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

Joel Robinson

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

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

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

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

Not all apartment amenities are immediately visible.

Swimming pools, gyms, rooftop terraces and residents' lounges have long featured on buyers' wishlists, but as the way Australians live has changed, so too have the features that make apartment living more convenient.

Increasingly, buyers are placing value on the practical aspects of day-to-day life. Fast internet, EV charging, secure bike storage, flexible workspaces and parcel management are becoming just as relevant as lifestyle amenities, reflecting changing habits and expectations.

Online shopping has been one of the biggest drivers of that shift.

Australians spent a record $82.6 billion shopping online in 2025, with almost one in every four retail dollars now spent digitally, making parcel deliveries a routine part of everyday life rather than an occasional convenience.

For apartment residents, however, receiving those deliveries isn't always straightforward.

Without someone home to accept a parcel, deliveries can be redirected to a nearby Post Office, left in building foyers or common areas, or require building management to temporarily store packages. As apartment living continues to grow across Australia's cities, parcel management has become an increasingly important consideration for both residents and developers.

Australia Post's Parcel Locker network is one response to that shift.

<iframe allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" allowfullscreen="" frameborder="0" height="315" referrerpolicy="strict-origin-when-cross-origin" src="https://www.youtube.com/embed/KPZ9j5FRdsQ?si=Qztc1dNP3ZvEIUhb" title="YouTube video player" width="560"></iframe>

Rather than relying on home delivery, eligible parcels can be directed to a nominated Parcel Locker, where they're securely stored until collected. Once a parcel arrives, residents receive a notification through the AusPost app or SMS and can retrieve it using a one-time code or QR code at a time that suits them.

The network has expanded to more than 1,500 locations nationwide, with Parcel Lockers positioned at Post Offices, shopping centres, supermarkets, transport hubs and, increasingly, within or alongside residential developments.

That growing presence reflects a broader change in how apartment buildings are being planned.

Developers are increasingly considering the operational side of apartment living alongside traditional lifestyle amenities. Just as secure mailrooms, bicycle storage and EV charging have become more common inclusions, parcel management is emerging as another feature that supports everyday convenience.

It also helps preserve the arrival experience within a building. Carefully designed lobbies and communal spaces can quickly become cluttered when deliveries accumulate, while secure parcel solutions reduce the likelihood of missed deliveries or parcels being left unattended.

For buyers comparing apartments, these everyday details are becoming part of the decision-making process.

Location, floorplans and finishes remain fundamental, but the features that simplify daily life are carrying greater weight than they once did. As online shopping continues to shape consumer behaviour, secure parcel delivery is increasingly becoming another amenity worth looking for.

Parcel delivery is joining the apartment amenity checklist

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

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

Chinese Buyers

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There are nascent signs Chinese foreign buyers have tuned down their enthusiastic buying of Sydney property.
There are three pinpointed causes.
Firstly Beijing has narrowed the window for capital outflows to Australia.
At the same time, Australian banks have tightened lending criteria to Mainland China investors due to APRA regulatory requirements, and in some cases won't lend to foreign investors at all.
This week Chinese local and international estate agents reported a sharp drop-off in sales over the last six weeks as new property taxes took effect after the NSW State Budget.
From July 1, NSW doubled the stamp duty on foreign buyers to eight per cent and increased the land tax surcharge from 0.75 per cent to two per cent.
It's a little too early to say the allure of Australian property has gone, but the Chinese language property portal Juwai.com calculated searches on Australian property for sale are down a third in the first six months of 2017 compared with the second half of last year, while global searches were up.
The emerging trend coincides with a warning from a former US Federal Reserve official that our economy could be at risk from a housing market downturn if Chinese buyers retreat from residential property.
Dr Nellie Liang, who was in Sydney recently to share her views on financial stability with the Reserve Bank of Australia, said a "trigger" could be a reversal in international capital flows.
Dr Laing suggested "when you have the outsiders buying properties, if the outside money pulls out and prices fall, there's innocent bystanders who took on debt and end up underwater, which could lead to defaults."
“China is such a big economy now, and they have links to other countries, including to Australia and Canada through the housing markets, that people need to be thinking about," said the senior fellow at the Brookings Institution in Washington. 
Twenty per cent moves in house prices isn't crazy anymore, Dr Laing even suggested.
The National Australia Bank property expert panel calculated foreign acquirers in the combined established and new property markets represented 17 per cent of all apartment buyers and 11 per cent of house buyers in the June quarter. 
Chinese buyers make up the largest percentage.
Some experts believe official figures underestimate the real extent of foreign money pouring into Australian real estate because Chinese Australians and permanent resident holders act as conduits to buy property for friends and family back home.
Sydney has certainly enjoyed a stellar run with Chinese purchases, but a 50 percent sales outcome at last weekend's major Sydney CBD off the plan offering was the lowest take-up in many years.
And there are still record numbers of new apartments approved and likely to come onto the market. 
Hopefully the cooling trend in Chinese buying interest is more a pause rather than a conclusion.
This article first appeared in the Daily Telegraph.
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jchancellor-FAypfDUnLy

Signs Chinese foreign buyers have tuned down their enthusiasm for Sydney property

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Amid the Federal budget moves to introduce a vacancy tax, a survey has found that a quarter of Chinese buyers of residential property leave them empty.
The survey by investment bank UBS of mainland Chinese customers also showed that a further 45 percent rent out their investment properties and so are unlikely to be affected by higher local taxes on foreign buyers of residential property imposed by countries such as Australia.
The effect of higher charges depended on the motivation for buying, according to UBS's global head of real estate Kim Wright who oversaw the survey.
"If it's for permanent self use or temporary self use, presumably the stamp duty is an added cost, but if there's another reason why they buy – if they've got a kid at university or business abroad – then maybe it's not as material," she was cited as saying by The Australian Financial Review.
The respondents were mostly undeterred by China's tighter currency controls in their wish to buy residential property.
The survey of 3,300 people in March and April excluded high net worth individuals. 
The survey’s results comes amid evidence that mainland Chinese demand for Australian residential property is weakening.
Real estate agents have reported a sharp drop in Australian sales over the past six weeks as new property taxes take effect, while others say Beijing's tighter capital controls are also hurting demand, according to the AFR.
The six-monthly UBS Evidence Lab: China housing survey, the fifth by the investment bank, features Australia as just one of many destinations sought by Chinese buyers. Only 10 per cent of respondents said they owned property outside China and Hong Kong - higher than in previous surveys - with Singapore, Japan and Canada the preferred destinations. 
Sydney ranked fourth on the list, followed by London, New York, Melbourne and San Francisco.
The fresh appetite for foreign property from mainland China came at a time of renewed vigour that pushed domestic property sales in the largest Tier 1 and Tier 2 cities up 25 per cent year on year in January and February before easing to 15.7 per cent in mid-May.
"'Animal spirits' are increasingly behind the re-acceleration in Chinese housing demand," the survey says. 
"Expectations of higher prices were behind 30 per cent of all purchases in the last 12 months and the reason for two-thirds of buyers purchasing earlier than they planned. The proportion of consumers expecting price declines is at record lows. Higher leverage has also helped fuel housing sales, making credit tightening more effective than before."
More than two-thirds of respondents said tighter credit controls would not put them off buying overseas.
A quarter of the properties bought around the world by Chinese investors are left empty, the survey reveals.
The survey shows that mainland Chinese demand for residential property responds to price and currency factors.
Over the six months to the March-April period when the survey was conducted, mainland buying of Hong Kong residential property had been strong with buyers attracted to the weaker US dollar-linked Hong Kong dollar, and a willingness of many developers to rebate stamp duty costs to buyers.
The weaker British pound also sparked renewed but cautious interest in the London market, the report said.
"Our survey shows a rising trend of mainland consumers owning residential property abroad, notable given our survey doesn't capture high net worth consumers," the report said. 
Tightening of credit by Australian banks to foreign buyers was also not much of a factor, with 56 per cent of mainland Chinese buying in cash, either from their own savings or with cash contributed by friends or family.
"The Australian market was very concerned by the settlement risk and strength of Asian buyers when the Australian banks decided not to lend as aggressively to Australian buyers," Wright said.
"But in most markets the Asian buyers of residential property abroad tended not to use local banks for financing."
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jonathanchancellor-7SQnKwU6yx

A quarter of Chinese buyers leave properties vacant: UBS survey

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The Australian economy’s “single biggest risk” is the housing market and any pullback by Chinese property investors could trigger a crisis, according to a top executive of a global fund manager.
Banks and the stock market would be hit the hardest in case of a housing downturn, said Magellan Financial Group CEO Hamish Douglass, who manages the group’s $9 billion global fund.
“The reason the economy has been so strong is because of the massive residential construction boom, and it’s been very supported by Chinese investors,” Douglass was quoted by The Australian. 
The role of Chinese investors was highlighted by commentator Robert Gottliebsen, who recently said that Sydney has averted a crisis of defaulting off the plan Chinese apartment buyers because of the lending role of property developer Harry Triguboff.
A “major correction” in house prices would leave banks exposed, as much of their income is derived from housing mortgages, and also hammer the stock market.
“I see that as the major risk to the economy and to large components of the market. And it is correlated to the Chinese investor in our market,” he said.
Magellan aired his views on the housing market risk during the fund’s result announcement. 
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Housing market is the single biggest risk to economy: Magellan chief 

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Sydney has averted a crisis of defaulting off the plan Chinese apartment buyers because of the lending role of property developer Harry Triguboff, according to commentator Robert Gottliebsen.  
 "The Australian banks are patting themselves on the back because very few of them have major exposures to the Chinese apartment purchasers in Melbourne and Sydney," he wrote in The Australian.
"In Sydney there would have been an enormous crisis with settlements by Chinese purchasers but for the “bank of Triguboff” which has loaned $280 million to Chinese buyers who otherwise couldn’t settle," he said.
But he added with the kind of exposure that major banks have to the residential property market, if a home building slump triggers a further price downturn via higher unemployment then the banks will face mortgage losses.
If prices do fall, it will allow first home buyers to get into the market but the economic impacts of the fall will work against the first homebuyer. 
A fall in the rate of home building has started and if it gathers pace, could have serious economic impact, according to the columnist.
The repercussions could be a rise in unemployment, defaults on bank mortgages and lower stamp duty for state governments.
“And all this is being brought about by a set of housing-boom nervous banking regulators who, if there is a slump in construction, are likely to face decisions they have never before encountered,” says Gottliebsen in The Australian.
But with the kind of exposure that major banks have to the residential property market, if a home building slump triggers a further price downturn via higher unemployment then the banks will face mortgage losses.
If prices do fall, it will allow first home buyers to get into the market but the economic impacts of the fall will work against the first homebuyer.
Gottliebsen advocates a greater efficiency in the development approval process, but says state governments won't change without a crisis. But such a crisis will take place if the rate of the rate of building declines sharply. State governments might then be forced to start to take the actions required to lower costs by streamlining the approval processes to enable first home buyers to get into the market.
Brisbane is leading the fall in construction, where the situation might become “quite ugly”, he writes.
In Sydney, Harry Triguboff says he expects apartment building rates to fall between 25 and 33 per cent over 12 to 18 months which, in anyone’s language, is a major decline.
Melbourne is mixed, with demand strong for apartments and houses in suburban and outer suburban areas including Geelong, but a glut in the inner city.
But despite the city’s apartment problems, planning regulations have changed and developers who don’t take advantage of their current permission will have to build under the new regulations, which will reduce the value of their property.
However, once Brisbane and Sydney building construction rates fall, Melbourne will follow, he says.
“I can’t recall such a widespread vigorous attack on any Australian industry, let alone one that has been driving the economy since the end of the mining boom.”
“The boom in inner city dwellings was created for the most part by Chinese demand. That demand has been hammered first by increasing regulations from China on taking money outside the country; second by the refusal of the Australian banks to fund the Chinese, and finally by a series of taxes and charges being imposed by state governments to make sure the Chinese feel unwelcome.”
Apartment demand from Chinese has now nearly halved, he noted adding local demand has risen but doesn’t offset the gap left by the Chinese. 
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Bank of Triguboff saved Sydney from enormous Chinese apartment buyer settlement crisis

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Australia remains the first choice for Chinese property investors, who are undeterred by regulatory changes or global events when it comes to buying property overseas and the trend is likely to continue in 2017, says a recent report.
Chinese investors were driven by their motivation for diversifying wealth into assets outside of China, as also favourable conditions in gateway cities around the world, according to the survey by off-the-plan property marketplace Investorist.
The China 2017 International Property Outlook, which recorded the findings of interviews from 120 property agents in mainland China, found a majority of agents (88%) predicting sales volume of overseas properties to increase or remain unchanged in 2017.  
Investor interest was undiminished throughout 2016 and the first quarter of 2017, it said.
Earlier this year, data from the Foreign Investment Review Board showed Chinese investors dominated the list of foreign investment approvals for the financial year 2015-2016, with much of it in residential real estate.
Of the total $47.3 billion pledged by Chinese investors in Australia, real estate accounted for more than $31.9 billion, FIRB data showed.
Investorist founder and CEO Jon Ellis summed up the sentiment, saying Chinese outbound property investment “has been an unstoppable juggernaut to date”. 
“It has survived domestic currency controls imposed by the Chinese government and a range of shocks in international buying markets, from Brexit through to a nationalistic Trump administration and a raft of taxation and banking restrictions in Australia,” added Ellis.
The survey included findings from interviews of 120 agencies in mainland China, and compared them with research from other leading global research houses. 
While 70% of the agents surveyed predict an increase in demand, 18% expected demand to remain the same,  while only 12% said it would fall.
<a href="https://www.propertyobserver.com.au/images/2017/07/13/ChineseInvestorsSales.png" target="_blank">Click to enlarge</a>
 <img src="https://www.urban.com.au/images/2017/07/13/ChineseInvestorsSales.png" alt="">
The pricing ‘Sweet Spot’ in Australia for Chinese investors is $400,000 - $800,000,  said the survey, with apartments the top choice (64%), followed by single homes/house and land packages (55%), townhouses (38%) and land (33%).
Melbourne, Sydney and Brisbane accounted for around 90% of all off the plan purchases, with the Gold Coast, Adelaide and Perth way behind. 
In terms of yields, 5-7% including capital growth are the most attractive (50% of respondents), although not important to all. 
The top three selection criteria for Chinese investors were budget (64%), followed by location (63%), then investment return rate (58%).  
Some are motivated by buying in a school/university zone, migration, a second home or investment as a currency hedge. Children’s education was found to be the top incentive for overseas investment (76%), followed by migration purposes (69%) and asset safety and capital gain (68%).
<a href="https://www.propertyobserver.com.au/images/2017/07/13/ChineseInvestorReasons.png" target="_blank">Click to enlarge</a>
<img src="https://www.urban.com.au/images/2017/07/13/ChineseInvestorReasons.png" alt="">
The survey findings come amid major changes to the property landscape over the past 12 months in each of China’s key buy markets.
Though Australia currently holds #1 position for Chinese investors (69% of respondents,  USA (59%) is catching up fast and is expected to overtake Australia in 2017.
In Australia, a raft of increased taxes and duties and tighter lending by banks to investors dampened demand by up to 30% in the latter half of 2016 and early 2017, although demand is again on the rise. 
Interestingly, given the tight regulatory environment, 82% of Chinese investors have enough funds to settle property purchases, and potentially don’t require loans. Loans are sought for financial leverage, currency restrictions and other reasons, it said. 
<a href="https://www.propertyobserver.com.au/images/2017/07/13/ChineseInvestorsGrowth.png" target="_blank">Click to enlarge</a>
<img src="https://www.urban.com.au/images/2017/07/13/ChineseInvestorsGrowth.png" alt="">
In the US, there was much speculation in the lead up to the Presidential election in November 2016 about the implications for domestic property prices and foreign investment. 
“The prevailing view in China since President Trump has taken office is that as a very successful property developer and businessman, he will ensure the US continues to be an excellent market to both invest in and develop real estate,” says the report.
In the UK, the Brexit result in June 2016 and the immediate devaluation of the pound (31-year low, with more than 13% drop in value) presented an immediate opportunity for Chinese investors. A-grade property in London Zones 1–2 previously considered unaffordable, looked more attractive and offered greater yields as a result of the pound’s decline. 
The survey summed up that the overall sentiment from Chinese agents was positive, implying demand would continue from investors in the next 12 months.
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Chinese investors positive on Australian real estate despite tougher laws: Investorist study

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The mystery buyer of former Australian cricket captain Michael Clarke and wife Kyly's redundant Berrima retreat has emerged as Wahroonga based Chinese manufacturer Jie Chen.
The reputed $5.25 million price is still yet to be disclosed, but its understood the Round Hill sale price included Kyly's interior furnishings.
Clarke has been holidaying with Kyly, a lifestyle blogger, and their daughter Kelsey Lee in the Maldives earlier this month having previously signed off on the deal that was two years in the making.
The couple were originally asking $6.5 million, however after sitting idle on the market, the price was reduced to $5 million through Drew Lindsay selling agent Drew Lindsay, who'd sold it three times before.
The Clarke's paid $3.1 million for the sprawling 93 hectare estate in 2012, with a new swimming pool added during their five year ownership.
The cricket lovers haven, complete with a picket fenced oval installed by former financial high flyer Bill Ireland, was a popular weekender rental at a pricey $1,200 a night through www.contemporaryhotels.com.
Kyly added her interior designer professional touches and undertaking some renovations inside the four bedroom Richard Rowe designed homestead.
The idea behind the 2012 purchase was that Clarke would set up his long-awaited cricket academy, round the corner from Bowral, the home of Australia's most renowned cricketer Don Bradman. 
Locals are pondering whether the acquisition suggests a rising Chinese interest in the Southern Highlands market.
It's only the third sale of note to Asian interests in the area.
The breakthrough entry was in 2011 when "Jin" Shangjin Lin, a graduate of Macquarie University and managing director of property development giant Aqualand, paid $7.15 million for a 40 hectare estate in Mittagong.
Lin went onto buy the $52 million Villa Igiea, the 1920s Vaucluse waterfront that has been rented over the years by the likes of Angelina Jolie and Brad Pit and Beyonce and Jay Z.
Since then there have been two major forays into the Southern Highlands.
Early 2014 the iconic Bowral tourism property Milton Park was sold to Chinese property trust interests for around $20 million.
The Edwardian-style 1910 guesthouse in heritage gardens was established by the retailing Hordern family.
A few months later The Chase at Sutton Forest was bought for $5.8 million by Malaysian horse racing tycoon Teo Ah Khing, who founded the Chinese Horse Club where he is also chairman.
The historic trophy estate on 40 hectares features a five bedroom 1880s homestead with a reception hall, formal sitting and dining room and billiard room.
Khing then paid $4.85 million for the 33 hectare winery and wedding venue across Oldbury Road.
Bowral's modern Duck Crossing estate sold for around $4.15 million to the Liu family last year.
Set on 6245 sqm, each of the homes four bedrooms have ensuites, there's a media room, grand office and two gourmet kitchens.
The luxury homes furnishings have Ralph Lauren fabrics and English oak floors.
The Centennial Road property was listed through Unique Estates agent Phillip Dwyer and Drew Lindsay at Drew Lindsay Real Estate. 
The property comes with a detached self-contained one-bedroom guest cottage and pavilion with spa and steam room in landscaped grounds, adjoining Craigieburn golf course.
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Chinese continue to target Southern Highland estates

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Chinese buyers are rushing to buy property in Sydney before the New South Wales stamp duty rises significantly for foreign investors on July 1.
The rates are set to double, moving from the standard four percent to eight percent.
The pre-July 1 activity appears centred on Sydney's east and upper north shore.
A Chinese family bought the Bellevue Hill mansion of Leslie and Kirsty Berger of the Berger family.
The property sold for over $6.5 million, which came with a four percent stamp duty of $260,000. 
Another Chinese buyer has saved $260,000 on a Gordon trophy home, also bought for $6.5 million.
The buyer, a businessman in the food industry, paid $500,000 above the price guide to secure the highest price paid in the suburb this year.
It comes in second as the highest price paid in Gordon.
Under the new foreign buyer policy, land tax also increased from 0.75 percent to two percent, important when the home sits on a 3,700 sqm parcel.
Offered to the market for the first time, the <a href="https://www.realestate.com.au/sold/property-house-nsw-gordon-125260510" target="_blank">grand three level family home</a> has five bedrooms, four bathrooms, a home office, wine cellar, gym, sauna and wet bar.
A tennis court and 12 metre swimming pool sit in the landscaped gardens.
Savills Cordeau Marshall's agents Craig Marshall and Michelle Placks sold the home.
Marshall said the tax hike would deter some foreign buyers.
Darren Curtis, of Christie’s International, on Tuesday night sold a Wahroonga residence on 2850 square metres at 10-12 Woodville Avenue for more than $7 million.
The now Bellevue Hill based insurance lawyer Michael Pitt and his wife Debra have sold their BKH-designed residence in Vaucluse for $14.5 million to a 34-year-old from China, Qianzhen Tang, ending a year-long sales campaign.
The upper north shore house price record has been toppled by the sale of Warrawee trophy estate, Springfields for reportedly about $12 million.
The buyer, originally from China, may have faced an additional $480,000 surcharge depending on their residency status.   
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Chinese prestige property purchase frenzy before July 1 stamp duty doubles in NSW

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There has been a dramatic decline in property applications from Chinese investors ever since the Chinese government turned the screws on capital outflows and reduced credit availability.
Treasury secretary and ­Reserve Bank board member John Fraser said foreign investment applications for residential housing in Australia were expected to fall more than 60 per cent to about 15,000 this financial year, from 40,000 the previous year.
Fraser attributed the steep fall as “partly reflecting” the change in Chinese credit markets, according to an article in www.macrobusiness.com.au citing the Herald Sun.
The figures come amid warnings from property buyers’ advocates in recent years that strong foreign demand for Australian property has contributed to a price surge in some cities.
Fraser’s observations come amid news reports that Chinese investors are pulling out of Melbourne's apartment market, leading to a cooling in prices.
Around 5,000 new apartments are expected to be completed and up for sale this year, but many Chinese buyers will not be able to settle because of trouble with finances following Beijing’s policy crackdown and Australian banks tightening lending to investors.
Fraser’s comments came after Moody’s Investors Service downgraded its credit rating on China by one notch.
Moody's downgraded China's long-term local currency and foreign currency issuer ratings to A1 from Aa3 and changed the outlook to stable from negative on Wednesday, saying the downgrade reflects expectations that China's financial strength will erode somewhat over the coming years, with economy-wide debt continuing to rise as potential growth slows.
Its growth had been fuelled by credit, Fraser said, but “Chinese authorities are clearly aware of the risks attached to this”.
“They are now implementing measures to maintain stability and this has included measures to reduce the outflow of capital from China,” Fraser was quoted as saying in the article.
“In turn, this has contributed to a softening of Chinese investment in Australian resi­dential real estate since late 2016 — although interest in business investment remains strong but, even here, we are seeing the impact of tighter credit availability.”
Around 80 percent of Chinese buyers will not be able to settle because of trouble getting finance, according to Ming Li, a real estate agent in Melbourne's eastern suburbs who specialises in selling Australian property to Chinese investors.
He said many of his clients had either forfeited their deposits or sold their apartments at a loss.
"The Melbourne apartment market is cooling down," Li was cited as saying by ABC News.
"It is kind of the oversupplied market, and the Chinese investors are losing their interest in buying an apartment in Melbourne. The capital gains return is so low."
China’s new rules only allow individuals to transfer about US$50,000 overseas, per head per year. Combined with Australian banks tightening availability of credit to investors, it is like a double whammy for Chinese investors.
"If you look at apartment approvals, which is a bit of a reflection on apartment off-the-plan demand, they peaked 18 months ago, and [now] they have started to slow,” Angie Zigomanis, BIS Oxford Economics property analyst, was quoted by the ABC.
"We did an analysis a little while ago looking at people who had purchased an apartment off the plan since 2011 and since resold."
Zigomanis found that: "Sixty per cent of buyers who had purchased off the plan and then resold recorded either no price growth or a loss."
Citi has warned that the downturn in apartments will filter through to a 7 percent price correction next year in the broader housing market.
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Steep fall in Chinese residential applications this financial year: Treasury secretary John Fraser

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A new study has revealed Sydneysiders are harbouring deep-seated fears that the Australian property market is being driven by ‘super-rich’ Chinese investors.
Almost 900 Sydneysiders were asked about their perception of foreign investors in the real estate market in a study led by Dr Dallas Rogers, housing researcher for the University of Sydney’s School of Architecture, Design and Planning.
The results found that there remains a high level of public concern and discontent about foreign investment, with more than half of respondents believing that government regulation of foreign investment is ineffective.
There was a view that Chinese investors are ‘super-rich,’ as perceived by 58 percent of respondents.
Around 63 percent identified Chinese as the majority of Sydney investors, which is likely given Chinese investment is concentrated in Sydney and Melbourne but within particular suburbs.
“The recent federal budget saw the government come down hard on foreign investors, which demonstrates the dilemma that the government is facing as it attempts to manage foreign investment alongside a disenchanted Australian public,” Dr Rogers said.
“Historically there has always been cultural tension over land and home ownership in this country that began with the arrival of British settlers in the late 1700s, the Chinese gold rush in the 1850s, and the White Australia policy in the early 1900s.
“In the 2000s, we again face significant societal change due to economic, political and social forces from Asia which, given its proximity to Australia, is reshaping our cities. This is the first time we have sought the individual opinion of Australians on the ground about the impact they believe foreign investment is having in their communities.” More than 64 percent of respondents cited foreign investors as the main reason for driving up house prices, despite little data on the inflationary impact of foreign investment on property. 
This is in spite of National Australia Bank data in 2016 showing that Australian residents and investors still make up a greater proportion of real estate buyers in Australia, accounting for 52 percent of sales, while only 14 percent were foreign investors.
The other most cited triggers for driving prices were low interest rates (37 percent of respondents), planning (36 percent) and local residents/domestic investors (32 percent).
The real estate industry recognises that the sale of established properties plays a big role in shaping housing prices, but there are strict conditions placed on foreign investors. Foreign investors can buy new properties, but can only purchase established homes if they meet certain criteria, such as a property that will be used for foreign student accommodation.
Domestic residents and investors therefore still make up almost 60 percent of this market, compared to 8.6 percent who are foreign investors.
The study has followed a 2014 Australian Government Parliamentary Inquiry into individual foreign investment in residential real estate due to mounting public pressure.
“The skills and cultural contribution of migrants to Australian society are so often overlooked by an ingrained historical desire to achieve the great Australian dream of homeownership,” Dr Rogers concluded.
A full report has been published in the <a href="https://www.tandfonline.com/doi/full/10.1080/00049182.2017.1317050" target="_blank">Journal of the Australian Geographer</a>.
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Australians' deep-seated fear of foreign investment in housing remains: Sydney University research

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Harry Triguboff, Australia’s biggest apartment developer, is financing about $200 million mostly Chinese buyers of his apartments as China imposes tougher currency controls to get money out of the country.
Triguboff, the owner of developer Meriton Group, said his company didn’t lend until two years before, but with Australian banks tightening lending to Chinese investors and China making it harder to take out money, financing became an option.
"Now, [I'm lending] maybe $200 million. It might go up to $400 [million]. But then they will start paying back. This is the worst time. What's happening is I don't have old customers, so nobody's paying me back. So I'm building it up. In another year, they'll start paying me back,” Triguboff told the Australian Financial Review in an interview.
Despite saying he was "unfortunately" lending to his customers, it is something Triguboff, who topped the BRW Rich List for the first time last year with an estimated fortune worth $10.62 billion, can afford. Meriton's balance sheet is strong enough to extend finance to its customers. 
“I don’t want to be a banker, but I have to be one if our banks won’t lend,” he said a while back.
Apartment prices are also weakening, he said.
"Now, if anything, it's going down a bit," Triguboff said. "It went up in the beginning of the year. Now it's gone down."
He expects to make $1.4 billion worth of apartment sales this year.
Apartment values in Sydney fell 1.2 percent in April while in Melbourne, they were down 0.9 percent, CoreLogic figures show. Meriton develops in NSW and Queensland but not in Victoria. 
Just last year, Tribugoff was worried that Chinese investors leaving the market would trigger a 10 per cent fall in Sydney apartment prices, which might have even blown out to a 20 per cent fall. 
Triguboff had predicted more buyers to forfeit their deposits and fail to ­settle off-the-plan units due to funding constraints, both as China clamped down on taking money out of the country and Australian banks tightened lending to overseas investors.
"The Chinese government is making it hard for them. That is the biggest problem,” he told the AFR.
But recently, the Chinese have started coming back as they think the Chinese government would start to ease the control towards the end of the year, fuelling optimism among investors.
Recently, Meriton raised his off-the-plan development prices up 3.5 per cent without seeing demand fall. 
Overseas Chinese are now snapping up some 50 per cent of Meriton apartments sold off the plan. Australian-born Chinese are taking around 25 per cent and Australian investors/first homebuyers are taking about 25 per cent, according to a recent article in The Australian.
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