The residential transformation of St Kilda Road is set to continue into with more new apartment plans for the sought-after boulevard.

Wing Tai Asia has lodged plans for a major residential tower at 464-466 St Kilda Road, replacing the former VACC House with an 18-storey mixed-use development designed around a retained heritage podium and a sculpted contemporary tower.

The proposal, prepared under Victoria’s Significant Residential Development with Affordable Housing pathway, would deliver 325 apartments and ground-floor retail across the prominent 4,653 sqm boulevard site in Melbourne’s St Kilda Road North Precinct.

The project centres on the adaptive reuse of the site’s heritage-listed VACC Building, an eight-storey office designed by Bernard Evans that has occupied the address for decades. Planning documents state the development would involve “carefully dismantling and conserving off-site the original metal fabric of the podium visible from St Kilda Road,” before reinstating it as the defining frontage of the new scheme.

Above the restored podium, Wing Tai is proposing a curvilinear residential tower. The scheme includes 172 one-bedroom apartments, 63 two-bedroom apartments, 66 three-bedroom apartments, and 24 four-bedroom apartments, alongside two ground-floor food and beverage tenancies fronting St Kilda Road.

The tower has been designed with substantial articulation and variable setbacks to minimise perceived bulk and maintain view corridors along the boulevard. Urbis, which prepared the planning report, said the design “has been significantly articulated through a curvilinear design” with “an interplay with materials, façade expression and depth” to create visual separation and visual interest.

The proposal also includes 254 basement car spaces, landscaped pedestrian links connecting St Kilda Road and Queens Lane, and a biophilic landscape strategy featuring canopy trees, raised planters, cascading greenery and a glass oculus pool overlooking the eastern frontage.

Planning documents confirm the $270.1 million development will contribute 3 per cent of project costs to the Social Housing Growth Fund as part of the application process.

Wing Tai acquired the St Kilda Road property in 2018 alongside Abacus Property Group for $95.38 million, before later consolidating ownership of the site. The property previously served as the Victorian Automobile Chamber of Commerce headquarters for around 60 years.

The transformation of the St Kilda Rd boulevard is already beginning to materialise, with a number of high-profile projects recently completed, launched, or approaching launch as developers continue to back the long-term appeal of the precinct.

Among the most notable recent completions is Louise by Samuel Property Group, just off the strip on Queens Lane, the same pocket Hirsch &amp; Faigen recently launched The Queensbury. Mirvac is too on the same street with The Albertine, which is approaching completion.

Dexus recently secured approval for its slice of St Kilda Road, while Gurner also has approved plans for the precinct.

Joel Robinson

Wing Tai unveils 325-apartment St Kilda Road tower on former VACC House site

Malaysian developer <a href="https://www.apartments.com.au/developers/s-p-setia">SP Setia</a> is the latest to jump into St Leonards booming Transport Oriented Development precinct.

The developer, which has previously delivered Sapphire by the Gardens apartment development in Melbourne, identified the Atchison Street site in 2023. It filed a Scoping Report around 12 months ago, and now has revealed the designs for the new&nbsp;40-storey mixed-use tower.

The State Significant Development Application covers <a href="https://next-portal.urban.com.au/projects/14650/summary">20-22 Atchison Street</a>, a 1,374 sqm site positioned between St Leonards Station and the new Crows Nest Metro station.

Designed by <a href="https://www.apartments.com.au/architects/cox-architecture">COX Architecture</a>, the project would deliver 181 apartments, above a four-storey commercial podium, five basement levels, and new public domain works along Mitchell Street. The apartment mix comprises 35 one-bedroom apartments, 39 one-bedroom-plus-study apartments, 85 two-bedroom apartments, and 22 three-bedroom residences.

The proposal has been lodged as a shop-top housing development under the NSW Government’s TOD planning pathway, which allows increased density around key transport infrastructure. The site sits within the recently rezoned Crows Nest Accelerated TOD Precinct.

<img alt="First look: SP Setia targets St Leonards skyline with 40-storey TOD tower" data-entity-type="file" data-entity-uuid="b799673d-48e2-46b0-801a-0e33a9330100" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/atchinson%20site.png?VersionId=dPh0UfwfaHpbFL1R7H1cbZNbIW0CHbCC" />

SP Setia acquired the Atchison Street site as part of its continued expansion into the Australian apartment market. In comments made to City &amp; Country (The Edge Malaysia) in 2023, SP Setia President and CEO Datuk Choong Kai Wai described the acquisition as “a strategic move” aligned with the group’s post-pandemic market recovery strategy.

“Our target for this exceptional development is local and overseas buyers, including first-home buyers, downsizers and investors,” Choong said.

The tower has been designed as a slender vertical form rising from a mixed-use podium, with COX Architecture positioning the development as a response to the evolving St Leonards and Crows Nest skyline.

“The purpose of the project is to facilitate the delivery of high-quality housing at a strategically located site and deliver a built tower outcome that is consistent with the desired future character of St Leonards and aligns with the TOD controls,” the design report stated.

<img alt="First look: SP Setia targets St Leonards skyline with 40-storey TOD tower" data-entity-type="file" data-entity-uuid="b1a85eee-76f7-436c-a6da-73ba827b9b13" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/atchinson%20entry.png?VersionId=dA9jHGPMcm.dDbwk4QfxqWiY5bfh3UVt" />

The podium would incorporate retail uses fronting Atchison Street, commercial tenancies, landscaped communal areas, and pedestrian improvements along Mitchell Street. Vehicle access and loading would be consolidated via Atchison Lane.

Residents would have access to more than 665 sqm of communal indoor and outdoor spaces, while the development proposes 96 parking spaces across five basement levels.

The proposal also includes a commitment for 10 per cent of residential floor space to be allocated toward affordable housing through a monetary contribution.

COX said the tower form responds directly to the emerging high-density character of the precinct while seeking to maximise solar access, cross ventilation, and outlook from apartments.

<img alt="First look: SP Setia targets St Leonards skyline with 40-storey TOD tower" data-entity-type="file" data-entity-uuid="2163f85c-f63b-4be3-aafa-f8763976cec5" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Article%20Feature%20Image%20%28Grid%29_5.png?VersionId=WiAmtIKJ6.ZQ41EtYEQ1fol7AeorKBlL" />

“The building is orientated towards north,” the Apartment Design Guide compliance report noted, adding that the tower’s slim form was driven by the constrained inner-urban site dimensions.

The design also incorporates landscaped setbacks and communal open space at podium level, intended to soften the interface with surrounding streets and improve pedestrian amenity.

The project adds to a growing wave of redevelopment proposals reshaping St Leonards and Crows Nest following the opening of the Sydney Metro City line and the NSW Government’s push for higher-density housing around major transport nodes.

Last week Stockland filed plans just down the road. They want to build a <a href="https://www.apartments.com.au/new-apartments/601-pacific-highway-st-leonards-nsw-2065">52-storey tower on Pacific Highway</a>.

Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/first-look-stockland-plans-52-storey-538-apartment-st-leonards-tower">First look: Stockland plans 52-storey, 538-apartment St Leonards tower&nbsp;</a>

First look: SP Setia targets St Leonards skyline with 40-storey TOD tower

<a href="https://www.apartments.com.au/developers/urban-property-group">Urban Property Group</a> has revealed plans for a new mixed-use tower at 10 Dangar Street, Wickham, advancing a proposal that would reshape the southern gateway to Newcastle’s city centre with one of the city’s tallest residential buildings.

The State Significant Development proposal, now on exhibition, seeks approval for a <a href="https://www.apartments.com.au/new-apartments/bowline-10-dangar-street-wickham-nsw-2293">43-storey tower</a> immediately adjacent to the Newcastle Interchange. The project would deliver around 200 apartments, including 42 affordable housing dwellings, alongside 99 co-living units, a 171-room hotel, retail space, and new public domain integrated through the site.

The scheme marks a significant escalation of plans previously approved for the site. Urban Property Group took over the prominent 2,904 sqm parcel, where excavation and demolition had already commenced under an earlier consent for a 14-storey mixed-use development.

<img alt="First look: Urban Property Group unveils Newcastle’s next supertower at Wickham interchange" data-entity-type="file" data-entity-uuid="58a96dd9-407f-4d20-86b4-94e4bfeef74b" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/wickham%20podium.png?VersionId=LGlf08pdFGAZDzvx_CXC4XakHNZRuEE0" />

Designed by <a href="https://www.apartments.com.au/architects/sjb-architects">SJB</a>, the tower has been conceived as a landmark transit-oriented development anchored to the Newcastle Interchange precinct. The proposal includes 245 build-to-sell apartments across a mix of one, two, and three-bedroom residences, as well as two penthouses. Fifteen apartments and one operational unit are earmarked for NDIS housing. The co-living component would add a further 99 units, while the podium would accommodate retail uses and hotel facilities.

SJB said the site presents “a valuable opportunity to anchor the precinct by setting the standard for design, active ground planes and character at the key southern gateway.”

The architecture responds directly to the site’s position beside major transport infrastructure and within one of Newcastle’s fastest-evolving urban renewal precincts. The tower form sits above a sculpted podium designed to frame new public spaces, including a through-site pedestrian link connecting Station Street to Hannell Street, landscaped plazas, and activated retail edges.

<img alt="First look: Urban Property Group unveils Newcastle’s next supertower at Wickham interchange" data-entity-type="file" data-entity-uuid="a7bd6ff0-f7db-4ce8-a6dc-ea56e72c6149" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/wickham%20lanne.png?VersionId=xzf39VADyhj7zBQY2I9fx9vI62u2tuSb" />

The design report describes the project as part of the broader transition of Wickham into “a vibrant, high-quality mixed-use urban precinct” that leverages proximity to the station, open space, and regional connectivity.

A detailed public art strategy has also been prepared for the development. The strategy positions the project as “a transit-oriented development of state significance at the gateway to Newcastle’s city centre” and outlines a series of integrated artworks responding to Newcastle’s industrial and transport heritage.

Creative Road’s curatorial framework for the project, titled Unveil, draws on “stratified surfaces, carved volumes, and light-filled apertures” while referencing Newcastle’s transformation from an industrial city into a contemporary education and technology hub.

<img alt="First look: Urban Property Group unveils Newcastle’s next supertower at Wickham interchange" data-entity-type="file" data-entity-uuid="77a882bb-14b1-4d28-99ff-9438e39508c0" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/wickham%20site.png?VersionId=cevgo_vN0eKPK78P8YcEu3mKPLkpFqE7" />

The proposal is being advanced through the NSW Housing Delivery Authority pathway after being declared State Significant Development in June 2025. The accompanying scoping report states the development aims to “maximise the site’s proximity to the Newcastle Interchange by delivering transit-oriented development” while increasing housing supply and affordable housing provision within the Newcastle LGA.

Urban Property Group’s plans align with the long-term strategic vision established under the Wickham Master Plan, which identified the interchange precinct as suitable for substantial uplift in height and density. The current proposal would significantly intensify that vision, positioning the tower among the tallest developments proposed for Newcastle.

The site sits immediately north of the Newcastle Interchange, bounded by Dangar Street, Hannell Street, and Charles Street. It is surrounded by a rapidly growing cluster of residential towers and mixed-use projects that have emerged following the completion of the light rail and transport interchange.

First look: Urban Property Group unveils Newcastle’s latest tower at Wickham interchange

Bottega House has completed settlement of a landmark riverfront site in Macquarie Street, St Lucia, representing its first major Brisbane development.&nbsp;

Positioned on the banks of the Brisbane River, the <a href="https://www.apartments.com.au/new-apartments/180-macquarie-street-st-lucia-qld-4067">premium site at 180 Macquarie Street</a> features uninterrupted river frontage in one of Brisbane’s most tightly held residential precincts.&nbsp;

The proposed development, currently under assessment with Brisbane City Council, has been designed by <a href="https://www.apartments.com.au/architects/plus-studio">Plus Studio</a> with interiors by <a href="https://www.apartments.com.au/interior-designers/mim-design">Mim Design</a> and will deliver a boutique collection of premium residences positioned specifically for owner occupiers and downsizers.&nbsp;

The residences are set to redefine luxury apartment living in the area, with a focus on architectural quality, refined finishes, landscape integration and elevated amenities including curated wellness facilities, resort-style pools and recreation spaces rarely seen in the local market.&nbsp;

Exclusive sales for the project will be led by Keenan &amp; Byrne, ahead of an anticipated launch later this year.&nbsp;

Bottega House Managing Director Nick Malloch said the project reflects the group’s ambition to deliver a highly curated residential offering within one of Brisbane’s most tightly held precincts.&nbsp;

“This is an incredibly rare riverfront opportunity and one we have approached with a long-term perspective,” Malloch said.&nbsp;

“Our vision from the outset was to create a boutique collection of residences that feel more like private homes than traditional apartments, with generous proportions, refined finishes and exceptional amenity throughout."

Malloch says there is a&nbsp;lack of premium owner-occupier stock of this quality in the market, particularly for downsizers wanting space, privacy and a true lifestyle offering without compromise.&nbsp;

"Demand is expected to be strong given the scarcity of premium riverfront opportunities of this nature within Brisbane’s inner-west."&nbsp;

Bottega House secures landmark riverfront site in St Lucia 

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The arrival of the first piling rig officially marks the commencement of construction at SIERA’s new beachside apartment development, Exhale, in Northcliffe.

<a href="https://www.apartments.com.au/new-apartments/exhale-surfers-paradise-8-enderley-avenue-surfers-paradise-qld-4217">Exhale</a>, a glass-encased tower featuring 54 large-scale apartments at 8 Enderley Avenue, is SIERA’s third Gold Coast development. It follows the recently completed PIPIS Bilinga beachfront project, which achieved suburb-record prices, and the soon-to-be-completed Chevron Island development, Tapestry.

[smartcode_project:default project_id=112661 project_image_fid=359603]

<a href="https://www.apartments.com.au/developers/siera">SIERA</a> Founder and Managing Director Brent Thompson said the arrival of the piling rig represented a significant milestone for the development, which is scheduled for completion in late 2028.

Over the next month, around 260 piles are expected to be installed as work progresses on the basement structure. The building is anticipated to rise above ground level early next year, before unveiling its sculptural glass curtain wall, developed in collaboration with specialist façade engineers.

“The façade was designed to maximise panoramic coastal views while creating a distinctive architectural identity,” Thompson said.

[smartcode_project:default project_id=112661 project_image_fid=355935]

Designed by BDA Architecture, Exhale will comprise just 54 two- and three-bedroom residences across 26 levels, a level of low-density living rarely delivered in this beachside pocket between Surfers Paradise and Broadbeach.

The project has been conceived as a resident-only building, with no short-stay accommodation permitted. SIERA says the model is intended to appeal to long-term owner-occupiers rather than transient holiday demand.

[smartcode_project:default project_id=112661 project_image_fid=361052]

Residences have been designed with large-format layouts and expansive glazing, with most apartments featuring more than 30 metres of glass frontage to maximise natural light and ocean views.

The amenity offering spans two levels and centres on wellness and lifestyle, including a heated magnesium pool, sauna, yoga and Pilates studio, gymnasium, private dining facilities, cinema lounge, and dedicated surfcraft storage.

[smartcode_project:default project_id=112661 project_image_fid=359607]

More than half of the apartments have already sold. SIERA has also opened a sales gallery for Exhale at its Chevron Island commercial premises, near its Tapestry tower and the site of its second Chevron Island apartment development, which is slated to launch in early 2027.
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[smartcode_project_cta:default project_id=112661]

SIERA kicks off construction at Northcliffe tower Exhale

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CBA, the nation's largest mortgage lender, is axing residential and commercial loans for self managed super funds (SMSF).
The bank will be withdrawing its SMSF lending product, SuperGear, from October 12.
Westpac Group, the nation's second largest mortgage lender, already pulled out of the sector in July.
But the Australian Financial Review said the move had shocked mortgage brokers and financial advisers. 
"We are seeing the writing on the wall for leveraged SMSFs," said Sally Tindall, director of research for RateCity, which monitors rates for financial service products. 
"This calls into question the viability of the leveraged SMSF sector."
"CBA has decided to withdraw its SMSF lending product that allows SMSF trusts to purchase both residentially and commercially secured properties," a spokesman said.
"This is part of our strategy to become a simpler, better bank.
"We are streamlining our product portfolio and have decided to discontinue SuperGear."
The bank said it will be writing to customers who hold a SuperGear loan outlining the changes.
It will continue to support existing loan accounts.
Regulators fear problems arising from SMSF investors leveraging their superannuation to invest in a single residential property because of the lack of diversification and increasing dangers of loss in a falling property market where it is difficult to find tenants. 
A key finding of the David Murray-led financial system inquiry in 2014 was that leverage should be banned in superannuation funds to mitigate the risk of financial instability.
The government rejected his advice.
Nearly $700 billion is held in SMSF funds by more than one million investors.
During the past four years the number of members investing in property has increased from about 3.6% to 6.9% of SMSF fund assets.
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j.ballantyne1990-6AQqhLzZaK

Leveraged SMSF sector in doubt as CBA scraps SMSF lending

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Australia’s property market isn't going to crash, according to the Commonwealth Bank economist Gareth Aird.
Nor even a hard landing, but something not too dissimilar to the corrections of 2010 and 1989, he said.
But he has forecast that house prices in Sydney and Melbourne will continue declining until the end of next year.
“We (CBA) see the peak to trough being around 10% in Sydney and a little less in Melbourne (8.8%)," he told Business Insider.
Click <a href="https://edge.alluremedia.com.au/uploads/businessinsider/2018/09/CBA1.jpg" target="_blank">here</a> to enlarge
<div>
<img src="https://edge.alluremedia.com.au/uploads/businessinsider/2018/09/CBA1.jpg" alt="">Source: Commonwealth Bank
</div>
Aird’s model is calculated as a function of the four variables listed below.
1. Annual changes in mortgage rates (1 year advanced);
2. The annual change in the flow of credit (six months advanced);
3. Auction clearance rates (four months advanced);
and 4. The house price expectations index from the Westpac/Melbourne Insitute consumer sentiment survey (2 months advanced).
He concedes that “predicting property prices can look foolish retrospectively”.
However, the chart below shows that the four leading indicators outlined above track actual movements in house prices “very well”.
<div>
<img src="https://edge.alluremedia.com.au/uploads/businessinsider/2018/09/CBA2.jpg" alt="">Source: Commonwealth Bank
</div>
“Clearly, we can’t forecast auction clearance rates or the household perception around the future path of dwelling prices.”
CBA’s base case is that Sydney home prices will decline by 5% annually in 2018 — a relatively mild assessment given the latest weekly data from CoreLogic Sydney house prices are currently 5.9% lower than this time last year.
That would take overall declines from Sydney’s July 2017 peak to around 7.5%.
“For Melbourne, prices would be down by around 5% from their November 2017 peak,” Aird said.
“Nationally, we think prices will end the year down by around 3% with a roughly similar outcome likely in 2019."
Aird noted the broader economy outside of housing is still performing well, along with the continued strength in Australia’s labour market.
He expects the unemployment rate will decline further which lowers the risk of mortgage defaults.
There’s Australian rate of population growth, he added.
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CBA's Gareth Aird forecasts 10 percent decline in Sydney house prices into 2019

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EXPERT OBSERVER
The Commonwealth Bank of Australia reported its full year results last week.
<div>Cash profit for FY2018 of $9.41 billion was down 4.7 per cent. </div>
<div> </div>
<div>But overall this remained a solid underlying result with a fully franked dividend of $4.31 per share heading the way of investors (up 2 cents or +0.5 per cent...thanks!). </div>
<div> </div>
<div>Increased funding costs impacted net interest margins adversely as expected.</div>
<div> </div>
<div>However, the group more than made these costs back in the financial year through changes in the funding mix and the repricing of investor and interest-only loans.</div>
<div> </div>
<div>In fact, the net interest margin was up 5bps over FY2018 to 2.15 per cent.</div>
<div> </div>
<div>Group loan impairment expense was also very low, at just 15bps.</div>
<div> </div>
<div>Note that the Group will adopt AASB 9 from 1 July 2018, and therefore total provisions will increase to reflect forward-looking factors as required by the standard (this adjustment will will pushed through opening retained earnings and therefore will have no impact on the current year income statement). </div>
<div> </div>
<div>'As if' earnings</div>
<div> </div>
<div>A number of one-off items including the $700 million AUSTRAC penalty reduced the statutory NPAT and cash NPAT.</div>
<div> </div>
<div>Excluding one-off items, cash profit was up by 3.7 per cent to above $10 billion.</div>
<div> </div>
<div>From the slide deck</div>
<div> </div>
<div>There were so may great slides in the full year preso that's it's impossible to know where to start, but here are just a select few. </div>
<div> </div>
<div>90+ day home loan arrears were notably up a bit year-on-year from 0.6 per cent to 0.7 per cent. </div>
<div> </div>
<div>Click to enlarge</div>
<div> </div>
 
<div><img src="https://2.bp.blogspot.com/-NikJ1XTC2aM/W2obenRu8FI/AAAAAAAAra0/Bu_BuRukzkwr3D1deQO6h0gvC7zNKaT1ACLcBGAs/s640/CBA1.jpg" width="640" height="510" data-original-height="646" data-original-width="810"></div>
 
<div>(Source: ASX: CBA)</div>
 
<div>The year-on-year increase in arrears was mainly due to Western Australia and the Northern Territory, with changes elsewhere relatively benign. </div>
 
<div><img src="https://3.bp.blogspot.com/-BPTlAOXy52Q/W2obesMjuDI/AAAAAAAAraw/-PYHhx5N81AQ0yr6tGOyTwhmdVcTyqm9gCLcBGAs/s640/CBA3.jpg" width="640" height="374" data-original-height="738" data-original-width="1257"></div>
 
<div>The switching of interest-only (IO) loans peaked in September 2017. </div>
<div> </div>
<div>There is still plenty of scheduled IO expiry over the next two financial years, however, with the blue bars arguably representing the loans most at risk of arrears (being IO loans to investors). </div>
 
<div><img src="https://1.bp.blogspot.com/-oV4exYg2jIY/W2obf3MIo_I/AAAAAAAAra8/NGaVAzwTFF8L3X27_sdVCv1GdNukH2T6wCLcBGAs/s640/CBA4.jpg" width="640" height="276" data-original-height="643" data-original-width="1490"></div>
 Home loan repayments in advance remain popular, though not for all borrowers. 
<div><img src="https://3.bp.blogspot.com/-zmTCKRUK6YA/W2ocvV3VTBI/AAAAAAAArbY/bIkgLBE06_Ak3f32pJmK2CLHaDUB__-mgCLcBGAs/s640/CBA7.jpg" width="640" height="330" data-original-height="750" data-original-width="1454"></div>
 
<div>Finally, CBA optimistically notes that outside recessions or global financial crises modern housing downturns generally only last about 8 months on average (so on that basis, this one should be about done).</div>
 
<div><img src="https://3.bp.blogspot.com/-baZfqx1F2yk/W2obgIOcIrI/AAAAAAAArbE/cfkEW3UjyasvCcohNfaoPV3nTBFD9zsgwCLcBGAs/s640/CBA6.jpg" width="640" height="330" data-original-height="796" data-original-width="1536"></div>
 PETE WARGENT is the co-founder of AllenWargent property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank">blogger</a>.
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pwargent-M4siyDbqQY

WA home loan arrears still problematic for CBA: Pete Wargent

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The Commonwealth Bank of Australia has posted a full-year cash profit of $9.233 billion, down some 4.8 percent.
The last time the bank posted a weaker profit was in 2009.
The result includes $400 million in regulatory costs. The decline was mostly driven by a $700 million penalty paid to AUSTRAC after it breached anti-money laundering laws.
CEO Matt Comyn said the results concluded what had been "a difficult 12 months" for the bank.
"I wanted to start by thanking all of our people right throughout the business who have worked incredibly hard in challenging circumstances to deliver a result of $9.2 billion, which at a headline level is down 4.8 percent, although there has been a number of one-off items that have impacted the result, including a couple of large penalties that we have resolved," said Comyn.
"If you strip some of those out, actually the result looks more from an underlying perspective up 3.7 percent."
Comyn said he recognised the impact the bank's mistakes were having on customers.
<div data-module="video" data-class="video-js video-js--network" data-param-page-name="finance:finance:home:default" data-video="5778774177001" data-category-name="MSNVideo_Cat" data-category-value="ausydney" data-sticky-enabled="false" data-sticky-target-selector=".layout__utility" data-show-description="data-show-description">
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<div id="player_vl6eu" lang="en-au" data-param-page-name="finance:finance:home:default" data-param-video-name-prefix="finance|" data-param-ad-unit="finance/web" data-video-id="5778774177001" data-player="H190EXsjW" data-account="664969388001" data-embed="default">"We just have to recognise we have not done a good enough job for our customers. We got some things wrong. We have made mistakes," said Comyn.</div>
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</div>
"We absolutely need to make sure we do not make them again. And a big part of my job of course is making sure we are a simpler and better bank for our customers, working closely with any customers who have not had a good experience, but most importantly making sure that those sorts of issues do not recur.
"Ultimately it is going to be something that our customers need to decide, and I am very comfortable, and feel very accountable, for ensuring that we deliver great experience and outcomes for our customers over the long term."
The Commonwealth Bank board declared a full year, fully franked dividend of $4.31.
It noted switching from interest-only mortgages was stressing some borrowers.
The number of home loan borrowers late on repayments spiked, but Comyn said customers have been able to get payments back on track by paring back their spending elsewhere.
CBA advised a 10 basis point increase in the number of customers more than 90 days late on their home loan repayments - from 0.60 per cent to 0.70 per cent of borrowers. 
<div>
Comyn said he did not expect the arrears levels would deteriorate further and that "over time, the customers adjust to the new payments".
Analysts asked Mr Comyn about the rising arrears during the results briefing, with Macquarie's Victor German observing the number is a "historical leading indicator for deteriorating credit quality". 
CBA is the largest mortgage lender in Australia, with 1.5 million home loan accounts with a total balance of $374 billion.
Of these, 64 per cent of borrowers are owner occupiers. 
Some 30 per cent of CBA mortgage customers are on interest-only loans, down from 39 per cent a year ago. 
</div>
<div>Around 27 per cent of CBA's interest only borrowers are expected to switch to principal and interest loans in FY2019 with the bank writing to interest only borrowers 12 months before their loans reset to warn them of the changes.</div>
<div> </div>
<div>The AFR noted the briefing was advised 79 per cent of customers coming to the end of an interst only period have an opportunity to extend the interest-only terms for a further year. </div>
<div>
CBA said the uptick in mortgage arrears reflects "pockets of stress" in the economy, mostly in Western Australia, where the bank saw "continued softness in outer metro and regional" areas rather than mining towns, and in the Northern Territory, where its small book was hit by rising unemployment as resource projects were completed.
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CBA profit dips for first time in decade as mortgage arrears spike

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CBA, the nation's largest residential property lender, is set to cease its low documentation products.
The bank is removing low doc products for all home owner, investment loan and line of credit applications.
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<div>
<div id="article-inline-ad">Low doc were aimed at self-employed and small business owners who may not have access to the financial statements and tax returns usually required when applying for a home loan.</div>
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<div>"From September we will be streamlining our suite of products to deliver a simplified and competitive range," the spokesman told The Australian Financial Review.</div>
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Other products to be removed include the one-year guaranteed rate, seven-year fixed rate, 12 month discounted variable rate, rate saver, three-year special rate saver and no fee loans.
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<div>The changes, to start September 29, follow a decision to spin off its wealth management and mortgage broking business along with overhauling the way it rewards mortgage brokers to emphasise "value rather than volumes."</div>
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Brokers account for about 43 per cent of CBA's mortgage flows, compared with ANZ's 56 per cent, Westpac's 46 per cent and National Australia Bank's 42 per cent, according to recent independent analysis by Morgan Stanley.
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CBA to stop low doc loans

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New Zealand businessman Sir Ralph Norris is selling his luxury Darling Point garden duplex seeing as he's now spending more time in his home country.
The former CBA chief, who earlier this year stepped down as the boss at Fletcher Building, paid $5.15 million in 2006, the same year he was appointed a distinguished companion of the New Zealand Order of Merit.
He bought it from the rag trading Gazal family.
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2018/5/31/NORRIS2.jpg" alt="">
The <a href="https://www.propertyobserver.com.au/%20https:/www.realestate.com.au/property-apartment-nsw-darling+point-128467602" target="_blank">Darling Point duplex</a> has three bedrooms and three bathrooms.
It has views from Rushcutters Bay to the city skyline.
Every room opens to the wrap-around landscaped alfresco spaces. The entry level with second living area opens to a heated swimming pool.
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2018/5/31/NORRIS3.jpg" alt="">
Ballard Property agents Mark Lowe and Amanda Cook have a June 23 auction.
They describe it as a first-class entertainer.
Norris took the top job at CBA in 2006.
 
 
 
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jrobinson-rf4aSBido9

Former CBA chief lists Darling Point duplex

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Matt Comyn has been promoted internally to be named Commonwealth Bank's new chief executive.
The 20 year Commonwealth Bank veteran, who had been head of the retailing banking arm, will replace Ian Narev in April.
Narev announced last August he was to step down from the position.
It comes after a series of money-laundering scandals hit the retail banking arm.
Comyn is set for a bumper pay day, and will earn $2.2 million a year, with potential bonuses taking his yearly salary up to closer to $8.4 million.
One of Comyn's responsibilities as head of retail banking was the rollout of the ATM machines which were central to the money-laundering charges.
Commonwealth Bank chair Catherine Livingstone released a statement to the ASX, citing Comyn's mix of attributes as key to his appointment.
"His mandate is to continue to make the necessary changes to ensure CBA remains a leading bank with an unwavering focus on its customers and delivering outcomes for our shareholders, while achieving the highest operational standards unequivocally fulfilling our regulatory responsibilities," Livingstone said.
"Matt's appointment will enable a smooth transition to new leadership, as CBA responds to the current regulatory processes and legal proceedings, accelerating the related changes and improvements already underway."
 
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Matt Comyn, the Commonwealth Bank veteran made new chief executive

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Western Australia has the most problem home loans in Australia for the country’s largest mortgage lender, the Commonwealth Bank of Australia.
While home loans in WA only account for 16 per cent of the total for the bank, the proportion of loans that are 90 days or more behind in repayments jumped by a quarter from close to 1 per cent in December, the bank's results for the year to June showed.
WA has a 1.23 per cent arrears rate in home loans, twice the national average, reported The Australian Financial Review.
The state’s housing market is still feeling the shocks from the end of the mining boom. Perth house prices fell 1.8 per cent to a near-five-year low of $555,788 in the June quarter even as unit prices rose 1.1 per cent to $377,823, data from Domain show.
CBA had a 25.2 per cent share of the country's total home loan market as of June.
Though the bank reported a better-than-expected $9.9 billion profit for the year to June its retail banking expenses rose 5 per cent to $699 million, mainly due to sluggish conditions in the largest two resource-dependent states.
Expenses rose in that category "as a result of higher arrears and losses for home loans and consumer finance, predominantly in WA and Queensland", the bank said.
CBA’s total home loan balance rose 7 per cent from a year earlier to $485.9 billion driven by strong growth in retail banking, New Zealand and its Bankwest unit, it said.
At the same time, the bank’s exposure to Sydney’s apartment market has grown. While apartment developments accounted for 36 per cent of its total $12.3 billion residential book, Sydney made up 61 per cent – or $2.8 billion – of that. 
The bank’s exposure to the Melbourne apartment market was $900 million, while Brisbane at $300 million and Perth with $200 million were way behind.
"Weighting to Sydney [is] increasing as exposures to other capital cities reducing proportionally quicker," the bank said.
Over the six months to June, CBA reduced the value of its apartment development exposure by $700 million, or 14 per cent, to $4.5 billion.
The bank said it had a "lower" portfolio loan-to-value ratio of 59 per cent.
 
 
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jonathanchancellor-7SQnKwU6yx

WA home loan arrears twice of national rate: CBA

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The Minutes of the August Board meeting were a low key affair, as anticipated.
There has been plenty of communication from the RBA over the past two weeks including the August Statement on Monetary Policy (SMP) and RBA Governor Philip Lowe’s appearance before the House of Representations Standing Committee on Economics.
In that context, today’s Minutes were unlikely to contain any major surprises.
On Friday, the Governor endorsed market pricing that the next move in rates is up when he said, “the current market pricing implies a greater probability of a rate rise than a rate reduction, I think they are reasonable assumptions and I don't want to dissuade them.”
<a href="https://www.propertyobserver.com.au/images/2017/08/15/Screen%20Shot%202017-08-15%20at%201.12.37%20pm.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/2017/08/15/Screen%20Shot%202017-08-15%20at%201.12.37%20pm.jpg" alt="">
This view was backed up in today’s Minutes as the Board dropped their reference from the July Minutes around developments in the labour market continuing to warrant careful monitoring.
For the record, in the July Minutes it was stated that: “the outlook for growth and inflation meant that developments in the labour and housing markets continued to warrant careful monitoring.”
In the August Minutes that statement was tweaked to, “members regarded conditions in the housing market and household balance sheets as continuing to warrant careful monitoring”. This is a less dovish stance.
But we don’t think it materially changes the outlook for rates; it simply validates current market pricing.
The Board continues to sound relatively upbeat on recent developments in the global economy.
In particular, it was noted that, “economic conditions had strengthened over the prior year and the improvement had broadened beyond international trade.”
A gradual increase in global inflation is forecast despite wage growth and core inflation remaining “subdued” as labour market have tightened.
<a href="https://www.propertyobserver.com.au/images/2017/08/15/Screen%20Shot%202017-08-15%20at%201.12.46%20pm.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/2017/08/15/Screen%20Shot%202017-08-15%20at%201.12.46%20pm.jpg" alt="">
The Bank’s assessment of the domestic economy contained nothing new compared with the August SMP.
But on the outlook for inflation, the Board noted that some forthcoming ABS rejigging with the CPI weightings will lead to slightly lower reported inflation from Q4 2017.
This information was incorporated into the RBA’s latest inflation forecasts and doesn’t appear to have meaningfully impacted their numbers.
On housing, the Board suggested that, “conditions had eased since late 2016” in Sydney in Melbourne.
We are not as convinced as the Board.
<a href="https://www.propertyobserver.com.au/images/2017/08/15/Screen%20Shot%202017-08-15%20at%201.12.57%20pm.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/2017/08/15/Screen%20Shot%202017-08-15%20at%201.12.57%20pm.jpg" alt="">
In our view there is very little evidence that conditions in the Sydney and Melbourne housing markets have cooled. In fact, after a seasonal slump in prices in May, the annual growth rates of dwelling prices have accelerated in Australia’s two largest cities.
From a monetary policy perspective, today’s Minutes were never going to be the most important event on the domestic economic this week.
Updates on wages {Wage Price Index (16/8) and Average Weekly Earnings (17/8)} and employment (17/8) are more significant.
There has been some genuine strength in the monthly employment reports over the past four months which means there has been a gradual tightening in the labour market.
But it remains to be seen if it will generate any lift in wages growth.
As a result, the data to come over the next 48 hours is particularly important.
<a href="https://www.propertyobserver.com.au/images/2017/08/15/Screen%20Shot%202017-08-15%20at%201.13.06%20pm.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/2017/08/15/Screen%20Shot%202017-08-15%20at%201.13.06%20pm.jpg" alt="">
From our vantage point, we think that we are still some way from labour market slack being eroded sufficiently to put genuine upward pressure on wages.
As a result, we see policy on hold until deep into 2018.
Gareth Aird is a senior economist at the <a href="https://www.commbank.com.au" target="_blank">Commonwealth Bank</a>.
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Cash rate to stay steady this year and into next: CBA's Gareth Aird

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Australia is experiencing a long-running residential construction upturn, beginning around mid-2012.
Residential construction tends to be very sensitive to interest rates.
So falling interest rates from late 2011, combined with strong population growth, increased foreign demand and pent up demand from underbuilding in previous years meant that a boom was inevitable.
This building boom came at a very beneficial time and helped to offset some of the negative effects from the decline in business investment as the mining construction boom wound down.
The leading indicators of building activity suggest that the current residential construction boom has peaked.
So in this note we take a look at how the economy has benefited from the latest construction cycle and how it’s likely to fair as activity slows.
A typical residential construction upturn has both direct and second-round benefits.
The direct benefits include the additional building activity as well as the jobs created to undertake the additional building work.
Second-round benefits include additional spending elsewhere in the economy as a result of this new construction employment.
For example, spending on furnishings and household appliances for use in the new dwellings.
And then the additional employment as a result of this spending.
In terms of the direct benefits, residential construction upturns since the late 1970’s have on average contributed 2.2 ppts to GDP (chart 1).
<a href="https://www.propertyobserver.com.au/images/2017/08/15/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/2017/08/15/Chart-1.jpg" alt="">
The latest cycle has added 1.6 ppts.
Upturns also contribute to jobs growth. Employment in residential construction, has expanded by 38%, or by 31.2k jobs since 2012 (chart 2).
<a href="https://www.propertyobserver.com.au/images/2017/08/15/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/2017/08/15/Chart-2.jpg" alt="">
This is well above the 6.4% growth rate for total employment over the same time frame.
These jobs have been concentrated in NSW, Victoria and Queensland where the bulk of the residential construction has taken place (chart 3).
<a href="https://www.propertyobserver.com.au/images/2017/08/15/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/2017/08/15/Chart-3.jpg" alt="">
Other building construction jobs, which may include some workers employed in residential construction, have also expanded strongly over the latest residential construction upturn, with 38k extra jobs.
Jobs in construction services have also grown a little faster than total employment growth. Although this includes jobs related to all types of construction activity.
This expansion (and likely contraction) in residential construction jobs is much smaller than the rise in mining sector jobs during the mining boom.
We discuss this more in the next section.
The ABS has estimated that every $1m spent on residential construction generates 17 jobs on a full-time equivalent basis.
This includes jobs in the construction industry as well as the additional jobs outside the industry created as a result of flow on spending.
Spending on dwelling construction has risen by $6.2bn over the cycle so far.
So according to these multiplier effects approximately 105k jobs in total have been added to the economy.
The ABS has also estimated other second round benefits.
For instance, for every $1 spent on residential construction, $1.31 worth of spending is generated elsewhere in the economy.
One area where we have seen this extra spending show up is in the category of household furnishing and fittings including household equipment, floor coverings, household appliances and tools.
Since the latest residential construction boom began, spending in these categories has lifted by 17.5% compared to 10.7% for total household consumption spending (chart 4).
<a href="https://www.propertyobserver.com.au/images/2017/08/15/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/2017/08/15/Chart-4.jpg" alt="">
This has been a positive for the retail sector which has faced many headwinds in recent years.
Other beneficiaries of residential construction booms are the State governments who collect stamp duty revenues.
The NSW, Victorian and Queensland State governments have all had solid growth in stamp duty revenues from the sale of residential properties.
Large house prices gains, particularly in Sydney and Melbourne, and decent turnover has also boosted stamp duty revenues.
In NSW, for example, stamp duty revenues have more than doubled over the past six years and now make up 32% of tax revenues compared to 22% in 2010/11.
We think the latest residential construction cycle has peaked. Residential building approvals peaked in August last year and have fallen by around 10% since then (chart 5).
<a href="https://www.propertyobserver.com.au/images/2017/08/15/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/2017/08/15/Chart-5.jpg" alt="">
However the pipeline of activity remains at record highs which means we are likely to see another quarter or two of growth in construction work done (chart 6).
<a href="https://www.propertyobserver.com.au/images/2017/08/15/Chart-6.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/2017/08/15/Chart-6.jpg" alt="">
We also saw a weather-related fall in residential construction activity in Q1.
This means that we are also due some payback in Q2.
However we think the downturn in the latest residential construction cycle will be gradual, and we expect an extended plateau where residential construction activity remains at a high level over 2017 and into 2018.
This is because a much larger share of approvals have been for multi-units than in previous booms (chart 7).
<a href="https://www.propertyobserver.com.au/images/2017/08/15/Chart-7.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/2017/08/15/Chart-7.jpg" alt="">
Multi-units have a much longer build time, averaging 6 quarters, compared to 2-3 quarters for detached houses.
Indeed some high rise apartments can take 2-3 years or more to build.
This prolongs the construction cycle.
On average, residential construction downturns have subtracted 1.5 ppts from growth.
Our forecasts running to the June quarter 2019 have dwelling construction subtracting just 0.5 ppts from growth.
The smaller subtraction from growth than average reflects the fact the upturn was a little smaller.
Also, strong population growth has lifted underlying housing demand.
We estimate that underlying demand now sits at 185k compared to 155k in mid-2012 at the start of the boom.
This means that the “normal” level of construction activity necessary to meet demand is higher than it was a start of the upturn.
We also expect renovation activity to pick up.
The fact that interest rate are likely to remain low for quite some time is also a factor behind our forecasts for a relatively shallow downturn.
We expect the RBA will leave the cash rate on hold until late 2018.
And that the tightening cycle from there on will be fairly cautious.
In terms of the number of dwelling commencements we expect a slowing to 200k in 2017/18 down from 217k in 2016/17.
And then a further decline to 185k in 2018/19.
For employment, we expect that job losses will occur fairly gradually alongside the gradual decline in activity.
This will help the labour market better absorb these workers.
There are a number of other reasons to expect that the disruption from the downturn in residential construction jobs to be minimal.
Firstly, the jobs downturn will be largest in NSW, Victoria and Queensland, the States where the lion’s share of building activity and gains in residential construction jobs have taken place.
These States all have decent population growth.
And two out of three of these States, NSW and Victoria have strong jobs markets. In NSW the unemployment rate is under 5%, and at a level consistent with full employment.
In Victoria, employment has been growing a solid pace and well above the national average.
Employment growth has also picked up in Queensland in recent months.
Secondly, both NSW and Victoria have also seen a lift in non-residential building approvals (chart 8).
<a href="https://www.propertyobserver.com.au/images/2017/08/15/Chart-8.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/2017/08/15/Chart-8.jpg" alt="">
So additional employment in the non-residential sector may provide a partial offset to some of the jobs losses in residential construction.
In fact the ABS estimates show that the multiplier effects from non-residential construction activity are even larger than for residential construction.
They estimate that $1m spent on non-residential construction generates 24 jobs on a full-time equivalent basis.
And for every $1 spent on non-residential construction, $1.47 worth of spending is generated elsewhere in the economy.
Thirdly, all three of these States have a large pipeline of infrastructure spending still to come from their respective State governments which should also add to jobs growth, especially construction.
The Federal government is also planning a large amount of infrastructure spending over the next 10 years which will also boost employment across the country.
Renovation activity should also provide an offset to lower new residential construction activity.
Renovations usually account for a little above 40% of residential construction activity.
However the share is now very low by historical standards (chart 9).
<a href="https://www.propertyobserver.com.au/images/2017/08/15/Chart-9.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/2017/08/15/Chart-9.jpg" alt="">
Current rates of spending on renovation activity also look low relative to house price growth (chart 10).
<a href="https://www.propertyobserver.com.au/images/2017/08/15/Chart-10.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/2017/08/15/Chart-10.jpg" alt="">
Strong house price growth usually encourages more spending on renovations.
There should be some catch up in renovation spending over the next few years.
Comparing to the recent ramp up and then decline in mining sector jobs, the decline in residential construction jobs will be much smaller.
Mining employment trended higher over a nine year period, rising from around 80k in 2003 to reach a peak of around 275k in mid-2012.
Since the peak of the mining boom around 50k jobs have been lost.
Although more jobs losses are likely as the construction of LNG facilities wind down.
These jobs losses have been concentrated in WA and Queensland. Queensland has had a construction boom and growing tourism sector to help offset lost mining jobs and activity.
But for WA there has been little in the way of other growth drivers to take the place of mining.
As a result economic conditions have been very soft for a number of years in WA.
In terms of the retail sector, a return to more normal growth rates for spending on household furnishings, furniture, appliances and other goods, would be another headwind for the retail sector to contend with.
Kristina Clifton is an economist with the <a href="https://www.commbank.com.au/" target="_blank">Commonwealth Bank</a>.
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