There are few property developers nationally that can boast a workbook like the ASX-listed developer Cedar Woods. With eight apartment buildings under construction across four states, Cedar Woods is well positioned to take advantage of what Managing Director Nathan Blackburne says is a “national shortage of apartments.”

Cedar Woods purposefully has a diversified portfolio of apartments, townhouses, commercial, and residential communities across the country, enabling the business to remain resilient through market cycles and respond to shifting buyer demand.

Blackburne says there is a great shortfall of housing of all typologies, none more so for apartments. He says that is the case particularly in Perth, where the lack of new apartment projects has been particularly acute.

“Perth has been more affected than Melbourne,” Blackburne explains, noting that over the past five years, “very few new apartment projects” have been launched in either city. Historically, apartments made up around 20 per cent of new housing nationally. Cedar Woods estimates that figure has fallen to around 10 per cent today, a gap they believe must close.

<h2>Apartment appeal rebounding as supply shrinks</h2>

There are signs the tide is turning however. Blackburne says buyer apartment sentiment really picked up in mid 2025. “In October we saw our strongest sales month for apartments in Perth.” The buyer demand has driven their Subiaco apartment development, Incontro, to nearly 70 per cent sold. The increased buyer sentiment has strengthened Cedar Woods’ confidence in bringing forward the next apartment project in Western Australia, a three tower development planned for the prime site on Upham Street in Subiaco, adjacent to Incontro.

Demand is being driven by several factors; the lack of new apartments coming to the market, the increased demand with migration far outstripping the aforementioned supply, and the appetite to live closer to the city.

“Over the past three years, Perth’s population has grown by around 250,000 people, while only around 50,000 dwellings have been delivered,” Blackburne says, adding that more than twice that number would be needed just to keep up.&nbsp;

He said that many buyers are being forced to the urban fringe because of the greater supply of land product, but that, Blackburne argues, is pushing the fringe further out and motivating a re-evaluation of the value of inner- and middle-suburb apartments.

Demographic shifts are helping drive this rethink. Cedar Woods is seeing more boomers downsizing, young professionals entering the market, and a rising number of single-person households. There’s also a growing trend of parents buying apartments for teenage children, motivated by fears that housing prices will become out of reach. “It’s not only a strong investment now, but it can serve as a first home when their children move out.”

<h2>National diversification strategy</h2>

Cedar Woods’ strategy is not limited to Perth. Blackburne outlines their aim to diversify by price point, product type, and geography, which “gives us a broad customer base and smoother earnings profile.” Throughout their markets, they’re combining apartments, townhouses, and masterplanned communities, allowing flexibility to pivot toward undersupplied segments as demand evolves.

In Victoria, Cedar Woods is pressing ahead with a major site in Fairfield, just northeast of Melbourne’s CBD, a site which Blackburne says the company has had its sights on for many years. They are planning to deliver three towers with over 300 apartments, with the plans likely to be submitted in early 2026.

Blackburne also expresses optimism about broader inner-Melbourne supply dynamics. 
 
“While Melbourne’s apartment market is better supplied than Perth’s, and population growth remains strong, Cedar Woods believes the current stock will be absorbed quickly,” Blackburne says, however he warns that policy disincentives remain. “In Victoria … there are quite a lot of obstacles for apartment buyers,” he says, adding that the industry is working with the state government to “remove those barriers” and avert prolonged undersupply.

Cedar Woods has plans on the desks of the VIC Government to develop a 20-storey tower in Southbank, in the heart of Melbourne’s arts precinct. Designed by Rothelowman, the proposed tower will deliver 180 apartments, ranging from studios to three-bedrooms, along with creative amenity space devoted to arts and digital industries, a food and drink tenancy at street level, and a 700sqm recreation deck with indoor lounge space will provide a resident amenity hub.

Blackburne frames the project as a response to Melbourne’s growing undersupply of signature inner-city living. “We saw a thematic: a looming undersupply in inner-Melbourne, particularly in high-quality apartments, and wanted to capitalise on that,” he says. The site’s proximity to the Melbourne Arts Precinct, key tram lines, and Southbank’s cultural fabric makes it especially appealing, Blackburne says.

<h2>Charting the course forward</h2>

On top of the apartment developments underway and planned in Perth and Melbourne, Cedar Woods has a multi-stage apartment development in Brisbane’s Woolloowin, and several years remaining on their masterplanned communities in Williams Landing in Melbourne and Glenside in Adelaide, both of which offer a mix of apartments and townhouses.

Blackburne says the developer has been able to mitigate some of the macro risks currently at play in the new development space, particularly in the construction sector.

“Cedar Woods has been able to make many apartment projects work because of good buying of the raw land in the first place, as well as its strong pipeline of apartment projects, enabling the company to attract builders to build deep, multi-year relationships.”&nbsp;

For Cedar Woods, 2026 is set to be significant, with anticipated approvals and submissions laying the groundwork for fresh apartment supply and multiple launches in 2027.

&nbsp;

Joel Robinson

Cedar Woods ramps up apartment development amid Australia’s deepening housing shortfall

Rockdale has long been characterized as a suburb on the cusp. Well-located, well-connected, but historically underserved by modern apartment offerings.

It has everything going for it: outstanding connectivity to the Sydney CBD, just four train stops to Central Station, strong local amenity anchored by Roc​kdale Plaza and a growing main-street dining scene, and enviable proximity to Brighton-Le-Sands. The six-kilometre beachfront is lined with bayside restaurants, cafés, and walking paths, giving residents a lifestyle typically associated with much more expensive coastal suburbs.

What Rock​dale has lacked is high-quality contemporary apartments. Most existing developments date back several decades, with floorplans that no longer support modern living needs, and buildings constructed long before today’s standards in engineering, efficiency, and sustainability.

Lender, fund manager and apartment developer Princeton identified the gap early. Seeing all the right ingredients in Rockd​ale, transport, lifestyle, retail, and affordability, they set out to deliver what the suburb was missing. Their answer is <a href="https://www.apartments.com.au/new-apartments/marque-rockdale-602-608-princes-highway-rockdale-nsw-2216">Marque Rockdale</a>, a collection of 58 one-, two-, and three-bedroom apartments now nearing completion just a short walk from Ro​ckdale Plaza, home to over 50 specialist retailers and anchored by&nbsp;Woolworths, Big W and Aldi.

[smartcode_project:default project_id=136442 project_image_fid=355216]

Understanding they would be resetting the benchmark for the area, Princeton focused on ensuring buyers received best-in-class quality, longevity, and protection.

A major step was securing the sought-after Latent Defects Insurance policy from Resilience Insurance. This policy protects apartment buyers from structural or waterproofing defects for the first 10 years of the building’s lifecycle. Crucially, it is first-response insurance, meaning that if an issue arises, the insurer pays immediately for remediation—rather than waiting for lengthy investigations to determine fault before work can begin. For purchasers, it offers an unprecedented layer of security rarely seen in Sydney apartment projects.

During construction, independent building inspection firm SDSS has been providing Technical Inspection Services, bringing highly specialised construction experts on-site at key stages to ensure workmanship meets the highest standards. The project is being built by Coplex, an iCIRT-rated construction company, and throughout the build SDSS has frequently referred to <a href="https://www.apartments.com.au/new-apartments/marque-rockdale-602-608-princes-highway-rockdale-nsw-2216">Marque Rockdale</a> as one of the best projects currently on their books.

Princeton also doubled down on comfort, acoustics, and livability.&nbsp;As well as being the only building along Princes Highway with a landscaped buffer between the building and the road, Princeton has purposefully included double-glazed windows in all apartments to reduce noise.

Apartments feature double-glazed, noise-reducing windows and ducted air conditioning in every residence.&nbsp;In addition to the project’s transport convenience, Princeton has partnered with GoGet Car Share to provide a dedicated GoGet vehicle housed permanently within the building. Residents will receive a free annual GoGet membership, paying only usage fees, offering a flexible alternative to owning a second car and enhancing the project’s sustainability credentials.

[smartcode_project:default project_id=136442 project_image_fid=277075]

Residents will enjoy an exclusive rooftop oasis, purpose-designed as an extension of their living space. The communal rooftop includes BBQ facilities and outdoor entertaining areas, a&nbsp;pergola-shaded dining zone, a dedicated children’s play space, and a landscaped herb garden.

Princeton and Coplex is approaching completion of <a href="https://www.apartments.com.au/new-apartments/marque-rockdale-602-608-princes-highway-rockdale-nsw-2216">Marque Rockdale</a>, and are expecting residents to move in early in the new year. The mix of apartment configurations and price points have been a hit with young professionals, those who need to commute to the CBD, and families who appreciate doorstep amenity.

“Marque is a place where residents will be proud to call it home," Princeton Head of Development George Young says.

"We’ve worked really hard with Coplex and our design team to deliver an incredible building for the future home owners to make their own. The homes are all designed to allow the residents to make it their own, a place to belong and live a stylish urban life."

[smartcode_project_cta:default project_id=136442]

Marque Rockdale sets a new standard of apartment living in Sydney's south

Plans to revitalize the&nbsp;long-established Benowa Gardens Shopping Centre into a mixed-use community combining living, shopping, dining, health and wellbeing facilities, have been proposed to the Gold Coast City Council.

The Benowa Gardens Urban Village proposal by Benowa Gardens Holdings seeks to transform the 17,660 sqm site at <a href="https://www.apartments.com.au/new-apartments/203-ashmore-road-benowa-qld-4217">203 Ashmore Road</a> into a contemporary, sustainable destination that reflects global trends in modern community design while retaining the familiar local character residents value.

The site is bordered by Ashmore and Benowa Roads and Carrara, with ready access to Pindara private hospital, four schools, TAFE, sports fields and the nearby Botanic Gardens.

Benowa Gardens Holdings is seeking a preliminary Council approval only for its proposed masterplan and variations to the site’s Neighbourhood Centre zoning.&nbsp; 
Formal Public Exhibition commenced Friday and also marks the start of comprehensive community consultation with surroundings residents, schools, P&amp;Cs, existing retailers, nearby sporting clubs, arts groups and Botanic Gardens volunteers.

Designed by Neylan Architecture, the masterplan envisions around 413 new apartments, complemented by upgraded retail, dining, and wellness amenities as part of 10,000 sqm of retail, and 9,630 sqm of office space/medical suites.

The development will feature green open spaces, shaded promenades, landscaped terraces, pedestrian walkways, and expanded healthcare and lifestyle services in synergy with the neighbouring Pindara Private Hospital and local schools.

<img alt="Benowa" data-entity-type="file" data-entity-uuid="244f4d54-2e67-4141-92b8-78d5735f47c2" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202025-11-26%20at%2012.47.34%E2%80%AFPM.png?VersionId=FmF5lzhpwVZc7POsdB770TJ_Bf2c0od8" />

“This concept embraces the way people increasingly want to live - safely, conveniently, and within strong local communities,” said Patrick Lu, Director of Benowa Gardens Holding.

“Benowa Gardens will set a new benchmark for integrated living on the Gold Coast. It’s a thoughtful, community-minded evolution that brings global best practice in urban design to one of the city’s most established areas.”

Lu said this isn’t just a redevelopment, it’s a renewal with purpose.

“Benowa Gardens has served the community for decades. Our goal is to ensure it continues to do so for generations to come, as a lively, connected Urban Village where people can truly live, work and thrive. We’re already talking to school leaders and the community to seek their feedback on our proposal, and have taken on board their ideas to improve student safety with additional “traffic calming” measures on Carrara Street. We’re conducting meaningful and sincere consultations and want to play our role in preserving and enhancing the local community."

The proposed redevelopment aims to deliver tangible benefits across the Benowa and wider Gold Coast community, including:

<ul>
	<li>Improvement of retail amenity, to capture the under-served local market demand and keep the local business at their local shopping centre.</li>
	<li>Housing diversity; offering a range of apartment types for key workers, downsizers, and local families who wish to remain in the area.</li>
	<li>Enhanced shopping and dining; revitalised retail spaces designed to support local businesses and attract more visitors.</li>
	<li>Health and wellbeing access; additional medical and wellness amenities to complement existing local facilities.</li>
	<li>Improved traffic flow and access; two new access points, upgraded intersections, upgrade pedestrian pathway’s signal and proposed upgrade of pedestrian and cycle connections/space to improve safety and convenience, especially for school children.</li>
	<li>Environmental sustainability; energy-efficient design, green rooftops, and water-sensitive landscaping to reduce emissions and enhance comfort.</li>
	<li>Local jobs and investment; supporting hundreds of construction and long-term roles while stimulating local economic growth.</li>
</ul>

The group behind the project boasts extensive experience in the property development industry, both in Australia and international markets. Over the past 23 years, the group has been involved in the development and management of a diverse portfolio of assets including residential dwellings, shopping centres, bulky-goods stores, community and medical facilities, childcare centres, offices, hotels, and taverns, across Brisbane, Ipswich, and the Gold Coast.

Benowa Gardens to become new mixed-use urban village

Demand for townhouses in Melbourne’s inner west has surged as buyers seek the elusive combination of space, affordability, and location.&nbsp;

With family-first apartments increasingly rare and standalone homes often out of reach, townhouses have emerged as the new sweet spot, delivering generous living areas with lower maintenance needs within close proximity to the Melbourne CBD.&nbsp;

<a href="https://www.apartments.com.au/new-townhouses/kings-lane-south-kingsville-50-58-new-street-south-kingsville-vic-3015">Kings Lane</a>, the new under-construction townhouse development by the family-owned developer&nbsp;<a href="https://www.apartments.com.au/developers/blue-run">Blue Run</a>&nbsp;in South Kingsville, responds directly to this trend. Comprising just 25 residences designed by <a href="https://www.apartments.com.au/architects/rothelowman">Rothelowman</a>, the project offers a compelling alternative to both apartment downsizers and family upsizers. With three-bedroom homes priced under $1 million, it presents one of the area’s rare attainable pathways to townhouse living less than eight kilometres from the CBD.

[smartcode_project:default project_id=145042 project_image_fid=355147]

<a href="https://www.apartments.com.au/developments/south-kingsville-vic-3015">South Kingsville</a> itself is quietly becoming one of Melbourne’s most dynamic pockets of urban renewal. Flanked by the established appeal of Yarraville, Newport and Williamstown, the suburb balances quiet, village-like streetscapes with major infrastructure upgrades and a growing slate of retail, dining and lifestyle amenity.&nbsp;

Kings Lane occupies a well-connected site at 50–58 New Street, just off Blackshaws Road and within walking distance of the emerging Union Quarter precinct, a major retail destination anchored by Woolworths, specialty food outlets and wellness services.

A 400-metre stroll brings residents to the Vernon Street shops, a local favourite known for its mix of independent grocers, cafes and family-run eateries. For broader shopping options, Altona Gate Shopping Centre and Yarraville Square are both within a short drive. Spotswood IGA and the Williamstown retail strip further broaden the convenience of daily essentials.

[smartcode_project:default project_id=145042 project_image_fid=355139]

Dining options in the area lean toward eclectic and community-driven, with standouts like Rocco’s Deli, Dad and Dave’s, and Pizza d’ASPORTO offering a range of casual and elevated menus. Cafés such as Hudson Road Wine &amp; Beer and Blacksheep Coffee add to the lively yet local feel of the neighbourhood.

Green space is another hallmark of life at Kings Lane. Edwards Reserve is close enough for morning walks or casual sport, while larger parks like Newport Lakes, Yarraville Gardens, and Cruickshank Park are all a few minutes’ drive away. More than half of the nine-hectares of new green space or parkland being created as part of the West Gate tunnel works is located just at the end of New Street, the same street as Kings Lane.

&nbsp;

For those with school-age children, South Kingsville is home to a range of quality childcare centres and schools, including Kingsville Primary, Spotswood Primary, and Williamstown North Primary. Community Children’s childcare and South Kingsville Preschool are nearby, making the suburb particularly attractive to young families.

Transport links continue to improve, with Spotswood Station and the West Gate Freeway both within a five-minute radius. Future upgrades, including the proposed sky rail for Newport and Spotswood, and the delivery of the West Gate Tunnel project, promise even better access to the CBD and Melbourne Airport in the years to come.

Kings Lane's 25 all-electric townhouses are currently under construction, and will complete in late 2026.

[smartcode_project_cta:default project_id=145042]

Staff Writer

Kings Lane townhouses offers rare value in Melbourne's thriving inner west

Developer-builder <a href="https://www.apartments.com.au/developers/billbergia">Billbergia</a> has set a new apartment price record for <a href="https://www.apartments.com.au/developments/rhodes-nsw-2138">Rhodes</a>, a suburb the company has been instrumental in transforming over the past two decades.

The milestone follows the delivery of thousands of apartments across the harbourside peninsula, culminating in the $4.5 million sale of a 220 sqm penthouse in the <a href="https://www.apartments.com.au/buildings/rhodes-central-oasis-39-marquet-street-rhodes-nsw-2138">Rhodes Central Oasis</a> building, which Billbergia completed earlier this year. It is the first apartment in Rhodes to surpass not only the $4 million mark for settled sales, but also the $3 million mark, eclipsing the previous $2.75 million record set in 2021.

The purchaser had originally secured several apartments in the 40-storey tower off the plan as investments. During settlement, she spent more time in the Rhodes area and was so impressed with the building that she decided to downsize from her Northbridge home into the four-bedroom plus MPR penthouse.

The sale underscores the long-term work Billbergia has undertaken in Rhodes since the early 2000s. The company, rated 4.5 Gold Stars under the NSW iCIRT system, identifying it as one of the state’s most trustworthy and financially secure developers, was a pioneer of the area’s urban renewal. What was once a heavily industrial waterfront has become one of Sydney’s most successful examples of transit-oriented development.

<img alt="Billbergia" data-entity-type="file" data-entity-uuid="56093d7f-db18-42f4-bf9b-115bdf76f5f3" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202025-11-26%20at%2011.10.06%E2%80%AFAM.png?VersionId=pca77Mr.H83nwXbJexmaLUAqBewtQ7d9" />

Billbergia is now driving the peninsula’s next major evolution: the most ambitious project in its nearly four-decade history. They are planning the Rhodes Bay Masterplan, an eight-tower, mixed-use precinct on Leeds Street. Currently with the NSW Government’s Housing Delivery Authority which is now championing large-scale projects across the state, the Rhodes Bay Masterplan lays the groundwork for a generational reshaping of this important pocket of Sydney’s Inner West.

The masterplan spans more than 31,000 sqm of amalgamated industrial land along the foreshore, land that has been privately held and inaccessible to the community for more than a century. According to Billbergia’s Development Director, Saul Moran, reclaiming this land for public use is central to the company’s vision. 
 
“What’s so exciting is that we have over 300 metres of privately-held industrialised waterfront, land that’s been locked away for more than 100 years, which we’re bringing back to the community,” he says. “It’s taken many years to assemble sites like these, and the goal now is to transform them into meaningful public space where new homes can be built in an integrated, amenity-rich setting.”

At full completion, the Rhodes Bay Masterplan is expected to deliver over 2000 apartments, with the first 1000 to be completed by 2029. Billbergia’s design focused on nine slender towers, so they could give back more to the ground plane. There will be more than 16,000sq m of new parkland and recreation space, including sports fields, a foreshore play area and waterfront green links. Around 14,600 sqm of retail is also proposed, extending the precinct’s role as a true mixed-use hub.

<img alt="Rhodes Bay" data-entity-type="file" data-entity-uuid="240ffc41-4f26-421a-9606-5c56f6fc2d93" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202025-11-26%20at%2011.05.48%E2%80%AFAM.png?VersionId=BkBxZr7S8CAt1vgNa8AF3zjdc3YuVh0L" />

“Density only works when it’s paired with amenity, transport and open space, and that’s what’s made Rhodes such an amazing success story,” Moran says, adding that the demographic shift Billbergia has seen over the last two decades has informed their future development pipeline in the suburb.

“Rhodes has moved from being largely an investor market to a strong owner-occupier community,” Moran says. “There’s real demand for three-bedroom homes, flexible intergenerational layouts, and apartments people can grow into.”

&nbsp;“We’re designing taller, more slender towers to free up the ground level for sport, recreation and green space. High-density communities thrive when people have the best backyards in Australia, and that’s what we want to create here.”

Demand remains robust, evidenced by Billbergia’s recent results. “We achieved a record sale across the entirety of Rhodes Central just last week,” Moran says. “It shows the depth of confidence buyers have in what’s being built here.”

Billbergia’s vertically integrated model allows them to overcome the recent cost escalation and challenges in the build environment. “Having an in-house construction team lets us control feasibility, value management and quality from day one,” Moran says. “It’s critical in the current market, where construction escalation is at the forefront of every project’s viability.”

The company is also leveraging the NSW Government’s new Housing Delivery Authority process, which Moran describes as a more efficient pathway without compromising design standards. 
 
“We’re really applauding the NSW Government for its efforts to increase housing supply. There’s been a remarkable improvement in how they’re helping deliver more homes, more quickly.”

Billbergia has already commenced construction of Stage One of the Rhodes Bay masterplan. They will be lodging the State Significant Development Application before Christmas.

“We’re moving quickly, but with due care,” Moran says. “This is a generational precinct, and it needs to be done right.”

Billbergia smashes suburb record as Rhodes transformation continues

Financial Regulation

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Investors should expect regulations that allow self-managed superannuation funds to borrow to buy property to come under government scruitiny in the coming months, an expert in the area has said.
In February, Assistant Treasurer Arthur Sinodinos ruled out a specific review into limited recourse borrowing arrangements which SMSFs use when taking out loans to buy property.
Macquarie Bank executive director David Shirlow told Property Observer it was unlikely that the government would change its position, despite Senator Sinodinos standing aside and Finance Minister Mathias Cormann taking over as Acting Assistant Treasurer.
“Whilst the prospect of a separate and specific review of the matter is off the policy agenda for the time being, there are still some live policy issues in borrowing through super,” said Shirlow, who specialises in SMSFs and sits on the board of the SMSF Professionals’ Association of Australia (SPAA).
He said some stakeholders had argued that it was inappropriate for SMSFs to borrow for property investment at all, and that further constraints on advice provided regarding limited recourse borrowing arrangements and product offerings could be considered.
The arrangements are likely to be examined as part of the Financial System Inquiry, which is due to publish an interim report in mid-2014 and a final report by November.
Numerous submissions to the Inquiry have called for government to review SMSF borrowing and put in place additional consumer protection measures and education for trustees.
Big four accounting firm KPMG noted in its submission that super funds were tax-exempt in the pension phase, which provided incentives for SMSFs to invest in long-term assets such as residential property, and even more so if the property was negatively geared.
The Institute of Chartered Accountants in Australia strongly encouraged a review of existing arrangements to ascertain whether borrowing was appropriate and, if it was, to ensure the right legislative and regulatory frameworks were in place.
Mid-tier accounting firm Chan &amp; Naylor called for urgent action to create a dedicated national SMSF educational framework, lead by the Australian Securities and Investments Commission (ASIC), to teach the public about the merits and pitfalls of SMSF investments.
The Reserve Bank of Australia noted that SMSFs borrowing could expose members to greater financial risks (including excessive concentration in a single asset) than they understood they were taking.
CPA Australia raised concerns about the appropriateness of advice received by SMSF trustees and members, and potential misinformation being provided by unlicensed advisers such as real estate agents, mortgage brokers and property developers.
Shirlow said ASIC considered itself to have jurisdiction, under the Corporations Act, over some aspects of property sales people giving advice on limited recourse borrowing arrangements.
“Stakeholders such as SPAA would argue that there should be some more definite consumer protection rules in place to make sure that property spruiking is not going to lead to disaster,” he added.
The Association of Superannuation Funds of Australia has previously advocated for advice to SMSFs on asset classes such as investment property and limited recourse loans to be provided only through licensed financial planners.
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Investors should expect SMSF borrowing to come under greater government scrutiny

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The Council of Financial Regulators (CFR) met to discuss financing conditions, the housing market, Cyber risk initiatives and the lending market.
During the meeting they said that growth in housing credit remains subdued overall, with credit to investors particularly weak.
Owner-occupier loan commitments and housing turnover in Sydney and Melbourne have picked up, suggesting that a strengthening in credit growth is likely.
Mortgage lending standards have been broadly unchanged recently.
Overall, near-term risks related to the housing market have lessened as housing market conditions nationally have improved.
Members discussed the potential for the current weakness in apartment construction to place upward pressure on prices in some cities over time unless construction picks up. They also discussed the tight credit conditions for small businesses and the reduced risk appetite by many lenders for lending to small business.
Concerning responsible lending new ASIC guidance will confirm that responsible lending requirements do not apply to loans made predominantly for business purposes, regardless of the type of security offered for the loan.
Council members stressed that the flow of credit is fundamentally important to the functioning of the Australian economy and discussed the concern that lenders' risk appetite for some types of lending may have swung too far towards caution.
The CFR met with representatives of the Department of Home Affairs and the Australian Cyber Security Centre (ACSC) to review the current cyber security environment. They also discussed key initiatives to improve cyber resilience, including the development of the Government's 2020 Cyber Security Strategy, and application to the financial sector.
Council agencies, the Department of Home Affairs and the ACSC will continue to cooperate to improve the preparedness of the financial sector.
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Council of Financial Regulators say short term housing market risks lessen

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Louise Sylvan's review of Financial Counselling Services has been released with banks hoping it will help them chart a path towards strengthening Australia’s financial counselling sector.
The Review highlights systematic issues that have plagued the the industry, while noting the importance of financial counsellors in helping Australians who are struggling to repay their debts, manage their household budgets, and provide for their families in a difficult environment.  
The CEO of the Australian Banking Association, Anna Bligh, said that financial counsellors were important to Australians and the banking industry who see them as valuable partners in helping vulnerable customers.
“Financial counsellors get people back on track when they’re experiencing some of the most difficult moments in their lives and provide a valuable education service to people with lower levels of financial literacy and capability,” Ms Bligh said.
“This review charts an important path forward to strengthen Australia’s financial counselling sector.”
Louise Sylvan, who is the former deputy chair of the ACCC, was appointed to lead the review earlier this year, after the Royal Commission (into Misconduct in the Banking, Superannuation and Financial Services Industry) highlighted widespread unethical and criminal behaviour in financial counselling sector.  
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Banks to step up after review into financial counselling sector

<html><body>
GUEST OBSERVATION
Will the banking services royal commission have a lasting effect of improving the banking and financial sector? The answer is “no”. A temporary change is apparent, but the problems lie deeper than those <a href="https://theconversation.com/banking-royal-commission-no-commissions-no-exemptions-no-fees-without-permission-hayne-gets-the-government-to-do-a-u-turn-110974" target="_blank">addressed by the royal commissioner</a>.
The worldwide pervasiveness of financial sector misconduct is an indication.
This is not a criticism of the Royal Commission as such. It had a limited mandate and limited time, although its approach of focusing on Australian case studies further limited its scope. And a broader investigation of economic and social underpinnings of financial sector misconduct would have required a different sort of Inquiry.
It’ll be hard to act on the report we had
Even then, any recommendations for fundamental changes to financial sector structure and activities needed to inhibit misbehaviour would have to run the gauntlet of gaining political support in the face of vested interests.
The response to, and government capitulation on, the Hayne recommendation regarding <a href="https://theconversation.com/sam-and-the-honest-broker-why-commissioner-hayne-wants-mortgage-brokers-to-charge-fees-114071" target="_blank">mortgage broking fees</a> starkly illustrates the point.
Why will the recommendations not be a lasting solution? An important reason is that the royal commission interpreted “behaviour consistent with community standards” in a limited way to refer to situations in which customers were actually harmed.
But much of community angst over financial sector conduct relates to the broader use of market power and superior knowledge to extract an “unfair” share of the benefits from transactions with customers.
And it missed the broader problem…
Customers don’t get a fair share of the benefits from transactions, competition doesn’t work to make sure they do, and customers are often unaware that they have been exploited.
Why is it happening? The answer lies partly in this comment of Royal Commissioner Kenneth Hayne on page 54 of his <a href="https://financialservices.royalcommission.gov.au/Pages/reports.aspx#interim" target="_blank">interim report</a>: "Much if not all of the conduct identified in the first round of hearings can be traced to entities preferring pursuit of profit to pursuit of any other purpose"
Economists will rightly argue that there is nothing inherently wrong with the pursuit of profit or self-interest. It facilitates the efficient allocation of resources.
But unless it is accompanied by a concern with fairness (“do unto others as you would have them do unto you”) in situations of market power and superior information, as typically occurs in financial markets, it will lead to vulnerable consumers being exploited.
…which is a grey zone of unfairness
There is a large and poorly defined grey area between self-interested but clearly fair behaviour and self-interested unfair behaviour, which, in turn, merges into misconduct and illegal activity.
It is difficult for (particularly large) institutions operating in that grey area, even if committed to “fairness”, to ensure their employees do not slide towards the boundary. Or over it.
Moreover, competition between financial institutions in search of profits can lead to a “race to the bottom” in terms of lower financial product quality. This is not always apparent to some (or many) consumers – at their expense.
The financial sector particularly vulnerable to this problem.
First, many financial products and services are “<a href="https://www.investopedia.com/terms/c/credence-good.asp" target="_blank">credence goods</a>” where the consumer needs them but is unable to assess their real worth either before or after the purchase.
A perfect example is a visit to the doctor. Often the reason we are visiting the doctor is because we don’t know what’s wrong with us. It makes it necessarily difficult or impossible to tell whether the doctor is good at her job.
Bankers sharpen their claws on each other
Second, much of the activity in financial markets is about trading and making profits (supposedly using superior information and expertise) at the expense of the another party in those markets.
If it is “right” for that part of the entity that does that to make money at someone else’s expense, why is it wrong for the part of the entity that deals with consumers to do that?
Here’s how the Commission could have tackled these problems in order to achieve real, longer term benefits.
Yet we license them…
First, it could have considered whether giving financial institutions a valuable “social licence” to operate in important business areas under advantageous institutional structures should bring with it extra enforceable obligations.
It could have also considered whether, given the lack of misconduct found in the mutual and cooperative sector, banks and other financial institutions could be organised more like mutuals.
Second, it could have recommended changes that would have given stakeholders other than shareholders (such as depositors and employees) a greater say in running those organisations (perhaps at board level) and a say in shaping their culture.
…and we could change the way they’re run
Third, it could have recommended structural separation between the retail and wholesale arms of firms to reduce complexity and the risks of deficiencies in control systems.
Structural separation could have also reduced the risk that the culture of trading and position-taking, in which profits are made at the expense of another party, spilled over into other parts of the institution where it wasn’t wanted.
Finally, it could (and should) have concentrated more on consumer protection.
It is a much broader issue than deterring and penalising misconduct.
Until consumer financial literacy catches up with financial product innovation and complexity, there will continue to be a big “market for financial misconduct”.
Exhorting institutions to do no harm won’t take it away.
Kevin Davis, Professor of Finance, University of Melbourne
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/do-no-harm-isnt-enough-why-the-banking-royal-commission-will-ultimately-achieve-little-116076" target="_blank">original article</a>.
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Why the banking royal commission will ultimately achieve little

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The Australian Securities and Investments Commission (ASIC) has noted the decision by Premier Investments Limited (Premier) to write down the value of its casual wear brand name assets by $30 million in its financial report for the year ended 28 July 2018.
ASIC had raised concerns on the value of these assets in Premier’s financial report for the year ended 29 July 2017.
They had questioned the "reasonableness and supportability of royalty rate assumptions and sales growth forecasts used in testing the assets for impairment".
ASIC stated: "Premier has referred to the increasingly competitive retail landscape and structural changes impacting the apparel industry in Australia and New Zealand."
The impairment of non-financial assets remains a "focus area of ASIC’s financial reporting surveillance program".
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Premier Investments write down brand name assets

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The financial services Royal Commission seems set to have significant consequences for home borrowers, and the impact will hit a lot quicker than any interim or final report to the Federal Government.
It already seems likely Commissioner Kenneth Hayne will recommend sweeping changes to the home loan industry arising out of just the first few weeks' hearings.
He has uncovered dreadful lending practices by banks and mortgage brokers.
The worst was NAB employees in greater western Sydney accepting cash bribes over the counter in white envelopes to facilitate loans they knew were based on fake documents in order to collect bonuses.
The fraud and bribery came with the manipulation of a mortgage commission incentive program that incentivised gym owners, taxi drivers, hairdressers and sporting clubs who made money by referring customers to the bank.
Then there's the more prevalent, so-called liar loans, where mum and dad borrowers simply skirt around the reality of their income, expenses, debts and assets when filling in their successful loan applications without much checking by the banks.
"By and large customers are poor historians when it comes to identifying their outgoings," Commissioner Hayne drily noted.
The regulatory backdrop has been Wayne Byres, the chairman of the Australian Prudential Regulation Authority, moving over recent times to put the brakes on dubious lending.
Byres has sought to ensure that standards for property lending are prudent, particularly in what he viewed as an environment of heightened risk.
Given the Australian banking system's very high exposure to both the residential mortgage and commercial property markets, APRA's ultimate goal was to protect bank depositors, because it's their money that banks are lending.
You would expect as Commissioner Kenneth Hayne uncovers further misconduct or poor lending oversight, getting an honest home or investment loan will become a lot harder for borrowers.
And any reining in the bank's zealous willingness to lend will trigger the possibility of a Royal Commission-induced credit slowdown.
This could impact on interest rates.
According to Shane Oliver, chief economist at AMP Capital, tighter lending may have the effect of pushing the next interest rate rise back to 2020, rather than 2019.
"It seems a real risk around the issues of lax lending standards is that banks move to a far more rigorous assessment of applications for loans," Shane Oliver noted.
This was unlikely to cause a full-on credit crunch, Oliver forecasts, but more likely a slowing in credit growth.
UBS analysts have warned too there is a growing risk the RBA was under-estimating the downside risk from tightening lending standards.
“While a tightening of mortgage underwriting standards is prudent, it has a material impact on the economy,” UBS noted.
“It must be remembered that house prices are determined by the demand and supply of credit, not the demand for and supply of housing,” UBS advised.
This article first appeared in The Daily Telegraph.
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jchancellor-FAypfDUnLy

Financial Services Royal Commission to have big impact on home borrowers

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GUEST OBSERVER
A Productivity Commission report analysing competition in the financial sector has pointed out that our finance regulators have become enablers of an industry that is an impediment to our economic competitiveness and exploitative of their most loyal customers.
It proves the need for a board to oversee the conduct of our financial regulators, policing the bodies that are supposed to be keeping our financial system in check.
It could not have come at a worse time for our big four banks. Perennially pilloried for their rampant market misconduct (fraudulently manipulating benchmark interest rates) and their equally rampant abuse of upwards of hundreds of thousands of consumers across every one of their retail operations at one stage or another – financial advice, life insurance and credit card insurance, just to name a few.
The Australian Securities and Investments Commission (ASIC) most recently launched a bank-bill swap rate manipulation case against the Commonwealth Bank, but only across a very narrow range of infringements. The bulk of the infringements can’t be prosecuted because ASIC has dithered for so long, the statute of limitations has run out, and the alleged crimes have proscribed.
And what of our other financial regulator - the Australian Prudential Regulation Authority (APRA)? The Productivity Commission reckons that APRA’s ham-fisted use of macro-prudential tools, usually used to reduce risk in our financial system, has benefited the big four banks to the tune of A$1 billion.
APRA has been criticised for pursuing stability in a manner that has killed competition, hurt consumers, and starved small businesses of life-giving capital. The dominance by a few banks, whose profits are based on runaway property prices, is its own systemic threat.
The result is that small banks are squeezed out, big banks raking in higher rates, and investors offsetting higher rates against their taxes and so costing the Australian Taxation Office an estimated A$500 million in deductions. As the old saying goes, when your only tool is a hammer, every problem looks like a nail.
Who will regulate the regulators?
So what to do about ASIC and APRA? Back in 2014, the Financial System Inquiry recommended a board of oversight – a regulator for the regulators – to ensure that the regulators discharge their mandates.
So, for example, to ensure that ASIC acts like a cop, not a co-op; that APRA acts with foresight and finesse, as opposed to damaging competition. APRA and ASIC pushed back at the time, and the Abbott government rejected the recommendation.
Now to add impetus to the Financial System Inquiry recommendation, the Productivity Commission says there is a lack of transparency and accountability exhibited by our regulators. Add to that the implications regarding regulator’s efficacy that comes with the establishment of the Financial Services Royal Commission. The public deserves better than this.
A regulator for the regulators – a Financial Regulator Assessment Board – would conduct ex post analyses of how regulators had discharged their mandates, evaluate their policies and the efficacy of their policy tools. It would be a sober second thought, and a crucial mechanism of double redundancy – to pick up on crucial elements that the regulator may have overlooked.
The idea has form. The British have created something similar, called a Financial Policy Committee, this body’s aim is to review the British regulators, while keeping a look-out for where the next “bombshell” may come from.
That development in turn builds on the work of James Barth, Gerard Caprio and Ross Levine whose research indicates that regulators simply cannot be trusted to perform these crucial functions as the guardians of finance, without oversight. The researchers call their proposed board of oversight the “Sentinel”, and point out that no industry is more adept and more practised at suborning the guardians of finance than banks and insurers. Sound familiar?
<img src="https://counter.theconversation.com/content/91396/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1">Australia’s financial system is increasingly governed by a lawless financial sector, presided over by regulators that are at best misguided, and at worst captured. A board of oversight is the least we can do.
Andrew Schmulow, Senior Lecturer, Faculty of Law, University of Western Australia
This article was originally published on <a href="http://theconversation.com" target="_blank">The Conversation</a>. Read the <a href="https://theconversation.com/australias-financial-regulators-need-policing-91396" target="_blank">original article</a>.
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Australia's financial regulators need policing: Andrew Schmulow

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The number of houses being passed in at auctions and the easy availability of inner-city apartments is not just the result of regulatory measures, but also a loss of confidence stemming from the extremely tight bank lending rules.
Columnist Robert Gottliebsen labels it as the “tea, coffee and cosmetics” (TCC) approach to home lending in his recent piece in The Australian.
While attempting to explain the confusion among many young real estate agents about the number of houses passed in and the desperation of apartment developers to sell, Gottliebsen says there are many reasons, but “none so powerful and potent in what is happening in the lower management levels of some of the big banks”.
He says it’s conventional to blame the APRA and the regulators for the credit squeeze but the problem is “multiplied by a middle management loss of confidence stemming from the looming retrenchments and the bank scandals”.
This has forced the banks to be more restrictive, especially the ones facing scandals such as the Commonwealth Bank.
TCC has even spread to small business lending, writes Gottliebsen.
He says borrowers are shocked that the new tests by banks had slashed the amount they would lend by a quarter and even a third. 
Borrowers are being asked for information about basic living expenses, such as clothing, footwear, cosmetics, dining out, after-hours school care, dining out to name a few.
Gottliebsen states that this banking approach, which he has spoken of earlier, if it continues will see more serious falls in the prices of dwellings, widening the 10% fall in Sydney apartments to other areas of the residential market, including Melbourne.
This is already the case in inner city markets of Sydney, Melbourne and Brisbane now, which also have many unsold houses now.
He says the “crackdown is much wider than TCC and covers restrictions on interest-only loans, higher interest rates for investors, threats of higher interest rates, no money for Chinese borrowers” and so on.
Also, the rising gas and electricity bills further hit confidence.
“The trouble with these uncoordinated attacks is that they start with the aim of stopping a boom, which threatened to turn into a bubble collapse.”
According to Gottliebsen, this activity looks very little on the surface initially and as the squeeze continues, it hurts confidence.
“We are not there yet but once it happens — and the illogical approach of TCC lending will bring it on — confidence will take a long while to restore.
“And it spreads to small business.”
But the banks’ reluctance has opened up opportunity for non-bank lenders, which are seizing the opportunity.
The “regulators’ response is to clamp down on filling the bank-created void, so damaging the nation”.
In conclusion, Gottliebsen suggests that a banking royal commission is not a “good idea at this time”, but if there is one, it should cover regulators too.
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jonathanchancellor-7SQnKwU6yx

Borrowers face shock when banks slash home loan approvals by at least a quarter: Gottliebsen 

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Australian Prudential Regulation Authority chairman Wayne Byres has said the “community trust and confidence was an important consideration” behind its recent inquiry into money laundering involving the Commonwealth Bank.
He said the CBA has experienced a number of incidents over recent years that have damaged its reputation.
“After the AUSTRAC matter came to light, it was difficult to see how the bank could quickly remedy the situation by itself,” he said.
The APRA chairman’s statement came during his opening statement to the House of Representatives Standing Committee on Economics.
Byres said the inquiry is expected to reaffirm to the larger public of that regulators were working on addressing irregularities and would send a signal to other lenders as well.
“In that sense, we very much see the Inquiry as making a constructive contribution to strengthening the reputation and public standing of the bank,” he said.
“As an added benefit, any issues identified will provide useful learnings to others in the industry.”
He also said that the the risks in the housing market that were pointed out in APRA’s 2015/16 Annual Report still hold.
“We called out risks in the housing market, the funding profile of the banking system, poor experience in some segments of the insurance industry, and the need to enhance governance and transparency in the superannuation industry. These issues remain prominent today,” said Byres.
Although he said that at a macro level, Australia continues to benefit from a sound financial system that reflects a long period of economic growth and resilience in financial institutions. 
However, there was no room for complacency.
Byres also used the opening remarks to update the committee on APRA’s response to the recommendations from the Committee’s Review of the Four Major Banks.
One of the recommendations was for a review of the licensing requirements for Authorised Deposit-taking Institutions (ADIs) and there were several others designed to strengthen accountability and transparency of financial institutions.
The Banking Executive Accountability Regime (known as the BEAR), will increase APRA's powers, that among other things, include fines to be imposed on errant ADIs.
He said the core objective of the BEAR was "establishing clearer accountabilities for, and expected standards of behaviour by, senior executives within banks" and was being constructed in a manner that is consistent with APRA’s prudential mandate.
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APRA chairman says CBA inquiry will establish public trust

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Jana Jaros and Jackson Laurence Malcolm Capper have appeared in the Southport Magistrates Court on charges of operating an unlicensed financial services business following an ASIC investigation.
ASIC documents state Ms Jaros and Mr Capper have been charged under section 911A of the Corporations Act for allegedly aiding and abetting Astra Group Pty Ltd and Old Cambridge Pty Ltd to carry on a financial services business without holding an Australian Financial Services licence.
They also face two charges each under section 1308(2) of the Corporations Act for lodging with ASIC documents containing false or misleading material.
Providing assistance to operate an unlicensed financial services business carries a potential maximum penalty of $36,000 or two years' imprisonment or both, while providing false or misleading documents carries a maximum penalty of $36,000 or five years' imprisonment or both.
This matter is being prosecuted by the Commonwealth Director of Public Prosecutions.
Ms Jaros and Mr Capper appeared on 7 August 2017. The matter was adjourned until 4 September 2017.
Background
ASIC alleges that Ms Jaros and Mr Caper set up the websites www.investradirect.com and later www.investradirect.co to attract and service clients of Astra Group Pty Ltd and Old Cambridge Pty Ltd.
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