Iwan Sunito's vision for a landmark mixed-use precinct in Sydney's Inner West has taken a major step forward, with approval granted for the $1.9 billion Five Dock development first unveiled earlier this year.

The approved scheme by <a href="https://www.apartments.com.au/developers/one-global-capital">One Global Capital</a> will deliver an 80,500 sqm mixed-use precinct comprising 840 apartments, integrated hotel accommodation, commercial and retail space, alongside publicly accessible open space designed to create a new destination for the growing suburb.

"This is a significant milestone for One Global Capital and for the future of housing delivery in Sydney," Sunito said.

"The Housing Delivery Authority was established to identify major housing projects capable of delivering meaningful supply more efficiently, and we are delighted that Spencer Street has been recognised as one of those projects.”

He said the declaration reflected the rapid progress achieved since acquiring control of the site.

"In less than seven months we have progressed from taking control of the site to securing entry into one of the NSW Government's most important planning pathways. It reflects the experience of our team, the strength of our consultant group led by Urbis, and our long-term commitment to delivering transformational projects that contribute to Sydney's future."

When the project was revealed earlier this year, Sunito described the opportunity as one of the strongest development sites he had worked on.

"I probably hadn't appreciated the uniqueness of the site until more recently when putting together the concept plans," Sunito said.

"The proximity to the water, and the golf course opposite, is unlike any other part of Parramatta Road. We have a unique position and view corridors over the water that makes this one of the best sites I've worked on."

The development has evolved since its initial announcement, with the approved plans increasing the residential component from the originally proposed 750 apartments to 840 homes while retaining the project's focus on creating an integrated neighbourhood rather than a standalone residential development.

Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/a-city-within-a-city-iwan-sunito-flags-1-5-billion-mixed-use-precinct-in-five-dock">"A city within a city": Iwan Sunito flags $1.5 billion mixed-use precinct in Five Dock</a>

The precinct will combine apartments with hotel accommodation, commercial workplaces, retail offerings and public spaces, creating a mixed-use environment intended to serve both residents and the broader Five Dock community. The proposal also continues the collaboration between One Global Capital and internationally recognised architect <a href="https://www.apartments.com.au/architects/koichi-takada-architects">Koichi Takada</a>, whose previous work with Sunito includes Infinity, Arc and Skye North Sydney.

Takada previously said the design was driven by a philosophy of integrating nature into the built environment.

"The concept for this development is born from our design approach to naturalising architecture," Takada said.

"The public realm benefits from biophilic design that integrates generous landscaping, and the development is optimised for natural daylight, airflow and water views to foster wellbeing, sustainability and spaces that foster community interaction."

Sunito has consistently described the project as a "city within a city", with a strong emphasis on creating a destination that extends beyond housing.

"We want to create a development that's not only to be seen, but to be experienced by the whole local community," he said.

The approval comes as Five Dock continues its transformation ahead of the opening of the Sydney Metro West line, with the new Five Dock station set to significantly improve connections between the Inner West, Parramatta and the Sydney CBD.&nbsp;

The precinct will also benefit from its proximity to the Parramatta Road corridor, nearby waterfront parklands and established retail and dining offerings that have made Five Dock one of Sydney's most tightly held Inner West suburbs.

Joel Robinson

Iwan Sunito secures approval for $1.9 billion Five Dock mixed-use precinct

The new <a href="https://www.apartments.com.au/new-apartments/yarraville-green-42-stephen-street-yarraville-vic-3013">Yarraville Green</a> development in Melbourne's inner west is showing that landscaping can be just as influential as architecture, with buyers responding strongly to the garden-first approach adopted from the outset by developer Excelon Projects and the project's design team.

Excelon appointed Six Degrees Architects and landscape architects SBLA to work collaboratively on the development, with a brief to create "a sustainable, design-led building with a focus on community."

That approach has resonated with buyers. According to Next Chapter Director Tom Hirini, who is leading the sales campaign, the landscaped communal garden has become one of the project's defining features, alongside its boutique scale and European-inspired cluster housing concept.

Local downsizers, right-sizers and established families already living in Yarraville and surrounding suburbs have accounted for the majority of purchasers.

[smartcode_project:default project_id=144913 project_image_fid=297740]

Yarraville Green will comprise 53 homes, including apartments and townhomes, arranged around the shared central garden to maximise connections to the landscaped open space. Parking has been moved underground, allowing the ground plane to be dedicated to greenery, pedestrian movement and communal spaces.

The landscape extends well beyond passive planting. Productive garden beds, a pergola, communal gathering spaces, garden sheds and a pet wash have all been integrated into the masterplan, creating spaces designed to encourage everyday interaction between residents.

[smartcode_project:default project_id=144913 project_image_fid=297741]

The interiors continue Excelon's focus on craftsmanship, incorporating bespoke elements by Melbourne artisans including leadlight detailing by Adadaz, hand-turned timber hardware by Auburn Woodturning and blown-glass lighting by Ruth Allen.

Sustainability has also been embedded throughout the project, with Yarraville Green targeting an average 7-star NatHERS energy rating through passive design principles, rooftop solar servicing common areas and rainwater harvesting for landscape irrigation.

[smartcode_project:default project_id=144913 project_image_fid=297735]

Construction continues to progress at Yarraville Green, with structural works well underway and framing works approaching completion under builder Balmain &amp; Co. The project remains on track for completion in mid-2027.

Apartments at Yarraville Green are currently priced from $625,000, while townhomes start from $1.4 million.

[smartcode_project_cta:default project_id=144913]

Garden-led design drives buyer demand at Yarraville Green

National diversified developer Fortis has officially launched Crest &amp; Walker, its latest Brisbane apartment development, with construction now underway on the 20-storey Newstead project.

Award-winning builder BINAH has commenced construction on the Bureau^Proberts-designed building, which will deliver a limited collection of 65 two and three-bedroom apartments on Kyabra Street.

[smartcode_project:default project_id=145922 project_image_fid=373556]

The project marks Fortis' fourth active residential development in Brisbane, following River House, which is nearing completion, alongside projects in New Farm and Hamilton as the national developer continues to expand its South East Queensland pipeline.

Fortis General Manager – Development Queensland Dan Boman said Crest &amp; Walker reflects the developer's long-term commitment to delivering design-led residential projects in Brisbane's established inner-city suburbs.

"We're proud to be strengthening our presence in Brisbane with Crest &amp; Walker, particularly in such a sought-after lifestyle destination as Newstead," Boman said.

"Every Fortis project is shaped by its context, and we approach each one with the respect and care it deserves.

"Our focus is always on creating places that feel connected to their neighbourhood and elevate the everyday experience for residents. Newstead continues to evolve as one of Brisbane's most sought-after urban communities, and Crest &amp; Walker reflects our ambition to contribute meaningfully to that story."

[smartcode_project:default project_id=145922 project_image_fid=373559]

Positioned between Gasworks Plaza and James Street, <a href="https://www.apartments.com.au/new-apartments/crest-walker-newstead-12-kyabra-street-newstead-qld-4006">Crest &amp; Walker</a> has been designed as a boutique residential address offering privacy and generous living spaces within one of Brisbane's most established lifestyle precincts.

The building features a contemporary brick podium softened by integrated landscaping, while the upper levels are characterised by restrained architecture and enduring materiality. Interiors have been designed to maximise natural light, acoustic performance and long-term liveability.

[smartcode_project:default project_id=145922 project_image_fid=373583]

Residences comprise spacious two and three-bedroom floorplans, with two-bedroom apartments priced from $1.55 million and three-bedroom, half-floor residences from $3.95 million.

Residents will have access to a wellness-focused rooftop featuring a swimming pool, sauna, steam room, landscaped dining spaces and outdoor lounge areas overlooking Newstead and the Brisbane CBD.

[smartcode_project:default project_id=145922 project_image_fid=373571]

Sales are being managed by Slaite Projects, with Fortis expecting strong demand from owner-occupiers seeking a high-quality, design-focused apartment in one of Brisbane's most tightly held inner-city suburbs.

Completion of Crest &amp; Walker is slated for late 2028.

[smartcode_project_cta:default project_id=145922]

Fortis expands Brisbane pipeline with launch of Crest & Walker in Newstead

The enormity of delivering a true skyscraper in Australia's new development market is often overlooked.

It has taken the best part of a decade since plans for Chevron One were first unveiled, but the 41-storey tower is now complete, with residents collecting their keys and moving into what has become one of the Gold Coast's most recognisable new landmarks.

Rising 127 metres above Chevron Island, Chevron One stands almost twice as high as any other building on the island. Its scale places it alongside the trio of towers at Jewel, arguably the last truly significant addition to the central Gold Coast skyline when they were completed around six years ago.

While there are several developments underway around a similar height to Chevron One, they are more concentrated within clusters of the highest towers in the city. The fact Chevron One sits within a developing precinct, looking back at the other high-rise developments in Surfers Paradise and Broadbeach, makes it a different proposition altogether. It will certainly become a reference point on the Gold Coast skyline.

[smartcode_project:default project_id=6515 project_image_fid=68833]

Developer Bensons Property Group is behind the 41-storey tower, which has 229 apartments, along with an exhaustive list of resident amenity spread across what is the largest development site ever assembled on Chevron Island.

The tower has been the talk of the town for years, says Ray White Projects Gold Coast agent Caitlin Rosenboom, who is selling the remaining apartments.

"People have been watching Chevron One go up for years," Rosenboom says, adding that many prospective buyers have been surprised by the scale of the views once they step inside.

"It's only when they walk through a completed apartment that they truly understand the position of the building," Rosenboom says.

"The views are jaw-dropping. Whether you're looking east over the ocean, across Surfers Paradise, along the river systems or out to the hinterland, every level offers something different but equally impressive."

[smartcode_project:default project_id=6515 project_image_fid=360215]

One of Chevron One's defining advantages is its location on the eastern side of Chevron Island on Stanhill Drive, a position which protects the views forever.

"There's only one row of houses between Chevron One and the water, and the height restrictions along the river means views from Chevron One can never be built out,"&nbsp;Rosenboom says.

While new apartment developments continue to emerge across the Gold Coast, Rosenboom says opportunities to secure a completed apartment with this level of outlook are becoming increasingly rare.

"The size of the site is something that would be incredibly difficult to replicate today," she says.

"That's allowed Chevron One to deliver the sort of amenity, open space and resident facilities that very few projects can offer. There are not many completed apartment buildings on the Gold Coast right now that can compete with the combination of scale, quality and amenity."

[smartcode_project:default project_id=6515 project_image_fid=68839]

There's around 2,000 sqm of amenity solely for the use of residents of Chevron One. Club One features a uniquely shaped swimming pool that mirrors the footprint of the building itself, set within a extensively landscaped gardens. There's also an indoor pool and spa, a fully equipped gym with a Pilates room, a yoga garden, a bookable private dining area and lounge that can host up to 30 people, and a 24-hour concierge service.

As for the buyers, Rosenboom is fielding enquiry from everywhere: Sydneysiders and Melburnians looking at the new and off-the-plan market following the changes in the Federal Budget, as well as those looking to relocate, through to South East Queenslanders seeking either a permanent home or a weekender bolthole.

"The Gold Coast lifestyle continues to resonate with people relocating from the southern states, and when they see the views and the quality of what's been delivered at Chevron One, it becomes very easy for them to understand the appeal," Rosenboom says.

A diverse mix of one, two and three-bedroom apartments remain available, with each offering "something a little different", be it the orientation and views, configuration, or level, to suit a wide variety of buyers.

The remaining apartments are ready to inspect in person, by appointment.

[smartcode_project_cta:default project_id=6515]

A decade in the making: Residents to move into Chevron One as construction wraps up

A general rule of thumb in new apartment developments is that the penthouses get the rooftop.

It's a formula that's become commonplace across Australia's apartment market. Residents might have access to a pool, gym or barbecue facilities on a dedicated lower level, but the most desirable outdoor spaces are typically reserved for the highest-priced homes at the top of the building.

<a href="https://www.apartments.com.au/developers/sherpa-property-group">Sherpa Property Group</a> has taken the opposite approach.

Rather than dedicating the rooftop to a handful of buyers, the Gold Coast developer has made it the centrepiece of its Flourish collection, creating expansive shared spaces from the best vantage point in the building.

The philosophy has reached its most ambitious expression at <a href="https://www.apartments.com.au/new-apartments/flourish-soleira-palm-beach-1150-1160-gold-coast-highway-palm-beach-qld-4221">Flourish Soleira</a> in Palm Beach, where two rooftop precincts connected by a skybridge will deliver one of the most extensive lifestyle offerings seen in a residential apartment project on the Gold Coast.

[smartcode_project:default project_id=150017 project_image_fid=374053]

"We're seeing a clear move toward developments that offer more than just an apartment," Sherpa Group founder Christie Leet said.

"People want spaces that support how they actually live, whether that's working from home, staying active, or spending time with family and friends.

"That's where amenity becomes critical. It's not just about what's included, but how those spaces are designed to be used every day."

[smartcode_project:default project_id=150017 project_image_fid=374052]

The breadth of amenity has already attracted buyers across multiple demographics. Younger first home buyers have been drawn to Soleira's one-bedroom apartments, a product rarely delivered in Palm Beach, while families have responded to practical inclusions such as the shallow children's pool adjoining the main lap pool and the extensive communal recreation areas.

Instead of a single rooftop, Soleira delivers two distinct lifestyle zones.

[smartcode_project:default project_id=150017 project_image_fid=372547]

The southern rooftop has been dedicated to wellness, featuring a gym, yoga and Pilates studio, work-from-home facilities, a wellness centre, spa, and hot and cold plunge pools.

The northern rooftop focuses on recreation and entertaining, incorporating a heated resort-style pool, private dining rooms, pizza ovens, barbecues, a golf simulator, children's recreation areas, and what is expected to be the Gold Coast's first rooftop basketball court, which will also double as a squash court.

[smartcode_project:default project_id=150017 project_image_fid=374054]

Beyond the rooftops, Soleira will introduce 1,500 sqm of curated retail beneath the towers, creating one of Palm Beach's first genuinely mixed-use lifestyle precincts where cafés, restaurants and convenience retail become part of residents' everyday lives.

Sherpa has also retained management rights across the development, allowing it to oversee the long-term operation of the building through a 24-hour concierge model. The developer is also exploring additional revenue streams within the precinct aimed at helping offset ongoing body corporate costs for residents.

[smartcode_project:default project_id=150017 project_image_fid=370962]

While Soleira is the largest project Sherpa has delivered, the rooftop-first philosophy has been evolving for several years.

It began with <a href="https://www.apartments.com.au/new-apartments/amargo-6-12-sixth-avenue-palm-beach-qld-4221">Flourish Amargo</a>, the first project released under the Flourish brand. Rather than competing at the ultra-luxury end of the market with oversized half-floor and full-floor residences, Sherpa focused on creating lifestyle-driven apartments supported by resort-style shared spaces.

Amargo introduced more than 800 sqm of rooftop amenity, combining wellness facilities, heated pools, entertaining areas, cabanas, pizza ovens and private dining spaces into what was designed as an extension of residents' homes rather than a facility used only occasionally.

[smartcode_project:default project_id=146527 project_image_fid=366550]

That approach continued with Flourish Oasis, where the same amenity-led philosophy was refined into a more boutique development. Strong demand from Sherpa's growing VIP database saw much of the project sold before it reached the broader market, reinforcing buyer appetite for apartment communities centred around shared lifestyle experiences.

Flourish Amargo is slated for completion mid-way-through next year, with Oasis to be delivered by late 2027. Flourish Soleira is expected to complete in 2030.

[smartcode_project_cta:default project_id=150017]

Sherpa takes amenity to the sky as Flourish Soleira captures booming Palm Beach demand

Boom

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SQM's top 10 discounted properties have four located in Western Australia, and these four properties are clear examples of the continued impact of the commodities downturn.
Set in the rural town of Carabooda, number five and six on the list are not your typical family homes.
Sitting 48km outside of Perth CBD, both properties are set on over 15 hectares, with the potential to live and earn a living of the land.
Interestingly, both properties have been on the market for the same amount of time, however, number five, 292 Carabooda Road, as been reduced by two more percentage points, a total saving of $618,000. 
In contrast to these rural beauties, number eight and nine on our list are suitable for buyers wanting to be pampered and live in and close to Perth City.
Number eight, 4/134 Marine Parade, Cottesloe, has been on the market over two years now with the vendor slashing the price by $950,000.
With a reduction of just under a million dollars, this property is clearly a bargain.
Comparatively, number ten on our list 11/580 Hay Street, Perth, has recently passed the one year mark on the market, with the vendor slashing the price by half a million dollars.
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<img src="/images/2015/06/17/sqmfallback2.jpg" alt="">
 Loius Christopher is an indépendant property analyst for SQM. You can follow him on twitter <a href="https://twitter.com/louichristopher" target="_blank">here</a>.
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louischristopher-TWpYcZDLBK

Mining boom downturn triggers four WA offerings on SQM top discounted list 

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It was four months ago - the WA mining town auction that shocked the nation.
The ABC reported on a Port Hedland February auction where the fibro cottage was passed in at auction for $360,000 unsold - its highest offer reflecting 2006 price levels.
Immediately after the auction came its declared $600,000 asking price, then $590,000 in March.
It had last traded four years ago for $1.3 million, and before that at $870,000 in 2009 and at $350,000 nine years ago in 2006. 
<a href="https://www.janfordrealestate.com.au/1928630/" target="_blank">It is now for sale at $470,000</a> after yet another price adjustment. 
The three bedroom, one bathroom 1960s house sits in the heart of the Western Australian mining town. It is within the business and commercial district, opposite developments and not far from the boat ramp, Marapikarrinya Park, and fishing wharf.
<img src="/images/2015/06/17/700_headland.jpg" alt="">
Real estate agent Barry Walsh at Jan Ford Real Estate told the ABC the top bid was a sign the mining boom's construction phase had tapered off.
Negotiations continue for the sale of the cottage with 145 square space on its 600 square metre block.
It was initially listed for private treaty sale in June 2013 at $1.42 million.
Property Observer understands its most recent rental asking price was $800 a week in mid-2014, having been in excess of $2000 a week in 2008 and 2011, when it was last sold.
ABC reported that the <a href="/expert-insights/buying/sydneys-weekend-auction-clearance-rate-soars-to-82-but-port-hedland-highlights-how-the-mighty-can-fall">fibro cottage passed in at auction at $360,000</a>, with the highest offer reflecting 2006 price levels.
In February the listing agent, Barry Walsh at Jan Ford Real Estate, told Property Observer that at the peak of the mining boom, property prices in the Port Hedland and South Hedland regions were unsustainable.
"It was totally unsustainable where it was, and now that it's stabilising, it will bottom out, and is in the throes of doing that," says Walsh. He says 18 Edgar Street was advertised to rent at $2,400 per week at the market's peak," said Walsh.
"And now, you wouldn't rent it for $500 per week. That's a reflection of the rental market."
According to Walsh, the market was now in the process of returning to its fundamental value.
"The stabilisation of the market is a very good thing for Port/South Hedland and the Pilbura region," he says.
"It was unfortunate that the market went where it did, to unsustainable and disproportionate price levels."
He attributes some of the price escalation to the inability to release a sufficient amount of land for development to cope with the influx of residents who were attracted to the area's mining economy. The infrastructure required to house the expected 30,000 to 50,000 residents – everything from hospitals and schools to sewers and roads – wasn't available to facilitate the expansion of the region, making tenants compete for the existing properties.
"The rents got to about $2,800 a week – some of the dearest in the world."
He says 18 Edgar Street is currently advertised for $600,000 through private treaty, with a couple of potential buyers engaged. He says the property, as it exists now, would only be worth around $250,000 to investors as a residential building.
"Everyone up here would want at least 10% gross return", Walsh explained.
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jchancellor-FAypfDUnLy

Port Hedland auction shocker - still unsold four months on

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GUEST OBSERVER
The RBA continues to face a tricky balancing act. Low interest rates are needed to continue to support the rebalancing of growth, as mining investment continues to fall. But, interest rates have now been low for quite some time and they are starting to drive potential asset price bubbles in some parts of the economy.
The key problem relates to the fact that the RBA's cash rate is, and always has been, a blunt instrument. Low interest rates are having their strongest effect on housing prices, which is flowing through to a residential construction boom and a pick-up in durable goods sales. However, the transmission of this effect to business investment and hiring – which is what the central bank would really like to see – has, so far, been weak.
Housing prices are also rising unevenly across the country. Sydney prices are up 39% in the past three years, while prices are 22% higher in Melbourne and only 10% higher elsewhere. More even housing price growth would be preferred. Although the trends in Sydney and Melbourne are what should be expected, given that these cities have the least exposure to the mining sector, at the same time, this is how 'bubbles' can form. What looks like a strong growth story, based on fundamentals (think: the IT bubble of the early 2000s), sees rising investor interest and, at some point, prices rise ahead of fundamentals. The market gets exuberant, as investors begin to believe that prices can only go up. 
The Sydney housing market is showing some of these more worrisome traits and has been for some time now (see '<a href="https://www.research.hsbc.com/midas/Res/RDV?p=pdf&amp;key=kCWWcrdPsN&amp;n=446843.PDF" target="_blank">Downunder digest: Australia's housing boom may get bubbly</a>', 10 February 2015). Investors continue to dominate the Sydney market, prices are rising at 15% y-o-y and auction clearance rates are around record highs.
To try to deal with this issue, the authorities have been tightening prudential settings (to sharpen the instrument). Concerns about the housing market are also likely to have been a key reason why the RBA has been reluctant to have an explicit 'easing bias', despite below-trend growth and the central bank's desire to see the AUD fall further.
No national bubble, but Sydney's exuberance is worrisome 
A housing boom is a part of the plan to rebalance Australia's growth as mining investment falls. When the mining boom was at its height, back in 2011 and 2012, the housing market was being held back by high interest rates which helped to make way for the mining boom without excessive inflation. Then, to stimulate activity in the non-mining sectors, the RBA cut its cash rate from a peak of 4.75% in 2011 to its current record low of 2.00%. As a result, house prices have risen by 24% in the past three years (Chart 1).
At this pace, housing prices have significantly outpaced household disposable income growth. But, from a national perspective these gains do not appear excessive. Indeed, the housing-price to income ratio is only now just reaching its previous peak levels (Chart 2).
<a href="/images/2015/06/10/hsbc1.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2015/06/10/hsbc1.jpg" alt="" width="710" height="328">
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However, the national story hides some more worrisome regional trends. Sydney housing prices have risen by 39% over the past three years, much faster than the other cities (Chart 3). Housing prices are also still rising in Sydney at a 15% y-o-y rate. Although comprehensive state-level income statistics are not available on a time-series basis, it is likely that the Sydney housing price gains are outstripping income growth. Sydney housing price gains are running well ahead of national household disposable income growth (Chart 4).
<a href="/images/2015/06/10/hsbc2.jpg" target="_blank">Click to enlarge</a>
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<img src="/images/2015/06/10/hsbc2.jpg" alt="" width="649" height="302">
Local investors and foreign demand driving the market 
As is part of the plan, the main driver of Australia's housing price boom continues to be low interest rates. As a result of low interest rates, housing loan approvals have risen by 67% since their trough in mid-2011 and are currently rising at a 14% y-o-y rate (Chart 5). It is also clear that the main driver of the ramp up in housing prices continues to be investors, rather than first home buyers or repeat purchasers for owner- occupation (Chart 6). This is more unexpected. Investor loan approvals have risen by 112% since their trough in 2011, while loans to repeat buyers are up 47% and first home buyer loan approvals have only risen by 13%.
<a href="/images/2015/06/10/hsbc3.jpg" target="_blank">Click to enlarge</a>
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Again, there are significant divergences in the trends across the states. The New South Wales (NSW) market, which is mostly Sydney, is being largely driven by investors (Chart 7). The investor share of new housing loan approvals in NSW has remained around record levels for the past six months or so. 
Although investors in Australia's housing market tend to be lower risk borrowers, increased investor interest can provide a tell-tale sign that the market is overly exuberant. In Australia, investors tend to have lower loan-to-valuation ratios than owner-occupiers, to be older households with equity in an owner-occupied dwelling and have higher incomes than first home buyers. This tends to make them a safer risk for lenders. However, investors are also typically involved in the housing market on the expectation of capital gains. A high level of investor involvement is therefore a signal of a growing speculative dynamic that may be worrisome. If this begins to feed on itself, with expectations of capital gains starting to drive further capital gains, a bubble could form.
The other driver of the Sydney and Melbourne housing markets has been significant foreign investor interest, particularly in the apartment markets. Again, estimates of foreign investment flows are imprecise. This largely reflects that it is difficult to define a 'foreigner' in Australia's context. Keep in mind that 28% of Australia's population was born in another country, that there are 200k new migrants each year and around 500k foreign students in the country at any point in time. 
Nonetheless, there are some data available from the Foreign Investment Review Board (FIRB), as genuine foreigners require FIRB approval for real estate purchases. The FIRB report that approvals for foreign investment in real estate rose from 12,025 in FY2012/13 to 23,428 in FY2013/14. Although this a significant rise (95%), it still only leaves measured foreign approvals comprising around 5% of all dwellings turned over in that year. It remains that case that interest rates and local buyers are the dominant drivers of the housing market. 
However, the recent fall in the AUD, could mean that foreign interest in the housing market continues to rise. There is some evidence that a potential driver of increased foreign interest in Australia's housing market has been the recent depreciation of the AUD, particularly against the RMB (Chart 8). Further falls in the currency could continue to support this growing foreign interest.
<a href="/images/2015/06/10/hsbc4.jpg" target="_blank">Click to enlarge</a>
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Authorities are sharpening the prudential tool 
As the RBA's cash rate setting is a blunt instrument, further fine-tuning is largely being left to the prudential regulator. Indeed, the RBA appears to be increasingly focused on managing the real economy, leaving the role of managing the financial cycle to the prudential regulator (as we discussed in detail here: <a href="https://www.research.hsbc.com/midas/Res/RDV?p=pdf&amp;key=j8qW80utUE&amp;n=462148.PDF" target="_blank">Downunder Digest: Australia's evolving approach to macropru'</a>, 20 May 2015).
The Australian Prudential Regulatory Authority (APRA) already requires that all new mortgages pass a serviceability test at an interest rate of 7.00% and that lenders should not grow their investor housing lending at a faster rate than 10% a year, or they could face closer scrutiny if they do. In a recent speech, the Chairman of the APRA, Wayne Byrnes, made it clear that the prudential regulator had been turning up the dial further on its regulatory settings. As a result, most of the major banks have reduced discounts on lending rates to housing investors over the past month. 
It also seems likely that concerns about the housing market have been a key reason why the RBA has been reluctant to have an explicit 'easing bias', despite below-trend growth and the central bank's desire to see the AUD fall further. 
<a href="/images/2015/06/10/hsbc5.jpg" target="_blank"> Click to enlarge</a>
<img src="/images/2015/06/10/hsbc5.jpg" alt="" width="724" height="851">
<a href="https://www.about.hsbc.com.au/hsbc-in-australia/management-team" target="_blank">PAUL BLOXHAM</a> IS CHIEF ECONOMIST (AUSTRALIA AND NEW ZEALAND) FOR HSBC. 
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Sydney's housing boom or bubble? HSBC's Paul Bloxham's worrisome conclusion

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John Symond, the founder and chairman of Aussie Home Loans, believes the Sydney residential market was peaking.
"She's topped out," he suggests.
"I really can see, I am feeling it already..that the market is just starting to come off the boil," he told Ross Greenwood on the 2GB Money News program tonight.
"By Christmas I reckon instead of going up in the hot areas by 15%, I reckon it will be like half of that."
"Into next year, I think they'll (prices growth) will settle right down to four or five percent. It will be a more healthy market, than the fears that are around at the moment.
"Ross I have been telling friends of mine… who ask me that question all the time … and I reckon that the prices are so high at the moment, my suggestion is wait six to 12 months the chances are, all going well, there will be opportunities out there that you will probably buy better in some areas than what you can buy today."
 
 
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Patience John Symond advises Sydney first home buyers: the market is coming off the boil

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GUEST OBSERVER
Australia’s apartment boom is in full swing. Nationally, 40% of new dwellings are now apartments or units, and building approvals outnumber those for houses. Melbourne and Brisbane are the most extreme cases, but these trends are national; and they are fundamentally reshaping the future of urban Australia.
In Melbourne, for example, the inner city is being flooded with 1-2 bedroom micro-apartments set in increasingly tall towers (+30 storeys). Almost half are under 50 square metres - not much bigger than a generous double garage. These would be outlawed in other world cities, including Sydney. The Property Council of Australia and much of the industry acknowledges the problem. Victorian Planning Minister Richard Wynne has now released a <a href="https://delwp.vic.gov.au/planning/policy-and-strategy/better-apartments" target="_blank">discussion paper</a>, and there is a plan for new guidelines next year. 
<img src="/images/2015/05/26/Horne1.png" alt="">
The differences between a small one bedroom 42 m2 apartment and a standard one bedroom 50 m2 apartment. RIBA Homewise – The Case for Space: The size of England’s new homes. Included in Future Living, City of Melbourne, 2013.
The market is not delivering what families need, and as a result, future liveability in Australian cities is in jeopardy. Much of the commentary is about size and density. An urgent discussion is also needed about quality and the market.
Reports of “vertical slums” are not entirely unwarranted. Apartments can be great homes – why are ours so mismatched with families and affordability concerns? For working families in the city who need access to services and work, there are few affordable alternatives.
<h2>Quality vacuum – a race to the bottom</h2>
Many new apartments have bedrooms with no windows, low ceilings and inadequate storage. They have poor access to natural light and ventilation, and underperform on environmental efficiency. Internal amenity of apartments is <a href="https://www.melbourne.vic.gov.au/BuildingandPlanning/FutureGrowth/Documents/future_living_discussion_paper.pdf" target="_blank">comparatively under-regulated</a>. Apartment bedrooms without windows, for instance, are illegal in New York, Hong Kong and Vancouver.
<img src="/images/2015/05/26/Horne2.png" alt="">
An example of the features included in a ‘poor’ housing development. <a class="source" href="https://www.melbourne.vic.gov.au/BuildingandPlanning/FutureGrowth/Documents/future_living_discussion_paper.pdf" target="_blank">Future Living, City of Melbourne 2013</a>
Current regulation is failing families and future Australians. Building Code of Australia (BCA) and National Construction Code (NCC) requirements, borne out of original concerns with safety, are seemingly inadequate to the delicate task of ensuring quality while enabling innovation. Even the Guidelines for Higher Density Development (<a href="https://www.dtpli.vic.gov.au/planning/urban-design-and-development/urban-design-guidelines/higher-density-residential-development" target="_blank">DPCD 2004</a>) fail to provide specific and measurable outcomes, with high-level objectives that are evidently easily bypassed in practice. 
<img src="/images/2015/05/26/horne3.jpg" alt=""> 
<h2>Marketing airspace - unconstrained towers</h2>
A <a href="https://www.churchilltrust.com.au/media/fellows/Hodyl_L_2014_Social_outcomes_in_hyper-dense_high-rise_residential_environments_1.pdf" target="_blank">recent report</a> unfavourably compares Melbourne’s high-rise rules to those of world cities. Developers in Melbourne can build at four times the densities allowed in New York, Tokyo or Hong Kong. Moreover, inner city developers are generally under <a href="https://www.melbourne.vic.gov.au/BuildingandPlanning/FutureGrowth/Documents/Homes_for_People_Housing_Strategy_2014-2018.pdf" target="_blank">no obligation to contribute</a> to essential public infrastructure, such as affordable housing and community facilities, through density bonus systems. The findings are nothing short of damning, not least for a city that prizes itself, year on year, as the “world’s most liveable city”.
Market-driven urban development “logic” is rarely questioned, but there’s evidence of wholesale market failure. Much of our high density, high-rise apartment stock caters to the local and overseas investor market, enticed by favourable taxation and regulatory regimes. Putting aside concerns about the potential impact of tightening regulations on foreign property investments, many new apartments seem basically <a href="https://www.melbourne.vic.gov.au/BuildingandPlanning/FutureGrowth/Documents/Homes_for_People_Housing_Strategy_2014-2018.pdf" target="_blank">unaligned to households’ and families’ changing needs</a>.
Two priorities emerge: for reform, and for understanding changing housing needs.
<h2>Reform or regret</h2>
<a href="https://www.churchilltrust.com.au/media/fellows/Hodyl_L_2014_Social_outcomes_in_hyper-dense_high-rise_residential_environments_1.pdf" target="_blank">Hodyl’s report</a> makes a case for urgent market reforms to establish density controls; density bonuses to link development to public benefit, including open spaces, affordable housing and community facilities and an enforceable tower separation rule to mandate the minimum distances between towers. It also argues that Melbourne would benefit from apartment standards.
In Sydney, guidelines and processes have long been in place to regulate minimum apartment sizes, maximum numbers of apartments per floor, requirements for window provision, minimum floor-to-ceiling heights and minimum storage sizes (<a href="https://www.legislation.nsw.gov.au/maintop/view/inforce/epi+530+2002+cd+0+N" target="_blank">SEPP 65</a>).
Reforms towards “good design” pre-suppose an understanding of the future occupants of apartments and their housing needs. A recent study found “good design” is a reasonably <a href="https://researchbank.rmit.edu.au/view/rmit:28891" target="_blank">uncontroversial concept</a>: it is design that accommodates changing household comfort and needs, and contributes positively to the environment, health, wellbeing and safety.
A current study called the <a href="https://www.rmit.edu.au/research/research-institutes-centres-and-groups/research-centres/centre-for-urban-research/projects/current-projects/lifetime-affordable-and-tenable-city-housing/" target="_blank">LATCH Project</a> is underway to determine changing household needs and the everyday experiences of inner-city apartment dwellers, including families.
The research reveals the huge diversity of households – future apartment dwellers are not just single-person households and empty-nesters. They need daylight, functioning kitchen spaces, storage, nearby schools and open space. Things that currently fail to align with high-density developments across our cities.
Ralph Horne is Deputy Pro Vice Chancellor, Research &amp; Innovation; Director of UNGC Cities Programme; Professor at RMIT University and Megan Nethercote is Research Fellow at the Centre for Urban Research at RMIT University. Ralph can be contacted <a href="https://www1.rmit.edu.au/staff/ralphhorne" target="_blank">here</a>.
 
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