Repeat buyers are one of the strongest measures of confidence in any apartment development.

At <a href="https://www.apartments.com.au/new-apartments/era-newcastle-west-124-126-bull-street-newcastle-west-nsw-2302">ERA</a> in Newcastle West, some purchasers are returning to <a href="https://www.apartments.com.au/developers/gwh">GWH</a> after living at the developer's One Apartments. Their decision to purchase again was driven by the quality of life they found after moving into their first GWH home.

Keith Wilton had spent years living in a house in East Maitland before deciding it was time for a change. Apartment living had always been on his radar, but he was selective about what he wanted.

<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/FH_1EzB-1vs?si=XScVlP1ERsTDJoME" title="YouTube video player" width="560"></iframe>

"I had some boxes I wanted to tick," he says.

Keith points to the open-plan design, generous outdoor areas and considered inclusions as key reasons One Apartments worked for him.

“One of those things was a nice indoor open plan area, but also I wanted a nice outdoor open area that I could entertain on in summer or Christmases or birthdays,” he says.

He also found value in the smaller details, from integrated appliances to shared resident spaces including the pool, cinema and rooftop areas.

[smartcode_project:default project_id=135096 project_image_fid=356818]

After comparing several developments, he chose One Apartments because of GWH's longstanding local reputation and his own experience working with the developer on a commercial project more than a decade earlier.

"I knew that they were local, that the quality of the build was going to be up there. I'd looked at other apartment complexes around and close by, and I just knew that here was a better decision location wise."

Today, Keith says the move has completely changed how he experiences Newcastle.

"I enjoy living in this location because it's more of a lifestyle change. That Newcastle city living where you can walk to restaurants and bars and even beaches and parks and even shopping across the road."

[smartcode_project:default project_id=135096 project_image_fid=356828]

Beyond the location, he says it's the sense of community that has surprised him most.

"Everyone loves living here because they chose to live here, but everyone looks out for each other. It's a real great community feel here."

For Aimee and Lyle Goodman, the journey started almost by chance.

<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/tsioMLcnjas?si=zq-ys3JuWpfa5hFv" title="YouTube video player" width="560"></iframe>

The couple happened to be having coffee in Newcastle when they noticed the site where One Apartments was about to begin construction.

"We were aware GWH was planning a development," Aimee says. "We made one phone call and things moved pretty quickly after that."

As busy business owners, they initially thought apartment living would simply reduce the maintenance that came with larger homes. Instead, it fundamentally changed how they spent time together.

"We actually catch up more as a family now," Aimee says.

"We've had homes with big yards and lots of space, but everyone ended up in different rooms. Here we'll have dinner together, the kids can play, and we spend far more quality time together."

[smartcode_project:default project_id=135096 project_image_fid=356829]

Lyle says their confidence came from GWH's reputation within Newcastle's building industry.

"I know people who've worked across different apartment projects, and whenever GWH came up the feedback was always the same. They're rock solid. They're quality."

That confidence only grew throughout the buying process.

"One of the things that really impressed us with GWH was the whole process, was the communication," Lyle says. "It was consistent, it was regular, there was no problem if we had some weird questions, there was no problems in getting answers."

[smartcode_project:default project_id=135096 project_image_fid=351104]

Aimee says one moment stood out.

"The project actually finished on time. We realised we needed to hurry up and sell our house because everything was happening exactly when they said it would."

The positive experience at One Apartments ultimately gave all three buyers the confidence to purchase again with GWH, this time at ERA.

Their confidence reflects what many buyers are seeking in today's apartment market. Location remains important, but so too does certainty around delivery, quality and long-term liveability.

[smartcode_project:default project_id=135096 project_image_fid=356822]

ERA builds on those foundations with 280 one, two and three-bedroom apartments across two landmark towers in <a href="https://www.apartments.com.au/developments/newcastle-west-nsw-2302">Newcastle West</a>.&nbsp;

Designed by <a href="https://www.apartments.com.au/architects/fk-australia">Fender Katsalidis</a>, the project will include more than 2,000 square metres of resident amenities, including a resort-style pool, gym, sauna, private cinema and rooftop entertaining spaces overlooking the harbour and coastline.&nbsp;

The development is also within walking distance of the Newcastle Interchange, Honeysuckle, Darby Street, the harbour foreshore, restaurants, retail and the city’s beaches, continuing the walkable lifestyle that existing GWH buyers say has transformed how they live.

[smartcode_project:default project_id=135096 project_image_fid=356826]

For Keith, the appeal remains straightforward.

"You feel at home even before you've moved into your home."

For Aimee, the change is measured in time.

“I just felt like I had more time,” she says.

[smartcode_project:default project_id=135096 project_image_fid=351102]

Construction at ERA is now underway, with more than half of the residences already sold and limited two and three-bedroom apartments remaining in the East Tower release. Priced from $980,000 for two-bedroom residences and $1.46 million for three-bedroom residences, buyers can secure an apartment with a 10 per cent deposit, with premium homes offering ocean views from Level 8 and harbour views from Level 10.

ERA is also backed by Resilience Insurance's 10-year Latent Defects Insurance policy, providing protection against structural or waterproofing defects for 10 years after completion. The project is anticipated to be completed in early 2028.

[smartcode_project_cta:default project_id=135096]

Joel Robinson

From ONE to ERA: Why buyers are choosing GWH again in Newcastle West

Virgate Property Group is preparing to commence construction of Verdé, its new apartment development in Melbourne's Arts Precinct at Southbank, following a strong run of sales that has seen more than half of the project's 173 apartments secured.

Verdé has attracted a broad mix of first home buyers, owner-occupiers upgrading from nearby inner-city suburbs and investors, with younger owner-occupier couples aged between 28 and 45 accounting for the strongest enquiry. Many are already living in Southbank, South Melbourne, Albert Park, Port Melbourne, South Yarra and the CBD.

"Verdé is located in one of the most desirable pockets of southern Melbourne," Blair Property Group Director Darren Blair, who is managing sales at Verdé, said.

"It's within walking distance of the Arts Centre, Royal Botanic Gardens, Albert Park Lake, and Southbank's restaurants and retail. It's a great lifestyle location with strong amenity and liveability, which made it a very attractive choice for the project."

[smartcode_project:default project_id=4661 project_image_fid=372549]

Virgate was already familiar with the precinct, having previously delivered the successful Domain House development in neighbouring South Melbourne. That experience gave the developer confidence to acquire the Coventry Street site and continue expanding its presence in Melbourne's inner south.

"We had been keeping an eye on the site and the broader precinct for a few months before deciding to move forward with the acquisition," Virgate said.

The project was ultimately secured in 2020 following feasibility studies, planning assessments and due diligence, with the brief centred on delivering "a high-quality, considered design that feels both refined and fit for purpose."

[smartcode_project:default project_id=4661 project_image_fid=314259]

Designed by <a href="https://www.apartments.com.au/architects/bruce-henderson-architects">Bruce Henderson Architects</a>, Verdé comprises 173 one, two and three-bedroom apartments priced from $599,000. The architecture is distinguished by a faceted glass façade that responds to both the site's outlook and Melbourne's changing light conditions.

According to Bruce Henderson Architects, the coloured glazing gives the building a distinctive identity while also providing privacy and solar shading, with residences oriented to capture views across the bay, city skyline and surrounding parklands.

Inside, <a href="https://www.apartments.com.au/interior-designers/designoffice">DesignOffice</a> has created interiors focused on natural light, efficient planning and enduring materials. Apartments feature engineered oak flooring, natural stone benchtops, floor-to-ceiling glazing and SMEG appliances, while a restrained material palette aims to complement the expansive outlooks rather than compete with them.

[smartcode_project:default project_id=4661 project_image_fid=372550]

Resident amenity has also been designed around everyday functionality rather than occasional use. Facilities include a concierge-serviced lobby, residents' lounge with fireplace, library and co-working space, gym, terrace garden with barbecue facilities, ground-floor café, and package delivery management.

The project's location continues to be one of its strongest drawcards. Positioned on Coventry Street, Verdé sits within walking distance of the National Gallery of Victoria, Arts Centre Melbourne, Royal Botanic Gardens and Albert Park Lake, while Southbank's dining precinct, Sturt Street trams and the new ANZAC Station are all nearby. The surrounding education catchment also includes Melbourne Grammar, Melbourne Girls Grammar, Mac.Robertson Girls' High School and several major university campuses.

The sales team says buyers have responded particularly well to the combination of location, design quality and long-term liveability.

"They're responding really positively to the quality of the design, premium resident amenities and the uninterrupted views. Many also appreciate the location and how connected it is to everything they need."

The ability to secure stamp duty savings before completion has also been a key factor for purchasers, alongside the opportunity to personalise finishes ahead of settlement.

With construction set to commence soon and more than half the apartments already sold, Verdé enters its next phase as one of the Arts Precinct's more established apartment developments, offering remaining buyers an opportunity to secure a residence before construction advances further. Expected completion is scheduled for late 2027.

[smartcode_project_cta:default project_id=4661]

Virgate's Verdé Southbank moves toward construction as sales fly past halfway stage

Downsizer-focused apartment development Kooyongkoot in Hawthorn has been recognised at the 2026 Better Future Melbourne Design Awards, taking home Gold and Silver awards in two categories.

<a href="https://www.apartments.com.au/new-apartments/kooyongkoot-hawthorn-1-kooyongkoot-road-hawthorn-vic-3122">Kooyongkoot</a>, currently being delivered by developer PQD and designed by Cera Stribley, received Gold in the Interior Design – Proposed category and Silver in the Architecture – Proposed category.

The dual recognition reflects the design approach behind the boutique development on prestigious Kooyongkoot Road, where the focus has been on creating homes for downsizers seeking the space, quality and functionality of a detached house within a low-rise apartment building.

Rather than maximising apartment numbers, <a href="https://www.apartments.com.au/developers/pqd">PQD</a> and <a href="https://www.apartments.com.au/architects/cera-stribley-architects">Cera Stribley</a> limited the development to just 18 residences, allowing for larger floorplans, greater privacy, generous landscaping and expansive communal spaces.&nbsp;The majority of the apartments also benefit from corner aspects, allowing for dual sources of natural light.

Now around 70 per cent complete and on track for completion in November 2026, Kooyongkoot will comprise a mix of garden residences, ter​race apartments, sub-penthouses, and is crowned by two half-floor penthouses with direct lift access and private rooftop terraces.

[smartcode_project:default project_id=102717 project_image_fid=355297]

The Silver Award for Architecture recognised the way the building responds to its prominent corner position at the ent​rance to Hawthorn's Scotch Hill precinct, one of Melbourne's most established residential neighbourhoods.

Rather than competing with the grand homes that line Kooyongkoot Road, the architectural approach focused on restraint and longevity, using curved brickwork, generous landscaping and carefully considered proportions to integrate with the existing streetscape.

"The form feels fluid and timeless, as though shaped by the landscape itself – architecture that belongs, rather than competes," said Chris Stribley, Co-Founder and Managing Principal of Cera Stribley.

The judging submission also highlighted practical innovations throughout the building, including lift cores servicing only nine homes each, a central landscaped lightcourt designed to bring daylight and ventilation into the building, and fully enclosed private storage rooms with lighting, power and shelving to better accommodate residents transitioning from larger family homes.

[smartcode_project:default project_id=102717 project_image_fid=355293]

The Gold Award for Interior Design recognised the project's focus on long-term liveability rather than display-home aesthetics.

According to the awards submission, the interiors were designed from the inside out, prioritising how homes would function over decades of daily use through generous proportions, practical storage, durable natural materials and flexible layouts.

The specification includes natural stone throughout, upgraded acoustic glazing, V-ZUG appliances and fully enclosed storage rooms, alongside an amenity offering focused on wellness, entertainment and everyday convenience.&nbsp;

Residents will have access to a gym and yoga studio, a wellness centre featuring traditional and infrared saunas, a cold therapy shower and treatment room, as well as a residents' lounge and golf simulator/cinema room for entertainment.&nbsp;Kooyongkoot has also considered the everyday convenience of its residents by offering a private carwash and pet wash facilities on site as well as dedicated parcel lockers and oversized fully enclosed storage rooms.&nbsp;

[smartcode_project:default project_id=102717 project_image_fid=355303]

The project's attention to detail has already resonated with buyers. Earlier this year, Kooyongkoot recorded one of Boroondara's highest apartment sales when an $8 million penthouse was purchased by a Melbourne CEO downsizing from a nearby family home.

"Every detail feels deliberate, from the overall design down to the smallest touches," the purchaser said.

"The level of quality and refinement is exceptional, but what really sold it was how liveable it felt... It felt like a place where everything had been considered, not just a luxury building."

[smartcode_project:default project_id=102717 project_image_fid=355304]

Sustainability also formed a key part of both award submissions. Kooyongkoot is targeting a minimum 7.5-star NatHERS rating across all residences, supported by passive design principles, high-performance glazing, EV charging infrastructure, water reuse systems and a wellness model focused on lower-energy dry facilities rather than pools and large wet areas.

Located within walking distance of Scotch College, Methodist Ladies' College, Koo​yong Lawn Tennis Club, Aubur​n Village and Camberwell Junction, Kooyongkoot continues to target owner-occupiers looking to remain in Melbourne's inner east without compromising on space or quality. A limited selection of two, three and four-bedroom residences remains available, with prices starting from $1.9 million.

[smartcode_project_cta:default project_id=102717]

Kooyongkoot wins Gold and Silver at Better Future Melbourne Design Awards

New apartment supply has become increasingly constrained across <a href="https://www.apartments.com.au/developments/parramatta-nsw-2150">Parramatta</a> in recent years, with fewer projects progressing through to completion as development conditions have become more challenging.

It makes <a href="https://www.apartments.com.au/developers/novm">NOVM</a>'s 2021-completed <a href="https://www.apartments.com.au/buildings/the-lennox-parramatta-12-phillip-street-parramatta-nsw-2150">The Lennox</a> one of the most recently completed residential towers on the Parramatta River, and among the newest apartment developments in Sydney's second CBD.

With the project largely completed before the sharp escalation in construction costs and inflation following the pandemic, The Lennox is now offering pricing that would be difficult to replicate in a comparable new development in Parramatta today, or across much of Western Sydney.

The majority of the 413 apartments at The Lennox sold before and shortly after completion. A limited release of the remaining apartments has recently been brought to market by capital partner <a href="https://www.apartments.com.au/project-marketer/equitifund-group">Equitifund</a>, with entry-level pricing from $700,000 and two-bedroom apartments available from under $1 million.

Rising above the Parramatta River at 12 Phillip Street, The Lennox comprises one, two, three and four-bedroom apartments, appealing to first home buyers, young professionals, families, downsizers and interstate investors seeking a completed apartment in one of Australia's fastest-growing economic centres.

[smartcode_project:default project_id=5743 project_image_fid=372394]

Rather than positioning Parramatta as an alternative to Sydney's CBD, Equitifund believes the city has reached a point where it stands on its own merits.

"Parramatta is no longer simply an alternative to Sydney CBD, it's becoming a destination in its own right," Equitifund Executive Chairman Greg Huxley said.

"The Lennox captures that evolution with a level of quality and amenity that's difficult to match at its price point."

[smartcode_project:default project_id=5743 project_image_fid=953]

Designed by <a href="https://www.apartments.com.au/architects/marchese-partners">Marchese Partners</a>, the tower responds directly to its riverfront setting through expansive glazing and open-plan layouts that maximise views across the Parramatta River and city skyline. Interiors feature engineered timber flooring, stone benchtops, stainless steel appliances and floor-to-ceiling glazing, while generous balconies extend the living spaces outdoors.

Marchese Partners says the project was conceived to balance high-quality apartment living with practical, long-term functionality, pairing larger, efficient floorplans with amenities more commonly associated with five-star hotels.

That emphasis continues through the resident facilities, which include a 20-metre rooftop swimming pool, fully equipped gym and wellness spaces, full-time concierge, a residents' lounge, function room, private lifts, secure basement parking and rooftop communal areas overlooking the Parramatta River. Ground-floor boardwalk retail and dining further activate the riverfront and integrate the building into the surrounding public realm.

[smartcode_project:default project_id=5743 project_image_fid=925]

Australian housing and finance group Equitifund has secured the remaining apartments, believing there are few completed apartment opportunities in Parramatta that offer the same combination of location, amenity and pricing.

Equitifund National Sales Director Ben Hamblett says buyers are increasingly recognising that premium apartment living no longer needs to come with Sydney CBD pricing.

"The Lennox is where aspirational living becomes attainable," Hamblett said.

"Wake to river and mountain views, step into Sydney's Second CBD, and arrive home to resort-calibre amenities, all without the harbour price tag."

Hamblett says owner-occupiers are also attracted by the convenience of having Westfield Parramatta, Church Street's dining precinct, Parramatta Park, Riverside Theatres, Western Sydney University and major transport connections all within walking distance.

"At The Lennox, lifestyle is not an afterthought, it is the foundation."

[smartcode_project:default project_id=5743 project_image_fid=5374]

The Lennox places residents within walking distance of Parramatta Square, Westfield Parramatta, Church Street Eat Street, Parramatta Station, the ferry wharf, Light Rail, the future Sydney Metro West, Parramatta Park and CommBank Stadium, reinforcing Parramatta's position as one of Australia's most connected metropolitan centres outside Sydney's CBD.

Equitifund says buyers visiting the display suite consistently comment on the quality of the finishes, generous floorplans, river and skyline views, and the walkability of the location. The project has attracted a broad mix of local professionals, upsizers, downsizers, buyers relocating from Sydney's inner suburbs and interstate investors seeking long-term growth opportunities.

That demand aligns with Parramatta's continued evolution as an economic powerhouse. Equitifund Research and Market Insights specialist John Bekiaris says sustained population growth, infrastructure investment and expanding employment opportunities continue to support long-term housing demand across the city.

"Parramatta has evolved from a satellite city into one of Australia's most important economic centres. Population growth, infrastructure investment and employment are all supporting sustained long-term housing demand."

[smartcode_project_cta:default project_id=5743]

The apartment price gap drawing Sydney buyers west

A luxury beachfront apartment at Rainbow Bay has more than doubled in value since it sold off the plan six years ago, setting a new local apartment record in the process.

The three-bedroom apartment in the Flow development on Petrie Street, the first of four new projects locally by Paul Gedoun's S&amp;S Projects, has sold for $7.4 million, after originally selling for $3.27 million when the project launched in 2020.

The seventh-floor apartment, comprising 187 sqm of internal living space and a 54 sqm balcony overlooking Froggies Beach and Snapper Rocks, was purchased by a local family.

The transaction was negotiated by Pezet Matheson director Kerry Pezet and equates to more than $30,000 per sqm.

Pezet said the sale reflected the limited opportunities to buy into the boutique beachfront development.

"The sale highlights the rarity of opportunities within the boutique beachfront development, where residences seldom become available," Pezet said.

"Flow is one of the Gold Coast's most tightly held buildings. Buyers from our database move quickly when residences become available, and achieving an off-market sale at $7.4 million demonstrates the depth of demand for property of this calibre."

<img alt="Flow" data-entity-type="file" data-entity-uuid="c585b206-2130-4eee-a50c-3f27c51a7c70" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-06%20at%208.33.25%E2%80%AFPM.png?VersionId=m3pHRDV62Y3fvN.XQuQHq.52ilTWpRLf" />

Flow was the first of four luxury apartment developments delivered by Paul Gedoun's S&amp;S Projects at Rainbow Bay and was completed in 2023.

Positioned on the beachfront overlooking Snapper Rocks, the residence includes three bedrooms, three bathrooms, a powder room and views stretching north along the coastline towards Surfers Paradise.

Pezet Matheson Residential principal Mitchell Lambert said buyers continued to prioritise quality beachfront apartments in tightly held locations.

"Flow Residences offers a rare combination of elevated beachfront positioning, architectural excellence, comprehensive resident amenity and premium finishes, which is exactly what discerning purchasers are seeking," Lambert said.

"The transaction further reinforces Rainbow Bay's reputation as one of Australia's premier coastal lifestyle destinations, where limited supply and growing demand continue to support strong market performance."

Pezet Matheson originally marketed and sold out Flow off the plan, making the latest transaction a return to one of the project's original buyers.

Paul Gedoun is selling his third project, <a href="https://www.apartments.com.au/new-apartments/radia-rainbow-bay-271-boundary-street-coolangatta-qld-4225">Radia Rainbow Bay</a>, after recently completing, and selling out, <a href="https://www.apartments.com.au/buildings/esprit-217-227-boundary-street-coolangatta-qld-4225">Esprit</a>. He has plans for a <a href="https://www.apartments.com.au/news/qld/first-look-s-s-projects-proposes-88-apartment-wellness-tower-at-coolangattas-boundary-street">fourth building</a>, 88 apartments on <a href="https://www.apartments.com.au/new-apartments/209-213-boundary-street-coolangatta-qld-4225">Boundary Street</a>.

Rainbow Bay apartment doubles in price since off the plan sale during pandemic

Cameron Kusher

<html><body>
After a long period of soft housing market conditions post the 2008 GFC, we’re seeing a pick-up in housing demand across regions, according to CoreLogic research analyst Cameron Kusher.
Buyers are looking outside the capitals for "more affordable options,” he said after analysis of the 50 most populous non-capital city council areas.
“While a majority of the regions are showing an upward swing, areas linked to the mining and resources sector are continuing to see values fall.”
Of the non-capital city council areas analysed, areas close to Sydney are seeing the strongest growth in New South Wales.
As an example, the Wollongong council area is the most expensive for houses ($730,427) and units ($530,170).
The area also recorded the greatest increase in house values, and now holds the fourth highest increase in unit value over the past year.
“Places like Wollongong are on the rise as demand ripples away from Sydney where affordability constraints are more pressing.”
Regional areas in Victoria which are close to Melbourne are experiencing value growth, however, Mr Kusher said.
“It is nowhere near the magnitude to which values are growing in those locations close to Sydney.”
“Although values are rising, the softer growth can be linked to the fact that values have not risen as sharply in Melbourne as they have in Sydney and subsequently affordability hasn’t deteriorated as severely in Melbourne,” he said.
For Queensland, the results are more mixed with the south-east corner generally seeing values rise, while across the remainder of the state, growth is extremely mild or values have fallen.
Stripping the spotlight from Brisbane, CoreLogic confirmed that the Gold Coast, Sunshine Coast and Noosa are now seeing more rapid value growth than for Brisbane.
“It seems as though much of the demand across these regions is coming from an acceleration in internal migration to Queensland, and where buyers from Sydney and Melbourne are using substantial equity earned to secure lifestyle properties in the state.”
<a href="https://www.propertyobserver.com.au/images/2017/06/22/Screen%20Shot%202017-06-22%20at%2011.42.30%20am.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/06/22/Screen%20Shot%202017-06-22%20at%2011.42.30%20am.jpg" alt="">
Of the areas observed by CoreLogic, each of the 24 regions highlighted in New South Wales have recorded value growth for houses over the past year.
For units, only 4 of the 24 regions have recorded value falls over the past 12 months.
In Victoria, of the 10 regions analysed, two recorded value falls over the year for houses and 2 regions also recorded falls for unit values.
Greater Shepparton was the only council area of the state which recorded value falls for houses and units.
Of the 13 regions highlighted for Queensland, five have recorded value falls for houses over the past year and seven have recorded declines for units.
Each of the regions highlighted in Western Australia have recorded value falls over the past year for houses and units.
Launceston was the only region analysed in Tasmania and it has seen house and unit values rise over the past year.
It should be noted while values have increased they have done so at a more moderate pace than those in Hobart.
Mr Kusher said, “Overall, we’re seeing housing demand in regional areas of the country is rising.
“While many regions are seeing values increase, the strongest demand appears to be in those areas within relatively close proximity to capital cities, particularly those which are coastal and tap into lifestyle demand.”
Cameron Kusher is research analyst for CoreLogic. You can contact him <a href="https://blog.corelogic.com.au/about/">here</a>.
</body></html>

ckusher-ujnxiKuFQs

Regional areas showing home values rising: Cameron Kusher

<html><body>
The mortgage rate lift is starting to be felt, driven largely by Australian mortgage lenders rationing credit to the investor segment, according to CoreLogic's Cameron Kusher.
He said the mortgage rate premium for investors appears to finally be biting into the market with weakness in both total investor credit and investor housing finance commitments.
"April 2017 lending aggregates data from the Reserve Bank (RBA) showed that investor credit rose by 0.55 percent over the month, its lowest monthly increase since August 2016," he said.
<a href="https://www.propertyobserver.com.au/images/2017/06/15/Screen%20Shot%202017-06-15%20at%2011.16.18%20am.jpg" target="_blank" style="font-size: 12.16px;">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/06/15/Screen%20Shot%202017-06-15%20at%2011.16.18%20am.jpg" alt="">
"At the same time, April 2017 housing finance data shows there was $12.6 billion in investor housing finance commitments over the month, the lowest value since September 2016.
"Since August and September of last year, standard variable mortgage rates for investors rose by 30 basis points compared to a 5 basis point increase for owner occupiers.
“There are individual states and territories in where a slowdown in mortgage demand by investors will have more of an impact, namely New South Wales and Victoria.
“Tasmania is the only state or territory where the value of lending to housing investors is currently rising however, in terms of the value of lending to investors, New South Wales and Victoria account for a substantial majority of overall lending.
“This is partly a function of higher housing costs in these two states, nevertheless, New South Wales accounted for 49.3 percent of all investor lending nationally in April 2017 with Victoria accounting for 27.4 percent.
“A pull- back in lending to investors is inherently likely to have more of an impact on the New South Wales (Sydney) and Victorian (Melbourne) housing markets.”
<a href="https://www.propertyobserver.com.au/images/2017/06/15/Screen%20Shot%202017-06-15%20at%2011.16.30%20am.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/06/15/Screen%20Shot%202017-06-15%20at%2011.16.30%20am.jpg" alt="">
"The potential impact on the New South Wales and Victorian housing markets of investor slowdown is further highlighted by the fact that, excluding refinances (which are also trending lower), investors accounted for 55.3 percent of mortgage demand in New South Wales in April 2017 and 46.8 percent in Victoria.
"In all other states and territories, investors accounted for less than 40 percent of mortgage demand in April 2017, with the proportion trending lower over recent months in most regions.
“We anticipate that investor demand will continue to slow over the coming months.
“We’re seeing lenders re-price mortgage rates for investors and, we are yet to see the full impact of the policy changes designed to slow the level of interest-only lending.”
<a href="https://www.propertyobserver.com.au/images/2017/06/15/Screen%20Shot%202017-06-15%20at%2011.17.05%20am.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/06/15/Screen%20Shot%202017-06-15%20at%2011.17.05%20am.jpg" alt="">
"With investor demand likely to fade further, this will also contribute to a further slowing of the rate of value growth in the Sydney and Melbourne housing markets where investor demand has been significantly greater than it has been elsewhere.
“A reduction in the pace of capital gains will add further disincentive to investors.
"We can assume most investors are focussed on the prospects for capital growth and relying on a negative gearing strategy to offset the cash flow losses.”
<a href="https://www.propertyobserver.com.au/images/2017/06/15/Screen%20Shot%202017-06-15%20at%2011.18.23%20am.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/06/15/Screen%20Shot%202017-06-15%20at%2011.18.23%20am.jpg" alt="">
</body></html>

jonathanchancellor-7SQnKwU6yx

Housing investment slowdown has arrived: Cameron Kusher

<html><body>
When we think about the housing market we tend to focus on when values rise but in the recent past values have fallen in each capital city; this week we look at the magnitude and duration of these falls in the past.
Throughout the past 20 years it has been much more common for combined capital city dwelling values to have been increasing than falling. 
Although value rises have been more common, it doesn’t mean that the housing market is bulletproof and in some instances values have fallen quite dramatically and rapidly. 
Typically the Reserve Bank (RBA) or the Government have adjusted fiscal and/or monetary policy to support the housing market and arrest the value falls.
Across the combined capital cities, dwelling values have increased by 346.4% over the 20 years to April 2017. 
In the two periods in which values have fallen, capital city dwelling values fell by -6.1% between March and December 2008 and they fell by -7.4% between October 2010 and May 2012.
<a href="https://www.propertyobserver.com.au/images/2017/06/14/Screen%20Shot%202017-06-14%20at%209.53.45%20am.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/06/14/Screen%20Shot%202017-06-14%20at%209.53.45%20am.jpg" alt="">
At an individual capital city level housing markets have cycled quite differently however, the majority of capital cities recorded a decline in dwelling values in both 2008 and from late 2010/early 2011. 
The 2008 decline occurred as the financial crisis hit with values falling however, stimulus measures in the form of aggressive interest rate cuts along with cash handouts and boosts to first home buyer’s grants proved enough to spur demand and turnaround the decline in values.
<a href="https://www.propertyobserver.com.au/images/2017/06/14/Screen%20Shot%202017-06-14%20at%209.53.56%20am.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/06/14/Screen%20Shot%202017-06-14%20at%209.53.56%20am.jpg" alt="">
In 2010 dwelling values fell as the post financial crisis stimulus was being wound out of the market with interest rates increasing and first home buyer incentives being removed. 
These value falls were arrested as the RBA reversed direction and started to cut official interest rates again in late 2011.
Looking at the declines which commenced in 2008, the magnitude of falls was fairly minor considering most advanced economies fell into recession as a result of the financial crisis. 
Hobart and Darwin were relatively unaffected by the declines however, Melbourne (-8.3%), Perth (-6.8%) and Sydney (-6.2%) were more impacted than all other capital cities. 
The period of decline proved quite short and it has become clear that the stimulus measures effectively staved off sharper declines and possibly a national recession.
<a href="https://www.propertyobserver.com.au/images/2017/06/14/Screen%20Shot%202017-06-14%20at%209.54.07%20am.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/06/14/Screen%20Shot%202017-06-14%20at%209.54.07%20am.jpg" alt="">
From 2010 to 2011/12 all capital cities experienced falls in dwelling values as the financial crisis stimulus and low interest rates were wound out of the market. 
Sydney (-5.0%), Adelaide (-6.9%) and Canberra (-4.4%) were the only capital cities in which values didn’t fall by more than 10% over this period. 
The largest falls were recorded in Darwin (-19.7%), Hobart (-14.3%) and Brisbane (-11.7%). 
Over the period of falls, Darwin (-1.2%) averaged the largest average monthly fall along with Hobart (-0.8%), Melbourne (-0.6%) and Perth (-0.6%). 
Across the other capital cities, Sydney, Adelaide and Canberra recorded average declines of -0.3%/month and Brisbane’s declines averaged -0.5%/month.
<a href="https://www.propertyobserver.com.au/images/2017/06/14/Screen%20Shot%202017-06-14%20at%209.54.19%20am.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/06/14/Screen%20Shot%202017-06-14%20at%209.54.19%20am.jpg" alt="">
This analysis serves as a reminder that although capital city dwelling values have largely increased over the past 20 years, they are not immune from potential declines. 
The impetus for these previous declines have been external economic shocks and the stimulus of low interest rates and grants to first home buyers being removed. 
We aren’t currently seeing any economic shocks of the size of the 2008 financial crisis but we are seeing unemployment rate at similar levels to 2008/09 and historically high levels of underemployment. 
The market is also slowly seeing historic low mortgage rates moving higher against a backdrop of record low wages growth and record high household debt. 
Depending on how much mortgage rates are increased (noting that this is not happening due to the RBA) home owners should be aware that it could lead to a slowing or even some potential falls in dwelling values.
Cameron Kusher is head of research for CoreLogic. You can contact him <a href="https://blog.corelogic.com.au/about/">here</a>.
</body></html>

What happens when house prices start falling? Cameron Kusher

<html><body>
Throughout the past 20 years, CoreLogic research confirmed that it’s been much more common for combined capital city dwelling values to increase rather than fall.
CoreLogic head of research Cameron Kusher said although value rises have been more common, it doesn’t mean that the housing market is bulletproof and in some instances values have fallen quite dramatically and rapidly.
“Typically the Reserve Bank (RBA) or the Government have adjusted fiscal and/or monetary policy to support the housing market and arrest the value falls,” he said.
Today’s CoreLogic research shows that across the combined capital cities, dwelling values increased by 346.4 percent over the 20 years to April 2017.
<a href="https://www.propertyobserver.com.au/images/2017/06/08/Screen%20Shot%202017-06-08%20at%2011.24.55%20am.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/06/08/Screen%20Shot%202017-06-08%20at%2011.24.55%20am.jpg" alt="">
In the two periods in which values have fallen, capital city dwelling values fell by -6.1 percent between March and December 2008 and they fell by - 7.4 percent between October 2010 and May 2012.
At an individual capital city level housing markets have cycled quite differently however, the majority of capital cities recorded a decline in dwelling values in both 2008 and from late 2010/early 2011.
The 2008 decline occurred as the financial crisis hit with values falling however, stimulus measures in the form of aggressive interest rate cuts along with cash handouts and boosts to first home buyer’s grants proved enough to spur demand and turnaround the decline in values.
In 2010 dwelling values fell as the post financial stimulus was being wound out of the market with interest rates increasing and first home buyer incentives being removed.
These value falls were arrested as the RBA reversed direction and started to cut official interest rates again in late 2011.
<a href="https://www.propertyobserver.com.au/images/2017/06/08/Screen%20Shot%202017-06-08%20at%2011.25.06%20am.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/06/08/Screen%20Shot%202017-06-08%20at%2011.25.06%20am.jpg" alt="">
Mr Kusher said looking at the declines which commenced in 2008, the magnitude of falls was fairly minor considering most advanced economies fell into recession as a result of the financial crisis.
“Hobart and Darwin were relatively unaffected by the declines however, Melbourne (-8.3 percent), Perth (-6.8 percent) and Sydney (-6.2 percent) were more impacted than all other capital cities," he said.
“The period of decline proved quite short and it has become clear that the stimulus measures effectively staved off sharper declines and possibly a national recession.”
From 2010 to 2011/12 all capital cities experienced falls in dwelling values as the financial crisis stimulus and low interest rates were wound out of the market.
Sydney (-5.0 percent), Adelaide (-6.9 percent) and Canberra (-4.4 percent) were the only capital cities in which values didn’t fall by more than 10 percent over this period.
<a href="https://www.propertyobserver.com.au/images/2017/06/08/Screen%20Shot%202017-06-08%20at%2011.25.14%20am.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/06/08/Screen%20Shot%202017-06-08%20at%2011.25.14%20am.jpg" alt="">
The largest falls were recorded in Darwin (-19.7 percent), Hobart (- 14.3 percent) and Brisbane (-11.7 percent).
Over the period of falls, Darwin (-1.2 percent) averaged the largest average monthly fall along with Hobart (-0.8 percent), Melbourne (-0.6 percent) and Perth (-0.6 percent).
Across the other capital cities, Sydney, Adelaide and Canberra recorded average declines of -0.3 percent/month and Brisbane’s declines averaged -0.5%/month.
Mr Kusher said this analysis serves as a reminder that although capital city dwelling values have largely increased over the past 20 years, they are not immune from potential declines.
“The impetus for previous declines has been around external economic shocks along with the stimulus of low interest rates and grants to first home buyers being removed," he said.
"Australia is not seeing any of the shocking economic conditions of the size of the 2008 financial crisis.
“We are seeing the unemployment rate at similar levels to 2008/09 and historically high levels of underemployment.”
<a href="https://www.propertyobserver.com.au/images/2017/06/08/Screen%20Shot%202017-06-08%20at%2011.25.22%20am.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/06/08/Screen%20Shot%202017-06-08%20at%2011.25.22%20am.jpg" alt="">
CoreLogic also reported that the market is slowly seeing historic low mortgage rates move higher against a backdrop of record-low wages growth and record-high household debt.
Mr Kusher said depending on how much mortgage rates are increased (noting that this is not happening due to the RBA) home owners should be aware that it could lead to a slowing or even some potential falls in dwelling values.
</body></html>

Falling property prices and the affect it has on the overall market: Cameron Kusher

<html><body>
The latest internal migration data shows that an increasing number of inter-state and intra-state population movements are to either sea change/tree change regions or the outskirts of the capital cities.
Each year the Australian Bureau of Statistics (ABS) publishes data on internal migration across the regions of Australia.
Internal migration data counts the number of residents moving within the state as well as across state borders.
The tables provided within this report show the top and bottom 25 SA4 regions for net internal migration nationally over the 2015-16 financial year.
The first table shows that the Gold Coast saw the most net internal arrivals at 6,428 persons over the year. 
The data series dates back as far as 2006-07 and the net internal arrivals of 6,428 persons is the highest on record and 39.4% higher over the past year. 
It was also the first time since 2006-07 that the Gold Coast had seen the nation’s highest rate of net internal migration.
<a href="https://www.propertyobserver.com.au/images/2017/06/05/Chart-1.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/06/05/Chart-1.jpg" alt="">
Of the top 25 regions for net internal migration over the past year, 13 were located outside of the capital cities; generally in areas either adjacent or close to capital cities. 
These regions were a mix of sea change and tree change type locations.  Interestingly, each of these regional markets has recorded an increase in net internal migration over the year.
The data supports the strong price rises being recorded across many of Australia’s coastal and hinterland regions, especially those within easy commuting distance of the major capital cities.
None of the 12 capital city regions on the top 25 list were inner city areas in which high rise unit development is at unprecedented levels and density is increasing. 
The capital city areas listed are slanted more towards an increase in greenfield development rather higher density new housing.
The second table shows the 25 regions nationally that have recorded the greatest losses from net internal migration over the 2015-16 financial year. 
Sydney’s Inner South West recorded the largest migration away from the area over the year, losing a net 8,747 residents. 
It was actually the 10th consecutive year that Inner South West has recorded the largest greatest loss from net internal migration.
<a href="https://www.propertyobserver.com.au/images/2017/06/05/Chart-2.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/06/05/Chart-2.jpg" alt="">
17 of the 25 regions listed in the second table were located in a capital city market.  The regions listed are generally established areas closer to the city centre. 
These areas are either seeing greater high density new housing development or very little new housing construction. 
The non-capital city markets are characterised as regional and linked to either agriculture or the mining and resources sector.
Looking at the broader capital city and regional markets, net internal migration over the year was strongest into: Regional NSW (11,827), Brisbane (10,149), Regional Vic (8,429) and Melbourne (8,270). 
The net losses from internal migration were greatest for: Sydney (-23,176), Adelaide (-6,088), Regional WA (-4,433) and Perth (-3,270).
Net internal migration to Regional NSW, Melbourne, Regional Vi and Brisbane was the greatest it has been in at least 10 years. 
Meanwhile, net internal migration to Sydney was the lowest since 2011-12 and it was the lowest in at least 10 years to Regional Qld, Adelaide, Perth and Regional WA.
Overall the data indicates that migration is gathering pace in select regions of the country, a number of which are sea change/tree change areas. 
On the other hand, Sydney is increasingly shedding residents to other parts of the country and this is most likely linked to the high cost of housing. 
Coastal, regional areas of NSW and Vic along with Melbourne and Brisbane appear to be significant benefactors of the deteriorating housing affordability in Sydney as an increasing number of people leave the city for more affordable locations.
Cameron Kusher is head of research for CoreLogic. You can contact him <a href="https://blog.corelogic.com.au/about/" target="_blank">here</a>.
</body></html>

It looks as if sea change and tree change is gathering pace: Cameron Kusher

<html><body>
Data released by the Australian Prudential Regulation Authority (APRA) earlier this week has shown that high loan to value ratio (LVR) lending continues to fall indicating new buyers are in many instances using larger deposits. 
The latest authorised deposit-taking institution (ADI) property exposures data for the March 2017 quarter revealed the ongoing trend as a moderate pull-back in the share of new interest-only mortgage lending however, there will be a lot more work to do for lenders in this space.
<a href="https://www.propertyobserver.com.au/images/2017/05/31/Chart-1.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/05/31/Chart-1.jpg" alt="">
The data showed that over the March 2017 quarter there was $89.257 billion in mortgage lending from the ADIs which was the lowest quarterly value of lending since the same quarter last year. 
Of course, part of this is seasonal due to the Christmas / New Year slowdown and lending over the quarter was 9.5 percent higher than the corresponding quarter last year. 
Over the quarter 65 percent of lending was to owner occupiers ($58.009 billion) with the remaining 35 percent ($31.248 billion) to investors. 
The value of lending to owner occupiers was 3.9 percent higher year-on-year while investor lending was 21.7 percent higher.
<a href="https://www.propertyobserver.com.au/images/2017/05/31/Chart-2.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/05/31/Chart-2.jpg" alt="">
There is currently a big focus on interest-only lending with APRA recently announcing policy changes which limit the value of new interest-only lending to less than 30 percent of the flow of total new mortgage lending.
Over the latest quarter, 36.2 percent of the value of total mortgage lending was for interest-only purposes signifying that further rationing of this type of lending is required. 
Although as a proportion of total lending interest-only lending has slowed, the value of this type of lending has increased by 13.8 percent from the same quarter last year. 
Importantly, interest-only lending peaked at 45.6 percent of the value of total new lending over the June 2015 quarter, so as a proportion of total lending it has already fallen substantially but has quite a way further to slow over the coming quarters as lenders work to meet the new 30 percent APRA benchmark by rationing the availability of this type of mortgage.
<a href="https://www.propertyobserver.com.au/images/2017/05/31/Chart-3.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/05/31/Chart-3.jpg" alt="">
Low documentation ($377 million), non-standard ($142 million) and outside of serviceability loans ($1.461 billion) accounted for a cumulative 2.2 percent of new lending over the quarter. 
Although this was an historic low proportion, it should be noted that in value terms, low documentation (+42.5 percent) and non-standard (+21.6 percent) loans have increased over the year while outside of serviceability mortgages are -59.4 percent lower.
<a href="https://www.propertyobserver.com.au/images/2017/05/31/Chart-4.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/05/31/Chart-4.jpg" alt="">
Over the quarter, $6.896 billion in new mortgages written had an LVR of greater than 90 percent. 
This represents the lowest value of new mortgage lending for LVRs above 90 percent since March 2011. 
It also indicates that 90 percent + LVR mortgages accounted for just 7.7 percent of all new mortgages over the quarter which was an historic low proportion. 
If you look at new mortgages with an LVR greater than 80 percent, they accounted for 22.0 percent of lending which is also an historic low. 
This indicates that borrowers are using either larger deposits upon entry to the market or using greater equity in their existing properties.
<a href="https://www.propertyobserver.com.au/images/2017/05/31/Chart-5.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/05/31/Chart-5.jpg" alt="">
According to the data, the average outstanding mortgage balance was recorded at $259,400 at the end of March 2017 which was 0.8 percent higher over the quarter and 3.9 percent higher over the year. 
By loan type, the average outstanding balances were recorded at: $314,100 for loans with an offset facility, $346,100 for interest-only mortgages, $100,100 for reverse mortgages, $193,100 for low-documentation loans and $185,600 for other non-standard loans. 
Other non-standard loans were the only mortgage type to see a fall in outstanding balance over the year, -4.0 percent lower while the average outstanding balance for interest-only mortgages recorded the greatest rise, 4.2% higher.
The reduction in new lending to higher LVR borrowers is encouraging from a risk perspective with borrowers typically utilising larger deposits. 
While the proportion of lending for interest-only purposes has slowed, it has much further to fall over the coming quarters as lenders seek to reign interest-only lending in to less than 30% of the new flow of lending. 
With interest-only lending favoured by investors it may lead to a slowing in demand from this segment. 
Keep in mind that borrowers utilising interest-only mortgages are assessed on their ability to repay a principal and interest loan. 
Given this there is the possibility that the impact on investor demand may be minimal as they choose to just use a principal and interest loan rather than interest-only.
Investors face a broadening range of disincentives in the market, with mortgage rates for investment purposes up more than 25 basis points compared with their low point last year, record low rental yields and overall tighter credit policies from lenders. 
Additionally, there seems to be growing acceptance that the housing market is losing some momentum which is likely to further weigh on investor purchase decisions.
Cameron Kusher is research analyst for CoreLogic. You can contact him <a href="https://blog.corelogic.com.au/about/" target="_blank">here</a>.
</body></html>

High LVR lending is easing up with a further slowdown expected: Cameron Kusher

<html><body>
The never-ending conversations around housing affordability, particularly around how millennials will get a head-start on the property ladder, has seen a whole raft of suggestions thrown at a possible solution.
I have chosen a 25th percentile price for this analysis which reflects prices at the more affordable end of the housing market and is often more representative of the prices at which first home buyers are looking at to enter the market.
Keep in mind certain states have stamp duty exemptions which exist below specific price thresholds.
<a href="https://www.propertyobserver.com.au/images/2017/05/25/Screen%20Shot%202017-05-25%20at%2011.57.46%20am.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/05/25/Screen%20Shot%202017-05-25%20at%2011.57.46%20am.jpg" alt="">
For this analysis, we have assumed that the first home buyer is purchasing at the 25th percentile price for owner occupation.
City x city stamp duty requirements:
<ul>
<li>Sydney - $25,733 for houses and $273 for units</li>
<li>Melbourne - $11,553 for houses and $8,507 for units</li>
<li>Brisbane - $1,043 for houses and $845 for units</li>
<li>Adelaide - $16,046 for houses and $12,622 for units</li>
<li>Perth - $422 for houses and $402 for units</li>
<li>Hobart - $9,302 for houses and $7,266 for units</li>
<li>Darwin - $7,557 for houses and $6,337 for units</li>
<li>Canberra - $15,107 for houses and $8,303 for units.</li>
</ul>
It’s a common misconception that in order to purchase a home you need a 20% deposit.
<a href="https://www.propertyobserver.com.au/images/2017/05/25/Screen%20Shot%202017-05-25%20at%2011.58.03%20am.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/05/25/Screen%20Shot%202017-05-25%20at%2011.58.03%20am.jpg" alt="">
Whilst a 20% deposit is beneficial it is not a necessity however, if you have a deposit of less than 20% most lenders will require you to pay lenders mortgage insurance (LMI).
LMI can be paid up front or capitalised into the loan repayments.
Either way, if a buyer is required to pay LMI, it will result in higher mortgage repayments or a larger up front deposit.
This analysis has made no provision for LMI costs.
<a href="https://www.propertyobserver.com.au/images/2017/05/25/Screen%20Shot%202017-05-25%20at%2011.58.22%20am.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/05/25/Screen%20Shot%202017-05-25%20at%2011.58.22%20am.jpg" alt="">
The cost of the deposit along with the stamp duty in each capital city for deposits of 5%, 10%, 15% and 20%, remembering that the stamp duty cost is fixed so the cost increases highlighted reflect the greater savings required for a larger deposit.
Saving for a deposit, even a 5% deposit, is a much tougher task in Sydney and Canberra than it is elsewhere in the country.
A 5% deposit on a house in Sydney requires $59,033, in Canberra it requires $41,357 while the deposits required for a house in all other capital cities except for Adelaide ($32,921) is less than half of the deposit required in Sydney.
Another challenge for potential first home buyers, particularly in Sydney and Melbourne is that household incomes are not growing at the same pace as dwelling values.
Over the 12 months to April 2017, Sydney dwelling values have increased by 16.0% and Melbourne values are 15.3% higher.
<a href="https://www.propertyobserver.com.au/images/2017/05/25/Screen%20Shot%202017-05-25%20at%2011.58.30%20am.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/05/25/Screen%20Shot%202017-05-25%20at%2011.58.30%20am.jpg" alt="">
Modelled household income data from the Australian National University (ANU) indicates that over the 12 months to March 2017 Sydney household incomes have increased by a comparatively lower 4.6% and Melbourne household incomes are 2.7% higher.
Entry into the housing market remains a real challenge, particularly in our largest and most expensive capital cities.
Even in cheaper areas, household income growth is fairly slow which makes saving a deposit difficult.
It is unclear as to how, absent a big fall in property prices, housing affordability for first home buyers can be greatly improved.
Governments have tried incentives such as grants in the past and they generally just lead to greater demand and higher property prices.
The future onset for the housing affordability challenge over the coming years could potentially create greater social pressures where our youth may look to move away from the commercial hubs of Sydney and Melbourne because housing costs are too high.
<a href="https://www.propertyobserver.com.au/images/2017/05/25/Screen%20Shot%202017-05-25%20at%2011.58.41%20am.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/05/25/Screen%20Shot%202017-05-25%20at%2011.58.41%20am.jpg" alt="">
Added to this, businesses may find it increasingly difficult to attract young talent unless they offer opportunities in areas where housing is more affordable, both from a purchase and rental perspective.
Cameron Kusher is research analyst for CoreLogic. You can contact him <a href="https://blog.corelogic.com.au/about/" target="_blank">here</a>.
</body></html>

How much first home buyers really need: Cameron Kusher

<html><body>
According to the latest housing finance data release for March 2017 there was $33.2 billion in finance commitments over the month. 
The monthly value of commitments increased by 0.9 percent to be 5.3 percent higher year-on-year. 
While the value of commitments to investors has slowed over recent months, owner occupier demand lifted slightly in March 2017.
<a href="https://www.propertyobserver.com.au/images/2017/05/24/chart-1-2.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/05/24/chart-1-2.jpg" alt="">
The data shows that in March 2017, the $33.2 billion in housing finance commitments comprised of $20.2 billion to owner occupiers and $13.0 billion to investors. 
The value of owner occupier commitments increased by 0.9 percent over the month to be at its highest level since June 2016. 
Investor demand also rose over the month, up 0.8 percent however, it remains well below levels from a few months ago. 
Looking at recent monthly data it suggests that demand from owner occupiers has been reasonably steady while the level of demand from investors has eased. 
Keep in mind that this data pre-dates the most recent policy announcement from APRA; over the coming months there are likely to be a number of headwinds for investors in the form of: higher mortgage rates, reduced availability of interest-only lending and changes to depreciation benefits for plant and equipment on investment property for new purchases. 
Given this we would expect that investor demand is likely to fall further over the coming months.
<a href="https://www.propertyobserver.com.au/images/2017/05/24/chart-2-2.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/05/24/chart-2-2.jpg" alt="">
Owner occupier demand continues to be fueled by purchases of established housing stock while refinance activity continues to fade. 
The $20.2 billion in housing finance commitments to owner occupiers consisted of $1.8 billion for construction of dwellings, $1.1 billion for purchase of new dwellings, $6.1 billion for refinancing of established dwellings and $11.1 billion for purchase of other established dwellings. 
The value of lending for construction and purchase of new dwellings has remained at fairly consistent levels over the past year and a half. 
The value of refinancing has been trending lower since it peaked in December 2015 and it is now at its lowest level since July 2015. 
At the same time, demand for purchases of established dwellings is trending higher and is at its highest level since September 2015.
<a href="https://www.propertyobserver.com.au/images/2017/05/24/chart-3-2.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/05/24/chart-3-2.jpg" alt="">
Mortgage demand from investors overwhelmingly comes from investors buying established housing rather than new housing. 
The $13.0 billion worth of commitments in March 2017 consisted of $1.1 billion from construction of dwellings and $11.9 billion from established housing. 
The $1.1 billion in commitments for construction was 6.1 percent higher over the month while the $11.9 billion for established housing is 0.3 percent higher over the month. 
The value of lending for investors for established housing is now down -4.6 percent from its most recent peak two months ago and -12.5 percent lower than its historic peak in April 2015.
<a href="https://www.propertyobserver.com.au/images/2017/05/24/chart-4-2.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/05/24/chart-4-2.jpg" alt="">
Comparing established housing to new housing continues to show that the bulk of housing demand is coming from established housing stock. 
Over the month, 85 percent of mortgage demand (excluding refinances) was for established housing stock ($23.0 billion) with the remaining 15 percent ($4.0 billion) for new housing stock.
The data is pointing to ongoing weaker demand from the investor segment of the market and refinances from owner occupiers slowing while demand from owner occupiers for established housing stock is trending higher. 
With the lending environment continuing to change, particularly for investors, we would expect that demand from investors will continue to wane. 
Higher interest rates, the rationing of the availability of interest-only lending and reduced negative gearing benefits is likely to weigh on investor demand over the coming months.
Cameron Kusher is research analyst for CoreLogic. You can contact him <a href="https://blog.corelogic.com.au/about/">here</a>.
</body></html>

Investor mortgage demand continues to wane: Cameron Kusher

<html><body>
The flow-on effect of a commodity price slump a few years back saw property prices crash in most of Australia’s mining towns, according to CoreLogic’s latest Property Pulse.
Cameron Kusher, CoreLogic head of research, said prices and rents slumped by as much as 60 percent in certain markets, adding there’s some good news on the horizon, with many of mining towns seeing sales volumes lift where there are signs that the rate of decline in house prices are starting to slow.
“History shows that mining booms don’t last forever and it would be difficult to find anyone that could suggest the house prices in many of these towns were sustainable during the boom," he said.
"At the time, prices were being driven higher by a temporary influx of residents on high incomes and therefore, creating greater housing demand at a time in which supply which was largely irresponsive which drove prices to record high levels.
"As the demand subsided supply was beginning to increase which led to substantial falls in both prices and sales.”
Gladstone – 578 sales over the past year at a median price of $323,875. Sales volumes are 68 percent lower than their July 2007 peak and median prices are 32 percent lower than their September 2012 peak.
<a href="https://www.propertyobserver.com.au/images/2017/05/18/Screen%20Shot%202017-05-18%20at%2010.57.00%20am.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/05/18/Screen%20Shot%202017-05-18%20at%2010.57.00%20am.jpg" alt="">
Mackay – 1,216 sales over the past year at a median price of $335,000. Sales volumes are 63 eprcent lower than their April 2004 peak and median prices are 23 percent lower than their June 2013 peak.
<a href="https://www.propertyobserver.com.au/images/2017/05/18/Screen%20Shot%202017-05-18%20at%2010.57.10%20am.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/05/18/Screen%20Shot%202017-05-18%20at%2010.57.10%20am.jpg" alt="">
Isaac - 198 sales over the past year at a median price of $140,000. Sales volumes are 70 percent lower than their March 2012 peak and median prices are 77 percent lower than their November 2012 peak.
<a href="https://www.propertyobserver.com.au/images/2017/05/18/Screen%20Shot%202017-05-18%20at%2010.57.19%20am.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/05/18/Screen%20Shot%202017-05-18%20at%2010.57.19%20am.jpg" alt="">
Port Hedland - 204 sales over the past year at a median price of $300,000. Sales volumes are 49 percent lower than their July 2006 peak and median prices are 67 percent lower than their June 2013 peak.
<a href="https://www.propertyobserver.com.au/images/2017/05/18/Screen%20Shot%202017-05-18%20at%2010.57.34%20am.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/05/18/Screen%20Shot%202017-05-18%20at%2010.57.34%20am.jpg" alt="">
Karratha - 289 sales over the past year at a median price of $285,000. Sales volumes are 44 percent lower than their March 2005 peak and median prices are 65 percent lower than their October 2010 peak.
<a href="https://www.propertyobserver.com.au/images/2017/05/18/Screen%20Shot%202017-05-18%20at%2010.57.46%20am.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/05/18/Screen%20Shot%202017-05-18%20at%2010.57.46%20am.jpg" alt="">
Roxby Downs - 31 sales over the past year at a median price of $225,000. Sales volumes are 83 percent lower than their December 2003 peak and median prices are 55 percent lower than their October 2013 peak.
<a href="https://www.propertyobserver.com.au/images/2017/05/18/Screen%20Shot%202017-05-18%20at%2010.57.57%20am.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/05/18/Screen%20Shot%202017-05-18%20at%2010.57.57%20am.jpg" alt="">
Cameron Kusher said while each of these markets has recorded a significant fall in sales and selling prices over recent years, more recently each market has started to see sales rise.
“While this result is unlikely to represent demand substantial enough to drive prices higher, it may be enough to slow or stop the declines in prices in the short to longer term.
"It’s also important to remember that it’s not as if there is no demand for housing in these towns, it’s just substantially lower than it was during the mining boom.
"Anyone looking to purchase now is securing a property at a substantial discount from previous highs however, these towns also continue to achieve some of the best rental returns based on current pricing and rents.”
"While I expect very little prospects for capital growth over the coming years, investors looking for a passive income may be becoming more attracted to these markets which could explain the recent uptick in sales."
</body></html>

Gladstone still down 32 percent, but buyer demand moves off the floor in mining regions: Cameron Kusher

<html><body><div title="Page 1">
<div>
<div>
<div>
Based on the relationship between demonstrated housing demand and advertised stock levels we are seeing relatively more stock available for sale compared to demand for that stock across the capital cities at the moment.
The months of supply figure compares the number of unique properties advertised for sale to the number of transactions in the market. The analysis provides unique insight into how long it should take to clear the volume of stock currently available for sale. It is important to note that off-the-plan housing stock is typically not advertised for sale as individual properties and as a result is not included within this analysis.
Across the combined capital cities, there is currently 4.4 months’ worth of residential properties being advertised for sale. As the first chart shows, the months of supply is currently higher at this point of the year than it has been each year since 2012. The increasing months of supply is largely due to the slowing rate of transaction activity rather than a spike in properties available for sale, indicating demand has diminished relative to advertised supply levels which is pushing the figure higher. <a href="https://www.corelogic.com.au/resources/property-pulse/article-graphs-img/2017-05-15--image1.jpg" target="_blank">Click to enlarge</a>
<img src="https://www.urban.com.au/images/2017/05/19/rsz_kusherchart.png" width="700" height="425">
Sydney – there is currently 3.0 months of established housing supply available for sale across the city. The city has seen consistently low months of supply over recent years however, the figure is currently at its highest level for this time of year since 2012.
Melbourne – established housing stock currently sits at 4.2 months of supply for the city. Supply levels remain quite low but are at their highest levels for this time of year in five years.
Brisbane – the city currently has 5.1 months of established housing stock available for sale. The months of supply figure is higher than it has been at this time of year for each of the past five years.
Adelaide – there is currently 3.7 months of established housing stock available for sale. Although stock levels are higher than they were at this time over the past two years, stock levels were higher over the three years previous to that.
Perth – at the moment there is 8.3 months of established housing stock available for sale throughout the city. This is a high months of supply figure relative to other capital but it is well down on the 8.7 months at the same time last year.
Hobart – the months of supply figure for Hobart is the lowest it has been for many years. There is currently 4.1 months’ worth of established stock available for sale which is down from 5.0 months a year ago and the 7.2 months the year previous.
Darwin – across the city there is currently 6.7 months of established housing supply which is well down on the 10.5 months at the same time a year ago and 7.5 months over the previous year.
Canberra – there is currently 2.6 months of supply of established housing stock for sale in Canberra. The months of supply level is the same as what it was a year ago but lower than the previous years highlighted.
Based on these figures it seems that the supply of stock for sale relative to demand is increasing in Sydney, Melbourne and Brisbane. Meanwhile demand is outweighing supply in Hobart and Canberra leading to a decline in the months of supply. In Perth and Darwin supply continues to dramatically outweigh demand but the balance is slowly improving. In Adelaide there has been little change in months of supply over recent years suggesting the market is in relative equilibrium.
Cameron Kusher is a research analyst for CoreLogic. You can contact him <a href="https://blog.corelogic.com.au/about/" target="_blank">here</a>.
</div>
</div>
</div>
</div></body></html>

Cameron Kusher

Editor's Picks

Have something to contribute?

Developments

New apartments

New townhouses

News

Cameron Kusher

Editor's Picks

Receive the latest news stories to your inbox

Have something to contribute?

Developments

New apartments

New townhouses

News