In Melbourne’s established inner east, the qualities that define a traditional house, width, height, and access to open ground, are increasingly difficult to replicate in new residential developments. Larger landholdings are scarce, and with them, the ability to create apartments that extend beyond compact, internalised layouts.&nbsp;

In <a href="https://www.apartments.com.au/developments/kew-vic-3101">Kew</a>, where the residential fabric is shaped by generous setbacks and mature tree canopies, that tension is especially visible.

<a href="https://www.apartments.com.au/developers/ricdanic-investments-pty-ltd">Ricdanic</a>&nbsp;is bringing forward a boutique collection of just 13 residences across two buildings at 9–11 Wimba Avenue, Kew. Comprising six homes at No.9 and seven at No.11, the project sits on a quiet, tree-lined street just off Cotham Road.&nbsp;

Each apartment has been planned with a level of independence more commonly associated with standalone dwellings, balancing privacy with the efficiencies of apartment living.

Architect Chris Idle, who has been practising for over two decades, says projects like this don’t come along often.

“There are very few opportunities to do these kinds of developments in leafy, established suburbs,” he explains. “To get this level of amenity, natural light, and architectural freedom in such a setting is extremely rare.”

[smartcode_project:default project_id=140755 project_image_fid=366267]

The internal planning begins with width. Living areas extend beyond five metres, allowing furniture, circulation, and glazing to sit comfortably within the same zone without compression. Ceiling heights shift from three metres through to five metres in select areas, changing the sense of scale as you move through the apartment. These proportions are paired with double-glazed windows and fully electric systems, balancing volume with performance, supported by a 7.2 NatHERS energy rating.&nbsp;

From the main living space, the apartments open directly outward. Large sliding doors connect to private gardens averaging 125 square metres, with some residences also incorporating balconies of around 60 square metres. Rather than acting as secondary outdoor zones, these areas sit flush with the internal floor level, extending the usable footprint of the home and allowing for multiple modes of use, whether for quiet daily routines or larger gatherings.&nbsp;

The landscape, led by <a href="https://www.apartments.com.au/landscape-architect/john-patrick-landscape-architects">John Patrick</a>, reinforces this relationship. Across the site, 23 different plant species have been introduced, including a mix of native and established varieties, arranged to maintain privacy while preserving sightlines and light access. Gardens are not treated as decorative buffers but as functional extensions of the apartments, shaped to accommodate movement, seating, and informal use over time.&nbsp;

[smartcode_project:default project_id=140755 project_image_fid=366265]

Architecturally, the project draws from Kew’s historic residential language. Handmade bricks by Krause define the exterior, grounding the buildings within the material palette of the suburb, while interior finishes, stone, timber flooring, and restrained detailing, continue this approach internally. Architect Chris Idle describes the intent as long-term rather than stylistic: “We wanted it to feel timeless.”&nbsp;

This emphasis on durability extends to how the buildings are accessed and secured. Entry is managed through keyless systems, with a double-gated basement incorporating number plate recognition for vehicle access. Each residence is paired with a private lock-up garage accommodating two to three cars, alongside storage, while all entry points are monitored continuously. These measures sit alongside EV readiness and fully electric infrastructure, aligning the project’s operational systems with its long-term design outlook.&nbsp;

The setting remains central to how the development is experienced. Located within walking distance of Kew Junction and close to established schools including Carey Grammar and Xavier College, the address benefits from existing infrastructure while maintaining a residential quietness that is increasingly difficult to find at this scale.&nbsp;

Construction is being delivered by <a href="https://www.apartments.com.au/builders/sinjen">Sinjen</a>, with a 10-year structural guarantee, with completion targeted for mid-2027.

[smartcode_project_cta:default project_id=140755]

Joel Robinson

Inside Wimba Ave, Kew’s garden-scale residences designed for space and permanence

High-end Sydney developer&nbsp;<a href="https://www.apartments.com.au/developers/abadeen-group">Abadeen</a> has secured approval for one of its latest Mosman projects, one of the first developments approved by Mosman Council under the NSW Government’s Low and Mid-Rise Housing Policy.

The approval represents an important step in delivering well-considered housing next to established village locations on Sydney’s Lower North Shore, in line with the intent of the Low and Mid-Rise zoning framework. 
&nbsp; 
There are currently 13 other sites lodged within Mosman Council under the policy, with <a href="https://www.apartments.com.au/new-apartments/27-29-heydon-street-mosman-nsw-2088">Heydon Street</a> among the first to receive development consent. 
&nbsp; 
Abadeen Founder and Executive Chairman Justin Brown said the project reflects a considered and appropriate response to its planning context. 
&nbsp; 
“This approval demonstrates how carefully considered, design-led development can align with the objectives of the Low and Mid-Rise Housing Policy," Brown said.

"The scheme has been designed to respond sensitively to its village setting, with a built form, scale and level of amenity appropriate to its local context. The determination reflects a balanced and considered planning outcome, with Council recognising the capacity for this site to accommodate additional housing within a well-located and established precinct.”

<img alt="Abadeen secures first approval under low and mid-rise housing policy for Heydon Street, Mosman" data-entity-type="file" data-entity-uuid="92811ce3-02e8-44fc-996e-c61ae039bd3e" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Heydon%20Street%20Aerial.jpg?VersionId=ZHJVuWQT64QcdrFJx963pFWFzTX7lI2I" />

The Heydon Street approval followed extensive consultation with Mosman Council, with Abadeen working closely with Council throughout the assessment process.

The approved scheme comprises 27 residences, with only four per floor, creating a low-density living environment. The building will include four half-floor penthouses designed to capture views across Middle Harbour, Sydney Harbour and the surrounding district.&nbsp;

The project is expected to appeal to downsizers and owner-occupiers seeking house-like proportions, privacy and local convenience. There will be north-facing Middle Harbour views from the second level upward. It is also just a flat 100-metre walk to Bridgepoint Shopping Centre, which will appeal to owner-occupiers and in particular downsizers.

Two-bedroom residences are expected to be priced from $1.99 million when sales launch later this year. 
&nbsp; 
Joe Tack, CEO at Abadeen, said the outcome reflects both the quality of the site and the broader need for well-located housing. 
&nbsp; 
“This is a highly considered site within a highly established local setting, offering elevated views and strong connectivity. The project has been designed to respond to that context, delivering a scale and quality of housing aligned with both the planning framework and evolving market demand.” 
&nbsp; 
“This approval is particularly significant in the context of Mosman, where new housing supply has historically been limited. While it represents the first approval of this scale in Mosman to be achieved in over 50 years, it is importantly located within a well-established residential location, in close proximity to the established commercial amenity of Spit Road and Mosman Village. It reflects strong confidence in Abadeen’s approach to design, delivery and community integration, while contributing to the delivery of much-needed housing in a highly constrained market.”

Abadeen has an established track record across Sydney’s Lower North Shore, with recent completions including KOYO in Crows Nest and ENSO in Neutral Bay.

In Mosman, Abadeen recently completed The Hampden, with Mosman Residences on the corner of Spit Road and Clifford Street scheduled for completion later this year. Construction has also commenced at Burran Residences, comprising three full-floor ultra-premium homes positioned just 50 metres from Balmoral Beach, with residences expected to achieve prices in excess of $20 million. Two further projects are also progressing through planning within the local government area.

Abadeen secures first approval under low and mid-rise housing policy for Heydon Street, Mosman apartment development

Apartment developer <a href="https://www.apartments.com.au/developers/martello">Martello™</a> is one of the latest entrants to the Gold Coast development market, with its debut project set to be one of the most boutique offerings on Chevron Island in recent years.

Martello has unveiled <a href="https://www.apartments.com.au/new-apartments/aere-chevron-island-18-20-mawarra-street-chevron-island-qld-4217">Aere Chevron Island</a>, a collection of 33 large-scale two-, three-, and four-bedroom apartments across an 18-storey building on Mawarra Street.

[smartcode_project:default project_id=143932 project_image_fid=367517]

The developer has placed a strong emphasis on wellness, briefing architecture firm Raunik Design to embed this philosophy into the project. It is a direction <a href="https://www.apartments.com.au/developers/martello">Martello™</a> plans to carry through its future developments along the coast.

<a href="https://www.apartments.com.au/developers/martello">Martello™</a> has positioned Aere as a continuation of its human-centric development approach, with a focus extending beyond amenity to the fundamentals of layout, natural light, and spatial planning. Promax Construction has already been appointed to deliver the project, with construction expected to commence in the coming months as part of the group’s broader expansion into South East Queensland.

Rising above the low-rise fabric of Chevron Island, Aere’s design emphasises generous internal proportions and uninterrupted outlooks, with residences oriented to capture coastal, skyline, and waterway views. Interiors prioritise open-plan living, with large-format glazing and carefully considered transitions between indoor and outdoor spaces.

[smartcode_project:default project_id=143932 project_image_fid=367508]

The upper levels are dedicated to larger-format homes, including four-bedroom residences designed as half-floor offerings. These layouts prioritise separation between living and sleeping zones, along with increased privacy and storage, features more commonly associated with detached housing than traditional apartment product.

Aere’s private resident amenity spaces centre on wellness. A rooftop level will incorporate a heated swimming pool, sauna and spa, while the rest of the wellness spaces throughout the building include a&nbsp;residents’ lounge, dining areas and a gym.

The inclusion of both social and quieter retreat spaces reflects a broader shift in higher-end apartment design on the Gold Coast, where developers are increasingly responding to owner-occupier demand for buildings that support long-term living rather than short-stay use.

[smartcode_project:default project_id=143932 project_image_fid=367814]

Aere is positioned within walking distance of Chevron Island’s village centre along Thomas Drive, as well as the HOTA cultural precinct via the Green Bridge, connecting residents to parklands, galleries, and event spaces.

For <a href="https://www.apartments.com.au/developers/martello">Martello™</a>, Aere represents the first in a series of planned Gold Coast developments, with the group also exploring opportunities in other coastal precincts, including Kirra and Palm Beach.

The move north comes as sustained population growth and infrastructure investment continue to reshape South East Queensland, with developers increasingly targeting boutique, design-led projects in established lifestyle pockets. Aera’s relatively small scale and emphasis on spatial quality position it within this emerging segment of the market.

[smartcode_project_cta:default project_id=143932]

Martello™ enters Gold Coast market with wellness-led Chevron Island development Aere

Development approval has been granted for Crescent, a boutique waterfront project on one of Palm Beach's most coveted and rarely developed streets.

Launched to market this month, <a href="https://www.apartments.com.au/new-apartments/crescent-palm-beach-34-36-murlong-crescent-palm-beach-qld-4221">Crescent</a> will occupy four combined lots with frontage to both Murlong Crescent and Tallebudgera Drive. The project is among the first new developments to get a green light on the creekside strip, home to only 21 tightly-held properties.

“Murlong Crescent is one of those streets that people discover and never want to leave,” said Andrew Erwin of NPA Projects, who is leading sales and marketing.

“The lifestyle here is genuinely hard to find anywhere else on the Gold Coast.”

Designed by Queensland firm ᴮʸculprit and developed by DCS Property Group, Crescent offers two and three-bedroom residences across four levels, ranging from 119 to 283 sqm and priced from $2.5 million. Builder SNBX Constructions has been appointed, with completion expected in mid to late 2028.

[smartcode_project:default project_id=151399 project_image_fid=366218]

Residences face north to Tallebudgera Creek, with views that extend to Burleigh Headland. Upper levels also capture canal and hinterland views to the west.

“The creek is tidal, so it changes constantly. The colour, the light, the mood of it,” Erwin said.

“That view over the creek to Burleigh Headland is only possibly from this location.”

[smartcode_project:default project_id=151399 project_image_fid=366213]

Crescent devotes two levels, spanning more than 1,100 sqm, to resident amenity.&nbsp; On Level 1, a gym, steam room, infrared and traditional saunas, hot spa, cold plunge, and ice bath make up the private wellness retreat. Entertaining and recreation converge on the rooftop with a resort- style pool and sundeck, alfresco BBQ and dining areas, pizza oven, yoga lawn, fire pit, as well as a herb and zen garden. Residents can also jog or walk along a dedicated loop with views over Tallebudgera Creek.

“The amenity here is genuinely out of proportion to the size of the building,” Erwin said.

“Every resident, regardless of which apartment they choose, gets access to the kind of amenity normally associated with luxury resorts.”

[smartcode_project:default project_id=151399 project_image_fid=366257]

Residences feature natural stone and timber finishes throughout, brushed brass tapware, and New Zealand wool carpet to bedrooms. Two basement levels provide secure parking, with provision for electric vehicle charging.

Beyond calm water swimming, paddling and boating, residents follow the foreshore path to Tallebudgera Beach, local cafes, and Tallebudgera Surf Club, while across the bridge is Burleigh Heads National Park, Burleigh Beach and the vibrant James Street dining and retail hub.

Palm Beach has been among the Gold Coast’s strongest performing suburbs over the past five years, with median house prices having risen by more than 91 per cent and unit values more than doubling in the same period.

[smartcode_project_cta:default project_id=151399]

Crescent Palm Beach approved as sales launch

The Albanese and ACT Governments have struck a deal to unlock nearly 5,000 new homes across Canberra, with more than 1,700 earmarked exclusively for first home buyers.

The agreement marks the second formal partnership under the Federal Government’s election commitment to deliver up to 100,000 homes for first home buyers nationally, working alongside state and territory governments and industry.

At the centre of the deal is a $250 million funding injection from the Albanese Government, targeting enabling infrastructure to bring forward new housing supply across a number of key precincts in the ACT.

That includes funding to unlock 75 homes in the Kingston precinct, support new development in Weston Creek, and deliver estate works across the territory that will facilitate more than 500 homes by 2034. Additional investment will go towards relocating powerlines, water infrastructure in Molonglo Valley, and further expansion of the Ginninderry regeneration precinct.

Housing Minister Clare O’Neil said the agreement was about making it easier for first home buyers to enter the market, particularly in a housing environment that continues to challenge affordability.

“We’re determined to make it easier for young people and first home buyers to achieve the dream of owning a home,” O’Neil said.

“We know the housing market is tough, and we want Australians to know that Labor has got your back.”

The announcement builds on more than $800 million already committed to housing in the ACT since 2022, according to Finance Minister and ACT Senator Katy Gallagher, who said the latest funding would help ensure national housing programs are translating into real supply on the ground.

“We’re working closely with the ACT Government to unlock land and invest in the infrastructure needed to get these homes built sooner,” she said.

For the ACT Government, the agreement aligns with its broader target of delivering 30,000 new homes by 2030, with Chief Minister Andrew Barr pointing to the role of coordinated planning and infrastructure investment in accelerating delivery.

“Now, thanks to our agreement with the Albanese Government, this work is about to reach a new level,” Barr said.

The deal sits within the Federal Government’s broader $45 billion housing agenda, which includes initiatives such as the Housing Australia Future Fund, the Help to Buy shared equity scheme, and incentives aimed at increasing construction capacity and reducing barriers to development.

Canberra set for 4,900 new homes under Federal housing deal

Dwelling Market

<html><body>
EXPERT OBSERVER
The CoreLogic Stratified Hedonic Index highlights the performance of the housing market across three segments. These three segments are: the 25% of most affordable dwellings, the 50% of dwellings representing the middle market and the 25% of most expensive dwellings. The analysis within this report is measuring the six month annualised change in dwelling values.
Nationally, from the market peak to the end of May 2019, the most affordable quarter has seen values fall by -1.4%, the middle of the market has seen values fall -6.6% and the top quarter has fallen by -11.6%. The -1.4% fall across the lower quartile is the largest since Sep-18, the -6.6% fall across the middle of the marketis slightly down on the previous month while the -11.6% fall across the top quartile is the second consecutive month in which falls have slowed and the smallest annual decline since Dec-18.
<ul>
<li>
Combined capital cities </li>
</ul>
Low quartile values are -5.1% lower over the year, middle market values have fallen -8.3% and top quartile is -12.4% lower. The -5.1% fall is the largest since September 2008 and the -12.4% fall is the smallest since December 2018.
<ul>
<li>
Combined regional markets </li>
</ul>
Values across the most affordable quarter of properties are -1.2% lower compared to a -1.6% fall across the middle of the market and a 6.7% fall across the top quartile (the largest fall since January 2012).
<img class="align-center" src="https://www.corelogic.com.au/sites/default/files/inline-images/National20190617.PNG" alt="National20190617.PNG" width="713" height="237" data-entity-type="file" data-entity-uuid="0bfdb83b-f326-4cbf-b15b-6c64474a89cb" data-image-style="" data-responsive-image-style="wide" data-zoom-image-style="_as_uploaded" data-mfp-src="https://www.corelogic.com.au/sites/default/files/inline-images/National20190617.PNG">
 
<ul>
<li>
Sydney </li>
</ul>
The low quartile has recorded a value fall of -2.0% (smallest fall since Oct-18) compared to -11.9% across the middle of the market (smallest fall since Jan-19) and -12.5% across the top quartile (smallest fall since Nov-18).
<ul>
<li>
Regional NSW </li>
</ul>
Values across the most affordable quarter of properties are 0.6% lower (slowest growth since Nov-18), the middle of the market has recorded falls of -4.6% and the top quartile has recorded falls of -9.0%.
<img class="align-center" src="https://www.corelogic.com.au/sites/default/files/inline-images/NSW20190617.PNG" alt="NSW20190617.PNG" width="734" height="244" data-entity-type="file" data-entity-uuid="b39ee5af-7567-4a32-a842-77ce9fd854d0" data-image-style="" data-responsive-image-style="wide" data-zoom-image-style="_as_uploaded" data-mfp-src="https://www.corelogic.com.au/sites/default/files/inline-images/NSW20190617.PNG">
 
<ul>
<li>
Melbourne </li>
</ul>
The -13.8% fall across the most expensive quarter of dwellings is the smallest since Nov-18 while the middle of the market has seen values fall -10.1% (smallest fall since Jan-19) and the most affordable quarter has recorded a value fall of -0.9% (smallest fall since Dec-18).
<ul>
<li>Regional Vic </li>
</ul>
The most affordable quarter of properties have increased in value by 0.8% while the middle of the market has increased by 1.2% (slowest rate of growth since Sep-16) and the top quartile has fallen by -6.4% (the largest fall since Feb-12).
<img class="align-center" src="https://www.corelogic.com.au/sites/default/files/inline-images/VIC20190617.PNG" alt="VIC20190617.PNG" width="743" height="247" data-entity-type="file" data-entity-uuid="46974346-63a4-4781-aa20-b5807fc89b10" data-image-style="" data-responsive-image-style="wide" data-zoom-image-style="_as_uploaded" data-mfp-src="https://www.corelogic.com.au/sites/default/files/inline-images/VIC20190617.PNG">
 
<ul>
<li>
Brisbane </li>
</ul>
Values have fallen by -0.7% across the most affordable quarter of dwellings compared to a -3.3% fall across the middle of the market (largest fall since Feb-12) and a -6.2% fall across the most expensive quarter of properties (largest fall since Jan-12).
<ul>
<li>
Regional Qld </li>
</ul>
The most expensive quarter of dwellings fell -3.5% compared to a 0.7% fall across the middle of the market and a -0.3% fall across the most affordable quarter of the market.
<img class="align-center" src="https://www.corelogic.com.au/sites/default/files/inline-images/QLD.PNG" alt="QLD.PNG" width="763" height="251" data-entity-type="file" data-entity-uuid="699037bf-9816-488d-afb6-75030cf5eed7" data-image-style="" data-responsive-image-style="wide" data-zoom-image-style="_as_uploaded" data-mfp-src="https://www.corelogic.com.au/sites/default/files/inline-images/QLD.PNG">
 
<ul>
<li>
Adelaide </li>
</ul>
The most affordable quarter of dwellings have recorded growth of 0.9% (strongest growth since May-18) while the middle of the market has recorded a 0.3% increase and the top quarter of properties have recorded a fall of -2.7%, their largest fall since Jan-13.
<ul>
<li>
Regional SA </li>
</ul>
The most affordable quarter of properties have increased by 0.3% over the past year (the strongest growth since Aug-18) compared to a 3.7% increase across the middle of the market and a 0.6% increase across the most affordable quarter of properties.
<img class="align-center" src="https://www.corelogic.com.au/sites/default/files/inline-images/SA20190617.PNG" alt="SA20190617.PNG" width="718" height="239" data-entity-type="file" data-entity-uuid="3f9d5da2-f1aa-45c7-80e9-b777ec1635bd" data-image-style="" data-responsive-image-style="wide" data-zoom-image-style="_as_uploaded" data-mfp-src="https://www.corelogic.com.au/sites/default/files/inline-images/SA20190617.PNG">
 
<ul>
<li>
Perth </li>
</ul>
Values across the most affordable quarter of properties are -2.4% lower over the year compared to an -8.9% fall across the middle of the market and an -11.6% fall across the most expensive quarter of properties.
<ul>
<li>
Regional WA </li>
</ul>
The most affordable quarter of the market recorded a decline in values of -1.8% compared to -7.5% across the middle of the market and a -13.1% fall across the most expensive quarter, the largest fall since Jan-15.
<img class="align-center" src="https://www.corelogic.com.au/sites/default/files/inline-images/WA20190617.PNG" alt="WA20190617.PNG" width="737" height="245" data-entity-type="file" data-entity-uuid="476168d8-b9aa-4c98-be7a-b3bacd3e5834" data-image-style="" data-responsive-image-style="wide" data-zoom-image-style="_as_uploaded" data-mfp-src="https://www.corelogic.com.au/sites/default/files/inline-images/WA20190617.PNG">
 
<ul>
<li>
Hobart </li>
</ul>
The most affordable quarter of properties recorded a value increase of 4.6% over the year (the slowest rate of growth since Jun-16) compared to a 0.6% increase across the middle of the market (slowest growth since Jun-16) and a -0.5% fall across the most expensive properties (largest fall since Feb-15).
<ul>
<li>
Regional Tas </li>
</ul>
The most affordable quarter of properties recorded an 8.8% annual increase (strongest growth since Nov-18) while the middle of the market recorded growth of 3.8% and the most expensive quarter recorded 3.0% growth over the year.
<img class="align-center" src="https://www.corelogic.com.au/sites/default/files/inline-images/TAS20190617.PNG" alt="TAS20190617.PNG" width="781" height="260" data-entity-type="file" data-entity-uuid="991bb60c-c24a-4e5b-9a3e-9e22a1c2764d" data-image-style="" data-responsive-image-style="wide" data-zoom-image-style="_as_uploaded" data-mfp-src="https://www.corelogic.com.au/sites/default/files/inline-images/TAS20190617.PNG">
 
<ul>
<li>
Darwin </li>
</ul>
The most expensive quarter of properties across the city have fallen in value by -16.8% over the past year (largest fall since May-16) compared to a -17.0% fall across the middle of the market (largest fall on record) and a -14.6% fall across the most affordable quarter of the market (largest fall since Nov-18).
<ul>
<li>
Regional NT </li>
</ul>
The most affordable quarter of properties have recorded an increase of 11.3% over the past year, their largest increase since Apr-17 while the middle of the market has seen values rise 1.9% and the most expensive quarter of properties have fallen by -0.2%.
<img class="align-center" src="https://www.corelogic.com.au/sites/default/files/inline-images/NT20190617.PNG" alt="NT20190617.PNG" width="786" height="261" data-entity-type="file" data-entity-uuid="69900538-8b47-43d2-82e5-390f94ceacb6" data-image-style="" data-responsive-image-style="wide" data-zoom-image-style="_as_uploaded" data-mfp-src="https://www.corelogic.com.au/sites/default/files/inline-images/NT20190617.PNG">
 
<ul>
<li>
Canberra </li>
</ul>
The most expensive quarter of properties have recorded no change in value over the past year while the middle of the market has recorded growth of 0.7% (slowest growth since Aug-16) and the most affordable quarter has recorded value growth of 1.3% (slowest growth since Jun-16).
<img class="align-center" src="https://www.corelogic.com.au/sites/default/files/inline-images/Canberra20190617.PNG" alt="Canberra20190617.PNG" width="750" height="256" data-entity-type="file" data-entity-uuid="11bca82d-0807-4bca-bb2e-38b729584b6e" data-image-style="" data-responsive-image-style="wide" data-zoom-image-style="_as_uploaded" data-mfp-src="https://www.corelogic.com.au/sites/default/files/inline-images/Canberra20190617.PNG">
 
Over the past year, most capital cities and regional markets have been recording value declines. While values are broadly continuing to fall, the rate of these falls on a monthly basis has been slowing. After having seen much larger corrections than the other two segments (following a larger growth phase), the most expensive segment of the market is seeing its rate of decline slow.
This is a trend that has played out before whereby premium housing values fall the fastest initially but also sees the falls cease earlier than other market segments. It is still early days but with the housing market expected to trough in late 2019, the premium housing sector may find a floor first and start to show some level of recovery before the other segments.
CAMERON KUSHER is the head of research for the Australian branch of CoreLogic
Kusher regularly posts on the <a href="https://www.corelogic.com.au/news" target="_blank">CoreLogic website</a>.
</body></html>

ckusher-ujnxiKuFQs

Value declines on most expensive properties are slowing: Cameron Kusher

<html><body>
GUEST OBSERVER
The ABS quarterly survey “Building Activity” provides detail on the non-residential building sector. Here we reassess conditions and prospects for the sector.
Hereafter ‘building’ refers to ‘non-residential building’.
<a href="/images/2016/10/31/Screen%20Shot%202016-10-31%20at%201.52.08%20PM.png" target="_blank">Click to enlarge</a> <img src="/images/2016/10/31/Screen%20Shot%202016-10-31%20at%201.52.08%20PM.png" alt="">
In summary, private building activity weakened over the first half of 2016, puncturing a five year upswing. Our assessment remains that the near-term decline in private activity will be relatively modest, a view supported by the recent improvement in approvals and commencements.
By contrast, total building activity (which includes public works) is likely to be resilient. Notably, the public sector has loosened the purse strings, committing to much needed social infrastructure. Public building approvals and commencements have lifted sharply from their lows.
<a href="/images/2016/10/31/Screen%20Shot%202016-10-31%20at%201.54.02%20PM.png" target="_blank">Click to enlarge</a>
<img src="/images/2016/10/31/Screen%20Shot%202016-10-31%20at%201.54.02%20PM.png" alt="">
State by state, conditions are varied and more nuanced than a mining / non-mining divide, as discussed below.
Activity: Real private building activity has weakened in 2016, falling by 4.2% in Q1, followed by a flat Q2. That follows a 31% expansion in the five years to end 2015, including a 7.8% increase in 2015. The level of activity in the Q4 2015 was 4.6% above the previous peak of end 2008, ahead of the GFC impacts.
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Public works in 2016 are in the beginnings of an upswing. Activity rebounded by 6.1% in Q1 and rose a further 11.9% in Q2. Prior to this, activity declined through 2011 to 2015, unwinding the 2009 fiscal stimulus package.
Total real building work was flat over the first half of 2016, with a 2.2% fall in March reversed by a 2.4% June, to be broadly unchanged from a year ago (+0.6%).
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Total commencements strengthened in 2015/16, increasing by 14% to $33.6bn, a rise of $4.1bn, largely reversing the 16% decline in 2014/15. In the June quarter, commencements were $8.5bn, in line with the annual pace.
The public sector led the way in 2015/16, with commencements up 41% to $8.8bn, (+$2.6bn), with rebounds in health, education and strength in social buildings more generally. This has public commencements at their highest level since 2011/12.
Private commencements also rose in 2015/16, +7%, following a 16% fall the year prior, centred on: retail; entertainment &amp;recreation; and accommodation.
The pipeline of work outstanding peaked at a relatively high level in mid-2014, at $27bn in total ($21bn for the private sector). The pipeline was progressively reduced, moderating to $19bn by the end of 2015 ($14bn private). Over the past half year, the overall pipeline of work stabilised, edging up to $20bn, while that for private projects edged lower, down to $13bn. 
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Commencements and approvals 
Private sector commencements were valued at $24.9bn in 2015/16, an increase of 7% on the year prior, +$1.6bn, partially reversing the 16% decline in 2014/15. The rebound was centred on: retail, +$0.9bn; entertainment &amp; recreation, +$0.7bn; and accommodation, $0.6bn.
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Private commercial building commencements (centred on retail and offices) have improved following a sharp fall in 2014/15. In 2015/16, commencements for the segment were valued at $11.0bn, +10% on the year before. That is below the 2013/14 outcome of $13.0bn and the earlier peak of $15.7bn in 2007/08. 
For retail, while consumer spending has been lacklustre at the national level, commencements are elevated supported by increased competition. In the office segment, commencements have stabilised at a low level, +6% in 2015/16, after falling sharply in 2014/15, down 39%. The outlook for offices is heavily influenced by the mining / non-mining growth divide.
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An area of strength is ‘social infrastructure’. Within this segment upswings are evident in accommodation (including hotels and student apartments) and aged care facilities, as well as strength in entertainment &amp; recreation, and a rebound in education. In 2015/16, commencements for social infrastructure rebounded by 9%, to $9.8bn, only 5% below the historic high of 2013/14 and up from $5.8bn in 2007/08. The segment now accounts for 40% of total private commencements. 
The more timely building approvals data, which is available to August, confirm that we are likely past the low point in this cycle. 
Private building approvals for the 12 months to August are 3% above those for the year before, reflecting gains in social infrastructure, +8%, and industrial, +17%. However, private building approvals remain 10% below the recent peak, which was for the year to February 2014.
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State-by-state 
Building conditions across the states are quite varied and the outlook is more divergent than is implied by a simple mining / non-mining growth divide. 
As at the national level, the importance of social infrastructure projects, a lift in public investment, and resilience in the retail sector add nuances to the state-by-state picture.
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The value of building work nationally grew by 2.3% over the year to the June quarter 2016, +$0.2bn (although in real terms, work was broadly flat, up 0.6%). By state, the value of building work made solid gains in NSW and Qld, as well as Tasmania, with largely offsetting falls in Victoria, WA and South Australia. 
Commencements strengthened in 2015/16, up $4.2bn nationally, a move that was centred on gains in Qld , as well as a strengthening of public works in the smaller states.
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In Qld, commencements rebounded partially in 2015/16, up $1.9bn, following a sharp fall in 2014/15. It was private social infrastructure, as well as public works, that led Qld commencements higher in 2015/16, including: accommodation, aged care facilities, education, and entertainment &amp; recreation. 
Public building commencements in the smaller states and in the territories jumped to $2.7bn in 2015/16, up $1.6bn on 2014/15. A partial rebound in NSW public commencements, +$0.7bn, was another mover in 2015/16. 
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On a state by state basis, current conditions and the near-term building outlook are, in summary: 
In NSW: real building work grew by 7% over the past year. This lift in activity was supported by reducing what was a sizeable pipeline of work outstanding. Near-term, the value of activity is vulnerable to a pull-back from current elevated levels, which are around 20% above commencements. Beyond that, the outlook is positive, reflecting the sound fundamentals for the state and expansionary state fiscal policy. 
In Victoria: real building work declined by 6% over the past year, partially reversing the upswing of the previous couple of years. An emerging stabilisation in activity is likely in coming quarters, ahead of an improvement, supported by the recent strengthening of commencements and approvals, and underpinned by positive fundamentals. 
In Qld: real building work rebounded over the past year, up 12%, following the softer tone evident since 2011 which was associated with the winding down of the mining investment boom. As noted above, commencements bounced back in 2015/16, up on private social infrastructure and public works. The modest lift in the work pipeline will be supportive of activity near-term. Further out, key will be whether some sizeable tourism projects receive the go ahead in response to rising demand, including from international visitors. 
In WA: real building work trended lower over the past year, down 7%, extending the downturn which emerged from the start of 2012 associated with the turning of the mining investment cycle. Conditions are likely to remain subdued as the state continues to feel the impacts from the mining investment downturn, notwithstanding stronger commencements in the June quarter, centred on retail.
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In South Australia: building work weakened over the past two years, including a 9% fall in the year to June 2016, as work on the Royal Adelaide Hospital was progressively completed. Conditions are set to turnaround in coming quarters, led by the public sector, with work progressing on the $0.23bn University of South Australia’s Health Innovation centre and the $0.2bn Adelaide University Medical and Nursing school. 
In Tasmania: building work has begun to recover, led by the public sector. This follows four years of subdued conditions which emerged after the impacts of the Federal government’s fiscal stimulus package of 2009/10. The value of building work for the 2015/16 financial year as a whole was 14% above the level of the year prior. There is further upside, supported by the now relatively sizeable work pipeline, which stands at $0.68bn currently, up from around $0.25bn a year earlier. The $0.7bn Royal Hobart hospital redevelopment is the largest project under construction and work on this has a good deal to run. 
Andrew Hanlan is senior economist for Westpac and can be contacted <a href="https://www.propertyobserver.com.au/https://au.linkedin.com/pub/andrew-hanlan/3/222/430" target="_blank">here</a>. 
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jchancellor-FAypfDUnLy

Private building activity weakened over first half of 2016: Westpac's Andrew Hanlan

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Capital city transaction levels have continued to trend lower according to CoreLogic's latest Economic and Housing update.
According to CoreLogic the slide began after 2013 from a peak of around 35,000 sales and continues downward.
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