<section data-scroll-anchor="false" data-testid="conversation-turn-5" data-turn="user" data-turn-id="e65dbe94-e3b6-47f7-b62a-9cbb30c9bf79" data-turn-id-container="e65dbe94-e3b6-47f7-b62a-9cbb30c9bf79" dir="auto">Time &amp; Place’s plans to transform the former David Jones factory building in Surry Hills into a mixed-use residential precinct have gone on exhibition through the NSW Government’s In-fill Affordable Housing pathway.</section>

<section data-scroll-anchor="false" data-testid="conversation-turn-6" data-turn="assistant" data-turn-id="request-WEB:f4d533b7-64a5-413d-86fd-5c99649c2b73-2" data-turn-id-container="request-WEB:f4d533b7-64a5-413d-86fd-5c99649c2b73-2" dir="auto">
<p data-end="577" data-start="264">The Marlborough House proposal, lodged for the <a href="https://www.apartments.com.au/new-apartments/marlborough-house-47-97-marlborough-street-surry-hills-nsw-2010">47-97 Marlborough Street</a> site, would see the adaptive reuse of the heritage-listed warehouse building alongside the construction of new residential additions and a separate apartment building on the northern portion of the site.</p>

<p data-end="577" data-start="264">The proposal seeks approval for 172 apartments across three buildings, including 15 per cent affordable housing managed by a community housing provider for at least 15 years from occupation.</p>

<p data-end="577" data-start="264"><img alt="Marlborough" data-entity-type="file" data-entity-uuid="5d1d3c2a-bf13-47d6-a335-7c01102cdee1" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-28%20at%209.29.36%E2%80%AFAM.png?VersionId=cjMYrbR.BLUlWH4dar0RVDDo0bG.u2YT" /></p>

<p><em>Interior view from the Northern Building Penthouse overlooking the park</em></p>

<p>&nbsp;</p>

<p data-end="1070" data-start="809">The redevelopment is planned for the prominent 3,413 sqm site bounded by Marlborough Street, Goodlet Street and Lansdowne Street, directly opposite Eddie Ward Park and around 200 metres from the Surry Hills light rail stop.</p>

<p data-end="1246" data-start="1072">Time &amp; Place acquired the former David Jones building in 2024, marking the first time the property had changed hands in around 50 years.</p>

<p data-end="1483" data-start="1248">Designed by Wardle, the proposal centres around the adaptive reuse of the former David Jones factory, originally constructed between 1913 and 1935 in the Inter-War Chicagoesque architectural style.</p>

<p data-end="1854" data-start="1485">Wardle noted in its Architectural Design Report that the building “occupies a significant place in the industrial and cultural history of Surry Hills” and at its peak was “the largest department store manufacturing facility in Australia, employing over 800 people and fuelling the growth of Sydney’s fashion and retail industries.”</p>

<p data-end="2059" data-start="1856">The practice said the project positions itself “not as an isolated intervention, but as a contributor to the civic, social, and architectural grain of the precinct.”</p>

<p data-end="2318" data-start="2061">The proposal would deliver 75 apartments within the retained southern heritage building, 59 apartments within the central addition, and a further 38 apartments within the new northern building fronting Lansdowne Street.</p>

<p data-end="2486" data-start="2320">Planning documents show the scheme would comprise a mix of heritage apartments, new-build apartments, townhouses and penthouses.</p>

<p data-end="2486" data-start="2320"><img alt="Marlborough" data-entity-type="file" data-entity-uuid="57758518-40a3-4b83-958c-d06e96a2cffa" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-28%20at%209.29.42%E2%80%AFAM.png?VersionId=VerlX9ST5xgBi8.1_YRsqdWTJeT6ygjs" /><em>Interior View of the Heritage Building Apartment</em></p>

<p data-end="2814" data-start="2488">The development would also include a ground-floor retail tenancy on the corner of Marlborough and Lansdowne streets, rooftop communal open space, a landscaped pedestrian link along the western edge of the site, and basement parking accessed from Lansdowne Street via a car stacker system.</p>

<p data-end="3188" data-start="2816">&nbsp;</p>

<p data-end="3625" data-start="3404">The scheme emerged from a competitive design process run by Urbis, with Wardle ultimately selected as the winning architect ahead of FJC Studio, TZG, Architectus and Wilkinson Eyre.</p>

<p data-end="4003" data-start="3627">The Design Integrity Panel later described several aspects of the Wardle scheme as fundamental to the project, including “the stepped character of the new addition to the north of the site”, the landscaped western pedestrian link, and the “garden arrival” experience separating the original Marlborough House from the heritage addition.</p>

<p data-end="4149" data-start="4005">Wardle’s design heavily references the site’s industrial and heritage history, while also responding to the surrounding Surry Hills streetscape.</p>

<p data-end="4488" data-start="4151">The Architectural Design Report describes Surry Hills as “a finely grained neighbourhood with beautiful and expressive brickworks throughout the suburb,” with the proposal introducing a material palette intended to sit comfortably alongside the existing warehouse fabric and neighbouring terraces.</p>

<p data-end="4609" data-start="4490">The report also outlines the project’s relationship with Eddie Ward Park and the broader landscape context of the area.</p>

<p data-end="4894" data-start="4611">“Marlborough House occupies a site of deep cultural memory and the neighbouring Eddie Ward Park is of local ecological significance, where natural systems, topography, and stories have long shaped human experience,” Wardle noted in the report.</p>

<p data-end="5090" data-start="4896">The architects said the proposal sought to “rebind built form to Country” through landscape, materiality and the adaptive reuse of the heritage structure.</p>

<p data-end="5090" data-start="4896"><img alt="Marlborough House" data-entity-type="file" data-entity-uuid="9ae3f2f9-c85f-477a-a6f8-b43f6cb97c41" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-28%20at%209.29.53%E2%80%AFAM.png?VersionId=B.qUCLqRvJOR.n9CvYcTpaknIX9LuqKZ" /></p>

<p data-end="5304" data-start="5092">The project is also being progressed under the NSW Government’s in-fill affordable housing provisions, allowing developments that include affordable housing to access additional height and floor space incentives.</p>

<p data-end="5498" data-start="5306">Under the plans, 2,593 sqm of the project’s floor space would be dedicated to affordable housing, slightly exceeding the required 15 per cent threshold.</p>

<p data-end="6154" data-is-last-node="" data-is-only-node="" data-start="5806">In its Design Excellence Strategy, Urbis said the project aimed to “sensitively adapt and enhance the heritage-listed building on site through alterations and additions that preserve its historical significance” while delivering “high-quality market and infill affordable housing development in Surry Hills.”</p>

<p>Time &amp; Place has been one of the most active developers nationally in the last 12 to 24 months. Late last year they completed&nbsp;The Queensbridge in&nbsp;<a href="https://www.apartments.com.au/developments/southbank-vic-3006">Southbank</a>, a mixed-use tower with 353 apartments and a hotel. They are currently selling Park Modern, 246 apartments near the famous Botanic Gardens in&nbsp;<a href="https://www.apartments.com.au/developments/south-melbourne-vic-3205">South Melbourne</a>, and have future projects, <a href="https://www.apartments.com.au/new-apartments/the-wilmot-173-burke-road-28-hope-street-glen-iris-vic-3146">The Wilmot</a>&nbsp;in&nbsp;<a href="https://www.apartments.com.au/new-apartments/glen-iris-vic-3146">Glen Iris</a>, the redevelopment of the Northcote Plaza, and another tower in South Melbourne.</p>

<p>The developer broke into Sydney just a few years ago with Two Tides in Manly. They have another project nearby, which is at the ultra-luxury end of the market on&nbsp;<a href="https://www.apartments.com.au/buildings/shoreline-manly-beach-89-90-north-steyne-manly">North Steyne</a>, fronting the beach.</p>

<p>It is also continuing to work through the <a href="https://www.apartments.com.au/news/nsw/first-look-time-place-settles-on-design-for-the-chimes-potts-point-redevelopment">redevelopment of The Chimes building</a> on Macleay Street in&nbsp;<a href="https://www.apartments.com.au/developments/potts-point-nsw-2011">Potts Point</a>, as well as a project on <a href="https://www.apartments.com.au/news/nsw/time-place-to-take-on-mosman-apartment-market">Mosman's Redan Street</a>.</p>
</section>


Joel Robinson

First look: Time & Place unveils Marlborough House redevelopment designs for former David Jones warehouse in Surry Hills

<p>The residential transformation of St Kilda Road is set to continue into with more new apartment plans for the sought-after boulevard.</p>

<p>Wing Tai Asia has lodged plans for a major residential tower at 464-466 St Kilda Road, replacing the former VACC House with an 18-storey mixed-use development designed around a retained heritage podium and a sculpted contemporary tower.</p>

<p>The proposal, prepared under Victoria’s Significant Residential Development with Affordable Housing pathway, would deliver 325 apartments and ground-floor retail across the prominent 4,653 sqm boulevard site in Melbourne’s St Kilda Road North Precinct.</p>

<p>The project centres on the adaptive reuse of the site’s heritage-listed VACC Building, an eight-storey office designed by Bernard Evans that has occupied the address for decades. Planning documents state the development would involve “carefully dismantling and conserving off-site the original metal fabric of the podium visible from St Kilda Road,” before reinstating it as the defining frontage of the new scheme.</p>

<p>Above the restored podium, Wing Tai is proposing a curvilinear residential tower. The scheme includes 172 one-bedroom apartments, 63 two-bedroom apartments, 66 three-bedroom apartments, and 24 four-bedroom apartments, alongside two ground-floor food and beverage tenancies fronting St Kilda Road.</p>

<p>The tower has been designed with substantial articulation and variable setbacks to minimise perceived bulk and maintain view corridors along the boulevard. Urbis, which prepared the planning report, said the design “has been significantly articulated through a curvilinear design” with “an interplay with materials, façade expression and depth” to create visual separation and visual interest.</p>

<p>The proposal also includes 254 basement car spaces, landscaped pedestrian links connecting St Kilda Road and Queens Lane, and a biophilic landscape strategy featuring canopy trees, raised planters, cascading greenery and a glass oculus pool overlooking the eastern frontage.</p>

<p>Planning documents confirm the $270.1 million development will contribute 3 per cent of project costs to the Social Housing Growth Fund as part of the application process.</p>

<p>Wing Tai acquired the St Kilda Road property in 2018 alongside Abacus Property Group for $95.38 million, before later consolidating ownership of the site. The property previously served as the Victorian Automobile Chamber of Commerce headquarters for around 60 years.</p>

<p data-end="345" data-start="110">The transformation of the St Kilda Rd boulevard is already beginning to materialise, with a number of high-profile projects recently completed, launched, or approaching launch as developers continue to back the long-term appeal of the precinct.</p>

<p data-end="689" data-start="347">Among the most notable recent completions is Louise by Samuel Property Group, just off the strip on Queens Lane, the same pocket Hirsch &amp; Faigen recently launched The Queensbury. Mirvac is too on the same street with The Albertine, which is approaching completion.</p>

<p data-end="689" data-start="347">Dexus recently secured approval for its slice of St Kilda Road, while Gurner also has approved plans for the precinct.</p>


Wing Tai unveils 325-apartment St Kilda Road tower on former VACC House site

<p>Malaysian developer <a href="https://www.apartments.com.au/developers/s-p-setia">SP Setia</a> is the latest to jump into St Leonards booming Transport Oriented Development precinct.</p>

<p>The developer, which has previously delivered Sapphire by the Gardens apartment development in Melbourne, identified the Atchison Street site in 2023. It filed a Scoping Report around 12 months ago, and now has revealed the designs for the new&nbsp;40-storey mixed-use tower.</p>

<p>The State Significant Development Application covers <a href="https://next-portal.urban.com.au/projects/14650/summary">20-22 Atchison Street</a>, a 1,374 sqm site positioned between St Leonards Station and the new Crows Nest Metro station.</p>

<p>Designed by <a href="https://www.apartments.com.au/architects/cox-architecture">COX Architecture</a>, the project would deliver 181 apartments, above a four-storey commercial podium, five basement levels, and new public domain works along Mitchell Street. The apartment mix comprises 35 one-bedroom apartments, 39 one-bedroom-plus-study apartments, 85 two-bedroom apartments, and 22 three-bedroom residences.</p>

<p>The proposal has been lodged as a shop-top housing development under the NSW Government’s TOD planning pathway, which allows increased density around key transport infrastructure. The site sits within the recently rezoned Crows Nest Accelerated TOD Precinct.</p>

<p><img alt="First look: SP Setia targets St Leonards skyline with 40-storey TOD tower" data-entity-type="file" data-entity-uuid="b799673d-48e2-46b0-801a-0e33a9330100" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/atchinson%20site.png?VersionId=dPh0UfwfaHpbFL1R7H1cbZNbIW0CHbCC" /></p>

<p>SP Setia acquired the Atchison Street site as part of its continued expansion into the Australian apartment market. In comments made to City &amp; Country (The Edge Malaysia) in 2023, SP Setia President and CEO Datuk Choong Kai Wai described the acquisition as “a strategic move” aligned with the group’s post-pandemic market recovery strategy.</p>

<p>“Our target for this exceptional development is local and overseas buyers, including first-home buyers, downsizers and investors,” Choong said.</p>

<p>The tower has been designed as a slender vertical form rising from a mixed-use podium, with COX Architecture positioning the development as a response to the evolving St Leonards and Crows Nest skyline.</p>

<p>“The purpose of the project is to facilitate the delivery of high-quality housing at a strategically located site and deliver a built tower outcome that is consistent with the desired future character of St Leonards and aligns with the TOD controls,” the design report stated.</p>

<p><img alt="First look: SP Setia targets St Leonards skyline with 40-storey TOD tower" data-entity-type="file" data-entity-uuid="b1a85eee-76f7-436c-a6da-73ba827b9b13" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/atchinson%20entry.png?VersionId=dA9jHGPMcm.dDbwk4QfxqWiY5bfh3UVt" /></p>

<p>The podium would incorporate retail uses fronting Atchison Street, commercial tenancies, landscaped communal areas, and pedestrian improvements along Mitchell Street. Vehicle access and loading would be consolidated via Atchison Lane.</p>

<p>Residents would have access to more than 665 sqm of communal indoor and outdoor spaces, while the development proposes 96 parking spaces across five basement levels.</p>

<p>The proposal also includes a commitment for 10 per cent of residential floor space to be allocated toward affordable housing through a monetary contribution.</p>

<p>COX said the tower form responds directly to the emerging high-density character of the precinct while seeking to maximise solar access, cross ventilation, and outlook from apartments.</p>

<p><img alt="First look: SP Setia targets St Leonards skyline with 40-storey TOD tower" data-entity-type="file" data-entity-uuid="2163f85c-f63b-4be3-aafa-f8763976cec5" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Article%20Feature%20Image%20%28Grid%29_5.png?VersionId=WiAmtIKJ6.ZQ41EtYEQ1fol7AeorKBlL" /></p>

<p>“The building is orientated towards north,” the Apartment Design Guide compliance report noted, adding that the tower’s slim form was driven by the constrained inner-urban site dimensions.</p>

<p>The design also incorporates landscaped setbacks and communal open space at podium level, intended to soften the interface with surrounding streets and improve pedestrian amenity.</p>

<p>The project adds to a growing wave of redevelopment proposals reshaping St Leonards and Crows Nest following the opening of the Sydney Metro City line and the NSW Government’s push for higher-density housing around major transport nodes.</p>

<p>Last week Stockland filed plans just down the road. They want to build a <a href="https://www.apartments.com.au/new-apartments/601-pacific-highway-st-leonards-nsw-2065">52-storey tower on Pacific Highway</a>.</p>

<p><em>Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/first-look-stockland-plans-52-storey-538-apartment-st-leonards-tower">First look: Stockland plans 52-storey, 538-apartment St Leonards tower&nbsp;</a></em></p>


First look: SP Setia targets St Leonards skyline with 40-storey TOD tower

<p><a href="https://www.apartments.com.au/developers/urban-property-group">Urban Property Group</a> has revealed plans for a new mixed-use tower at 10 Dangar Street, Wickham, advancing a proposal that would reshape the southern gateway to Newcastle’s city centre with one of the city’s tallest residential buildings.</p>

<p>The State Significant Development proposal, now on exhibition, seeks approval for a <a href="https://www.apartments.com.au/new-apartments/bowline-10-dangar-street-wickham-nsw-2293">43-storey tower</a> immediately adjacent to the Newcastle Interchange. The project would deliver around 200 apartments, including 42 affordable housing dwellings, alongside 99 co-living units, a 171-room hotel, retail space, and new public domain integrated through the site.</p>

<p>The scheme marks a significant escalation of plans previously approved for the site. Urban Property Group took over the prominent 2,904 sqm parcel, where excavation and demolition had already commenced under an earlier consent for a 14-storey mixed-use development.</p>

<p><img alt="First look: Urban Property Group unveils Newcastle’s next supertower at Wickham interchange" data-entity-type="file" data-entity-uuid="58a96dd9-407f-4d20-86b4-94e4bfeef74b" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/wickham%20podium.png?VersionId=LGlf08pdFGAZDzvx_CXC4XakHNZRuEE0" /></p>

<p>Designed by <a href="https://www.apartments.com.au/architects/sjb-architects">SJB</a>, the tower has been conceived as a landmark transit-oriented development anchored to the Newcastle Interchange precinct. The proposal includes 245 build-to-sell apartments across a mix of one, two, and three-bedroom residences, as well as two penthouses. Fifteen apartments and one operational unit are earmarked for NDIS housing. The co-living component would add a further 99 units, while the podium would accommodate retail uses and hotel facilities.</p>

<p>SJB said the site presents “a valuable opportunity to anchor the precinct by setting the standard for design, active ground planes and character at the key southern gateway.”</p>

<p>The architecture responds directly to the site’s position beside major transport infrastructure and within one of Newcastle’s fastest-evolving urban renewal precincts. The tower form sits above a sculpted podium designed to frame new public spaces, including a through-site pedestrian link connecting Station Street to Hannell Street, landscaped plazas, and activated retail edges.</p>

<p><img alt="First look: Urban Property Group unveils Newcastle’s next supertower at Wickham interchange" data-entity-type="file" data-entity-uuid="a7bd6ff0-f7db-4ce8-a6dc-ea56e72c6149" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/wickham%20lanne.png?VersionId=xzf39VADyhj7zBQY2I9fx9vI62u2tuSb" /></p>

<p>The design report describes the project as part of the broader transition of Wickham into “a vibrant, high-quality mixed-use urban precinct” that leverages proximity to the station, open space, and regional connectivity.</p>

<p>A detailed public art strategy has also been prepared for the development. The strategy positions the project as “a transit-oriented development of state significance at the gateway to Newcastle’s city centre” and outlines a series of integrated artworks responding to Newcastle’s industrial and transport heritage.</p>

<p>Creative Road’s curatorial framework for the project, titled Unveil, draws on “stratified surfaces, carved volumes, and light-filled apertures” while referencing Newcastle’s transformation from an industrial city into a contemporary education and technology hub.</p>

<p><img alt="First look: Urban Property Group unveils Newcastle’s next supertower at Wickham interchange" data-entity-type="file" data-entity-uuid="77a882bb-14b1-4d28-99ff-9438e39508c0" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/wickham%20site.png?VersionId=cevgo_vN0eKPK78P8YcEu3mKPLkpFqE7" /></p>

<p>The proposal is being advanced through the NSW Housing Delivery Authority pathway after being declared State Significant Development in June 2025. The accompanying scoping report states the development aims to “maximise the site’s proximity to the Newcastle Interchange by delivering transit-oriented development” while increasing housing supply and affordable housing provision within the Newcastle LGA.</p>

<p>Urban Property Group’s plans align with the long-term strategic vision established under the Wickham Master Plan, which identified the interchange precinct as suitable for substantial uplift in height and density. The current proposal would significantly intensify that vision, positioning the tower among the tallest developments proposed for Newcastle.</p>

<p>The site sits immediately north of the Newcastle Interchange, bounded by Dangar Street, Hannell Street, and Charles Street. It is surrounded by a rapidly growing cluster of residential towers and mixed-use projects that have emerged following the completion of the light rail and transport interchange.</p>


First look: Urban Property Group unveils Newcastle’s latest tower at Wickham interchange

<p>Bottega House has completed settlement of a landmark riverfront site in Macquarie Street, St Lucia, representing its first major Brisbane development.&nbsp;</p>

<p>Positioned on the banks of the Brisbane River, the <a href="https://www.apartments.com.au/new-apartments/180-macquarie-street-st-lucia-qld-4067">premium site at 180 Macquarie Street</a> features uninterrupted river frontage in one of Brisbane’s most tightly held residential precincts.&nbsp;</p>

<p>The proposed development, currently under assessment with Brisbane City Council, has been designed by <a href="https://www.apartments.com.au/architects/plus-studio">Plus Studio</a> with interiors by <a href="https://www.apartments.com.au/interior-designers/mim-design">Mim Design</a> and will deliver a boutique collection of premium residences positioned specifically for owner occupiers and downsizers.&nbsp;</p>

<p>The residences are set to redefine luxury apartment living in the area, with a focus on architectural quality, refined finishes, landscape integration and elevated amenities including curated wellness facilities, resort-style pools and recreation spaces rarely seen in the local market.&nbsp;</p>

<p>Exclusive sales for the project will be led by Keenan &amp; Byrne, ahead of an anticipated launch later this year.&nbsp;</p>

<p>Bottega House Managing Director Nick Malloch said the project reflects the group’s ambition to deliver a highly curated residential offering within one of Brisbane’s most tightly held precincts.&nbsp;</p>

<p>“This is an incredibly rare riverfront opportunity and one we have approached with a long-term perspective,” Malloch said.&nbsp;</p>

<p>“Our vision from the outset was to create a boutique collection of residences that feel more like private homes than traditional apartments, with generous proportions, refined finishes and exceptional amenity throughout."</p>

<p>Malloch says there is a&nbsp;lack of premium owner-occupier stock of this quality in the market, particularly for downsizers wanting space, privacy and a true lifestyle offering without compromise.&nbsp;</p>

<p>"Demand is expected to be strong given the scarcity of premium riverfront opportunities of this nature within Brisbane’s inner-west."&nbsp;</p>


Bottega House secures landmark riverfront site in St Lucia 

House Prices

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<p>Quarterly growth in the value of Sydney’s median house was a modest 0.03 percent for April, off the back of losses in the March quarter according to Residex.</p>

<p>Residex state Sydney has a stagnant median house value of just over $1,040,000, where it has been hovering around since January, however units in the Sydney market increased a significant 1.26 percent over the April quarter, following losses in January. The median Sydney unit is now at a historic high of $695,000.</p>

<p>According to Residex the Melbourne market experienced more significant easing in the April quarter, with the median house and median unit value dropping by approximately $5,000 and $3,000 respectively. </p>

<p>Table 1 presents the statistics summary for April.</p>

<p> </p>

<p><a href="http:/www.propertyobserver.com.au/images/2016/06/30/Table_1.jpg" target="_blank">Click to enlarge</a></p>

<p><img alt="" src="/images/2016/06/30/Table_1.jpg"></p>

<p><em><span>Source: Residex</span></em></p>

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jonathanchancellor-7SQnKwU6yx

Sydney's median house value growth modest: Residex

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<p>Melbourne is expected to overtake Sydney in 2016 as the best performing capital city in terms of market growth in house values, with property price growth expected to hover around 8 percent in Melbourne while Sydney is expected to see growth of about 4 percent according to Herron Todd White.</p>
<p>According to HTW's latest market review, the apartment market for central Melbourne has started to soften with a 0.5 percent drop in unit prices for the first quarter of 2016, including a fall of 0.9 percent in March, and is attracting those priced out of the Sydney market.</p>
<p>"With the steep price of housing in Sydney, home buyers are finding it unaffordable and are looking to other capital cities such as Melbourne," HTW said.</p>
<p>"Melbourne is expected to overtake Sydney in 2016 as the best performing capital city in terms of market growth in house values with property price growth expected to hover around 8 percent in Melbourne while Sydney is expected to see growth of about 4 percent.</p>
<p>"Comparing Sydney’s median house price of $995,804 at the end of the March 2016 quarter with Melbourne’s median house price of $713,000, housing is evidently more affordable in Melbourne. Melbourne’s median house price has had a steady growth over the past few years since the GFC demonstrating the strength of Melbourne’s economy and overall property market. "</p>
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Melbourne to overtake Sydney in 2016 as the best performing capital city for market growth: HTW

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<p>House price growth in Sydney and Melbourne is set to halve over forthcoming months, according to the HSBC chief economist Paul Bloxham.  </p>
<p>Sydney and Melbourne house prices grew 13 percent and 14 percent respectively in the year to May, with Bloxham expecting this to decline.</p>
<p>He suggests tighter lending standards, an oversupply of apartments and the escalation of the taxation of foreign buyers to weigh on the market.</p>
<p>He forecasts national growth to slow from the national 9 percent in 2015 to around 4 percent to 5 percent later this year.</p>
<p>The 2017 house price growth will be even slower - between 0 percent and 5 percent, he tips.</p>
<p>He said the re-acceleration of housing prices was "somewhat surprising, given continued tight lending standards and slowing credit growth."</p>
<p>Bloxham expects further tightening of lending standards should there be a strong pick-up in investor borrowing.</p>
<p>"A cooling of the housing market is expected to leave the RBA with room to consider cutting its cash rate further in coming quarters, if needed," he said in a note to clients obtained by Fairfax Media.</p>
<p>"Given the already strong gains in recent years in Sydney and Melbourne, the authorities have been seeking to cool the housing market in these cities."</p>
<p>Mr Bloxham points to solid demand from foreign buyers as one of the main causes for the impressive growth.</p>
<p>In particular, Chinese demand for Australian residential property has been a key driver in the recent fall of the Australian dollar against the yuan, offsetting the increase in Australian dollar-denominated housing prices since 2012.</p>
<p>"In short, Australian housing is just as cheap now for a Chinese buyer as it was four years ago and has become more affordable relative to property in most Chinese urban centres," says Mr Bloxham.</p>
<p>While it is difficult to measure the scale of foreign demand, statistics from the Foreign Investment Review Board suggest approvals have seen a sharp 20 per cent increase of total housing market turnover in 2014-15.</p>
<p>However, new stamp duty and land tax surcharges imposed on foreign buyers will be implemented in NSW, Queensland and Victoria, and are likely to stall foreign demand.</p>
<p>"Foreign purchases could partly explain the recent ramp-up in Sydney and Melbourne housing prices," says Mr Bloxham.  </p>
<p>"We expect recent increased taxes and changes to local bank lending practices are likely to weaken this source of demand in coming quarters."</p>
<p> The oversupply of apartments will be the third factor prompting house price growth to halve by year's end, though Mr Bloxham concedes it won't happen for a while yet.</p>
<p>"Our estimates suggest that, although there has been a strong ramp-up in apartment construction, we are yet to reach the point of balance in the national housing market."</p>
<p>Bloxham points out apartments account for only 24 per cent of the national housing stock.</p>
<p>"We expect that apparent oversupply in the apartment markets in Brisbane and Melbourne may see some unit price declines in these cities, but we expect the detached housing market to continue to see modest price gains," says Mr Bloxham.</p>
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Paul Bloxham says housing price growth to halve over 2016

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<p>Harry Dent, the boldly bearish US economist, is in Sydney this Thursday some two years after last peddling his contrarian forecasts.</p>
<p>His insights alway capture the headlines.</p>
<p>His last seminars advising that Australia’s ‘property bubble’ would burst with a 50 percent price decline actually mimiced his prior forecast from 2011.</p>
<p>The doomsday US commentator sees the world - and most of Australia's multi-dimensional property market - through the prism of his 2011 book, The Great Crash Ahead. There is now a new book to sell.</p>
<p>His 2011 remarks on David Koch’s Sunrise program, saw Dent implore major capital city viewers to sell their homes before the 50% crash in prices arrived on our doorsteps.</p>
<p>Dent’s argument appeared based mostly on the claim that Australian dwelling values were 9.5 times family incomes, and ought in his view, be about half this level. </p>
<p>Not long after a chart released by the RBA showed the Australian house price-to-income ratio was actually around four or five times, ie half Dent’s claims.</p>
<p>Dent refined the 2011 outlook with his colourful analogy that the Australian property market would be like popcorn popping - different markets would be bursting at different times.</p>
<p>Last time Dent was here I asked him on his hit and miss success rate.</p>
<p>"I am likely to get 30 or 40% of forecasts wrong in the timing," he advised.</p>
<p>Dent says he studies bubbles.</p>
<p>"When everyone is in a bubble, most can't see it, when the markets are at their lows, they can't see the recovery...and that's when there is money to be made," he said.</p>
<p>Harry is the founder and senior editor at Dent Research, where he seeks to identify and study demographic, technological, consumer spending and geopolitical trends to forecast economic booms and busts well ahead of the mainstream.</p>
<p>The forecast he his most proud of was when Dent tipped that Japan, then on top of the economic world, would suffer a slowdown lasting more than a decade.</p>
<p>Japan is still pretty much in a coma, he says after its 1991 peak when most economists envisaged Japan overtaking the US in world economic dominance.</p>
<p>Saying it often can be just one piece of information that provides the clue, his late 1980s Japanese forecast was based on his premise that people slow in spending way ahead of retirement, from 46 years onwards.</p>
<p>I asked how much understanding the pysche of the population of a city or country was helpful in understanding property market movement, and he agreed with the concept.</p>
<p>"You are right, yes markets do go up and down together, but to different degrees."</p>
<p>As with many economist naysayers, Dent may get Sydney right sooner or later, but it is best to take the forecasts with a certain level of cynicism or else cop the cost of lost opportunity.</p>
<p>Afterall Sydney's house price median was at $560,000 and Sydney’s unit median at $458,500 around the time of his 2011 forecast.</p>
<p>By 2014 it was $765,000 for Sydney houses and $550,500 for units.</p>
<p>It now sits at $890,000 for houses and $680,000 for units, according to CoreLogic.</p>
<p>It's not to say Sydney won't be spooked sometime, but for most of us it will be a question of holding one's nerve in the face of the herd mentality.</p>
<p>That's more her-like panic likely to come from investors, rather than home owners.</p>
<div> </div>
<div>This article was first published in the Saturday Daily Telegraph.</div>
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No dent to our market - and we've heard it all before from Harry

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<p>House values in Sydney and Adelaide fell 0.1 percent from last week according to CoreLogic RP Data.</p>
<p>Melbourne are up 0.1 percent, Brisbane homes increased 0.2 percent.</p>
<p>House prices in Perth fell 0.5 percent</p>
<p><a href="/images/2016/05/30/Screen%20Shot%202016-05-30%20at%204.30.20%20PM.png" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/05/30/Screen%20Shot%202016-05-30%20at%204.30.20%20PM.png" alt=""></p>
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House values in Sydney, Adelaide fall 0.1 percent from last week : CoreLogic RP Data

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<p>House prices are going nuts again, according to <em>Australian Financial Review</em> columnist Chris Joye.</p>
<p>He noted home values across the five capital cities have expanded 9.8 per cent over the last year with "staggering" 4 per cent capital gains in the past three months alone.</p>
<p>The correction called by so many in late 2015 has been superseded by an elongation of one of the biggest, and certainly most dangerous, house price cycles in history, Joye suggested.</p>
<p>Over the 12 months to mid-May, Sydney and Melbourne prices have leapt by a stunning 12.4 per cent and 12.7 per cent, respectively.</p>
<p>Dwelling values in Brisbane and Adelaide have increased 7.4 per cent and 5.6 per cent over the last year which, according to CoreLogic RP Data, which Joye noted while seemingly modest, is 3.5 and 2.7 times the pace of wages growth.</p>
<p>Joye advised the Reserve Bank of Australia's decision to further crush the cash rate to another record low of 1.75 per cent in May had compelled his upward revision to his 2016 forecasts.</p>
<p>In December his nominal appreciation forecast was of 2 per cent to 4 per cent which assumed an unchanged cash rate. </p>
<p>"Given current yield curve expectations for a second cut in 2016, my central case is house prices run at three to five times wages, which represents capital growth of between 6 per cent and 10 percent.</p>
<p>"We are, therefore, in completely unchartered territory that means the risk of policymaking errors apropos asset price bubbles is higher than it has been before.</p>
<p>"So if you are buying a house, you would be well-advised to embed a chunky margin of error in price terms to hedge against such hazards," said Christopher Joye who is a director and shareholder in Smarter Money Investments, which manages fixed-income investment portfolios.</p>
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Chris Joye says house prices are going nuts again - maybe up by 10 percent

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<div>The government's State of Australian Cities report for 2015 revealed some interesting demographic and social trends.</div>
<div> </div>
<div>The report found that population growth in recent years is becoming increasingly capital city focussed over time, and this is projected to become even more so the case over the next five decades.</div>
<p><a href="/images/2016/05/23/A1.jpg" target="_blank">Click to enlarge</a></p>
<div class="separator"><img src="/images/2016/05/23/A1.jpg" alt=""></div>
<p> </p>
<div>In fact, just the four most populous capital cities plus Gold Coast, Sunshine Coast and a handful of other conurbations have accounted for the overwhelming bulk of population growth. </div>
<div> </div>
<div class="separator"><a href="/images/2016/05/23/A2.jpg" target="_blank">Click to enlarge</a></div>
<div class="separator"><img src="/images/2016/05/23/A2.jpg" alt=""></div>
<div class="separator"> </div>
<div>The other cities and "peri-urban locations" which experienced some population growth were as follows:</div>
<div> </div>
<div class="separator"><a href="/images/2016/05/23/A3.jpg" target="_blank">Click to enlarge</a></div>
<div class="separator"><img src="/images/2016/05/23/A3.jpg" alt=""></div>
<p> </p>
<div>Projecting trends forward, the government expects the capital city share of population growth to continue increasing relentlessly for the next half century, from about two thirds to more than 80 per cent by 2061:</div>
<div> </div>
<div><em>"The majority of Australia's future population growth is expected to occur in and around its capital cities...Australia's population living in capital cities will more than double by 2061".</em></div>
<p><a href="/images/2016/05/23/A4.jpg" target="_blank">Click to enlarge</a> </p>
<p><img src="/images/2016/05/23/A4.jpg" alt=""></p>
<div>The projections show population growth expanding rapidly so that by 2061 several capital cities will have become very large indeed, including Sydney (8.5 million), Melbourne (8.6 million), Brisbane (5.8 million), and Perth (5.5 million).  </div>
<div> </div>
<div>By contrast the respective populations of the smaller cities aren't expected to change all that much in absolute terms. </div>
<p><a href="/images/2016/05/23/A5.jpg" target="_blank"> Click to enlarge</a></p>
<div class="separator"><img src="/images/2016/05/23/A5.jpg" alt=""></div>
<p><br><strong><span style="text-decoration: underline;">House price trends</span></strong></p>
<div>The State of Australian Cities report notes that for regional cities "overall house prices have not recovered strongly since the financial crisis".</div>
<div> </div>
<div>This mirrors quite closely what we have seen in Britain, with house prices rising strongly almost everywhere due to a debt binge broadly from around 2000 to 2008, in Australia's case spurred on by a once-in-a-century mining boom. </div>
<div> </div>
<div>But in most regional markets a long period of stagnation has followed since. </div>
<div> </div>
<div>You don't really need data series to demonstrate this point - just read the personal experiences of property investors on chat forums and their collective frustration is more than evident. </div>
<p><a href="/images/2016/05/23/a6.jpg" target="_blank">Click to enlarge</a></p>
<div class="separator"><img src="/images/2016/05/23/a6.jpg" alt=""></div>
<p> </p>
<div>It's been fairly well documented that house price growth has been strong in the largest capital cities, but house price growth has been far from uniform even within the larger capitals. </div>
<div> </div>
<div>Research conducted on behalf of the Valuer General concluded that price growth continues to be considerably stronger in the suburbs located close to the Central Business District. </div>
<div> </div>
<div><a href="/images/2016/05/23/a7.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/05/23/a7.jpg" alt=""></div>
<p><span>Indeed, research papers by the </span>Reserve Bank of Australia<span> (RBA), </span>AHURI<span> and others have all arrived at the same conclusion.</span> </p>
<div>Concludes the government report:</div>
<div> </div>
<div><em>"Inner urban regions and municipalities such as the Boorondara, inner, northern and eastern statistical districts and the inner Melbourne districts are pulling away from price growth rates of the middle and outer ring regions. </em></div>
<div><em> </em></div>
<div><em>The differences mean residents of outer urban regions are likely to be increasingly constrained in their ability to move to inner regions."</em></div>
<p><a href="/images/2016/05/23/A8.jpg" target="_blank"> Click to enlarge</a></p>
<div class="separator"><img src="/images/2016/05/23/A8.jpg" alt=""></div>
<div class="separator"> </div>
<div class="separator">
<p><span><em>PETE WARGENT is the co-founder of <a href="https://allenwargent.com/" target="_blank" rel="nofollow">AllenWargent</a> property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank" rel="nofollow">blogger</a>.</em><br></span></p>
<p><em>His latest book is <a href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx" target="_blank" rel="nofollow">Four Green Houses and a Red Hotel</a>.</em></p>
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Non-capital house prices have not recovered strongly since the financial crisis: Pete Wargent 

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<p><img src="https://counter.theconversation.edu.au/content/57114/count.gif" alt="The Conversation" width="1" height="1"></p>
<p>GUEST OBSERVER</p>
<p>Like millions of Australians, I am an owner-occupier with a mortgage debt several multiples of our family’s annual household income.</p>
<p>Having bought in the last five years, I am on several Estate Agent’s email lists. This week past, I was accordingly surprised to receive an email from one of these Agents. The email concerned negative gearing, in 2016 a live election issue. It advocated against changing the existing policy, accordingly a vote for the incumbent government.</p>
<p>Australia is a democracy, and it is a privilege individuals and groups enjoy to be able to advocate for what policies they please. We are also a market economy, in which private interests are encouraged to pursue their private good within the limits of the Law.</p>
<p>Nevertheless, such direct advocacy by an Industry to its clients and everyone who will listen of one of the two major Parties' platforms is still novel or unusual. A precedent was set by the Mining Industry’s $22 million opposition to the Superprofit’s Tax.</p>
<p>Wise policy-making in a democracy or “common-wealth” should consider all the different interest groups affected, and different voices in the mix. It should orient itself towards a balanced, inclusive assessment of the general, as well as particular—and the medium and long-term, as well as short-term—good.</p>
<p>So let me put some considerations the email did not raise.</p>
<h2>Some things the email did and did not raise</h2>
<p>This email’s positive argument was familiar to anyone who follows the news cycle in Australia.  Negative Gearing is the ability of investors to claim any moneys lost on an investment property as reduced taxable income.</p>
<p>This effective subsidization of property investment may or may not have artificially inflated property prices by artificially boosting demand. This wasn’t mentioned.</p>
<p>Negative gearing may or may not place first home buyers aiming to own and occupy their little piece of Australia, against investors or consortiums buying 2nd, 3rd, or 4th properties, with much greater acquired wealth, economic capacity and even—with Negative Gearing—an artificial incentive to take on greater mortgages, but no intention to live on the property. This also was passed over.</p>
<p>But negative gearing stimulates property investment. And more investment properties means more rental properties. This keeps rental prices down. The beneficiaries of negative gearing are thus not only wealthy investors or developers, despite first appearances. The policy also benefits the (growing) 30 percent or so of Australians who presently rent: mostly the younger and least wealthy. It is an exercise in “equity”, as well as wealth creation.</p>
<p>Higher property prices also bring higher commission yields to Real Estate Agents. This was also not mentioned in my email.</p>
<h2>The house prices (and unprecedented household debt) in the room</h2>
<p>Also unmentioned were several relevant, larger pieces of economic information which affect how we should assess the wisdom of negative gearing, reintroduced by the ALP under Hawke-Keating in 1987.</p>
<p>By any accepted measure, the period of negative gearing in Australia has coincided with extraordinary rises in property prices. They have risen at disproportionate rates relative to the consumer price index. They have risen disproportionately relative to the median income.</p>
<p>In the year 1975 in which I, a Gen-Xer, was born, the average house price in Sydney was $28000.  To put things in perspective, the average Australian earned something just shy of $8000 in that turbulent year.</p>
<p>By early 2015, the median Australian income had become $72000, something like a tenfold increase, reasonably closely tracking the increase in the prices of most consumer goods.</p>
<p>House prices have however multiplied by something around thirty times in Sydney, Melbourne, Adelaide and Perth, and over twenty times in the other capitals.</p>
<p>In February of 2015, the average house price in Sydney came in at around $850000, well over ten times median annual income; Melbourne’s median house price (where we earn a bit less, to be fair) was about $615000.</p>
<p>As of August last year, Australian homes rated the third-least affordable of OECD countries. Only New Zealand, our neighbours across the ditch, and Canada, our commonwealth cousins North of our closest allies, have a higher house-price-to-income ratio.</p>
<p>The US itself suffered a grave financial crisis in 2007-2008 initially triggered by large numbers of defaults on household mortgages.</p>
<p>As of the turn of this year, some authorities suggest we have the second least affordable homes anywhere, following only Hong Kong.</p>
<p>So Australia is not alone in enjoying a property boom of historic proportions. Other countries have experienced broadly comparable rises in the price of property as against income and other consumer items.</p>
<p>Nevertheless, the rise of capital city house prices in the last four decades, as of last year,<a href="https://www.theguardian.com/business/2016/jan/15/how-australian-households-became-the-most-indebted-in-the-world"> </a>pushed Australia past Denmark as the most privately indebted nation, with a ratio of 123.08% debt to GDP. The International Monetary Fund (IMF), hardly crusted-on Labor voters anywhere, sent an economic team to Australia to examine “the risks posed by property speculation and record-high household debt as part of a broad health check-up of the sagging domestic economy.”</p>
<p>We Australians love a winner, and it is an Olympic year. But we should take no pride in the fact that, reaching the podium for a bronze in income-house-price ratios, we presently take the gold in private household debt.</p>
<h2>X’s, Y’s, booms and boomers</h2>
<p>Public debate around elections turns largely around budgets—what the government does with the money we provide the state in taxation, and who, how and what the government taxes or subsidizes. Less debate has turned over several recent elections on how Australia is now, after two decades of celebrated economic growth—and after a decade of being the economic envy of many another country globally—the most “negatively geared” population in the world.</p>
<p>But perhaps, since the ALP, Mr Turnbull and the Real Estate industry have made negative gearing an issue of public debate, now is the time we should be talking more—if not for our own sakes, then for those of the next generations. For the distribution of the household debt burden between different age and income groups is also not cause for celebration, alongside extant intergenerational data concerning who owns what in the lucky country.</p>
<p>Let me explain what I mean.</p>
<p>Since owning property requires greater wealth, everywhere the young and the less wealthy own less and, if this is possible (it hasn’t always been), lend more. The young have not had the time to accumulate wealth; the poor have had the time, but not the ability, opportunity or fortune.</p>
<p>There is nevertheless something historically exceptional about the present Australian situation. Anyone my age or younger, particularly those of us who teach and talk with Yers and “Nexters”, will know the frank resignation many young Australians feel about ever being able to own their own cut of the pie, except through aid from their parents.</p>
<p>As a Gen-Xer, I belong to the most indebted generation (35 to 44 year olds), when it comes to mortgages ($140000 average, as of 2011-12, including the growing proportions of us who do not own a house to be paying back). But my generation is followed by the Gen-Yers, 25 to 34 years (c$110000 average, for the same period). The Nexters must wait their turn.</p>
<p>In 1981<a href="https://grattan.edu.au/wp-content/uploads/2014/03/800_Renovating_Housing.pdf">,</a> more than 60 per cent of 25 to 34 year olds owned their own home in this country. By contrast, by 2011, only 48 per cent did so. The decline over the same period was 10 percentage points for those aged 35 to 44, from 75 percent to around 65 percent.</p>
<p>Home ownership rates stayed relatively stable only for Australians over 55 (born before 1960) in the decade of 2003-2013. In contrast to their children and grandchildren, the baby boomers remain the principal beneficiaries of the property boom.</p>
<h2>We’re all in this together</h2>
<p>Negative gearing is not solely responsible for this growing gap between income and house prices, Australia’s global leadership in household debt, and as such, the growing intergenerational wealth gap. The increased availability of credit, continually low interest rates, continuing population growth, and other factors have also contributed.</p>
<p>Illustrating all the old gags, economists disagree as to the effects of ending the regime of negative gearing in Australia. There will foreseeably be some decline in property investment, relative to other possible markets for capital. This may, in the shorter term, affect the availability of said properties to renters. Thus rental price increases are likely, at least in the short term.</p>
<p>But how steep the investment decline and how high the rental rise is debatable, should negative gearing be rolled back. Also debatable is how long these effects would last before the interconnected rental and ownership markets rebalance themselves.</p>
<p>Any such negative effects, that is, should be balanced against the effects removing negative gearing would have in moderating the rise and rise of Australian house prices relative to income. These are effects which will be relevant not only to Mr Turnbull’s “largest asset class”<a href="https://www.propertyobserver.com.au/https://www.abc.net.au/news/2016-05-13/real-estate-industry-attacks-labor's-negative-gearing-policy/7412458">,</a> in whose name he has called down havoc on Mr Shorten’s “reckless and dangerous experiment”. They will also have impacts for the next generations, increasingly a class or classes with a longer future and fewer assets.</p>
<p>Most Australian parents I wager would prefer that the around $100-200,000 their child will spend in renting in a capital city throughout their twenties would go to paying down a mortgage of their own in the suburbs, rather than paying down the mortgage on someone else’s investment—particularly an investment whose losses (above what their child’s rental outlays pay down) are deducted from the investor’s taxable income.</p>
<p>They would also rather that when their child and her/his partner wishes to bid at auction for their own small place in the housing market, they were not competing with investors who already have theirs; who have no intention of living in this new property; and who, to boot, intend to claim any costs unmet by rental income as the means to minimize their tax share.</p>
<p>So boomers too, who are also parents and grandparents, have compelling reasons to listen to more voices on this issue than the Real Estate lobby.</p>
<h2>Future proofing</h2>
<p>One of the stronger criticisms of electoral democracy is that, by focusing politicians on winning the next three-four year term, it blinds deliberation to longer term trends and problems. In complex economies like Australia’s, increasingly intertwined with global economic forces, many trends that shape the way we live, the prices of our goods and availability of our services develop over decades.</p>
<p>The property boom, relative to income, and accompanied by unprecedented private Australian debt, is not the product of Mr Turnbull’s term in government, nor of Mr Abbott’s, nor Rudd-Gillard-Rudd’s, or even Mr Howard’s economic miracles.</p>
<p>It takes courage to challenge such a three-decade policy with so many beneficiaries. “Whatsoever is new is unlooked for; and ever it mends some, and [im]pairs others”, someone said. For “what is settled by custom, though it be not good, yet at least it is fit.” But just as the institution of negative gearing has aided some, it has impaired the young, and solely-wage-earning Australians who typically earn less than others, but must be taxed on it all.</p>
<p>Just so, by scrapping negative gearing, we shall be impairing investors and Real Estate agents, but aiding the next generations of Australians. At worse, if rental prices do rise, this will provide an incentive for the young to enter the property market earlier, bucking existing inequitable trends.</p>
<p>Scrapping negative gearing may help avoid a more damaging “correction” in property prices that more bearish commentators have long been prophesying, and the IMF felt concerned enough about to come visiting down under.</p>
<p>For by scrapping negative gearing, make no mistake about it, any new government shall be making a small step towards reducing Australian house prices. This, and its effects on their commissions, is the red raw motive behind the Real Estate lobby’s wounded advocacy.</p>
<p>But looking forwards, at some point Australia is going to have to confront the growing wealth disparity between the generations, and the gap between what people earn and what they owe. While it is just that older people be rewarded for their labours, this consideration needs to be balanced against the right of younger generations to feel like they can and do own a stake in the commonwealth, rather than facing longer and longer periods of paying down others’ mortgages or world-leading mortgages of their own.</p>
<p>So a vote against negative gearing, no matter which Party proposes it, is a vote to minimize the increasingly huge debt burden the younger generations need to take on to own, if not their quarter-acre block, then a quarter of the land most middle-class Australians could comfortably afford two generations ago.</p>
<p>Just as the email said, this is urgently important.</p>
<p>Matthew Sharpe is associate professor in Philosophy, Deakin University and author for The Conversation. He can be contacted <a href="https://theconversation.com/profiles/matthew-sharpe-125260" target="_blank">here</a>.</p>
<p> </p>
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Negative gearing not solely responsible for growing gap between income and house prices

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<p>The pace of capital gains rebounded from the relatively flat numbers recorded in March, with dwelling values increasing by an average of 1.7 percent across the CoreLogic RP Data combined capitals’ index.</p>
<p>The latest figures now take the combined capital city dwelling values measure 3.3 percent higher over the first four months of 2016.</p>
<p>Across the country, housing market trends remain mixed, however, CoreLogic RP Data research director Tim Lawless noted that the improvement in the rate of capital gains has been ‘broad-based’ during 2016 with every capital city except Perth recording a lift in dwelling values over the calendar year to date.</p>
<p><a href="/images/2016/05/02/Screen%20Shot%202016-05-02%20at%2011.18.13%20AM.png" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/05/02/Screen%20Shot%202016-05-02%20at%2011.18.13%20AM.png" alt=""></p>
<p>“The results show value growth moved at a faster pace compared with the final three months of 2015 when capital city dwelling values slid 1.4 per cent lower off the back of weaker market conditions in Sydney and Melbourne.</p>
<p>“While we’ve seen capital gains moderate substantially after peaking last year in Sydney and Melbourne, dwelling values continue to trend higher, just not as fast.</p>
<p>"The annual rate of growth in Sydney peaked at 18.4 percent in July last year and has since moderated back to slightly less than half the peak rate of growth, at 8.9 percent over the most recent twelve month period,” Mr Lawless said.</p>
<p>Melbourne’s housing market continues to show a level of resilience to a slowing trend, however the annual growth rate has fallen from a recent peak of 14.2 percent to the current annual growth rate of 10.1 percent; Melbourne was the only capital city to see double digit growth over the past twelve months.</p>
<p>Perth and Darwin remain as the only two capital city markets to experience a decline in home values over the past twelve months, with Perth values down 2.1 percent and Darwin values 3.7 percent lower.</p>
<p>“With recent month-on-month increases in home values in these two cities, the declining trend rate is now levelling.</p>
<p>"This may be an early sign that these markets are beginning to find their cyclical trough after more than a year of annual declines.”</p>
<p><a href="/images/2016/05/02/Screen%20Shot%202016-05-02%20at%2011.20.46%20AM.png" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/05/02/Screen%20Shot%202016-05-02%20at%2011.20.46%20AM.png" alt=""></p>
<p>Over the current growth cycle, which commenced broadly in June 2012, capital city dwelling values have moved 34.4 percent higher, led by a 52.7 per cent rise in Sydney home values, and a 37.1 percent lift in Melbourne values.</p>
<p>Brisbane experienced the third highest rate of dwelling value growth over the growth cycle to date; dwelling values in the city are now up 18 percent. </p>
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Dwelling prices rise for fourth consecutive month in April: CoreLogic RP Data

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<p><span>The list of the most exclusive suburbs in each state reiterates just how much more expensive real estate is in Sydney relative to the rest of the country.</span></p>
<p><span>Sydney is by far and away the nation’s most expensive housing market. To put this into some perspective we have looked at the top decile of selling prices over the three months to January 2016. A decile simply divides a group into ten equal parts. What this means is if there were 20 sales over the three months and we lined the sales up from lowest to highest we would take the 18th price as a representation of the most expensive segment of the market.</span></p>
<p><span>Over the three months to January 2016, the 90th percentile price of a house in the city was $1.5 million and the 90th percentile unit price was $980,000.  Over the same period, the two capital cities with the next highest 90th percentile house price was Melbourne at a still high but much lower $1,050,000.  This highlights just how much more expensive housing is in Sydney and to a lesser degree Melbourne is relative to other capital cities.  As an example the next highest 90th percentile price is Perth at $870,000.</span></p>
<div>
<h3>90th percentile price of houses and units 3 months to January 2016</h3>
<p><a href="/images/2016/04/15/2016-03-21--img1.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/04/15/2016-03-21--img1.jpg" alt=""></p>
<p>There is also a large difference between the cost of premium housing in capital cities and non-capital cities.  The 90th percentile house price across the combined capital cities is $1,010,000 compared to $675,000 in combined regional markets.  Similarly, 90th percentile unit prices are $830,000 in the combined capital cities compared to $600,000 outside of the capitals.  This data points to the fact that non-capital city areas are the great un-tapped resource for more affordable housing.  Of course employment opportunities in these areas are the main factor holding back the regional areas of the country.</p>
<p>The table below highlights the five most expensive suburbs for both houses and units in each state.  The data is based on median values and we have only included suburbs that had at least 10 sales over the 12 months to January 2016.<br><br></p>
<h3>Suburbs with most expensive median values, January 2016</h3>
<p><a href="/images/2016/04/15/2016-03-21--img2.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/04/15/2016-03-21--img2.jpg" alt=""></p>
<p>The Sydney premium becomes very evident when we look at the most expensive suburbs in each state based on median values.  The data shows the 5 most expensive suburbs for houses in NSW (all of which are in Sydney) all have a median value of more than $4 million.  In comparison, the most expensive suburbs for houses in Vic and WA are more than $3 million, in SA it is more than $2 million, in Qld, NT and ACT it is more than $1 million and in Tas it is less than $850,000.</p>
<p>Similarly for units, all of the 5 most expensive suburbs in NSW (Sydney) have a median values of more than $1 million.  Tennyson in Brisbane is the only other suburb outside of Sydney with a median unit value of more than $1 million.</p>
<p>There is a large premium for housing in our largest city.  Of course the city also has an abundance of waterfront homes which contributes to the higher overall cost of housing.  While employment opportunities remain significant in Sydney and employers limit the opportunities for workers to work remotely we would expect that a substantial Sydney premium will remain.  Elsewhere housing is generally much more affordable but of course not everyone has a choice when it comes to potentially leaving Sydney and heading to another area of the country where housing is cheaper.</p>
<p><em>Cameron Kusher is research analyst for CoreLogic RP Data. You can contact him <a href="https://blog.corelogic.com.au/about/">here</a>.</em></p>
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