Brisbane-based <a href="https://www.apartments.com.au/developers/red-co">Red &amp; Co Developments</a> has officially launched its $250million COMO apartment development in Varsity Lakes, while simultaneously commencing construction.&nbsp;

Building work is now underway at COMO following the appointment of <a href="https://www.apartments.com.au/builders/5point-projects">5Point Projects</a> as contractor to deliver the boutique development which will rise on a 2857 sqm site overlooking Lake Orr at 22 Lake Street.

When completed, <a href="https://www.apartments.com.au/new-apartments/como-varsity-lakes-22-lake-street-varsity-lakes-qld-4227">COMO</a> will comprise 156 apartments across 16 levels located in the heart of Varsity Lakes.

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The project, which will sit alongside Bond University, will deliver a diverse array of apartment designs comprising one-, two- and three-bedroom residences that have already attracted interest from local and interstate investors as well as an array of owner occupiers looking to gain a foothold in the precinct.

Red &amp; Co, which has largely focused on the Brisbane market in recent years where it has delivered more than 500 apartments and townhouses across 26 projects, has designed COMO to combine tranquil, lakeside living with the vibrant urban convenience of the vibrant Varsity Lakes village.

“We’re thrilled to announce a start to construction of COMO in conjunction with the official launch of the project, our first for the Gold Coast,” said Red &amp; Co Director and Co-Founder David Laverty.

[smartcode_project:default project_id=135546 project_image_fid=363509]

“COMO is superbly positioned to capture the essence of the Varsity Lakes village lifestyle and its thriving café and dining precinct, while delivering a much-needed diverse supply of premium residences for the local market.

“Pre-launch inquiries have been strong among both local and interstate investors and owner-occupiers, including downsizers and upgraders who appreciate the value proposition that COMO represents.”

Prices at COMO start from $1,000,050.

[smartcode_project:default project_id=135546 project_image_fid=363511]

Designed by <a href="https://www.apartments.com.au/architects/bda-architecture">BDA Architecture</a>, the COMO development incorporates an extensive range of amenities for residents including a 25-metre rooftop lap pool, sundeck, barbecue and dining areas, as well as multiple rooftop pickleball and paddleball courts, a wellness and activity centre, gym, sauna, plunge baths and landscaped gardens.

“COMO presents a rare opportunity to secure a stylish, lifestyle-focused home in one of the Gold Coast’s most sought-after neighbourhoods,” added Laverty.

“The rooftop will be the epicentre of fun for residents with an array of amenities for residents that are quite unique for a boutique project such as this, all while offering spectacular vistas across the Gold Coast as far north as Southport and south to Burleigh.”

[smartcode_project:default project_id=135546 project_image_fid=363514]

&nbsp;

Red &amp; Co has chosen the Varsity Lakes site for its proximity to top-tier schools, major shopping hubs, such as Robina Town Centre and its CBD offering, as well as key Gold Coast transport links, including Varsity Lakes Train Station.

COMO will be located just a short walk to shops, cafes and restaurants in Varsity Lakes and just a 10-minute drive to the Burleigh Heads beachfront.

With construction currently underway, Red &amp; Co anticipates COMO will be completed in 2028.

[smartcode_project_cta:default project_id=135546]

Joel Robinson

Red & Co to launch debut Gold Coast development Como Varsity Lakes as construction commences

Longstanding Gold Coast developer Raptis has acquired a prime development site on Surf Parade for its next Broadbeach apartment project.

Progressing towards completion of <a href="https://www.apartments.com.au/new-apartments/the-sterling-broadbeach-6-8-george-avenue-broadbeach-qld-4218">The Sterling Broadbeach</a>, 90 apartments on nearby George Avenue, <a href="https://www.apartments.com.au/developers/raptis">Raptis</a>, led by second-generation family man Evan Raptis, has picked up a block on the corner of Surf Parade and First Avenue.

The site had been earmarked for a luxury apartment project with 33 full-floor apartments across a 37-storey tower. Raptis will go back to the drawing board and create a building more appropriate for the site. The development application will be lodged later this month.

Evan Raptis told Apartments.com.au the site ticks all the boxes.

"Broadbeach is a suburb we've developed several buildings over the years. Surf Parade ticks all the boxes for the type of apartment development we want to deliver."

Raptis had several pre-lodgement meetings with council to ensure they are aligned in the development.

<img alt="Raptis" data-entity-type="file" data-entity-uuid="f0d58573-07a4-47a8-9f5e-fbf35fb03dc3" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-03-05%20at%204.58.23%E2%80%AFPM.png?VersionId=iczZEd_4_o4UL0PHMPJGfy_q3tv96J5i" />

Surf Parade has emerged in recent years as one of the most popular streets in Broadbeach for development.

South East Queensland developer Mosaic Property Group kicked it off with Marella by Mosaic. Bassar Group sold out Infinity on the street, while for its&nbsp;first Gold Coast development, Polycell grabbed a Surf Parade site for <a href="https://www.apartments.com.au/new-apartments/the-rochester-broadbeach-143-surf-parade-broadbeach-qld-4218">The Rochester</a>, which is nearly sold out.

Melbourne-based developer Hirsch &amp; Faigen recently launched its fourth Gold Coast project on the exclusive strip. The Eveleigh Broadbeach will have 100 apartments across a 31-storey building designed by Rothelowman.

GV Property Group site development specialists Antonio Mercuri and Luke Reaby, who both amalgamate sites and sell shovel-ready sites to developers up and down the Gold Coast, sold Surf Parade to Raptis.

Raptis secures prime Surf Parade site for next Broadbeach apartment development

Less than two years after breaking ground, Gardner Vaughan Group is celebrating the topping out of Bask, its second development in the exclusive coastal enclave of Bokarina on Queensland’s Sunshine Coast.&nbsp;

Located only minutes from the beachfront, the two seven-storey luxury apartment towers, known individually as Mydas and Caretta, offer a selection of one-to-four-bedroom residences with views of Lake Kawana, the Glasshouse Mountains, and Bokarina Beach.&nbsp;

[smartcode_project:default project_id=141609 project_image_fid=333359]

Gardner Vaughan Group Commercial Director Sam Gardner said the milestone marks the home stretch for construction, with first residents expected to be able to move in from Spring 2026.&nbsp;

“This is a significant milestone in bringing this development to life and represents our confidence in this region’s long-term growth and appeal,” Gardner said.&nbsp;

“With 85 per cent of apartments already sold, buyers are joining an established, coastal village that offers the very best of the Sunshine Coast – seasonally patrolled surf beaches, renowned restaurants, and links to established health and retail.&nbsp;

“The final collection of three- and four- bedroom apartments range in size from 127sqm to 300sqm, each with two or three secure car parks and storage, and with construction fast approaching completion we don’t expect the last few apartments to remain on the market for long.”&nbsp;

[smartcode_project:default project_id=141609 project_image_fid=333362]

Local restaurateur Luke Stringer, who co-owns and manages the award-winning Bocca Italian and Playa Mexican restaurants in Bokarina, has lived in the beachside suburb for 18 months and worked there for more than three years, and said the beachside suburb was thriving.&nbsp;

“It’s fair to say Bokarina is finally stepping into the sun and there’s a lot to love about the place,"&nbsp;Stringer said.

"It’s such a great community, where you see the same smiling faces every morning and everything’s within easy reach – it’s the perfect hub in the middle of the Sunshine Coast.

“When we first opened Bocca Italian, we were the lone restaurant, but it’s been amazing to see how the area has grown. The more venues that open, the busier it gets for everyone. When Playa Mexican opened its first Saturday night, Bocca had a record night and Playa was packed too, which blew us away how everyone is thriving.&nbsp;

“There’s a great energy around the place now, and people are really embracing Bokarina as a food and lifestyle destination.”&nbsp;

[smartcode_project:default project_id=141609 project_image_fid=363368]

Stringer joined other buyers at Bask Bokarina and the Gardner Vaughan Group team to celebrate the topping out at a special event in February.&nbsp;

Located in Kawana Waters, midway between Caloundra and Maroochydore, Bokarina locals enjoy scenic walking paths around Lake Kawana, playgrounds, beachfront boardwalk and parklands, alongside all the convenience of a masterplanned beachside community.&nbsp;

“You see people jogging or swimming in the morning, then grabbing coffee at the cafes, people are really embracing the area and all this growth is bringing more people to Bokarina,” Stringer added.&nbsp;

To take advantage of the vistas, each of the 135 apartments at Bask is designed with full size windows and high ceilings that provide an abundance of natural light.&nbsp;

Prices for the remaining three-bedroom apartments start at $1,599,000 and four-bedroom apartments start at $3,149,000.&nbsp;

[smartcode_project:default project_id=141609 project_image_fid=363369]

The mixed-use development also features ground-level retail space for cafés, dining options and boutiques, including the soon-to-be-opened ‘Corner Shop’, by the team behind Noosa’s well known ‘Organika’.

Sam Gardner said Gardner Vaughan Group’s 37-year history building and developing across South East Queensland has contributed to the success of its second development in Bokarina, which follows the recently completed Zinc Apartments.&nbsp;

“We care how people live and this is reflected in the way we approach the design and delivery of every development,” he said. “Furthermore, as a builder-developer we have full control over the construction program and our 100 per cent completion rate is something people can draw confidence from.”&nbsp;

Founded by civil engineers Guy Gardner and Darryl Vaughan in 1989, the family-owned business has evolved from a consultancy firm to an award-winning builder-developer, with projects across the Sunshine Coast, Moreton Bay, Brisbane and the Gold Coast.

[smartcode_project_cta:default project_id=141609]

Gardner Vaughan Group tops out Bask Bokarina apartments

Prolific Melbourne developer <a href="https://www.apartments.com.au/developers/hirsch-faigen">Hirsch &amp; Faigen</a> has launched its fourth new Gold Coast development in as many years.

<a href="https://www.apartments.com.au/developers/hirsch-faigen">Hirsch &amp; Faigen</a>, led by Daniel Faigen and backed by Eddie Hirsch, co-founder of United Petroleum, has unveiled The Eveleigh, on a prime 1,100 sqm site at 7-9 Surf Parade in the heart of Broadbeach.

<a href="https://www.apartments.com.au/new-apartments/the-eveleigh-broadbeach-7-9-surf-parade-broadbeach-qld-4218">The Eveleigh</a> will deliver 100 apartments across 31 levels, making it the company’s largest Gold Coast project to date. It builds on the success of its three earlier developments, <a href="https://www.apartments.com.au/buildings/hemingway-1267-1273-gold-coast-highway-palm-beach">The Hemingway in Palm Beach</a> and <a href="https://www.apartments.com.au/buildings/emerson-kirra-100-musgrave-street-coolangatta">The Emerson at Kirra</a>, both completed, and <a href="https://www.apartments.com.au/new-apartments/yves-mermaid-beach-7-9-mermaid-avenue-mermaid-beach">Yves Mermaid Beach</a>, which is nearing completion.

[smartcode_project:default project_id=149670 project_image_fid=360966]

The announcement of The Eveleigh affirms the company’s sustained confidence in the Gold Coast market which continues to remain undersupplied. It also increases the value of Hirsch &amp; Fa​igen’s Gold Coast development portfolio to more than $700 million since the company first entered the market in 2021 with Hemingway.

The company has enlisted its preferred architecture firm Rothelowman to design The Eveleigh, which will offer a thoughtfully curated lifestyle, including a substantial wellness precinct, communal recreation areas, children’s play spaces, work-from-home facilities, and shared lounge and dining areas.

[smartcode_project:default project_id=149670 project_image_fid=360965]

Designed for the prime market demographic of downsizers and interstate lifestyle investors in mind, The Eveleigh has been crafted to offer an increasingly rare blend of affordable luxury in a tightly held market. Uniquely positioned in the heart of the Gold Coast’s most sought-after lifestyle suburb of Broadbeach, the project will also boast uninterrupted beach and hinterland views.

The Surf Parade site is just a short walk to the bustling Broadbeach dining and retail precinct, Pacific Fair, The Star Gold Coast and convention centre, and an easy stroll to Kurrawa Beach and the recreational amenity of Pratten Park on the Broadbeach foreshore.

[smartcode_project:default project_id=149670 project_image_fid=360975]

“We’re excited to be proceeding with our fourth project on the Gold Coast in what is certain to become the new luxury precinct in Broadbeach,” says Anthony Bueti, the CFO of Hirsch &amp;a​mp; Faigen and a shareholder of the group.

“With the likes of Mosa​ic and Abedian &amp;a​mp; Co also launching quality projects in the area, the transformation will cement Broadbeach as the premier lifestyle and amenity suburb on the Gold Coast.

"After four years in the Gold Coast market, and with three successful projects completed, The Eveleigh is the product of everything we have learned to love about the Gold Coast and it will be an incredible addition to our growing portfolio in one of the most vibrant property markets in the country. We continue to remain very confident in the high-end Gold Coast property market.”

Urban Activation Director Matt George is handling sales for The Eveleigh, having sold out The Emerson, The Hemingway, and Yves, all before construction was completed.

Melbourne builder MAXCON has already commenced construction on The Eveleigh. They are forecasting a mid-2028 completion.

[smartcode_project_cta:default project_id=149670]

Hirsch & Faigen unveils The Eveleigh in Broadbeach

Two years after securing development approval for the final stage of its award-winning Thornton Precinct on the doorstep of Penrith Station, Urban Property Group is set to launch <a href="https://www.apartments.com.au/new-apartments/mayfair-on-penrith-172-lord-sheffield-circuit-penrith-nsw-2750">Mayfair on Penrith</a>, around 400 apartments designed to reflect two of Sydney’s most iconic structures.

The builder-developer has continued refining the design plans for the two-building development on a significant 8,280 sqm site on Sheffield Circuit, recognising the importance of the prime parcel as one of the closest developable sites to the station.

UPG enlisted architecture firm SJB to design the project. The team said they drew inspiration from both the General Post Office in Martin Place and East Circular Quay to help shape the design. The two-level colonnade, in particular, reflects the famous GPO building, which dates back to the 1860s.

[smartcode_project:default project_id=136726 project_image_fid=362014]

There will be one-, two-, and three-bedroom apartments on offer, with interiors by Cox Architecture. Residences will sit above a retail podium featuring hospitality and lifestyle operators such as One Playground and Volcano’s Steakhouse, contributing to an activated ground plane within the broader Thornton precinct.

A communal rooftop with a pool and views towards the Blue Mountains will provide shared open space for residents. The development is positioned between Ron Mulock Oval and Westfield Penrith, with the Nepean River and Great River Walk also nearby, placing daily amenity and green space within walking distance.

&nbsp;

[smartcode_project:default project_id=136726 project_image_fid=362015]

Mayfair is being delivered by Urban Property Group, a family-owned developer and builder with nearly 40 years’ experience across Sydney. The project will be the first in Penrith to be offered with Resilience Insurance’s 10-year Latent Defects Insurance (LDI) policy, which Urban Property Group has adopted across a number of its recent developments. The developer also has a 4.5-star iCIRT rating, one of the best ratings in market providing further confidence to buyers.

Urban Property Group CEO Patrick Elias said providing additional assurance to off-the-plan buyers has become increasingly important.

“Anything we can do to give confidence in our product is a plus,” Elias told Apartments.com.au.

“Consumers are a lot more weary and a lot more concerned in buying off the plan than they ever have been. They’re making their single large investment, which is their home, and providing confidence is something that we feel is paramount.”

[smartcode_project:default project_id=136726 project_image_fid=362020]

The LDI policy provides a 10-year warranty covering structural defects, with independent inspections carried out during construction and protection for owners if defects arise post-completion.

Mayfair represents Urban Property Group’s sixth and final development within Thornton, consolidating the masterplanned precinct immediately east of the station.

The developer, which builds its own projects, has already commenced construction. SRM Residential is handling the sales campaign.

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Urban Property Group to close the curtain on award-winning Thornton precinct with Mayfair on Penrith release

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I was reading a piece this week at MacroBusiness where it was pointed out that it has been 24 years since we went through the global recession.
Then eight years later we went into the Tech Wreck, then  eight years after that we hit the Global Financial Crisis (GFC) and now  eight years on we have hit Brexit – or as Australians will soon call it Bex – it (as it will probably cause some major headaches.)
Whilst Australia continues to post some very positive data, we need to pay closer attention to the data post June 30 as we now enter a period of uncertainty. Having said that, this should also be viewed as an exciting time as it is now clear that every eight years businesses need to adapt and recalibrate in order to survive.
One statistic we can’t hide from when the GFC hit in 2007 is that debt has grown much faster than GDP in every country. Some may say that this is an economic consequence as globally cash rates have been crashing down where in Australia we sit at a record low 1.75 per cent. Furthermore, many commentators are now stating that the cash rate in Australia will come down even more as a direct result of Brexit.
Whenever an economy reaches that financial standoff, and investors hate uncertainty, we need to be overly protective of investors as they are a particular and crucial economy driver. So there needs to be closer scrutiny as to why the ALP want to change the Negative Gearing goal posts, which will definitely drive up rents, and why the NSW Government wants to drive foreign investors from our property markets with their 4 per cent surcharge plus a 0.75 per cent land tax surcharge on residential real estate only.
Makes one seriously question exactly where governments expect the new buyers to evolve from? The real estate industry is hearing foreign investors are moving away from our markets in droves. Once again we need to be mindful of Brexit and life and results after June 30. Australia is now all but guaranteed that lending will now tighten, which is a good thing, however if we cast our minds back to the GFC we kept hearing two words – “green shoots”.
The sad part about emerging “green shoots” is that governments immediately see them as a new form of taxation – this in turn will bring about market stagnation which is the last thing our economy needs.
Having said that, existing property markets, otherwise known as the established household markets, are now 60 per cent down when compared to property listings two years ago. This is good news for established houses – we are now seeing record low listings which only strengthens the markets. For example, when I go back five years for Mosman houses you will see the pattern that has emerged.
<ul>
<li>30 June 2011 – 97 houses on the market in Mosman</li>
<li>30 June 2012 – 80 houses on the market in Mosman</li>
<li>30 June 2013 – 68 houses on the market in Mosman</li>
<li>30 June 2014 – 63 houses on the market in Mosman</li>
<li>30 June 2015 – 43 houses on the market in Mosman</li>
<li>30 June 2016 – 42 houses on the market in Mosman</li>
</ul>
What this tells us, and we should point out that these results are reflective across Sydney, is that since the GFC homeowners are taking advantage of record low cash rates by paying down debt faster. On the flip side they are renovating over selling as they see no economies of scale in donating a few hundred thousand dollars to our NSW Government in the form of Stamp Duty. In other words, the Stamp Duty component is then redirected to home renovations.
The NSW Government will recognise very quickly that it has a cash flow problem when the effect of the new surcharge stamp duty and the already declining established markets see the property market transactions coming to an abrupt halt. Don’t be surprised to see a total back-flip with the foreign buyer surcharges but not the land tax.
As for the established household markets the NSW Government should look at the amount of stamp duty previously paid on the past acquisition and give that household a 33 per cent deduction from the next stamp duty so long as that household has been in that property between five and ten years.
In business you offer incentives – it’s a shame governments struggle with the concept of that word.
<h5>MOSMAN – 2088</h5>
Number of houses on the market this time last year – 36
Number of houses on the market last week – 48
Number of houses on the market this week – 42
Number of apartments on the market this time last year – 33
Number of apartments on the market last week – 41
Number of apartments on the market this week – 33
<h5>CREMORNE – 2090</h5>
Number of houses on the market this time last year – 3
Number of houses on the market last week – 11
Number of houses on the market this week – 7
Number of apartments on the market this time last year – 16
Number of apartments on the market last week – 18
Number of apartments on the market this week – 17
<h5>NEUTRAL BAY – 2089</h5>
Number of houses on the market this time last year – 2
Number of houses on the market last week – 10
Number of houses on the market this week – 10
Number of apartments on the market this time last year – 39
Number of apartments on the market last week – 22
Number of apartments on the market this week – 23
ROBERT SIMEON is a director of <a href="https://www.rwm.com.au/" target="_blank" title="RWM" rel="nofollow">Richardson Wrench Mosman and Neutral Bay</a> and has been selling residential real estate in Sydney since 1985. 
He has also been writing real estate blog <a href="https://www.rwm.com.au/news/" target="_blank" title="Virtual Realty News" rel="nofollow">Virtual Realty News</a> since 2000.
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robertsimeon-hRNTwJyXkQ

Time for governments to roll out incentives: Robert Simeon

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EXPERT OBSERVER
The Australian economy is tepid, with consumer spending the weakest in ten years, business investment shrinking, and economic growth too weak to cover population growth.
Were it not for very strong growth in export income and the biggest surge in government spending in 15 years, the economy would have shrunk.
The Treasury believes the Australian economy is capable of growing at a sustained annual pace of <a href="https://www.smh.com.au/business/the-economy/myefo-treasury-downgrades-its-budget-projections-20151124-gl6mfd" target="_blank">2.75%</a>. The growth rate in the past financial year of <a href="https://www.propertyobserver.com.au/https://www.abs.gov.au/ausstats/abs@.nsf/mf/5206.0" target="_blank">1.4%</a> reported on Wednesday is only half that.
Not since September 2009 has the gap between what the Australian economy is capable of and what it has been delivering been so wide. 2009 was the year of the global financial crisis.
Real GDP growth
<a href="https://images.theconversation.com/files/290848/original/file-20190904-175710-w8sxqs.JPG?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/290848/original/file-20190904-175710-w8sxqs.JPG?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a> Commonwealth Treasury
<hr>
Economic growth has rarely been as low as 1.4% outside of a recession.
When account is taken of population growth, income and production per citizen went backwards. The last time that happened was during the financial crisis. The last time before that was during the early 1990s recession.
Household spending, which accounts for more than half of total spending, also failed to keep pace with population growth. The inflation-adjusted growth rate of 1.4% was also the lowest since the financial crisis.
<hr>
Growth in household consumption
<a href="https://images.theconversation.com/files/290854/original/file-20190904-175682-1td1jy.JPG?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/290854/original/file-20190904-175682-1td1jy.JPG?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a> Commonwealth Treasury
<hr>
Other figures released on Tuesday show retail spending dipped a further 0.1% in July.
Hardest hit in the 2018-19 financial year was spending on cars. Updated figures released at the same time as the national accounts show sales of new cars down 10% over the year to August.
Treasurer Josh Frydenberg said he preferred to think that households were delaying rather than abandoning purchases of cars, waiting until the economic outlook was clearer.
<hr>
Growth in consumption by category
<a href="https://images.theconversation.com/files/290863/original/file-20190904-175710-1vl9blt.JPG?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/290863/original/file-20190904-175710-1vl9blt.JPG?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a> June quarter 2019. Note: Discretionary consumption is as classified by Treasury. Commonwealth Treasury
<hr>
Weighing on consumers is an extended period of unusually low wage growth that the national accounts show has brought the share of national income paid out as wages down to just about its lowest point since 1964.
Although the wage and superannuation bill increased, climbing 5% over the year as employment grew, the share of national income paid out as wages and super fell to 52% – the lowest since the global financial crisis, and before that the lowest since the <a href="https://www.smh.com.au/entertainment/the-beatles-let-it-be-in-australia-1964-20140606-zrvui" target="_blank">Beatles toured Australia</a> and Donald Horne published <a href="https://www.penguin.com.au/books/the-lucky-country-9781742531571" target="_blank">The Lucky Country</a>.
<hr>
<a href="https://images.theconversation.com/files/290879/original/file-20190904-175705-mnrpnw.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/290879/original/file-20190904-175705-mnrpnw.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a> <a class="source" href="https://www.abs.gov.au/AUSSTATS/abs@.nsf/DetailsPage/5206.0Jun%202019?OpenDocument">ABS 5206.0, Table 35</a>
<hr>
Also weighing on consumers has been housing. Investment in housing (including alterations and additions) was down 9.1% over the year. Business investment fell 10%.
Company profits grew 12.8%, but leaving aside mining companies, whose profits grew strongly on the back of higher prices and export volumes, other profits grew only weakly, climbing 1.8%.
Mining income pushed up nominal GDP (the raw dollars unadjusted for prices that drive nominal incomes) up a healthy 5.4%, probably delivering the government a budget surplus one year earlier than promised, in 2018-19. Frydenberg said he already knew the result and would unveil it in a fortnight. His smiles suggested it’s one he likes.
<hr>
Nominal GDP growth
<a href="https://images.theconversation.com/files/290883/original/file-20190904-175678-1e6pzpc.JPG?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/290883/original/file-20190904-175678-1e6pzpc.JPG?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a> Commonwealth Treasury
<hr>
Mining income also pushed up what the Reserve Bank regards as the best measure of actual living standards, which (perhaps surprisingly) is not GDP per capita, which is going backwards, but a lesser known and purpose-designed measure known as “real net disposable income per capita”. It grew a healthy 2.65% over the year and a very healthy 1% over the quarter.
It is true that much of it was paid out in mining profits, but it is also true that it isn’t necessarily right to latch on to the cruder measure of GDP per capita and say that living standards are going backwards.
Helping maintain living standards was a very healthy growth in government spending, the highest for some time – not government infrastructure spending, that actually fell over the year as some state projects wound up, but day-to-day spending on things such as the National Disability Insurance Scheme.
<hr>
<img src="https://images.theconversation.com/files/290908/original/file-20190904-175686-un189b.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""><a class="source" href="https://www.abs.gov.au/AUSSTATS/abs@.nsf/DetailsPage/5625.0Jun%202019?OpenDocument" target="_blank">ABS 5625.0, Table 2</a>
<hr>
Oddly, because of the way the national accounts work, economic growth was also helped by a slump in imports, down 2.8% over the year due largely to a slump in imports of consumer goods.
The economy is in a bad way. Aside from mining and government spending, the only real bright spot is employment growth, and as the Reserve Bank often points out, employment growth doesn’t tell us much about what’s going to happen.
It tends to lag everything else in the economy, by <a href="https://www.rba.gov.au/publications/smp/2019/may/pdf/domestic-economic-conditions.pdf" target="_blank">up to nine months</a>. By the time it turns down, other things already have.
<h2>Few clear ways out</h2>
Frydenberg doesn’t seem too worried. For now he is banking on the tax cuts and the interest rate cuts in June and July to lift investment and spending.
The treasurer has two Plan Bs. One is an aggressive investment allowance for business. He <a href="https://theconversation.com/back-yourself-treasurer-frydenberg-tells-business-but-its-not-that-simple-122397" target="_blank">spoke about introducing one</a> last week, but on Wednesday he indicated that he wasn’t planning to do so until next year’s May budget. If needed, he could bring the date forward.
The other is another Reserve Bank rate cut, most likely at the board’s meeting on Melbourne Cup Day, by which time it will have before it an updated set of inflation figures.
Frydenberg revealed on Wednesday that he is taking a close look at the government’s contract with the Reserve Bank, a <a href="https://rba.gov.au/monetary-policy/framework/stmt-conduct-mp-7-2016-09-19" target="_blank">formal written agreement</a> which is renewed after each election.
He has asked the Treasury to look at it to see whether it needs to be tightened to make the bank more responsive to the state of the economy. This would mean more boldly cutting or pushing up rates.
In Britain, if inflation is 1 percentage point above or below the Bank of England’s target, it has to write to the government to explain why.<img src="https://counter.theconversation.com/content/122942/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;">
<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/why-weve-the-weakest-economy-since-the-global-financial-crisis-with-few-clear-ways-out-122942" target="_blank">original article</a>.
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jrobinson-rf4aSBido9

Why we’ve the weakest economy since the global financial crisis, with few clear ways out

What have we learnt since the financial crisis? RBA's John Simon

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EXPERT OBSERVER
Wayne Swan and Kevin Rudd spent big and spent bold, and it almost certainly kept us out of recession. <a href="https://theconversation.com/profiles/richard-holden-118107"> </a>
A little more than a decade on from the the collapse of Lehman Brothers, the largest bankruptcy in history, many of the world’s advanced economies are only now beginning to recover fully.
I was on the faculty at the University of Chicago at the time and, like many, followed the events of the 2008 US summer with a combination of interest and outright fear.
It is hard to describe how scary the two months around the Lehman bankruptcy were. Two anecdotes convey some of that fear, however.
The first was when I spoke to an economics official in the Obama administration who said: “Go get cash and bottled water. Automatic teller machines might not be working two days from now.”
The second reflects just how severely money markets froze up. Goldman Sachs – Wall Street’s most venerable firm – was largely on the good side of trades on credit default swaps, the instruments behind much of the crisis. Yet its stock price was utterly hammered. It wasn’t until legendary investor Warren Buffett sank US$5 billion into Goldman that confidence was restored.
On one day Goldman stock was down by a staggering nearly 50% in intra-day trading. It very nearly went the way of Lehman – all because of what amounted to a modern-day bank run.
<img src="https://images.theconversation.com/files/236990/original/file-20180918-158246-1o295vy.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt="">Goldman &amp; Sachs stock price.
<hr>
The Obama administration responded with spending (including on tax rebates for households and firms), big interest rate cuts and measures to ensure banks had access to funds. Combined, these helped avoid a repeat of the Great Depression.
When Australia splashed cash
Australia, too, spent big: A$10 billion in October 2008 and a further A$42 billion in February 2009. More than half of the second sum, $A26 billion, went on infrastructure. Another $12.7 billion was spent on cash bonuses, including $900 for every Australian on less than $80,000.
And we cut interest rates, massively, and guaranteed bank deposits.
The International Monetary Fund, the Organisation for Economic Cooperation and Development, and most good economists think what we did was essential to ensure Australia avoided a severe downturn.
Prime Minister Kevin Rudd and his treasurer, Wayne Swan, deserve a lot of credit.
Yet there are those on the conservative side of politics who claim the stimulus spending was wasteful, not that helpful, and locked in an era of higher government spending.
Wasteful? Not really
As prime minister in 2016, Malcolm Turnbull encapsulated the view that the spending was a waste when he <a href="https://www.propertyobserver.com.au/http://www.abc.net.au/7.30/interview:-prime-minister-malcolm-turnbull/7542756" target="_blank">told the ABC’s Leigh Sales</a>: “I think what shepherded Australia through the GFC successfully was the Chinese stimulus and the large amount of cash that John Howard left in the bank.”
Here’s what I think.
The Chinese stimulus helped, but China didn’t do it to help Australia. It did it to help itself, with a happy byproduct being continued demand for Australian resources.
Does Mr Turnbull really think the Chinese government was either mistaken (because stimulus spending doesn’t help) or benevolent (because it wanted to help Australia)? These are not terms normally associated with Beijing.
The “large amount of cash” left by the Howard government was indeed very important. It allowed the Rudd government to spend big without running up huge government debt. As the noted UC Berkeley economists Christina and David Romer <a href="https://eml.berkeley.edu/%7Ecromer/Reprints/Crises%20and%20Policy/Romer&amp;RomerCrisesandPolicy.pdf" target="_blank">have pointed out</a>, using evidence from 24 advanced economies, fiscal and monetary policy “space” is important in ensuring the stimulus programs work.
So, yes, Howard’s debt-free budget was important, but only because it gave the government room to spend.
There is an important point here. Namely, that prudent fiscal management through ordinary times is essential in order to build up the firepower to respond in extraordinary times.
Australia still enjoys government debt to GDP that is low by OECD standards, but its growth has been very rapid even in post-crisis years because of the structural gap between government revenues and expenditures. Both sides of politics say they are committed to narrowing it. We shall see.
Space matters
“Space” to act with monetary policy (official interest rates) is also important.
It’s the basis for much of the talk about a “new monetary policy framework” that would lift interest rates from their present lows in Australia and overseas to around 5%. It’s a goal articulately and <a href="https://www.brookings.edu/research/why-the-fed-needs-a-new-monetary-policy-framework/" target="_blank">forcefully argued for by former US Treasury Secretary Larry Summers</a>. Getting there would give central banks the firepower they might need.
These lessons have been learned to varying degrees, but are now thankfully at least part of the mainstream debate.
And regulation
One thing that everyone should have learned from the financial crisis in general, and Lehman in particular, is the need for effective regulation of financial institutions.
The combination of massive leverage, opaque financial instruments and radical interconnectedness of financial firms in the US was a disaster waiting to happen.
In many ways it still could be.
Republicans in the US want to dramatically roll back the Dodd-Frank Wall Street Reform and Consumer Protection Act introduced by President Obama in response to the financial crisis.
Although far from perfect, it helped de-risk the US financial system.
In Australia the failings of financial regulators play out every day at the Hayne Royal Commission, in excruciating detail.
It entitles us to ask if Australian regulators can’t prevent outright theft by financial institutions, how equipped are they to prevent more complicated transactions that might put the financial system at risk?
The answer is: not very.
We’ve learned some things
A decade after Lehman it’s fair to say we have learned lessons.
We know how to use big and bold fiscal (spending) policy and monetary (interest rate) policy to create a virtuous circle of beliefs that can pull us out of a downturn.
And we know that we need to reload both fiscal and monetary policy in the good times so we are ready for the bad times.
But on financial regulation the US might be about to go backwards, and we never really went forwards.<img src="https://counter.theconversation.com/content/103514/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;">
Richard Holden is a Professor of Economics and PLuS Alliance Fellow, UNSW
This article is republished from <a href="http://theconversation.com" target="_blank">The Conversation</a> under a Creative Commons license. 
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rh-YsoTT2xMuQ

The GFC and me, ten years on, what have we learned? Richard Holden

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Martin North says 60 Minutes took the worst case from his four scenarios as the basis of the alarming segment which went to air last night on Channel 9.
"It is not my central scenario, rated only a 20 percent chance, as I made clear when interviewed," he said noting this caveat did not make it to the final cut.
North suggested a fall of 45 percent in home prices would be over three years or so, and require the US financial markets to react to rising US Fed rates.
Click here <a href="https://www.propertyobserver.com.au/images/2018/9/17/north-forecast.jpg" target="_blank">to enlarge.</a>
<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/2018/9/17/north-forecast.jpg" alt="">
"This creates a GFC 2.0." North, a finance sector analyst and principal Digital Finance Analytics, suggested.
The 60 Minutes reporter Tom Steinfort advised "several of the experts we interviewed for this story estimate it could be as much as 40 percent in Melbourne and Sydney, while even the most optimistic property analysts concede there will be a drop of at least 10-15 percent."
Steinfort says he's been spooked by the downturn, holding off his desired property purchase with fiancee Claudia Jukic.
His 60 Minutes report kicked off with a serious inaccuracy.
"For as long as most of us care to remember, or perhaps only as long as we want to remember, property prices in Australia have only gone in one direction, at least in our big cities," Steinfort claimed.
CoreLogic's Cameron Kusher recently wrote <a href="/expert-insights/buying/2018-housing-declines-hit-melbournes-inner-east-and-sydneys-hills-district-hardest-corelogic">a detailed research analysis tracking the current downturn</a> with three downturns since 2003.
North said the figures used in the program did not reflect his “central scenario” and that Channel Nine “chose not to cover” the more likely alternatives.
“My best call would be [property value falls] in the region of 15-20 per cent from top, over two to three years,” he said.
You can read North's full analysis <a href="http://digitalfinanceanalytics.com/blog/updated-finance-and-property-scenarios-summary-findings/" target="_blank">here</a>. 
 
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jchancellor-FAypfDUnLy

45 percent housing price collapse was least likely scenario: Martin North's 60 Minutes postscript

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GUET OBSERVER
It seems momentous things happen in years ending in seven.
Well, at least in the last 50 years starting with the “summer of love” in 1967 and the introduction of the Chevrolet Camaro.
But after that, it was downhill with Elvis leaving the building in 1977, the 1987 share market crash, the Asian crisis of 1997 and the GFC that started in 2007.
While Lehman Brothers didn’t go bankrupt until September 2008, the GFC’s initial tremors occurred in 2007.
Financial markets really started to take notice in August of that year, with shares taking a big hit before rebounding to new highs for US and Australian shares in October/November 2007 ahead of a roughly 55% decline into March 2009.
This note looks at the main lessons for investors from the GFC and whether it can happen again.
But first some history.
The GFC was the worst global financial crisis since the Great Depression.
It saw the freezing up of lending between banks, multiple financial institutions needing to be rescued, 50% plus share market falls and the worst post-war global economic contraction.
At the core of the GFC was something very basic.
In an environment of low interest rates (with often initially low “teaser” rates) too many loans were made to US homebuyers that set off a housing boom that went bust when interest rates rose and supply surged.
So no big deal – it happens all the time!
But it was what went on around it that ultimately saw it turn into a global crisis.
A massive proportion of the loans (40% or so) went to people who had no ability to service them – sub-prime and low doc borrowers.
Remember NINJA loans – loans to people who had no income, no job and no assets!
And many were non-recourse loans – so borrowers could just hand over the house if its value fell below the debt owed on it and that was the end of their liability.
Recall – jingle mail!
This was encouraged by public policy aimed at boosting home ownership and ending discrimination in lending.
It was made possible by a massive easing in lending standards facilitated by financial innovation that packaged up the sub-prime loans into securities, which were then given AAA ratings on the basis that while a small proportion of loans may default the risk will be offset by the broad exposure.
These securities were then leveraged up and sold all over the world with fancy names like Collateralised Debt Obligations (CDOs) that found willing buyers looking for decent low risk (remember AAA rated!) yield at a time of low interest rates.
Hedge funds investing in such products even got awards like “yield manager of the year”.
But the trouble was that with the sub-prime loans moved out of the banks, there was no “bank manager” looking after them.
This all came as banks globally were sourcing an increasing amount of the money they were lending from global money markets – which had freed them up from relying on expensive bank deposits via bricks and mortar branches.
The music stopped in 2006 when poor affordability, an oversupply of homes and 17 interest rates hikes from the Fed over two years saw US house prices peak and then start to slide.
This made it harder for sub-prime borrowers to refinance their loans at their initial “teaser” rates.
As a result, more and more borrowers defaulted causing investors in the fancy products that invested in sub-prime loans (like CDOs) to start suffering losses.
The problem really caught the attention of global investors in August 2007 after BNP froze redemptions from three of its funds because it couldn’t value the CDOs within them, which in turn set in train a credit crunch with sharp rises in the cost of funding for banks and a reduction in its availability triggering sharp falls in share markets.
Shares rebounded but only to peak in late October/November 2007 before commencing roughly 55% falls as the credit crunch worsened, the global economy fell into recession, mortgage defaults escalated and multiple banks failed.
The crisis went global as: losses mounted; these were magnified by gearing, which forced investment banks and hedge funds to liquidate sound positions to meet redemptions thereby spreading the crisis to other assets; the distribution of securities investing in US sub-prime debt globally led to a wide range of exposed investors and hence greater worries about who was at risk; this all led to a freezing up of lending between banks.
All of which affected confidence and economic activity.
Fault lay with home borrowers, the US Government, lenders, ratings agencies, regulators, and investors and financial organisations for taking on too much risk.
It came to an end in 2009 after significant monetary easing and fiscal stimulus helped restore the normal operation of money markets, confidence and growth.
That said, aftershocks continued with sub-par global growth and very low inflation.
The GFC highlighted several lessons for investors:
· The economic and investment cycle is alive and well. Talk of a “great moderation” was all the rage prior to the GFC but the GFC reminded us yet again that periods of great returns are invariably followed by a fall back. If returns are too good to be true they probably are.
· High returns come with higher risk. While risk is often dormant for years, it usually returns with a vengeance as was apparent in the GFC. Backward-looking measures of volatility are no better than attempting to drive focussed only on the rear view mirror.
· While each boom bust cycle is different, markets are pushed to extremes of valuation and sentiment. The low in 2009 was characterised by ultra cheap shares and credit investments with investors highly pessimistic.
· Be sceptical of financial engineering or hard-to-understand products. The biggest losses for investors in the GFC were generally in products that relied heavily on financial engineering purporting to turn junk into AAA investments that were impossible to understand.
· Avoid too much gearing or gearing of the wrong sort. Gearing is fine when all is going well. But it will magnify losses when things reverse and can force the closure of positions at a big loss when the lenders lose their confidence and refuse to roll over maturing debt or when a margin call occurs forcing an investor to sell their position just at the time they should be adding to it.
· The importance of true diversification. While listed property trusts and hedge funds were popular alternatives to low-yielding government bonds prior to the GFC, through the crisis they ran into big trouble (in fact Australian Real Estate Investment Trusts (REITs) fell 79%), whereas government bonds were the star performers. REITs have cut their gearing and returned to their knitting. But “in a crisis correlations go to one – except for true safe havens”.
· Fiscal and monetary policy work. There is a role for government in putting free market economies back on track when they get into a downward spiral. While some have argued that easy money just benefitted the rich (who invest in shares), doing nothing would have likely ended with 20% plus unemployment and worse inequality.
· The return to normal from major financial crises can take time, as the blow to confidence depresses lending and borrowing and hence consumer spending and investment for years afterwards. This muscle memory eventually fades but the impact can be seen for a decade or so.
· The importance of asset allocation. The GFC provided an extreme reminder that what really matters for your investment performance is your asset mix – ie your allocation to shares, bonds, cash, property, etc. Exposure to individual shares or fund managers is second order.
· Finally, “stuff happens”. While after each economic crisis there is a desire to “make sure it never happens again”, history tells us that manias, panics and crashes are part and parcel of the process of “creative destruction” that has led to an exponential increase in material prosperity in capitalist countries. The trick is to ensure that the regulation of financial markets minimises the economic fallout that can occur when free markets go astray but doesn’t stop the dynamism necessary for economic prosperity.
Of course there will be another boom and bust...but as Mark Twain is thought to have said “history doesn’t repeat, but it rhymes” so the specifics will be different next time.
History is replete with bubbles and crashes and tells us it’s inevitable that they will happen again as each generation forgets and must relearn the lessons of the past.
Often the seeds for each new bubble are sown in the ashes of the former.
Fortunately, in the post-GFC environment seen so far there has been an absence of broad-based bubbles on the scale of the tech boom or US housing/credit boom.
E-commerce stocks like Facebook and Amazon are a candidate but they have seen nowhere near the gains or infinite PEs seen in the late 1990s tech boom.
Click to enlarge
On the global debt front, a concern is that after a post-GFC pull back, it has grown to an all-time high relative to global GDP.
Click to enlarge
However, just because global debt has grown to a new high doesn’t mean a crisis is upon us.
It has been trending up for decades, much of the growth in debt in developed countries post the GFC has been in public debt and debt interest burdens are low thanks to low interest rates in contrast to the pre-GFC period.
Furthermore, the other signs of signs of excess that normally set the scene for recessions and associated deep bear markets in shares like that seen in the GFC are not present on a widespread basis just now.
Inflation is low, monetary policy globally has barely tightened, there has been no widespread overinvestment in technology (as preceded the tech wreck) or housing (as preceded the GFC in the US) and bank lending standards have not been relaxed to the same degree as seen prior to the GFC.
Moreover, financial regulations have tightened significantly with banks required to have higher capital ratios and source a greater proportion of funds from their depositors.
So another boom bust cycle is inevitable at some point, but it will likely be very different to the GFC.
And many of the signs of excess that normally precede deep bear markets are still absent.
<a href="https://www.propertyobserver.com.au/https://plus.google.com/110172465327488162875?rel=author" target="_blank">SHANE OLIVER</a> is head of investment strategy and economics and chief economist at <a href="https://www.ampcapital.com.au/home" target="_blank">AMP Capital</a> and is responsible for AMP Capital's diversified investment funds.
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soliver-smf6LQXgW9

Lessons learned a decade from the GFC: Shane Oliver

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GUEST OBSERVER
A new report by JLL says it is time to review pre - Global Financial Crisis yardsticks to judge future investment performance for commercial real estate.  Instead, investors need to look more broadly at the long-term structural changes to the market that have been underway, behind the scenes.
And don’t wait for ‘normal’ market conditions to return, as traditional real estate benchmarks may not be reliable indicators in the future.  Some metrics, such as workspace ratios and retail turnover ratios, may no longer even be relevant in the shifting world of workplace mobility and IT connectivity.
The Report - ‘Real Estate Conundrums - Just another cycle – or a whole new ball game?’ was presented at a JLL Research event in Sydney.
Technology and urbanisation have been gathering pace for decades.  But while the cyclical nature of real estate has not been abolished, investors in real estate face a range of conundrums relating to yields, cross border investment, technology and urbanisation that can have long-term impacts for commercial real estate.
<a href="/images/2016/06/16/Screen%20Shot%202016-06-16%20at%208.26.15%20AM.png" target="_blank">Click to enlarge</a>
<img src="/images/2016/06/16/Screen%20Shot%202016-06-16%20at%208.26.15%20AM.png" alt="">
The GFC has been a convenient scapegoat for the breakdown in previously trusted rules of thumb when investing in commercial real estate.  While for some the benchmarks of the years 2007-2008 do seem to mark a clear break from the patterns of the past, many trends have been evident for far longer than that.  Not everything is a GFC-driven event. For instance, real and nominal interest rates have been declining for 30 years.
The challenge for investors right now is that numerous structural and cyclical shifts are emerging, converging and interacting with each other.
Structural shifts for Australian commercial real estate:
<ul>
<li>Real estate markets are globalising – tenants, investors, developers</li>
<li>
Yields: Low growth, low inflation, low yields are also here to stay</li>
<li>
Cross Border Investment: Offshore capital is here to stay</li>
<li>Fundamental mismatch between capital and available assets</li>
</ul>
Market cycles have not been abolished:
<ul>
<li>Yields will cycle around lower benchmark levels</li>
<li>
Demography a key driver of all real estate asset classes</li>
<li>Financial markets move faster than physical markets</li>
<li>Don’t wait for ‘normal’ conditions to return</li>
</ul>
Structural Shifts – Yields and Cross Border Investment:
Implicit in JLL Research forecasts is a downward structural shift in interest rates and real estate yields – in other words, the ‘lower for longer’ theory is correct.  This does not mean that cycles have been abolished.  But average yields are likely to be lower than in the past.
<a href="/images/2016/06/16/Screen%20Shot%202016-06-16%20at%208.28.57%20AM.png" target="_blank">Click to enlarge</a>
<img src="/images/2016/06/16/Screen%20Shot%202016-06-16%20at%208.28.57%20AM.png" alt="">
Supported by growth in global pools of capital and a search for yield, JLL calculates that global cross border investment will continue to grow over the medium term.  In Australia, cross border investors accounted for 42 percent of all commercial property transactions in 2015.
While the impact of technology has been massive, the impact on real estate has been less than was anticipated 20 years ago; CBD’s remain magnets for office and retail tenants, despite rising travel and congestion costs, and inner-city residential demand (which was not foreseen) has increased substantially.
Perhaps though the falling cost of technology, the advent of wireless capabilities, combined with the rising cost and scarcity of skilled labour and rising wages (that puts a premium on commuting travel times) will now lead to a more substantial impact on real estate investment returns and a re-ranking of market values in CBD and non-CBD locations? 
If location premiums erode, non-CBD and suburban locations could be rewarding for investors.
Demography (and urbanization): – is it destiny?
Are we under-estimating the impact of the changing population age profile?  Baby-boomers and first home buyers are important – but over time there are many other impacts on real estate to consider – childcare, student housing, retirement living as well as the age profile within the working age population. 
While population will grow across all age categories in Australia, some age groups will grow much faster than others – therefore requiring specific real estate solutions – right across the spectrum from childcare, student accommodation, first home buyers, upgraders, empty nesters and retirement villages.
 
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David Rees is regional director, head of research, JLL Australasia and can be contacted <a href="https://www.jll.com.au/australia/en-au/people/113/david-rees" target="_blank">here.</a>
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Time to review pre-GFC yardsticks to judge future performance of commercial real estate: JLL's David Rees

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<img src="https://counter.theconversation.edu.au/content/57114/count.gif" alt="The Conversation" width="1" height="1">
GUEST OBSERVER
"We’ve had 25 years of continuous economic growth, the only country in the world with a period of growth that long. – Trade minister Steven Ciobo, speaking on Q&amp;A, May 31, 2016."
Economic management is shaping up as a key election battleground, and the Coalition has been especially keen to keep the focus on the economy.
Trade minister Steven Ciobo told Q&amp;A viewers that Australia has had 25 years of continuous economic growth, and is the only country in the world with a period of growth that long.
Is that right?
<h2>Checking the source</h2>
A spokesman for Steven Ciobo told The Conversation that Ciobo misspoke on Q&amp;A. The spokesman said by email that:
Mr Ciobo omitted the world developed, he meant to say “developed country”.
That clarification does improve the accuracy of his statement quite considerably. Let’s test his two statements separately.
<h2>25 years of continuous economic growth?</h2>
Australia entered a period of low and sometimes negative economic growth in 1989. The last period where growth was negative was June 1991 (for the quarter-over-quarter growth), and December 1991 (for the year-over-year growth).
I would argue that the weak growth through 1991 means that you can’t say that the economy recovered and was growing until 1992.
So on that definition, we have had about 24.5 continuous growth – which is close enough to the Ciobo’s figure of 25 years.
It is true we are in our 25th year of consecutive economic growth. That’s how it was phrased in Austrade’s 2016 Why Australia Benchmark Report, which noted that:
Australia is not only entering its 25th year of consecutive growth, the country is expected to realise annual real GDP growth of 2.9% between 2016 and 2020 – the fastest of any major advanced economy in the world.
<h2>The only country in the world?</h2>
As the minister’s spokesman said, Ciobo accidentally omitted the word “developed” from his statement.
It is true that all of the other 33 member countries in the Organisation for Economic Co-operation and Development (OECD) have had a period of negative GDP growth since 1991, with most going into recession during the Global Financial Crisis.
It is notable that the dip in growth during the GFC was smaller for the Group of 20 (G20) major economies than for the OECD, and the reason for this is that many emerging markets did not go into recession.
It is not true to say, as the minister accidentally did, that Australia is the only country in the world with a period of growth that long. The chart below shows Australia’s growth next to the G20, OECD, India and China.
<a href="/images/2016/06/06/image-20160531-13810-hgnto5.png" target="_blank">Click to enlarge</a>
<img src="/images/2016/06/06/image-20160531-13810-hgnto5.png" alt="">
<h4>Author provided. Source: OECD Main Economic Indicators and Emerging Markets database in DX database.</h4>
The chart shows that China and India, the two most important emerging economies, also have had positive growth in GDP in the past 25 years. It is now more than 25 years since both countries began their economic reform programs, and both countries have enjoyed very strong economic growth over this period.
<h2>Verdict</h2>
The statement that Australia has had 25 years of continuous economic growth is mostly correct.
The statement that Australia is the only country in the world to have had such a period of unbroken growth is incorrect. But it’s true Australia is the only one out of 34 OECD member countries to have had positive economic growth since 1991.  
Mark Crosby is associate professor of Economics, Melbourne Business School and author for The Conversation. He can be contacted <a href="https://theconversation.com/profiles/mark-crosby-444" target="_blank">here</a>.
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