<p>Perth’s new apartment market recorded its strongest quarter of sales since Q4 2021, with 412 apartments sold in Q1 2026 and a record quarterly sold value of $537 million, according to Urbis’ latest Apartment Essentials results.</p>

<p>Urbis said the March quarter result reflects strong, highly product‑specific demand across both ends of the market, from more attainable projects delivering at scale, through to premium stock being absorbed by equity‑rich downsizers.&nbsp;</p>

<p>David Cresp, Partner at Urbis, said the key story in Perth is not demand, it is the market’s ability to convert demand into delivered housing.&nbsp;</p>

<p>“This is the strongest sales quarter since Q4 2021, and it reinforces that demand in Perth is real and it’s local,” David Cresp said. “But the task now is delivery, turning that demand into projects that can actually be built and completed.”&nbsp;</p>

<p>[smartcode_project:default project_id=110291 project_image_fid=302785]</p>

<h2>Affordable product leads, premium demand remains resilient</h2>

<p>Sales in Q1 were led by more affordable projects, with The Boulevard (SKS Group) recording 115 sales in the quarter, the presentation noting this is only the second time a single project has surpassed 100 quarterly sales. The project was able to offer more affordable housing product right next to a train station.&nbsp;</p>

<p>Palmyra West (Finbar) also delivered strong results with 28 sales in Q1, following 84 sales in Q4, with an average price of under $800,000, underscoring depth of demand for well‑located, attainable new stock.&nbsp;</p>

<p>At the premium end, Urbis said downsizer demand is continuing, with the results highlighting Romeo (Applecross, Finbar) recording 75 sales and reaching almost 50% sold in one quarter.</p>

<p>Jual (Shenton Park, Celsius Property) also posted a strong quarter with 28 sales, reaching 39% sold in one quarter.</p>

<p>Urbis noted that Perth apartment demand is not speculative, not investor‑led, and not uniform, describing it as localised, often equity‑driven and highly product‑specific, a pattern reflected in the polarisation between strong “attainable” performers and premium downsizer product.&nbsp;</p>

<p>[smartcode_project:default project_id=148957 project_image_fid=364102]</p>

<h2>Prices underpinned by costs, and the delivery risk is growing</h2>

<p>Urbis said pricing pressure is cost not demand‑driven: construction costs and delivery risk are now a central constraint, with the results noting build costs remain elevated and volatile, and that energy, fuel and labour uncertainty weigh on feasibility.</p>

<p>David Cresp said a growing challenge for private Build‑to‑Sell developers is simply securing a builder in the current environment.</p>

<p>“Developers are really feeling the pressure from a building market that was operating at capacity and securing a builder is challenging,” David Cresp said, adding that even where a builder can be secured, “trying to get to the price that makes the development financially viable is incredibly challenging in the current market.”&nbsp;</p>

<p>Urbis’ broader WA commentary also notes that industry remains at or above capacity with lot and housing creation, and that many builders are limiting new sales to manage stretched workforces and fixed‑price contract pressures, conditions that flow directly into apartment feasibility and delivery timing.</p>

<p>[smartcode_project:default project_id=108869 project_image_fid=317905]</p>

<h2>Supply: improving later, but still constrained, and Perth lags eastern benchmarks</h2>

<p>While near‑term supply remains constrained, Urbis’ forecast shows completions lifting “Supply is forecast to be back above 1,500 apartments per annum for the first time since 2019”, with 1,775 completions forecast for 2026, and volumes remaining above that level over the following years.&nbsp;</p>

<p>Looking further ahead, completions are forecast to reach 2,500 in 2028, with the report noting 32% of that total is social/affordable, reflecting the role of government‑supported delivery in rebuilding the pipeline.&nbsp;</p>

<p>However, Urbis said Perth remains behind comparable markets on pipeline scale. In a national comparison of projects under construction, the report shows under construction Perth Build‑to‑Sell (BTS) at 3,446 apartments versus the Gold Coast at 7,922. Mr Cresp said “The challenge for Perth is how to we grow the delivery pipeline”.</p>

<p>Urbis’ conclusion is that Perth’s market is increasingly defined by product discipline and delivery certainty, with the research identifying “delivery certainty is key” and calling out builder risk and procurement models as core success factors, alongside “timing and staging”.&nbsp;</p>


Joel Robinson

Perth apartment sales hit strongest pace since late 2021 as builder capacity tightens

<p><a href="https://www.apartments.com.au/developers/sammut-developments">Sammut Group</a> has secured development approval for its latest Brisbane apartment project, marking the Sydney developer’s next step in expanding its Queensland pipeline following the success of its debut Gold Coast development, Coast.</p>

<p>The approved project at <a href="https://www.apartments.com.au/new-apartments/44-glen-road-toowong-qld-4066">44 Glen Road, </a><a href="https://www.apartments.com.au/developments/toowong-qld-4066">Toowong</a> will deliver a 15-storey riverfront apartment building with 42 residences, significantly increasing the scale of the site’s previous approval for a smaller luxury scheme. Designed by Bureau^proberts, the development will comprise a mix of predominantly four-bedroom and two-bedroom apartments positioned to maximise Brisbane River and city views.</p>

<p>Sammut Director Julian Sammut said the group had been actively searching Brisbane for several years before identifying Toowong as the right fit.</p>

<p>“Brisbane was the right step for Sammut,” Sammut said.</p>

<p>“With the success of Coast we thought we should definitely look to do more in Queensland alone. We then pushed up to look at Brisbane. We've been looking for I'd say two to three years actually and it was hard to find the right location.”</p>

<p><img alt="Sammut makes Brisbane apartment play" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/f_auto,c_limit,w_1440,q_75/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/field/image/Screenshot%202025-12-23%20at%203.27.14%E2%80%AFPM.png?VersionId=dYAVIL7qdcGA8ojvkslSrLjczXFejSSx" /></p>

<p>Sammut said suburbs including New Farm and Teneriffe were considered before the group ultimately focused on Toowong due to its strong downsizer demographic and limited supply of developable riverfront land.</p>

<p>The site was acquired off-market after what Sammut described as a lengthy negotiation and planning process, with the developer pursuing an uplift to the original approval.</p>

<p>“We are DA approved now which is very exciting,” Sammut said.</p>

<p>“We've had our change approval come through and we've obviously doubled the height, 15 storeys plus rooftop. We've got 42 amazing apartments that are going to be coming to market soon.”</p>

<p><img alt="Sammut makes Brisbane apartment play" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,dpr_2.0,q_auto:good/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202025-12-23%20at%203.27.26%E2%80%AFPM.png?VersionId=ohkRkY0dIZlqdfME2EZePsCQavRiBadE" /></p>

<p>Bureau^proberts said the design responds to Toowong’s evolving urban character, balancing contemporary apartment living with the area’s established residential identity.</p>

<p>“A place where traditional Queensland living has taken place for centuries; Toowong is seeing a shift of contemporary influence, commercial and retail hubs mixed with well-considered residential offerings – all the while maintaining its character and charm,” the architect noted in planning documents submitted to Brisbane City Council.</p>

<p>The architecture practice said the project’s form was shaped by its riverfront setting, flood considerations, neighbouring building scales, and view corridors.</p>

<p>“They said the mix of four and two-bedroom apartments capture the ‘fundamental qualities of Queenslander living,’ translated into the context of a contemporary subtropical building.”</p>

<p>The development sits just off Coronation Drive within walking distance of Toowong’s retail precinct and the upgraded Regatta ferry terminal, while also benefiting from proximity to the incoming green bridge connection to West End. Sammut said the accessibility and amenity offering were central to the site’s appeal.</p>

<p>The approval adds to growing residential activity along the Toowong riverfront, joining nearby projects including Consolidated Properties’ Monarch Residences and Spyre Group’s ARC Residences.</p>


Sammut secures approval for debut Brisbane apartment development in Toowong

<p>Developer Lanevick is heading back into Sydney’s apartment market after focusing more heavily on the luxury townhouse and terrace sector in recent years.</p>

<p>Lanevick, founded and directed by Steve Maroun, is expecting to receive approval in the coming months for a new apartment development in Gladesville, with the aim to launch it to the market later this year.</p>

<p>The 51-apartment project, designed by Studio Johnston, will comprise a mix of one-, two-, and three-bedroom apartments positioned toward the Hunters Hill downsizer market.</p>

<p>“Traditionally it’s been difficult for people in that market to downsize because there just hasn’t been the right product available,” Maroun said.</p>

<p>“We’re targeting buyers who might have 30 to 40 per cent of their house value sitting in the bank after downsizing.</p>

<p>“They still want good spacious entertaining areas, they still want quality design, but they also want flexibility and the ability to enjoy life a bit more after working hard for a long time.”</p>

<p>The project sits near Boronia Park and within close proximity to the Parramatta River foreshore, an area Maroun says offers more of a Hunters Hill lifestyle than a traditional apartment precinct.</p>

<p>“From a lifestyle perspective, it’s really more Hunters Hill than Gladesville,” Maroun said. “You’re close to the foreshore, close to parklands, and still connected back into the village precinct.”</p>

<p>From level four and above, apartments will capture water views&nbsp;toward Sydney Harbour. Communal amenity will include rooftop entertaining areas, wellness spaces, and a gym tailored toward owner-occupier buyers.</p>

<p>“We’ve really designed these apartments around that buyer coming from the Hunters Hill LGA and what they’re actually looking for in their next chapter.”</p>

<p>The proposed development has also been designed to respond to the changing character of the broader Gladesville town centre, where a growing number of mixed-use and residential proposals are expected to emerge over the coming years.</p>

<p>“Gladesville presented a rare opportunity to deliver a genuinely design-led residential project within an evolving lifestyle precinct, just moments from the growing Gladesville town centre, and we’ve approached the project with a strong focus on architecture, liveability and long-term community value,” Maroun said.</p>

<p>Maroun said Lanevick saw a first-mover advantage within the precinct as planning controls continue to evolve to accommodate greater housing density.</p>

<p>“We think there’s a real opportunity there that hasn’t really been serviced properly yet,” he said.</p>

<p>“There’s going to be a broader evolution of the whole Gladesville village precinct over time, particularly with more activation and mixed-use outcomes.”</p>

<p>The Venus Street proposal will include a commercial and retail component at ground level designed to contribute to that evolving streetscape activation.</p>

<p>“A big part of the thinking was how do you activate that area properly and create more vibrancy and amenity, which is what Hunters Hill has been looking for,” Maroun said.</p>

<p>Lanevick’s focus since 2020 has largely been on smaller-scale luxury townhouse and terrace developments. The developer recently completed Royale Randwick, also designed by Studio Johnston, where prices reached $3.65 million. The project was featured in the UDIA NSW 2026 Professional Development Prospectus and was also named a finalist for Development of the Year.</p>

<p>&nbsp;</p>


Lanevick to cater for Hunters Hill downsizers with new Gladesville apartment development

<p>Property developer One Living, backed by former Macquarie banker turned investment manager Chris Green’s investment firm, has unveiled plans to bring more institutional capital into housing to help address the national supply crisis.</p>

<p>The New York-based investor has focused his firm, GreenPoint Partners, on addressing the supply shortage hitting middle market housing in Australia.</p>

<p>It is backing the new One Living business to develop more than 1000 units along the eastern seaboard. The new firm is starting with a development on Mona Vale Road, on the border of Mona Vale and Pymble, in Sydney’s Northern Beaches, with around 140 apartments planned. They are eyeing off more sites across the city.</p>

<p>With cost pressures rising in the industry, One Living’s model is to be a vertically integrated developer-builder, so it can respond directly to the housing gap by removing the cost inefficiencies embedded in traditional residential delivery.</p>

<p>“We are building a platform designed to operate at scale and starting in a market where there’s a clear need for quality, attainable housing,” One Living joint managing director Joseph Scuderi said.</p>

<p>“It’s that missing middle – it’s that attainable end of housing… that’s what most Australians invest into and what Australians can actually afford.”</p>

<p><img alt="Mona Vale" data-entity-type="file" data-entity-uuid="798dfa93-4941-4db6-a696-31e9dc18e81c" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-28%20at%202.31.50%E2%80%AFPM.png?VersionId=mKBqi5C_DmeiXS.AtJkcR8LQIxqCqmFi" /></p>

<p>GreenPoint Partners brings years of experience assembling and scaling real estate operating businesses across major markets. And Green sees a big opportunity in Australia.</p>

<p>“For its size, sophistication and importance to the community, Australia’s living sector has remained largely under-institutionalised, which represents significant opportunity,” Green said. “GreenPoint identified that gap, assembled the right team, and is backing One Living to build a platform that is aligned to market needs.”</p>

<p>Green said being a builder-developer would give the company the capacity and flexibility it required to deliver reasonably-priced homes.</p>

<p>“We want it to be at that attainable level; not super high end luxury but at that attainable level,” he said.</p>

<p><img alt="Mona Vale" data-entity-type="file" data-entity-uuid="74a5344a-4b26-4d4a-ada3-056b1220be77" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-28%20at%202.32.15%E2%80%AFPM.png?VersionId=vY8hXHO4reBMdO8ZXMWCNtGZJofUPQ3j" /></p>

<p>&nbsp;</p>

<p>One Living will undertake a component of affordable housing in its schemes, which it will own and operate, and it could also run build-to-rent on some sites.</p>

<p>Green praised local policy settings.</p>

<p>“The NSW government is being very supportive, strategic and pragmatic in terms of how do we generate more supply of housing,” he said. “We think it’s actually positive for development and the bit that’s been lacking at that attainable level is that it’s lots of relatively small private developers, whereas we want to create an institutional platform.”</p>

<p>One Living is also&nbsp;looking at high-density projects and could take on more institutional funding in the future.</p>

<p>“The way we will be able to achieve economies of scale is through size,” Green added.</p>


One Living enters Sydney's new apartment market with Northern Beaches site acquisition

<p>It's been several years since there's been an opportunity to buy a brand new townhome in Melbourne's coastal suburb of Mordialloc. Even apartment developments in recent times have been few and far between in the area.</p>

<p>Local developer LDS Property identified the gap in new housing, securing a site on White Street, directly opposite&nbsp;Woodlands Golf Club Mordialloc. They've recently launched&nbsp;<a href="https://www.apartments.com.au/new-townhouses/wm-residences-mordialloc-102-white-street-mordialloc-vic-3195">WM Residences</a>, just 13 townhouses which they have already started building.</p>

<p>Projects by Buxton Director Heath Thompson, who is selling WM Residences, says the townhouses x that perfect middle ground be</p>

<p data-end="683" data-start="511">"Mordialloc residents have had limited options to downsize within the suburb, often forcing them to look elsewhere despite long-standing ties to the area," Thompson says.</p>

<p data-end="882" data-start="690">"With very little comparable new supply coming to market, projects like WM Residences are well placed, particularly as buyers look to capitalise on current conditions amid constrained supply."</p>

<p data-end="882" data-start="690">[smartcode_project:default project_id=134646 project_image_fid=6109]</p>

<p>The development, designed by regarded architecture firm&nbsp;<a href="https://www.apartments.com.au/architects/ewert-leaf">Ewert Leaf</a>,&nbsp;adopts a deliberately restrained architectural approach, focusing on simplicity, durability and liveability rather than overt design gestures.</p>

<p>The boutique scale is central to the offering. With only 13 three-bedroom residences, each home is configured to prioritise functional layouts and everyday use, supported by private terraces and secure two-car garages.</p>

<p>Ewert Leaf’s design response leans into a calm, neutral material palette. Interiors are defined by oak flooring, white walls and soft finishes, creating a consistent and understated backdrop. The approach avoids trend-driven detailing in favour of longevity, with an emphasis on natural light and spatial clarity.</p>

<p>[smartcode_project:default project_id=134646 project_image_fid=6110]</p>

<p>Beyond aesthetics, the homes are designed to meet contemporary performance expectations. Each residence targets a minimum 6-star energy rating, incorporating double glazing, comprehensive insulation and all-electric Bosch appliances.</p>

<p>The project’s location supports a walkable coastal lifestyle, sitting within close proximity to Mordialloc’s foreshore, Main Street retail strip and the train station. Local cafés and dining venues, including Suburbia Deli and Hendriks Café, are within a short walk, reinforcing the area’s established neighbourhood character.</p>

<p>[smartcode_project:default project_id=134646 project_image_fid=6116]</p>

<p data-end="247" data-is-last-node="" data-is-only-node="" data-start="0">While <a href="https://www.apartments.com.au/developments/mordialloc-vic-3195">Mordialloc</a> is often defined by its beach and pier, the project taps into other areas of day to day living, offering easy access to local food, casual dining and transport, rather than positioning itself purely as a lifestyle retreat.</p>

<p>WM Residences reflects a continued trend across Melbourne’s coastal suburbs towards smaller-scale, design-led townhouse developments, particularly on infill sites where proximity to amenity is already established.</p>

<p>With construction commenced prior to its market entry, the project aligns with a growing preference among buyers for developments with visible progress and defined delivery timeframes.</p>

<p>[smartcode_project_cta:default project_id=134646]</p>


WM Residences fills gap in Mordialloc townhouse market

Chinese Investment

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<div>Net permanent and long term migration into Australia seems to be steadying, summimg +266,400 in the year to August, according to the latest ABS Overseas Arrivals and Departures figures. </div>
<p><a href="/images/2016/10/11/C2.jpg" target="_blank">Click to enlarge </a></p>
<div class="separator"><img src="/images/2016/10/11/C2.jpg" alt=""></div>
<div> </div>
<div>The number of permanent settlers per annum appears to be very gradually rising again, with 57.1 per cent of settlers hailing from Asia. </div>
<p><a href="/images/2016/10/11/C5.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/10/11/C5.jpg" alt=""></p>
<div> </div>
<div>It feels as though annual population growth in 2016 will be tracking at around +1.3 per cent, or somewhere between +300,000 and +350,000. </div>
<div> </div>
<div>However, the composition of growth has changed very significantly since the peak of the mining investment boom in 2012, with Sydney and Melbourne accounting for a record and ever-greater share of the headcount growth. In aggregate, regional population growth has slowed. </div>
<div> </div>
<div><strong><span style="text-decoration: underline;">Chinese arrivals</span></strong></div>
<div> </div>
<div>More dramatically, total annual short term arrivals increased by a very strong +10.6 per cent over the year to August, to sit at a smidgen under 8 million.</div>
<div> </div>
<div>Outbound trips are still increasing too, but at a far less sprightly pace (in fact the pace of outbound growth is less than half of that of short term arrivals, meaning that a positive rebalancing continues). </div>
<p><a href="/images/2016/10/11/C3-1.jpg" target="_blank"> Click to enlarge</a></p>
<div class="separator"><img src="/images/2016/10/11/C3-1.jpg" alt=""></div>
<p>The annual number of Chinese arrivals continues to accelerate at an astonishing pace, increasing by +23.1 per cent over the past year to a new high of 1.18 million. </p>
<div>There are now more annual visitors from China and Hong Kong to Australia than there are from our more proximate neighbour New Zealand. </div>
<div> </div>
<div class="separator"><a href="/images/2016/10/11/C4.jpg" target="_blank">Click to enlarge</a></div>
<p><img src="/images/2016/10/11/C4.jpg" alt=""> </p>
<div>While many are short term arrivals <em>bona fide</em> tourists, a total of precisely 500,000 short term arrivals into Australia over the year to August were primarily for the purposes of education.</div>
<p><a href="/images/2016/10/11/C1.jpg" target="_blank">Click to enlarge</a><br><img src="/images/2016/10/11/C1.jpg" alt=""></p>
<div> </div>
<div>Higher education is hugely attractive for international students from Asia, since it comes with the lure of potential permanent residency, obviously a big drawcard. </div>
<div> </div>
<div>Note that there are now more than two years of water under the bridge since the higher education boom really teed off in earnest, meaning that over the next year or two there may is likely to be a very strong uplift in students being granted permanent residency (as indeed is forecast by the DIBP) or sundry visa types.</div>
<p><strong><span style="text-decoration: underline;">The wrap</span></strong></p>
<p>While permanent and long term migration to Australia seems to have levelled out, arguably the more significant trends are taking place beneath the surface. </p>
<div>There is plenty of noise in month-to-month figures, but simply following the trend in the number of monthly visitors from China shows a doubling from less than 50,000 per month in early 2012 to well over 100,000 per month in Q3 2016. </div>
<div> </div>
<div>In terms of the property sector, while it's true that that the incoming wave of Chinese capital most impacts new and off-the-plan properties, there are now so many permanent residents and citizens of Chinese heritage that the impacts have shifted into established property too. </div>
<div> </div>
<div>
<em>News</em> draws a tangible link between education arrivals and Chinese property buying activity, notably in inner Sydney suburbs such as Haymarket, Ultimo, Kensington, Surry Hills, Waterloo, and other parts of South Sydney, for example. </div>
<div> </div>
<div>
<p><span><em>PETE WARGENT is the co-founder of <a href="https://allenwargent.com/" target="_blank" rel="nofollow">AllenWargent</a> property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank" rel="nofollow">blogger</a>.</em><br></span></p>
<p><em>His latest book is <a href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx" target="_blank" rel="nofollow">Four Green Houses and a Red Hotel</a>.</em></p>
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pwargent-M4siyDbqQY

Chinese visitors more than double in 4 years: Pete Wargent

<html><body>
<p>Chinese capital has a huge role to play in Australia's housing market over the next few years, for better or for worse. </p>
<p>But there are some looming obstacles. </p>
<p>New South Wales recently introduced a 4 percent stamp duty surcharge for non-resident buyers, with a 0.75 percent land tax. </p>
<p>Harsh, yes, but not as onerous for apartment buyers as the 7 percent stamp duty surcharge that became effective from 1 July in Victoria, while Queensland has also introduced a 3 percent surcharge. </p>
<p>Meanwhile, banks and brokers fearing investigation have become extremely reluctant to lend to non-resident buyers declaring only foreign income. </p>
<p>With a record volume of apartments due for completion over the next two years, and many of these having been bought off the plan by overseas buyers, one way or another one feels that something has to give. </p>
<p><strong><span style="text-decoration: underline;">Fork...</span></strong></p>
<p>At this juncture it feels like it could go either way.</p>
<p>We know that Australia (and particularly Melbourne and Sydney) is a favourite destination for Chinese capital. </p>
<p>Across the drink, Vancouver recently introduced a monster 15 percent tax on non-residents which has turned Chinese investors away and is pushing that housing market south. </p>
<p>This could in turn lead more Chinese buyers to look at Australia as the destination for their fleeing capital.</p>
<p>Although prices have gotten more expensive in Australia for local buyers, thanks to foreign exchange movements this is not so for the Chinese. </p>
<p>Unit prices may have increased by 41 percent over the last four years in Sydney, for example, but when translated into CNY prices have not moved up at all in real terms. </p>
<p><a href="/images/2016/09/28/CNY.jpg" target="_blank">Click to enlarge</a></p>
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<div class="separator"><img src="/images/2016/09/28/CNY.jpg" alt=""></div>
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<div class="separator">
<p><span><em>PETE WARGENT is the co-founder of <a href="https://allenwargent.com/" target="_blank" rel="nofollow">AllenWargent</a> property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank" rel="nofollow">blogger</a>.</em><br></span></p>
<p><em>His latest book is <a href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx" target="_blank" rel="nofollow">Four Green Houses and a Red Hotel</a>.</em></p>
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Chinese buyers... where to from here? Pete Wargent

<html><body>
<div id="post-body-7830260024232386691" class="post-body entry-content">
<div>Relax everyone. </div>
<div> </div>
<div>I've been to China for a week, and I've got everything sussed.</div>
<div> </div>
<div>Alright, I'm only joshing, there are of those pieces doing the rounds already, and I don't have too many original insights today.</div>
<div> </div>
<div>The trip did give me some food for thought, however, about the future of Australia's largest capital cities.</div>
<div> </div>
<div>In my home country of England, the capital city London has never really embraced high-rise living.</div>
<div> </div>
<div>But as the Asian Century progresses it seems likely that some Australian cities will increasingly do so. </div>
<div> </div>
<div>Here are a five things that we might expect to see more of...</div>
<div> </div>
<strong><span style="text-decoration: underline;">1 - Higher construction costs</span></strong><br><div> </div>
<div>Construction costs - and particularly land remediation costs - have become more expensive in Australia over time.<br><br>I looked here previously at some of the reasons why.  </div>
<div> </div>
<div>Construction techniques and equipment are relatively cheap in China. And it shows (oops-a-daisy!)...</div>
<br><div><strong><span style="text-decoration: underline;">2 - Reclaimed land?</span></strong></div>
<div> </div>
<div>In Hong Kong, over the past two decades about 60 square kilometres of additional land has been created, particularly in prime waterfront sites on Victoria Harbour.</div>
<div> </div>
<div>However, legislation has been passed to protect the harbour from encroaching land into the precious and highly valued harbour space.</div>
<div> </div>
<div>We could see some similar trends playing out in Australia.<br><br>Indeed, land reclamation and remediation on the Hungry Mile was an integral part of Lend Lease's flagship Barangaroo project.<br><br>Overall, though, land reclamation on a large scale would likely be opposed in Australia, I feel. </div>
<br><strong><span style="text-decoration: underline;">3 - Lagged delivery of infrastsructure</span></strong><br><br><div>One of the most noticeable things in China, particularly when you see the mainland, is that when something needs building...it gets built!</div>
<div> </div>
<div>China needs a bridge - a bridge gets built. China requires a highway or an airport - a highway or an airport gets constructed.</div>
<div> </div>
<div>Perhaps this is one of the benefits of living in a surplus country.</div>
<div> </div>
<div>By contrast the delivery of infrastructure in Australia always seems to lag, sometimes horribly so.<br><br>Left to its own devices, the market seems to focus on building residential dwellings, but not enough other infrastructure.</div>
<div> </div>
<div>And when stuff does eventually get built, people still carp and complain.<br><br>Look at the extremely successful Gold Coast Light Rail project, for example, which notched up a rip-snorting 14 million trips in the year to 30 June ahead of the forthcoming Olympic Games. And people are still whingeing about it!<br><br>Australia's 10 year bond yield recently hit its lowest level in history, so it's potentially a great time to borrow and build.<br><br>But we'll have to wait and see what Prime Minister Turnbull thinks about that, and whether the electorate has the appetite for debt.</div>
<div> </div>
<strong><span style="text-decoration: underline;">4 - Extreme inner city land prices</span></strong><br><br><div>With a highly concentrated population, prime location development sites in Hong Kong can now be worth up to an extraordinary HK$5 million per square metre.</div>
<div class="separator"> </div>
<div>Inner Sydney has seen some breathtaking prices paid by Chinese investors and developers in recent years for development sites, but nothing remotely on this scale.</div>
<div> </div>
<div>Sydney's population is only 5 million today, but that number if projected to double over the course of this century. So, one day...</div>
<br><div><strong><span style="text-decoration: underline;">5 - Higher density living</span></strong></div>
<div> </div>
<div>We tend to think of Australia's capital cities as being 'dense', essentially because they aren't towns, and because employment tends to be centralised and the traffic is therefore often so bad.<br><br>But with the exception of  handful of suburbs, in global terms Australia's urban populations are in fact anything but dense, as soon as you move away from their central cores. </div>
<br><div><a href="/images/2016/08/15/sp-so-230413-graph7.gif" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/08/15/sp-so-230413-graph7.gif" alt=""></div>
<br><div>Even in the largest capital cities in Australia there are plenty of sites which can still be developed for residential dwellings. </div>
<div> </div>
<div>And if land supply is short, we can also build up as well as out.</div>
<div> </div>
<div>China has a number of large cities that provide example of how much denser city living can become over time. </div>
<div> </div>
<div>BTW the term MOAR, as written in the headline, is internet slang and a combination of the words more and roar.</div>
<br><p><span><em>PETE WARGENT is the co-founder of <a href="https://allenwargent.com/" target="_blank" rel="nofollow">AllenWargent</a> property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank" rel="nofollow">blogger</a>.</em><br></span></p>
<p><em>His latest book is <a href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx" target="_blank" rel="nofollow">Four Green Houses and a Red Hotel</a>.</em></p>
<strong><span style="text-decoration: underline;"><br></span></strong>
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Building MOAR high rise: Pete Wargent

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<p>Chinese state-owned Poly Group is close to buying two George Street office buildings in Sydney's Circular Quay for about $160 million, nearly 60 per cent more than what they traded for last year.</p>
<div>The buildings at 210 and 220 George Street were purchased last year by real estate investment group Anton Capital on behalf of Goldman Sachs for a shade under $100 million from Mirvac Group, said a report in the Australian Financial Review.</div>
<div> </div>
<div>The properties were the final assets to sell in a nearly $250 million non-core office portfolio that Mirvac put up for sale at the beginning of the year.</div>
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<div>Both Poly Group and Anton declined to comment to AFR on the development.</div>
<div> </div>
<div>The deal, if it goes through, would reflect the keen pricing that Sydney's office properties have been bought for in the last six months including Invesco's purchase of 77 King Street, Investa Commercial Property Fund's $442 million purchase of 420 George Street and Charter Hall's $525 million purchase of Macquarie Group's Shelley Street headquarters. </div>
<p>The deal with Poly is believed to be brokered by JLL, which did not respond to inquiries either, the report said.</p>
</div>
<div>Poly Group has been named as a keen bidder on several properties including the race for the $100 million Telstra site.</div>
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jonathanchancellor-7SQnKwU6yx

China's Poly Group close to buying two office buildings in Sydney's Circular Quay for $160 million

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<p class="p1">Chinese investments in Australia have nearly doubled from 2014, with $46.6 billion planned spends in 2014-15, according to the latest Foreign Investment Review Board annual report.</p>
<p class="p1">In 2014, China shot past the US for the first time, after agreeing to spend $27.7 billion, said a report in the Australian Financial Chronicle.</p>
<p class="p1">There were 37,953 proposals that received foreign investment approval in 2014‑15, up from 24,102 in 2013‑14.</p>
<p class="p1">The real estate sector took the biggest chunk, with 37,347 approvals in 2014‑15, compared with 23,428 approvals in 2013‑14 and more than triple the levels of 2012‑13, the FIRB report said. The majority of this increase related to new dwellings approvals, which is consistent with the Australian government’s policy to increase the housing stock by channelling foreign investment into new dwellings. </p>
<p class="p1">Expectedly, real estate investments made up the bulk of Chinese investment plans with a total of $24 billion, double that of 2014.</p>
<p class="p2">To date, Chinese investors have doubled their investments in real estate in both the 2014 and 2015 years, said AFR.</p>
<p class="p1">The rise in foreign investments has also raised security concerns.  </p>
<p class="p2">Following the leasing of the Port of Darwin to Chinese company Landbridge, which has links to the People's Liberation Army, FIRB enacted an amendment to the Foreign Acquisitions and Takeovers Regulations on April 4 to remove the exemption for private foreign investors investing in critical infrastructure assets.</p>
<p class="p1">FIRB will now formally review the sale of state-owned infrastructure assets to private foreign investors.</p>
<p class="p1">Concerns also loomed over the sale of Kidman &amp; Co, which owns 100,000 square kilometres of land across Australia, but they are likely to be chased by two Chinese groups GLAM with a bid as high as $370 million and Pengxin offering $350 million, the AFR cited sources as saying. </p>
<p class="p1">The United States remains Australia’s dominant inward investor country, accounting for around 23.7 per cent of the total stock of foreign direct investment as at the end of 2014, data from FIRB shows.</p>
<p class="p1">No proposals were rejected in 2014‑15, compared with three in 2013‑14, but conditions were imposed on about 40 per cent of all foreign investment approvals, it said.</p>
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FIRB approves Chinese investments worth $46.6 billion in 2014/15, nearly double from previous year

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<p><span>In Sydney's Double Bay, local downsizers bought nearly 75 per cent of Essence, a 37-apartment boutique project launched by Melbourne-based Chinese developer Golden Age.</span></p>
<p><span>The most expensive sold on Saturday was a $2.9 million apartment.</span></p>
<p><span>The $110 million development at <a href="https://www.realestate.com.au/property-apartment-nsw-double+bay-121968762" target="_blank"><span>315-321 New South Head Road</span></a> has harbour views.</span></p>
<p><span>Its one, two and three bedroom residences, most with a northerly orientation across Henrietta Street, were designed by the CARR design group for the Golden Age Group, led by restaurateur and property developer Jeff Xu which bought the site with planning approvals for $18 million.</span></p>
<p><span>Mr Xu told The Australian Financial Review he wanted Golden Age to be known for its prestige apartments as much as its high-rise towers.</span></p>
<p><span>"This is a strategic move for us to have another site in Sydney.</span></p>
<p><span>"I want to tell the market that Golden Age is not only about quantity, it is about quality as well.</span></p>
<p><span>"We can do [a] 70-storey high-rise. We can do [a] three or four-level low-rise as well, as long as it's good quality.</span></p>
<p><span>"Double Bay is a very good project for us to put our brand into Sydney.</span></p>
<p><span>"It's like a business card."</span></p>
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jchancellor-FAypfDUnLy

Essence, Double Bay popular with downsizers

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<p>HSBC's chief economist Paul Bloxham has suggested that the Australian services economy could be driven by Chinese consumer demand.</p>
<p>The article was tweeted by Asian Practice lead at PWC Andrew Parker through his twitter handle <a href="https://twitter.com/A_JParker" target="_blank">@A_JParker</a> and can be read in <a href="https://www.afr.com/opinion/chinese-consumer-demand-set-to-drive-services-economy-20160118-gm8edt" target="_blank">full here</a>.</p>
<p><em>Property Observer</em> listened into Paul's briefing outlook today where he further referred to the anticipated Chinese consumer demand.<span style="line-height: 1.3em;"> </span></p>
<p><a href="/images/Screen%20Shot%202016-01-19%20at%2010.26.06%20am.png" target="_blank">Click here to enlarge</a></p>
<p><img src="/images/Screen%20Shot%202016-01-19%20at%2010.26.06%20am.png" alt="" width="346" height="289"></p>
<p> </p>
<p>Paul also released information regarding Australia's economic future for the year 2016, with the Chinese featuring predominantly.</p>
<p><a href="/images/2016/01/19/Screen%20Shot%202016-01-19%20at%2010.45.09%20am.png" target="_blank">Click here to enlarge</a></p>
<p><img src="/images/2016/01/19/Screen%20Shot%202016-01-19%20at%2010.45.09%20am.png" alt="" width="268" height="237"></p>
<p><a href="/images/2016/01/19/Screen%20Shot%202016-01-19%20at%2010.44.49%20am.png" target="_blank"> Click here to enlarge</a></p>
<p><img src="/images/2016/01/19/Screen%20Shot%202016-01-19%20at%2010.44.49%20am.png" alt="" width="252" height="221"></p>
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jrobinson-rf4aSBido9

Tweet of the day: HSBC's Paul Bloxham on the continued Chinese impact on the Australian economy

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<p><span>Sydney real estate needs foreign investors but Australian regulators may be giving them an unintended advantage over local investors and home buyers.</span></p>
<p><span>Especially now that one of China's biggest financial institutions has started offering zero-deposit home loans for off-the-plan apartments in Australia.</span></p>
<p><span>The banking division of PingAn Insurance unveiled its offering to Chinese investors in Shanghai last week, charging around its credit card rate of 14 per cent, Fairfax Media reported.</span></p>
<p><span>"Join hands with PingAn and realise your overseas property dream," the marketing advised.</span></p>
<p><span>"Become an Australian property owner with zero down payment," the marketing added.  </span></p>
<p><span>Hardly the borrowing practices that the Australian Prudential Regulation Authority and the Reserve Bank of Australia want.</span></p>
<p><span>With increasing impact since last December, our regulators have sought to cool the property market here in Sydney, and elsewhere on the east coast, with tighten lending practices on local banks for Australian property investors. </span></p>
<p><span>APRA requirement for local banks to contain growth in investment lending to 10 per cent a year has triggered an emerging constraint within property markets. Some banks have doubled the deposit to 20 per cent for those investing in off the plan property. Other banks have stopped lending at all. </span></p>
<p><span>Australian regulators are powerless to prevent the lending practices of offshore banks. And PingAn is no small outfit - ranked 96 in U.S. Fortune Magazine’s Global 500 Leading Companies ranking and 1st among China’s non-State owned enterprises. </span></p>
<p><span>But these zero deposit loan offerings confirm the concerns highlighted in the recent past by leading mortgage broking chief John Symond. </span></p>
<p><span>For many months John Symond has worried that the APRA investor home loan lending crackdown would have unintended consequences given the huge increase in non-Australian residents buying property.</span></p>
<p><span>"You might find these foreign investors have even a bigger go because regular Australians are going to find it tougher to get through the hoops to be able to borrow money to buy an investment property," John Symond, the founder and chairman of Aussie Home Loans suggested.</span></p>
<p><span>"Without picking on the Chinese, they have had a huge spike on new housing something like $12 billion in last 12 months - now this doesn't come under APRA as a lot bring money from China. </span></p>
<p><span>"They are certainly help driving the pricing up and driving the shortage of properties available for first home buyers and people looking to buy their home in Australia."</span></p>
<p><span>John Symond then fronted the Federal parliamentary inquiry into home ownership where he noted it was "very easy to play at the edges and talk about APRA tightening up lending restrictions for investors, but what about the 20 to 25 per cent, in some areas 30 per cent, of foreign buyers who predominantly don’t borrow here?"</span></p>
<p><span>Mr Symond noted Chinese investors are unable to buy freehold property at home so are attracted by the Australian market with new measures such as a foreign investors fee of $1000 per million dollars invested not expected to dissuade the Chinese purchasing influx.</span></p>
<p><span>There was a previous policy that property developers were restricted to selling 50% of any new off the plan development to foreign investors. But during the global financial crisis the Rudd changed the ratio to 100% where it is still today. </span></p>
<p><span>Perhaps it is time for Treasurer Scott Morrison to review the playing field.</span></p>
<p><em>This article was first published in the Saturday Daily Telegraph.</em></p>
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