Repeat buyers are one of the strongest measures of confidence in any apartment development.

At <a href="https://www.apartments.com.au/new-apartments/era-newcastle-west-124-126-bull-street-newcastle-west-nsw-2302">ERA</a> in Newcastle West, some purchasers are returning to <a href="https://www.apartments.com.au/developers/gwh">GWH</a> after living at the developer's One Apartments. Their decision to purchase again was driven by the quality of life they found after moving into their first GWH home.

Keith Wilton had spent years living in a house in East Maitland before deciding it was time for a change. Apartment living had always been on his radar, but he was selective about what he wanted.

<iframe allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" allowfullscreen="" frameborder="0" height="315" referrerpolicy="strict-origin-when-cross-origin" src="https://www.youtube.com/embed/FH_1EzB-1vs?si=XScVlP1ERsTDJoME" title="YouTube video player" width="560"></iframe>

"I had some boxes I wanted to tick," he says.

Keith points to the open-plan design, generous outdoor areas and considered inclusions as key reasons One Apartments worked for him.

“One of those things was a nice indoor open plan area, but also I wanted a nice outdoor open area that I could entertain on in summer or Christmases or birthdays,” he says.

He also found value in the smaller details, from integrated appliances to shared resident spaces including the pool, cinema and rooftop areas.

[smartcode_project:default project_id=135096 project_image_fid=356818]

After comparing several developments, he chose One Apartments because of GWH's longstanding local reputation and his own experience working with the developer on a commercial project more than a decade earlier.

"I knew that they were local, that the quality of the build was going to be up there. I'd looked at other apartment complexes around and close by, and I just knew that here was a better decision location wise."

Today, Keith says the move has completely changed how he experiences Newcastle.

"I enjoy living in this location because it's more of a lifestyle change. That Newcastle city living where you can walk to restaurants and bars and even beaches and parks and even shopping across the road."

[smartcode_project:default project_id=135096 project_image_fid=356828]

Beyond the location, he says it's the sense of community that has surprised him most.

"Everyone loves living here because they chose to live here, but everyone looks out for each other. It's a real great community feel here."

For Aimee and Lyle Goodman, the journey started almost by chance.

<iframe allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" allowfullscreen="" frameborder="0" height="315" referrerpolicy="strict-origin-when-cross-origin" src="https://www.youtube.com/embed/tsioMLcnjas?si=zq-ys3JuWpfa5hFv" title="YouTube video player" width="560"></iframe>

The couple happened to be having coffee in Newcastle when they noticed the site where One Apartments was about to begin construction.

"We were aware GWH was planning a development," Aimee says. "We made one phone call and things moved pretty quickly after that."

As busy business owners, they initially thought apartment living would simply reduce the maintenance that came with larger homes. Instead, it fundamentally changed how they spent time together.

"We actually catch up more as a family now," Aimee says.

"We've had homes with big yards and lots of space, but everyone ended up in different rooms. Here we'll have dinner together, the kids can play, and we spend far more quality time together."

[smartcode_project:default project_id=135096 project_image_fid=356829]

Lyle says their confidence came from GWH's reputation within Newcastle's building industry.

"I know people who've worked across different apartment projects, and whenever GWH came up the feedback was always the same. They're rock solid. They're quality."

That confidence only grew throughout the buying process.

"One of the things that really impressed us with GWH was the whole process, was the communication," Lyle says. "It was consistent, it was regular, there was no problem if we had some weird questions, there was no problems in getting answers."

[smartcode_project:default project_id=135096 project_image_fid=351104]

Aimee says one moment stood out.

"The project actually finished on time. We realised we needed to hurry up and sell our house because everything was happening exactly when they said it would."

The positive experience at One Apartments ultimately gave all three buyers the confidence to purchase again with GWH, this time at ERA.

Their confidence reflects what many buyers are seeking in today's apartment market. Location remains important, but so too does certainty around delivery, quality and long-term liveability.

[smartcode_project:default project_id=135096 project_image_fid=356822]

ERA builds on those foundations with 280 one, two and three-bedroom apartments across two landmark towers in <a href="https://www.apartments.com.au/developments/newcastle-west-nsw-2302">Newcastle West</a>.&nbsp;

Designed by <a href="https://www.apartments.com.au/architects/fk-australia">Fender Katsalidis</a>, the project will include more than 2,000 square metres of resident amenities, including a resort-style pool, gym, sauna, private cinema and rooftop entertaining spaces overlooking the harbour and coastline.&nbsp;

The development is also within walking distance of the Newcastle Interchange, Honeysuckle, Darby Street, the harbour foreshore, restaurants, retail and the city’s beaches, continuing the walkable lifestyle that existing GWH buyers say has transformed how they live.

[smartcode_project:default project_id=135096 project_image_fid=356826]

For Keith, the appeal remains straightforward.

"You feel at home even before you've moved into your home."

For Aimee, the change is measured in time.

“I just felt like I had more time,” she says.

[smartcode_project:default project_id=135096 project_image_fid=351102]

Construction at ERA is now underway, with more than half of the residences already sold and limited two and three-bedroom apartments remaining in the East Tower release. Priced from $980,000 for two-bedroom residences and $1.46 million for three-bedroom residences, buyers can secure an apartment with a 10 per cent deposit, with premium homes offering ocean views from Level 8 and harbour views from Level 10.

ERA is also backed by Resilience Insurance's 10-year Latent Defects Insurance policy, providing protection against structural or waterproofing defects for 10 years after completion. The project is anticipated to be completed in early 2028.

[smartcode_project_cta:default project_id=135096]

Joel Robinson

From ONE to ERA: Why buyers are choosing GWH again in Newcastle West

Virgate Property Group is preparing to commence construction of Verdé, its new apartment development in Melbourne's Arts Precinct at Southbank, following a strong run of sales that has seen more than half of the project's 173 apartments secured.

Verdé has attracted a broad mix of first home buyers, owner-occupiers upgrading from nearby inner-city suburbs and investors, with younger owner-occupier couples aged between 28 and 45 accounting for the strongest enquiry. Many are already living in Southbank, South Melbourne, Albert Park, Port Melbourne, South Yarra and the CBD.

"Verdé is located in one of the most desirable pockets of southern Melbourne," Blair Property Group Director Darren Blair, who is managing sales at Verdé, said.

"It's within walking distance of the Arts Centre, Royal Botanic Gardens, Albert Park Lake, and Southbank's restaurants and retail. It's a great lifestyle location with strong amenity and liveability, which made it a very attractive choice for the project."

[smartcode_project:default project_id=4661 project_image_fid=372549]

Virgate was already familiar with the precinct, having previously delivered the successful Domain House development in neighbouring South Melbourne. That experience gave the developer confidence to acquire the Coventry Street site and continue expanding its presence in Melbourne's inner south.

"We had been keeping an eye on the site and the broader precinct for a few months before deciding to move forward with the acquisition," Virgate said.

The project was ultimately secured in 2020 following feasibility studies, planning assessments and due diligence, with the brief centred on delivering "a high-quality, considered design that feels both refined and fit for purpose."

[smartcode_project:default project_id=4661 project_image_fid=314259]

Designed by <a href="https://www.apartments.com.au/architects/bruce-henderson-architects">Bruce Henderson Architects</a>, Verdé comprises 173 one, two and three-bedroom apartments priced from $599,000. The architecture is distinguished by a faceted glass façade that responds to both the site's outlook and Melbourne's changing light conditions.

According to Bruce Henderson Architects, the coloured glazing gives the building a distinctive identity while also providing privacy and solar shading, with residences oriented to capture views across the bay, city skyline and surrounding parklands.

Inside, <a href="https://www.apartments.com.au/interior-designers/designoffice">DesignOffice</a> has created interiors focused on natural light, efficient planning and enduring materials. Apartments feature engineered oak flooring, natural stone benchtops, floor-to-ceiling glazing and SMEG appliances, while a restrained material palette aims to complement the expansive outlooks rather than compete with them.

[smartcode_project:default project_id=4661 project_image_fid=372550]

Resident amenity has also been designed around everyday functionality rather than occasional use. Facilities include a concierge-serviced lobby, residents' lounge with fireplace, library and co-working space, gym, terrace garden with barbecue facilities, ground-floor café, and package delivery management.

The project's location continues to be one of its strongest drawcards. Positioned on Coventry Street, Verdé sits within walking distance of the National Gallery of Victoria, Arts Centre Melbourne, Royal Botanic Gardens and Albert Park Lake, while Southbank's dining precinct, Sturt Street trams and the new ANZAC Station are all nearby. The surrounding education catchment also includes Melbourne Grammar, Melbourne Girls Grammar, Mac.Robertson Girls' High School and several major university campuses.

The sales team says buyers have responded particularly well to the combination of location, design quality and long-term liveability.

"They're responding really positively to the quality of the design, premium resident amenities and the uninterrupted views. Many also appreciate the location and how connected it is to everything they need."

The ability to secure stamp duty savings before completion has also been a key factor for purchasers, alongside the opportunity to personalise finishes ahead of settlement.

With construction set to commence soon and more than half the apartments already sold, Verdé enters its next phase as one of the Arts Precinct's more established apartment developments, offering remaining buyers an opportunity to secure a residence before construction advances further. Expected completion is scheduled for late 2027.

[smartcode_project_cta:default project_id=4661]

Virgate's Verdé Southbank moves toward construction as sales fly past halfway stage

Downsizer-focused apartment development Kooyongkoot in Hawthorn has been recognised at the 2026 Better Future Melbourne Design Awards, taking home Gold and Silver awards in two categories.

<a href="https://www.apartments.com.au/new-apartments/kooyongkoot-hawthorn-1-kooyongkoot-road-hawthorn-vic-3122">Kooyongkoot</a>, currently being delivered by developer PQD and designed by Cera Stribley, received Gold in the Interior Design – Proposed category and Silver in the Architecture – Proposed category.

The dual recognition reflects the design approach behind the boutique development on prestigious Kooyongkoot Road, where the focus has been on creating homes for downsizers seeking the space, quality and functionality of a detached house within a low-rise apartment building.

Rather than maximising apartment numbers, <a href="https://www.apartments.com.au/developers/pqd">PQD</a> and <a href="https://www.apartments.com.au/architects/cera-stribley-architects">Cera Stribley</a> limited the development to just 18 residences, allowing for larger floorplans, greater privacy, generous landscaping and expansive communal spaces.&nbsp;The majority of the apartments also benefit from corner aspects, allowing for dual sources of natural light.

Now around 70 per cent complete and on track for completion in November 2026, Kooyongkoot will comprise a mix of garden residences, ter​race apartments, sub-penthouses, and is crowned by two half-floor penthouses with direct lift access and private rooftop terraces.

[smartcode_project:default project_id=102717 project_image_fid=355297]

The Silver Award for Architecture recognised the way the building responds to its prominent corner position at the ent​rance to Hawthorn's Scotch Hill precinct, one of Melbourne's most established residential neighbourhoods.

Rather than competing with the grand homes that line Kooyongkoot Road, the architectural approach focused on restraint and longevity, using curved brickwork, generous landscaping and carefully considered proportions to integrate with the existing streetscape.

"The form feels fluid and timeless, as though shaped by the landscape itself – architecture that belongs, rather than competes," said Chris Stribley, Co-Founder and Managing Principal of Cera Stribley.

The judging submission also highlighted practical innovations throughout the building, including lift cores servicing only nine homes each, a central landscaped lightcourt designed to bring daylight and ventilation into the building, and fully enclosed private storage rooms with lighting, power and shelving to better accommodate residents transitioning from larger family homes.

[smartcode_project:default project_id=102717 project_image_fid=355293]

The Gold Award for Interior Design recognised the project's focus on long-term liveability rather than display-home aesthetics.

According to the awards submission, the interiors were designed from the inside out, prioritising how homes would function over decades of daily use through generous proportions, practical storage, durable natural materials and flexible layouts.

The specification includes natural stone throughout, upgraded acoustic glazing, V-ZUG appliances and fully enclosed storage rooms, alongside an amenity offering focused on wellness, entertainment and everyday convenience.&nbsp;

Residents will have access to a gym and yoga studio, a wellness centre featuring traditional and infrared saunas, a cold therapy shower and treatment room, as well as a residents' lounge and golf simulator/cinema room for entertainment.&nbsp;Kooyongkoot has also considered the everyday convenience of its residents by offering a private carwash and pet wash facilities on site as well as dedicated parcel lockers and oversized fully enclosed storage rooms.&nbsp;

[smartcode_project:default project_id=102717 project_image_fid=355303]

The project's attention to detail has already resonated with buyers. Earlier this year, Kooyongkoot recorded one of Boroondara's highest apartment sales when an $8 million penthouse was purchased by a Melbourne CEO downsizing from a nearby family home.

"Every detail feels deliberate, from the overall design down to the smallest touches," the purchaser said.

"The level of quality and refinement is exceptional, but what really sold it was how liveable it felt... It felt like a place where everything had been considered, not just a luxury building."

[smartcode_project:default project_id=102717 project_image_fid=355304]

Sustainability also formed a key part of both award submissions. Kooyongkoot is targeting a minimum 7.5-star NatHERS rating across all residences, supported by passive design principles, high-performance glazing, EV charging infrastructure, water reuse systems and a wellness model focused on lower-energy dry facilities rather than pools and large wet areas.

Located within walking distance of Scotch College, Methodist Ladies' College, Koo​yong Lawn Tennis Club, Aubur​n Village and Camberwell Junction, Kooyongkoot continues to target owner-occupiers looking to remain in Melbourne's inner east without compromising on space or quality. A limited selection of two, three and four-bedroom residences remains available, with prices starting from $1.9 million.

[smartcode_project_cta:default project_id=102717]

Kooyongkoot wins Gold and Silver at Better Future Melbourne Design Awards

New apartment supply has become increasingly constrained across <a href="https://www.apartments.com.au/developments/parramatta-nsw-2150">Parramatta</a> in recent years, with fewer projects progressing through to completion as development conditions have become more challenging.

It makes <a href="https://www.apartments.com.au/developers/novm">NOVM</a>'s 2021-completed <a href="https://www.apartments.com.au/buildings/the-lennox-parramatta-12-phillip-street-parramatta-nsw-2150">The Lennox</a> one of the most recently completed residential towers on the Parramatta River, and among the newest apartment developments in Sydney's second CBD.

With the project largely completed before the sharp escalation in construction costs and inflation following the pandemic, The Lennox is now offering pricing that would be difficult to replicate in a comparable new development in Parramatta today, or across much of Western Sydney.

The majority of the 413 apartments at The Lennox sold before and shortly after completion. A limited release of the remaining apartments has recently been brought to market by capital partner <a href="https://www.apartments.com.au/project-marketer/equitifund-group">Equitifund</a>, with entry-level pricing from $700,000 and two-bedroom apartments available from under $1 million.

Rising above the Parramatta River at 12 Phillip Street, The Lennox comprises one, two, three and four-bedroom apartments, appealing to first home buyers, young professionals, families, downsizers and interstate investors seeking a completed apartment in one of Australia's fastest-growing economic centres.

[smartcode_project:default project_id=5743 project_image_fid=372394]

Rather than positioning Parramatta as an alternative to Sydney's CBD, Equitifund believes the city has reached a point where it stands on its own merits.

"Parramatta is no longer simply an alternative to Sydney CBD, it's becoming a destination in its own right," Equitifund Executive Chairman Greg Huxley said.

"The Lennox captures that evolution with a level of quality and amenity that's difficult to match at its price point."

[smartcode_project:default project_id=5743 project_image_fid=953]

Designed by <a href="https://www.apartments.com.au/architects/marchese-partners">Marchese Partners</a>, the tower responds directly to its riverfront setting through expansive glazing and open-plan layouts that maximise views across the Parramatta River and city skyline. Interiors feature engineered timber flooring, stone benchtops, stainless steel appliances and floor-to-ceiling glazing, while generous balconies extend the living spaces outdoors.

Marchese Partners says the project was conceived to balance high-quality apartment living with practical, long-term functionality, pairing larger, efficient floorplans with amenities more commonly associated with five-star hotels.

That emphasis continues through the resident facilities, which include a 20-metre rooftop swimming pool, fully equipped gym and wellness spaces, full-time concierge, a residents' lounge, function room, private lifts, secure basement parking and rooftop communal areas overlooking the Parramatta River. Ground-floor boardwalk retail and dining further activate the riverfront and integrate the building into the surrounding public realm.

[smartcode_project:default project_id=5743 project_image_fid=925]

Australian housing and finance group Equitifund has secured the remaining apartments, believing there are few completed apartment opportunities in Parramatta that offer the same combination of location, amenity and pricing.

Equitifund National Sales Director Ben Hamblett says buyers are increasingly recognising that premium apartment living no longer needs to come with Sydney CBD pricing.

"The Lennox is where aspirational living becomes attainable," Hamblett said.

"Wake to river and mountain views, step into Sydney's Second CBD, and arrive home to resort-calibre amenities, all without the harbour price tag."

Hamblett says owner-occupiers are also attracted by the convenience of having Westfield Parramatta, Church Street's dining precinct, Parramatta Park, Riverside Theatres, Western Sydney University and major transport connections all within walking distance.

"At The Lennox, lifestyle is not an afterthought, it is the foundation."

[smartcode_project:default project_id=5743 project_image_fid=5374]

The Lennox places residents within walking distance of Parramatta Square, Westfield Parramatta, Church Street Eat Street, Parramatta Station, the ferry wharf, Light Rail, the future Sydney Metro West, Parramatta Park and CommBank Stadium, reinforcing Parramatta's position as one of Australia's most connected metropolitan centres outside Sydney's CBD.

Equitifund says buyers visiting the display suite consistently comment on the quality of the finishes, generous floorplans, river and skyline views, and the walkability of the location. The project has attracted a broad mix of local professionals, upsizers, downsizers, buyers relocating from Sydney's inner suburbs and interstate investors seeking long-term growth opportunities.

That demand aligns with Parramatta's continued evolution as an economic powerhouse. Equitifund Research and Market Insights specialist John Bekiaris says sustained population growth, infrastructure investment and expanding employment opportunities continue to support long-term housing demand across the city.

"Parramatta has evolved from a satellite city into one of Australia's most important economic centres. Population growth, infrastructure investment and employment are all supporting sustained long-term housing demand."

[smartcode_project_cta:default project_id=5743]

The apartment price gap drawing Sydney buyers west

A luxury beachfront apartment at Rainbow Bay has more than doubled in value since it sold off the plan six years ago, setting a new local apartment record in the process.

The three-bedroom apartment in the Flow development on Petrie Street, the first of four new projects locally by Paul Gedoun's S&amp;S Projects, has sold for $7.4 million, after originally selling for $3.27 million when the project launched in 2020.

The seventh-floor apartment, comprising 187 sqm of internal living space and a 54 sqm balcony overlooking Froggies Beach and Snapper Rocks, was purchased by a local family.

The transaction was negotiated by Pezet Matheson director Kerry Pezet and equates to more than $30,000 per sqm.

Pezet said the sale reflected the limited opportunities to buy into the boutique beachfront development.

"The sale highlights the rarity of opportunities within the boutique beachfront development, where residences seldom become available," Pezet said.

"Flow is one of the Gold Coast's most tightly held buildings. Buyers from our database move quickly when residences become available, and achieving an off-market sale at $7.4 million demonstrates the depth of demand for property of this calibre."

<img alt="Flow" data-entity-type="file" data-entity-uuid="c585b206-2130-4eee-a50c-3f27c51a7c70" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-06%20at%208.33.25%E2%80%AFPM.png?VersionId=m3pHRDV62Y3fvN.XQuQHq.52ilTWpRLf" />

Flow was the first of four luxury apartment developments delivered by Paul Gedoun's S&amp;S Projects at Rainbow Bay and was completed in 2023.

Positioned on the beachfront overlooking Snapper Rocks, the residence includes three bedrooms, three bathrooms, a powder room and views stretching north along the coastline towards Surfers Paradise.

Pezet Matheson Residential principal Mitchell Lambert said buyers continued to prioritise quality beachfront apartments in tightly held locations.

"Flow Residences offers a rare combination of elevated beachfront positioning, architectural excellence, comprehensive resident amenity and premium finishes, which is exactly what discerning purchasers are seeking," Lambert said.

"The transaction further reinforces Rainbow Bay's reputation as one of Australia's premier coastal lifestyle destinations, where limited supply and growing demand continue to support strong market performance."

Pezet Matheson originally marketed and sold out Flow off the plan, making the latest transaction a return to one of the project's original buyers.

Paul Gedoun is selling his third project, <a href="https://www.apartments.com.au/new-apartments/radia-rainbow-bay-271-boundary-street-coolangatta-qld-4225">Radia Rainbow Bay</a>, after recently completing, and selling out, <a href="https://www.apartments.com.au/buildings/esprit-217-227-boundary-street-coolangatta-qld-4225">Esprit</a>. He has plans for a <a href="https://www.apartments.com.au/news/qld/first-look-s-s-projects-proposes-88-apartment-wellness-tower-at-coolangattas-boundary-street">fourth building</a>, 88 apartments on <a href="https://www.apartments.com.au/new-apartments/209-213-boundary-street-coolangatta-qld-4225">Boundary Street</a>.

Rainbow Bay apartment doubles in price since off the plan sale during pandemic

House Prices

<html><body>
Throughout 2019, Melbourne's house price have almost recovered what was lost during the slump, according to the latest quarterly report from Domain.
Houses have seen a 5% increase in value with median prices reaching $901,951. Units have seen even stronger growth of 5.6% with median values hovering around $549,701.
Though the year sprung off with deteriorating prices, the rest of 2019 saw growth, with the the final quarter providing the strongest quarterly gain in three years and the largest annual jump in two years.
With just under $6,800 left to regain, it appears that house prices are set for a new record high next quarter. 
However, this recovery remains uneven across the Melbourne as there are substantial price rises concentrated at the upper-end, led by the city, the inner east and inner south. 
Units in Melbourne continue to outperform houses as unit prices produced the strongest quarterly growth since mid-2009, and the biggest annual surge since mid-2010.
Unit prices are currently at a new record high that is 7.5 per cent higher than the previous peak in early 2018. 
Melbourne and Hobart units were the only cities to record a new high. Meanwhile, other cities remain below previous peaks in unit prices. 
Melbourne is the second most unaffordable city for units, with its price being higher than the median house prices in Adelaide, Perth, Darwin and Hobart. 
</body></html>

j.ballantyne1990-6AQqhLzZaK

Melbourne's property prices look set for a new record high: Domain

<html><body>
EXPERT OBSERVATION
With the Reserve Bank of Australia cutting official rates to 0.75% on Tuesday, has been a wave of commentary about the move doing little to help the economy apart from boosting housing prices.
There are two parts to assessing this claim. First, do rate cuts drive up property prices? Second, is that all they do?
Do rate cuts drive up property prices?
Economists have a precise answer to this question, and also a more practical one.
The precise answer is that all assets – stocks, bonds, property, stamps, vintage baseball cards, you name it – can be priced using <a href="https://faculty.chicagobooth.edu/john.cochrane/research/papers/samplechapters.pdf" target="_blank">what is known as</a> the stochastic discount factor (SDF).
This says that in pricing an asset you should factor in all the future cash flows the asset will generate (rent or dividends or capital gains) and then translate those returns into today’s money, adjusting for the riskiness of those cash flows.
An easier way to think about how rate cuts might affect property prices – consistent with the asset-pricing approach – goes like this.
People look at how much money they can borrow based on what they can afford to pay back. An interest rate cut boosts their borrowing power.
Even though the major banks have only passed on about half of the Reserve Bank’s latest cut (owner-occupied mortgage rates have been cut by 13-15 basis points), that’s enough to give a household with income of $150,000 about another $12,000 to $14,000 in borrowing power.
They thus spend more and, because there is a limited supply of properties, this pushes prices up. So, yes, lower interest rates do tend to boost property prices.
Is that all rate cuts do?
But boosting property prices is not all that rate cuts do.
Higher prices for new dwellings help developers. They often lead to an increase in construction jobs as developers anticipate better conditions for selling properties. New property construction has a number of other effects, too, such as changing <a href="https://www.rba.gov.au/publications/rdp/2019/pdf/rdp2019-01.pdf" target="_blank">the average quality of the rental stock</a> and spurring more retail spending (because those new homes need to be furnished).
Perhaps even more important is the pseudo-psychological effect of existing home owners feeling wealthier when house prices go up. This can lead to increased consumer spending – and this can have a big economic effect, given consumer spending accounts for about 60% of GDP.
This “wealth effect”, rational or not, seems to be real. It is part of the reason the Reserve Bank’s governor, Philip Lowe, appeared to be concerned about Sydney and Melbourne house prices falling in the past couple of years. It is also why federal treasurer Josh Frydenberg is happy to see property prices again on the rise.
Finally, lower interest rates do make business investment cheaper.
Would corporate tax cuts provide a bigger boost to investment? You bet. Are there diminishing returns to rate cuts as the cash rate approaches zero? That’s very likely to be the case.
But would businesses invest more if rates were two percentage points higher? No way. And would business like rates to be higher? I seriously doubt it.
Rate cuts do something to drive down unemployment, drive up consumer prices, and boost investment generally.
Are rate-cut driven prices increases bad?
But they certainly do also drive up residential property prices.
The important question is whether that’s bad or not. The answer to this question is a little murkier.
Let’s start with the fact borrowers should be thinking about how much to borrow.
If they borrow too much and are unable to repay their loans, that’s very bad news for them. Defaulting on a mortgage is a wrenching experience. Most people try hard to avoid that.
That said, sometimes people make poor choices through lack of information, lack of thought or lack of willpower. Occasionally an unscrupulous third party will encourage them to borrow more than they should.
But it’s not in the interest of banks to make too many loans that don’t get repaid. If borrowers are the first line of defence again bad price increases, lenders are the second line of defence.
There is a third line of defence: prudential regulation. The <a href="https://www.apra.gov.au/" target="_blank">Australian Prudential Regulation Authority</a> and the <a href="https://asic.gov.au/" target="_blank">Australian Securities and Investments Commission</a> are charged with enforcing “responsible lending laws” and ensuring the animal spirits and (sometimes) bad incentives of borrowers and lenders don’t get out of control.
So property prices increasing a few percent on the back of the rate cuts is unlikely to be problem – though as the Reserve Bank governor is fond of saying, “<a href="https://www.rba.gov.au/speeches/2019/sp-gov-2019-09-24" target="_blank">time will tell</a>”.<img src="https://counter.theconversation.com/content/124600/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1">
Richard Holden, Professor of Economics, UNSW.
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/vital-signs-yes-house-prices-will-rise-with-lower-interest-rates-but-thats-not-the-only-effect-124600" target="_blank">original article</a>.
</body></html>

House prices will rise with lower interest rates, but that’s not the only effect

<html><body>
EXPERT OBSERVATION
After the biggest fall in at least 40 years – with a 10.2% top to bottom fall between September 2017 and June this year - average capital city home prices have turned up again.
I thought prices would fall further with a 15% top to bottom fall led by around 25% falls in Sydney and Melbourne. But the facts changed from May – with the election removing the threat to negative gearing &amp; the capital gains tax discount, earlier than expected interest rate cuts &amp; a relaxation of APRA’s 7% interest rate test all pushing prices up again. So, where to from here?
Extreme property views
There are basically two extreme views amongst “property experts”. On the one hand, some real estate spruikers still wheel out the old “property will double every seven years” line. On the other hand, property doomsters say it’s hugely overvalued and over-indebted with massive mortgage stress and so a 40% or so crash is inevitable.
The trouble with the former is that implies home price growth of 10.3% pa, so even if wages growth picks up to 3.5% (a big ask!) it implies that the average price to income ratio of Australian housing will rise to around nine times over the next seven years from around six times now and in 14 years’ time it will be 14 times!
The trouble with the doomsters is that they’ve been saying that for 15 years and we’re still waiting for the crash.
In between, first home buyers are wondering why it’s so hard to do what my and my parent’s generation took for granted: be part of the Aussie dream with a quarter acre block.
The reality is it’s far more complicated than these extremes. Here’s seven stylised “facts” regarding Australian property.
First – it’s expensive
This has been the case since early last decade and remains so despite the recent correction in prices:
<ul>
<li>According to the 2019 Demographia Housing Affordability Survey the median multiple of house prices to income is 5.7 times in Australia versus 3.5 in the US and 4.8 in the UK. In Sydney it’s 11.7 times &amp; Melbourne is 9.7 times.</li>
<li>The ratios of house prices to incomes and rents relative to their long-term averages are at the high end of OECD countries.</li>
<li>The surge in prices relative to incomes has seen household debt relative to household income rise from the low end of OECD countries 25 years ago to the high end now.</li>
</ul>
<a href="https://www.propertyobserver.com.au/images/2019/9/11/house%20price%201.jpg" target="_blank">Click here </a>to enlarge: 
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2019/9/11/house%20price%201.jpg" alt="">
These things arguably make residential property Australia’s Achilles heel. But that’s been the case for 15 years or so now.
Second – it’s diverse
While it’s common to refer to “the Australian property market”, in reality there is significant divergence between cities. This divergence has been extreme over the last five years with Perth and Darwin seeing large price falls in response to the end of the mining investment boom, as other cities rose.
<a href="https://www.propertyobserver.com.au/images/2019/9/11/house%20price%202.jpg" target="_blank">Click here </a>to enlarge: 
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2019/9/11/house%20price%202.jpg" alt="">
The divergence is also evident in gross rental yields that range from 8.7% in regional WA units to 3.1% in Sydney houses.
Third – talk of mortgage stress is overstated
Headlines of excessive mortgage stress have been common for over a decade now.
There is no denying housing affordability is poor, household debt is high and some households are suffering significant mortgage stress. But most borrowers appear to be able to service their mortgages.
And despite some seeing negative equity and a significant proportion of borrowers switching from interest only to principle &amp; interest loans (which has seen interest only loans drop from nearly 40% of all loans to 23%) there has been no surge in forced sales and non- performing loans.
Non-performing mortgages have increased but remain low at around 0.9%.
While Australia saw a deterioration in lending standards with the last boom, it was nothing like other countries saw prior to the GFC.
Much of the increase in debt has gone to older, wealthier Australians, who are better able to service their loans.
Low doc loans are trivial in Australia and the proportion of high loan to valuation ratio loans has fallen as has the proportion of interest only loans.
<a href="https://www.propertyobserver.com.au/images/2019/9/11/house%20price%203.jpg" target="_blank">Click here</a> to enlarge: 
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2019/9/11/house%20price%203.jpg" alt="">
Fourth – it’s been chronically undersupplied
Annual population growth since mid-last decade has averaged 373,000 people compared to 217,000 over the decade to 2005, which requires roughly an extra 75,000 homes per year.
Unfortunately, the supply of dwellings did not keep pace with the population surge (see the next chart) so a massive shortfall built up driving high home prices.
Thanks to the surge in unit supply since 2015 this is now being worked off, but it follows more than a decade of accumulated undersupply which is the main reason why housing has remained relatively expensive in Australia.
Not tax breaks or low rates – all of which exist in other countries with far more affordable housing!
<a href="https://www.propertyobserver.com.au/images/2019/9/11/house%20price%204.jpg" target="_blank">Click here </a>to enlarge: 
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2019/9/11/house%20price%204.jpg" alt="">
Fifth – house prices go up and down
After several episodes of price declines ranging from 5 to 10% across various cities over the last 15 years and 15%, 21% and 31% for Sydney, Perth and Darwin respectively in recent years home buyers should be under no illusion that prices only go up.
Sixth – the housing market remains rate sensitive
While it varies from city to city, despite much scepticism recent rate cuts have helped push up the property market again.
Finally – house price crashes are not easy to forecast
The expensive nature of Australian property and associated high debt levels have seen calls for a property crash pumped out repeatedly over the last 15 years.
In 2004, The Economist magazine described Australia as “America’s ugly sister” thanks in part to soaring property prices.
Property crash calls were wheeled out repeatedly after the Global Financial Crisis (GFC) with one commentator losing a high-profile bet that prices could fall up to 40%.
In 2010, a US newspaper, The Philadelphia Trumpet, warned that “Los Angelification” (referring to a 40% slump in LA home prices around the GFC) will come to Australia. Similar calls were made a few years ago by a hedge fund researcher and a hedge fund: “The Australian property market is on the verge of blowing up on a spectacular scale."
Over the years these crash calls have often made it on to 60 Minutes and Four Corners.
But our view remains that to get a national housing crash – as opposed to periodic falls in some cities – we need much higher unemployment, much higher interest rates and/or a big oversupply.
But while the risk of recession has increased it remains unlikely, aggressive rate hikes are most unlikely and while property supply still has more upside it’s unlikely to lead to a big oversupply as approvals to build new dwellings are now falling.
As we have seen for years now overvaluation and high debt on their own are not enough to bring on a crash.
So where to now?
The rebound in buyer interest since May has seen auction clearance rates in Sydney and Melbourne rise to around 75% and prices lift nearly 2%, albeit other cities are mixed.
<a href="https://www.propertyobserver.com.au/images/2019/9/11/house%20price%205.jpg" target="_blank">Click here</a> to enlarge: 
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2019/9/11/house%20price%205.jpg" alt="">
 
This has so far come on low volumes, but they now look to be rising. Our base case is that house price gains will be far more constrained than the 10-15% implied by current auction clearance rates.
Compared to past cycles debt to income ratios are much higher, bank lending standards are tighter, the supply of units has surged with more to come and this has already pushed Sydney’s rental vacancy rate above normal levels and unemployment is likely to drift up as economic growth remains soft.
So, we don’t expect to see a return to boom time conditions and see constrained gains through 2020 – eg around 5% or so. There are three key things to watch:
<ul>
<li>The Spring selling season – if auction clearances remain elevated as listing pick up then it will be a positive sign that the pick-up in the property market has legs.</li>
<li>Housing finance commitments – these have bounced but will have to pick up a lot further to get 10-15% price rises.</li>
<li>Unemployment – if it picks up significantly in response to slow economic growth then it will be a big constraint on house prices and could result in another leg down in prices.</li>
</ul>
We don’t see the rebound in the Sydney and Melbourne property markets as a barrier to further monetary easing, but it may reduce the need as it turns the wealth effect from negative to positive. And if it continues to gather pace then expect a tightening of the screws again from bank regulators.
Implications for investors
Over long periods of time residential property provides a similar return to shares (at around 11% pa) but it offers good diversification as it performs well at different times to shares so it has a role to play in investors’ portfolios.
The pull back in prices in several cities in the last few years provides opportunities for investors, but just bear in mind that rental yields remain relatively low in Sydney and Melbourne and be wary of areas where there is still a lot of new units to hit.
There is probably better value to be found in regional centres and Perth, and Brisbane looks attractive in offering reasonable yields, a low vacancy rate and improving population growth.
Key points
<ul>
<li>
The Australian housing market remains far more complicated than optimists &amp; doomsters portray it to be.
</li>
<li>
Yes, it’s expensive and heavily indebted but talk of mortgage stress is overstated &amp; it’s been undersupplied.
</li>
<li>
The combination of rate cuts, the election and a modest regulatory relaxation have helped turn property prices back up, but the upswing is likely to be constrained.
</li>
</ul>
Dr Shane Oliver is Head of Investment Strategy and Chief Economist AMP Capital.
</body></html>

soliver-smf6LQXgW9

The seven things you need to know about the Australian property market: Shane Oliver 

<html><body>
EXPERT OBSERVER
Australian capital city dwelling prices rose 0.1% in July according to CoreLogic. After a 10.2% decline over 22 months (which was worse than the decline seen in the GFC), this is their first rise since September 2017. Dwelling prices are still down 7.3% from a year ago.
Sydney dwelling prices rose 0.2% which their second gain in a row and Melbourne prices also rose 0.2% which is also their second gain in a row.
Prices also rose in Brisbane (+0.2%), Hobart (+0.3%) and Darwin (+0.4%) but fell in Adelaide (-0.3%), Perth (-0.5%) and Canberra (-0.3%). Perth prices are now down 20.2% from their 2014 high.
<a href="https://www.propertyobserver.com.au/images/2019/8/1/house%20price%201.png" target="_blank">Click here</a> to enlarge:
<img src="https://www.urban.com.au/images/2019/8/1/house%20price%201.png" alt="">
Source: CoreLogic, AMP Capital
The boost from the election result which removed the threats to negative gearing and the capital gains tax discount, RBA rate cuts, and positive headlines around the relaxation of the 7% mortgage rate serviceability test and tax cuts have helped provide a bounce in home buyer demand.
This is clearly evident in a rebound in auction clearance rates where July saw the best monthly average clearance rates in Sydney since May 2017 and in Melbourne it was the best since October 2017. See the next two charts.
While this has come on very low volumes its usually the case that improved clearance rates lead a pick up in volumes and this is likely to be seen in the months ahead.
<a href="https://www.propertyobserver.com.au/images/2019/8/1/house%20price%203.png" target="_blank">Click here</a> to enlarge:
<img src="https://www.urban.com.au/images/2019/8/1/house%20price%203.png" alt="">
Source: Domain, CoreLogic, AMP Capital
<a href="https://www.propertyobserver.com.au/images/2019/8/1/house%20price%204.png" target="_blank">Click here</a> to enlarge:
<img src="https://www.urban.com.au/images/2019/8/1/house%20price%204.png" alt="">
Source: Domain, CoreLogic, AMP Capital
However, while home prices may have bottomed its doubtful that annual price gains are on their way to 10% or so as implied by the past relationship between clearances and prices and the current level of clearances. See the charts above. 
The situation today is very different to 2011 when the RBA first started to cut rates in this interest rate cutting cycle which in turn helped unleash booming conditions in the NSW and Victorian economies and rapid debt growth made easy by somewhat lax bank lending standards against a backdrop of undersupplied property markets all of which fuelled rapid growth in Sydney and Melbourne property prices.
 By contrast today, household debt to income ratios are much higher, bank lending standards are much tighter such that a return to rapid growth in interest only and investor loans is most unlikely, the supply of units has surged pushing Sydney’s rental vacancy rate well above normal levels and unemployment is likely to drift up as overall economic growth remains weak. 
So we don’t see a return to boom time conditions and expect constrained low single digit price gains through 2020.
<a href="https://www.propertyobserver.com.au/images/2019/8/1/houseprice%202.png" target="_blank">Click here</a> to enlarge: 
<img src="https://www.urban.com.au/images/2019/8/1/houseprice%202.png" alt="">
 
Source: CoreLogic, AMP Capital
Rising unemployment will be the key to watch. We expect unemployment to drift up to around 5.5% by year end, but a sharper rise could result in forced property sales and another leg down in property prices. This is not our base case but is the key risk in terms of the property outlook.
Much higher unemployment is something the RBA is keen to avoid – in fact it wants unemployment to fall to 4.5% or below – so our view remains for further cash rate reductions in November and February next year taking the cash rate to 0.5%.
<a href="https://www.propertyobserver.com.au/https://plus.google.com/110172465327488162875?rel=author">SHANE OLIVER</a> is head of investment strategy and economics and chief economist at <a href="https://www.ampcapital.com.au/home">AMP Capital</a> and is responsible for AMP Capital's diversified investment funds.
 
 
</body></html>

Australian capital city house prices up 0.1% in July, but do not expect a return to boom time conditions: Shane Oliver 

<html><body>
Sydney house prices have risen in more than half of the city’s regions in the June quarter, new Domain data shows.
But overall Sydney house and unit price did decline by 0.4 percent.
It was the smallest quarterly fall since December 2017, according to Domain’s June House Price Report. 
<div class="in-content-ad">The median house price dropped to $1,032,338 – back to early 2016 levels while the median unit price has dropped to $688,652, back to mid-2015 levels.</div>
“It’s likely that prices have bottomed out in Sydney recently,” said Domain economist Trent Wiltshire.
 “This is the biggest downturn in property prices since the 1980s …  it looks to be at least close to an end.”
Sydney’s median house prices
<table style="width: 731px;">
<thead><tr>
<td width="87"> </td>
<td width="136">MEDIAN PRICE</td>
<td width="87">QOQ CHANGE</td>
<td width="87">YOY CHANGE</td>
</tr></thead>
<tbody>
<tr>
<td width="87">Blue Mountains</td>
<td width="136">$650,100</td>
<td width="87">0.29%</td>
<td width="87">-3.69%</td>
</tr>
<tr>
<td width="87">Canterbury Bankstown</td>
<td width="136">$825,000</td>
<td width="87">-1.20%</td>
<td width="87">-12.23%</td>
</tr>
<tr>
<td width="87">Central Coast</td>
<td width="136">$605,000</td>
<td width="87">-0.82%</td>
<td width="87">-6.92%</td>
</tr>
<tr>
<td width="87">City and East</td>
<td width="136">$2,125,000</td>
<td width="87">-5.87%</td>
<td width="87">-8.44%</td>
</tr>
<tr>
<td width="87">Inner West</td>
<td width="136">$1,448,750</td>
<td width="87">3.48%</td>
<td width="87">-7.72%</td>
</tr>
<tr>
<td width="87">Lower North Shore</td>
<td width="136">$2,300,000</td>
<td width="87">4.55%</td>
<td width="87">-4.96%</td>
</tr>
<tr>
<td width="87">North West</td>
<td width="136">$1,170,000</td>
<td width="87">1.74%</td>
<td width="87">-7.87%</td>
</tr>
<tr>
<td width="87">Northern Beaches</td>
<td width="136">$1,610,000</td>
<td width="87">-3.01%</td>
<td width="87">-6.40%</td>
</tr>
<tr>
<td width="87">South</td>
<td width="136">$1,050,000</td>
<td width="87">1.69%</td>
<td width="87">-11.76%</td>
</tr>
<tr>
<td width="87">South West</td>
<td width="136">$671,000</td>
<td width="87">0.15%</td>
<td width="87">-7.54%</td>
</tr>
<tr>
<td width="87">Upper North Shore</td>
<td width="136">$1,600,000</td>
<td width="87">1.59%</td>
<td width="87">-3.03%</td>
</tr>
<tr>
<td width="87">West</td>
<td width="136">$675,000</td>
<td width="87">-1.46%</td>
<td width="87">-6.90%</td>
</tr>
<tr>
<td colspan="4">
Source: Domain House Price Report, June Quarter 2019
 
</td>
</tr>
</tbody>
</table>
Wiltshire said the recovery was skewed to higher-priced areas: lower north shore house prices recorded the strongest growth of 4.55% to $2.3 million in the June quarter.
It was followed by the inner west, up 3.48% to $1,448,750.
The upper north shore median increased 1.59 per cent to $1.6 million in the quarter ending in June.
Over the quarter, Melbourne median house prices rose 0.3%.
The best performer was Canberra, who saw their median house price over the quarter jump 1.5%.
It was followed by Hobart whose house prices rose 0.7%.
Capital city median house prices
<table><tbody>
<tr>
<td width="193" data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":-0.022826086956521774}'> </td>
<td width="215">Median house price</td>
<td width="136">QoQ</td>
<td width="87">YoY</td>
</tr>
<tr>
<td>Sydney</td>
<td data-sheets-value='{"1":2,"2":"Sydney"}'>$1,032,338</td>
<td data-sheets-value='{"1":2,"2":"$1,032,338"}'>-0.4%</td>
<td data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":-0.004}'>-9.1%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Melbourne"}'>Melbourne</td>
<td data-sheets-value='{"1":2,"2":"$818,237"}'>$818,237</td>
<td data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":0.003}'>0.3%</td>
<td data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":-0.077}'>-7.7%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Brisbane"}'>Brisbane</td>
<td data-sheets-value='{"1":2,"2":"$559,167"}'>$559,167</td>
<td data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":-0.014}'>-1.4%</td>
<td data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":-0.018}'>-1.8%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Adelaide"}'>Adelaide</td>
<td data-sheets-value='{"1":2,"2":"$540,473"}'>$540,473</td>
<td data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":-0.001}'>-0.1%</td>
<td data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":0.014}'>1.4%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Perth"}'>Perth</td>
<td data-sheets-value='{"1":2,"2":"$528,186"}'>$528,186</td>
<td data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":-0.02}'>-2.0%</td>
<td data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":-0.054}'>-5.4%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Hobart"}'>Hobart</td>
<td data-sheets-value='{"1":2,"2":"$474,423"}'>$474,423</td>
<td data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":0.007}'>0.7%</td>
<td data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":0.039}'>3.9%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Canberra"}'>Canberra</td>
<td data-sheets-value='{"1":2,"2":"$741,947"}'>$741,947</td>
<td data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":0.015}'>1.5%</td>
<td data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":-0.001}'>-0.1%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Darwin"}'>Darwin</td>
<td data-sheets-value='{"1":2,"2":"$502,521"}'>$502,521</td>
<td data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":-0.023}'>-2.3%</td>
<td data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":-0.029}'>-2.9%</td>
</tr>
<tr>
<td colspan="4" data-sheets-value='{"1":2,"2":"Darwin"}'>
Source: Domain House Price Report, June Quarter 2019
</td>
</tr>
</tbody></table>
Sydney’s median unit prices
Sydney's median unit prices didn't perform as well as houses over the June quarter in the same areas.
The worst performer was the Central Coast, whose 7.37% June quarter change took its year on year change to over 10%.
The worst performer year on year is the Canterbury Bankstown area which saw declines over 16.6%.
<table style="width: 826px;"><tbody>
<tr>
<td width="87"> </td>
<td width="136">Median price</td>
<td width="87">QoQ change</td>
<td width="87">YoY change</td>
</tr>
<tr>
<td width="87">Canterbury Bankstown</td>
<td width="136">$500,000</td>
<td width="87">-3.10%</td>
<td width="87">-16.67%</td>
</tr>
<tr>
<td width="87">Central Coast</td>
<td width="136">$440,000</td>
<td width="87">-7.37%</td>
<td width="87">-10.39%</td>
</tr>
<tr>
<td width="87">City and East</td>
<td width="136">$910,000</td>
<td width="87">1.11%</td>
<td width="87">-7.61%</td>
</tr>
<tr>
<td width="87">Inner West</td>
<td width="136">$740,000</td>
<td width="87">2.07%</td>
<td width="87">-5.73%</td>
</tr>
<tr>
<td width="87">Lower North Shore</td>
<td width="136">$852,000</td>
<td width="87">-7.89%</td>
<td width="87">-9.36%</td>
</tr>
<tr>
<td width="87">North West</td>
<td width="136">$660,000</td>
<td width="87">-2.22%</td>
<td width="87">-9.47%</td>
</tr>
<tr>
<td width="87">Northern Beaches</td>
<td width="136">$780,000</td>
<td width="87">-2.50%</td>
<td width="87">-11.11%</td>
</tr>
<tr>
<td width="87">South</td>
<td width="136">$640,000</td>
<td width="87">-4.48%</td>
<td width="87">-10.65%</td>
</tr>
<tr>
<td width="87">South West</td>
<td width="136">$438,000</td>
<td width="87">-2.67%</td>
<td width="87">-10.61%</td>
</tr>
<tr>
<td width="87">Upper North Shore</td>
<td width="136">$723,000</td>
<td width="87">0.42%</td>
<td width="87">-6.10%</td>
</tr>
<tr>
<td width="87">West</td>
<td width="136">$520,000</td>
<td width="87">-5.45%</td>
<td width="87">-11.26%</td>
</tr>
<tr>
<td colspan="4" width="87">
Source: Domain House Price Report, June Quarter 2019
</td>
</tr>
</tbody></table>
Across the capitals Melbourne was the only one with an increase in the median unit price, up 2%.
Darwin continued its damaging decline, a further 4.8% to be 10.4% down on the year.
Capital city median unit prices
<table style="width: 631px;"><tbody>
<tr>
<td width="193" data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":-0.029}'>City</td>
<td width="215">Median unit price</td>
<td width="136">QoQ</td>
<td width="87">YoY</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Sydney"}'>Sydney</td>
<td>$688,652</td>
<td data-sheets-value='{"1":2,"2":"$688,652"}'>-0.40%</td>
<td data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":-0.072}'>-7.20%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Melbourne"}'>Melbourne</td>
<td data-sheets-value='{"1":2,"2":"$501,009"}'>$501,009</td>
<td data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":0.02}'>2.00%</td>
<td data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":-0.007}'>-0.70%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Brisbane"}'>Brisbane</td>
<td data-sheets-value='{"1":2,"2":"$368,382"}'>$368,382</td>
<td data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":-0.031}'>-3.10%</td>
<td data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":-0.089}'>-8.90%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Adelaide"}'>Adelaide</td>
<td data-sheets-value='{"1":2,"2":"$310,642"}'>$310,642</td>
<td data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":-0.002}'>-0.20%</td>
<td data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":0.006}'>0.60%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Perth"}'>Perth</td>
<td data-sheets-value='{"1":2,"2":"$342,930"}'>$342,930</td>
<td data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":-0.016}'>-1.60%</td>
<td data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":-0.077}'>-7.70%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Hobart"}'>Hobart</td>
<td data-sheets-value='{"1":2,"2":"$356,751"}'>$356,751</td>
<td data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":-0.064}'>-6.40%</td>
<td data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":-0.015}'>-1.50%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Canberra"}'>Canberra</td>
<td data-sheets-value='{"1":2,"2":"$448,737"}'>$448,737</td>
<td data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":-0.014}'>-1.40%</td>
<td data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":0.019}'>1.90%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Darwin"}'>Darwin</td>
<td data-sheets-value='{"1":2,"2":"$298,438"}'>$298,438</td>
<td data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":-0.048}'>-4.80%</td>
<td data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-value='{"1":3,"3":-0.104}'>-10.40%</td>
</tr>
<tr>
<td colspan="4" data-sheets-value='{"1":2,"2":"Darwin"}'>
Source: Domain House Price Report, June Quarter 2019
</td>
</tr>
</tbody></table>
</body></html>

House prices rise in more than half of Sydney’s regions in 2019 June quarter: Domain 

<html><body>
Our base case remains that national capital city property prices will have a top to bottom fall of 15% out to a bottom in 2020 of which they have so far done nearly 10% and that for previous boom time cities of Sydney and Melbourne the top to bottom decline will be around 25% (of which they have so far done nearly 15% and 11% respectively). 
The negatives weighing on the property market remain significant and include tight credit (which will get another boost from mid-year with the start-up of Comprehensive Credit Reporting which will see banks crack down on borrowers with multiple undeclared loans), the ongoing switch from interest only to principle and interest loans, record unit supply still to hit particularly in Sydney and Melbourne, an 80% collapse in foreign demand, fears that negative gearing and capital gains tax arrangements will be made less favourable if there is a change of government and falling prices feeding on themselves with FOMO (the fear of missing out) becoming FONGO (the fear of not getting out).
Taken together these are continuing to drive a perfect storm for the Sydney and Melbourne property markets because they saw the strongest gains into 2017 and had become more speculative with a greater involvement by investors. 
<a href="https://www.propertyobserver.com.au/images/2019/5/1/shane%20oliver%201%20.png" target="_blank">Click here</a> to enlarge: 
<img src="https://www.urban.com.au/images/2019/5/1/shane%20oliver%201%20.png" alt="">
 
Source: CoreLogic, AMP Capital
The slowing in the pace of home price falls (from -1.3% in December to -1.2% in January to -0.9% in February to -0.7% in March to 0.5% in April for the capital cities), along with a bounce in housing finance in February and a pick-up in auction clearance rates from their lows late last year are positive signs and at least suggest that we are not seeing any of the panic/forced selling that some had feared would occur. 
However, the bounce in auction clearance rates looks to be largely seasonal and they remain historically weak, the nearly five year decline in Perth and Darwin property prices has seen several phases where price declines slowed then accelerated again and the start-up of Comprehensive Credit Reporting means that the tightening in lending standards could still have another leg to go, less favourable negative gearing and capital gains tax arrangements if there is an ALP victory could see renewed pressure on property prices next year and property prices outside of Sydney and Melbourne have been proving to be a bit weaker than we expected.
Implications for interest rates
Ongoing home price falls will depress consumer spending as the wealth effect has now become negative and homeowners are less inclined to allow their savings rate to decline further to compensate for weak wages growth. It’s also a negative for banks and is consistent with our view that the RBA will cut the cash rate to 1% by year end.
With growth slowing and inflation coming in weaker than expected, rate cuts are likely to come earlier than our previous expectation for cuts in August and November, with the first cut probably coming next week (although we admit that a May rate cut is a close call given its in the midst on an election campaign).
<a href="https://www.propertyobserver.com.au/images/2019/5/1/shane%20oliver%202.png" target="_blank">Click here</a> to enlarge: 
<img src="https://www.urban.com.au/images/2019/5/1/shane%20oliver%202.png" alt="">
Source: CoreLogic, AMP Capital
What will stop the property price falls?
It’s a while off yet but we expect a combination of RBA rate cuts flowing to lower mortgage rates, improved affordability thanks to lower prices, continuing strong population growth, the prospect of slowing new supply and possibly some form of Government support (like a new round of Federal First Home owner grants and/or a reduction in APRA’s minimum 7% mortgage serviceability test for new home loans) to help prices stabilise sometime around next year.
An earlier rate cut in May could bring forward the bottom in house prices as in the last two cycles they bottomed around four months after the first cut, although it is worth noting stronger supply conditions, tighter lending standards, higher debt to income ratios and depressed investor confidence will likely constrain the response of house prices to interest rate changes this time around.
 
Key points: 
<ul type="disc">
<li>Although the rate of decline has slowed further, Australian capital city dwelling prices fell another 0.5% in April according to CoreLogic. This marks 19 months of consecutive price declines since prices peaked in September 2017. This has left prices down 8.4% from a year ago and they have now fallen 9.7% from their September 2017 high which is worse than their GFC decline of 7.6%.</li>
<li>Sydney dwelling prices fell another 0.7% and they have now fallen 14.5% from their July 2017 high, which is their worst fall since the early 1980s recession. Melbourne prices fell another 0.6% and are down 10.9% from their November 2017 high, which is their worst fall in the period since 1980. Perth prices fell another 0.4% and are now down 18.4% from their 2014 high and Darwin prices fell another 1.2% and are down 28.3% from their 2014 high. Prices also fell in Brisbane (-0.4% in April and down 1.9% for their recent high) and Adelaide (-0.1% in April and down 0.7% from their recent high) and even Hobart is now falling with a decline of 0.9%. Canberra was the only capital city to see a gain (+0.4%). </li>
<li>While Sydney and Melbourne have seen the steepest falls since 2017 (because they had the biggest boom between 2012 and 2017), other cities are pretty soft too with Perth and Darwin having been falling for five years now and Brisbane and Adelaide are proving weaker than we had expected despite not having had the prior boom that Sydney and Melbourne and, much earlier, Perth and Darwin had.   </li>
</ul>
SHANE OLIVER is the Head of Investment Strategy and Chief Economist at AMP Capital
</body></html>

Australian house prices down again in April with still more to go: Shane Oliver 

<html><body>
On the back of increasing levels of supply, Greater Brisbane unit prices recorded their largest fall in 17 years in the December 2018 quarter, according to Domain's latest House Price Report.
The report found, this has created a window for buyers to purchase at 2013 prices.
Brisbane unit prices fell 5% over the quarter and 7.9% over the year to $369,882.
Brisbane house prices fell 0.2% over the quarter and 0.1% over the year to $566,058.
<a href="https://www.propertyobserver.com.au/subscribe" target="_blank"><img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2019/1/Subscriber%20strip%20ad.jpg" alt=""></a>
Domain Senior Research Analyst, Dr Nicola Powell said: “Greater Brisbane house price growth evaporated by the end of 2018, with prices ultimately flatlining over the quarter and year. This provides further evidence that credit access is not only impacting Sydney and Melbourne, it is now having a marked effect on housing markets that would otherwise be growing.
“A number of factors should provide better foundations for the housing market, as greater job prospects and an improved economic outlook draws residents to the state. Queensland remains a magnet for interstate migrants, which is currently at a 12-year high, and more residents are moving from overseas. Demand is rising, with Domain recording an increase in the number of views per listing.
“Although house price growth has stalled, it is a better outcome than many other Australian capital cities have experienced, with Brisbane proving the fourth best performer, behind Hobart, Adelaide and Canberra.
“A number of dynamics will eventually see Brisbane’s heightened supply of units absorbed. 
“The number of developments under construction, apartment completions and multi-unit building approvals are all shrinking. However, for now the stricter lending environment is stalling a recovery.”
<img src="https://www.urban.com.au/images/2019/1/23/Domain%20Q4%20Bris.JPG" alt="">
</body></html>

Greater Brisbane unit prices recorded their largest fall in 17 years: Domain

<html><body>
Unit prices have been holding steadier than houses in Melbourne, just 5.8% below the peak they reached at the beginning of 2018, according to Domain's latest House Price Report.
The report found, Melbourne house and unit price falls sped up throughout 2018, although so far the downturn has been shorter and less severe when compared to Sydney.
Melbourne house prices fell 2.1% over the quarter and 8.4% over the year to $833,321.
Melbourne unit prices fell 1.8% over the quarter and 4.3% over the year to $479,306.
<a href="https://www.propertyobserver.com.au/subscribe" target="_blank"><img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2019/1/1/Strip%20ad%20keep%20up%20in%202019.jpg" alt=""></a>
Domain Senior Research Analyst, Dr Nicola Powell said: "Restrictions to housing finance have hit Melbourne and Sydney the hardest. However, Melbourne is in better shape than Sydney, as a growing employment sector, lower affordability hurdles and stronger population growth supports the underlying demand for housing.
“Melbourne house prices have now fallen for four consecutive quarters, the last time this occurred was seven years ago. The ongoing falls have resulted in the steepest annual house price drop since Domain records began in 1993. However, it’s worth noting that the downturn follows an extraordinary period of growth, with house prices rising 72.8% in just over five years.
"Houses are 8.4% below the price peak achieved at the end of 2017, with homes now transacting at late-2016 prices.
“Underpinning the strength of units relative to houses is affordability hurdles and lending practices. Factors that have supported demand for housing at the lower end of the price spectrum include a rise in the number of first home buyers, and lending practices designed to reduce exposure to borrowers with a high debt to income ratio.”
<img src="https://www.urban.com.au/images/2019/1/23/Domain%20Q4%20Melb.JPG" alt="">
</body></html>

Melbourne unit prices holding steadier than houses: Domain

<html><body>
<div>Moves by banks and their regulators to curb investor lending, combined with a drop in overseas buyers, has seen national capital city house prices decrease 2.9 per cent over the year to $781,787, according to the latest Domain Home Price Report.</div>
<div> </div>
<div>The report found unit prices have fallen by 1.4 per cent over the year to $549,163.</div>
<div> </div>
<div>Over the quarter, houses in Hobart and units in Adelaide have been the only market segments to buck the national downward trend. Domain senior research analyst, Dr Nicola Powell said "it’s a development that will no doubt be welcomed by Australia’s first-home buyers - property prices across almost all capitals continue to fall.</div>
<div> </div>
<div>"In many markets throughout Australia, gaining entry has become a greater possibility."</div>
<div>
<div>
 <img src="https://gallery.mailchimp.com/b16c0b957ea98f662ab985606/images/e41111b1-d7bd-43d8-b7af-b69c1cabf583.png" width="580" height="386" data-imagetype="External">
</div>
</div>
<div> </div>
<div>Key findings concerning houses were that Sydney house prices are now at late-2016 levels, while Melbourne house prices haven't fallen as far and are now at 2017 levels.</div>
<div> </div>
<div>Canberra house prices increased over the year but were flat over the quarter, similarly Brisbane and Adelaide were also up over the year, but down slightly over the quarter.</div>
<div> </div>
<div>Hobart was the standout and continued to grow strongly, recording double-digit annual growth.</div>
<div> </div>
<div>Key findings concerning units were that units in Sydney and Melbourne continued to outperform houses, while in all other capital cities houses outperformed units.</div>
<div> </div>
<div>Unit prices fell over the September quarter and year across all capital cities, apart from a minor quarterly improvement in Adelaide, and annual growth in Melbourne and Hobart. As a result all capital cities are now under performing relative to last year, except for Perth and Darwin.</div>
<div> </div>
<div>National unit prices have continued to weaken, with annual growth declining for two consecutive quarters.</div>
<div> </div>
<div>“There are opportunities for buyers in all property cycles — the key is to be ready when opportunities arise,” Dr Nicola Powell concluded.</div>
</body></html>

Sydney house prices down 6.5 percent, double Melbourne's drop: Domain

<html><body>
EXPERT OBSERVER
Whenever a major research firm publishes its latest data on the movement in capital city house prices, media presents that data as fact. 
It also, often, makes sweeping conclusions about the meaning of the figures, relative to affordability, the state of the market and the impact on consumers.
The next firm to publish data will receive the same media treatment: the figures are factual, therefore this is what is means for the market and for buyers and sellers.
The problem is: the two sets of data are quite different and, in some cases, contradictory.
By the time figures have been published from five different sources - the ABS, the REIA, SQM Research, Domain and the ever-present but often-puzzling CoreLogic are regularly featured - consumers who have been absorbing all the data will be massively confused and terribly misinformed.
It’s rare for all sources to agree on how much city markets are rising or falling - or, indeed, whether markets are rising or falling.
According to CoreLogic’s latest data, Melbourne house prices are lower than 12 months ago - but both the ABS and SQM Research disagree. They both have Melbourne about 3% higher than a year ago.
It’s a similar situation with Adelaide: SQM says the Adelaide housing market is down a little, but the ABS and CoreLogic says it’s risen marginally.
All three sources believe the Hobart market has risen in the past year, but there is considerable disagreement on how much: CoreLogic says 10.7%, the ABS 15.5% but SQM claims it’s only 6.4%.
There’s a substantial difference there: SQM says there’s only moderate growth in the Tasmanian capital but the official government source, the ABS, portrays a boom market.
CoreLogic tells us the Perth housing market is still in the negative but SQM claims that the downturn is over and prices have started to rise again.
Canberra is either the strongest capital city market in the nation, up 10.4% in the annual terms, or it’s rising only moderately at 2% or 3% - depending on whose figures you believe.
SQM says the average scenario across the eight capital cities is an annual rise of 2.6%, but the ABS says there’s been no meaningful change, while CoreLogic says the national market is down 2%.
Newspaper headlines keep telling that prices are falling across Australia, because they tend to publish the CoreLogic figures, but both the ABS and SQM disagree.
Both those sources have prices higher than a year ago in five of the eight capital cities, and SQM has the national average up 2.6%, but you get quite a different conclusion is you focus on the CoreLogic data.
The only matters on which the three major sources broadly agree is that the Darwin housing market is down about 4% and that the Brisbane house market is up by 1% or 2%.
The message for consumers is: don’t take price data published by media too seriously - and don’t base big financial decisions on the published data.
Terry Ryder is the founder of hotspotting.com.au
<a href="https://mailto:ryder@hotspotting.com.au">ryder@hotspotting.com.au</a>
twitter.com/hotspotting
</body></html>

House Prices

Editor's Picks

Have something to contribute?

Developments

New apartments

New townhouses

News

House Prices

Editor's Picks

Receive the latest news stories to your inbox

Have something to contribute?

Developments

New apartments

New townhouses

News