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Melbourne’s apartment market entered 2026 with renewed momentum, but the recovery is uneven, policy-driven, and increasingly shaped by constrained supply.

According to the RPM Apartments &amp; Townhomes Market Report (April 2026), apartments have begun to outperform detached housing on key metrics,yet that performance is occurring against a backdrop of falling approvals and a tightening development pipeline.

At the end of 2025, Melbourne unit values reached a three-year high of $656,500, recording quarterly growth of two per cent. That figure edged ahead of the 1.8 per cent growth recorded in the house market over the same period, marking a notable shift in relative performance. While modest in absolute terms, the outperformance is significant given the sustained dominance of houses through much of the previous cycle.

This shift has been driven in large part by policy. The federal government’s expanded five per cent Deposit Scheme has had a disproportionate impact on apartment demand, particularly in Melbourne where the $950,000 price cap captures a large share of medium- and high-density stock.

As RPM notes, the scheme “heavily favours medium and high-density dwellings,” effectively accelerating demand in the apartment sector.

The impact is most visible in buyer activity. Victoria recorded more than 43,000 new housing loans in Q4 2025, the highest quarterly volume since mid-2022 and one of the strongest results in over a decade. This lift was broad-based across all buyer types, with first home buyers, owner-occupiers and investors all returning to the market with greater confidence.

This surge in demand has flowed directly into apartment pricing, particularly in Melbourne’s middle and outer rings. Middle-ring unit values reached approximately $757,500, a four-year high, while outer-ring units climbed to a record $650,000. Quarterly growth of 2.9 per cent and 2.5 per cent respectively significantly outpaced both the inner ring (0.8 per cent) and the broader house market.

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<img alt="RPM" data-entity-type="file" data-entity-uuid="4628dde5-ad63-4b03-b18e-77d0f750e2aa" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-04-24%20at%209.23.32%E2%80%AFAM.png?VersionId=ig6mqc7Oz7UaszRuzULrGtLPUxGf4NJC" />

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The divergence between apartments and houses is also being shaped by affordability. Detached housing remains out of reach for many buyers, pushing demand toward apartments as a more accessible entry point into well-located suburbs. This is particularly evident among first home buyers and downsizers, both of whom are increasingly prioritising location, amenity and lifestyle over land size.

At the same time, population growth continues to underpin demand. Victoria added more than 122,000 residents in the year to Q3 2025, with Melbourne attracting both overseas migrants and interstate movers, partly due to its relative affordability compared to other capitals.

&nbsp;

<img alt="Population" data-entity-type="file" data-entity-uuid="49e10567-a8b3-47c3-afbd-290f0bb62c49" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-04-24%20at%209.22.25%E2%80%AFAM.png?VersionId=.2Drmko4TPh02X55JdF3mIC1EcG0ZfGl" />

However, the most critical factor shaping the apartment market is not demand, it is supply.

Apartment approvals across Greater Melbourne have fallen sharply, signalling a constrained pipeline of future stock. In Q4 2025, just 2,339 apartments were approved, down 20 per cent on the previous quarter and 47 per cent lower than the same period a year earlier. On an annual basis, 11,066 apartment approvals were recorded, an improvement on the previous year, but still well below medium- and long-term averages.

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This decline reflects a broader contraction cycle that has been underway since 2020. As RPM notes, “apartment approvals appear to be sliding back into a downward trend,” with developers increasingly focused on launching and completing existing projects rather than initiating new ones.

The reasons are well understood. Construction costs have risen more than 20 per cent since 2021, driven largely by labour shortages and material price escalation. At the same time, financing conditions have tightened, with lenders requiring higher contingencies and taking a more cautious approach to risk. Combined with recent interest rate rises, these factors have made feasibility more challenging, particularly for higher-density projects.

This dynamic is creating a disconnect in the market. Demand for apartments—particularly at the more affordable end—is strengthening, while the pipeline of new supply is weakening. In the short term, this may limit the number of new projects coming to market. Over the medium term, however, it is likely to support price resilience and potentially further outperformance relative to houses.

There are some signs of policy-driven supply response. The introduction of Victoria’s Mid-Rise Code, which streamlines approvals for four- to six-storey developments, is expected to improve delivery in well-serviced middle-ring locations. However, this is unlikely to materially offset the broader decline in apartment approvals in the near term.

Despite the positive momentum at the end of 2025, the outlook for 2026 has become more complex. Two interest rate rises early in the year have already impacted consumer confidence, while broader cost pressures, particularly energy and fuel, are feeding through to construction and development costs.

“Victoria’s built form market ended 2025 on a high, but early 2026 rate rises quickly reversed the momentum,” RPM notes.

The implication is that while apartments are currently outperforming houses, the trajectory of that outperformance will depend on how these competing forces evolve. Policy support and affordability are clearly working in favour of apartments, but constrained supply and rising costs are likely to shape the pace and nature of future growth.

What is increasingly clear is that apartments are playing a more central role in Melbourne’s housing market. As population growth continues and affordability pressures intensify, higher-density housing is becoming not just an alternative to detached homes, but a primary solution to the city’s housing needs.
</section>

Joel Robinson

Units lead Melbourne price growth as apartments outperform houses: RPM

Brunswick is set for some of its largest apartments ever delivered with the upcoming new development Frith &amp; Howarth, where the apartments are around 20 per cent larger than what has come before it in the sought-after suburb.

Developer Young Group focused its design on Frith &amp; Howarth around size and scale, but within a boutique building, to create a mini neighbourhood within the mid-rise development. There are just 24 apartments in the mid-rise building on Victoria Street, a short walk to Brunswick Station and the cafe and dining strip along Sydney Road.

“We spent hours comparing what’s currently on the market so we could offer genuine points of difference,” Young Group says, pointing to room sizing, storage, and functional planning as key drivers behind the design.

All of the two-bedroom apartments in the building have been snapped up, with just the large three- and four-bedroom apartments, with the biggest floorplans and best outlooks, remaining.

[smartcode_project:default project_id=134317 project_image_fid=354139]

Apartments open directly into open-plan living zones where full-height glazing draws light deep into the apartment. Sliding doors extend the space outward to terraces, many oriented toward the adjacent park or back toward the city skyline.

Kitchens sit within this central space, anchored by sculptural island benches that reference the building’s faceted exterior language. Storage is integrated across multiple layers, overhead cabinetry, concealed joinery, and, in larger configurations, dedicated sculleries or butler’s pantries.

[smartcode_project:default project_id=134317 project_image_fid=354137]

The penthouse is the largest ever offered in Brunswick. The penthouse measures nearly 400 sqm all-up, with 242 sqm of internal space complimented by a further 149 sqm of terraces.

It spans the whole top floor and has four bedrooms, four bathrooms, and parking for four cars.

[smartcode_project:default project_id=134317 project_image_fid=354133]

Low maintenance resident amenity has been created in the form of a landscaped rooftop, complete with&nbsp;vegetable plots, outdoor cooking areas, and aflresco dining spaces, designed as a place for neighbours to gather outside of their homes.

“To enable connection with neighbours, generous rooftop gardens with communal spaces and outdoor cooking areas offer a chance to develop a sense of community,” says John Patrick, Principal of <a href="https://www.apartments.com.au/landscape-architect/john-patrick-landscape-architects">John Patrick Landscape Architects</a>.&nbsp;

“Private open spaces with a selection of native and exotic plantings and gorgeous city views on the rooftop create a high-end aesthetic, with a low maintenance lifestyle. The perfect balance, so that residents can enjoy a serene living space.”

[smartcode_project:default project_id=134317 project_image_fid=354134]

Sustainability is embedded at both the building and apartment level. <a href="https://www.apartments.com.au/new-apartments/frith-howarth-288-290-victoria-street-brunswick-vic-3056">Frith &amp; Howarth</a> is one of only a small number of all-electric residential developments in Brunswick, supported by solar infrastructure, EV-ready parking, and high-performance glazing. These measures sit alongside less visible systems such as rainwater reuse and high-grade insulation, reducing long-term operational costs while maintaining consistent internal conditions.

Positioned within walking distance of Brunswick Station, Route 96 trams, and established retail along Sydney Road and Barkly Square, the development balances access to transport with proximity to open space, a combination that has become increasingly difficult to secure in inner-city sites.

“These exquisite homes are nestled in a culturally diverse neighbourhood, with parklands and nature right on your doorstep,” says Young Group.

[smartcode_project_cta:default project_id=134317]

Frith & Howarth to deliver Brunswick’s largest apartments

<a href="https://www.apartments.com.au/new-apartments/prince-parade-by-mirvac-brunswick-701-park-street-brunswick-vic-3056">Prince &amp; Parade</a> in Brunswick is entering its final stages of construction, with the removal of the project’s last tower crane and the unveiling of the building’s full façade marking a significant milestone ahead of completion this coming spring.

The Park Street development, designed by <a href="https://www.apartments.com.au/architects/bates-smart">Bates Smart</a>&nbsp;and Mirvac Design with landscaping by <a href="https://www.apartments.com.au/landscape-architect/jack-merlo">Jack Merlo</a>, is now largely structurally complete, with internal works progressing across the 169-apartment project opposite Princes Park.

<a href="https://www.apartments.com.au/builders/mirvac-construction">Mirvac Construction</a> Project Manager Sam Payne said the latest update reflects a transition from structure to refinement.

“Since our last update, all façade panels have been installed and the scaffolding and gantry has come down, unveiling the building in its full form for the very first time,” Payne said.

“A significant milestone was reached this month with the removal of our final tower crane, signalling the completion of major structural works and a pivotal step forward in the building’s transformation.”

[smartcode_project:default project_id=4802 project_image_fid=366856]

Apartments are now well advanced internally, with joinery completed to level eight and tiling to level six, alongside the delivery of a prototype apartment used to set the benchmark for the remaining residences.

This next phase coincides with the release of a completed furnished residence, styled by MCM House, and the introduction of private buyer tours, giving purchasers a clearer understanding of the finished product ahead of settlement.

<a href="https://www.apartments.com.au/new-apartments/prince-parade-by-mirvac-brunswick-701-park-street-brunswick-vic-3056">Prince &amp; Parade</a> will comprise 169 one to four-bedroom apartments, with completion targeted for early spring. Interiors focus on natural materials and muted tones with two design schemes, while kitchens and bathrooms adopt a restrained palette anchored by stone, timber and textured finishes.

Bates Smart Director Jeffery Copolov said the project reflects a shared design direction centred on liveability and sustainability.

“Blending Mirvac and Bates Smart’s focus on wellness and sustainability, <a href="https://www.apartments.com.au/new-apartments/prince-parade-by-mirvac-brunswick-701-park-street-brunswick-vic-3056">Prince &amp; Parade</a> offers a new kind of conscious, elevated living in Melbourne’s inner north,” Copolov said.

<a href="https://www.urban.com.au/new-apartments/prince-parade-by-mirvac-brunswick-701-park-street-brunswick-vic-3056">Prince &amp; Parade</a> presents Mirvac's third parkside collaboration with&nbsp;<a href="https://www.urban.com.au/architects/bates-smart">Bates Smart</a>&nbsp;in Victoria.&nbsp;Their previous collaborations delivered two of the city’s landmark apartment buildings: The Melburnian opposite Kings Domain and The Eastbourne on Fitzroy Gardens.

[smartcode_project:default project_id=4802 project_image_fid=366857]

A key focus of the development is its landscape-led amenity offering. The central courtyard, spanning around 600 sqm, will feature established trees and planting grown off-site, alongside communal lawns and seating areas designed for everyday use.

Development Manager James Gardner said the outdoor spaces are central to the project’s lifestyle positioning.

“<a href="https://www.apartments.com.au/new-apartments/prince-parade-by-mirvac-brunswick-701-park-street-brunswick-vic-3056">Prince &amp; Parade</a> isn’t just a home, it’s a complete lifestyle offering, and the resident amenity is just one example of the elevated living experience the soon-to-be-complete building will be known for,” Gardner said.

The courtyard connects to a series of shared indoor and outdoor spaces, including a residents’ lounge, dining room, library and secondary west-facing garden area, designed as extensions of the apartments themselves.

Located directly opposite Princes Park and around four kilometres from the CBD, the development places residents within one of Melbourne’s most established inner-north precincts, with access to open space, transport and the retail and hospitality offerings of Brunswick and Carlton.

With façade works complete and landscaping and final finishes now underway, <a href="https://www.apartments.com.au/new-apartments/prince-parade-by-mirvac-brunswick-701-park-street-brunswick-vic-3056">Prince &amp; Parade</a> is moving into its most active construction phase, with permanent services and external works to be finalised in the coming months ahead of completion in spring.

[smartcode_project_cta:default project_id=4802]

Mirvac’s latest landmark, Prince & Parade Brunswick, enters final construction phase

Boutique Perth developer ADC has unveiled its latest project.

The developer, which focuses on bringing apartments to some of Perth's most premium inner-city and riverside suburbs, has launched <a href="https://www.apartments.com.au/new-apartments/mos-lane-mosman-park-46-manning-street-mosman-park-wa-6012">Mos Lane</a>, 68 luxury apartments and townhouses in the heart of <a href="https://www.apartments.com.au/developments/mosman-park-wa-6012">Mosman Park</a>.

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Alongside the one-, two-, three- and four-bedroom apartments, the development will also include five two-level townhomes and two luxe penthouses. ADC is also introducing a significant retail offering for residents through Mos Lane Village, which will feature a wellness studio, fish and chips shop, barber, and florist, adding a layer of amenity not typically found in the predominantly residential Mosman Park area.

Construction has already commenced on the project, which sits just a short walk from the Swan River, Mosman Park Bowls Club, and Mosman Park Golf Course.

House Agency Directors Tom House and Lachlan McDonald say they are fielding the majority of buyer interest from local downsizers, as well as buyers with a long-standing affinity for Mosman Park.
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[smartcode_project:default project_id=148957 project_image_fid=364591]

Mos Lane will comprise two buildings; Samson House and Manning House, which have been designed by&nbsp;<a href="https://www.apartments.com.au/architects/nelson-koo">Nelson + Koo</a>, an emerging design consultancy specialising in the masterplanning and design of mixed use places and spaces.

The two buildings adopt distinct architectural responses to their surroundings. Manning House references the strong roof forms of nearby homes, with floorplates oriented to maximise light and long-range views, while Samson House is organised around a central atrium designed to bring daylight deep into the building and create a greater sense of openness.

At ground level, the inclusion of five townhomes introduces a typology more commonly associated with Mosman Park’s established streets, each with private courtyards and direct frontage, offering a transition between traditional housing and apartment living.

[smartcode_project:default project_id=148957 project_image_fid=364103]

Interiors have been led by Melbourne-based Hecker Guthrie, with an emphasis on practical, long-term liveability. Residences incorporate sculpted joinery, generous storage and flexible multi-purpose rooms that can adapt to changing household needs, whether for working from home, guest accommodation or additional living space.

Material selections draw on a restrained palette of textured stone, timber and neutral tones, with options for lighter or darker schemes. Detailing such as fluted glass, full-height joinery and integrated appliances is intended to balance functionality with a more refined residential finish.

Outdoor spaces are a consistent feature across the development, with balconies and terraces designed for dining and entertaining, and larger apartments incorporating outdoor kitchens. Orientation has been considered to allow residents to choose between morning or afternoon sun, while mature street trees and landscaped communal areas contribute to a softer streetscape.

[smartcode_project:default project_id=148957 project_image_fid=364107]

Shared amenities are positioned to support both day-to-day convenience and occasional use. These include a private dining room with a caterer’s kitchen, alfresco entertaining areas, and a bookable guest suite for visiting friends and family. Additional practical features such as a resident workshop, storage facilities, car and pet wash areas, and concierge-style services for cleaning and dry-cleaning collection reflect a focus on usability.

Positioned between the Swan River and Cottesloe Beach, and within reach of schools such as Iona Presentation College and St Hilda’s Anglican School, the development is aimed at a broad buyer group, from downsizers seeking a lower-maintenance alternative to larger homes, through to local residents looking to remain in the area in a different housing format.

Mos Lane represents one of the more significant additions to Mosman Park’s limited pipeline, combining new housing supply with a village-style retail centre in a suburb where opportunities for large-scale redevelopment are relatively constrained.

[smartcode_project_cta:default project_id=148957]

Living village precinct set for Mosman Park as ADC launches Mos Lane

An entity linked to I&amp;D Group Founder Ivan Filipović has filed plans for a new residential development at 188–202 Swan Street in Cremorne, targeting a prominent site within the tightly held Swan Street activity corridor.

The proposal seeks to redevelop the consolidated Swan Street landholding into a <a href="https://www.apartments.com.au/new-apartments/188-202-swan-street-cremorne-vic-3121">high-density mixed-use project</a>, replacing a series of existing commercial buildings with a significantly scaled residential outcome. The planning submission positions the development as a response to increasing demand for housing in well-connected inner-urban locations, particularly within established activity centres.

Plans outline the construction of a 14-storey building delivering 165 apartments above a four-level basement, alongside a ground-floor retail and commercial offering designed to activate the streetscape. A key feature of the scheme is a new north–south pedestrian link connecting Swan Street to Railway Place, intended to “enhance permeability and provide an active, publicly accessible connection through the site.”

<img alt="First Look: Plans lodged for Ivan Filipović-linked Cremorne apartment project on Swan Street" data-entity-type="file" data-entity-uuid="7332a8f8-dd2b-483d-b86e-320658838c84" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/cremorne.png?VersionId=cXm8vAaRdHh.LpYVbecrRkjckgu9mtAF" />

The development will retain part of the existing built form at 198–200 Swan Street, while the remainder of the site will be cleared to accommodate the new structure. Basement levels will provide 196 car spaces and 113 bicycle spaces, with vehicle access from Railway Place. Communal amenity is distributed across the building, including a shared outdoor area on Level 1 and a rooftop terrace for residents.

Ground level uses include retail tenancies fronting Swan Street and the pedestrian link, a residential lobby, and a flexible commercial space positioned to support community-oriented uses. The planning report notes this space “could be offered as a flexible space within the development for community groups,” supporting short-term or longer-term occupancy arrangements.

<img alt="First Look: Plans lodged for Ivan Filipović-linked Cremorne apartment project on Swan Street" data-entity-type="file" data-entity-uuid="8208bf7b-cc67-485d-ad0f-1d73a74c907f" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/cremorne%20lane.png?VersionId=69ctjC0txXv0zCHy7qQUpJyGwvPAT7gw" />

The site sits within the Swan Street Major Activity Centre, surrounded by a mix of retail, hospitality, and emerging residential development, and directly opposite tram services along Swan Street. East Richmond Station is located to the south, providing strong rail connectivity, while the broader Cremorne precinct continues to evolve as a mixed-use hub.

I&amp;D Group, founded by Ivan Filipović, is regarded as one of Victoria’s largest formwork contractors, partnering with major construction firms across large-scale public and private developments. The Swan Street proposal signals a move into development-backed opportunities tied to strategic inner-city sites.

First Look: Plans lodged for Cremorne apartment project on Swan Street

Darling Downs

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Larrakeyah, an expansive rural Talgai homestead in Queensland’s Darling Downs region, has been listed for sale.
Located at 111 Donovan Road, the estate is set on 175ha of fertile farmland and includes four Queenslander homes that were transported more than 175 kilometres.
<a href="https://www.realestate.com.au/property-house-qld-talgai-134533358" target="_blank">The 860 sqm Talgai residence</a> includes 23 rooms, five wood-burning fireplaces and a generously proportioned veranda.
Its offerings include seven bedrooms, three bathrooms, views to the Great Diving Range, and rows of garden beds, as well as two kitchens, one domestic and one commercial.
The commercial kitchen includes stainless steel benchtops, three refrigerators, a restaurant-quality gas stove, and a walk-in larder.
Sotheby’s International agent Michael Vettoretto is be marketing the property.
"It has the potential to be anything the owner wants," he said.
The home’s eastern wing has potential to be operated as an Airbnb-styled accommodation with a spacious living room, kitchen, bathroom, two bedrooms and a private entrance.
"The seven bedrooms mean if someone wanted to buy it with the intention of turning it into a unique homestay, they would be able to", Vettoretto said.
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j.ballantyne1990-6AQqhLzZaK

Larrakeyah, luxury rural homestead in Queensland's Darling Downs listed

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Confidence in the Darling Downs region market has been boosted by winter rainfalls, says the latest rural report from valuation firm Herron Todd White.
A good winter crop and strong herd numbers leading into the summer months is expected.
The positive farming conditions follow severe drought in 2018 and 2019 that saw cattle and sheep numbers drop.
HTW director Bradley Neill writes: “2020 has provided far better farming conditions and with that has come strong appetites for rural property.”
According to the report, sale prices continue to exceed pre-sale expectations.
Numerous transactions show significant price premiums over district averages, driven by private farming families and interstate cattle and sheep producers.
The recent sale of a 22,000ha holding in the Adavale Quilpie district shows a 19 per cent increase in value over a 14-month period.
A new benchmark has been set for Brigalow and Belah dryland farming country in the Darling Downs region following the sale of the broadacre farming property, Manus.
<img src="https://www.urban.com.au/images/Screen%20Shot%202020-09-10%20at%2011.09.50%20am.png" alt="">
The Manus property.
The land recently changed hands for approximately $10 million, $3,960 per hectare.
The market is favouring sellers at the moment, who are presenting their properties to the market in conditions not seen for a number of years.
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The Darling Downs rural market prices exceed expectations: HTW Rural

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The financial viability and challenging Australian climate have forced some long-standing grazing models to evolve in the Darling Downs region, and, therefore impacted the property market, according to the latest rural report from valuation firm Herron Todd White.
A transition towards trading cattle is expected to allow greater turnover and spreading cash flow, however the report found that the recent spike in cattle prices has created some anxious caution in the market.
“Where we are also seeing some conservative buying despite ability to run higher numbers but in some cases trying to spread risk through providing agistment on surplus country,” the firm said.
The rural market in south-east Queensland is starting to witness a slight increase in the number of listings on the back of much needed rain after prolonged drought.
“We are expecting the strong demand to continue as any potential purchasers prior to the rain would view assets more favourably now that they have the ability to stock,” the firm added. At this stage the continued strong demand will likely create a firming in values in the short term until supply equalises buyer demand particularly for grazing assets.
The broadacre farming market has seen unprecedented level of buyer demand, especially towards the back end of 2019, when the drought was impacting on market confidence and, despite the rain, cash flow won’t exist until crops are harvested.
As we are seeing the country go into lock down due to the Coronavirus, this will have an impact on many business and financial markets. To a large degree, the agricultural sector has been insulated from its effects to date, however the ability to source fertilisers, chemicals, parts, labour etc will likely be affected at some stage.
Further risk will also be created by any uncertainty in the financial markets, which will ultimately have the potential to create low investor confidence.
“On the upside, agricultural investments will likely be viewed more positively by investors seeking tangible assets underpinned by the world still needing to feed itself,” the firm added.
A recent pending sale north-east of Dalby, comprising Bottle Tree softwood scrub merging to Ironbark grazing block was placed under contract following three inspections within the first week of listing and reflected circa $5,100 per hectare excluding structures.
The pending sale reflects the continued strong demand evident in the market for smaller scale assets.
Further west near Roma, the market remains strong with the sale of Iona, a 1,543 hectare holding south of Wallumbilla for $6.4 million ($4,148 per acre) to a neighbour at auction.
The full “Month-in-Review” Herron Todd White report for April can be found <a href="https://static.htw.com.au/HTW-month-in-review-April-2020-Rural.pdf" target="_blank">here.</a>
Note regarding COVID-19
 
This edition of Month In Review had its topic defined in late February with submissions from our offices collated through to late March. During this period, shifts in the social and economic landscape due to COVID-19 became increasingly dramatic, as demonstrated by the varied information provided by offices over the course of three weeks.
 
This month’s residential theme on baseline property market drivers remains a common thread, and provides an indication of what influences to monitor as the property sector recovers post-crisis.
 
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wdavis-8cCN98p7xp

Darling Downs region marred by "anxious caution" but slowly gaining ground: HTW rural

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An increase in listings across the western Darling Downs, Maranoa and northern New South Wales regions has been observed over the past two months, according to the June Herron Todd White (HTW) residential report. 
The valuation firm looked at the influence of trade wars, pandemic outcomes and commodity prices on the rural sector, and provided an update of how rural real estate is performing across locations and industries. 
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The report notes agents are reporting that sellers are looking to capitalise on the good bodies of feed now on the ground following years of drought.
Strong re-stocker demand continues to support high cattle prices, which are underpinning grazing land values.
"The cattle market remains strong despite the country now haying-off in most areas and should the good rain forecast over the winter fail to eventuate, the body of feed currently available runs the risk of spoiling," the valuation firm said. 
In the Darling Downs region, many farming operators are holding off planting until receiving beneficial rain to provide a full moisture profile.
As supply increases, there is strong potential for a softening in market sentiment as the pool of potential buyers is absorbed, the report noted. 
The impacts of the barley tariffs and Australian meat export restrictions by the Chinese government may reduce buyer confidence, however these effects may take some time to play out.
Some recent listings in south-east and south- west Queensland include:
◗ Telco, Roma (pictured below) -939.5 hectares-to be auctioned 18 June
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2020/7/13/roma%202.jpg" alt="">
◗ Dunkery, Condamine-2944 hectares-to be auctioned 11 June
◗ Spring Grove, Roma-2496 hectares-to be auctioned 2 July
◗ Wattlevale, Moonie-3138 hectares-EOI
◗ Lesdale, Charleville-14,827 hectares-EOI ◗ Murilla, Meandarra-7655 hectares-EOI
◗  Nungil, Charleville-14,524 hectares–to be auctioned 17 June
◗  Tomoo, Mungallala-18,215 hectares-private treaty after being removed from auction terms
◗  Mundibulanga, Drillham-2678 hectares-EOI
◗  New Cashmere, St George-4458 hectares-EOI
◗  Greenoaks, Mitchell-5100 hectares–auction held 22 May
◗  Yambutta, Quilpie-41,083 hectares–to be auctioned 13 July
◗  Whyenbirra, Bollon (pictured below)-14,358 hectares-to be auctioned 18 June
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2020/7/13/bollon.jpg" alt="">
◗  Terrica aggregation, Texas-15,990 hectares-EOI
◗  Kilto, Wandoan-4042 hectares-EOI
Recent sales include:
◗  Cooraki, Surat-2128 hectares-sold $3.85 million ($1809 per hectare)
◗  Glen Lindon, Injune (pictured below)-2627 hectares-sold $3.4 million ($1294 per hectare)
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◗  Oban, Jimbour Plains-377 hectares-sold at auction $4.705 million ($12,599 per hectare)
In summary, the market may be approaching a tipping point where the strong increase in listings may see values stabilise following a period of strong growth, the report noted. 
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Darling Downs rural market approaching the tipping point: HTW rural 

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Market activity in Darling Downs has slowed significantly over the past six to eight weeks as a result of COVID-19, according to the June Herron Todd White (HTW) residential report. 
The valuation firm suggests that in locations across the nation, the downtime delivered by isolation has spurned on owners looking to improve their assets through maintenance and upgrade. This month's HTW residential report highlights where renovations are on the rise and the price points and outcomes those markets can expect.
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The report notes many vendors withdrew their properties from the market during the initial shut down period and many selling agents are now reporting having limited stock on the market.
Selling agents are also reporting that genuine buyers are still active in the market (ie. those who had sold just prior to the COVID-19 shutdowns and need to buy elsewhere or government employees relocating) and cash buyers are beginning to emerge, seeking the opportunity for a good buy.
The restriction on open homes for several weeks resulted in selling agents receiving genuine buyer enquiry rather than sticky-beakers. Open homes have re-commenced in the past week and agents are reporting moderate attendance so far.
In the broader Darling Downs region, property managers are still reporting good demand for rental properties, the report noted. 
There is limited short-term rental accommodation homes in this region and accordingly, it has been somewhat insulated from an influx of short-term letting properties such as those listed on AirBNB coming back on to the long- term rental market.
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"Commentary has been made by both CoreLogic and realestate.com.au representatives regarding the potential for increased demand for properties within a two hour radius of capital cities after COVID-19, due to buyers seeking a lifestyle change to less crowded regional areas and with new work from home routines having been established.
"This applies to many areas within the Darling Downs region and is cause for optimism in our area," the valuation firm said. 
Renovate your way out
There has been a significant growth in property owners undertaking extensive renovation projects in recent years, possibly driven by television shows such as The Block.
In the Darling Downs region, this is particularly evident in the city of Toowoomba, the report suggested. 
"The well regarded and sought after suburb of East Toowoomba has seen a significant amount of home-owner renovations in recent times," the valuation firm said. 
A majority of properties in East Toowoomba are older, character timber dwellings and there has been a noticeable increase in the number of these properties being brought back to life. 
Some note-worthy renovations for this locality have maintained the original cottage style façade but have been extended to the rear with two level, contemporary style additions.
"There have only been a few renovations carried out in this style so far in East Toowoomba and they have generally been completed by owners of local, custom building groups as their own personal residence and then on-sold.
"Therefore, it is difficult to comment on the profitability of carrying out such an extensive renovation. In many cases, this has created a great deal of interest in those particular builders and resulted in additional renovation projects for them to complete for paying customers," the valuation firm said. 
An example provided by the valuation firm is a fully restored and renewed home in East Toowoomba. 
The four bedroom, two bathroom home at 31 Cavell Street (pictured below) was sold for $810,000 in 2019. 
The home comes with tiled bathrooms, covered alfresco area and terrace, private courtyard and rear studio space. 
The original features include high ceilings and black stained timber flooring. 
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Well-renovated character dwellings in East Toowoomba are generally in the $750,000 plus price bracket, depending on the size and features of the dwelling, ancillary improvements such as pools and particularly the land size.
Renovation costs are currently quite high and in many cases, the cost of completing an extensive renovation is not reflected as added value on a dollar for dollar basis, the report noted. 
Nearby suburbs such as Mount Lofty and North Toowoomba are also seeing some renovation of older timber homes, but to a lesser extent than that of East Toowoomba.
"There is significantly less home renovation being carried out in the lower price brackets and in other suburbs across Toowoomba. We also note that there is limited renovation activity in our regional areas such as Warwick, Stanthorpe, Gatton, Kingaroy and Dalby," the valuation firm said. 
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Extensive home renovation projects grow significantly in the Darling Downs region: HTW residential 

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Hot and windy days are compounding the dry conditions in the Darling Downs region, according to the latest Herron Todd White (HTW) rural report.
"In our travels, many landholders frequently ask where the driest part is observed.
"In my opinion, it would have to be in the south-east corner to south of Toowoomba through to Stanthorpe," the valuation firm said. 
Many paddocks that were once grazing now appear as fallow cultivation country due to being eaten out to bare ground.
The report notes a real concern should it rain is the potential impact of significant soil erosion due to very little ground cover - much of the country has turned to a fine powder.
The latest Bureau of Meteorology climate outlook statement for November to January indicated the chance of receiving above median rainfall for the south-east is between 25 and 30% and slightly better moving west where the Balonne Shire is 40 to 50%.
For graziers in the south-east and particularly in the Southern Downs region, where the majority of stock water requirement is provided by surface water only, the outlook is becoming desperate as dams are drying up rapidly.
With the dry seasonal conditions, it is now evident that this is impacting on market confidence with very few transactions of scale in the south-east region.
One sector of the market that has shown improvement in the liquidity is in far western Queensland and primarily those holdings benefiting from either rain or flood waters from February and March events further north.
Market activity in the Paroo, Quilpie and Barcoo Local Shires over the past eight months has increased on the back of improved seasonal conditions.
The purchasers are a combination of local and outer district landholders seeking additional country, but the major market driver is those seeking grass.
"The increase in buyer demand has created a broad firming in value trends over a relatively short period. This trend may consequently soften should further follow-up rain not be received this summer, where any firming in values observed in the short term maybe attributed to those grass purchases," the valuation firm said. 
Some recent transactions in the region include:
◗ Clifton Station, Windorah (pictured below) - a 48,800 hectare holding under contract;
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◗ Canaway Downs, Eromanga (pictured below) - a 93,316 hectare holding selling for $8.137 million in May;
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◗ Coniston, Windorah (pictured below) - a 28,500 hectare holding under contract;
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◗ Retreat, Windorah - a142,601 hectare holding reportedly sold for $20 million including stock and equipment.
"We are also aware of a pending sale in the Cunnamulla region that will show the continuing strengthening for river frontage country, with further details to be provided when publicly available," the valuation firm said. 
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Dry seasonal conditions impacting market confidence in Darling Downs: HTW rural  

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Investors in the Darling Downs have generally been attracted to low-maintenance properties such as new or near new four-bedroom, two-bathroom, two-car detached dwellings, two-bedroom units and six-bed, four-bath duplex pairs, according to a recent Herron Todd White (HTW) residential report. 
The valuation firm took a look at rental yields across the nation. 
The report notes the majority of the Toowoomba investor market tends to operate in the sub-$400,000 segment for dwellings, sub-$300,000 for units and sub- $550,000 for duplex pairs. 
"It’s unclear whether investors are favouring strategies to seek higher yields or focusing on capital gains," the valuation firm said. 
With a slow-moving market at present, investors are possibly seeking a blend of the two strategies.
Some of the western suburbs such as Glenvale, Cotswold Hills and Cranley, and outer lying satellite suburbs including Wyreema and Cambooya have tended to be hot spots for investor activity over recent years.
This is most likely a result of englobo land availability, with the established suburbs unable to accommodate new development.
The report notes yields in these newly developed areas are moderately attractive to investors at circa 4% to 5% for houses and 5% to 6% for units and duplex pairs, however these returns may come at the expense of capital growth.
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Buyers seeking to invest in the Toowoomba area could consider purchasing in older suburbs close to the CBD such as Centenary Heights, Darling Heights, Kearneys Spring, Newtown, North and South Toowoomba. 
These areas still generate acceptable yields and arguably have greater potential for capital growth due to their proximity to the CBD and services.
 A recent trend within the established suburbs in areas close to boarding schools, hospitals or the CBD is short term letting utilising platforms such as Airbnb and Booking.com. 
"We have witnessed yields up to and exceeding 10% in select cases, however this comes with intensive management, including managing bookings, financial management and very regular and intensive cleaning," the valuation firm said. 
The smaller towns throughout the broader Darling Downs region can show higher yields anywhere from 5% to 10%. 
Once again, these higher returns come with a higher degree of capital growth risk.
"Investor interest in Toowoomba and surrounding areas has significantly slowed over the past two years resulting in a reduction in sale volumes, however vacancy rates have declined to sub-2% and rental rates have shown moderate growth. This may lead to an increase in investor activity throughout the Toowoomba region." 
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Darling Downs/Toowoomba investors attracted to low-maintenance properties: HTW residential 

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The Federal Government’s proposed buy back of underground water within the Upper Condamine Alluviums may now result in the creation of a new peak in the cycle of the market, according to the latest Herron Todd White (HTW) rural report. 
Owners of groundwater now have the opportunity to sell part of their entitlements back to the Government under the “Restoring the Balance in the Murray-Darling basin” program. This is ground water that they have not historically been able to access and are unlikely to ever be able to access going forward. The end result will be a win for the farmers and this will create three options for them:
• Payback Debt;
• Further develop existing on farm infrastructure; or
• Further capital acquisitions.
The Government Proposal
Under the “Restoring the Balance in the Murray- Darling Basin Purchasing Program”, the Australian Government has committed $3.1 billion to purchase water for environmental purposes. This program is part of the Sustainable Rural Water Use and Infrastructure Program. On 2 June 2014, the Australian Government released the Water Recovery Strategy for the Murray-Darling Basin. The strategy outlines the Government’s approach to recovering water for the environment in the Murray-Darling Basin, whilst maximising positive outcomes for farmers and communities. This includes prioritising water recovery through infrastructure investment over water purchasing which is limited to 1,500Gl.
It is quite obvious that to date the Government’s approach was not working and a new way had to be tried as less than 8% of the target SDL has been achieved with the majority of this coming from the Central Condamine Alluvium.
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Further Initiations
On 19 April 2018, the Federal Government subsequently opened a new tender round to voluntarily acquire groundwater back from farmers within the Upper Condamine Alluviums. They subsequently undertook a new approach by announcing the maximum price at which they are prepared to acquire water. This differs from previous tenders whereby no such price announcements were made.
If we look at the Central Condamine Alluvium (CCA) which involves the bulk of the water buy back volumes (currently 86,066Ml of Nominal Entitlement which will be reduced to a maximum of 37,409Ml or 43.5% of the current nominal volume), we understand that all licence holders will be initially geared down to the equivalent of 50% of their Nominal Allocations with that then reduced by a further 13% in order to achieve the target of 37,409Ml.
Within the CCA, there are multiple sub areas and currently the long term average Announced Allocations of the respective Nominal Allocations are included here.
This will ultimately mean therefore that all holders of groundwater licences within the CCA (apart from those within Sub Area 2 (3) and Transitional Zone 3 (3) which are already on 50% restrictions) will potentially lose a further 20% of their allocations over time so as to allow the government to meet its target.
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Variation to Previous Tenders
However this tender now appears to differ from previous tenders or individual private sales of groundwater in that the Federal Government will effectively buy the unusable portion of a right.
For example, if we assume that a groundwater licence holder within Sub Area 2 (3) had a nominal allocation of 1,000Ml, historically they have only been able to access 50% of this right. If they decided to sell a 50% share, they would be left with 500Ml, but would still only be able to access 50% of that remaining right or 250Ml going forward.
Now, subsequent to the announcement of this tender, it appears the farmer will be able to utilise the full 100% of the remaining 500Ml and will receive a maximum price of $1,950 per Ml for the 500Ml they sell to the Federal Government. Their position going forward will remain unchanged in that they will continue to gain access to 500Ml of groundwater per annum but will potentially have a one off windfall of $975,000 (500Ml @ $1,950/Ml).
In relation to the other sub areas however, where announced allocations are higher than 50%, the position will be slightly different. For example, within Sub Area 2 with an announced allocation of 70%, a farmer with a nominal allocation of 1,000Ml has historically been able to access 700Ml only. Previously if they sold 50% of that right, they would only continue to be able to access up to 70% of the remaining 500Ml or 350Ml.
Now if they sold 50% of their right, they will be paid $2,000Ml for the 500Ml, but the net effect of the sale will see their water right reduce from 700Ml to 500Ml, a loss of 200Ml which they can no longer access going forward. They will still have a one off windfall, but not to the same extent.
The end result will be that over the next period as this voluntary tender progresses, many farmers will receive a one off cash injection if they decide to sell part of their rights to the Federal Government. This will provide a cash injection into the market which could see the market continue on its upward projection somewhat longer than it may have otherwise done.
Peak of the Market
In summary, we have seen exceptional growth in the value of quality farming country over the past two years or so on both the Bongeen and Jimbour Plains. Now whilst there is a level of discussion within the market place broadly that we may be approaching the peak of this market cycle, it is perhaps too early to call this within this location. Given the nature of the underlying lands, the fact that “they just don’t make this country anymore” and the potential for the Federal Government to inject a one off financial boost into the local market through the buyback of groundwater, there still may be further potential for growth to occur within this particular market sector, notwithstanding the current dry conditions and the poor winter crop outlook.
A recent sale is a Rosenthal Heights lifestyle block which was traded for $960,000 (pictured below).
Located just 7.5 kilometres from Warwick's CBD, <a href="https://www.realestate.com.au/sold/property-lifestyle-qld-rosenthal+heights-7884590" target="_blank">184 Warner Street </a>is elevated slopping land with views.
The home features four bedrooms, lounge, dining and family room, kitchen and plenty of storage space. 
It is operating piggery with a contract at $5,543 plus GST per month.
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Another example is a Clifton property, Avonlea, which was sold for $650,000 (pictured below).
It was formerly a horse stud and spelling farm on the doorstep of the renowned Pilton Valley.
<a href="https://www.realestate.com.au/sold/property-lifestyle-qld-clifton-7943370" target="_blank">Located at 4843 Clifton Gatton Road</a>, it comprises of 100 acres of well established thriving natural pastures and 30 acres under cultivation. 
Other features include three bay hay sheds, machinery shed, large day yards, and water supply to all paddocks except cultivation.  
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Government proposal may trigger new peak in Darling Downs rural property: HTW

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Glenbank, a 236-hectare property on Darling Downs has sold for $2.52 million to a local businessman, equating to about $10,640 per hectare.
The prior nearest price for similar size and quality property in the Brookstead area was about $9880 per hectare, Ray White noted.
Ray White Rural Pittsworth's James Croft said there was "exceptional competition" <a href="https://www.realestate.com.au/sold/property-mixed+farming-qld-brookstead-7963674" target="_blank">at the auction</a> after 20 inquiries, 12 inspections and 11 registered bidders.
"The bidding was frenzied," Croft told Fairfax Media.
It was fuelled by commodity prices with sorghum at $400 a tonne and cotton at $600 a bale.
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Glenbank on the Darling Downs sells for $2.52 million

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Southern Queensland's Darling Downs region has seen an increase in auction listings in late June to mid July following the winter plantings, according to analyst firm Herron Todd White.
HTW said due to the local region now entering the mid-season selling period a lull in the market will pop up albeit normally on a temporary basis.
"Given this, we do note that there has been an increase in listings in the region, with some set down for auction in late June to mid-July after winter plantings have occurred," HTW said.
"It will only be at that point that we will really be able to determine if the broader market has the appetite for further investment going forward.
"Testing this appetite, within the highly regarded salad bowl region to the south east of Cunnamulla, we note that the holdings of Clover Downs (125,288 hectares) and Noorama (105,000 hectares) together with an aggregation of another eight holdings comprising a total area of 127,192 hectares have all recently come onto the market under expressions of interest campaigns.
"All three are managed by different agencies and it will be interesting to see the individual (or collective) approaches taken by those relevant agencies in order to achieve a sale within a reasonable period of time.
"Together with a further two nearby smaller holdings (Camden comprising 32,448 hectares adjoining Clover Downs and Robina Downs to the south comprising 13,780 hectares) the total amount of country now on the market in the region is in excess of 400,000 hectares or one million acres.
"There is the potential that a new corporate could see an opportunity to secure a large chunk of some of the best country in the region. Whether there is the appetite for such an approach is yet to be seen.
"The wool industry has remained quite resilient, however offsetting this is the ongoing problem of kangaroo and wild dog build ups.
"As valuers, we always refer to the depth of the market and the impacts on the value of a particular holding or group of holdings within a region.
"The scenario that has now emerged involving such a volume of country in a relatively small geographical region will surely test that aspect.
"A large number of holdings on the market in a de ned region would normally be expected to raise concerns around industry issues and why there is such an exodus from the region. However two of the major holdings are owned by corporates that for varying reasons have decided to sell their holdings and given this is pure coincidence, we have perhaps witnessed the development of the perfect storm."
A 3349ha Freehold property at nearby Roma, 1444 Glen Arden Road, (above) recently sold, price undisclosed. It features two 4 bedroom homesteads with sheds, workshops and silos as well as bores and dams.
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