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

Joel Robinson

Parcel delivery is joining the apartment amenity checklist

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

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

Seasoned Victorian apartment developer <a href="https://www.apartments.com.au/developers/central-equity">Central Equity</a> has logged more than $400 million in sales in its luxury apartment project Palmera Residences at Northcliffe on the Gold Coast.&nbsp;

Central Equity Director Karl Kutner said the sales result reflected a combination of location, product quality and delivery certainty with the project already under construction by building powerhouse Multiplex.&nbsp;

"Surpassing $400 million in sales since launch is a significant milestone and an outstanding endorsement of <a href="https://www.apartments.com.au/new-apartments/palmera-residences-gold-coast-18-garfield-terrace-surfers-paradise-qld-4217">Palmera Residences</a>,” he said.&nbsp;

"We believe one of the key reasons for this strong result is the confidence purchasers have in knowing the project is under construction with Multiplex. Buyers are increasingly looking for certainty. They want to know that the project they commit to today will be delivered by an experienced team with a proven track record."&nbsp;

[smartcode_project:default project_id=108274 project_image_fid=365782]

Kutner said it was clear there was still high demand for luxury projects that offered certainty of delivery.&nbsp;

“We are in a market where many residential developments have faced delays due to rising construction costs, labour shortages and financing challenges,” said Kutner.&nbsp;

"But having construction underway has provided our buyers with resounding confidence backed by more than 40 years of development delivery by Central Equity combined with construction by one of Australia's most respected construction companies."&nbsp;

[smartcode_project:default project_id=108274 project_image_fid=365785]

Central Equity is one of Australia's most experienced privately-owned property developers. Over more than four decades, the company has delivered in excess of 85 residential developments including 10,000 apartments and many thousands of stand alone homes.&nbsp;

Located on Garfield Terrace at Northcliffe, between Surfers Paradise and Broadbeach, Palmera Residences occupies one of the Gold Coast's most sought after beachside locations. The development has been designed to appeal to owner occupiers seeking premium residences that combine generous living spaces and resort style amenities.&nbsp;

Palmera Residences will feature an exceptional collection of resort style amenities, including two swimming pools: a generously sized family pool with safe shallow zones for relaxed recreation, and a 20 metre lap pool positioned to maximise all day sunlight.&nbsp;

Residents will also enjoy exclusive access to wellness and recreational facilities including a magnesium pool, sauna, yoga studio, expansive fitted gymnasium, resident lounge, outdoor BBQ’s&nbsp;and indoor and outdoor dining areas, together with a dedicated concierge and luxurious hotel inspired entrance foyer.&nbsp;

[smartcode_project:default project_id=108274 project_image_fid=365767]

A unique feature at Palmera Residences has been designed to enhance the Gold Coast lifestyle which includes both indoor and outdoor gymnasium facilities, together with thoughtfully designed indoor and outdoor dining and entertaining areas. A corner café has also been incorporated to provide residents with a destination for their everyday needs.&nbsp;

Kutner said buyer demand had been broad based with purchasers attracted from interstate as well as throughout South East Queensland.&nbsp;

"We're seeing strong interest from owner occupiers, lifestyle buyers and people relocating to the Gold Coast. Many purchasers have been searching for a premium beachside residence where quality, design and delivery are equally important."&nbsp;

[smartcode_project:default project_id=108274 project_image_fid=365771]

Kutner said the sales milestone was an important achievement, but the focus remained firmly on delivering an exceptional development.&nbsp;

"While reaching $400 million in sales is an important milestone, our priority remains delivering a project that exceeds purchaser expectations,” he said.&nbsp;

"Palmera Residences has been designed to become one of the Gold Coast's landmark residential addresses, and we look forward to welcoming our purchasers to their new homes."&nbsp;

There are a limited number of residences remaining in selected configurations with pricing from $2,950,000 to $8,950,000. Palmera Residences is also crowned by expansive penthouses with wrap around views.

[smartcode_project_cta:default project_id=108274]

Construction certainty and strong buyer demand drive major sales result for luxury Gold Coast development

Palmera Residences fly out the door as sales pass $400 million

National property developer <a href="https://www.apartments.com.au/developers/goldfields-group">Goldfields</a> has appointed BINAH as its construction partner for Quartet, its new Brisbane apartment development in the undersupplied suburb of <a href="https://www.apartments.com.au/developments/milton-qld-4064">Milton</a>.

Located just two kilometres from the Brisbane CBD and moments from key 2032 Olympic precincts, <a href="https://www.apartments.com.au/new-apartments/quartet-milton-33-manning-street-milton-qld-4064">Quartet</a> will deliver 131 one, two, three, and four-bedroom apartments priced from $1 million to $4.2 million, combining elevated design with a wellness-focused lifestyle offering.&nbsp;

[smartcode_project:default project_id=108736 project_image_fid=368000]

Goldfields’ Chief Executive Officer, Lachlan Thompson, said the appointment of <a href="https://www.apartments.com.au/builders/binah-constructions">BINAH</a> marked an important milestone for the project.&nbsp;

“Bringing BINAH on board as our construction partner will allow us to bring our vision for Quartet forward with a team that has a proven track record of delivering high-quality residential projects,” Thompson said.&nbsp;

“We’ve taken a considered approach to progressing the site because we wanted to deliver the whole package. Buyers ultimately back great developers, great projects and great builders, and with Quartet, we’ve made sure all three line up.

“People want certainty, they want to know the project will be built, that the homes will be delivered as promised, and that the developer stands behind the quality of what they create. That’s something Goldfields has built its reputation on over many years.”&nbsp;

[smartcode_project:default project_id=108736 project_image_fid=367993]

BINAH’s Managing Director, Khalil Hafza, said the company was proud to be partnering with Goldfields to deliver Quartet.&nbsp;

“Quartet is an exciting project to bring to life, particularly given the level of detail in the residences and the extensive rooftop amenity planned for the building,” Mr Hafza said.&nbsp;

“Our focus is on delivering a high-quality build that brings that design vision to life and creates homes residents will enjoy for many years.”&nbsp;

[smartcode_project:default project_id=108736 project_image_fid=367999]

The facilities at Quartet have been feared towards the roof, with a&nbsp;25 metre lap pool, spa, sauna and cold plunge, and a communal barbecue area and alfresco.

Town planning was designed by <a href="https://www.apartments.com.au/architects/rothelowman">Rothelowman</a> and brought to life by Melbourne-based architecture firm Cera Stribley.

<a href="https://www.apartments.com.au/interior-designers/cera-stribley">Cera Stribley</a> Co-Founder and Managing Principal, Dom Cerantonio, said the project responds to both its riverside setting and Brisbane’s evolving urban character.&nbsp;

“Quartet has been designed to sit comfortably within its riverside context, offering a refined take on urban living through well-planned, generously proportioned residences that will stand the test of time,” Mr Cerantonio said.&nbsp;

“An emphasis on natural light, natural textures and carefully selected finishes from timber and marble to premium appliances, creates calm, considered interiors designed for comfort and long-term liveability.”&nbsp;

Construction of Quartet will commence in July 2026, with completion anticipated in Q4 2028.

[smartcode_project_cta:default project_id=108736]

Construction to commence on 131-residence tower designed around wellness-focused living

Goldfields appoints BINAH for Quartet apartments in Milton

The first partnership between national developer <a href="https://www.apartments.com.au/developers/fortis">Fortis</a> and Adelaide-based developer <a href="https://www.apartments.com.au/developers/otello">Otello</a> has made a strong start, with the pair securing $21 million in unconditional sales at <a href="https://www.apartments.com.au/new-apartments/one-four-four-hutt-adelaide-144-hutt-street-adelaide-sa-5000">One Four Four Hutt</a>&nbsp;on the edge of the Adelaide CBD.

Over a third of apartments have been snapped up in the boutique 44-apartment project on the corner of Hutt Stret and Wakefield Road. Local downsizers and owner-occupiers wanting to remain in Adelaide's tightly-held southeast quarter have been the most prominent purchasers.

The DKO-designed, mixed-use development is one of the few new apartment projects in the precinct, an area where new housing supply has remained limited despite continued demand from buyers wanting to stay close to the CBD, Victoria Park and Adelaide's established east-end amenities.

[smartcode_project:default project_id=151233 project_image_fid=375378]

Fortis Head of Development SA Arthur Dendrinos said the early sales reflected both the strength of the local owner-occupier market and confidence in the Hutt Street location.

"The level of early commitment reflects the confidence local buyers have in the Hutt Street precinct," Dendrinos said.

"Many purchasers are long-term east-end residents who love the area and want to stay connected to the neighbourhood. They recognise the value of a well-designed, well-located development.

"Our partnership with Otello has been central to this success, and the number of unconditional sales at this stage only strengthens our confidence in the South Australian market."

[smartcode_project:default project_id=151233 project_image_fid=375379]

Otello Director Daniel Harris said the sales result also highlighted the lack of new apartment opportunities within the Hutt Street precinct.

"One Four Four Hutt has clearly resonated with buyers, with strong early sales reflecting both the appeal of the Hutt Street corridor and the lifestyle on offer," Harris said.

"The activated ground-floor retail has also been a key drawcard, with purchasers responding to the vision of a more vibrant and connected streetscape, not just the residences themselves."

One Four Four Hutt will deliver 44 one, two and three-bedroom apartments, alongside a collection of penthouses, above a ground-floor retail offering designed to further activate the Hutt Street precinct.

Construction is scheduled to commence in the third quarter of this year, with completion anticipated in 2028.

[smartcode_project_cta:default project_id=151233]

Fortis Head of Development SA Arthur Dendrinos said the early sales reflected both the strength of the local owner-occupier market and confidence in the Hutt Street location.

Fortis makes Adelaide debut with Otello as One Four Four Hutt records strong early sales

Federal Election

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The Ray White chairman Brian White has called the bottom of the property market in the wake of the Coalition’s return to government.
Although the latest price data - for the first two thirds of May – shows a market still in decline albeit with a moderation in the pace of price.
Labor’s planned wind back of the negative gearing and capital gains tax discounts along with opposition Treasury spokesman Chris Bowen’s dismissal of people’s concerns over the risk of negative ­equity in their homes had “ricocheted through the whole community”, Mr White told The Australian.
Brian White noted the market had worries over Labor’s policies and there had been uncertainty surrounding the election which had been a drag on confidence.
Prices in both Sydney and Melbourne have fallen more than 10 per cent over the past year, with values dropping 7.2 per cent on a national basis, according to CoreLogic.
Not all commentators expect an end to the downturn.
In an article by the AFR, Aussie Home loan founder John Symonds said the “confidence” levels would now steady instead of worsen.   Symonds there would be "a boost for confidence."
"The property market will settle down again now. It is going back to health,” he said.
AMP Capital's Shane Oliver saying "the removal of the threat to negative gearing and the capital gains tax discount and a slowing in new supply next year will help the property market bottom out short of the worst case falls some are putting out there."
Goldman Sachs economists are forecasting a "moderate positive shock to sentiment in the corporate sector and a more meaningful one in the housing sector".
<a href="/news/rea-group-sees-listings-decline-especially-in-sydney-and-melbourne">The REA Group warned earlier this month</a> that the market conditions are "not expected to improve in the short term", noting slowing listing volumes given the distractions of the federal election as well as the Easter and Anzac Day long weekends in April.
The post election analysis comes after all the April and May marketing interruptions which saw Ray White offices <a href="/news/ray-white-sees-14-year-on-year-sales-tally-decline-in-april-2019">record a 14% drop in sales on April 2018</a>, the Ray White board director Dan White noted last week.
"Looking back on April, it was a tough month and we are actually glad it’s now behind us given all the public holidays, school holidays and the federal election campaign getting underway," White said.
Brian White affirmed that lifting restrictions on credit would be key to any recovery in the markets.
“Banking policy will be critical,” Mr White said.
“A cut from the RBA will be useful but this is one downturn where interest rates had no impact.”
He said the Reserve Bank’s fear of a further declining housing market would be eased with the risks of Labor’s policy removed.
According to Ray White Surfers Paradise Group CEO Andrew Bell, now that the election is over, "one of the major impediments on the real estate market has been removed and we have greater clarity and certainty about the lay of the land."
“There’s been a lot of negativity around this election which has impacted consumer confidence, and this comes on top of a challenging year that has been impacted by tighter lending conditions that have put the brakes on buyer activity.
“There were massive fears about the effects of the proposed changes to negative gearing proposed by Labor,” said Mr Bell.
“That would have put the real estate market in uncharted waters and would have undeniably had major effects, particularly in established neighbourhoods that predominately have second-hand properties.”
Bell suggested Labor’s policy on negative gearing on new properties was likely to have channelled more capital into new developments. 
“There’s no question it would have been a boost to the volume of buyers of new projects, but so many of these are not in areas where tenants are seeking rental accommodation.
“It would have led to values in some suburbs being boosted artificially through added demand, while other suburbs would have suffered huge declines in the volume of buyers. It would have been simply unfair on existing house-owners in those suburbs.”
</body></html>

j.ballantyne1990-6AQqhLzZaK

Ray White boss Brian White thinks Coalition return will trigger end of real estate downturn

<html><body>
EXPERT OBSERVER
<a href="http://theconversation.com/institutions/crawford-school-of-public-policy-australian-national-university-3292"></a>
Albo, or Plibersek, or whoever it turns out to be the next Labor leader, might have had a lucky accident. Usually, it’s Labor that inherits an economy turning down.
This time, it’s the Coalition. And because of regular updates from the Reserve Bank and the Bureau of Statistics strikingly at odds with their public position that the economy strong, they ought to be finely attuned to it.
Economic growth, the catch-all that is supposed to show us where the economy has been and where it is headed, is frighteningly small.
The treasury’s best estimate of potential growth – how strongly the economy could be growing over time if things were well managed – is <a href="https://www.smh.com.au/business/the-economy/myefo-treasury-downgrades-its-budget-projections-20151124-gl6mfd" target="_blank">2.75% per year</a>.
The reality, for the two most recent quarters for which we have data, is <a href="https://www.propertyobserver.com.au/http://www.abs.gov.au/ausstats/abs@.nsf/mf/5206.0" target="_blank">0.3% and 0.2%</a>.
<h2>The economy is anaemic, despite the crowing</h2>
If you add those two numbers together and multiply by two you discover that for six months the economy has been growing at an annualised pace of just 1% – way, way short of its potential.
Stripping out population growth and minimal price growth, real living standards have been going backwards.
The result of what the Reserve Bank describes as “<a href="https://www.rba.gov.au/publications/smp/2019/may/pdf/domestic-economic-conditions.pdf" target="_blank">persistently slow growth in household incomes and declining housing prices</a>” has been something of a strike in consumer spending. The real value of spending per household hasn’t been falling, but it hasn’t really been climbing either.
The bank says consumption growth has slowed most noticeably for discretionary items that tend to have the strongest relationship with home buying, such as furnishing and household equipment. It says growth in other types of discretionary spending, such as eating out, has also slowed. Consumption of so-called “essential” items is holding up.
<h2>We’re going to need a boost</h2>
It means we can’t rely on household spending to revitalise the economy (although the government will give it a go, stumping up a bonus of <a href="https://theconversation.com/its-the-budget-cash-splash-that-reaches-back-in-time-114188" target="_blank">as much as $1,080</a> to be delivered with each tax return from July in a much-needed boost that will be disguised as a <a href="https://theconversation.com/election-tip-23-9-is-a-meaningless-figure-ignore-the-tax-to-gdp-ratio-115432" target="_blank">tax cut rather than spending</a>).
Household spending accounts for three-fifths of gross domestic product. The bank identifies uncertainty over household spending, which itself derives from uncertainty over income growth, as a “<a href="https://www.rba.gov.au/publications/smp/2019/may/pdf/economic-outlook.pdf" target="_blank">key risk</a>” for economic growth:
<blockquote>
Should households conclude that low income growth will be more persistent than previously expected, households may adjust their spending by more than currently projected and consumption growth could remain weak for a longer period
</blockquote>
Labor would have helped stabilise uncertainty over income growth by immediately intervening before the Fair Work Commission to get higher wages, directing it to draw up a long-term strategy for higher wages, restoring cut penalty rates, and funding the increases of some childcare workers itself.Having won an election opposing those things, the Coalition will have to try other things, perhaps even bigger and earlier tax cuts.
Prayer would help – prayer that international commodity markets remain strong, that the Reserve Bank cuts rates on June 4 (it is practically certain to), that it cuts them again before the end of the year (financial markets are literally 100% certain that it will) and that home prices stabilise.
<h2>Perhaps a very big boost</h2>
On the face of it, none of these would be enough to force economic growth back up. If it falls even further, and continues to fall, Australia will enter a recession within this term of government, an outcome to which the academic economists polled by The Conversation in January <a href="https://theconversation.com/no-surplus-no-share-market-growth-no-lift-in-wage-growth-economic-survey-points-to-bleaker-times-post-election-110315" target="_blank">assigned a 25% probability</a>.
So far employment growth has been the economy’s brightest light, but in its quarterly update released a week before the election, the Reserve Bank pointed out that employment growth can lag economic growth by <a href="https://www.rba.gov.au/publications/smp/2019/may/pdf/domestic-economic-conditions.pdf" target="_blank">up to nine months</a>, meaning it might be about to turn down, although it added that it was not unusual for “trends in GDP growth and the labour market to diverge for sustained periods”.
If employment growth does turn down (and the bank says “near-term leading indicators of labour demand have softened”) it is likely to happen first in the construction and retail industries. The construction jobs will come again (and the government is doing its best to bolster them with promises of spending on infrastructure) but the retail jobs might never return, the nature of retailing having changed.
<h2>The economy matters more than the surplus</h2>
If needed in order to avoid a recession the government will have to be prepared to abandon its promised 2019-20 budget surplus. If the prospect of a recession does loom, it’ll have the political cover. And if it looms early in its term, it might still be able to deliver a budget surplus by the end.
Scott Morrison and his treasurer Josh Frydenberg were elected to manage the economy, and that means doing whatever is needed to avoid a recession and the long term damage to lives and living standards it would deliver.
Speaking personally, I’ve no doubt they are up to the task, just as Labor would have been. In a way it’s a pity they didn’t adopt one of Labor’s key economic promises, which was to have a new budget in August, to refresh things.
<h2>And it matters more than superannuation</h2>
And they’ve got to focus on lifting living standards over the longer-term, where conveniently, they have a big advantage over Labor.
Labor has a blindspot when it comes to superannuation. It wants to lift compulsory contributions from 9.5% of salary to 10% on July 2021, and then by another 0.5% the next year and another 0.5% the next year and so on for five consecutive years, apparently regardless of what it will do to incomes now.
It’s a good thing that unlike Labor, the Coalition will be relaxed about pushing out the timetable if the economy can’t stand it, as it has done before.
Before the election it was preparing to respond to the landmark <a href="https://theconversation.com/frydenberg-should-call-a-no-holds-barred-inquiry-into-superannuation-now-because-labor-wont-114079" target="_blank">Productivity Commisson report</a> that found that unintended multiple accounts and the defaulting of new workers into entrenched underperforming funds were costing members an extraordinary A$3.8 billion per year.
<h2>The Coalition can set up super for the future</h2>
Weeding out the chronic underperformers, clamping down on unwanted multiple accounts and insurance policies, and letting workers choose funds from a short menu of good funds and stay in them for life would give the typical worker entering the workforce an extra $533,000 in retirement.
It recommended a full-blown independent inquiry into <a href="https://theconversation.com/frydenberg-should-call-a-no-holds-barred-inquiry-into-superannuation-now-because-labor-wont-114079" target="_blank">how much superannuation we need</a>.
Labor, wedded to a series of increases, would never have done it. The Coalition can.
<a href="https://theconversation.com/profiles/peter-martin-682709" target="_blank">Peter Martin</a>, Visiting Fellow, <a href="http://theconversation.com/institutions/crawford-school-of-public-policy-australian-national-university-3292" target="_blank">Crawford School of Public Policy, Australian National University</a>
This article is republished from <a href="http://theconversation.com" target="_blank">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/their-biggest-challenge-avoiding-a-recession-117381" target="_blank">original article</a>.
</body></html>

Frydenberg and Morrison's biggest challenge? Avoiding a recession: Peter Martin

<html><body>
Some economists expect a rebound in Australia's declining property markets after Labor's failed to win the election and get the chance to implement controversial changes to negative gearing and capital gains tax.
Goldman Sachs economists even forecast a "meaningful positive shock in the housing sector".
<div>
Election day predictably saw further subdued auction numbers across already quiet autumn auction markets.
But weekend clearance rates remained solid.
With the quieter winter selling hibernation now approaching fast, hopes for a market revival, likely rest on a spring bounce.
<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/2019/5/20/May20.jpg" alt="">
It was a close call between the top sales across the two big auction capitals.
Sydney secured a $4.65 million sale in Bronte, while the top sale in Melbourne was $4.6 million in Camberwell.
The Bronte sale was a five bedroom house <a id="LPlnk203061" href="https://www.propertyobserver.com.au/https://www.mcgrath.com.au/buy/house/nsw/eastern-suburbs/bronte/400903" target="_blank" rel="noopener noreferrer" data-auth="NotApplicable">14 Blandford Avenue</a> (below) which sold through McGrath agent Chris Volpatti who had a $4.3 million price guide.
<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/2019/5/20/Bronte1.jpg" alt="">
It was a modernised home behind its two storey art deco facade.
It had last sold at $1.78 million in 2012 before its extension.
Three of the four bidders were local families looking to upsize.
The Camberwell sale came after the property at <a id="LPlnk768860" href="https://kayburton.com.au/real-estate/house-61-prospect-hill-road-camberwell-vic-3124-1118302" target="_blank" rel="noopener noreferrer" data-auth="NotApplicable">61 Prospect Hill Road </a>(top) was passed in with just one bidder at $4.55 million.
The top bidder was assisted by the agencies' China desk, represented by Isabella Lu, an international client relationship manager.
Set on the corner of Kingsley Street, the 1886 Victorian residence sits on 1672sqm without pool.
Listed with $5 million hopes, it had last traded in 1949.
Concerned neighbours handed out a flier to the onsite auction attendees saying "local residents will strongly resist any plans to demolish the house, or any development plans that are not appropriate."
In Melbourne there was a preliminary auction clearance rate of 62.9 per cent making it the best performing auction market with 427 auctions.
There were fewer homes taken to auction across the combined capital cities, as the nation stopped amidst the Federal election hype.
Of the 917 homes that did go to auction across Australian in the past week, the preliminary national result saw a 57 percent success rate..
The week prior saw 1,218 homes auctioned across Australia with the final 54 percent auction clearance rate the highest final result since September last year, according to CoreLogic.
Comparing results from the same week last year, 2,100 homes were taken to auction returning a 56.8 per cent final clearance rate.
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Sydney’s final clearance rate has come in at the high 50 per cent range for the last two weeks.
"The last time Sydney’s clearance rate was in the high 50’s was mid-May last year," CoreLogic auction analyst Kevin Brogan said.
There were 270 auctions this week held in Sydney, with just under 200 on Saturday, returning a preliminary clearance rate of 60.7 per cent.
Last week, a higher 445 homes were taken to auction returning a 59 per cent final Sydney auction clearance rate.
There are more than 550 scheduled for next Saturday, and 490 currently scheduled for the first auction day of winter, according to Domain.
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Looking at the smaller auction markets, Canberra came in with the strongest preliminary result with 56 per cent of homes selling at auction this week, while only 25 per cent of homes in Perth sold.
Canberra's top sale was $1.02 million when the four bedroom house at <a id="LPlnk433386" href="https://www.propertyobserver.com.au/https://raywhitecanberra.com.au/properties/residential-for-sale/act/cook-2614/house/2099782" target="_blank" rel="noopener noreferrer" data-auth="NotApplicable">9 Grylls Crescent, Cook</a> was sold through Ray White.
The three level home came with spacious gourmet kitchen with Corian and stainless steel bench tops and quality Miele appliances.
Canberra's cheapest was $550,000 when the three bedroom at <a href="https://www.luton.com.au/7356492/37-livingston-avenue-kambah" target="_blank">37 Livingston Avenue, Kambah</a> was sold.
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It last sold at $220,000 in 2002.
The 858 sqm holding was marketed as a RZ2 redevelopment block or first home.
Brisbane' had the cheapest sale across the nation, with <a id="LPlnk376948" href="https://pinnacle.harcourts.com.au/Property/788045/QAP34762/16-9-Houghton-Street" target="_blank" rel="noopener noreferrer" data-auth="NotApplicable">16/9 Houghton Street, Petrie</a> sold at $240,000 through Harcourts.
It was a 2017 built one bedroom apartment with 78 sqm space.
It had been on and off the market since 2017 when it was listed at $285,000 and a $275 a week rental.
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jchancellor-FAypfDUnLy

Subdued election weekend auction offerings see Bronte and Camberwell vie for top spot

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GUEST OBSERVATION
On housing, the contrast between the two major parties couldn’t be clearer.
The Coalition is still pretending that you can help first homebuyers without hurting anyone. Labor isn’t.
This matters, because Australian governments have been <a href="https://grattan.edu.au/wp-content/uploads/2018/03/901-Housing-affordability.pdf" target="_blank">pretending</a> for decades that there are easy and costless ways to make housing more affordable. And over that time the problems have become worse.
The Coalition’s First Home Loan Deposit Scheme is the <a href="https://www.liberal.org.au/latest-news/2019/05/12/helping-australians-buy-their-first-home" target="_blank">latest plan</a> that is supposed to arrest the decline in home ownership among younger Australians.
The Coalition’s First Home Deposit Scheme
Housing costs are a big problem for young people. Home ownership is <a href="https://theconversation.com/three-charts-on-poorer-australians-bearing-the-brunt-of-rising-housing-costs-87003" target="_blank">falling fast</a> in Australia, especially among the young and poor. Fewer than half of 25-34 year olds own their home today. Home ownership among the poorest 20% of that age group has fallen from 63% in 1981 to 23% today. At this rate <a href="https://theconversation.com/retiree-home-ownership-is-about-to-plummet-soon-little-more-than-half-will-own-where-they-live-115255" target="_blank">almost half of retirees</a> will be renters in 40 years time.
Saving a deposit is the <a href="https://insidestory.org.au/why-should-we-care-about-housing-affordability/" target="_blank">biggest hurdle</a>. In the early 1990s it took six years to save a 20% deposit on the average home. Today it takes 10 years. That’s bad news for younger Australians without access to the “<a href="https://www.smh.com.au/politics/federal/house-prices-even-the-head-of-the-treasury-is-becoming-a-mum-and-dad-bank-20161019-gs5ii5" target="_blank">Bank of Mum and Dad</a>”.
The Coalition’s new plan seeks to arrest the decline by lending would-be buyers up to 15% of the purchase price, provided they’ve saved at least 5% for themselves.
It would also mean that single first home buyers on less than $125,000 a year, or couples earning less than $200,000, could <a href="https://www.yourmortgage.com.au/calculators/mortgage_insurance/" target="_blank">save</a> $10,000 or more by not having to pay the <a href="https://www.anz.com.au/personal/home-loans/first-home-buyer/guide/key-things-you-need-to-know-about-lenders-mortgage-insurance/"></a><a href="https://www.moneysmart.gov.au/borrowing-and-credit/home-loans/fees" target="_blank">lenders mortgage insurance</a> that is normally required when a purchaser has a deposit of less than 20%. There would be a cap on the value of homes purchased through the scheme, still unannounced, which would vary by region.
The Coalition is budgeting just $500 million for the guarantees. Labor was quick to <a href="https://theconversation.com/view-from-the-hill-quick-on-the-draw-labor-matches-morrisons-first-home-owners-scheme-116969" target="_blank">match</a> the scheme, partly because it doesn’t cost very much (unless there are unexpected losses).
Most likely, the scheme won’t have much impact.
It would increase home ownership, but only a little. It might also push up prices – but by even less. Some people saving for their first home might buy earlier. Others just priced out of the market at the moment could afford to pay a little more for a house given that they would not have to pay lenders mortgage insurance.
Most of those taking up the scheme would probably have bought anyway. Those with access to the Bank of Mum and Dad already have already been able to use such a scheme. And the income thresholds are set too high, cutting off only the top 10-15% of income earners. The New Zealand <a href="https://www.govt.nz/browse/housing-and-property/buying-or-selling-a-home/buying-your-first-home/" target="_blank">scheme</a>, upon which the Coalition’s plan is based, cuts out at incomes of only $85,000 for singles or $130,000 for couples.
The biggest barrier for many first home owners isn’t the deposit. Their problem is <a href="https://www.afr.com/opinion/when-responsible-lending-becomes-a-credit-slowdown-20190130-h1ant1" target="_blank">qualifying</a> for a mortgage when banks assess their ability to repay the loan assuming an interest rate of 7%, much higher than the typical 4%.
The Coalition has capped uptake at 10,000 loans every year, or about one in every ten loans (based on loans last year to first homebuyers). Even if none of them would have bought a home without the scheme (most unlikely), home ownership would be only 1% higher in a decade’s time.
But a bigger scheme might well be worse. If it “succeeded” in rapidly expanding demand from first home buyers, it would push up prices for everyone, not least all the other first home buyers trying to get into the market. Instead of being ineffective, it’d become counterproductive.
And the bigger the scheme, the greater the risks of <a href="https://www.theage.com.au/business/banking-and-finance/home-loan-scheme-could-increase-negative-equity-risk-economists-say-20190512-p51mke" target="_blank">dodgy lending</a>, which could leave the government on the hook if buyers default.
The underlying problem with the Coalition’s latest plan – like the First Home Super Saver Scheme it introduced in 2017, or the Howard and Rudd Government’s first homeowners grants – is that it tries to fix the housing affordability problem by adding to demand for housing.
Because it costs the budget less, the new scheme is less bad than its predecessors. But it shares their critical flaw: it pretends we can make housing more affordable without hurting anyone.
Its political virtue might be that it sends a signal to first home buyers that government is on their side.
Yet the Coalition <a href="https://www.news.com.au/finance/economy/australian-economy/experts-warn-of-glaring-issues-with-new-first-home-buyers-scheme/news-story/79b2fb2992b074104a6defc43730659a" target="_blank">won’t pursue</a> the one thing happen that would actually help home buyers the most: letting housing prices fall.
Labor’s negative gearing plan
Labor’s plan to abolish negative gearing on existing homes and halve the capital gains tax discount creates losers.
Labor would prevent new investors in existing homes from writing off the losses from their property investments <a href="https://alp.org.au/policies/reforming-negative-gearing-and-capital-gains-tax-arrangements/" target="_blank">against the tax they pay on their wages</a>. And investors would pay tax on 75% of their gains, up from 50% now.
Its plan takes away tax breaks worth $1 billion to $2 billion a year in the short term, and <a href="https://www.alp.org.au/media/1878/2019_labor_fiscal_plan.pdf" target="_blank">more</a> in the long term.
Existing homeowners would lose a little: The Grattan Institute <a href="https://grattan.edu.au/wp-content/uploads/2018/03/901-Housing-affordability.pdf" target="_blank">estimates</a> that house prices would be 1% to 2% lower under the Labor plan. The <a href="https://www.propertyobserver.com.au/http://www.abc.net.au/news/2018-01-08/govt-negative-gearing-claims-contradicted-by-official-advice-foi/9309736" target="_blank">Commonwealth treasury</a> and <a href="https://theconversation.com/confirmation-from-nsw-treasury-labors-negative-gearing-policy-would-barely-move-house-prices-116736" target="_blank">NSW treasury</a> have reached similar conclusions.
Prospective investors who had planned to buy and negatively gear an existing house would miss out on a lot. Some might buy anyway, others wouldn’t. Despite the <a href="https://www.propertyobserver.com.au/https://www.abc.net.au/news/2018-11-16/fact-check-negative-gearing-under-80000/10387552" target="_blank">noise</a>, the bulk of these people would be among the <a href="https://www.smh.com.au/politics/federal/negative-gearing-changes-will-affect-us-all-mostly-for-the-better-20190208-p50wjn" target="_blank">top 10%</a> of income earners.
By reducing investor demand for existing houses, Labor’s policy could provide a genuine boost to “genuine” home ownership, by owner occupiers. Fewer investors would mean more first home buyers winning at auctions.
Recent <a href="https://insidestory.org.au/what-comes-after-the-housing-boom/">restrictions</a> on lending to investors imposed by the Australian Prudential Regulation Authority have already resulted in an <a href="https://www.abs.gov.au/AUSSTATS/abs@.nsf/DetailsPage/5601.0Feb%202019?OpenDocument" target="_blank">increase</a> in the share of lending to first homebuyers. Labor’s policies would accelerate it.
The bottom line on housing? Changing rules on negative gearing and capital gains tax is more likely to increase home ownership than guaranteeing part of the deposit.
But no policy proposed in this Commonwealth election affects the really big lever for home ownership: <a href="https://theconversation.com/to-make-housing-more-affordable-this-is-what-state-governments-need-to-do-105050" target="_blank">increasing housing supply</a>.
Brendan Coates, Fellow, Grattan Institute
John Daley, Chief Executive Officer, Grattan Institute
This article is republished from <a href="http://theconversation.com" target="_blank">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/the-brutal-truth-on-housing-someone-has-to-lose-in-order-for-first-homebuyers-to-win-117010" target="_blank">original article</a>.
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The brutal truth on housing: Someone has to lose in order for first home buyers to win

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GUEST OBSERVATION
No matter who wins Saturday’s federal election, you can expect to see more cranes on the skyline and hi-viz vests on the roadside.
Both major parties are promising to spend big on transport infrastructure: A$42 billion for the Coalition and A$49 billion for Labor.
However, many of the favoured projects are unlikely to be completed for years or even decades to come.
What’s being promised, and where?
The types of project each party is promising reflect a now-familiar pattern seen in the recent <a href="https://theconversation.com/how-much-will-voters-pay-for-an-early-christmas-eight-charts-that-explain-victorias-transport-election-106782" target="_blank">Victorian</a> and <a href="https://theconversation.com/how-the-nsw-election-promises-on-transport-add-up-112531" target="_blank">New South Wales</a> elections.
The Coalition will outspend Labor on roads; Labor will outspend the Coalition on public transport.
<a href="https://images.theconversation.com/files/274293/original/file-20190514-60554-if4z2a.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/274293/original/file-20190514-60554-if4z2a.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a>
Author provided
There’s also a story in the details of where the parties are promising to spend. In Victoria, where the Coalition suffered heavy losses in last October’s state election, <a href="https://www.theage.com.au/federal-election-2019/some-seats-are-better-than-others-coalition-sandbagging-key-electorates-with-taxpayer-funds-20190501-p51j6b" target="_blank">the federal Coalition has been busy “sandbagging”</a> key seats. Until last weekend, the Coalition had been promising much more than Labor.
Announcements on Sunday changed all that. While the Coalition <a href="https://www.theaustralian.com.au/nation/4bn-bid-to-unlock-road-link-box/news-story/1c4254f3a80bc85dc11e068b9bff62a9" target="_blank">upped its commitment to the East West Link to A$4 billion</a>, this was dwarfed by Labor’s <a href="https://www.propertyobserver.com.au/https://www.abc.net.au/news/2019-05-12/shorten-morrison-pledge-cash-for-melbourne-infrastructure/11105094" target="_blank">A$10 billion pledge for the Suburban Rail Loop</a>. Victoria now stands as the key battleground for transport promises.
Labor is also writing bigger cheques than the Coalition in Queensland, where it <a href="https://www.propertyobserver.com.au/https://www.abc.net.au/news/2019-04-12/federal-election-queensland-battleground/10975570" target="_blank">hopes to make big gains</a>.
<a href="https://images.theconversation.com/files/274294/original/file-20190514-60549-1rw76kx.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/274294/original/file-20190514-60549-1rw76kx.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a>
Author provided
There’s some agreement on the big stuff
Despite their different ideologies and at-risk electorates, there is still much common ground between the parties. Almost one in three of the projects and funding packages that have attracted promises of at least A$50 million are backed by both the Coalition and Labor. Each party has promised almost A$24 billion for these “bilateral” projects – that’s more than half of the Coalition’s total promised transport infrastructure spending and almost half of Labor’s.
The parties are more likely to agree on big projects than small. Bilateral commitments make up almost half of all promises worth at least A$500 million, but less than a third of those below that threshold. For the very largest projects, the level of agreement is somewhere in between – the Coalition and Labor agree on four of the 11 projects attracting commitments of more than A$1 billion.
<a href="https://images.theconversation.com/files/274295/original/file-20190514-60560-esgadm.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/274295/original/file-20190514-60560-esgadm.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a>
Author provided
But voters are forced to make risky choices, again
With so much cash on the table, will these vast riches be spent on the right things?
More money for roads and public transport probably sounds fine to most Australians, whether they’re navigating potholed rural roads, stuck behind trucks on regional highways, drumming the steering wheel in clogged city streets, or calling in late on delayed suburban trains.
But are the projects of national significance and therefore worthy of Commonwealth attention? And can they be relied on to return a benefit larger than their cost?
For too many projects, the answers are no and no. Infrastructure Australia (IA) publishes a <a href="https://www.infrastructureaustralia.gov.au/projects/infrastructure-priority-list.aspx" target="_blank">list of national priorities</a> and evaluates business cases for projects that are “<a href="https://www.infrastructureaustralia.gov.au/about/files/IA-Statement-of-Intent-2017-19.pdf" target="_blank">nationally significant or where Commonwealth funding of A$100 million or more is sought</a>”. Most of the commitments above A$100 million in this campaign do not have IA-approved business cases.
Some projects are under evaluation, such as a new bridge in Nowra on the NSW south coast, but the two parties should have waited for IA’s assessment before committing.
Worse still, many promised projects are not even on the national priority list.
<a href="https://images.theconversation.com/files/274296/original/file-20190514-60541-bw6rss.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/274296/original/file-20190514-60541-bw6rss.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a>
Author provided
For projects attracting commitments of less than A$100 million, most are best left to state governments. The Commonwealth should stick to projects that are important to more than one state or are particularly important to the national economy.
Fixing <a href="https://www.barossaherald.com.au/story/5990686/budget-48-million-roundabout-at-kroemers-crossing/" target="_blank">regional</a> and <a href="https://anthonyalbanese.com.au/media-release-labor-will-fix-one-of-adelaides-worst-intersections-saturday-9-march-2019" target="_blank">suburban intersections</a> is important, but it’s hardly of national significance. When federal parties get involved, it starts to smell like pork-barrelling.
Some promises are inexcusable
Throwing taxpayer money at boondoggles is poor governance. Far worse is flagrantly ignoring independent advice and burning cash on projects that we know don’t stack up. Before the 2016 federal election, Grattan Institute reported on the <a href="https://theconversation.com/election-2016-will-the-infrastructure-promises-meet-australias-needs-61140" target="_blank">outrageous Princes Highway duplication between Winchelsea and Colac</a> in Victoria’s Western District. The Coalition promised this project even though IA determined that it would return only eight cents of value for every dollar spent.
Three years on, lessons still need to be learnt. Labor has committed A$50 million this election to the <a href="https://www.macarthuradvertiser.com.au/story/6092086/labor-pledges-50-million-to-finish-maldon-dombarton-rail-link-project/" target="_blank">Maldon-Dombarton rail link</a> in NSW’s Illawarra region. This <a href="https://www.infrastructureaustralia.gov.au/projects/files/Maldon-to-Dombarton-summary.pdf" target="_blank">A$806 million project got the thumbs-down</a> in 2017 from IA, which stated that “the project would not justify its costs and would impose a net cost on the Australian economy”.
In exceptional cases, governments may want to fund projects with costs outweighing benefits on equity grounds, <a href="https://grattan.edu.au/wp-content/uploads/2019/04/916-Commonwealth-Orange-Book-2019.pdf#page=63" target="_blank">such as to provide a minimum level of service for rural communities</a>. It is hard to make that case for a commercial freight rail link.
Every dud project built cannibalises a worthy one. Our politicians should stop donning hardhats and promising infrastructure before they’ve done their homework.<img src="https://counter.theconversation.com/content/115138/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1">
Greg Moran, Senior Associate, Grattan Institute
James Ha, Graduate Associate, Grattan Institute
This article is republished from <a href="http://theconversation.com" target="_blank">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/transport-promises-for-election-2019-the-good-the-bad-and-the-downright-ugly-115138" target="_blank">original article</a>.
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Transport promises for election 2019: the good, the bad and the downright ugly

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The Prime Minister’s plan to help first-home buyers purchase with only a 5% deposit could have a major impact on the broader economy, says one property group. 
The First Home Loan Deposit Scheme, adopted from New Zealand’s Welcome Home Loan program and announced by the Prime Minister Scott Morrison at the Liberals’ formal campaign launch in Melbourne last week, will mean first-home buyers, who have been able to save a deposit of at least 5%, will be able to access a government guarantee for the remainder of up to 20% of a property’s value.
It will also remove the costs of paying lenders’ mortgage insurance.
The scheme will offer up to $500 million in equity through the National Housing Finance and Investment Corporation, would start on January 1, 2020, and be capped for individuals earning $125,000 and couples earning $200,000.
Labor has said it will match the Coalition plan, stating it could afford to do so as it was “closing loopholes” for the wealthy.
RiskWise Property Research CEO Doron Peleg said the Coalition’s First Home Loan Deposit Scheme would support the market instead of further weakening it.
“Although the number of loans is expected to amount to around 10,000, when you take this amount and add in the saving of the LMI, potential interest rate cuts and the flow-on effect on upgraders, this could support particularly affordable markets that are more appealing to first home buyers,” he said.
“Also, the Prime Minister has said he would like to run the scheme through second tier lenders and this will further improve the position of non-bank lenders in the market.”
Peleg said Labor’s proposed taxation changes, to limit negative gearing to new homes only and cut capital gains tax from 50 to 25%, would have “unintended consequences” and further impact an already weak housing market.
“The property market has been experiencing ongoing weakness,” he said.
“Tighter lending standards, the findings of the Banking Royal Commission, political uncertainty, fears of the potential changes to negative gearing and capital gains tax, restrictions on foreign investors, unit oversupply and large falls in dwelling commencements have all had a material impact."
 
 
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Coalition’s First Home Loan Deposit Scheme would support the market: RiskWise

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EXPERT OBSERVER
The property market will remain weak well into 2020 unless the RBA cuts interest rates and these are passed on by the banks.
However, it was the introduction of lending restrictions by APRA, followed by the greater scrutinisation of loan applications as a result of the Royal Commission, that was the catalyst for the downturn, has just released its latest Quarterly Risks &amp; Opportunities Report.
Tighter lending standards, the findings of the Banking Royal Commission, political uncertainty, fears of the potential changes to negative gearing and capital gains tax, restrictions on foreign investors, unit oversupply and large falls in dwelling commencements had all had a material impact on the property market.
The major risks associated with residential property have, and continue to be, significantly increased in comparison to the risk levels in the long term.
This is due to a combination of factors that are changing the face of the property landscape with no price increases and significant improvement expected until at least the end of 2020.
There’s an 80 per cent chance the ALP will come into power at the forthcoming Federal election and this win will see the implementation of their policy to limit negative gearing to new housing only and reduce the discount on capital gains tax from the current 50 per cent to 25 per cent to come into effect on January 1, 2020.
This will simply make property investment, in both existing and new dwellings, by far less attractive.
<a href="https://www.propertyobserver.com.au/Visit%20www.riskwiseproperty.com.au" target="_blank">RiskWise</a> demonstrated that fears of the proposed changes have already impacted the market with price reductions accelerating following the Liberal Party leadership spill in August last year. In addition, auction clearance rates dropped below 50 per cent towards the end of 2018 in both Sydney and Melbourne and are currently in the low to mid-50s.
Buyer sentiment had been greatly diminished with strong reductions in activity by investors who realised they had to wait for the election results, the implementation of the taxation policy, and a new low equilibrium point to be reached, before they could act.
Investors understand the potential increases to out-of-pocket expenses due to the taxation changes, which are equivalent to a significant and sudden interest rate increase of 1.15 per cent in the Sydney unit market.
RiskWise analysis shows there is an 80 per cent likelihood the RBA will cut interest rates during the second half of 2019 with a further cut before the end of the year or early 2020, with the banks ‘highly likely to pass them fully on to borrowers’. 
This will significantly reduce price reductions, particularly in the Sydney and Melbourne markets, and increase demand in the markets that have shown resilience and already enjoy good demand. Interest rate cuts have a direct impact on out-of-pocket expenses and also have an impact on buyer sentiment, particularly investors.
GDP growth is also below target, largely due to a reduction in dwelling commencements, and a drop in consumer sentiment has an impact on household spending.
In fact, according to ABS data, there has been a major reduction in household wealth, driven by a reduction of land and property values. While household wealth is falling, the household-debt-to-income ratio hit a new record just shy of 200 per cent.
While APRA has removed the 30 per cent interest-only lending cap, this is unlikely to have a material impact on the housing market. Banks will continue to mitigate the risks associated with interest-only loans in a market where the majority of the properties that are purchased or re-financed are depreciating assets.
In addition, there is a 7 per cent stress test (where many lenders set the stress test at 7.25 per cent) when it comes to the ability to service a loan making it extremely difficult to get approval from lenders.
Negative equity has also become a major risk, particularly for lenders who have concentration of loans in weak markets within Western Australia, Queensland and the Northern Territory.
Also, the majority of the properties that have been purchased in Sydney and Melbourne in the past couple of years have depreciated in value and properties that have loan-to-value ratio (LVR) of 90 per cent or more carry a high level of risk of negative equity.
The next quarter will be crucial for the housing market due to the election results and expected high level of certainty regarding RBA’s interest rate cuts, but expect the weak outlook to continue.
Macro-economic measures, particularly in relation to Consumer Price Index (CPI), employment and GDP growth will play central roles in whether there would be an interest rate reduction sooner rather than later.
Our analysis shows us however, that at least for the foreseeable future, and especially with the likely introduction of the taxation changes, that the weak housing market will continue with high levels of apartment supply, combined with low sales volumes, and a continuous reduction in dwelling commencements, that will help to absorb the high level of supply gradually over time.
State-by-State Overview:
In New South Wales, the combined effects of unaffordable housing, poor investment serviceability ratio and lending restrictions have led to a quick reduction in house and unit prices. In addition, there has been a significant reduction in investor activity. Without RBA interest rate cuts and / or a Labor loss in the federal election, Sydney is likely to experience continuous price reductions over the next couple of years, with an estimated annual reduction of 4-6 per cent for both this year and 2020. Some regional areas, however, are likely to hold well. An RBA interest rate cuts is likely to mitigate price reductions.
Victoria has the highest population growth in the country, enjoys a solid economy and a healthy job market. However, like NSW, dwelling prices have fallen, although to a lesser extent, as have auction clearance rates. Again, this fall can be attributed to the same factors as that of NSW – lending restrictions, significantly lower investor activity, fear of changes to the current taxation regime and expectations of price reductions. Therefore, without RBA interest rate cuts that are much needed to support this market and / or a Labor loss in the federal election, over the next couple of years, the prospect for the Melbourne housing market is negative with annual price reductions in the order of 4-7 per cent for both this year and 2020. However, a number of regional areas, in particular Geelong and Ballarat, which deliver solid capital growth, present only a low level of risk and are projected to continue delivering solid capital growth both in the short and long term.
The Australian Capital Territory delivered good economic growth and experienced the second largest population growth rate in the country, delivering capital growth and a relatively resilient property market. While growth rates have decelerated in recent months, dwellings in the ACT present a relatively low level of risk for major price reductions and are projected to deliver modest capital growth in the next couple of years. Houses are still enjoying, and likely to continue to do so, some capital growth while the unit market remains reasonable, although it does carry a higher degree of risk to deliver negative growth in the short term, particularly due to its reliance on investor activity.
The modest growth pace in the Queensland housing market continues although for units remains poor or negative. Some areas, particularly in South-East QLD including the Gold Coast and the Sunshine Coast, enjoy good population growth and healthy demand for houses. Other areas, such as Central QLD, are still experiencing poor demand for dwellings, very high vacancy rates and a very soft property market. An oversupply of units in inner Brisbane makes this market particularly susceptible to the impact of potential taxation changes. Other areas that have a high supply of new units also present high levels of risk, particularly where there are relatively affordable houses as, generally, houses are significantly preferred dwelling alternatives.
The South Australian economy has shown some improvement but still has a high effective unemployment rate which has led to very low population growth and soft housing demand meaning only modest capital growth is forecast for houses. However, houses in popular areas, such as Adelaide Central and Hills carry a low level of risk and are projected to deliver solid long-term returns. Some areas have unit oversupply and are experiencing weakness, particularly Adelaide CBD where poor growth is forecast.
In Western Australia, lending restrictions had the most impact thanks to its weaker economy. Perth prices, which had stabilised, began to fall once again. The impact is expected to increase if a blanket approach is also taken when implementing the proposed taxation changes. While the state’s economy has returned to positive growth, a combination of a very high effective unemployment rate, low population growth and a significantly below-average economic activity level has resulted in price reductions for both houses and units. Finally, units carry a very high risk due to the combination of oversupply, lending restrictions and low demand, particularly in central Perth.
Tasmania leads the country in investment serviceability with its high median rental returns and low average dwelling price. However, Hobart has gone off the boil, with CoreLogic figures showing a 0.9 per cent slide of dwelling prices last month. Houses fell 1.2%, while unit growth was only 0.3% in March. A significant increase in dwelling prices in recent years, less affordable housing, decelerated price growth, fewer people turning up to open home inspections and fewer inquiries on listings, indicate that housing affordability has made an impact and that the growth rate was unsustainable. It is projected to significantly decelerate in 2019 and further into 2020, with some areas likely to deliver very low or negative capital growth.
The Northern Territory experienced poor population growth resulting in negative dwelling growth and a very soft property market. Poor demand for dwellings and price reductions, combined with a relatively high median household income have resulted in the most affordable dwellings (i.e. the lowest price-to-income ratio) in the country. The property market is projected to remain soft, particularly for units. Furthermore, it is likely that the NT housing market will be a victim of unintended consequences from the blanket implementation of the potential taxation changes that will further reduce investor activity.
DORON PELEG is the CEO of <a href="https://www.propertyobserver.com.au/Visit%20www.riskwiseproperty.com.au" target="_blank">RiskWise Property Research</a>
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Interest rate cuts and election results keys to property market: Doron Peleg 

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The biggest recurring problem for real estate is politicians who don’t understand the industry. Which is pretty much all of them, on both sides of politics.
They also display a chronic inability to think through the consequences of their policies designed to impact housing markets. This sad truth is evident in the policies from both the major parties in the impending Federal Election.
We’re going into Saturday’s poll with no policies from any of the major parties that address the fundamental problems of the housing industry, of which affordability is the biggest. What they’ve served up just fiddles around the edges of the problem.
The Liberal Party has announced a plan that will make it easier for first-time buyers to get loans with smaller deposits, by supporting loans to people who have saved 5% of the purchase price. Federal Labor has given a “me, too” response to that policy (and why not, they’re spending like drunken sailors, why not just add this to the national credit card as well).
But the First Home Loan Deposit Scheme will be available to only a limited number of FHB borrowers and it fails to address the core issues – the price they will pay for properties and the associated costs of getting into the market.
Labor’s core policy is changing negative gearing tax benefits. This is a revenue measure dressed up as a policy to improve housing affordability but clearly it won’t make a positive difference, while creating myriad problems elsewhere.
Whenever they’re asked whether their negative gearing policy will force down house prices, Bill Shorten and Chris Bowen are adamant that it won’t. That being the case, how does it improve affordability? The answer is: it doesn’t. It’s purely a revenue measure.
What the policy will do is put first-home buyers in direct competition with investors for new properties.
This is the polar opposite of the Labor’s stated intentions, because they say they want to prevent FHBs having to compete with investors. These clowns simply don’t understand their own policy or its consequences.
Currently most first-time buyers have to buy or build a new home if they want a state grant. And investors are encouraged to buy new by the recent changes to depreciation benefits. Now Labor says investors will get tax benefits through negative gearing only if they buy new.
So everyone will be compelled to buy new rather than established property. Labor’s policy puts FHBs on a collision course with investors.
The thing is, most buyers don’t want to buy new because it’s usually considerably more expensive than a comparable second-hand home. The core problem in real estate, and none of the major parties are addressing this, is the high cost of creating new dwellings in Australia. 
The costs are so high because all three levels of government milk real estate for revenue. They treat the housing industry as their favourite cash cow. Stamp duty, land tax, capital gains tax, GST, rates, infrastructure charges, application fees, the list goes on and on.
Every time a state or territory government brings down a budget, it adds to the affordability problem by increasing existing imposts or imposing new ones. It’s relentless and it’s the core of the affordability problem.
Everyone (if Labor wins) will be pushed to buy new property but the prices are unreasonably high, thanks to our cynical politicians.
This is occurring at a time when new supply is drying up, partly because federal and state policies have extinguished the contribution of foreign investors – officially to help FHBs but in truth just another grab for cash. 
The surcharges placed on foreign investors in Australian real estate are revenue-raising measures, pure and simple, but they’re hurting Australian buyers by killing off projects that can no longer make the required level of pre-sales to get funding. The reduced supply is just another component of the affordability problem. 
Another unforeseen consequence of the Labor policy will be a revival of the spruiker industry. With most categories of buyers being compelled to buy new – e.g. off-the-plan apartments – we will see a revival of the get-rich-quick seminars that used to proliferate, where crooks make lots of money by ripping off unsuspecting consumers.
So it's not much of a choice this Saturday for voters who care about the housing industry and its related issues, like housing affordability. 
Labor proposes to increase the taxation burden on the real estate industry, which will worsen the problem, and the Liberal pitch may make it easier for FHBs to get a loan to buy a home, but it won’t make the cost of the home cheaper.
It’s a choice between dumb and dumber.
Terry Ryder is the founder of hotspotting.com.au
<a href="https://mailto:ryder@hotspotting.com.au">ryder@hotspotting.com.au</a>
twitter.com/hotspotting
Currently MOST first-time buyers have to buy or build a new home if they want a state grant
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FHB deposit guarantee scheme shows politicians don't understand the housing market: Hotspotting's Terry Ryder

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First home buyers will get government support to get to a 20 per cent house deposit if either the coalition or the Labor Party wins the federal election.
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Prime Minister Scott Morrison announced the policy at the Liberal election campaign launch in Melbourne on Sunday, which was then matched by Bill Shorten.
The First Home Loan Deposit Scheme will be available to first home buyers who have been able to save for a deposit of at least 5 per cent.
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<div id="article-titan-mobile-pos1" class="advertisement">Under the plan, the National Housing Finance and Investment Corporation would guarantee the difference between five per cent of the purchase price and the 20 per cent deposit.</div>
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The PM said all the normal checks would apply to borrowers to make sure they could meet their expanded payments.
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The scheme is based on the belief it is the deposit gap rather than the size of mortgage payments that is the real barrier to home ownership.
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The scheme, adopted from a 2015 New Zealand scheme, would allow singles earning less than $125,000 a year and couples earning less than $200,000 a year to get into the housing market in quick time.
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Past schemes, including the first home super saver (FHSS) scheme, have simply been too slow in achieving outcomes. 
The $500 million scheme is set to be initially capped at 10,000 loans annually, about one tenth of the market. 
Some 110,000 bought their first home in 2018, which was the highest level in nine years.
But the latest NSW figures for March show the lowest number in two years.
Although it has fallen in recent months, an entry-level Sydney apartment costing $560,000 takes around five years and four months savings for a 20 percent deposit, some 16 months longer than in Melbourne and two years longer than the equivalent in Brisbane.
The scheme will also help first home buyers save around $10,000 by not having to pay Lenders Mortgage Insurance.
The First Home Loan Deposit Scheme will start on 1 January next year.
The value of homes that can be purchased under the Scheme will be determined on a regional basis, reflecting the different property markets across Australia.
"With the banks pulling back and larger deposits of 20 percent now being standard, it is not getting easier," Scott Morrison said.
“The lenders would still be the ones lending the money. They would still do all the normal checks on the borrowers to make sure that they can meet their repayments – this isn’t free money."
<div>There will be a small risk for the government having first time borrowers with higher indebtedness especially if the market continues to fall.</div>
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<div>No official figures are kept on first home buyer arrears or distressed sales, but the even now more cautious big four banks maintain overall arrears levels across NSW remain very low given the low interest rate landscape.</div>
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The National Housing Finance and Investment Corporation will partner with private lenders to deliver the First Home Loan Deposit Scheme, prioritising smaller lenders to boost competition.
The latest Roy Morgan Poll shows that Labor's lead over the Coalition on a two-party preferred basis has narrowed to 51%-49%. 
With the Coalition now back in contention, Roy Morgan CEO Michele Levine says trust and distrust will determine the outcome of the election, and any "glaring mistake" could cost Scott Morrison or Bill Shorten the prime ministership. 
Roy Morgan's executive chairman Gary Morgan expects a hung parliament, with minor parties and their preferences to play a major role.
<div class="advertisement">The $500 million scheme will allow Australians to buy their first home with a deposit of just five per cent rather than 20 per cent, with the government to underwrite the balance via its National Housing Finance &amp; Investment Corporation.</div>
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<div id="google_ads_iframe_/21666581298/cessnockadvertiser/news/nationalnews_0__container__">"The support would stay in place for the life of the loan," Mr Morrison said on Sunday.</div>
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"They've got their first leg on the first rung of the ladder."
Morrison told the party faithful at the Liberal Party’s campaign launch in Melbourne that the policy would make a big difference to first-home buyers, “cutting the time taken to save for a deposit by at least half”.
“It can take nine to 10 years for an average household to save a deposit,” he said. 
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First home buyers with 5 per cent deposit will have government backing to get it up to 20 percent deposit 

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EXPERT OBSERVER
As this year’s federal election fast approaches and Scott Morrison and Bill Shorten campaign throughout the nation, the state of the national property market continues to be a key matter of contention. 
The Labor Party has pledged to make sweeping changes to negative gearing and capital gains tax whilst the Liberals have suggested they will be relying on the Reserve Bank of Australia to cut interest rates – which could come as early as this week - in a bid to regenerate market activity. 
But what both parties have yet to fundamentally address is just how much the property industry serves the economy, and the policies that are required to ensure the market can continue to be an important driver for the economy as it once was, and help fund the major infrastructure projects that both parties have pledged to deliver should they be elected come May. 
Take for example Labor’s planned changes to negative gearing, which on the surface look to be a win for first home buyers – albeit at the expense of investors who play a vital role in providing rental stock and therefore are critical to the economy - and, according to ALP calculations, would save $2.9b in tax concessions over four years. 
Alternative projections however, paint a different picture. Labor’s proposed changes will be grandfathered, so current investment properties will not be affected by the changes – no savings to the country’s purse pocket to be had there. Meanwhile both the state and federal governments’ ‘anti-investment’ sentiment has all but eradicated investors from the market altogether since sweeping regulatory changes took effect in 2017. 
Tighter lending restrictions coupled with declining construction rates mean first home buyers are unlikely to produce the same momentum that investors once did, so it’s doubtful this activity will generate the economic impact that is required over the long-term. 
In fact, if former Liberal treasurer Joe Hockey is to be believed, a similar play in the early 1980s under the Hawke Government led to rent increases that impacted household earnings, therefore affecting buyers’ ability to enter the market altogether, which ultimately led to negative gearing being reinstated in 1985. 
But why should this worry the voters? Without the significant cashflow generated from the property market, infrastructure projects become difficult to fund, carrying a heightened risk of a budget deficit blow out or new taxes to cover the costs. Layer that on top of already declining consumer confidence and a languishing property market, we will see sentiment plummet even further, quickly – carrying with it all the markers of a major recession. 
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Instead of focusing on handouts and short-term strategies in an effort to lure voters, what we need is a long-term outlook and a set of bold policies to encourage cash inflow into Australia at an international level. 
A plan to support first home buyers while cutting off investors or vice versa, all the while turning our backs to capital injections from international markets, will no longer cut it - without addressing the bigger picture, the mounting bill for major infrastructure projects both planned and underway, will soon become too big to ignore. 
Ever since the property boom peaked in 2017 and sweeping federal regulatory changes were introduced, ‘international investment’ has become a dirty word. So much so that both major parties have completely backed away from any policies that would relax these restrictions and once again entice foreign capital, for fear of incurring the wrath of voters. 
It’s the elephant in the room that neither party has addressed. 
But what many fail to realise is that this same foreign capital led to sustained development activity, providing much-needed cashflow into the country – which has subsequently helped to fund many of the projects that are currently underway - as well as generating countless construction jobs and economic prosperity, all of which are now steeply on the decline. 
When Canada enforced similar restrictions to overseas cashflow in 2018 after a sustained property boom where prices rose over 300 per cent1 in 15 years, the effects on their housing market were swift, causing a significant chain of reactions that are still, painfully, at play. 
House prices in Vancouver have decreased close to 8 per cent on the previous year, while sales volumes have slowed to the lowest rates in 30 years. Housing analysts first speculated that this would encourage an uptake of first home buyers finally getting their foot in the door, however the stringent lending restrictions at a local level means these buyers are still unable to get into the market despite the price correction.2 
Sound familiar? 
In fact property prices in Vancouver are on the decline so quickly, analysts are forecasting that soon home owners in high-risk pockets could owe more on their mortgages than there is value in their homes, creating a catastrophic negative equity environment, the likes of which we last experienced in the lead up to the Global Financial Crisis in 2008. And that’s where things start to get very scary. 
A controlled reintroduction of foreign capital in Australia is not to say there should not be stringent prudential regulations in place to safe-guard the way in which this investment flows and where it is directed. The days of large-scale high rise developments selling overwhelmingly to foreign investors are behind us, and so should they remain.
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If managed correctly, there are a myriad of ways offshore capital can be encouraged into the economy. This would avoid placing such upward pressure on residential property prices, thus allowing our local home buyers the opportunity to gain a foothold into the market while protecting our economic outlook into the future. 
What we need is a policy that relaxes restrictions enough for local buyers to access the market and allows Australia to once again court overseas investment while supporting the economy as we spend up big funding infrastructure upgrades across the country. We need strong leadership in this space where decisions should be made to drive our economy forward, rather than what appeals to a small contingent of voters in the short-term. 
Without a robust policy to encourage local sales and open the doors to international capital, what our major political parties will gain in the short-term, the everyday Australian will lose out in the long-term.
Leonard Teplin is the director of projects at the <a href="https://www.marshallwhite.com.au/agent/leonard-teplin/" target="_blank">Melbourne-based Marshall White</a>.
 
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