<p>Perth’s new apartment market recorded its strongest quarter of sales since Q4 2021, with 412 apartments sold in Q1 2026 and a record quarterly sold value of $537 million, according to Urbis’ latest Apartment Essentials results.</p>

<p>Urbis said the March quarter result reflects strong, highly product‑specific demand across both ends of the market, from more attainable projects delivering at scale, through to premium stock being absorbed by equity‑rich downsizers.&nbsp;</p>

<p>David Cresp, Partner at Urbis, said the key story in Perth is not demand, it is the market’s ability to convert demand into delivered housing.&nbsp;</p>

<p>“This is the strongest sales quarter since Q4 2021, and it reinforces that demand in Perth is real and it’s local,” David Cresp said. “But the task now is delivery, turning that demand into projects that can actually be built and completed.”&nbsp;</p>

<p>[smartcode_project:default project_id=110291 project_image_fid=302785]</p>

<h2>Affordable product leads, premium demand remains resilient</h2>

<p>Sales in Q1 were led by more affordable projects, with The Boulevard (SKS Group) recording 115 sales in the quarter, the presentation noting this is only the second time a single project has surpassed 100 quarterly sales. The project was able to offer more affordable housing product right next to a train station.&nbsp;</p>

<p>Palmyra West (Finbar) also delivered strong results with 28 sales in Q1, following 84 sales in Q4, with an average price of under $800,000, underscoring depth of demand for well‑located, attainable new stock.&nbsp;</p>

<p>At the premium end, Urbis said downsizer demand is continuing, with the results highlighting Romeo (Applecross, Finbar) recording 75 sales and reaching almost 50% sold in one quarter.</p>

<p>Jual (Shenton Park, Celsius Property) also posted a strong quarter with 28 sales, reaching 39% sold in one quarter.</p>

<p>Urbis noted that Perth apartment demand is not speculative, not investor‑led, and not uniform, describing it as localised, often equity‑driven and highly product‑specific, a pattern reflected in the polarisation between strong “attainable” performers and premium downsizer product.&nbsp;</p>

<p>[smartcode_project:default project_id=148957 project_image_fid=364102]</p>

<h2>Prices underpinned by costs, and the delivery risk is growing</h2>

<p>Urbis said pricing pressure is cost not demand‑driven: construction costs and delivery risk are now a central constraint, with the results noting build costs remain elevated and volatile, and that energy, fuel and labour uncertainty weigh on feasibility.</p>

<p>David Cresp said a growing challenge for private Build‑to‑Sell developers is simply securing a builder in the current environment.</p>

<p>“Developers are really feeling the pressure from a building market that was operating at capacity and securing a builder is challenging,” David Cresp said, adding that even where a builder can be secured, “trying to get to the price that makes the development financially viable is incredibly challenging in the current market.”&nbsp;</p>

<p>Urbis’ broader WA commentary also notes that industry remains at or above capacity with lot and housing creation, and that many builders are limiting new sales to manage stretched workforces and fixed‑price contract pressures, conditions that flow directly into apartment feasibility and delivery timing.</p>

<p>[smartcode_project:default project_id=108869 project_image_fid=317905]</p>

<h2>Supply: improving later, but still constrained, and Perth lags eastern benchmarks</h2>

<p>While near‑term supply remains constrained, Urbis’ forecast shows completions lifting “Supply is forecast to be back above 1,500 apartments per annum for the first time since 2019”, with 1,775 completions forecast for 2026, and volumes remaining above that level over the following years.&nbsp;</p>

<p>Looking further ahead, completions are forecast to reach 2,500 in 2028, with the report noting 32% of that total is social/affordable, reflecting the role of government‑supported delivery in rebuilding the pipeline.&nbsp;</p>

<p>However, Urbis said Perth remains behind comparable markets on pipeline scale. In a national comparison of projects under construction, the report shows under construction Perth Build‑to‑Sell (BTS) at 3,446 apartments versus the Gold Coast at 7,922. Mr Cresp said “The challenge for Perth is how to we grow the delivery pipeline”.</p>

<p>Urbis’ conclusion is that Perth’s market is increasingly defined by product discipline and delivery certainty, with the research identifying “delivery certainty is key” and calling out builder risk and procurement models as core success factors, alongside “timing and staging”.&nbsp;</p>


Joel Robinson

Perth apartment sales hit strongest pace since late 2021 as builder capacity tightens

<p><a href="https://www.apartments.com.au/developers/sammut-developments">Sammut Group</a> has secured development approval for its latest Brisbane apartment project, marking the Sydney developer’s next step in expanding its Queensland pipeline following the success of its debut Gold Coast development, Coast.</p>

<p>The approved project at <a href="https://www.apartments.com.au/new-apartments/44-glen-road-toowong-qld-4066">44 Glen Road, </a><a href="https://www.apartments.com.au/developments/toowong-qld-4066">Toowong</a> will deliver a 15-storey riverfront apartment building with 42 residences, significantly increasing the scale of the site’s previous approval for a smaller luxury scheme. Designed by Bureau^proberts, the development will comprise a mix of predominantly four-bedroom and two-bedroom apartments positioned to maximise Brisbane River and city views.</p>

<p>Sammut Director Julian Sammut said the group had been actively searching Brisbane for several years before identifying Toowong as the right fit.</p>

<p>“Brisbane was the right step for Sammut,” Sammut said.</p>

<p>“With the success of Coast we thought we should definitely look to do more in Queensland alone. We then pushed up to look at Brisbane. We've been looking for I'd say two to three years actually and it was hard to find the right location.”</p>

<p><img alt="Sammut makes Brisbane apartment play" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/f_auto,c_limit,w_1440,q_75/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/field/image/Screenshot%202025-12-23%20at%203.27.14%E2%80%AFPM.png?VersionId=dYAVIL7qdcGA8ojvkslSrLjczXFejSSx" /></p>

<p>Sammut said suburbs including New Farm and Teneriffe were considered before the group ultimately focused on Toowong due to its strong downsizer demographic and limited supply of developable riverfront land.</p>

<p>The site was acquired off-market after what Sammut described as a lengthy negotiation and planning process, with the developer pursuing an uplift to the original approval.</p>

<p>“We are DA approved now which is very exciting,” Sammut said.</p>

<p>“We've had our change approval come through and we've obviously doubled the height, 15 storeys plus rooftop. We've got 42 amazing apartments that are going to be coming to market soon.”</p>

<p><img alt="Sammut makes Brisbane apartment play" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,dpr_2.0,q_auto:good/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202025-12-23%20at%203.27.26%E2%80%AFPM.png?VersionId=ohkRkY0dIZlqdfME2EZePsCQavRiBadE" /></p>

<p>Bureau^proberts said the design responds to Toowong’s evolving urban character, balancing contemporary apartment living with the area’s established residential identity.</p>

<p>“A place where traditional Queensland living has taken place for centuries; Toowong is seeing a shift of contemporary influence, commercial and retail hubs mixed with well-considered residential offerings – all the while maintaining its character and charm,” the architect noted in planning documents submitted to Brisbane City Council.</p>

<p>The architecture practice said the project’s form was shaped by its riverfront setting, flood considerations, neighbouring building scales, and view corridors.</p>

<p>“They said the mix of four and two-bedroom apartments capture the ‘fundamental qualities of Queenslander living,’ translated into the context of a contemporary subtropical building.”</p>

<p>The development sits just off Coronation Drive within walking distance of Toowong’s retail precinct and the upgraded Regatta ferry terminal, while also benefiting from proximity to the incoming green bridge connection to West End. Sammut said the accessibility and amenity offering were central to the site’s appeal.</p>

<p>The approval adds to growing residential activity along the Toowong riverfront, joining nearby projects including Consolidated Properties’ Monarch Residences and Spyre Group’s ARC Residences.</p>


Sammut secures approval for debut Brisbane apartment development in Toowong

<p>Developer Lanevick is heading back into Sydney’s apartment market after focusing more heavily on the luxury townhouse and terrace sector in recent years.</p>

<p>Lanevick, founded and directed by Steve Maroun, is expecting to receive approval in the coming months for a new apartment development in Gladesville, with the aim to launch it to the market later this year.</p>

<p>The 51-apartment project, designed by Studio Johnston, will comprise a mix of one-, two-, and three-bedroom apartments positioned toward the Hunters Hill downsizer market.</p>

<p>“Traditionally it’s been difficult for people in that market to downsize because there just hasn’t been the right product available,” Maroun said.</p>

<p>“We’re targeting buyers who might have 30 to 40 per cent of their house value sitting in the bank after downsizing.</p>

<p>“They still want good spacious entertaining areas, they still want quality design, but they also want flexibility and the ability to enjoy life a bit more after working hard for a long time.”</p>

<p>The project sits near Boronia Park and within close proximity to the Parramatta River foreshore, an area Maroun says offers more of a Hunters Hill lifestyle than a traditional apartment precinct.</p>

<p>“From a lifestyle perspective, it’s really more Hunters Hill than Gladesville,” Maroun said. “You’re close to the foreshore, close to parklands, and still connected back into the village precinct.”</p>

<p>From level four and above, apartments will capture water views&nbsp;toward Sydney Harbour. Communal amenity will include rooftop entertaining areas, wellness spaces, and a gym tailored toward owner-occupier buyers.</p>

<p>“We’ve really designed these apartments around that buyer coming from the Hunters Hill LGA and what they’re actually looking for in their next chapter.”</p>

<p>The proposed development has also been designed to respond to the changing character of the broader Gladesville town centre, where a growing number of mixed-use and residential proposals are expected to emerge over the coming years.</p>

<p>“Gladesville presented a rare opportunity to deliver a genuinely design-led residential project within an evolving lifestyle precinct, just moments from the growing Gladesville town centre, and we’ve approached the project with a strong focus on architecture, liveability and long-term community value,” Maroun said.</p>

<p>Maroun said Lanevick saw a first-mover advantage within the precinct as planning controls continue to evolve to accommodate greater housing density.</p>

<p>“We think there’s a real opportunity there that hasn’t really been serviced properly yet,” he said.</p>

<p>“There’s going to be a broader evolution of the whole Gladesville village precinct over time, particularly with more activation and mixed-use outcomes.”</p>

<p>The Venus Street proposal will include a commercial and retail component at ground level designed to contribute to that evolving streetscape activation.</p>

<p>“A big part of the thinking was how do you activate that area properly and create more vibrancy and amenity, which is what Hunters Hill has been looking for,” Maroun said.</p>

<p>Lanevick’s focus since 2020 has largely been on smaller-scale luxury townhouse and terrace developments. The developer recently completed Royale Randwick, also designed by Studio Johnston, where prices reached $3.65 million. The project was featured in the UDIA NSW 2026 Professional Development Prospectus and was also named a finalist for Development of the Year.</p>

<p>&nbsp;</p>


Lanevick to cater for Hunters Hill downsizers with new Gladesville apartment development

<p>Property developer One Living, backed by former Macquarie banker turned investment manager Chris Green’s investment firm, has unveiled plans to bring more institutional capital into housing to help address the national supply crisis.</p>

<p>The New York-based investor has focused his firm, GreenPoint Partners, on addressing the supply shortage hitting middle market housing in Australia.</p>

<p>It is backing the new One Living business to develop more than 1000 units along the eastern seaboard. The new firm is starting with a development on Mona Vale Road, on the border of Mona Vale and Pymble, in Sydney’s Northern Beaches, with around 140 apartments planned. They are eyeing off more sites across the city.</p>

<p>With cost pressures rising in the industry, One Living’s model is to be a vertically integrated developer-builder, so it can respond directly to the housing gap by removing the cost inefficiencies embedded in traditional residential delivery.</p>

<p>“We are building a platform designed to operate at scale and starting in a market where there’s a clear need for quality, attainable housing,” One Living joint managing director Joseph Scuderi said.</p>

<p>“It’s that missing middle – it’s that attainable end of housing… that’s what most Australians invest into and what Australians can actually afford.”</p>

<p><img alt="Mona Vale" data-entity-type="file" data-entity-uuid="798dfa93-4941-4db6-a696-31e9dc18e81c" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-28%20at%202.31.50%E2%80%AFPM.png?VersionId=mKBqi5C_DmeiXS.AtJkcR8LQIxqCqmFi" /></p>

<p>GreenPoint Partners brings years of experience assembling and scaling real estate operating businesses across major markets. And Green sees a big opportunity in Australia.</p>

<p>“For its size, sophistication and importance to the community, Australia’s living sector has remained largely under-institutionalised, which represents significant opportunity,” Green said. “GreenPoint identified that gap, assembled the right team, and is backing One Living to build a platform that is aligned to market needs.”</p>

<p>Green said being a builder-developer would give the company the capacity and flexibility it required to deliver reasonably-priced homes.</p>

<p>“We want it to be at that attainable level; not super high end luxury but at that attainable level,” he said.</p>

<p><img alt="Mona Vale" data-entity-type="file" data-entity-uuid="74a5344a-4b26-4d4a-ada3-056b1220be77" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-28%20at%202.32.15%E2%80%AFPM.png?VersionId=vY8hXHO4reBMdO8ZXMWCNtGZJofUPQ3j" /></p>

<p>&nbsp;</p>

<p>One Living will undertake a component of affordable housing in its schemes, which it will own and operate, and it could also run build-to-rent on some sites.</p>

<p>Green praised local policy settings.</p>

<p>“The NSW government is being very supportive, strategic and pragmatic in terms of how do we generate more supply of housing,” he said. “We think it’s actually positive for development and the bit that’s been lacking at that attainable level is that it’s lots of relatively small private developers, whereas we want to create an institutional platform.”</p>

<p>One Living is also&nbsp;looking at high-density projects and could take on more institutional funding in the future.</p>

<p>“The way we will be able to achieve economies of scale is through size,” Green added.</p>


One Living enters Sydney's new apartment market with Northern Beaches site acquisition

<p>It's been several years since there's been an opportunity to buy a brand new townhome in Melbourne's coastal suburb of Mordialloc. Even apartment developments in recent times have been few and far between in the area.</p>

<p>Local developer LDS Property identified the gap in new housing, securing a site on White Street, directly opposite&nbsp;Woodlands Golf Club Mordialloc. They've recently launched&nbsp;<a href="https://www.apartments.com.au/new-townhouses/wm-residences-mordialloc-102-white-street-mordialloc-vic-3195">WM Residences</a>, just 13 townhouses which they have already started building.</p>

<p>Projects by Buxton Director Heath Thompson, who is selling WM Residences, says the townhouses x that perfect middle ground be</p>

<p data-end="683" data-start="511">"Mordialloc residents have had limited options to downsize within the suburb, often forcing them to look elsewhere despite long-standing ties to the area," Thompson says.</p>

<p data-end="882" data-start="690">"With very little comparable new supply coming to market, projects like WM Residences are well placed, particularly as buyers look to capitalise on current conditions amid constrained supply."</p>

<p data-end="882" data-start="690">[smartcode_project:default project_id=134646 project_image_fid=6109]</p>

<p>The development, designed by regarded architecture firm&nbsp;<a href="https://www.apartments.com.au/architects/ewert-leaf">Ewert Leaf</a>,&nbsp;adopts a deliberately restrained architectural approach, focusing on simplicity, durability and liveability rather than overt design gestures.</p>

<p>The boutique scale is central to the offering. With only 13 three-bedroom residences, each home is configured to prioritise functional layouts and everyday use, supported by private terraces and secure two-car garages.</p>

<p>Ewert Leaf’s design response leans into a calm, neutral material palette. Interiors are defined by oak flooring, white walls and soft finishes, creating a consistent and understated backdrop. The approach avoids trend-driven detailing in favour of longevity, with an emphasis on natural light and spatial clarity.</p>

<p>[smartcode_project:default project_id=134646 project_image_fid=6110]</p>

<p>Beyond aesthetics, the homes are designed to meet contemporary performance expectations. Each residence targets a minimum 6-star energy rating, incorporating double glazing, comprehensive insulation and all-electric Bosch appliances.</p>

<p>The project’s location supports a walkable coastal lifestyle, sitting within close proximity to Mordialloc’s foreshore, Main Street retail strip and the train station. Local cafés and dining venues, including Suburbia Deli and Hendriks Café, are within a short walk, reinforcing the area’s established neighbourhood character.</p>

<p>[smartcode_project:default project_id=134646 project_image_fid=6116]</p>

<p data-end="247" data-is-last-node="" data-is-only-node="" data-start="0">While <a href="https://www.apartments.com.au/developments/mordialloc-vic-3195">Mordialloc</a> is often defined by its beach and pier, the project taps into other areas of day to day living, offering easy access to local food, casual dining and transport, rather than positioning itself purely as a lifestyle retreat.</p>

<p>WM Residences reflects a continued trend across Melbourne’s coastal suburbs towards smaller-scale, design-led townhouse developments, particularly on infill sites where proximity to amenity is already established.</p>

<p>With construction commenced prior to its market entry, the project aligns with a growing preference among buyers for developments with visible progress and defined delivery timeframes.</p>

<p>[smartcode_project_cta:default project_id=134646]</p>


WM Residences fills gap in Mordialloc townhouse market

House Sales

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<p>Auction clearance rates are at their strongest in more than a year with a clearance rate of 77 percent for 3,700 auctions, according to CoreLogic.</p>
<p>The average time on market is also decreasing with a property averaging 55 days on the market before it’s sold as of this year.</p>
<p><a href="/images/2016/10/07/Auction%20clearance%20rate.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/10/07/Auction%20clearance%20rate.jpg" alt=""></p>
<p>Although new stocks are similar compared to last year overall the number of listings this year is lower as there is a decline of 1% overall.</p>
<p><a href="/images/2016/10/07/Listings.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/10/07/Listings.jpg" alt=""></p>
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jonathanchancellor-7SQnKwU6yx

House sale time on market reducing: CoreLogic

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<p>Top two sales over the past week, for states and territories for the week ending 25 September, according to CoreLogic.</p>
<p>Australian Capital Territory </p>
<p>10 Cockle Street, O’Conner, ACT 6 bed, 4 bath, 3 car house $1,950,000 Independent Property Group Gungahlin </p>
<p>37 Coolibah Crescent, O’Conner, ACT 5 bed, 2 bath, 2 car house $1,425,000 LJ Hooker Dickson </p>
<p>New South Wales </p>
<p>30 Bronte Marine Drive, Bronte, NSW 4 bed, 2 bath, 3 car house $7,350,000 Phillips Pantzer Donnelley Woollahra </p>
<p>26 Gold Street, Blakehurst, NSW 5 bed, 4 bath, 4 car house $4,100,000 Belle Property South Hurstville</p>
<p>Northern Territory </p>
<p>61 Gsell Street, Wanguri, NT 4 bed, 2 bath, 2 car house $615,000 Ray White Darwin </p>
<p>4 Finlayson Street, Gillen, NT 3 bed, 2 bath, 3 car house $492,500 Elders Real Estate Alice Springs </p>
<p>Queensland </p>
<p>121 Towers Street, Ascot, Qld 4 bed, 3 bath, 2 car house $2,300,000 Ngu Real Estate East Brisbane </p>
<p>586 Lower Bowen Terrace, New Farm, Qld 4 bed, 3 bath, 2 car house $2,100,000 Ray White New Farm </p>
<p>South Australia </p>
<p>29 Glenburnie Avenue, Torrens Park, SA 5 bed, 3 bath, 4 car house $1,586,000 Harcourts Platinum </p>
<p>48 Howard Street, Beulah Park, SA 5 bed, 3 bath, 3 car house $1,368,000 Ouwens Casserly Adelaide </p>
<p>Tasmania </p>
<p>58 Lyttleton Street, East Launceston, Tas 4 bed, 2 bath, 2 car house $745,000 Sims for Property Launceston </p>
<p>49 Bayside Drive, Lauderdale, Tas 4 bed, 2 bath, 2 car house $740,000 Knight Frank Hobart </p>
<p>Victoria </p>
<p>107 Mont Albert Road, Canterbury, Vic 4 bed, 1 bath, 2 car house $6,290,000 Jellis Craig Boroondara Group </p>
<p>15 Howitt Street, Glen Iris, Vic 4 bed, 3 bath, 2 car house $3,010,000 Kay Burton Hawthorn </p>
<p>Western Australia </p>
<p>36 Balikpapan Avenue, Dianella, WA 5 bed, 2 bath, 2 car house $1,200,000 Excellence Property Specialists </p>
<p>5/26 Renwick Street, South Perth, WA 3 bed, 2 bath, 2 car unit $900,000 Porter Matthews Metro Belmont </p>
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Top two sales over the past week across Australia: CoreLogic

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<p>Over the 12 months to May 2016 it is estimated that there were 338,785 houses and 131,339 units sold nationally with house sales 4.1 percent lower and unit sales 10.3 percent lower over the year, according to CoreLogic head of research Tim Lawless.</p>
<p>In the June market update he said across the combined capital cities there were an estimated 207,565 houses and 95,583 units sold over the 12 months to May 2016, with house sales 6.4 percent lower over the year while unit sales are down 12.5 percent.</p>
<p>Watch the video in full <a href="https://www.youtube.com/watch?v=TjkHOQlUr0M" target="_blank">here</a>.</p>
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House sales lower over 2016, unit sales down: CoreLogic June market update

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<p>T<span style="line-height: 1.3em;">he Museum of Contemporary Art director, Liz Ann Macgregor, best know for her colourful tartan wardrobe, is swapping inner Sydney terrace living for the lower north shore.</span></p>

<p><span>With partner Peter, Liz Ann has quietly bought in Cremorne, a freestanding 1910 Federation Arts and Crafts two storey home costing a tad over $3 million. Four double bedrooms, three suitably with large built-ins.</span></p>

<p><span>Their combined 1890s Thompson Street Darlinghurst terraces have sold for $2.05 million through Ray White agent Gavin Rubinstein, a nice gain having been bought five years earlier for $1.64 million.</span></p>

<p><span>[smartcode_project:default project_id=5910]</span></p>

<p><em>This article was first published in the Daily Telegraph.</em></p>
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jchancellor-FAypfDUnLy

MCA's Liz Ann Macgregor modernises Sydney home

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<p><span style="line-height: 1.3em;">CoreLogic RP Data's Top 10 suburbs for highest proportion of house auction listings over the last financial year only has one entrant from Melbourne, the other nine in Sydney.</span></p>
<p><span style="line-height: 1.3em;">Only Melbourne's Clifton Hill features at number eight with 84 listings and 78 total </span>auction<span style="line-height: 1.3em;"> </span>listings<span style="line-height: 1.3em;">. Sydney's Queens Park leads the </span>list<span style="line-height: 1.3em;"> with 60 total listings and 59 </span>actions<span style="line-height: 1.3em;"> followed by the </span>suburb of Clovelly (49 total listings, 47 auctions) and Malabar (23 total listings, 22 auctions).</p>
<p><a href="/images/2015/08/20/Screen%20Shot%202015-08-20%20at%2011.36.54%20AM.png" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2015/08/20/Screen%20Shot%202015-08-20%20at%2011.36.54%20AM.png" alt=""></p>
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mick.cee-iDmgDDAmu8

Top 10 suburbs for highest proportion of house auction listings: CoreLogic RP Data

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<p>An increase in population and income are two demand influencers on high dwelling rents and prices, according to the directors of Real Estate Research and Teaching for the UNSW Business School.</p>
<p>According to Nigel Stapledon's<span style="line-height: 1.3em;"> submission to the House of Representatives Standing Committee on Economics inquiry into Home Ownership, the rise in house prices it is not only happening in Australia, but all over the world. This is due to low interest across the world.</span></p>
<p><span style="line-height: 1.3em;">"In the period 1993-2003, population grew at a 1.1% annual pace, in the period 2003-13, it averaged 1.6%. At the margin, that extra 0.5% per annum is a very significant difference. This surge in population also changed expectations about future population growth, which in turn influenced expectations about future rent growth. If buyers expect the future rate of rent growth to be higher, that justifies higher prices." </span></p>
<p><span style="line-height: 1.3em;">It is his belief that foreign buyers add to the pressure on prices, but the effect in the long term is not permanent.</span></p>
<p>"The broader point is that Australia is a major beneficiary of its open door to foreign capital. In the long term, Australia’s reputation as a secure, transparent place to invest is a positive. Apart from anything it lowers the cost of capital for governments, business and individuals. If we start imposing controls to help manage perceived short term problems, that will put that reputation at risk."</p>
<p>Taxation policy is not as important as the demand factors mentioned before. Nigel Stapledon says that a more efficient tax system is desirable but is not what affects housing.</p>
<p>"The real debate on the question of housing affordability is on the question of supply. There are a number of angles to this. </p>
<p><span>"</span>In economics, the margin is what matters. On the demand side, an increase in population growth rate from 1.1% to 1.6% per annum in the period 2003–13 caused rents to rise substantially. </p>
<p>"Allowing for age composition effects, potential household formation lifted from 1.4% to 1.8%. That small marginal change mattered a lot. Because supply lagged in its response, most of the initial action was in higher rents, which worked to subdue demand (more young adults - potential new households – for example stayed at their parents’ home). </p>
<p>"In period 2003-13, the stock of dwellings in Australia grew by an average 1.6% per annum – only slightly slower than potential household formation but the cumulative effect matters. With a lag, complicated by some big intervening events e.g. GFC (Global Financial Crisis), we are now seeing supply respond in a more substantial way. </p>
<p>"In 2014 new completions increased the dwelling stock by 1.8%, and in 2015 and 2016 the pipeline of starts tells us that rate of growth will be running at a 2.0% pace. Bearing in mind that population growth has now slowed to a 1.4% pace (household formation below 1.6%), then clearly the demand-supply equation is shifting towards buyers/renters. The evidence of that is the deceleration in rent growth evident in 2014. It is the indicator to watch in 2015. </p>
<p>"But imagine if the stock were to increase by more like 3% (double the normal) in 2015. That order of magnitude increase in supply would require lower rents/prices to encourage more households (those young adults staying at home) back into the market. Otherwise, there would be a lot of vacant new dwellings. </p>
<p>"As the city’s population grows, if the green zone is unchanged, what urban economic theory tells us is that when the constraint becomes binding that the increase in demand will cause the price of land to rise. In response, buyers will choose smaller amounts of land consistent with the policy-makers’ desire for increased density. </p>
<p>"While less land is used, which partially offsets the higher price per unit of land, it is only a partial offset and the price of housing rises. For the pre-existing stock of houses, the price rises and their owners (owner-occupiers and landlords) enjoy a capital gain. </p>
<p>"The binding constraint will lead to pressure for some relaxation. To the extent that policy-makers relent and rezone some of the greenbelt land, the owners of that land will achieve significant capital gains. This leads to significant resources going into lobbying and a propensity for corruption. </p>
<p>"The second policy option is to impose a development tax. This lifts the price of land and in response we again see smaller lots and increased density. If the tax is set at the right level, the same degree of increased density can be achieved as with quantitative controls. </p>
<p>"One advantage of the development tax is that the development tax captures the capital gain which would be earned by owners of greenbelt land which is rezoned. A second advantage is that it keeps the market for land competitive. </p>
<p>"I would note that constraints on higher density building in inner urban areas will also constrain supply and lead to higher rents/prices across the urban area. There are many such restrictions. For example the recent decision in NSW to impose a minimum size on apartments of 35 square metres will add to the cost of housing. </p>
<p>"The cost of commuting (both in dollars and in time) is the most significant influence on the cost of land within cities. The higher are commuting costs from the urban fringe, the more valuable is living in the inner urban areas where commuting costs are low. </p>
<p>"As a city grows, there is a need to add to the transport capacity (wider roads, more rail lines). If governments fail to expand the transport infrastructure, congestion rises and lifts commuter costs. </p>
<p>"There is strong advocacy for public/social housing, which represents less than 3% of the housing stock, to be a much bigger part of the market. At its peak in 1971, public housing represented closer to 6% of total housing stock. </p>
<p>"There is a place for public housing but do young Australians see it as the answer to their future housing needs. I suspect they all aspire to something better. It is seen as a safety net. </p>
<p>"Aspirations aside, public housing is heavily subsidised. And as the cost of housing rises in a city, so too does the cost of subsidising public housing. It follow that policies which make the cost of private housing lower also lowers the cost to the taxpayer of providing any given amount of public housing."</p>
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Aussies aspire to more than public housing

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<div>As a mainly passive investor in equities these days I must admit that I don't pay a huge amount of attention to the daily machinations of the share markets.</div>
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<div>That said, judging from the number of angst-ridden articles about why shares must be the way to go and definitely not property I'd say it's a fair assumption that Aussie share markets are now tanking again.</div>
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<div>And taking a look at the charts, yep, pretty much.</div>
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<div>Having briefly threatened to get back up to 6,000 after nearly eight years of trying the ASX 200 (XJO) is now deflating miserably again, all the way back down 5356.50.</div>
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<div>The technicals are looking rather shocking too.</div>
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<div><a href="/images/2015/08/17/imageChart.axd.gif" target="_blank">Click to enlarge</a></div>
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<div><img src="/images/2015/08/17/imageChart.axd.gif" alt=""></div>
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<div>
<strong><span style="text-decoration: underline;">Property markets divergent</span></strong><br><br><span>Meanwhile, what's been happening in property markets since 2007?</span><br><br><div>The Reserve Bank of Australia (RBA) released its latest <a href="https://www.rba.gov.au/chart-pack/index" target="_blank">Chart Packs</a> during the first week of August recording the latest housing prices.</div>
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<div>As I expected, beyond the financial crisis the rising tide of household debt could no longer lift all boats, and so far capital growth has been strongest in the two largest capital cities, but considerably weaker elsewhere. </div>
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<div>Drivers of markets going forward will include jobs growth, population growth, real wages growth and foreign capital, among a number of other factors. </div>
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<div><span>Predictably the Sydney property market has been the clear standout, with house prices in round numbers having appreciated by <span>~</span>$400,000 (from <span>~</span>$550,000 to <span>~</span>$950,000), or more than a <span>~</span>70 per cent increase. </span></div>
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<div>The line denoting Sydney would look far steeper if it wasn't for the fact the RBA switched from using a linear scale to a log scale at the end of the first quarter.</div>
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<div><a href="/images/2015/08/17/6bl-houspri-small.gif" target="_blank">Click to enlarge</a></div>
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<div><img src="/images/2015/08/17/6bl-houspri-small.gif" alt=""></div>
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<div>At the other end of the scale, Adelaide's median house price has appreciated by around <span>~</span>$100,000 from <span>~</span>$350,000 to <span>~</span>$450,000, or close to a <span>~</span>30 per cent increase.</div>
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<div>Regional house prices in aggregate showed the lowest price growth of under $100,000, the chart following a very similar trajectory to that of Adelaide. </div>
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<div>In Brisbane median house prices are below their 2010 peak according to <em>CoreLogic-RP Data</em>(albeit only very marginally) but are now rising. </div>
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<div><span>For my money, Brisbane offers the best "value" of any of the capital city markets, though investors need to be particularly careful about what they are buying, for the reasons well documented here previously. </span></div>
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<div><span><span>The trendline below which records investor loans on a 12mMA basis shows that Queensland investor lending in aggregate is now tracking at its highest level since April 2008 and rising.</span></span></div>
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<div><span>Click to enlarge</span></div>
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<div><span><img src="/images/2015/08/17/A2.jpg" alt=""></span></div>
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<div>
<div><strong><span style="text-decoration: underline;">Shares and property</span></strong></div>
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<div>I wouldn't get too bogged down in the whole shares versus property debate, given that these are two fundamentally very different asset classes, both of which have their place in an investment portfolio. </div>
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<div>For average investors equities are often best viewed primarily as an income investment (just as well given that there has been no capital growth for close to a decade). </div>
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<div>A fundie would justly argue that through skilful stock selection they can beat the market consistently, thereby justifying their fees. </div>
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<div>That's fair enough.</div>
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<div>The same is true of property markets, really. </div>
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<div>Median house price growth across Australia has been fairly mixed in recent years, with Adelaide, Hobart, Perth and Brisbane recording almost no nominal price growth at all since their respective 2010 peaks.</div>
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<div>That said, property investors can and do aim to beat median house price growth with quality asset selection.</div>
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<div>I can think of at least a hundred ways in which it's possible to steal an edge on imperfect property markets, one of which is alluded to above - buying counter-cyclically. </div>
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<div>Another way to manufacture growth is through renovation.</div>
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<div>Over the long term a few other tactics might include buying property which is:</div>
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<div>-located within a 15 minute commute of the centre a large and growing capital city;</div>
<div>-in a land-locked suburb;</div>
<div>-within a 5 minute walk to a hard rail link or hub;</div>
<div>-comprised of a high land value; and</div>
<div>-an asset type which is in exceptionally high demand but has scarcity value.</div>
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<div>There are a great many others, of course. </div>
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<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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pwargent-M4siyDbqQY

Steal an edge on imperfect property markets: Pete Wargent

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<p><span>House sales have trended higher while units sales have tapered according to CoreLogic RP Data's Housing Market and Economics Update for August.</span></p>
<p><span>The report found to May this this year 352,012 houses have been sold, up 2.5% from the same time last year.</span></p>
<p><span>131,922 units have been sold this year, a 7.7% decline from the same period in 2014.</span></p>
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<p><a href="/images/2015/08/13/Screen%20Shot%202015-08-13%20at%201.42.38%20PM.png" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2015/08/13/Screen%20Shot%202015-08-13%20at%201.42.38%20PM.png" alt=""></p>
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