One of North Sydney's best-known commercial buildings could become hundreds of new homes, with insurance giant Zurich Australia lodging a State Significant Development Application (SSDA) to transform 5 Blue Street into a mixed-use residential development above North Sydney Station.

Rather than demolishing the existing building and starting again, Zurich is proposing an adaptive reuse project that would convert the landmark office building into a 15-level residential development delivering 62 apartments, 86 affordable co-living dwellings, activated retail and significant upgrades to the Blue Street Plaza.

The proposal reflects a growing trend of commercial property owners repositioning ageing office assets into residential housing as Sydney grapples with housing supply shortages and changing workplace demand.

<img alt="Zurich" data-entity-type="file" data-entity-uuid="0bba7d12-06dc-4375-aad7-238c94b21ac5" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-22%20at%2010.42.05%E2%80%AFAM.png?VersionId=NJl5oLAEBDGuPmY3RnyliKODjMc8lvRh" />

Located directly above North Sydney Metro and train station, the 3,051 sqm site occupies one of the most strategically positioned parcels of land on Sydney's Lower North Shore.

Designed by fjcstudio, the proposal seeks to retain and adapt much of the existing structure while creating a contemporary residential address that better connects with the public domain surrounding North Sydney Station.

The application proposes two basement levels, ground floor retail, affordable co-living accommodation across the podium levels, and apartments above, while preserving and enhancing the publicly accessible Blue Street Plaza.

Rather than pursuing maximum apartment numbers, Zurich has opted for a housing mix heavily weighted towards larger owner-occupier residences.

The proposal includes 62 build-to-sell apartments comprising 12 one-bedroom, 19 two-bedroom, 29 three-bedroom apartments and two premium penthouses. It also incorporates 86 affordable co-living dwellings, which would be managed in perpetuity by a Community Housing Provider.

That balance between traditional apartments and affordable housing reflects the NSW Government's push to increase housing diversity around major transport infrastructure.

The proposal has been lodged concurrently with a rezoning application, with Zurich arguing the site is ideally positioned to support additional housing given its immediate proximity to public transport, employment and services.

"The proposal aims to respond to the housing challenges facing Sydney through the delivery of diverse housing types in a highly accessible location," the design report by fjcstudio states. It also seeks to improve pedestrian amenity through upgrades to Blue Street Plaza while creating a high-performing residential building that responds to the surrounding context.

<img alt="Zurich" data-entity-type="file" data-entity-uuid="36082e15-c636-4481-bb68-5a5f6443fe39" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-22%20at%2010.41.36%E2%80%AFAM.png?VersionId=5P6VD.fvmqjQfIG3TWWMRXxQWiQBjeFB" />

Rather than replacing the commercial building, fjcstudio has developed a design that works with the existing structural framework above the rail corridor, an approach that significantly reduces demolition while allowing the site to be repositioned as a mixed-use residential precinct.

The existing structural constraints have informed much of the building's design, including its relationship with Blue Street and surrounding public spaces.

The building has been designed as a slender tower rising above a clearly defined podium, with vertically expressed façades intended to reduce the perceived bulk while reinforcing North Sydney's emerging skyline.

According to fjcstudio, the architectural language responds directly to the surrounding commercial towers while maintaining a finer grain expression more closely aligned with the neighbouring Lavender Bay streetscape.

The tower incorporates articulated façade elements, landscaped podium edges and recessed upper levels to soften its appearance and improve pedestrian amenity below.

A significant component of the proposal is the revitalisation of Blue Street Plaza.

The existing public space has long served as one of the primary pedestrian connections between North Sydney Station, Greenwood Plaza and Blue Street, yet its role is expected to become even more important following the opening of Sydney Metro.

Zurich's proposal seeks to strengthen that role by improving landscaping, introducing new retail frontages, enhancing pedestrian permeability and creating more active edges throughout the day and evening.

Ground floor retail would wrap the plaza, while separate residential and co-living entries have been designed to improve wayfinding without reducing street activation.

Landscape design has been integrated throughout the podium and public realm, softening what is currently one of the most heavily urbanised parts of North Sydney.

&nbsp;

&nbsp;

fjcstudio has carefully oriented apartments towards Sydney Harbour and the CBD while using privacy blades and articulated façades to minimise overlooking between neighbouring buildings.

Large framed openings along the western elevation maximise harbour outlooks, while the eastern apartments have been angled towards the south-east to improve privacy from neighbouring development.

The project forms part of the continuing transformation of North Sydney from a predominantly commercial CBD into a genuine mixed-use city centre.

Since the completion of Victoria Cross Metro Station, developers have increasingly shifted their attention towards residential projects capable of leveraging the area's unparalleled transport connectivity.

&nbsp;

FiveX recently lodged plans for a 61-storey, 490-apartment tower that would become one of the tallest residential buildings in North Sydney if approved.

Aqualand continues to expand its Lower North Shore presence following the completion of AURA on Walker Street and its recent St Leonards and Roseville proposals.

Developers are also progressing projects throughout Walker Street, Miller Street and the Victoria Cross precinct as demand for well-located owner-occupier apartments continues to strengthen.

Joel Robinson

First look: Zurich targets North Sydney office conversion with 148-unit proposal above Metro station

Busy developer Aqualand Prestige has formally taken the next step in its expansion across Sydney's Lower North Shore, lodging a State Significant Development Application (SSDA) for its long-held Archer Street site in Chatswood.

The application covers <a href="https://www.apartments.com.au/new-apartments/51-55-archer-street-chatswood-nsw-2067">51-55 Archer Street</a>, a 1,767 sqm amalgamated site on the eastern edge of the Chatswood CBD, where the developer is seeking approval for a 45-level mixed-use tower delivering 114 apartments, including a significant affordable housing component, alongside retail, commercial space and six basement levels of parking.

The SSDA marks the latest milestone for a project Aqualand has been quietly progressing over the past two years. The developer first secured the site for its Aqualand Prestige platform before undertaking an alternative design excellence process with PTW Architects, ultimately avoiding a formal design competition through the Housing Delivery Authority pathway.

The proposal has evolved considerably from Aqualand's original concept. The revised scheme has been designed around larger owner-occupier product, with an unusually high proportion of three and four-bedroom apartments, targeting the more affluent buyer profile, and downsizer, emerging across the North Shore.

<img alt="Archer St" data-entity-type="file" data-entity-uuid="0171204c-5811-41b5-9b09-2335d1b7c3d0" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-22%20at%208.52.48%E2%80%AFAM.png?VersionId=6YTuxfq.puZo7k2wbfgemcO5K3QfXYGQ" />

The 114-apartment mix comprises six studios, 27 one-bedroom apartments, 18 two-bedroom apartments, 50 three-bedroom residences and 13 four-bedroom homes. A quarter of the building will be dedicated to affordable housing, well above the mandated 15 per cent&nbsp;

PTW has structured the building vertically, with affordable housing across levels one to six, premium apartments through levels seven to 31, duplex skyhomes on klevels 32 to 43, a penthouse on level 44, and a rooftop plant level above. Six basement levels will provide resident parking and servicing.

The tower is proposed to reach approximately 154 metres, placing it among a growing collection of residential high-rises transforming Chatswood's skyline.

Rather than competing purely on height, PTW says the design has been driven by creating a slimmer tower capable of delivering significantly larger apartments.

"The primary objective of this project was to create a distinctive building that stands out from the recently approved or built structures in the Chatswood area," the design report states, noting the structural efficiency allows greater investment into apartment quality and resident amenity.

Residents would have access to more than 450 sqm of communal open space including landscaped gardens, swimming pool, rooftop entertaining areas, fitness spaces, community gardens, children's play areas and barbecue facilities.

A major focus of the design has been the public domain.

The ground plane has been opened up through landscaped terraces inspired by Willoughby's sandstone ridges, with native planting, public seating, artwork, retail activation and a series of gathering spaces intended to soften what has traditionally been a hard commercial streetscape.

The landscape strategy references Blue Gum forests once common throughout the area, while incorporating Indigenous storytelling, public art and lighting installations to strengthen the connection to Country.

Chatswood has been one of Sydney's busiest apartment markets over the past 12 months, with a steady pipeline of both new project launches and fresh development applications.

Hyecorp recently launched Celine, a 122-apartment development just along Archer Street, while Changfa and Huirong Group are progressing The Anderson, an 84-apartment project on Anderson Street.

Develotek recently secured approval for a 101-apartment tower on Pacific Highway, while Tian An LFD received the green light for Hammond Greens, its apartment development on the edge of the Chatswood Bowling Club.

Commercial property developer FiveX is also making its move into the residential market. Last month it lodged plans for a 61-storey tower with 490 apartments, which, if approved, would become one of the tallest residential buildings in Chatswood.

Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/first-look-fivex-targets-chatswood-skyline-with-61-storey-tower-after-north-sydney-plans">First look: FiveX targets Chatswood skyline with 61-storey tower after North Sydney plans</a>

Aqualand is also expanding its development pipeline following the launch of its luxury residential brand, Aqualand Prestige. The developer has delivered a string of high-end apartment projects across Sydney's affluent suburbs over the past decade, most recently AURA by Aqualand on Walker Street in North Sydney.

[smartcode_project:default project_id=30959 project_image_fid=292863]

It has since quietly assembled its next wave of projects.

Earlier this year Aqualand launched Boronia in Roseville, a boutique 111-apartment development on Larkin Street. The project is one of the first significant apartment developments to launch in the suburb ahead of what is expected to become one of Sydney's most active new housing precincts under the NSW Government's Low and Mid-Rise Housing reforms, which allow greater density around train stations.

[smartcode_project:default project_id=152095 project_image_fid=373685]

The developer has also lodged plans for a two-tower, 413-apartment development on Herbert Street in nearby St Leonards, further strengthening its presence across the Lower North Shore.

Beyond that, Aqualand remains behind the final stage of Barangaroo, where plans will deliver a five-hectare mixed-use precinct comprising new homes, retail, hospitality and community facilities, alongside a new Metro entrance and more than two hectares of public open space, completing the Barangaroo precinct.

Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/central-barangaroo-development-takes-big-step-with-concept-proposal-approval">Central Barangaroo development takes big step with concept proposal approval</a>

Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/first-look-aqualand-joins-st-leonards-apartment-party">First look: Aqualand joins St Leonards apartment party</a> 
&nbsp;

&nbsp;

&nbsp;

&nbsp;

&nbsp;

First look: Aqualand pushes ahead with Chatswood apartment tower as SSDA lodged for Archer Street

Mass timber is becoming an increasingly popular construction material in apartment developments, but Adelaide developer <a href="https://www.apartments.com.au/developers/otello">Otello</a> is taking the approach a step further.

At its new <a href="https://www.apartments.com.au/new-apartments/flowe-bowden-18-gibson-street-bowden-sa-5007">Flowe Bowden</a> development, the exposed cross-laminated timber (CLT) structure isn't just about reducing the building's environmental footprint. It also forms the foundation of a broader wellness strategy, influencing everything from indoor air quality and natural materials to the way residents move through and experience the building.

The 115-apartment mixed-use development, designed by Melbourne-based architecture practice Fieldwork, will occupy a prominent island site opposite Bowden Village Reserve, combining one, two and three-bedroom apartments with retail and a dedicated wellness destination.

[smartcode_project:default project_id=152022 project_image_fid=375528]

Wellness isn't confined to a gym or shared resident facility at Flowe. Instead, Fieldwork embedded the concept into the building itself.

The development has been split into two residential wings connected by a naturally ventilated central breezeway, replacing traditional enclosed corridors with open-air walkways that improve natural light, encourage cross ventilation and create more opportunities for neighbourly interaction.

"Rather than treating wellness as something that only happens on the ground floor, our response integrates it throughout the building, which led us to ask what it really means to design a healthy building," Fieldwork Director Quino Holland said.

[smartcode_project:default project_id=152022 project_image_fid=375531]

The building's architecture also reflects Bowden's industrial heritage. The lower podium references the area's historic brick and sandstone buildings, while the upper levels transition to exposed CLT, allowing the timber structure to become a defining feature throughout the apartments and shared spaces.

The use of mass timber sits alongside a range of sustainability initiatives, including a fully electric, gas-free design, rooftop solar and a targeted 5 Star Green Star rating.

[smartcode_project:default project_id=152022 project_image_fid=375524]

Inside the residences, the focus remains on natural, durable materials. Blackbutt engineered timber flooring, exposed CLT ceilings, porcelain surfaces and warm timber joinery create a calming interior palette, while low-VOC finishes and responsibly sourced materials have been selected to improve indoor air quality.

Kitchens have been designed as the centrepiece of each apartment, featuring porcelain island benchtops, timber-look cabinetry and brushed steel tapware, with layouts that maximise natural light and ventilation.

[smartcode_project:default project_id=152022 project_image_fid=375530]

The more traditional interpretation of wellness comes in the form of Level Eleven, a two-storey wellness club spanning the ground floor, mezzanine and first floor.

The facility will include a gym, yoga and reformer Pilates studios, Finnish and infrared saunas, magnesium hot and cold plunge pools, and dedicated recovery spaces. Unlike many residential wellness facilities, Level Eleven will also operate commercially, allowing the broader Bowden community to access the venue while giving residents exclusive membership benefits.

The ground floor has also been designed around everyday living. A café overlooking Bowden Village Reserve will activate the street frontage, while a bike workshop with tool storage, co-working space and dog wash has been incorporated to support daily routines and encourage interaction between residents.

"Flowe brings together my two biggest passions, creating places and creating healthier lives," Otello founder Daniel Harris said.

"We wanted to create something Adelaide hasn't seen before, a genuinely healthy building, where the way you live is lifted without even trying."

Flowe is positioned directly opposite Bowden Village Reserve and within walking distance of Bowden Railway Station and the Adelaide Entertainment Centre, placing future residents just minutes from the Adelaide CBD while remaining connected to one of the city's most established urban renewal precincts.

[smartcode_project_cta:default project_id=152022]

Otello launches wellness-focused Flowe Bowden with Adelaide-first mass timber apartment design

Not all apartment amenities are immediately visible.

Swimming pools, gyms, rooftop terraces and residents' lounges have long featured on buyers' wishlists, but as the way Australians live has changed, so too have the features that make apartment living more convenient.

Increasingly, buyers are placing value on the practical aspects of day-to-day life. Fast internet, EV charging, secure bike storage, flexible workspaces and parcel management are becoming just as relevant as lifestyle amenities, reflecting changing habits and expectations.

Online shopping has been one of the biggest drivers of that shift.

Australians spent a record $82.6 billion shopping online in 2025, with almost one in every four retail dollars now spent digitally, making parcel deliveries a routine part of everyday life rather than an occasional convenience.

For apartment residents, however, receiving those deliveries isn't always straightforward.

Without someone home to accept a parcel, deliveries can be redirected to a nearby Post Office, left in building foyers or common areas, or require building management to temporarily store packages. As apartment living continues to grow across Australia's cities, parcel management has become an increasingly important consideration for both residents and developers.

Australia Post's Parcel Locker network is one response to that shift.

<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/KPZ9j5FRdsQ?si=Qztc1dNP3ZvEIUhb" title="YouTube video player" width="560"></iframe>

Rather than relying on home delivery, eligible parcels can be directed to a nominated Parcel Locker, where they're securely stored until collected. Once a parcel arrives, residents receive a notification through the AusPost app or SMS and can retrieve it using a one-time code or QR code at a time that suits them.

The network has expanded to more than 1,500 locations nationwide, with Parcel Lockers positioned at Post Offices, shopping centres, supermarkets, transport hubs and, increasingly, within or alongside residential developments.

That growing presence reflects a broader change in how apartment buildings are being planned.

Developers are increasingly considering the operational side of apartment living alongside traditional lifestyle amenities. Just as secure mailrooms, bicycle storage and EV charging have become more common inclusions, parcel management is emerging as another feature that supports everyday convenience.

It also helps preserve the arrival experience within a building. Carefully designed lobbies and communal spaces can quickly become cluttered when deliveries accumulate, while secure parcel solutions reduce the likelihood of missed deliveries or parcels being left unattended.

For buyers comparing apartments, these everyday details are becoming part of the decision-making process.

Location, floorplans and finishes remain fundamental, but the features that simplify daily life are carrying greater weight than they once did. As online shopping continues to shape consumer behaviour, secure parcel delivery is increasingly becoming another amenity worth looking for.

Parcel delivery is joining the apartment amenity checklist

Inca Property Group has lodged a State Significant Development Application (SSDA) for Dawn, a 53-apartment oceanfront development overlooking Mona Vale Beach.

The proposal, at 35-39 Darley Street East, would replace an existing 18-apartment strata building with a new owner-occupier-focused development comprising 53 two and three-bedroom apartments, including nine affordable built-to-rent residences delivered under the State's infill affordable housing scheme.

Positioned on a 2,679 sqm elevated site around 280 metres from Mona Vale Beach, the development has been designed to maximise panoramic ocean views while responding to the site's sloping topography.

<a href="https://www.apartments.com.au/developers/inca-property-group">Inca Property Group</a> Managing Director Josh Thompson said the State Significant pathway provided greater certainty for projects of this scale.

"This State Significant pathway gives the team real certainty to progress <a href="https://www.apartments.com.au/new-apartments/dawn-35-39-darley-street-east-mona-vale-nsw-2103">Dawn</a> through to completion," Thompson said.

"It allows us to acquire a one-off site, design it carefully and deliver the right offering for the suburb, assessed by the NSW Government's planning department."

The project is one of the first developments in the area to be assessed under the NSW Government's Low and Mid-Rise Housing policy, with the site sitting on the edge of the policy's designated inner area.

The proposal includes three basement levels providing 124 car spaces, alongside a range of resident amenities including a swimming pool, gym, sauna, wellness facilities and private plunge pools for selected ground-floor and penthouse apartments.

<img alt="Dawn" data-entity-type="file" data-entity-uuid="fc1a1daf-0ce4-4f12-9076-b1fa553c7a91" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-21%20at%208.42.11%E2%80%AFAM.png?VersionId=4GZ9h.gpNkTljbxyAET8Jfhv51XUamDm" />

Thompson said Dawn had been designed specifically for owner-occupiers and downsizers, a buyer profile that has driven demand across Inca's recent Upper North Shore developments.

"The majority of buyers in our recent North Shore projects have been downsizers, and we are learning exactly what this market is looking for. Beyond the location itself, we have included resort-style amenities to deliver a genuine lifestyle offering," Thompson said.

Located within walking distance of Mona Vale Beach, the town centre, Mona Vale Golf Club and the Royal Motor Yacht Club, Dawn represents Inca's first Northern Beaches project following the sell-out of Tara on Park in Waitara and Ellis Residences, currently under construction in St Ives.

Construction will be undertaken by Inca's in-house construction arm, GOP Constructions.

Dawn is the latest major apartment proposal for Mona Vale, with the suburb emerging as one of the key beneficiaries of the NSW Government's new Low and Mid-Rise Housing policy.

New developer One Living, led by industry veteran Joseph Scuderi, recently secured a site on Mona Vale Road, on the border of Mona Vale and Pymble, where it is planning around 140 apartments.

IPM is also planning its third project in Mona Vale, significantly increasing the scale of its previous developments with an 82-apartment proposal at <a href="https://www.apartments.com.au/new-apartments/159-167-darley-street-west-mona-vale-nsw-2103">159-167 Darley Street West</a>, opposite Bayview Golf Course and less than 800 metres from Mona Vale town centre.

Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/one-living-enters-sydneys-new-apartment-market-with-northern-beaches-site-acquisition">One Living enters Sydney's new apartment market with Northern Beaches site acquisition</a>

Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/first-look-ipm-plans-third-mona-vale-project">First look: IPM plans third Mona Vale project</a>

First look: Inca eyes Mona Vale with State Significant DA for Dawn apartments

Budget

<html><body>
GUEST OBSERVER
<div class="page" title="Page 1">
<div class="section">
<div class="layoutArea">
<div class="column">
The Westpac Melbourne Institute Index of Consumer Sentiment rose by 3.9% in November from 97.8 in October to 101.7 in November. 
<div class="page" title="Page 1">
<div class="section">
<div class="layoutArea">
<div class="column">
This is a cracking result. Apart from the brief surge we saw following last May’s Budget this is the highest print for the Index since January 2014. The Index is now 8.3% higher than in September, immediately preceding the change of leadership in the government. 
It marks only the third month out of the last twenty one that optimists have outnumbered pessimists. 
The increase also comes despite the banks’ decisions to raise mortgage rates for both owner occupiers and investors. It is surprising that such events did not have a negative impact on confidence. It appears that such is the boost to confidence from the recent political events that the impact of the interest rate increases was comfortably contained Most remarkably, the confidence of respondents who hold a mortgage increased by 4.1% – a slightly larger increase than the rise in the overall Index. 
There is evidence to support this observation that the result is the net effect of two strong opposing forces. The components of the index that measure respondents’ assessments of their own finances were down, on average, by 5.7% whereas the components of the index that measure respondents’ expectations for the overall economy increased by an average of 15.0%. 
The assessments of personal finances were presumably linked to the interest rate increases whereas the outlook for the economy was most likely boosted by confidence in the new leadership. 
Following a spectacular 13.7% fall in October the Westpac Melbourne Institute Index of Unemployment Expectations rose by 3.3% in November. Recall that lower readings indicate fewer consumers expect unemployment to rise in the year ahead. The Index remains 10.9% below its September level and continues to signal a much less pessimistic attitude towards the labour market than we have seen for a number of years. 
As discussed there were some significant conflicting movements amongst the components of the Index. The sub-index tracking assessments of ‘family finances compared to a year ago’ fell 2.2% and the sub-index tracking expectations for ‘family finances over the next 12 months’ slumped 9.1%. Those falls were probably in direct response to the increase in mortgage rates. 
On the other hand the sub-index tracking expectations for ‘economic conditions over the next 12 months’ increased 5.8% while that tracking expectations for ‘economic conditions over the next five years’ soared 24.2% to its highest level since September 2013. It is likely that a boost in confidence towards the economic credentials of the new leadership team played an important hand here. 
<a href="/images/2015/12/Screen%20Shot%202015-11-11%20at%2010.40.07%20AM.png" target="_blank">Click to enlarge</a>
<img src="/images/2015/12/Screen%20Shot%202015-11-11%20at%2010.40.07%20AM.png" alt="" width="548" height="354">
 
<div class="page" title="Page 1">
<div class="section">
<div class="layoutArea">
<div class="column">
In an encouraging sign for retailers, the sub-index tracking views on ‘time to buy a major household item’ lifted 4.8% although it is still 2.2% below its level this time last year. 
Another encouraging sign for the Christmas spending outlook comes with our special question: “Do you expect to spend more; less; or about the same on Christmas gifts compared to last year”. Since we started this question, seven years ago, the average proportion proclaiming ‘more’ has been 12.5%. Today’s survey scored 16.9% whereas ‘less’ registered 29.6% compared to the average of 34.7%. Consumers in NSW were particularly upbeat with more planning to increase than cut Christmas spending compared to a year ago. 
In fact, this survey shows the most positive mix of Christmas spending plans since we began running this special question in 2009 – a very encouraging signal in the lead in to the holiday period. 
Prospects for the housing market remained soft in this survey. The ‘time to buy a dwelling’ index rose slightly in November but the 1.4% gain still leaves the index down 12.5% over the last year and 29% below its most recent peak in 2013. Weakness persists in NSW; Queensland softened markedly; while Victoria held up well. Possibly in response to recent price falls there was a marked boost in confidence in Western Australia. 
There was another sharp fall in house price expectations. The Westpac-Melbourne Institute House Price Expectations Index fell 7.9% to be down 18.7% over the year. The biggest falls this month were in NSW and Queensland with price expectations in Victoria remaining remarkably robust. 
The Reserve Bank board next meets on December 1. Following its November meeting the Bank has adopted a ‘medium’ easing bias with the low inflation environment affording scope to ease if that is deemed necessary. 
However, the Bank currently expects growth in 2016 of 3.0% (above trend) building to 3.5% in 2017. The positive results from this survey will only bolster these confident growth expectations. There is little chance of a rate cut in December.
<div class="page" title="Page 2">
<div class="section">
<div class="layoutArea">
<div class="column">
The real issue is whether the Bank will eventually act to cut rates next year – as confidently expected by the market. It is our current view that the growth dynamics of the Australian economy will remain sufficiently supportive through 2016 to ensure steady rates. The lift in spending expectations and confidence around the employment outlook from the survey point in that direction 
</div>
</div>
</div>
</div>
</div>
</div>
</div>
</div>
</div>
</div>
</div>
</div>
<a href="/images/2015/12/Screen%20Shot%202015-11-11%20at%2010.41.46%20AM.png" target="_blank">Click to enlarge</a>
<img src="/images/2015/12/Screen%20Shot%202015-11-11%20at%2010.41.46%20AM.png" alt="" width="680" height="218">
 
Bill Evans is chief economist of <a href="https://www.westpac.com.au/" target="_blank">Westpac</a>.
</div>
</div>
</div>
</div>
</body></html>

bevans-rYk9SxEa4r

Political change further boosts consumer sentiment: Bill Evans

<html><body>
No change to NSW first home buyer grants in the state budget could intensify activity before the grant's 1 January 2016 reduction.
The grant for buyers of new homes is scheduled to be reduced from $15,000 to $10,000. 
While recipient numbers are up, first home buyers have been largely absent from the booming Sydney market, hesitant at purchasing new homes. 
Grants for established home purchases for first time ceased three years ago.
But the $5000 reduction could spark a Home World flurry over the next six months. 
The Government budget papers said it was continuing to target its first home owner assistance (grants and transfer duty concessions) to support the purchase or construction of new homes, which is helping increase the supply of new housing in NSW. 
In 2014, the Government provided 7,955 First Home Owner Grants for new homes, a 25% increase on the previous year.
A $15,000 grant is available to first home buyers where the value of the new home purchased does not exceed the First Home Owner Grant Cap of $750,000 for contracts dated on or after 1 July 2014.
The amount of the grant will reduce to $10,000 from 1 January 2016.
There is also a wider duty exemption on new homes valued up to $550,000 and vacant land valued up to $350,000.
A duty concession on new homes valued between $550,000 and $650,000, and vacant land valued between $350,000 and $450,000.
The recent strength in the Sydney property boom was being especially driven by properties <a href="/expert-insights/less-revenue-growth-ahead-but-nsw-state-budget-benefits-from-7-29-billion-stamp-duty-bonanza">valued over $1.2 million, the NSW State Budget revealed</a>, but the housing boom longevity is not being assumed by the NSW Treasury.
NSW land tax revenues are forecast to rise at a faster rate than stamp duty revenues, <a href="/expert-insights/nsw-land-tax-revenue-increases-to-outdo-stamp-duty-revenue-growth">according to the NSW state budget papers</a>.
</body></html>

jchancellor-FAypfDUnLy

No NSW state budget first home grant changes so $5000 January 2016 reduction deadline looms

<html><body>
The NSW government - sitting on stamp duties that have almost doubled since taking office - will continue to reap the revenues until any correction.
The state budget didn't raise or lower property taxes, with spending on infrastructure the priority.
It noted the recent strength in the Sydney property boom was being especially driven by properties valued over $1.2 million, the NSW State Budget revealed, though the housing boom longevity is not being assumed by the NSW Treasury.
"The $1.2 million plus market accounted for only a relatively small proportion of properties, but made a large contribution to the growth in revenue," the budget papers advised.
The New South Wales budget was released at midday on Tuesday, with much information pre-released. 
The State Government revealed it is on track to deliver a record $2.1 billion surplus this financial year, instead of the deficit predicted in last year's budget.
The Government's improved financial bottom line is largely due to the stamp duty windfall in stamp duty, due to the Sydney housing boom.
The booming Sydney property market secured a record $7.29 billion revenue in stamp duty, up from $6 billion in 2013-14.
Revenue is tipped to rise to $7.8 billion in 2015-16, and to $8.6 billion by 2018-19.
Turbocharging Treasurer Gladys Berejiklian's first state budget, the tally, which includes residential and commercial property transactions, is $1.29 billion higher than forecast.
But the budget papers indicated residential stamp duty growth was expected to moderate to 11.8% in 2015-16 following growth rates of 21% in 2012-13; 39% in 2013-14 and an estimated 20% spurt in 2014-15.
"Transfer duty is a large and highly cyclical revenue source which is inherently volatile and can be subject to sharp corrections.
"Growth in transfer duty is now more narrowly based than at the beginning of the cycle."
It noted a number of atypical factors had extended the current cycle including  low interest rates, population growth and investor demand.
"Recent moves by APRA may also see a slowdown in activity," the budget papers advised.  
Figures from the Office of State Revenue showed that, by May, the Government had secured its budgeted figure of $6 billion in land transfer duties, two months ahead of the end of the financial year.
NSW has not adjusted its stamp duty rates for 31 years.
Transfer duty represents 28% of state government revenue. Land tax represents 10% 
Premier Mike Baird said increasing housing supply was the most effective action state governments could take on housing affordability, with plans that some of the extra revenue from stamp duty injected into the Housing Acceleration Fund to speed up the delivery of more housing and put downward pressure on home prices.
It will also establish a Greater Sydney Commission, tasked with ensuring targets for the construction of new homes are met.
No change to NSW first home buyer grants in the state budget <a href="/expert-insights/no-nsw-state-budget-first-home-grant-changes-so-5000-january-2016-reduction-deadline-looms">could intensify activity before the grant's 1 January 2016 reduction</a>. 
NSW land tax revenues are forecast to rise at a faster rate than stamp duty revenues, <a href="/expert-insights/nsw-land-tax-revenue-increases-to-outdo-stamp-duty-revenue-growth">according to the NSW state budget papers</a>.
</body></html>

Less revenue growth ahead but NSW State Budget benefits from $7.29 billion stamp duty bonanza

<html><body>
WA residential and commercial property investors are budgeted to pay an extra $826 million in property taxes over the next four years.
It follows State Treasurer Mike Nahan introducing the state's second consecutive land tax increases in last week’s State Budget.
This year’s move follows a 10% increase in land tax rates in last year's budget.
Commercial property and residential investors face a $300 flat tax for land with an unimproved value of between $300,000 and $420,000, and the raising of land tax rates on most properties valued above those levels.
Currently investment property is taxed at a rate of 0.11% of its value above $300,000, at 0.58% above $1 million and at 1.51% above $2.2 million.
Property with an unimproved value of less than $300,000 will remain free from land tax.
Only the top rate of the current land tax scale, the 2.67% levied on the value of land above $11 million remains unchanged in the State Budget.
The State Government now expects to collect $939 million in land tax with next financial year, it is expected to be 26% higher.
Mr Nahan says WA’s land tax regime remained “competitive” with other states citing a landholding with an unimproved value of $1 million being levied $1750 in land tax next year, up from $770 currently.
That compares to $9188 in NSW, $2975 in Victoria and $4500 in Queensland, he said.
</body></html>

Land tax hike for WA property investors

<html><body>
When the Budget was released this week I kept reading with great interest that the government had failed to address ‘housing affordability’. Truth be known the only thing that the Abbott government actually controls is foreign buyers and taxation such as negative gearing and capital gains tax. With regard to foreign buyers it has been well documented that with regard to this portfolio they have Failed it with a capital ‘F’.
In fairness the Federal government would respond by saying that to the contrary they have already unleashed the Australian Taxation Office (ATO) to forensically investigate all property transactions that they believe have contravened the laws. Well if it wasn’t for some bloggers and journalists who pointed this out to the Abbott government foreign buyers would be still running amok. I believe the findings will leave most property observers gobsmacked because I believe we are talking about thousands and thousands of sales.
It’s interesting to note that last week a Senate committee made 40 something recommendations pertaining to housing affordability which included calls to review negative gearing and the appointment of a federal minister for housing, to name just two. Well I have been vocal on not having a housing minister since the Abbott government came to office. More interesting was that Coalition senators immediately rejected the findings – well no surprises there.
If you look closely at the housing affordability debate it can be quickly summed up that data shows we are not building enough high density developments. I wrote about this recently – Lots of positives from discussing negative policies where the NSW government has recognised the problem stemming from municipal councils who are rejecting developments despite the Sydney population expanding at unprecedented levels. The NSW government wants to merge councils to free up more development to meet Sydney’s population explosion.
Should the NSW government be successful with its charter then the price of apartments will obviously come down as too rents. So I’m somewhat mystified why property investors are driving up apartment prices when such a major announcement is pending.
The Abbott government needs to take a very serious look at the legislation that allows foreign buyers to purchase off the plan. I believe that it would be sage for the Abbott government to place foreign buyers on – hold until the ATO has released its preliminary findings. What we are seeing today is Chinese developers out bidding the local developers simply because the off – the – plan legislation allows them to sell directly overseas to foreign buyers so these properties never even hit the Australian market. A vast number of these properties are land banked so they remain vacant which again is self-defeating and ludicrous that this can happen in this day and age.
This week we also read that there are foreign criminals trying to buy Australian real estate to wash their money by investing in real estate. Well this is nothing new as I have heard a few examples of agents who questioned some foreign buyers who expressed interest in landmark Sydney residences.
Thailand has had serious problems with the Russian mafia who have bought up significant parts of that country where the government announced a few years ago that it was cracking down hard on these transactions. This is a global problem where Australia immediately needs to take decisive action which also means tightening the many legal loopholes.
Take the recent divestment order on Villa del Mare where it was found that the Chinese purchaser did not have Australian residence. When I wrote about this <a href="/expert-insights/treasurer-joe-s-villa-del-nightmare-robert-simeon">Treasurer Joe’s Villa del Nightmare</a> on March 5 I said that the purchaser would find an Australian resident to buy the property. Well <a href="/news/australian-buyer-lola-wang-li-emerges-with-villa-del-mare-the-39-million-point-piper-firb-home">Australian buyer Lola Li emerges with Villa del Mare, the $39 million Point Piper FIRB home.</a>
The good news to come from this debate is that for the first time “the dogs are barking” and the Abbott government has to act – and act fast. Finding a viable solution to foreign buyers will prove a much harder assignment than towing back boats.
With regard to new developments, for starters there should be a selling ratio of foreign buyers to Australian residents established.
The Australian property industry has never before encountered such a debate and much of this stems from record low global cash rates. Investors are chasing returns and Sydney is one of the hottest property markets on the globe.
The Abbott government needs to send a very clear message to foreign buyers which is either buy or bye?
Mosman Market
When you look closely at the actual numbers of properties on the market you will struggle to say that the market is booming or bubbling as some prefer to say. Historically when markets are booming this coincides with record volumes being on the market which is otherwise known as a feeding frenzy. The confusing parts about our local markets are that stock levels are down 50 per cent on this time last year or thereabouts.
MOSMAN – 2088
• Number of houses on the market this time last year – 102
• Number of houses on the market last week – 57
• Number of houses on the market this week – 57
• Number of apartments on the market this time last year – 72
• Number of apartments on the market last week – 50
• Number of apartments on the market this week – 49
CREMORNE – 2090
• Number of houses on the market this time last year – 7
• Number of houses on the market last week – 3
• Number of houses on the market this week – 4
• Number of apartments on the market this time last year – 27
• Number of apartments on the market last week – 13
• Number of apartments on the market this week – 10
NEUTRAL BAY – 2089
• Number of houses on the market this time last year – 7
• Number of houses on the market last week – 3
•Number of houses on the market this week – 3
• Number of apartments on the market this time last year– 48
• Number of apartments on the market last week – 31
• Number of apartments on the market this week – 27
 Source: APM Price Finder
</body></html>

robertsimeon-hRNTwJyXkQ

Do we tell foreign buyers to buy or bye? Robert Simeon

<html><body>
Small businesses with a turnover of less than $2m can now claim an immediate tax deduction when purchasing plant equipment valued under $20,000.
This new tax break will deliver an early Xmas present to fit-out contractors who specialise in restaurant and small office refurbishments.
I was surprised by the quantum of the tax break.
I think $20,000 as an immediate tax deduction for individual items is a huge amount and an incredible incentive to bring that fit-out forward.
Fit-out contractors now believe in Santa Claus and he’s taken the form of Joe Hockey.
We recently refurbished our office for a cost of $202,000 and were able to claim $35,000 in depreciation in the first year. If we’d carried out the same fit-out today our first year depreciation would’ve been over $123,000.
That’s a huge difference.
Quantity Surveyors are experts in breaking down the overall construction cost into individual items and now has never been a more appropriate time to do this.
There are four main points to consider:
<ol>
<li>Small businesses should ensure a detailed report of any fit-out costs be carried out.</li>
<li>When acquiring any new asset, small businesses should try to keep the costs below $20,000.</li>
<li>This generous bonus has an expiry date of June 30, 2017.</li>
<li>Assets costing over $20,000 can still be depreciated but not claimed as an outright deduction.</li>
</ol>
Some examples of what may qualify for an immediate tax deduction include carpet, desks, blinds, work stations and a lighting upgrade.
Now has never been a better time to upgrade that office or refurbish your restaurant.
TYRON HYDE is director of <a href="https://www.washingtonbrown.com.au/" target="_blank">Washington Brown Quantity Surveyors</a>.
His book <a href="https://www.claim-it.com.au/?utm_source=wbsite&amp;utm_medium=image&amp;utm_campaign=homepagebanner" target="_blank">CLAIM IT!</a> helps property investors maximise their tax benefits through smart deprecation.
</body></html>

tyronhyde-GVUTYT8ZT3

Christmas for contractors as Hockey delivers: Tyron Hyde

<html><body>
The Queensland government has ruled out introducing new taxes on foreign buyers of residential real estate.
They are the only state that actually monitors foreign investment, so were in the box seat to implement such a tax regime.
The rejection comes after the populist Victoria Labor government's recent budget unveiled a new tax regime that will seek to tax foreign buyers and foreign owners.
Queensland has vowed not to ­follow Victoria’s lead and introduce any new taxes on foreign property investors.
Treasurer Curtis Pitt said Queensland welcomed foreign property investment.
“We’re ruling out any stamp duty surcharges for foreign investors who purchase a house in Queensland," said Pitt.
"We’re also ruling out any land tax surcharge for foreign investors in this state.”
The Victorian state budget, revealed on Tuesday, included a 3%t stamp duty surcharge for homes from July and land tax increases of 0.5% from 2016 for offshore-based investors. 
News Ltd reported Queensland executive director of the Property Council, Chris Mountford saying the action will strengthen Queensland’s position on the global investment map.
“In particular it creates a compelling case to invest in Queensland over Victoria.”
Nothing new for Queensland as that was how former premier Joh Bjelke Petersen saw the state into an upswing when Queensland didn't have death duties like other states.
It was in 1977 when the Premier of Queensland Joh Bjelke Petersen abolished death duties and a wave of Australia's elderly headed towards the Gold Coast with the high rise following as dying in Queensland became a tax avoidance scheme and Surfers Paradise became a retirement haven.
</body></html>

Queensland says no new taxes on foreign property buyers in Bjelke Petersen-like strategy

<html><body>
Forget about the folks - asset wealthy part pensioners - passing down the holiday home. 
Treasurer Joe Hockey's 2015 proposed pension change will ensure that elderly parents will have to liquidate the longtime family holiday home to afford to live under any new asset test regime targeted at existing pensioners facing the end of their entitlement.
However couples approaching retirement - and aware of the rules in advance - will possibly compromise on their superannuation voluntary contributions - or sell one of the two $400,000 investment properties - and instead push the funds towards buying an untaxed, un-counted bigger, better home that can be beneficially sold later in retirement.
Without the pension, the immediate likelihood after any January 2017 implementation is that it will be no longer feasible for the grandparents to hold onto the beach house - perhaps initially at least putting it in the 2017 Christmas holiday rental pool to raise some funds to pay the rates and put food on the table.
Social Services Minister Scott Morrison has flagged proposed changes to the pension assets test saying that 91,000 current part pensioners will no longer qualify for the pension and a further 235,000 will have their part pension reduced.
If the legislation is passed, the government will reduce the maximum value of assets to qualify for a part pension, which for couples is currently up to $1.15 million plus the family home.
For couples who own their own home, the asset threshold will be reduced to $823,000.
For single home-owners, the assets test cut-out will be $547,000, down from $775,500.
It is currently suggested people who lose their pension are set to keep the Commonwealth Seniors Health Card which provides access to concessional medicines, but lose their Pensioner Concession Card which secures discounts at the state level on rates, transport and utilities.
Over-55s hold 58% per cent of Australia’s wealth. But the majority is locked up in the family home.
News Ltd papers reported Scott Morrison had only kind words for those retirees who will lose access to the pension.
"My first word to the 91,000 is to thank them for providing for their own retirement," he told reporters in Sydney on Thursday.
"Those affected by these changes have assets, and by drawing down on those assets to those modest amounts they will be in a position to maintain their incomes."
The proposal presents anxiety for the over-50s population, currently 7 million and expected to double by 2050.
Through paid employment, volunteering and care-giving roles, older Australians are estimated to contribute $90 billion a year to the economy and community, the National Seniors Australia recently reported.
The family home, often the most valuable asset Australians own, both materially and emotionally, will remain outside the age pension means test under the proposal.
But the 2015 budget has yet to emerge as providing any solution for older Australians who require age-appropriate housing, which can be secured by rightsizing.
Infact quite the reverse is now the logical prospect in the lead up to the 2017 implementation given the principle place of residence remains sacrosanct in government policy.
"An innovative approach is required to enable seniors to access their equity wealth and downsize without the additional risks and disincentives of reverse mortgages, and without the fear of a negative impact on their Age Pension," National Seniors Australia seek.
The former Labor government’s Housing Help for Seniors pilot scheme, announced in the 2013-14 budget, was deemed a step in the right direction, however, the restrictions on the use of the excess sale funds and requirement to have lived in the home for 25 years, restricted its usefulness to older Australians. 
“A significant number of older Australians will be adversely impacted, so it is critical that clear information and access to advice are a priority so they can consider their position and the adjustments they may need to undertake,” the National Seniors Australia chief executive Michael O’Neill said.=
“These changes will cause anxiety, particularly for those older Australians who have been in receipt of a part pension.”
</body></html>

Upsizing homes before retirement - and forget passing down the holiday shack: Joe Hockey's 2015 budget pension implications

<html><body>
Victorian Treasurer budget papers warned that the most likely risk to predicted Victorian tax revenue was posed by ­reduced stamp duty income if ­investor sentiment wanes.
Treasury figures show stamp duty revenue from Victoria's property market rose by 27% in 2013-14.
Property taxes are forecast to contribute $7.7 billion to the state's total $18.2 billion tax revenue in the current financial year.
The higher income from property offsets recent weaker revenue from gambling taxes.
"As the upward momentum of the current cycle builds, so does the likelihood of a correction, as has been the case in past property cycles," Treasury warned.
The strong property has also boosted land taxes forecast to be around $1.8 billion next financial year.
The new 3% land transfer duty surcharge for non-resident Australians is tipped to add a $39.5 million in 2015-16.
Treasurer Tim Pallas said the government was still working through how its new taxes for foreign buyers would be applied. 
A 0.5% land tax surcharge for absentee owners of Victorian property will also be imposed next year, expected to raise $53 million over four years.
“Let’s be frank — the state of Victoria has a very high dependence on the performance of the property market through both land tax and stamp duty,” Pallas said.
“That that is a risk to the budget is, I think, an undeniable fact.”
</body></html>

Victorian Treasury fears Melbourne property price correction

<html><body>
GUEST OBSERVATION
It is budget time again and, like on many previous occasions, the voices seeking easy publicity are calling louder and louder for the abolition of negative gearing. Housing affordability is a hot topic in an environment where property prices are rising, in some places quite significantly, so the media is happily running with this agenda without questioning the basis of various claims.
But how can you have an honest debate on the issues involved if none of those commenting against negative gearing demonstrate enough knowledge on the topic they are talking about?
Dispelling myths about negative gearing is like trying to convince a 3 year old that "spinach is good for you"… It requires some maturity to comprehend the topic of the discussion before one is able to participate without any prejudice.
It may appear as a harsh and provocative assessment of those criticising negative gearing and Australia’s current tax arrangements - especially since the anti-negative gearing voices include prominent economists, managers of investment funds, various social think-tank organisation and media personalities. But if you scrutinise what they are saying it is very obvious they are just repeating overheard phrases without any understanding of the meaning of what these words really mean. Just like the aforementioned 3 year olds…
Just to illustrate, the prevailing theme is that negative gearing is a "cost to taxpayers"… Really? How about taking a class in basic accounting to understand the principles of cash flow before making any such statements publicly? Then the commentator would understand the negative gearing is all about cash flow and not about profit and therefore, that it is neutral from an overall tax perspective. (I explained the mechanics in my earlier article if you care to read - <a href="/news/negative-gearing-the-three-facts-that-will-challenge-your-assumptions">Negative gearing: The three facts that will challenge your assumptions</a>).
Then there are ideas about changing the provisions to allow negative gearing on new properties only, to increase new build. Yeah, right, great idea. Let’s keep all those people unable to buy isolated in renter ghettos, or relegate them to city fringes, and keep the suburbs pristine and free from temporary drifters. Let’s repeat those social housing experiments from 1960’s and 1970’s (this time round with private money) which legacy is still haunting parts of our capital cities half a century later.
Of course I am exaggerating the possible consequences but only to highlight that those who call for such arrangements did not think through the full consequence of what may happen. Ask yourself, where is the greatest demand for rental accommodation? Of course, in city centres and along major transport routes. This is where investors are providing the bulk of rental stock - because this is where the demand is. And of course this is, in the great majority of instances, second-hand and not brand new stock for a very obvious reason.
“But” they say, “if properties were cheaper in those convenient locations, more people could afford to buy there and would not need to rent”. Great logic. Sure, let’s implement policies that will allow converting everything in such locations to cheap owner-occupier housing – and then we will end up with a real housing affordability problem for those who prefer or are forced to rent. But sure enough, taxpayers will be very happy to spend billions of dollars to address it, no worries.
The premise that renters will buy “cheap houses” rather than continue renting would be amusing if it was not promoted so seriously by those prominent commentators. The naivety of such thinking, on such a large scale (mind you, without any evidence and/or testing the assumptions), is staggering.
One only needs to look to late 1990 to understand why such thinking has no merit whatsoever. In particular, towards the end of 1990’s, the cost of owning a property was at a historically low level and in many locations renting was costing more than paying off a property and still, not everybody was prepared to buy, even if they could afford it easily.
All those commentators are forgetting the basic logic that drives people’s decisions – if prices are cheap, they are so for a reason. That is, owning is perceived by the majority as unattractive and without a merit, and cheap prices in relation to rental expenses only reinforce this perception. People need to perceive a positive outlook for the property market to want to own the place of their residence - this outlook can only be reinforced by a history of rising prices. It’s as simple as that, yet so difficult to comprehend for many.
Then we have such pearls of wisdom like grandfathering negative gearing on existing purchases but, at the same time, allowing for the writing-off of operational loses against capital gains. Great, let’s make tax affairs so complicated that nobody will be able to figure out whether they are making money or losing it. Accountants will love it and growth of employment at the Tax Office will propel Australia’s economic growth for the next few decades.
Or how about proclaiming that before 1986 there were no property investors in Australia (because this is what housing finance statistics “show”) and that the “current property investment boom crisis” is the fault of Keating and Hawke re-introducing negative gearing and Howard and Costello halving the capital gains tax on investment properties? This position conveniently disregards the fact that the proportions of rental stock remained relatively static for many, many decades. So what is really going on?
<img src="/images/2015/05/04/Occupied_private_dwellings.png" alt="">
Those commentators simply don’t comprehend that there was a shift in the investor profile from, a situation where a single person owned entire blocks of flats, to that where now many individual investors only own one flat each. Those aforementioned policies were just a catalyst enabling this transition to happen.
And because of these policies, people now have a choice to either live where they are and invest their extra money in the long term rental accommodation business (yes, it is a business after all) or upgrade their primary residence - and the financial outcome is the same at the end. Unbelievable but true, once you do the math.
But the biggest fable of all is that negative gearing is the reason prices are “so high” today. So, by removing negative gearing, we will restore “housing affordability” - whatever that means. Pity not many can understand what is really driving property prices in Australia.
It doesn’t fit in these people’s agendas that the cost of buying and renting in Australia is close to its historically best level, and that housing is more affordable now than at many points in time in the last three decades. Even in Sydney – the apparent “epicentre of housing speculation”.
<img src="/images/2015/05/04/Long_term_purchase_affordability_Sydney.png" alt="">
Interestingly enough, NSW’s share of net rental income losses was only 5.7% in the 2012-13 financial year (or $312 million out of $5.5B claimed by investors – as per Table 15 of recently published statistics that show all income and expense items from rental property schedules, by the state/territory location of the property). This means that just two years ago, in aggregate, profits from long term rental accommodation business in NSW almost matched losses.
In other words, negative gearing was not as widespread in NSW as everybody is led to believe. No surprise here at all since purchases with gross rental yields of 6-7% were not that uncommon in Sydney in 2012. But why bother with facts that spoil a “good story” for media attention.
By the way, where were these commentators in 1997-99, 2005/6, 2009 or 2012-13 when there were ample opportunities to buy property cheaply? Why they were not heralding those opportunities then as loudly as they now voice their opposition to negative gearing? (As a side note, did you notice how regularly these opportunities come about?) There is a simple answer - because back then they were chasing media headlines with another favourite crowd pleaser - the upcoming Armageddon.
My, in many ways, aggressive and ironic commentary serves the purpose of mobilising you - the reader - to start confronting these commentators and questioning their understanding of a concept they are so outspoken about. And secondly, treating what you read and hear on the news about negative gearing with a fair dose of scepticism.
After all, in the whole scheme of things, negative gearing is inconsequential for individual property investors – sure, it helps with cash flow but it does not impact profitability and certainly, it does not make houses more expensive. So, its abolition would not change a thing – but that point of view is missing from the public debate.
Journalists are failing in their duty to present information objectively by not offering contrasting opinions and, most importantly, by not questioning individual commentators on merits of their points of view.
I have a tip for anybody who wants to know whether a particular commentator has any idea about the topic of negative gearing - check if they consider negative gearing to be a cost to taxpayers, or offering extra profit for investors, or none of the above. If they do consider it a cost or extra profit opportunity, then you know you cannot take seriously anything they say, no matter what other credentials they present.
Arek Drozda is an independent property market analyst. Follow on Twitter @arekdrozda.
 
 
 
</body></html>

Budget

Editor's Picks

Have something to contribute?

Developments

New apartments

New townhouses

News

Budget

Editor's Picks

Receive the latest news stories to your inbox

Have something to contribute?

Developments

New apartments

New townhouses

News