<p><a href="https://www.apartments.com.au/architects/bates-smart">Bates Smart</a> is one of Melbourne's longest standing architecture firms.</p>

<p data-end="421" data-start="0">Founded in Melbourne in 1853 by Joseph Reed, the firm began as Reed &amp; Barnes and has evolved through various partnerships before adopting the Bates Smart name in the 20th century. With a continuous presence spanning more than 170 years, the practice has played a pivotal role in shaping Melbourne’s architectural identity.</p>

<p data-end="826" data-start="423">In the 19th century, Bates Smart designed several of Melbourne’s enduring landmarks, including the Royal Exhibition Building (1880), a UNESCO World Heritage site, and the Melbourne Town Hall. The firm’s influence continued into the 20th century with notable works such as Ici House (1958), considered Melbourne’s first modern skyscraper and a milestone in post-war Australian architecture.</p>

<p data-end="1220" data-start="828">One of their landmark designs was&nbsp;The First Church of Christ, Scientist, at 336-340 St Kilda Road. The building, which is listed on the Victorian Heritage Register, was designed by Bates, Peeble and Smart with construction completed in 1922. Architecturally, the building is significant as a rare example of early twentieth century classicism applied to a religious building. Historically, the building is significant as the first church of the Christian Science movement.</p>

<p data-end="1220" data-start="828">Melbourne developer Time &amp; Place decided to bring Bates Smart back to the area to design their next residential apartment project, Park Modern.</p>

<p data-end="1220" data-start="828">[smartcode_project:default project_id=138453 project_image_fid=2138]</p>

<p data-end="1220" data-start="828"><a href="https://www.urban.com.au/new-apartments/park-modern-south-melbourne-1-middleton-lane-south-melbourne-vic-3205">Park Modern</a>, on one of the largest island sites on the Melbourne CBD fringe, bordered by Dorcas Street, Wells Street, and Middleton Lane, will comprise two sculptural towers. It is being positioned as a design-forward response to evolving owner-occupier preferences in the Domain precinct.</p>

<p data-end="1220" data-start="828">Tim Price, Director at <a href="https://www.apartments.com.au/developers/time-place">Time &amp; Place</a>, says&nbsp;Bates Smart have got a footprint on this city, probably like no other architect.</p>

<p>"It’s a really nice kind of next chapter story, that they created from a design perspective so long ago," Price told Apartments.com.au.</p>

<p>Park Modern will be the third time Time &amp; Place has worked with Bates Smart, having successfully designed and delivered Collins House and Opera on St Kilda Road together.</p>

<p>The brief focused on creating a built form that would feel contextually appropriate while offering a contemporary evolution of inner-city apartment living.</p>

<p>[smartcode_project:default project_id=138453 project_image_fid=2137]</p>

<p>The focus for Park Modern is squarely on owner-occupiers.</p>

<p>“It’s not always about downsizing," Price says.</p>

<p>"Sometimes it’s just about creating a space which is easily maintained, lock up and leave, reflecting people’s aspirations, whether they’re entertainers, big dining room spaces, big open terraces, they’re important parts of any design consideration.”</p>

<p>The building includes a mix of one, two and three-bedroom apartments, as well as penthouses, with layouts and floor plans designed to suit a broad demographic. The architecture has been shaped to capture&nbsp;view corridors to the Botanic Gardens, Port Phillip Bay and the CBD skyline.</p>

<p>Each apartment has been oriented to maximise natural light and provide a clear outlook, elements often cited by owner-occupiers as key criteria.</p>

<p>[smartcode_project:default project_id=138453 project_image_fid=351806]</p>

<p>Rather than defaulting to a generic luxury offering, the amenity strategy at Park Modern reflects specific insights into how residents want to live. The ground floor will include co-working areas, wellness facilities, and a concierge-led lobby that blends indoor and outdoor design cues.</p>

<p>“Wellness has become a more thoughtful consideration, not just gyms or lap pools, but things like magnesium plunge pools, saunas, daybeds, and studio spaces for Pilates and the regular cardio workout,” says Price.</p>

<p>One notable inclusion is a substantial porte-cochère, a covered vehicle drop-off zone integrated into the site plan. It’s a feature rarely seen in inner-urban developments and speaks to the team’s emphasis on ease of arrival and departure for residents and guests.</p>

<p>A display suite for Park Modern is now open by appointment, giving prospective buyers an early look at the project.</p>

<p>[smartcode_project_cta:default project_id=138453]</p>


Joel Robinson

100 years on, Bates Smart returns to South Melbourne's Domain Precinct to design Park Modern

<p>One of the most significant beachfront projects ever proposed for the small suburb of Miami on the Gold Coast, has taken a major step forward.&nbsp;Monaco Property Group has secured approval for <a href="https://www.apartments.com.au/new-apartments/nalu-miami-122-marine-parade-qld-4220">NALU</a>, a $500 million development comprising just 45 ultra-luxury residences on the iconic former Nobby’s Outlook site.</p>

<p>Acquired by <a href="https://www.apartments.com.au/developers/monaco-property-group">Monaco Property Group</a> in 2024 for $70 million, the rare 7,238 sqm Marine Parade parcel boasts more than 80 metres of uninterrupted ocean frontage.</p>

<p>With approvals now secured, Monaco Property Group will move NALU into its delivery phase. The project has been designed by&nbsp;<a href="https://www.apartments.com.au/architects/bda-architecture">BDA Architecture</a>, who collaborated with&nbsp;<a href="https://www.apartments.com.au/landscape-architect/ldg-landscape-architecture">LDG Landscape Architecture</a> and <a href="https://www.apartments.com.au/interior-designers/tom-mark-henry">Tom Mark Henry Interiors</a>&nbsp;to create the low-rise building, its landscaping, and interiors.</p>

<p><img alt="NALU" data-entity-type="file" data-entity-uuid="3fdf578e-7cc4-4b17-bbc2-ba853522a5d8" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/122_Marine_Parade_002.jpg?VersionId=zFhJWVzX0jmCO.5iIIxNELImHesTjWS4" /></p>

<p>Residences will range from 237 sqm layouts to beachfront homes exceeding 1,400 sqm.</p>

<p>At the heart of the project is a 2,200 sqm lifestyle precinct with a bathhouse, fitness centre and resort-style pool, elevated by a concierge service.</p>

<p>Jonathan Grasso, Co-Founder of Monaco Property Group, said the council approval marks an exciting milestone for NALU, which will launch in Q1 2026.</p>

<p>“The project will now progress toward construction, working alongside our world-class collaborators to bring NALU to life," Grasso said.</p>

<p>“Our vision is to create a legacy project for the Gold Coast, one that not only honours the history of the site but also elevates its future, setting a new standard for coastal living in Australia. NALU embodies the pinnacle of design and location and will stand as an enduring icon of prestige and liveability.”</p>

<p><img alt="NALU" data-entity-type="file" data-entity-uuid="6ae8545b-87ca-4dea-90ed-ac273ec6515d" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Image7.jpg?VersionId=Wnmie4bu3x2WQonnG4Pwmh39NdZVKeOV" /></p>

<p>Originally developed in the 1970s as Nobby’s Outlook and later refurbished in 2019 as Nalu, the property has long held a place in the local community’s coastal identity. The new vision will build on this legacy, creating luxury residences that capture ocean views while fostering a lifestyle defined by wellness, connection, and ease.&nbsp;</p>

<p>Beyond its residential offering, NALU will deliver significant economic benefits to the Gold Coast through job creation and opportunities for local suppliers and contractors. Construction is anticipated to commence in early 2026, with completion expected in Q3 2028.</p>


Monaco Property Group approved for $500 million NALU apartments on Miami beach

<p>The most elevated residential tower in Palm Beach, <a href="https://www.apartments.com.au/new-apartments/corallo-palm-beach-5-palm-beach-avenue-palm-beach-qld-4221">Corallo</a>, has officially launched this week, however only a handful of buyers will have an opportunity to buy in to the 17-storey project.</p>

<p>The $200 million mixed-use project includes ground floor dining and retail and is considered so valuable its developer, <a href="https://www.apartments.com.au/developers/changfa-group">Changfa Group</a>, will be staging its release of one-, two- and three-bedroom apartments and penthouses to the market.</p>

<p>[smartcode_project:default project_id=112194 project_image_fid=806]</p>

<p><a href="https://www.apartments.com.au/project-marketer/colliers">Colliers</a> International, Director, David Higgins, said the development’s location just metres from the beach on the corner of Palm Beach Avenue and the Gold Coast Highway influenced the sculptural design by the acclaimed Plus Architecture studio.</p>

<p>“<a href="https://www.apartments.com.au/developments/palm-beach-qld-4221">Palm Beach</a> locals understand the rare opportunity here at Corallo, particularly being the tallest building in the suburb and its proximity to the beach and local restaurants, and they’ve represented the bulk of pre-launch enquiries,” Higgins said.</p>

<p>“The orientation of the apartments captures views of the coastline from Surfers Paradise to Currumbin, and the diversity of floor plans and apartment types provide an exceptional level of choice.</p>

<p>“The first release includes just 59 one-, two and three-bedroom apartments and two half-floor penthouses, with flexible use designed to appeal to both owner-occupiers and investors."</p>

<p>&nbsp;</p>

<p>[smartcode_project:default project_id=112194 project_image_fid=799]</p>

<p>In addition to the ground floor amenity, residents will also have access to a private dedicated wellness level offering 734 sqm of resort-style amenities including a pool, cold plunge, wet deck, steam room, sauna, gym, day bed, fire pit, barbecue area, dining area and yoga/stretch deck.</p>

<p>The project is located within walking distance of Tallebudgera Creek, Burleigh Heads village, Currumbin Alley and Palm Beach Currumbin High School. The Gold Coast Airport is under 10 minutes away.</p>

<p>[smartcode_project:default project_id=112194 project_image_fid=814]</p>

<p>Higgins said Palm Beach remained a hotly contested suburb for home buyers, with prices doubling in the past five years.</p>

<p>“What makes Corallo so appealing to the local market is the diversity of apartment types and pricing, with one-bedroom apartments starting from $841,000 and two-bedroom apartments starting from $1.34 million,” he said.</p>

<p>“The ground floor retail and dining offering will further expand on Palm Beach’s village atmosphere and create a meeting place for locals, and those opportunities for connection are highly valued.”</p>

<p>&nbsp;</p>

<p>[smartcode_project:default project_id=112194 project_image_fid=807]</p>

<p>The on-site sales display, which includes a fully fitted kitchen, bathroom and bedroom, will be open until early works commence in Q1 2026. Each residence at Corallo will feature premium finishes including natural stone, artisanal brickwork, and warm copper accents.</p>

<p>Changfa Group has a two-decade history of delivering premium developments in Australia and internationally, having recently completed its collection of premium townhomes at Lyra, Hope Island, as well as apartment projects in Leichhardt, Carlingford, and Chatswood in New South Wales.</p>

<p>[smartcode_project_cta:default project_id=112194]</p>


$200 million Corallo Palm Beach launches with limited apartment release

<p>In a move that aligns with NSW's accelerated planning incentives for affordable housing, developer&nbsp;<a href="https://www.apartments.com.au/developers/the-one-collection">One Collection</a> has revised its Hills District apartment plans, and taken it to the NSW Government, to secure approval.</p>

<p>The developer, which is currently delivering Horizon Hurstville, is seeking to add 80 more apartments to its <a href="https://www.apartments.com.au/new-apartments/the-one-castle-hill-16-dawes-avenue-nsw-2154">Castle Hill development</a> near Castle Towers. They already have approval for 280 apartments across eight six-storey buildings.</p>

<p><img alt="One Collection" data-entity-type="file" data-entity-uuid="b3c298ba-1cc5-4db7-9872-607c75f8ceca" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202025-10-13%20at%2010.19.22%E2%80%AFAM.png?VersionId=wN9KpFIu5ENSGZLLsaZgXQHrXcwEO3Vd" /></p>

<p>Now on the desks of the NSW Department of Planning is 360 apartments, 48 of which will be dedicated to affordable housing.&nbsp;Affordable housing is to be “fully integrated within the building and visually indistinguishable,” according to the planning submission.</p>

<p>The 15,697 sqm block, an amalgamation of 16 sites, spans across Dawes Avenue, Hughes Avenue, and Camdan Crescent, sits 550m from Hills Showground Metro Station.&nbsp;</p>

<p>"The existing context is quickly changing from free-standing homes into residential flat buildings in line with the Hills Showground Precinct planning framework," Place Studio noted.</p>

<p><img alt="Castle Hill" data-entity-type="file" data-entity-uuid="3ec24948-c185-48fa-af8b-ed25adf302bf" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202025-10-13%20at%2010.19.04%E2%80%AFAM.png?VersionId=zNDX.IeRROX1RlDeYcS38xn8w_dqgU2t" /></p>

<p>They said the design was informed by the site's unique condition of having three street frontages and was developed to to respond sensitively to iots surrounding context.</p>

<p>"The design adopted a conventional perpendicular alignment to the primary street frontage. The massing of the development was carefully modulated to align with the evolving character of the neighbourhood. The design ensured that the scale was not excessive or out of context, but instead contributed to a cohesive urban form consistent with emerging developments in the area."</p>

<p><img alt="Castle Hill" data-entity-type="file" data-entity-uuid="f83ffdaa-f960-469d-b6fe-abcece57c9ef" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202025-10-13%20at%2010.19.09%E2%80%AFAM.png?VersionId=4oKlCyfaKes7jLi1_EMoqa46w2h_YvDZ" /></p>

<p>The apartment mix will be 46 one-beds, 168 two-bed apartments, and 146 three-bedroom units, with 631 parking spaces proposed.</p>

<p>Along the street frontages, the building heights are four storeys with a 7.5 metre setback, and eight storeys with an 11.5 metre setback. It should cost about $150 million to build.</p>

<p>One Collection works hand-in-hand with the respected development and construction firm Masscon, which has built a reputation for leveraging its expertise in the built environment to take on developments others can't. That's what they're achieving at Horizon Hurstville, having taken over the project to deliver it.</p>


First look: One Collection advances plans for Castle Hill apartments

<p>At Yarra’s Edge, <a href="https://www.apartments.com.au/developers/mirvac">Mirvac</a>’s newest tower under construction, <a href="https://www.apartments.com.au/new-apartments/trielle-at-yarra-s-edge-docklands-16-point-park-crescent-docklands-vic-3008">Trielle</a>, sets a new benchmark for elevated living. Rising 45 storeys, 12.5 metres from the Yarra River, the landmark building offers residents access to a private wellness retreat and spa, a resident-only golf simulator, and an elegant lounge, dining and bar complete with a self-playing piano, all without ever having to leave home.</p>

<p>Now, that sense of elevation has reached new heights with the Aerus Sub-Penthouses, a limited release of half-floor riverfront residences on the Collins St axis where the sought-after street meets the Yarra River.</p>

<p>Each Aerus Sub-Penthouse, located across levels 42 and 43, represents the most expansive offering within Trielle, aside from the yet-to-be-revealed crowning penthouses. Spanning between 269 and 301 sqm, these residences are designed to capture natural light and uninterrupted views of the city skyline, Yarra River, and Port Phillip Bay.</p>

<p>[smartcode_project:default project_id=114216 project_image_fid=3784]</p>

<p>Among the collection are three-bedroom sub penthouses, complemented by a media room, and expansive four-bedroom layouts. All include panoramic living areas and oversized master suites with luxury ensuites reminiscent of a five-star hotel, complemented by dedicated dressing rooms finished in timber and natural stone.</p>

<p>The interiors have been crafted by <a href="https://www.apartments.com.au/architects/mirvac-design">Mirvac Design</a>, the developer’s award-winning in-house architecture and design team. Every material has been chosen for quality and longevity, from sculpted stone island benches with feature soft wash LED lighting to bespoke joinery and chevron timber oak flooring.</p>

<p>Kitchens are fitted with a BORA induction cooktop with integrated downdraft extractor, alongside Gaggenau appliances, including a fridge, freezer, and wine fridge. The adjoining butler’s pantry incorporates the exclusive Gaggenau Minimalistic Series including oven, steam oven, microwave, coffee machine and warming drawer, all concealed behind handleless glass panels for a clean, integrated presentation. Bathrooms feature custom Apaisar freestanding baths and basins and natural stone benchtops, continuing Mirvac’s design emphasis on tactile, timeless materials.&nbsp;</p>

<p><img alt="Trielle at Yarra's Edge, Docklands" data-entity-type="file" data-entity-uuid="c00be724-b0f1-47c0-afed-54f829870704" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Aerus%20sub-penthouse.png?VersionId=Uktd61kpLSqNjwJeDFs7IaZ3xgLlDQmu" /></p>

<p>Michael Wiener, Design Director at Mirvac, says The Aerus Sub-Penthouse embodies the apex of Mirvac’s design ethos.</p>

<p>“Moving through your home is like walking on air - a private sanctuary where the craftsmanship is refined, the proportions generous, and the flow so effortless, you feel completely at ease in the sky,” Wiener says.</p>

<p>“In Aerus, we wanted to create a sense of weightlessness - a home that feels suspended in the skyline, full of light, grounded in luxury.”</p>

<p>[smartcode_project:default project_id=114216 project_image_fid=3777]</p>

<p>The Aerus Sub-Penthouses are expected to attract a mix of local and international buyers seeking a long-term residence of scale and quality in a riverfront setting, from returning expats to established families and business owners who value privacy, craftsmanship, and convenience within walking distance of the CBD.</p>

<p>With an unmatched suite of amenities, Trielle is the most extensively appointed development Mirvac has created to date at Yarra’s Edge. Within the tower will be The Oasis, a 900 sqm podium rooftop wellness retreat designed in collaboration with spa expert Naomi Gregory. Located seven storeys above the Yarra River promenade, it features a 25-metre lap pool, spa and sauna, hot magnesium spa, biophilic gym, yoga and Pilates studio, cold-pail contrast treatment, and day spa treatment rooms. Further amenities include a piano lounge, bookable dining room, cinema room, golf simulator studio, games room, teppanyaki bar, dog wash bay, and two flexible work hubs, The Biblioteca library and Mills Place office space, catering to residents’ evolving lifestyle needs.</p>

<p>Construction of the $350 million tower is underway through Mirvac’s in-house construction arm, with completion anticipated for mid-2027.</p>

<p>[smartcode_project_cta:default project_id=114216]</p>


Sky-high sanctuaries: Mirvac unveils The Aerus sub-penthouses at Trielle

Consumer Confidence

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<div>
<p class="post-title entry-title">EXPERT OBSERVER</p>
<p class="post-title entry-title">Very few cases of COVID-19 in Australia, with a handful of cases returning from overseas and headed to quarantine. </p>
<p id="post-body-464826279062726739" class="post-body entry-content"> </p>
<div class="separator"><img src="https://1.bp.blogspot.com/-4cgHNMSh-oQ/Xsx2s06IRqI/AAAAAAAA16g/wDLDtpPvcfkunQPJ6ms16Hj1eSX8Ba3kQCNcBGAsYHQ/s640/CV1.jpg" width="640" height="362" data-original-height="799" data-original-width="1410"></div>
<br><div>Recoveries continue to comfortably outstrip new cases.</div>
<br><div>And, importantly, we're consistently seeing zero deaths reported on a daily basis, with few serious cases even going as far as ICU. </div>
<br><div class="separator"><img src="https://1.bp.blogspot.com/-Oq1uYHyB-KM/Xsx2tGzEx0I/AAAAAAAA16o/8yxL_txLTsEmUkq7S9oXm1PF9d9-Es09gCNcBGAsYHQ/s640/CV2.jpg" width="640" height="362" data-original-height="798" data-original-width="1409"></div>
<br><div>There are 5 cases remaining in ICU nationally, against the expanded capacity of 7,500 beds.</div>
<div><span> </span></div>
<div><strong>Confidence returning</strong></div>
<div> </div>
<div>Consumer confidence increased for an 8th consecutive week, up by +0.4 per cent to a reading of 92.7 points according to ANZ-Roy Morgan.</div>
<div> </div>
<div>Future financial conditions gained by +3.2 per cent and is approaching its long term average reading.</div>
<br><div class="separator"><img src="https://1.bp.blogspot.com/-vCSe5Ue0BOI/Xsx2s1gwkFI/AAAAAAAA16k/Zeb8FGowur8NGJMmSaZfv2E44F65IjhawCPcBGAYYCw/s640/CC2.jpg" width="640" height="502" data-original-height="794" data-original-width="1011"></div>
<br><div><span><em>Source: ANZ-Roy Morgan</em></span></div>
<br><div>Credit card usage data shows that Aussies are willing and able to spend again, but realistically travel restrictions needs to be eased before the economy can begin to fire up properly.</div>
</div>
<div>
<div> </div>
<div>
<strong>PETE WARGENT</strong><em> is the co-founder of AllenWargent property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank">blogger</a>.</em>
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pwargent-M4siyDbqQY

Confidence up for 8th consecutive week: Pete Wargent

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<p><span>Confidence means a lot to real estate markets. And it’s been a long time since Australian real estate has had such a concerted shot in the arm as on Tuesday this week.</span></p>
<p>Against the predictions of virtually every economist in the land, proving yet again how little they understand, the RBA dropped its official interest rate to depths not seen before. Most of the major lenders have dropped their mortgage rates accordingly.</p>
<p>The same economists who incorrectly predicted the RBA board’s decision will also tell you that record low interest rates equals a property boom. Goodness knows where that comes from – certainly not from any historical precedent and certainly not from the experience of recent years where only Sydney has had a market worthy of being described as a boom (no, not even Melbourne’s performance warrants the boom tag).</p>
<p>I note that RBA Governor Glenn Stevens doesn’t see the rate cut reigniting boom scenarios. "In reaching today's decision, the board took careful note of developments in the housing market, where indications are that the effects of supervisory measures are strengthening lending standards and that price pressures have tended to abate," he said in a statement. "At present, the potential risks of lower interest rates in this area are less than they were a year ago."</p>
<p>So I don’t expect the rate cut, replicated by three of the four major banks, to generate anything dramatic in the market. But it will generally help the psyche of property consumers. And the next affordability index will likely show a further improvement.</p>
<p>On the same day, Federal Treasurer Scott Morrison delivered his first Budget, which reiterated strongly that negative gearing won't change, nor will investors be slugged more on capital gains tax.</p>
<p>“We will not remove or limit negative gearing,” Morrison said in his Budget speech. “Those earning less than $80,000 make up two-thirds of those who use negative gearing. They are teachers, nurses, police officers, office workers and tradesmen. We do not consider that taxing them more on their investments is a plan for jobs and growth.”</p>
<p>Amen to that. The tragic thing about those who justify their anti-gearing stance on the grounds that it’s all about housing affordability is that scrapping negative gearing won’t make housing cheaper. Even Bill Shorten says it won’t force down the value of homes, therefore affordability won’t improve. Shorten, like so many others, doesn’t understand the affordability issue and is targeting the wrong culprits.</p>
<p>Another event on Tuesday was publication of building approvals data which showed there’s still some life in building approvals, although the monthly bounce may be an aberration because the longer-term trend is down (from record high levels, it must be said).</p>
<p>This closely followed the release of price data for April, which shows that the home value index has risen in the past three months of the year in seven of the eight capital cities.</p>
<p>That includes a 3.9% rise in Sydney. That would tend to rubbish claims of a collapse in values and a bursting of the bubble. I say “tend” because this is one set of figures from one source and it’s not uncommon for another major source to publish figures that are largely contradictory.</p>
<p>Based on the CoreLogic numbers, however, Adelaide’s prices rose 4.5% in the past three months and Brisbane was up 2.8%. I’ve been predicting good growth in those two cities, but I’m not getting overly excited because of what I said in the previous paragraph.</p>
<p>But, according to these figures, even Perth and Darwin showed glimmers of price growth in the latest quarter.</p>
<p><span> </span></p>
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j.ballantyne1990-6AQqhLzZaK

Going against economists show how little the RBA understands:Terry Ryder

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<p>EXPERT OBSERVER</p>
<div>Consumer confidence rose +1.2 per cent last week to 93.5, according to ANZ-Roy Morgan, a 13-week high.</div>
<div> </div>
<div>However, confidence levels remain well below the monthly average since 1990 of 112.6, and even still a reading of 93.5 is equivalent to what Australia experienced through the financial crisis. </div>
<div> </div>
<div class="separator"><a href="https://1.bp.blogspot.com/-GiiMRsb3VJI/X2mvvSDoXPI/AAAAAAAA4Yo/M31dOQEtBFQURp1mqYO6ZN2Uj1wL749LwCNcBGAsYHQ/s497/ANZ.jpg"><img src="https://1.bp.blogspot.com/-GiiMRsb3VJI/X2mvvSDoXPI/AAAAAAAA4Yo/M31dOQEtBFQURp1mqYO6ZN2Uj1wL749LwCNcBGAsYHQ/w640-h124/ANZ.jpg" width="640" height="124" data-original-height="96" data-original-width="497"></a></div>
<div> </div>
<div><em>Source: ANZ-Roy Morgan</em></div>
<div> </div>
<div>On March 29 the COVID shock saw consumer confidence reading hit the lowest level in half a century at 65.3, but it has since rebounded by 43 per cent. </div>
<div> </div>
<div>Curiously confidence levels in Melbourne have picked up this week to a level 'a touch below neutral' -  possibly on optimism of restrictions being eased - and confidence levels in Melbourne are now higher than in Sydney. </div>
<div> </div>
<div><strong>RBA update</strong></div>
<div> </div>
<div>The RBA put out some state level payroll jobs figures this week which showed that jobs have been steadily picking up elsewhere, but not in Victoria. </div>
<div> </div>
<div class="separator"><a href="https://1.bp.blogspot.com/-Vb4YsejRGNI/X2mtFAsXk4I/AAAAAAAA4Yc/FRvDK2DZjMA9RCB5W6W_o7i8SS1xxwEZQCNcBGAsYHQ/s861/Payroll.jpg"><img src="https://1.bp.blogspot.com/-Vb4YsejRGNI/X2mtFAsXk4I/AAAAAAAA4Yc/FRvDK2DZjMA9RCB5W6W_o7i8SS1xxwEZQCNcBGAsYHQ/w640-h592/Payroll.jpg" width="640" height="592" data-original-height="795" data-original-width="861"></a></div>
<p>However, the payrolls recovery has stalled this week, and indeed it cannot really take hold until the Victorian economy sees restrictions broadly eased. </p>
<div>Separate analysis from UBS highlighted how small businesses have disproportionately felt the pain this year, and this is reflected in hiring figures relative to large businesses. </div>
<div> </div>
<div>This has raised the prospect of a potential further reduction of interest rates, as discussed today by the RBA’s Guy Debelle.</div>
<div> </div>
<div class="separator"><a href="https://1.bp.blogspot.com/-kqxfc4IZChY/X2nDF25XE6I/AAAAAAAA4ZI/XcoZNYya-YIX9PQpssLf8Kn_DGw_qX8OwCNcBGAsYHQ/s727/AJ.jpg"><img src="https://1.bp.blogspot.com/-kqxfc4IZChY/X2nDF25XE6I/AAAAAAAA4ZI/XcoZNYya-YIX9PQpssLf8Kn_DGw_qX8OwCNcBGAsYHQ/w640-h429/AJ.jpg" width="640" height="429" data-original-height="486" data-original-width="727"></a></div>
<div> </div>
<div>The RBA has now expanded its balance sheet significantly, almost doubling from from $170 billion in February to $300 billion, through its various policy measures. with a further 'decently large' expansion to come. </div>
<div> </div>
<div class="separator"><a href="https://1.bp.blogspot.com/-eZwzPLcqlyc/X2pXB4dYxNI/AAAAAAAA4bM/NlqwEXKdq9kb8vc71h7seJLE4R86aD6QACNcBGAsYHQ/s1457/RBA1.jpg"><img src="https://1.bp.blogspot.com/-eZwzPLcqlyc/X2pXB4dYxNI/AAAAAAAA4bM/NlqwEXKdq9kb8vc71h7seJLE4R86aD6QACNcBGAsYHQ/w640-h370/RBA1.jpg" width="640" height="370" data-original-height="843" data-original-width="1457"></a></div>
<div> </div>
<div>In the money markets swap rates are now at record lows. </div>
<div> </div>
<div class="separator"><a href="https://1.bp.blogspot.com/-AKO7Q4wvkD8/X2pXNbrruuI/AAAAAAAA4bQ/IAE0kGoX9707mn1loIZ6287W93v30zTawCNcBGAsYHQ/s733/MMR.jpg"><img src="https://1.bp.blogspot.com/-AKO7Q4wvkD8/X2pXNbrruuI/AAAAAAAA4bQ/IAE0kGoX9707mn1loIZ6287W93v30zTawCNcBGAsYHQ/w640-h506/MMR.jpg" width="640" height="506" data-original-height="580" data-original-width="733"></a></div>
<div> </div>
<div>Banks are now allowing their offshore funding to roll off, which has reduced the share of offshore bonds funding, and this has been replaced by take-up of the cheaper Term Funding Facility (TFF). </div>
<div> </div>
<div class="separator"><a href="https://1.bp.blogspot.com/-vkhXbLlb_gc/X2pXYv07m7I/AAAAAAAA4bc/1pVnirXTDuIVglV83BEDWOKOTZE1jK0fgCNcBGAsYHQ/s728/Funding.jpg"><img src="https://1.bp.blogspot.com/-vkhXbLlb_gc/X2pXYv07m7I/AAAAAAAA4bc/1pVnirXTDuIVglV83BEDWOKOTZE1jK0fgCNcBGAsYHQ/w640-h536/Funding.jpg" width="640" height="536" data-original-height="609" data-original-width="728"></a></div>
<div> </div>
<div>It's interesting to note that the Chinese economy has come surging back from its 10 per cent decline in the March 2020 quarter, to the extent that its output is now greater than it was at the end of 2019, as targeted stimulus measures have successfully bolstered production.</div>
<div> </div>
<div class="separator"><a href="https://1.bp.blogspot.com/-jeC3WSFTzHg/X2pYjntse5I/AAAAAAAA4bs/iHzmFr0r8tYHBi3sWl4iY4StaSvbA_LSACNcBGAsYHQ/s761/GDP.jpg"><img src="https://1.bp.blogspot.com/-jeC3WSFTzHg/X2pYjntse5I/AAAAAAAA4bs/iHzmFr0r8tYHBi3sWl4iY4StaSvbA_LSACNcBGAsYHQ/w640-h344/GDP.jpg" width="640" height="344" data-original-height="410" data-original-width="761"></a></div>
<div> </div>
<div>Australia has gone down a different route, focusing instead on income support, to the extent that household income actually <em>increased</em> over the previous quarter, which is a very unusual outcome for a recession.</div>
<div> </div>
<div>This was driven by a range of factors including lower interest rates, super withdrawals, mortgage and rent deferrals, and all of the various government stimulus measures (including JobKeeper payments, and JobSeeker). </div>
<div> </div>
<div>No wonder them Harvey Norman shares have come roaring back! </div>
<p><strong>PETE WARGENT</strong><em><span> </span>is the co-founder of AllenWargent property buyers and a best-selling author and blogger </em></p>
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Consumer confidence hits three month high: Pete Wargent

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<p>New research from Aussie home loans has revealed that uncertainty arising as a result of the ongoing COVID-19 pandemic is leading two thirds (65%) of Australians with property plans to lose confidence in their ability to achieve their property goals.</p>
<p>Consumer confidence in the property market has also collapsed from 76 percent in January of this year, to just 46 percent in June.</p>
<p>More than 6 in 10 – or 61 percent – of respondents further indicated that the pandemic has resulted in changes to their property plans, including a third (35%) who say they have delayed them.</p>
<p>The research, commissioned by leading mortgage broker Aussie, asked the same questions of Australians pre-pandemic in January, and again in June, highlighting the doubt COVID-19 has cast over Australians’ plans to buy or refinance their homes.</p>
<p>Despite the uncertainties, 42 percent of Australians said they want to take advantage of the market, but do not know how. This has led to over half (54%) wanting more guidance when it comes to their property and finances, while a third (36%) said they would be more likely to engage a broker now to help them better navigate the property market. </p>
<p>Aussie customer data supports the statistics, with enquires remaining relatively steady. Aussie saw a 1.8 percent increase between January to July 2020, relative to the same time period last year, while lodgements are up 16 percent year-on-year, showing that that many Australians are looking for ways to navigate the current environment to see how they can make their property plans a reality.</p>
<p>Aussie Chief Executive Officer, James Symond, said the strong number of enquiries shows that there is still interest in the market.</p>
<p>“There are many opportunities available right now that could make it favourable for Australians to enter the market, invest, downsize or refinance, including lender cashback incentives, reduced interest rates and government initiatives, such as the First Home Owner Grant, the $25,000 HomeBuilder grant, and the First Home Loan Deposit Scheme (FHLDS),” Symond said.</p>
<p>“During what has been a challenging time for many Australians, including a change in personal circumstances or financial outlook for some, brokers have an important role to play in helping Australians understand their options and make smart choices to keep their property goals on track,” he concluded.</p>
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Two thirds of Australian lack property confidence during COVID-19: Aussie

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<p>EXPERT OBSERVER</p>
<p><span style="font-size: 12.16px;">The worsening coronavirus outbreak and associated rout in financial markets have had a major impact on sentiment this month. The Index has hit a five year low. In fact it is the second lowest level of the Index since the Global Financial Crisis when the Index bottomed out at 79, (with an average read of 86.8 over the period).</span></p>
<p>Therefore, while clearly very concerned, consumers are, for now, taking a more balanced approach to the situation than we saw during the GFC. </p>
<p>Other evidence of this can be found by comparing the ‘family finances’ and ‘time to buy a major household item’ components of the Index which registered 63.7 and 88.2 respectively at the low point of the GFC compared to the current reads of 82.7 and 111.4 respectively.</p>
<p>The survey detail shows consumers are rightly concerned about the near term outlook for the economy but are less perturbed about their finances or the longer term outlook for the economy. That is consistent with the notion that virus-related disruptions will be large but temporary.</p>
<p>At the time of last month’s survey, there were just over thirty thousand confirmed cases of COVID-19 with over 99% in China. A month later there are well over one hundred thousand cases globally with a quarter of these recorded outside of China, with infections rising rapidly in many countries.</p>
<p>Financial markets have also reacted sharply. After showing little change in February, the ASX dropped 11.5% between the February and March surveys (and by a further 4.5% since the latest survey closed). These falls have been despite a 25bp rate cut from the RBA and an emergency 50bp rate cut from the US FOMC. </p>
<p>Responses to additional questions on news recall show by far the highest recall was for news on the economy – 45% of consumers recalling news on this topic with over 85% saying that news as unfavourable. News on ‘international conditions’ also had a relatively high recall rate (25%) and was also assessed by around 85% of respondents as unfavourable. </p>
<p>About 20% of consumers recalled news on ‘interest rates’. The RBA cut rates by 0.25% at its March meeting. However, we again saw consumers assess this news more negatively than usual. As we have noted previously, the favourable/unfavourable mix on ‘interest rate’ news following rate cuts over the five years to 2016 was around 50/50 but has been closer to 30/70 for cuts in 2019 and 2020. That lukewarm response is despite the major banks passing on the rate cut in full to mortgage interest rates.</p>
<p>Across the five component sub-indexes, the biggest fall was around expectations for the economy, particularly over the near term. The ‘economy, next 12 months’ sub-index recorded a spectacular 12.8% drop taking it to 77.9, a five year low but still comfortably above the GFC low of 62.9. In contrast, the ‘economy, next 5 years’ sub-index only fell 1.3%, to 90.4. Clearly consumers expect very challenging conditions near term but are less concerned about medium term prospects.</p>
<p>Assessments of family finances were relatively stable. The ‘finances vs a year ago’ sub-index rose 1.8% although at 82.7 it remains 6.6% below the historical average. Despite the recent carnage in equity markets respondents were balanced about the 12 month outlook for their finances with ‘finances, next 12 months’ sub-index down by only 1.7%.<br>Notably, despite the RBA’s 25bp rate cut and that move by major banks to reduce mortgage rates by the full 25bps, sentiment amongst consumers with a mortgage declined 2.8% in the month.</p>
<p>At the same time, sentiment amongst older age groups fell more sharply, particularly those aged over 65 (–13.8%). This likely reflects several factors including the impact of lower deposit rates on incomes, the hit to superannuation from the sharemarket sell off and perhaps also a higher degree of concern about health risks from the coronavirus, which has a markedly higher fatality rate amongst those in older age groups.</p>
<p><strong>BILL EVANS</strong><em> is Westpac's chief economist</em></p>
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Consumer Sentiment falls to a five year low: Bill Evans

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<p><em><a href="https://westpaciq.westpac.com.au/wibiqauthoring/_uploads/file/Australia/2019/March/er20190312BullAustralianBusinessConditionsFeb.pdf">E</a>XPERT OBSERVER</em></p>
<p>As the 2019 year draws towards a close, conditions in the Australian economy remain weak. Policy stimulus is struggling to gain traction. The NAB business survey for November reports that business conditions have stabilised at low levels.</p>
<p>The survey was conducted from November 19 to 29. Given this timing, the survey is unlikely to have fully captured the recent “sales” - with Black Friday falling on November 29 and Cyber Monday on December 2.</p>
<p>The business conditions index was unchanged at +4, a below average reading. The index has moved broadly sideways since April, after tumbling from +19 over the first half of 2018.</p>
<p>Business confidence fell by 2pts to 0, reversing the 2pt lift in October. Confidence rallied in May, after the Federal election, but the bounce was short-lived. The lack of confidence is understandable in this challenging environment - with weak domestic sales and a slowing global economy, with heightened uncertainty around international trade.</p>
<p>The private business surveys correctly foreshadowed the sharp loss of momentum in the Australian economy from mid-2018, a shift that was led by the home building cycle turning from boom-to-bust, as well as by consumers.</p>
<p>Australia’s September quarter economic report card was another disappointing one - confirming feeble and uneven growth, at 1.7% for the year. The private sector economy is in recession, with private demand contracting by 0.3% in the quarter and declining by 0.4% over the year.</p>
<p>The NAB survey suggests that weak conditions have extended into the December quarter and there is a lack of momentum heading into 2020.</p>
<p>As to business conditions detail for November: trading conditions fell by 1pt to +6; profitability improved but remained weak, up 3pts to +3; and employment conditions moved sideways, at +4.</p>
<p>The survey suggests that employment conditions at this level are consistent with job gains averaging 18k per month near-term (down a little from the 20k per month average for the 2019 year to date).</p>
<p>We note that recently the official jobs data has fallen into line with the more downbeat forward indicators from the private business surveys to be consistent with the sluggish output results. The six month annualised pace of jobs growth has slowed to 1.6%, down from 2.5% in March.</p>
<p>Forward orders are weak, after a one-off gain in October, falling by 5pts to -2.</p>
<p>By industry, while aggregate business conditions have stabilised there has been some shift in the mix. The goods sectors have tended to weaken further since April, while services have improved somewhat. The consumer sectors have lifted off their lows, but retail is still as weak levels.</p>
<p>By state, weakness in trend business conditions is broadly based. Of note, the survey reports that conditions have eased in recent months in WA, mirroring the trend in the mining sector, as commodity prices moderate. Over the past three months, conditions in Qld are reportedly the softest of any of the states.</p>
<p><em>Read full report <a href="https://westpaciq.westpac.com.au/wibiqauthoring/_uploads/file/Australia/2019/December/er20191210BullAustralianBusinessConditions2019Nov.pdf">'Australian business conditions November' (PDF 201kb)</a></em></p>
<p><em><strong>ANDREW HANLAN </strong>i<em>s a senior economist for Westpac</em><br></em></p>
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Australian business conditions & confidence stablise: Andrew Hanlan

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<p>Consumer confidence fell over the weekend, an ANZ survey has suggested.</p>
<p>It appears there is a view the latest cut to the cash rate by the Reserve Bank of Australia was a signal of worsening economic conditions.</p>
<p>The ANZ-Roy Morgan Australian Consumer Confidence index dipped 1.1% from the previous week, with respondents' perception of the economy - including the outlook for the next 12 months - retreating 3.6% and prospects about conditions in the next five years sliding 1.7%.</p>
<p>But the weekly measure of sentiment showed a 3.7% rise in how people felt about their financial condition compared to a year ago.</p>
<p>It was based on about 1,000 face-to-face interviews conducted on Saturdays and Sunday.</p>
<p>Consumer sentiment is still above the average of 114.4 points held since 2014 and the longer term average of 113.1 points since 1990. </p>
<p>But three out of the five major components of the index fell last week:</p>
<ul>
<li>The estimate of family finances compared with a year ago was up from +9.0 points to +13.0 points; </li>
<li>The estimate of family finances over the next year was up from +25.5 points to +27.1 points;</li>
<li>Economic conditions over the next 12 months was down from +7.2 points to +3.3 points;</li>
<li>Economic conditions over the next 5 years was down from +12.8 points to +10.9 points; </li>
<li>The measure of whether it was a good time to buy a major household item was down from +40.3 points to +33.8 points. </li>
</ul>
<p>The measure of inflation expectations rose from 3.7% to 3.9%.</p>
<p>NAB's latest business survey also suggested that the business sector has lost significant momentum over the past year with the recent run of results also suggesting that the economy is unlikely to record a significant pickup in growth in Q2.</p>
<p>According to the survey, the weakening in momentum has been broad-based across the business sector over the past year, with all industries having weakened.</p>
<p>Retail also continues to show ongoing malaise, with reported business conditions at a level last seen in the GFC - while manufacturing has also shown steep declines.</p>
<p><img src="https://www.urban.com.au/images/2019/7/10/NAB%20Business%20Confidence%20June.JPG" alt=""></p>
<p><span>Alan Oster, NAB Groups Chief Economist said, “business confidence appears to have unwound its spike in May, which we think was driven by a short-term election bounce and increased optimism around a renewed interest rate easing cycle by the RBA."</span></p>
<p><span>“While business conditions increased slightly in the month, they remain well below average after trending lower for over a year now. The decrease in conditions has been relatively broad-based across states and industries – suggesting that there has been sector wide loss of momentum over the past year."</span></p>
<p><span>“Forward looking indicators suggest that there is unlikely to be a material improvement in conditions over the next few months with forward orders remaining very weak. This suggests the pipeline of demand is weak and is consistent with below average confidence,” Mr Oster concluded.</span></p>
<p>Sentiment also fell in <a href="/expert-insights/investing/sentiment-falls-4-1-despite-interest-rate-cuts-and-tax-relief-westpac">Westpac's Consumer Sentiment Survey</a>.</p>
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Second RBA rate cut dampens consumer confidence: ANZ-Roy Morgan

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<p>Consumers continue to mark down their expectations for house prices albeit with a choppy profile in recent months, according to Westpac's latest Red Book.</p>
<p>A very weak March was followed by a surprising strong lift in April.</p>
<p>Overall, the Westpac Melbourne Institute Consumer House Price Expectations Index is down a further 0.3% since January.</p>
<p>Westpac economists suggest that likely understates the weakening with the first few months of the year typically seeing a seasonal rise in price expectations. </p>
<p>At 95.6 the Index remains around the lowest levels since we began compiling it in 2009.</p>
<p>Earlier figures from a survey by Mortgage Choice suggest current reads are above GFC lows.</p>
<p><img src="https://www.urban.com.au/images/2019/4/18/Redbook%20House%20Prices%201.JPG" alt=""></p>
<p> </p>
<p>Of those consumers with a view, 32% now expect prices to rise over the next year, 32% expect no change and 36% expect falls.</p>
<p>The state breakdown continues to show a more bearish mix in NSW (30%:29%:41%) and Victoria (26%:29%:45%).</p>
<p>Notably, the price weakening in Perth does not appear to have weighed as heavily on price expectations.</p>
<p>The biggest downgrade in expectations over the last three months has been among Queenslanders.</p>
<p>Prices have continued to weaken in early 2019 albeit with some hints of milder declines in the last three months, although some of this may reflect seasonality with prices typically a touch firmer early in the year.</p>
<p><img src="https://www.urban.com.au/images/2019/4/18/Redbook%20House%20Prices%202.JPG" alt=""></p>
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