plan Bankstown district investors are facing financial distress completing purchase of their properties because of tough new lending rules for higher deposits.</p>
<p><span>Chan &amp; Naylor partner Peter Ristevski's analysis suggested he had not had anyone's sale fall through yet with second mortgages being secured at higher interest rates.</span></p>
<p><span>Financial planner Sam Henderson, chief executive of Henderson Maxwell, says he thinks buying a property using SMSF was a great idea for a solid long-term strategy, but only for the right people and under the right conditions. </span></p>
<p><span>"The idea of an off-the-plan development diminishes my excitement owing to potential onerous sunset clauses (whereby developers can change the terms and price), banks altering their lending criteria between exchange of contract and settlement, developers potentially going bust and the common issue of being surrounded by scores of similar properties in overdeveloped suburbs," he suggested to AFR readers.</span></p>
<p><span>"Consider, for example, that you buy a $700,000 property and put down your 10% deposit of $70,000.</span></p>
<p><span>"Let's assume the bank has agreed to fund your loan of 80% (thereby allowing you to use $140,000 of your fund as a deposit) and that you will fund the stamp duty via your next contribution of $30,000.</span></p>
<p><span>"Let's say the bank changes its view on SMSF loans and drops its LVR (loan to value ratio) so it will lend to 60 per cent, as many of the banks do for commercial properties.</span></p>
<p><span>"Well, you've just done your $70,000 deposit!"</span></p>
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jchancellor-FAypfDUnLy

Off the plan SMSF investors face challenges under higher deposit era

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<p>If there's one thing I've learnt from developing property, it's that you definitely need a 'can do' attitude.</p>
<p>This week, I've come across so many 'can do' people that it's inspired me to write about them.</p>
<p>So what's the definition of 'can do'?  It's basically, when everything goes to shit and things seem totally not doable, then a person with a 'can do' attitude always finds a way.  So today, this goes out to the many people who've I've crossed paths with and who've reminded me of how we really can achieve anything we put our minds and hearts to.</p>
<p>Meet Bob from Port Macquarie, he's an older gentleman who has been emailing me for the past five years on and off. Every now and then I'll get a message from Bob. He may be responding to one of my Property Observer stories or our newsletters, but he always asks different questions. Well, this week Bob decided to take a big step and to be the property developer he'd wanted to for some time. His purpose?  Well, it is to use the equity he creates to help his daughter buy her first property.</p>
<p>Then there's my step daughter who rang me today to tell me that whilst planning her thirtieth birthday party she'd also set herself the goal to buy her fourth investment property by the time she turns thirty. Her birthday is in May 2016 and my heart sang as she described the type of property she's looking for.  Go girl, you have the 'can do' attitude.</p>
<p>This goes out to a dynamic young couple who called my just a week ago and who were so focussed they made calculated decisions to be able to secure their development site within a week and are now Property Bloom clients. They explained they have their sites set on building their wealth quickly and they've asked me to find their next site soon. Did I mention they also have seven dual occupancy projects underway in Queensland?</p>
<p>This goes out to my little brother who celebrated twenty-five years in the NSW Police Force this week and whom I proudly watched being awarded special things from Commissioner Scipione. His focus and hard work has seen him rise through the ranks, raise a family and build their dream home.</p>
<p>This goes out to the client who was recently turned away from the four big banks, despite being on a $300,000 plus salary because of the ridiculous changes in their serviceability calculators. I referred him to Rams who more than welcomed his business and gladly offered him the finance he wanted for his development project with Property Bloom.</p>
<p>This goes out to my project manager who after approaching many lenders has used creative strategies to source finance for her first development project.  She has drive and determination which comes from her desire to become financially independent.</p>
<p>This goes out to my builder and the amazing staff who always use the 'can do' attitude which means we'll be completing many of our development projects before Santa arrives this year.</p>
<p>Finally, this goes out to all of you reading this who refuse to let life's ups and downs stop you from driving forward with your goals and dreams. You all have the 'can do' spirit. As the famous Walt Disney said "If you can dream it, you can do it." </p>
<p> </p>
<p><em>Jo Chivers is chief executive officer of property development project managers <a href="https://www.propertybloom.com.au/about" target="_blank">Property Bloom</a>.</em></p>
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jochivers-wq5Bp59R5a

Keeping a can-do attitude in the property game: Jo Chivers

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<p><span>Property has always been a hot investment for Australians, even when staying abroad.</span></p>
<p>Australia’s population is growing around 2% a year, driven by immigration. But 65% of the population live in one of the eight state or territory capital cities, meaning supply is almost always struggling to catch up with demand, according to Richard Wakelin from Wakelin Property Advisory.</p>
<p><span style="line-height: 1.3em;">Hence, investing in property is an attractive option.</span></p>
<p><span>But for those overseas trying to channel their hard-earned money here for investment and handy returns, be wary of property spruikers.</span></p>
<p><span>Regulators have voiced concerns about the price rises in Sydney and Melbourne in particular, amid reports of property spruikers "trapping" ill-advised investors in self-managed super fund (SMSF) structures.</span></p>
<p><span>In December 2014, the Financial System Inquiry chaired by David Murray suggested banning SMSFs borrowing to buy property, by removing the current exemption for limited recourse borrowing arrangements (LRBAs).</span></p>
<p><span>"We regard [recommendations to buy property through SMSFs] as investment advice and you need to be licensed and if you are not licensed we will come after you," ASIC commissioner Greg Tanzer told Property Observer earlier this year. </span></p>
<p><span>Be cautious while buying off-the-plan property. You might save on stamp duty, but this is usually offset by the GST you indirectly pay, as a developer pays 10% GST on the building costs component which will be passed on to the buyer in the purchase price.</span></p>
<p><span>Also, as you will invariably pay a premium for the new house, you could end up losing up to 20% value if you skipped proper research.</span></p>
<p><span>High-rises can sometimes prove to be a trap as there is a supply glut in some suburbs. Which means finding tenants is hard, besides the level of rent and the yield.</span></p>
<p><span>Buildings with lifts, communal gymnasiums and pools usually come at the cost of higher fees.</span></p>
<p><span>Also, avoid properties that banks may be reluctant to lend for. These could include serviced apartments, student accommodation and those in a mixed zoning. </span></p>
<p><span>If it's not good enough for the bank, meaning 'risky', it's likely not good enough for you, says Wakelin.</span></p>
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j.ballantyne1990-6AQqhLzZaK

Expats, avoid these common pitfalls before investing in property

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<div>Excluding property loans, low interest rates are not really stimulating commercial finance any longer.</div>
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<div>In fact the ABS Lending Finance figures showed total commercial finance declining moderately once again in August. </div>
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<div>In trend terms commercial finance has now been on the slide since May 2015. Yuck!</div>
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<div><a href="/images/2016/10/18/A3.jpg" target="_blank">Click to enlarge</a></div>
<br><div class="separator"><img src="/images/2016/10/18/A3.jpg" alt=""></div>
<br><div>As a result total lending finance is also about 9 percent lower than it was in Q3 2015, even after accounting for a rebound in property investor loans over the past seven months. </div>
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<div><a href="/images/2016/10/18/A4.jpg" target="_blank">Click to enlarge</a></div>
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<br><div><strong><span style="text-decoration: underline;">Sydney investors return with a vengeance</span></strong></div>
<div> </div>
<div>I've been noting for a little while that property investor loans have been quietly creeping back in Australian month-on-month - and in New South Wales in particular - and now the cat is really getting out of the bag again. </div>
<div> </div>
<div>Here are the raw original figures for NSW investor loans in calendar year 2016, not seasonally adjusted:</div>
<div> </div>
<div>January $3.1 billion</div>
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<div>February $3.9 billion</div>
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<div>March $4.5 billion</div>
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<div>April $4.5 billion </div>
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<div>May $5.3 billion</div>
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<div>June $5.8 billion</div>
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<div>July $5.2 billion</div>
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<div>August $5.5 billion</div>
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<div>Remember these figures aren't seasonally adjusted, so the original or 'like-for-like' figures over the past few years look like this:</div>
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<div>August 2012 $2.7 billion</div>
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<div>August 2013 $3.5 billion</div>
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<div>August 2014 $4.6 billion</div>
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<div>August 2015 $5.0 billion</div>
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<div>August 2016 $5.5 billion</div>
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<div>The equivalent figure during the financial crisis nadir in August 2008 was just $1.7 billion.<br><br>Ex-refinancing, investors in NSW are now accounting for nearly 50 per cent of loans again.<br><br>No other state comes remotely close to that, even Victoria.<br><br>Following last year's macroprudential intervention, the value of property investor loans is now higher than a year ago in New South Wales, Victoria, Queensland, and South Australia, and activity looks to be rising again.<br><br>This means that as weaker results start to drop off, when plotted in rolling annual terms, the investor loans chart should be starting to turn up again.<br><br>And, so it is...</div>
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<div><a href="/images/2016/10/18/A1.jpg" target="_blank">Click to enlarge</a></div>
<br><img src="/images/2016/10/18/A1.jpg" alt=""><br><div> </div>
<div>Even Darwin investor loans now seem to have found a base (as do those in Western Australia) - something I didn't think I'd find myself saying in 2016 - with vacancy rates in the Northern Territory capital apparently now declining again. </div>
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<strong><span style="text-decoration: underline;">The wrap</span></strong><br><br>The increases may look to be moderate to date in rolling annual terms,.<br><br>But overall stock levels are well down on last year, hence the pressure on auction clearance rates in inner-suburban areas.<br><br>Sydney recorded a preliminary auction clearance rate of 80 percent today, with the median auction price running as high as $1,222,500.<br><br>It's another leg up.</div>
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<p><span><em>PETE WARGENT is the co-founder of <a href="https://allenwargent.com/" target="_blank" rel="nofollow">AllenWargent</a> property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank" rel="nofollow">blogger</a>.</em><br></span></p>
<p><em>His latest book is <a href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx" target="_blank" rel="nofollow">Four Green Houses and a Red Hotel</a>.</em></p>
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pwargent-M4siyDbqQY

Sydney property investors come storming back

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<p>The latest housing data from the Australian Bureau of Statistics (ABS) shows that while lending to owner occupiers is fairly flat, demand from the investor segment has continued to stall. </p>
<p>When you dig deeper, the data shows that owner occupier demand is growing for new lending as refinancing stalls.</p>
<p>The April 2017 housing finance data indicated over the month there was $32.5 billion worth of commitments which was -1.6% lower than the $33.0 billion in commitments in March.  Relative to April 2016, the value of housing finance commitments was 3.6% higher in April of this year.</p>
<p><a href="https://www.propertyobserver.com.au/images/2017/06/09/chart-1-1.jpg" target="_blank">Click to enlarge</a></p>
<p><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/2017/06/09/chart-1-1.jpg" alt=""></p>
<p>Over the month of April 2017 there was $19.9 billion worth of housing finance commitments to owner occupiers which was actually the lowest value of lending to owner occupiers since November 2016.  There was a further $12.6 billion in finance commitments to investors which was the lowest value of lending to this cohort since September 2016.  Remember that the cooling of investor lending has largely occurred before the recent changes to investor lending policies have come into effect.  Investors have though been feeling the impact of greater interest rates increases than those implemented for owner occupiers.</p>
<p><a href="https://www.propertyobserver.com.au/images/2017/06/09/chart-2-1.jpg" target="_blank">Click to enlarge</a></p>
<p><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/2017/06/09/chart-2-1.jpg" alt=""></p>
<p>The $19.9 billion in owner occupier housing finance commitments in April 2017 consisted of $1.9 billion for the construction of dwellings, $1.1 billion for purchase of new dwellings, $5.8 billion for refinancing of established dwellings and $11.1 billion for purchase of established dwellings.  The above chart highlights how the value of lending for purchase of established housing stock is continuing to lift while refinancing has continued to slow.  In fact, the value of lending for the purchase of established housing was at its highest level since November 2015 while the value of refinances for established dwellings was at its lowest level since May 2015.  The value of housing finance commitments for refinancing of established dwellings is now -20.9% lower than it was at its December 2015 peak.</p>
<p><a href="https://www.propertyobserver.com.au/images/2017/06/09/chart-3.jpg" target="_blank">Click to enlarge</a></p>
<p><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/2017/06/09/chart-3.jpg" alt=""></p>
<p>Investors committed to $12.6 billion in housing finance commitments over the month consisting of $1.1 billion for the construction of dwellings and $11.4 billion for established housing.  Investor housing demand is slowing, due to a pull-back in demand for established investment properties.</p>
<p><a href="https://www.propertyobserver.com.au/images/2017/06/09/chart-4.jpg" target="_blank">Click to enlarge</a></p>
<p><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/2017/06/09/chart-4.jpg" alt=""></p>
<p>Looking at lending across the states and territories the thing that is immediately noticeable is how overweight investment lending is in New South Wales and to a lesser degree in Victoria.  In fact New South Wales is the only state in which new lending to owner occupiers is lower in value than lending to investors.  The state level data is not seasonally adjusted and given the large volume of public holidays in April the data is generally weaker than data from March, nevertheless when we look at the proportion of lending it shows that there is some emerging weakness in investor lending.</p>
<p><a href="https://www.propertyobserver.com.au/images/2017/06/09/chart-5.jpg" target="_blank">Click to enlarge</a></p>
<p><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/2017/06/09/chart-5.jpg" alt=""> </p>
<p>If you strip out refinancing to focus on only new lending, the majority of new lending in New South Wales is to investors while in most other states and territories investors are less than 40% of new lending.  Compared to recent levels the proportion of lending has slowed in New South Wales falling from 57.6% in January 2017 to 55.3% currently, it has also fallen in Victoria from 47.6% of all new lending in September 2016 to 46.8% currently.  The pull-back in lending to investors in the two most populous states which also have the hottest housing markets would be encouraging for banking regulators.  Of course, both of these states are still seeing investor participation which is well above long-term average levels and a further pull-back, which is anticipated, could slow the rate of value appreciation in Sydney and Melbourne.</p>
<p>Overall the data points to further weakness in housing finance demand from investors and from owner occupiers that are refinancing.  The investors slowdown is likely due largely so far to the higher interest rates being pushed to customers, with a crackdown on new interest-only lending yet to come into effect it is reasonable to expect further weakness in investor demand over the coming months.  In terms of refinance, this is potentially slowing because some of the lending policy changes are making it more difficult for people to refinance, particularly if it is with the intention to then take out an investor loan.</p>
<p>If, as expected, the weakness in housing finance demand continues, it is likely to lead to a slowdown in housing demand.  As a result this would likely lead to slower levels of value growth over the coming months, particularly once the tougher lending rules come into effect for interest-only lending.  This is even before considering the potential for additional costs due to the banking levy and the recent credit downgrading of the non-major banks which are likely in some form to be passed on to mortgagees.</p>
<p class="p1"><em><span class="s1">Cameron Kusher is head of research for CoreLogic. You can contact him <a href="https://blog.corelogic.com.au/about/"><span class="s2">here</span></a>.</span></em></p>
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ckusher-ujnxiKuFQs

Investor demand and refinancing by owner occupiers continues to stall in April 2017

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<p>There are two sides to a trade.</p>
<p>If you are buying an investment someone is selling it.</p>
<p>Ask yourself, then, a simple question: why are they selling?</p>
<p>It might be for personal reasons. </p>
<p>They could be selling some shares before financial year end to reduced a tax liability, for example.  </p>
<p>Or it might be for another genuine reason.</p>
<p>In the property markets, vendors often sell an apartment because they want to trade up and move into a house. </p>
<p>Or, maybe, they don't like the investment as much as you think you do, and that's why they selling.  </p>
<p><strong>Group think</strong></p>
<p>Group think can be dangerous.</p>
<p>When everyone is piling into an asset class or certain investment, this may not be a great sign for future returns.</p>
<p>Try to become a contrary thinker.  </p>
<p>This is not necessarily a skill you are born with, but it can certainly become a learned habit over time.</p>
<p>Question everything - not to the point of inaction, or sleepless nights - but don't simply blindly trust widely held beliefs. </p>
<p>Try to think of counter-arguments your investment decision, or list potentially dissenting views. </p>
<p>Think of some worst case scenarios, and what you would do or feel if they played out. </p>
<p><strong>Asymmetric information </strong></p>
<p>Could the seller know more than you?</p>
<p>Real estate is an imperfect market which offers amazing opportunities to buy below market value or add value. </p>
<p>But asymmetric information is a common hurdle that needs to be overcome via thorough market research. </p>
<p>Almost by definition, the vendor of a property tends to know more about the potential problems and challenges than the buyer.</p>
<p>In the share markets insider information is also rife.</p>
<p>People often like to think they know more than the market, but the truth is, they often don't.</p>
<p>Therefore, before you pull the trigger on an investment, think to yourself:</p>
<p>"Why are they selling?"</p>
<p class="p1"><span class="s1">PETE WARGENT is the co-founder of <a href="https://allenwargent.com/" target="_blank"><span class="s2">AllenWargent</span></a> property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank"><span class="s2">blogger</span></a>.</span></p>
<p class="p2"><span class="s3"><em>His latest book is </em><a href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx" target="_blank"><span class="s2"><em>Four Green Houses and a Red Hotel</em></span></a><em>.</em></span></p>
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Why are they selling? Pete Wargent

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<p><span style="line-height: 1.3em;">Getting started on your property investment journey can be daunting. I'm reminded of this when I hear from people who haven't yet been able to take that step forward. </span></p>
<p>It's something that comes naturally to me now after sourcing many properties and development sites for our Property Bloom clients but I can still remember very clearly my first investment property purchase. Man, was I nervous!</p>
<p>Some people seem to be able to make a quick (yet still educated) decision and others 'think' about it for weeks, months and sometimes years. Being decisive is a great skill to have. </p>
<p>I had a call the other day from a lady who said she'd been following my articles on Property Observer for years but couldn't ever get to the point of making a decision on how to buy her first property, where to buy it and how much she should spend. </p>
<p>In this time, she watched the Sydney market rise and rise until it was virtually unviable to her as an investment option. Then she was kicking herself for not getting in earlier.</p>
<p>The one thing I wanted to communicate to her was to "take small steps".  Break down the process so that it doesn't seem so overwhelming. </p>
<p>Start with your finance. How much can you borrow and service and how much do you feel comfortable borrowing? Once you have a budget then you've taken the first step. </p>
<p>With that budget in mind, look for locations with a median price point around the same as your budget. Choose a few different suburbs in this location and then spend time in these suburbs. Drive around, hang out in the shopping centre, study the people who live there. Strike up conversations and ask about what they love about living there... and if  there are any streets they wouldn't live. What are the schools like and are there good community facilities like sporting fields, skate parks, playgrounds, places for families to enjoy. </p>
<p>Once you get a 'feel' for the area and the people living there, then start some more detailed due diligence on the local economy, job opportunities, infrastructure projects, council's long term plans for the area, population growth, recent past sales, rental returns and vacancy rates. Attend auctions and talk to real estate agents about what tenants are looking for.   </p>
<p>There that's the next step taken, and all of a sudden you've become very knowledgeable and narrowed down the suburb where you'll invest.  Follow the sales market in the streets you like and you'll soon know what a good deal looks like. </p>
<p>Remember to look for development potential in a property; can you add value to it either now or in the future?  Search for large block sizes, dual access points, houses you can add a bedroom or upgrade the kitchen or bathroom to increase the rent.  Property located in a medium density zone means you'll have more options later to develop it. Find property that is close to shops, on public transport routes and within a short drive to the central business district or to the closest city.  </p>
<p>Finally, get ready to move quickly. When you find a property that ticks all the boxes and with a finance preapproval under your belt, you can confidently make an offer.</p>
<p>Don't be disappointed if you miss out as all this adds to your experience and there will be other properties that come up soon. By going through this process you'll establish relationships with locals and agents and soon that first small step will lead to an investment property purchase. </p>
<p><em>Jo Chivers is Chief Executive Officer of property development project managers <a href="https://www.propertybloom.com.au/about" target="_blank">Property Bloom</a>.</em></p>
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Small steps will lead to big things: Jo Chivers

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<p>Misinformation is the scourge of real estate consumers.</p>
<p>And too much of it comes from people who present themselves in public as experts providing “analysis” when in reality they’re mis-diagnosing situations and adding to the media pipeline of misinformation.</p>
<p>It’s extraordinary how often economists, mortgage brokers, researchers, valuers, Reserve Bank officials and others do that.</p>
<p>This connects to my comments earlier in the week about the way many commentators arrive at their conclusions: if Event A coincides with Event B, then Event A must have caused Event B.</p>
<p>That’s about as sophisticated as real estate analysis gets for most cases.<span style="line-height: 1.3em;"> </span></p>
<p>Therefore, if low interest rates coincided with Sydney’s boom, then low interest rates are obviously the cause of the Sydney boom. This is accepted as fact by almost everyone out there among the chattering classes with almost-knowledge of real estate.</p>
<p>Question: why have low interest rates not caused equivalent booms in Perth, Canberra, Darwin, Brisbane, Adelaide, Hobart and most of regional Australia?</p>
<p>Many markets have been going backwards, un-stimulated by the level of interest rates.</p>
<p><span style="line-height: 1.3em;">Here are some other things Sydney’s property boom coincided with: the change in state government in 2011, the subsequent massive rise in infrastructure spending and the surge in the NSW economy to No.1 in the nation. Perhaps those events had something to do with it.</span></p>
<p>Here’s another thought. The other city market that’s shown some buoyancy in recent years is Melbourne, though not as much as Sydney. Is it not relevant that Victoria’s economy has been the No.2 in the nation, not as strong as NSW but above the national average? Melbourne also has a fairly big infrastructure spend happening, though not as big as Sydney’s.</p>
<p>The relative performances of the property markets in those cities have mirrored the health of their respective state economies and their outlay on new infrastructure, which generates economic activity, jobs and housing demand.</p>
<p>The issue of the week has been housing finance data and how it has been interpreted by commentators with almost-knowledge of property.</p>
<p>Regulatory authorities have introduced “macro prudential measures” to slow down property investor activity. The latest ABS data on housing finance shows a decline in lending to investors.</p>
<p>There’s only one conclusion a reasonable observer could draw from that, right? Clearly the regulatory measures are working. I mean, duh!</p>
<p>Well, that’s what you would say if you’re a business with a lust for limelight and your vision extends no further than the length of your upturned nose.</p>
<p>And multiple commentators rushed out press releases saying just that, including the ever-hungry RateCity which claimed: “Today's sharp drop in investor housing commitments shows that differential pricing is having a dramatic effect on the housing market.”</p>
<p>There were many others expressing similar views. APRA makes announcement, lenders lift interest rates for investors, investors stop taking out loans – simple, obvious and clear-cut.</p>
<p>Except it’s not.</p>
<p>Investors haven’t stopped staking out loans. They’ve switched the status of their borrowing from investor to home-buyer, thereby accessing cheaper rates and easier terms.</p>
<p>The apparent fall in investor borrowing reflects a trend towards reclassifying loans as owner-occupier. Most commentators have missed that.<span style="line-height: 1.3em;"> </span></p>
<p>“The (APRA) moves are having a dual impact: weakening investor loans but indirectly boosting owner-occupier loans as these become more appealing for both lenders and borrowers that have the option of purchasing as an owner-occupier,” Westpac economist Matthew Hassan says.</p>
<p>And National Australia Bank economist Tapas Strickland says that while there appears to be a decline in investor lending, “caution is warranted”.</p>
<p><span style="line-height: 1.3em;">A dose of caution generally, before commentators rush to shallow analysis in the pursuit of profile, would be welcome.</span></p>
<p><span style="line-height: 1.3em;"> </span></p>
<p><span style="line-height: 1.3em;"><em>Terry Ryder is the founder of <a href="https://www.hotspotting.com.au/" target="_blank">hotspotting.com.au</a>. You can <a href="https://mailto:ryder@hotspotting.com.au" target="_blank">email him</a> or follow him on <a href="https://twitter.com/hotspotting" target="_blank">Twitter.</a></em></span></p>
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terryryder-YECXbqmri2

Investors switching borrowing status: Terry Ryder

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<div>It's the end of financial year!</div>
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<div>It was a really strong finish to the year for share markets today, closing up by 1.8 percent. However, the Aussie stock markets finished the financial year down by an underwhelming 4.1 percent.</div>
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<div>With the tax year now having come to an end, it will soon be time to lodge those tax returns.  </div>
<div> </div>
<div><strong><span style="text-decoration: underline;">Holiday homes under scrutiny this year</span></strong></div>
<div><strong><span style="text-decoration: underline;"> </span></strong></div>
<div>Last year, the Australian Taxation Office (ATO) designed and implemented new compliance strategies for foreign investors in Australian property, including stakeholder engagement (with advisers, agents, and associations), improved data matching, and a broad investigation strategy into illegal foreign purchases.</div>
<div> </div>
<div>This year - as well as those claiming excessive work-related expenses such as travel expenses, self-education, uniform, mobile phone, and internet costs – it is resident Australians with rental properties that are more likely to be under scrutiny from the ATO at tax time - in particular those will holiday homes.</div>
<div> </div>
<div>During the past year ATO Commissioners have advised Farifax Media and SBS News that they have been in contact with thousands of owners of rental properties in order to clarify their entitlements or request clarification about claims that they've made. </div>
<div> </div>
<div>The ATO has further reportedly sent correspondence to some holiday home owners recommending that they "review the nature of their claims" before dropping in their next returns...oops!<br><br>
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<div>With well over 2 million Australians lodging tax returns declaring ownership of a rental property - spread widely across all income brackets – the landlord sector is substantial, and there are potentially significant liabilities to be raised by the ATO.</div>
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<div>Click to enlarge</div>
<div><img src="/images/2016/07/01/ATO1.jpg" alt=""></div>
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<div>Owners of holiday homes should take a good deal of care not to make claims for net rental losses for periods when their property has not actually been made available for rent. </div>
<div> </div>
<div>In particular owners of holiday homes claiming deductions for a full year when the property has been vacant for long periods might expect to get a tap on the shoulder from the tax office.</div>
<div> </div>
<div>According to ATO legislation the principles that apply to a rental property also apply to a holiday home if it is rented out - if you rent out your holiday home, you can claim expenses for the property based on the proportion of the income year it was rented out or was genuinely available for rent.</div>
<div> </div>
<div>However, if a holiday home is advertised in ways that limit its exposure to potential tenants, then the property may not be deemed “genuinely available” for rent – for example, if the property is not widely advertised, or if the advertised rents are set at unrealistically high levels.</div>
<div> </div>
<div>Since the ATO’s interest was flagged some months ago, net rental losses declared or claimed on holiday homes could be lower this year as this loophole is sewn up...</div>
<div> </div>
<div><strong><span style="text-decoration: underline;"><em>Airbnb </em>and online networks</span></strong></div>
<div> </div>
<div>There may also be some confusion relating to the rise of online networks such as <em>Airbnb</em>, with more Australians than ever before choosing to rent out their own homes, or a part of their homes. </div>
<div> </div>
<div>Remember, rental income is assessable and therefore you may have tax to pay at year end - don't try to be sneaky and under-report rental income it or you may be penalised! </div>
<div> </div>
<div>For <em>Airbnb</em> hosts there are two types of allowable deductions. Firstly, there are costs directly associated with generating rental income or with the rental area (for eaxample, photography, commercial cleaning costs, food for tenants, <em>Airbnb</em> fees and commissions, or food made available to tenants). </div>
<div> </div>
<div>And secondly there are costs which may be apportioned, often based upon the applicable floor area, including your mortgage or rent, utilities, internet and phone costs, insurance, and so on.</div>
<div> </div>
<div>Keep records and receipts through the financial year and make sure you set aside some money for the tax liability!</div>
<div> </div>
<div>Also, be aware of the potential legal and liability risks or short term tenancies and other tax implications thereof, such as capital gains tax (the principal place of residence is normally exempt, but generating rental income from the home may trigger a change in this status).  </div>
<div> </div>
<div><strong><span style="text-decoration: underline;">Repairs and maintenance</span></strong></div>
<div><strong><span style="text-decoration: underline;"> </span></strong></div>
<div>There is also often genuine confusion for some property investors over what deductions can be claimed.</div>
<div> </div>
<div>Perhaps the most common mistake made by landlords on lodged tax returns is claiming deductions for repairs and maintenance for expenses which are actually capital costs. </div>
<div> </div>
<div>Property investors are not allowed to claim repairs and maintenance deductions for defects or pre-existing damage that was in evidence at the time they acquired the property. Such improvements are considered to be capital in nature.</div>
<div> </div>
<div>Where investors are unsure they would be well advised to check the rules relating to deductions made available by the ATO for free online, or to engage a tax agent or property specialist tax accountant that is familiar with the rules. </div>
<div> </div>
<div><strong><span style="text-decoration: underline;">Net rental losses declining</span></strong></div>
<div><strong><span style="text-decoration: underline;"> </span></strong></div>
<div>Declared net rental losses have declined sharply in recent times, falling by more than half over the last two tax years for which data is available, largely due to lower interest rates. </div>
<div> </div>
<div>The average net loss claimed by investors has fallen by 64 per cent since 2008 as mortgage repayments have become cheaper. These figures will continue to decline in 2015 and 2016 with interest rates having fallen.</div>
<div> </div>
<div><a href="/images/2016/07/01/NG.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/07/01/NG.jpg" alt=""></div>
<div> </div>
<div>While the ATO will doubtless generally be looking for expenses claimed in error as part of their investigative reviews or audits, it is worth noting that many investors also fail to claim deductions which they are entitled to. </div>
<div> </div>
<div><a href="/images/2016/07/01/NG2.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/07/01/NG2.jpg" alt=""></div>
<div> </div>
<div>In particular, not all owners of rental properties are aware of the potentially generous capital allowances and tax depreciation deductions for plant and equipment which are available under the tax legislation.</div>
<div> </div>
<div>If you are in doubt, a property specialist tax accountant can help you to avoid making costly mistakes!</div>
<div> </div>
<div>
<p><span><em>PETE WARGENT is the co-founder of <a href="https://allenwargent.com/" target="_blank" rel="nofollow">AllenWargent</a> property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank" rel="nofollow">blogger</a>.</em><br></span></p>
<p><em>His latest book is <a href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx" target="_blank" rel="nofollow">Four Green Houses and a Red Hotel</a>.</em></p>
</div>
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