<p><a href="https://www.apartments.com.au/developments/broadbeach-qld-4218">Broadbeach</a> offers plenty of reasons to live vertically, but moving from a substantial family home into an apartment can expose the compromises of high-density living. Privacy, room for guests and usable living space tend to matter more when an apartment is intended as a permanent home rather than an occasional coastal base.</p>

<p>A typical residential floor at <a href="https://www.apartments.com.au/new-apartments/the-eveleigh-broadbeach-7-9-surf-parade-broadbeach-qld-4218">The Eveleigh</a>, on Surf Parade,&nbsp;contains just four apartments. The 94-residence development by <a href="https://www.apartments.com.au/developers/hirsch-faigen">Hirsch &amp; Faigen</a> is predominantly made up of expansive three-bedroom homes, with a limited collection of half-floor penthouses above.</p>

<p>Across the apartment floors, <a href="https://www.apartments.com.au/architects/rothelowman">Rothelowman</a> has used the relatively limited number of residences to give each home greater access to natural light and outlook. Living spaces extend towards full-height glazing, while a series of bay windows frame selected views across the Pacific Ocean, city and hinterland rather than treating the building edge as a continuous wall of glass.</p>

<p>&nbsp;</p>

<p>[smartcode_project:default project_id=149670 project_image_fid=360965]</p>

<p>“The apartment floors deliver a collection of homes that embrace controlled outlook via a series of bay windows deliberately framing moments of view,” Rothelowman Director Kim Lowman said.</p>

<p>From outside, those projecting forms contribute to the tower’s faceted profile. Strong horizontal and vertical elements establish its proportions, while the changing position of the sun alters the light, shadow and reflection across the façade throughout the day.</p>

<p>The same attention moves inside the apartments, where the material palette combines warm timber, natural stone, metallic detailing and softer curved forms. Kitchens sit within the main living zone, with stone island benches, integrated joinery and European appliances, before the living areas extend towards the glazing and the outlook.</p>

<p>&nbsp;</p>

<p>[smartcode_project:default project_id=149670 project_image_fid=360981]</p>

<p>Three genuine bedrooms provide room to accommodate family and guests, while two secure car spaces and storage address some of the practical considerations that can become more noticeable when moving from a larger home. Feedback from the display suite has centred on the warmth and restraint of the interiors, with buyers commenting that the residences feel like homes rather than conventional coastal apartments.</p>

<p>A limited collection of half-floor penthouses occupies the upper levels, increasing the scale of the living spaces and adding private balconies and elevated finishes. From this position, the outlook extends between the ocean and hinterland.</p>

<p>Outside the private residences, The Eveleigh separates its shared spaces between the podium and rooftop. The podium is centred on wellness, with subtropical landscaping surrounding a swimming pool and pool terrace, yoga garden, private gymnasium, sauna and hot and cold plunge facilities. Landscaped retreats and pavilions provide additional places to sit away from the main recreation areas.</p>

<p>&nbsp;</p>

<p>[smartcode_project:default project_id=149670 project_image_fid=360966]</p>

<p>Higher in the building, a rooftop pavilion and private dining suite sit alongside resident lounge, barbecue and outdoor dining areas, opening towards panoramic views across the ocean, city and hinterland.</p>

<p>“Buyers are no longer just looking for an apartment, but a lifestyle where they can relax, reset, and enjoy a balanced way of living,” Hirsch &amp; Faigen Director of Sales Matt George said.</p>

<p>Interest to date has come from established owner-occupiers and interstate lifestyle purchasers, including buyers planning a future move to the Gold Coast. Many are coming from larger homes and want to reduce ongoing maintenance without giving up space for family and guests, privacy, two car spaces or the ability to entertain at home.</p>

<p>&nbsp;</p>

<p>[smartcode_project:default project_id=149670 project_image_fid=360969]</p>

<p>Much of that daily life can also take place beyond the building without requiring a drive. Kurrawa Beach and Pratten Park are an easy walk from Surf Parade, while Pacific Fair, Oracle Boulevard, The Oasis, restaurants, cafés, entertainment and public transport are also within walking distance.</p>

<p data-end="8307" data-start="8063">The Eveleigh is Hirsch &amp; Faigen's fourth Gold Coast development since entering the market in 2021, following The Hemingway at Palm Beach, The Emerson at Kirra and Yves at Mermaid Beach. Each of the preceding projects sold out before completion.</p>

<p data-end="8543" data-start="8312">“Broadbeach had been on our radar throughout our time operating on the Gold Coast,” the developer said. “Following our projects in Palm Beach, Kirra and Mermaid Beach, Broadbeach represented the natural next step for the business.”</p>

<p data-end="8915" data-start="8548">The Surf Parade site brought together proximity to the beach, protected coastal outlooks and walkability to dining, shopping and recreation. Hirsch &amp; Faigen also identified the street as an emerging premium residential address, with enough separation from Broadbeach's busier destinations to retain a quieter environment at home.</p>

<p>The Eveleigh is now under construction by Maxcon, with completion forecast for mid-2028. Three-bedroom residences are currently available from $2.87 million.</p>

<p>[smartcode_project_cta:default project_id=149670]</p>


Joel Robinson

The Eveleigh brings house-like apartments to Broadbeach

<p>A long-stalled Campbelltown development site is back in play, with new plans for 139 apartments set to supersede a mixed-use scheme approved almost a decade ago but never built.</p>

<p>The new proposal for 28 Cordeaux Street would deliver 116 market and 23 affordable apartments in a part 14-storey building, bringing a substantial new project into a Campbelltown market where new apartment supply remains limited.</p>

<p>Plans have been filed over the 3,092 sqm corner site at Moore-Oxley Street, around 600 metres from Campbelltown Railway Station and the city-centre retail core.</p>

<p>The site already carries a mixed-use residential approval dating to 2016. Doroch Architects has now been engaged on a larger replacement scheme, which is progressing as a State Significant Development Application following a Housing Delivery Authority determination in August 2025.</p>

<p>The apartment mix comprises 39 one-bedroom, 72 two-bedroom and 28 three-bedroom residences. Two-bedroom apartments make up just over half of the project, while three-bedroom homes account for 20 per cent.</p>

<p><img alt="First look: New 139-apartment plans revive long-stalled Campbelltown city centre site" data-entity-type="file" data-entity-uuid="136dd5b9-3791-4da6-9e31-76f533f5b4de" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Campbelltown%20da2.png?VersionId=LgOSy9nwf5u.MGswBBwaGGxuX8QpHSl_" /></p>

<p>Of the 139 apartments, 23 will be delivered as affordable housing under the in-fill affordable housing provisions of the Housing SEPP. The affordable component represents 15 per cent of the residential gross floor area and will be managed by a registered Community Housing Provider.</p>

<p>Doroch has sought to break the scale of the building into two distinct elements, with a masonry podium of around four storeys establishing the street edge before the residential tower steps back above.</p>

<p>The corner position has shaped that approach. Cordeaux Street faces toward the commercial and civic centre, while Moore-Oxley Street leads into the lower-scale residential neighbourhood to the south, and the design verification report describes the site as "bridging the commercial core to the north and established residential areas to the south."</p>

<p>The podium will be expressed predominantly in face brick, while the upper levels shift to brushed and grooved concrete cladding with darker metal detailing. Recessed sections, deep balcony edges and landscaping break down the upper form, with an approximately 11.8-metre setback to the northern boundary addressing the adjoining St Peters Anglican School.</p>

<p><img alt="First look: New 139-apartment plans revive long-stalled Campbelltown city centre site" data-entity-type="file" data-entity-uuid="c8b3d2d3-c561-4bfc-a5d9-a68c0c10dac1" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Campbelltown%20da1.png?VersionId=AeAEyJU02Gk2k5noUj2StziCvdQ7fW4B" /></p>

<p>Campbelltown has been starved of new residential developments in the last decade.</p>

<p>The only other notable development set to come to market this year is ALAND's Queen Square, a mixed-use precinct on over two hectares that will comprise apartments above a vibrant ground-level retail and hospitality dining precinct.</p>


First look: New 139-apartment plans revive long-stalled Campbelltown city centre site

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<p>A 60-apartment building nine storeys tall would be a rarity almost anywhere along this stretch of Moreton Bay, but that's exactly what's been lodged for a modest Deception Bay street better known for its single-storey weatherboard homes.</p>

<p><a href="https://www.apartments.com.au/developers/sherlock-construction-homes">Sherlock Construction Homes</a> is seeking to push Deception Bay’s emerging medium-density housing profile higher, lodging plans for a nine-storey apartment building near the suburb’s shopping centre and foreshore.</p>

<p>Dubbed Grosvenor Apartments, the proposal at 14-20 Grosvenor Terrace would replace two detached homes with a new building designed by&nbsp;<a href="https://www.apartments.com.au/architects/mode">Mode Design</a>&nbsp;which would&nbsp;reach nearly 30 metres, well above the site’s mapped 21-metre building height.</p>

<p><img alt="First Look: Sherlock Construction pitches 9-storey tower for low-rise Deception Bay" data-entity-type="file" data-entity-uuid="86c21a25-5a97-4ca7-a361-80757137ea5b" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Deception%20da%20front.png?VersionId=aXIujfvEhH33sLHOEjHFv9Ii6qxSvAF4" /></p>

<p>The apartment mix is weighted toward larger homes, with 14 three-bedroom apartments, 31 two-bedroom apartments and 15 one-bedroom apartments. Six apartment types are spread across the floors, ranging from 66 sqm one-bedroom units through to three-bedroom apartments of 116 sqm, most with private balconies or terraces.</p>

<p>Levels one through seven follow a consistent layout of six to eight apartments per floor arranged around a central lift and stair core, with the top floor, level eight, trading one apartment for a landscaped community breakout space rather than repeating the standard layout below.</p>

<p>Ground floor is dedicated to arrival and services, with a lobby, mailroom and manager's office, alongside 91 car spaces.</p>

<p><img alt="First Look: Sherlock Construction pitches 9-storey tower for low-rise Deception Bay" data-entity-type="file" data-entity-uuid="b098bde0-5fe1-4e6c-9601-e5446612e5fc" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Deception%20podium.png?VersionId=A0hfENMNxSxkfh9Jl6D4WJ9XIraeOukA" /></p>

<p>Mode Design's brief describes a "serene coastal-inspired design blending soft curves, natural textures and light-filled spaces to reflect the relaxed Deception Bay lifestyle."&nbsp;</p>

<p>The material palette leans on white and grey render, timber-look aluminium screening and stacked-brick-look finishes, with hanging greenery and vine planting proposed across balcony edges and ground-level walls.&nbsp;</p>

<p>Balconies feature asymmetrical geometries intended to vary the building's rhythm rather than repeat a single module up the tower, while lush planting is concentrated over the entry and level one balconies to soften the building's base.</p>

<p><img alt="First Look: Sherlock Construction pitches 9-storey tower for low-rise Deception Bay" data-entity-type="file" data-entity-uuid="c05c5693-3e00-42d0-b075-55c36094f4db" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Deception%20da%201.png?VersionId=cMKJgBsBaaVCd2dA5O22SOT38OT_.BPA" /></p>

<p>The design evolved following an April 2025 prelodgement meeting with council. At that stage, the project was conceived as a seven-storey building containing 45 apartments. The subsequently lodged scheme increases the development to nine storeys and 60 apartments while introducing one-bedroom residences to the mix.</p>

<p>Zone Planning argues the additional scale reflects the site's position within an area earmarked for increased residential intensity. The planning report points to the North Lakes-Redcliffe-Moreton Bay Rail corridor strategy, which identifies Deception Bay as a district-level activity centre and supports greater housing choice within urban neighbourhoods.</p>

<p>Market Square Deception Bay, Deception Bay Sports Centre, Deception Bay State School, public transport, community facilities and the Moreton Bay foreshore are all identified within approximately one kilometre of the site, while the property falls within a 400-metre walking catchment of Market Square.</p>

First Look: Sherlock Construction pitches apartments for low-rise Deception Bay

<p data-end="587" data-start="368">Queensland builder-developer MAYD has revealed the first look at its major North Kirra beachfront development, lodging amended plans that reduce the number of apartments and increase the proportion of larger residences.</p>

<p data-end="778" data-start="589">The project is planned across a substantial 4,742 sqm amalgamated site spanning seven lots at <a href="https://www.apartments.com.au/new-apartments/2-6-pacific-parade-bilinga-qld-4225">2-6 Pacific Parade</a> and 27-33 Golden Four Drive in Bilin​ga, directly opposite Nor​th Kirra Beach.</p>

<p data-end="907" data-start="780"><a href="https://www.apartments.com.au/developers/mayd-group">MAYD</a> secured the site for $32.5 million in 2025, in what was one of the Gold Coast's largest property transactions of the year.</p>

<p data-end="1052" data-start="909">The development will be delivered across two stages, with the first stage carrying an estimated gross realisation value of around $360 million.</p>

<p data-end="1311" data-start="1054">The latest amendments seek to reduce the overall apartment count and shift the project further toward the owner-occupier market, with larger residences designed for buyers wanting considerably more space than traditionally offered in a beachfront apartment.</p>

<p data-end="1451" data-start="1313">The residential mix will include townhomes, oversized two-bedroom apartments, substantial three-bedroom residences and four-bedroom homes.</p>

<p data-end="1676" data-start="1453">MAYD has appointed Cera Stribley to lead the architecture and interiors, with the Melbourne-based design practice drawing on the beachfront setting through a series of ocean-facing terraces and heavily landscaped balconies.</p>

<p data-end="1908" data-start="1678">Strong horizontal forms and curved balconies will define the exterior, with subtropical landscaping integrated throughout the building to soften the built form and increase the connection between the residences and the beachfront.</p>

<p data-end="2142" data-start="1910">The project will also include an extensive collection of resident wellness and lifestyle facilities, continuing the broader shift across the Gold Coast's luxury apartment market toward larger homes supported by resort-style amenity.</p>

<p data-end="2142" data-start="1910"><img alt="MAYD" data-entity-type="file" data-entity-uuid="d1bcbb05-e659-4b47-8bd4-1e595315e2ad" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-27%20at%202.05.03%E2%80%AFPM.png?VersionId=jj0XEud1X1DuLt7_KyElhjMdZGOXmLHP" /></p>

<p data-end="2308" data-start="2144">MAYD Founder Todd Mould said North Kirra was increasingly appealing to buyers attracted to the more established, lower-density character of the southern Gold Coast.</p>

<p data-end="2648" data-start="2310">"North Kirra presents one of the most compelling luxury residential opportunities currently emerging in Australia, combining absolute beachfront with the character and authenticity that buyers are increasingly seeking, and the same sense of tight-knit community that defined Burleigh and Currumbin perhaps 10 or 15 years ago," Mould said.</p>

<p data-end="2797" data-start="2650">"With Gold Coast Airport on its doorstep, it also offers a level of accessibility that broadens its appeal across almost every market demographic."</p>

<p data-end="2938" data-start="2799">The project comes as the southern Gold Coast continues to attract an increasing share of high-end apartment development and buyer activity.</p>

<p data-end="3216" data-start="2940">Kirra in particular has emerged as one of the region's more tightly held beachfront markets, with its relatively low-density character, established surf and hospitality scene and proximity to Gold Coast Airport differentiating it from the higher-density markets further north.</p>

<p data-end="3325" data-start="3218">Mould said those characteristics had informed the approach MAYD and Cera Stribley had taken to the project.</p>

<p data-end="3442" data-start="3327">"We've worked closely with Cera Stribley to create a vision that is deeply connected to its surroundings," he said.</p>

<p data-end="3662" data-start="3444">"Inspired by the coastline itself, the architecture has been shaped around space, privacy and resort-style living, creating a collection of homes that reflects the next generation of luxury on the southern Gold Coast."</p>

<p data-end="3818" data-start="3664">MOTIV Managing Director Carly Cottam, who has been appointed to market the project, said buyer attention had continued to move south along the Gold Coast.</p>

<p data-end="4076" data-start="3820">"Purchasers who may once have defaulted to Broadbeach, Main Beach or Surfers Paradise are increasingly recognising the value of a genuine beachfront location that offers lower density, strong amenity and a more established sense of community," Cottam said.</p>

<p data-end="4375" data-start="4078">"Kirra has a powerful combination of growing demand and genuine scarcity. Beachfront supply is inherently constrained, the area remains relatively low density, and buyers are increasingly placing a premium on locations that feel established, uncrowded and authentic rather than heavily developed."</p>

<p data-end="4503" data-start="4377">Cottam said the proximity to Gold Coast Airport was also proving increasingly important for interstate and second-home buyers.</p>

<p data-end="4741" data-start="4505">"Being minutes from Gold Coast Airport makes it particularly compelling for interstate buyers, frequent travellers and second-home purchasers who can access an authentic coastal lifestyle almost immediately after stepping off a flight."</p>

<p data-end="4910" data-start="4743">The acquisition takes MAYD's active development portfolio to more than $500 million, with the North Kirra project representing one of its largest undertakings to date.</p>

<p data-end="4951" data-start="4912">MAYD is targeting an early 2027 launch.</p>


First look at MAYD's North Kirra mixed-use precinct

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<p data-end="600" data-start="394">Castle Hill, the longtime hub of the Hills District, has been one of the major beneficiaries of Sydney's Metro expansion, with improved connectivity helping drive continued population growth, development and buyer demand across the Hills District.</p>

<p data-end="733" data-start="602">But despite that growth, the suburb has seen relatively few major new apartment projects brought to market over the past 18 months.</p>

<p data-end="970" data-start="735">Hills District developer Reve Group is looking to fill that gap with <a href="https://www.apartments.com.au/new-apartments/nova-r-ve-castle-hill-2-garthowen-crescent-castle-hill-nsw-2154">Nova Rêve</a>, a major new mixed-use precinct on the corner of Garthowen Crescent and Old Castle Hill Road, a short walk from Castle Hill Metro Station and Castle Towers.</p>

<p data-end="970" data-start="735">[smartcode_project:default project_id=152737 project_image_fid=377679]</p>

<p data-end="1159" data-start="972">The project will comprise three residential towers alongside a hotel, restaurants, cafes and a skybar, more than 1,600 sqm of ground-floor retail and almost an acre of landscaped gardens.</p>

<p data-end="1357" data-start="1161">It represents the largest project undertaken by Reve Group, the development arm of the Kassis family, which has been building across the Hills District for more than 30 years through Kassis Homes.</p>

<p data-end="3400" data-start="3216">[smartcode_project:default project_id=152737 project_image_fid=377675]</p>

<p data-end="3400" data-start="3216">Nova Rêve also represents a significant step up from the family's first apartment development, Grand Rêve, which was delivered nearby on Garthowen Crescent.</p>

<p data-end="1664" data-start="1517">Grand Rêve introduced larger, house-like apartment layouts and premium inclusions including Wolf and Sub-Zero appliances to the Castle Hill market.</p>

<p data-end="1826" data-start="1666">Nova Rêve takes that approach to a precinct scale, combining the residential component with hospitality, retail and substantial public and resident landscaping.</p>

<p data-end="1826" data-start="1666">[smartcode_project:default project_id=152737 project_image_fid=377685]</p>

<p data-end="2045" data-start="1828">Reve Group Managing Director Sam Kassis said the project reflected the family's three decades of building in the Hills, which has evolved from trophy homes on quarter-acre blocks to larger-scale apartment development.</p>

<p data-end="2269" data-start="2047">"Grand Rêve was our first apartment project here and it showed us what this pocket of Castle Hill could be. Nova Rêve is the refinement of that idea: not just apartments, but a place the whole suburb can use," Kassis said.</p>

<p data-end="2430" data-start="2271">A key part of that approach is the hotel, which has been designed to operate as an amenity for the wider Castle Hill community rather than solely hotel guests.</p>

<p data-end="2606" data-start="2432">It will include restaurants, cafes, skybars and all-day dining, alongside conference and event facilities catering to business functions, community groups and private events.</p>

<p data-end="2724" data-start="2608">At ground level, more than 1,600 sqm of shops and cafes will open onto the surrounding streets and landscaped areas.</p>

<p data-end="2892" data-start="2726">Almost an acre of gardens designed by Land and Form Studios will run through the precinct, incorporating pathways, seating, barbecue areas and children's play spaces.</p>

<p data-end="2892" data-start="2726">[smartcode_project:default project_id=152737 project_image_fid=377680]</p>

<p data-end="3004" data-start="2894">Reve Group's Romio Georges said creating an active ground plane had been central to the planning of Nova Rêve.</p>

<p data-end="3214" data-start="3006">"There are gardens with pathways, barbecues, seating and play areas, shops and cafes opening onto the street, and a hotel with restaurants and a skybar that anyone in Castle Hill can walk into," Georges said.</p>

<p data-end="3400" data-start="3216">The project's elevated position on one of Sydney's highest ridgelines will also provide apartments with outlooks toward the Sydney skyline, surrounding parkland and the Blue Mountains.</p>

<p data-end="3400" data-start="3216">More than 80 per cent of the apartments will occupy corner positions, with Turner responsible for both the architecture and interiors.</p>

<p data-end="3670" data-start="3538">&nbsp;</p>

<p data-end="3670" data-start="3538">[smartcode_project_cta:default project_id=152737]</p>

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Nova Rêve arrives as Reve Group bets on Castle Hill's next growth phase

Housing Finance

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<p>Earlier this week, housing finance data for August 2016 was released by the Australian Bureau of Statistics (ABS). </p>
<p>Over the month there was $31.4 billion worth of housing finance commitments which was -1.0 percent lower over the month and -5.1 percent lower than it was at its peak in April 2015.</p>
<p><a href="/images/2016/10/13/chart-1-580x211.jpg" target="_blank">Click to enlarge</a></p>
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<p>The $31.4 billion worth of commitments in August was split between $19.5 billion worth of commitments by owner occupiers and $11.9 billion in commitments to investors.</p>
<p>The value of lending to owner occupiers has fallen over two consecutive months while lending to investors has risen for the fourth consecutive month.  The value of lending to owner occupiers is now -8.6 percent lower than its peak in December 2015. </p>
<p>Investor lending remains well below its April 2015 peak, down -18.5 percent however, the recent rebound has seen the value of investor lending increase by 10.0 percent from its recent trough in April 2016.</p>
<p><a href="/images/2016/10/13/chart-2-580x210.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/10/13/chart-2-580x210.jpg" alt=""></p>
<p>The $19.5 billion worth of mortgage borrowing by owner occupiers was comprised of: $1.8 billion for construction of dwellings, $1.0 billion for purchase of new dwellings, $6.4 billion for refinancing of established dwellings and $10.2 billion for purchase of established dwellings. </p>
<p>The two largest components of owner occupier lending; refinancing and purchase of established dwellings, have both trended lower over recent months. </p>
<p>The value of refinance lending is -13.4 percent lower than its peak of $7.4 billion in December 2015 and purchase of established dwellings is -11.2 percent lower than its $11.5 billion peak in September 2015. </p>
<p>With an interest rate cut which wasn’t passed on in full by most lenders in August, there is a decent probability that refinance activity will increase over the coming months.</p>
<p><a href="/images/2016/10/13/chart-3-580x211.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/10/13/chart-3-580x211.jpg" alt=""></p>
<p>For investors there was $11.9 billion in mortgage lending in August 2016, which was split between $0.9 billion in lending for construction and $11.1 billion for established housing. </p>
<p>The value of lending for construction was at its lowest level since September 2015 and down -49.5 percent from its recent peak of $1.7 billion in March 2016. </p>
<p>The $11.1 billion in lending for established housing has increased over four consecutive months and is at its highest level since August 2015. </p>
<p>Housing credit data also highlights the recent up-tick in investor mortgage lending with monthly investor credit data increasing over each of the five months to August 2016.</p>
<p><a href="/images/2016/10/13/chart-4-580x214.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/10/13/chart-4-580x214.jpg" alt=""></p>
<p>Focusing solely on new construction which includes owner occupier construction of dwellings, owner occupier purchase of new dwellings and investor lending for construction, there was $3.7 billion in lending in August 2016. </p>
<p>The $3.7 billion was the lowest value of lending for new housing since September 2015 with lending for new housing having trended lower since March 2016.  Based on this data, only 14.9 percent of the total value of housing finance commitments in August 2016 were for new housing. </p>
<p>Of the $3.7 billion, 23.1 percent of lending was to investors.</p>
<p>The trends ae emerging whereby demand from the investment segment is increasing again while owner occupier demand is slowing. Although investment demand is lifting, it is not expected to lift to the substantial levels recorded earlier in the current housing cycle. </p>
<p>The fading demand from owner occupiers reflects that many have already upgraded or downgraded in the current cycle as much as the fact that particularly in Sydney and Melbourne it is probably getting a little harder to justify a move in the context of significant transactional costs. </p>
<p>When owners look at the cost of upgrading and the market exit cost (agent commission etc) and entry costs (stamp duty) many are probably now considering a renovation as a better option than moving.</p>
<p>Housing market listings have increased in spring and over recent months auction volumes and clearance rates have also increased.  It will be interesting to see whether this translates into a lift in housing finance commitments over the coming months as the data becomes avaialable.</p>
<p><em>Cameron Kusher is research analyst for CoreLogic. You can contact him <a href="https://blog.corelogic.com.au/about/">here</a>.</em></p>
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ckusher-ujnxiKuFQs

Investor housing demand rises as owner occupier fades: CoreLogic

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<div>GUEST OBSERVER</div>
<div> </div>
<div>I recently wrote here how it looked as though new home finance had shaped into quite a neat double top formation.</div>
<div> </div>
<div>In November, finance for new owner-occupier purchases increased a bit, but overall the trendline does suggest that a second peak is forming. </div>
<p><a href="https://www.propertyobserver.com.au/images/2017/01/23/A1.jpg" target="_blank">Click to enlarge</a></p>
<div class="separator"><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/2017/01/23/A1.jpg" alt=""></div>
<p><br><span>The slight rebound ties in with the rebound in new home sales in the month, previously noted </span><a href="https://petewargent.blogspot.co.uk/2017/01/new-home-sales-rebound" target="_blank">here</a><span>.</span><br><br><strong><span style="text-decoration: underline;">Mainly investors buying new</span></strong><br><br><span>It's often said that investors mainly invest in established housing, with charts produced to prove it.</span><br><br></p>
<div>Of course, with the total dwelling stock only increasing by less than 2 per cent over the year to September 2016 to 9.76 million, it stands to reason that most investors will buy established - there just aren't that many new properties in any given year. </div>
<div> </div>
<div>I have been more interested to know what percentage of the new housing stock was purchased by owner-occupiers, but nobody I have asked seems to know (or even care about) the answer.</div>
<div> </div>
<div>The housing finance figures show that owner-occupiers financed the construction of only 68,200 homes and the purchase of just 31,490 dwellings. </div>
<div> </div>
<div>What the housing finance figures don't capture is that some owner-occupier buyers of new homes are cash buyers.<br><br>But nevertheless, it's clear that largely the buyers of new dwellings are investors, albeit many of them from overseas.</div>
<div> </div>
<div><em><span>PETE WARGENT </span>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></div>
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pwargent-M4siyDbqQY

New housing finance is topping out: Pete Wargent

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<p>GUEST OBSERVER</p>
<p>The Australian Bureau of Statistics (ABS) released lending finance data earlier today and when it is paired with the earlier housing finance data release, the figures provide insight into the value of mortgage lending over the month in each state and territory. </p>
<p>Over recent months investor demand for mortgages has been trending higher and this is being largely driven by resurgent investor demand in New South Wales and Victoria. </p>
<p>Of course the capital cities of these two states have consistently recorded the strongest value growth of all capital cities over the past five years and also have the lowest rental returns.</p>
<p><a href="https://www.propertyobserver.com.au/images/2017/01/25/chart-1-3.jpg" target="_blank">Click to enlarge</a></p>
<p><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/2017/01/25/chart-1-3.jpg" alt=""></p>
<p>The data analysed is based on the value of mortgage finance commitments. </p>
<p>Given this it is important to consider that more expensive markets (such as NSW) will tend to result in borrowers taking out larger mortgages whereas borrowers in more affordable markets will generally take out smaller mortgages.  More than half of all the mortgage lending to investors in November 2016 was lent in New South Wales and with a further 24.5 percent in Victoria, three quarters of all mortgage lending to investors occurred in the two most populous states.</p>
<p><a href="https://www.propertyobserver.com.au/images/2017/01/25/chart-2-3.jpg" target="_blank">Click to enlarge</a></p>
<p><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/2017/01/25/chart-2-3.jpg" alt=""></p>
<p>Looking only at new lending (that is excluding refinances) investors accounted for 56.7% of the value of lending in New South Wales in November 2016.  Looking over the past four years, the value of new lending to investors in New South Wales has been greater than new owner occupier lending for 42 of the past 48 months. </p>
<p>Victoria was previously seeing slightly more than 50% of new lending to investors but was recorded at 45.0% in November 2016.  Across the remaining states and territories, the proportion of total new lending to investors in November 2016 was recorded at: 39.7% in Queensland, 37.1% in South Australia, 31.0% in Western Australia, 26.1% in Tasmania, 40.3% in the Northern Territory and 38.7% in the Australian Capital Territory.</p>
<p>It’s clear that demand for mortgages from the investor segment is picking up, particularly in New South Wales and Victoria, which are proxies for Sydney and Melbourne respectively.  With a low cost of borrowing and many owner occupiers having seen substantial increases in housing equity in Sydney and Melbourne over the past 4.5 years it is easy to understand why investor demand is rising. </p>
<p>On the other side of things, you have a value growth phase that has now run for 4.5 years, largely focussed on two major cities and rental returns at historic low levels in these cities.  Investors should be considering the potential risks, especially as housing supply is responding and that the value growth phase is now quite mature.  While many have seen a substantial increase in the value of properties and may continue to do so, at some point growth will slow. </p>
<p>With record low yields, slow rental growth and additional housing supply entering the market over the coming years, if investors need to start relying on rental returns rather than increase in the asset value, boosting those returns is likely to prove difficult.</p>
<p><em>Cameron Kusher is research analyst for CoreLogic. You can contact him <a href="https://blog.corelogic.com.au/about/">here</a>.</em></p>
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New lending to investors in NSW has accounted for more than half of all new lending for 42 of the past 48 months: Cameron Kusher

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<p>EXPERT OBSERVER</p>
<p>Total housing finance was lower as expected back in August at $30.67 billion in seasonally adjusted terms, well down from the peak of above $34 billion a year earlier.</p>
<p>The Reserve Bank of Australia posted some useful insights on household finances, financial stress (or rather the lack of it), and the impact of tighter lending standards on loan sizes.</p>
<p>The RBA doesn't always help itself when citing very old data, but made some handy insights on borrowing capacity, specifically noting how most loans are made significantly below borrowing capacity.</p>
<p>In the surveyed figures only about 13 per cent borrowed 90 per cent or more of the maximum amount potentially available, while some two-thirds borrowed only 70 per cent or less of their capacity (thereby implying that tighter lending standards only impact some borrowers).</p>
<p>This was to some extent borne out by the housing finance data, with average loan sizes having continued to rise for owner-occupiers to be significantly higher than a year earlier, including in all three of the most populous states.</p>
<p>The borrowers most likely to be materially impacted by tighter lending standards include portfolio investors, and this is also reflected in the totals for investment loans.</p>
<p>The monthly trend result for investment loans has fallen from $14 billion at the 2015 peak to $10 billion, suggesting that the best performing properties are likely to be those actively sought by homebuyers (and the worst, investment units designed primarily for leasing).</p>
<p>More interest-only loans were reset in the third quarter.</p>
<p>Non-banks have been picking up more business, as expected.</p>
<p>With construction loans and the number of new dwellings financed now in decline new supply will be dropping off in time.</p>
<p>First homebuyers continued to account for about 18 per cent of new home loans, partly driven by incentives.</p>
<p><em>PETE WARGENT is the co-founder of AllenWargent property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank">blogger</a>.</em></p>
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Housing finance squeezed in August: Pete Wargent

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<div>I took a look at the Housing Finance figures for December previously. In this post, I'll just add a few sundry thoughts.<br><br>There are always plenty of angles put forward for why the housing market must be struggling, or will be set to struggle in due course, true enough.<br><br>And indeed, some locations are struggling, no question about that - mainly comprising mining towns, or regions being heavily impacted by the ongoing collapse in mining investment.<br><br>Anecodotally, mortgage lending has also perhaps been a little bit slower in January. </div>
<div> </div>
<div>It was interesting to note, however, that the raw original data (without seasonal adjustments applied) recorded $35,961,746,000 of dwelling finance commitments in the month of December, an increase of $2.3 billion or +6.7 per cent from one year ago.</div>
<div> </div>
<div>I'm no incurable optimist, but there's not too much wrong with the health of the lending market on that evidence. In fact it was the highest figure ever recorded for a single month.</div>
<div> </div>
<div><a href="/images/2016/02/15/A7.jpg" target="_blank">Click to enlarge</a></div>
<p><img src="/images/2016/02/15/A7.jpg" alt=""> </p>
<p><span><span>Refinancing is evidently a complicating factor, as you can see in the chart above, but the value of loans actually advanced in December was up by +24.6 percent to its highest ever level at $23.8 billion.</span></span><br><br><span>I noted on </span>Twitter<span> last week that the average loan size figures seemed to have gotten a little ahead of themselves, and sure enough there was a pullback in December to a somewhat more believable $377,600, althought this is still +11.2 per cent higher than one year ago, and the figure still looks rather overstated. </span></p>
<p><a href="/images/2016/02/15/A2.jpg" target="_blank"><span>Click to enlarge</span></a></p>
<p><span><img src="/images/2016/02/15/A2.jpg" alt=""></span></p>
<p> </p>
<p><strong><span style="text-decoration: underline;">Construction continues</span></strong><br><br></p>
<div>Much has also been written about the imminent downturn in residential construction sector. </div>
<div> </div>
<div>In one sense this is a truism since construction activity is also now tracking at its highest every level, and clearly this dynamic cannot continue in perpetuity. </div>
<div> </div>
<div>However, the most recent housing finance figures suggested that there is still a fair amount of juice in the tank. </div>
<div> </div>
<div>The rolling annual value of commitments for investor construction, which is a handy indicator if not anything more concrete than that, is up by +27.6 percent from one year ago. The equivalent figure for owner-occupier purchase of new dwellings is up by +15.7 percent.</div>
<div> </div>
<div><a href="/images/2016/02/15/A4.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/02/15/A4.jpg" alt=""></div>
<div> </div>
<div><span>The number of commitments for new dwelling purchase also jumped in December to 3,579 in original terms, and you would have to go back a long, long way to find a stronger monthly result than that. </span></div>
<div><span> </span></div>
<div><a href="/images/2016/02/15/A6.jpg" target="_blank"><span>Click to enlarge</span></a></div>
<div><span><img src="/images/2016/02/15/A6.jpg" alt=""></span></div>
<div> </div>
<div> </div>
<div><span>Major renovation activity has been marginally improved in recent months from 2014 levels, but in reality this has been almost exclusively a Sydney trend through this cycle to date. </span></div>
<div><span> </span></div>
<div><a href="/images/2016/02/15/A3.jpg" target="_blank"><span>Click to enlarge</span></a></div>
<div><span><img src="/images/2016/02/15/A3.jpg" alt=""></span></div>
<div> </div>
<div> </div>
<div>
<strong><span style="text-decoration: underline;">First time buyers are active</span></strong><br><br><div>The latest figures showed an increase in first homebuyer owner-occupier activity of +4.6 percent to 15.1 percent of all loans written. </div>
<div> </div>
<div><a href="/images/2016/02/15/A1.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/02/15/A1.jpg" alt=""></div>
</div>
<div><span> </span></div>
<div><span><span>If you include first time buyer investors from industry surveys, the total figure for first time buyers is tracking around 50 per cent higher than this.</span><br><br><strong><span style="text-decoration: underline;">The wrap</span></strong><br><br><span>Overall, it is clear that there has been a behavioural shift between lenders and borrowers towards favouring owner-occupier mortgages over investment loans, the lines between which have become hopelessly blurred.</span><br><br><span>The headline figures show that in aggregate housing finance remained relentlessly strong through 2015, even if some mining regions are feeling the burn.</span><br><br><span>According to CoreLogic-RP Data Sydney posted Very solid preliminary auction clearance rate of 78.6 per cent from 469 auctions, well ahead of the preliminary clearance rate for Melbourne at 72.6 per cent.</span><br><br><span>Vendors seem a bit more realistic, and these are still relatively low volumes. Most signs point to a steady Sydney market in 2016.</span><br><br><span>Westpac's forecasts for economic growth from 2015 to 2017:</span></span></div>
<div><span><span> </span></span></div>
<div><a href="/images/2016/02/15/GROWTH.jpg" target="_blank"><span><span>Click to enlarge</span></span></a></div>
<div><span><span><img src="/images/2016/02/15/GROWTH.jpg" alt=""></span></span></div>
<div> </div>
<div> </div>
<div>
<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>
</div>
<div><span><span> </span></span></div>
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Housing market in good health: Pete Wargent

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<div>At the headline level it was another spirited month for housing finance nationally, with the seasonally adjusted $32.6 billion in October being the sixth greatest month on record following a lending blitz through 2015.</div>
<div> </div>
<div>Although owner-occupier commitments increased again in the month, investor finance continued to slump, dropping by 6.1%.</div>
<div> </div>
<div><a href="/images/2015/12/9/HF1.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2015/12/9/HF1.jpg" alt=""></div>
<div> </div>
<div>
<div>The devil of this data series forever lies within the detail, with a number of sources indicating that there has been a level of jiggery-pokery with regards to the classification of loans between owner-occupiers and investors (since there is now a clear price incentive to opt for homebuyer loans).</div>
<div> </div>
<div>The second chart below shows that owner-occupier commitments and refinancing have both increased solidly, while APRA's macroprudential measures have ensured that investor finance is now falling away quickly.</div>
<div> </div>
<div>The net result was that total housing finance in trend terms remained flat in the month at $33.2 billion.</div>
<div> </div>
<div><a href="/images/2015/12/9/HF2.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2015/12/9/HF2.jpg" alt=""></div>
<div> </div>
<div>
<div>Whether or not housing markets can push forward in 2016 will depend upon the extent to which the growth in owner-occupier loans can offset declining investor lending. </div>
<div> </div>
<div>Certainly we can see that the number of owner-occupier loans is trending up, but equally there is a chance that tightening mortgage rates could slow this sector of the market going forward.</div>
<div> </div>
<div><a href="/images/2015/12/9/HF3.jpg" target="_blank">Click to enlarge</a></div>
<div> </div>
<div><img src="/images/2015/12/9/HF3.jpg" alt=""></div>
<div> </div>
<div>
<strong><span style="text-decoration: underline;">State versus state</span></strong><br><br><div>Skipping down to the state level we can see that the trend number of owner-occupier commitments is in decline in Western Australia, Tasmania, the Northern Territory, and Queensland, which is home to a significant number of declining regional markets in line with the resources investment collapse.</div>
<div> </div>
<div>The trend in the number of owner-occupier commitments in the Australian Capital Territory has been stone dead flat for months.</div>
<div> </div>
<div>The increase in the number of mortgages written has been driven purely by the two most populous states, New South Wales and Victoria. </div>
<div> </div>
<div><a href="/images/2015/12/9/HF4.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2015/12/9/HF4.jpg" alt=""></div>
<div> </div>
<div>
<div>Generally speaking the higher value loans are written in the capital cities, and as such the dollar value of owner-occupier commitments tends to be a better indicator of what is playing out in the capitals.<br><br>In terms of the trend <strong>value</strong> of owner-occupier commitments, both Western Australia and the Northern Territory are again in decline. </div>
<div> </div>
<div>The Brisbane market is faring relatively well at the present time, helping to nudge the aggregate value of owner-occupier commitments in Queensland steadily up, while Victoria and New South Wales in particular are rising fast.</div>
<div> </div>
<div>In fact, trend monthly owner-occupier commitments in New South Wales have ripped up the chart to sit some 43 per cent higher over the year at more than $8 billion (awooga!).</div>
<div> </div>
<div><a href="/images/2015/12/9/HF5.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2015/12/9/HF5.jpg" alt=""></div>
<div> </div>
<div><span>As noted, when it comes to housing finance the devil is always in the detail: more than $3 billion of the New South Wales monthly figure related to refinancing, and over the past year there has also been a slight uptick in finance for renovations.</span></div>
<div><span> </span></div>
<div><a href="/images/2015/12/9/HF6.jpg" target="_blank"><span>Click to enlarge</span></a></div>
<div><span><img src="/images/2015/12/9/HF6.jpg" alt=""></span></div>
<div> </div>
<div> </div>
<div>
<div>
<strong><span style="text-decoration: underline;">The wrap</span></strong><br><strong><span style="text-decoration: underline;"><br></span></strong>
</div>
<div>Overall, there are many more different trends to cover than can be analysed in one blog post - it was a solid result nationally, and it all rather depends upon which market you are interested in.</div>
<div> </div>
<div>One thing that we can say with certainty is that the investor boom is a cooked goose for this cycle, with investor finance now down by 9.2 per cent year-on-year. In 2016, the homebuyer sector of the market will swim back into focus.</div>
<p> </p>
<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>
</div>
</div>
</div>
</div>
</div>
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Investor boom is a cooked goose: Pete Wargent

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<div>Following APRA's actions to slow investor lending, annual credit growth in this sector has fallen very sharply over the past 9 months from 11 percent to 7 percent, with undoubtedly more declines to come.</div>
<div> </div>
<div>The Reserve Bank's Financial Aggregates figures for March showed that housing credit has continued to switch its focus towards homebuyers, with annual owner-occupier credit growth increasing to a 66-month high of 7.2 percent.</div>
<div> </div>
<div>The net result is that annual housing credit growth has gradually moderated to 7.2 percent, from a cyclical peak of 7.5 percent six months previously.</div>
<p><a href="/images/2016/05/02/A1.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/05/02/A1.jpg" alt=""></p>
<p><br><span>Overall credit growth in the economy has also eased back to an annual pace of 6.2 per cent. </span></p>
<p><a href="/images/2016/05/02/A2.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/05/02/A2.jpg" alt=""></p>
<p><br><strong><span style="text-decoration: underline;">Business and banking</span></strong></p>
<div>Business credit growth notched up a result of only 0.3 per cent growth for the month, with the annual pace of growth steady at 6.5 per cent.</div>
<div> </div>
<div>This mirrors softening trends suggested elsewhere such as in the ABS lending finance data series, while initial and secondary capital raised on the securities exchange has also slowed in 2016.</div>
<div> </div>
<div><a href="/images/2016/05/02/A4.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/05/02/A4.jpg" alt=""></div>
<div> </div>
<div>The cost of business funding is at a record low, but research has shown that expected returns and hurdle rates can be a more important driver of business or project funding decisions.</div>
<div> </div>
<div>In terms of bank lending and funding, although growth in term deposits has been understandably weak in the prevailing low interest rate environment, the growth in other bank deposits has been hugely strong.</div>
<div> </div>
<div>Combined with equity raisings this means that banks will have few problems meeting their funding requirements in 2016, strong deposit growth and capital raised helping to offset any moderate rising in funding costs.</div>
<p><a href="/images/2016/05/02/a3.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/05/02/a3.jpg" alt=""></p>
<p> </p>
<div>Bank funding costs declined significantly in 2015 in any event, and sit way below the levels seen in 2012 or during the financial crisis.</div>
<div> </div>
<div><strong><span style="text-decoration: underline;">Housing and outstanding credit</span></strong></div>
<div> </div>
<div>Although the pace of growth has slowed a notch, overall outstanding housing credit has continued to power higher to $1.55 trillion.</div>
<div> </div>
<div>The composition of housing credit has shifted dramatically over the past eight months, with the investor share of outstanding credit having fallen by fully 3 per cent over that timeframe, a remarkably rapid shift in market dynamics exacerbated by loan reclassifications.</div>
<div class="separator"> </div>
<div class="separator"><a href="/images/2016/05/02/A5.jpg" target="_blank">Click to enlarge</a></div>
<div class="separator"><img src="/images/2016/05/02/A5.jpg" alt=""></div>
<div class="separator"> </div>
<div>One other curious observation is how personal credit is actually now in decline. <br><br>One wonders whether this is related to the growth in the use of mortgage buffers and offset accounts, as it is certainly very unusual to see personal credit going backwards in Australia, even with mortgage repayments at such low levels for many existing homeowners.</div>
<p><a href="/images/2016/05/02/A6.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/05/02/A6.jpg" alt=""></p>
<div>Total credit increased by 1.5 percent or $38 billion in the first quarter of 2016 to a grand total of $2.54 trillion.</div>
<p><strong><span style="text-decoration: underline;">The wrap</span></strong></p>
<p><span style="line-height: 1.3em;">Overall, the result was pretty much as expected on all fronts, with tightening measures restricting the annual growth in housing credit somewhat over the past six months to 7.2 per cent, and total credit growth a bit steadier at 6.4 percent.</span></p>
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Annual housing credit growth moderating: Pete Wargent

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<p>Each fortnight I update my chart of the titles registry figures for Queensland, although I don't post the results here all that often.</p>
<p>When figures aren't seasonally adjusted, it pays to be wary of drawing conclusions from individual weeks or months of data. </p>
<p>After all how many times have new home sales figures "peaked" in this cycle, or how may times has housing finance "tanked", or buying intentions "cratered", or consumer confidence been "smashed", and so on?</p>
<p>Every other month in each case, pretty much. </p>
<p>By drilling trendlines through the titles registry figures you can see that Queensland's mortgage and transfers market has ground its way through a long, slow recovery since bottoming around late 2011. </p>
<p><a href="https://www.propertyobserver.com.au/images/2017/03/15/QLD1.jpg" target="_blank">Click to enlarge</a></p>
<div id="post-body-8620627539950330204" class="post-body entry-content">
<div class="separator"><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/2017/03/15/QLD1.jpg" alt=""></div>
<div> </div>
<div>There was a blip in activity following APRA's initial salvo of macroprudential measures - and part of the increase in activity relates to a surge in multi-unit construction - but for now the uptrend in activity remains in place. </div>
<br><div><strong><span style="text-decoration: underline;">Brisbane land values rise</span></strong></div>
<div> </div>
<div>The Queensland Government updated its annual land valuations for 2017 last week, which showed a very wide range of outcomes across the state.<br><br>The post-2012 malaise continues apace across many of the resources regions.<br><br>There was more excruciating news for Gladstone which recorded another massive 20.6 per cent drop in median land values (although the Mayor kindly noted that residents shouldn't expect a reduction in their rates bill).<br><br>Over the past four years Gladstone land values have recorded losses of -5.4 per cent, -14.6 per cent, -4.8 per cent, and -20.6 per cent respectively.<br><br>Brutal, with land prices declining to just $113,000,<br><br>Dwelling prices have often seen drops of well over 50 per cent since 2012, and in many case rents have fallen by at least an equivalent amount.<br><br>The news wasn't much brighter in Mackay which racked up a third year of declines, and the Central Highlands saw land values fall for a fourth year, while Rockhampton saw land prices fall by 8.7 per cent from the preceding valuation date.<br><br>Townsville has also recorded moderate declines across the last five years.<br><br>There were bright spots, though, with the Gold Coast recording another year of recovery, and land prices notching up solid gains in Brisbane City Council (BCC), with the usual variances at the suburb level.</div>
<div> </div>
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<br>It is wise to exercise caution in interpreting suburb level median land values, not least because the Queensland Government rather likes to see those rateable land values rising for all-too-obvious reasons (though rates aren't based only on land valuations, the Government assures us!).<br><br>Changes in land use resulting from the BCC 2014 City Plan may also potentially skew the results in suburbs with increasing multi-unit development, for example.<br><br>Nevertheless, the figures are well worth a look, for the Valuer-General's figures logically cannot diverge too far from the reality over the long run.<br><br>Residential land values increased across some 132 Brisbane suburbs over the past year according to the 2017 report, although there were some declines in commercial and industrial valuations on the city fringe, according to the Valuer-General.<br><br>Over the past couple of years the greatest dollar value increases have largely been seen in the inner suburbs where land values are highest.<br><br>The following suburbs, for example, saw their median residential land values increase by $100,000 or more in only two years: New Farm, West End, Windsor, Wooloowin, Newmarket, Holland Park, Albion, Kedron, Annerley, Wilston, Carina Heights, and Carindale.<br><br>A vast wave of Chinese money has also seen Sunnybank and Sunnybank Hills notch outlandish increases in land values since 2014, the pocket known as Brisbane's "Little Asia".</div>
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<br>The largest two-year gains in percentage terms have been driven by a popular school catchment, however.<br><br>Suburbs located within the Mansfield State High School (SHS) catchment saw land prices rise by between 37 and 43 percent over the two-year period, including in the suburb of Mansfield itself, Wishart, Mackenzie, and Upper Mount Gravatt. </div>
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<p class="p1"><span class="s1">PETE WARGENT is the co-founder of <a href="https://allenwargent.com/"><span class="s2">AllenWargent</span></a> property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/"><span class="s2">blogger</span></a>.</span></p>
<p class="p2"><span class="s3"><em>His latest book is </em><a href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx"><span class="s2"><em>Four Green Houses and a Red Hotel</em></span></a><em>.</em></span></p>
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The good and the ugly behind Queensland's recovery: Pete Wargent

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<p><span>The Australian Bureau of Statistics (ABS) released housing finance data for July 2015 earlier this week.</span></p>
<p><span>Throughout July, there was $32.8 billion worth of housing finance commitments. This figure was comprised of $19.2 billion worth of commitments to owner occupiers and $13.6 billion in commitments to investors. Over the month, the total value of housing finance commitments increased by 1.5% to be 15.0% higher year-on-year.</span></p>
<p><a href="/images/2015/09/10/Chart-11.jpg" target="_blank"><span>Click to enlarge</span></a></p>
<p><span><img src="/images/2015/09/10/Chart-11.jpg" alt=""> </span></p>
<p><span><span>At $19.2 billion, owner occupier housing finance commitments increased by 2.2% over the month and were 13.9% higher year-on-year. Breaking the $19.2 billion into its components: $1.6 billion was for construction of dwellings, $1.1 billion was for the purchase of new dwellings, $6.2 billion was for refinances of established dwellings and $10.2 billion was for the purchase of established dwellings. Over the month, commitments for the construction of dwellings fell -1.5%, purchase of new dwellings rose 8.4%, refinances rose 3.3% and purchase of established dwellings rose 1.5%.  </span></span></p>
<p><span><span>Over the past 12 months the refinance segment has been the key driver of growth in the owner occupier lending segment with commitments up 23.7%. In comparison, year-on-year changes have been recorded at -7.6% for construction of dwellings, 15.4% for purchase of new dwellings and 12.6% for purchase of established dwellings. Recently growth in the owner occupier lending segment has been lacklustre, driven largely by refinances however, the 13.9% year-on-year rise in owner occupier housing finance commitments excluding refinances is the largest rise since February 2014.</span></span></p>
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<p><a href="/images/2015/09/10/Chart-21.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2015/09/10/Chart-21.jpg" alt=""></p>
<p>Turning to the investment segment of housing finance commitments, this has over recent years been a significant driver of new demand. In July 2015, investor housing finance commitments rose by 0.5% to be 16.5% higher year-on-year. If we look at the $13.6 billion in investment housing commitments across its components, $1.1 billion was for construction of new investment dwellings and $12.5 billion was for established homes. </p>
<p>Over the month, commitments for new construction rose 11.7% compared to a -0.4% fall in commitments for established homes. Year-on-year investor commitments for construction of new dwellings has increased by 81.5% compared to a 12.9% rise in the much larger segment for purchase of established investment homes.  The chart above shows the recent weakness in commitments for established homes and the ongoing rise in commitments for new construction.</p>
<p>It seems that there is a growing appetite for investment in off-the plan investment properties while demand for established investment stock is waning a little.  Despite the monthly rise in demand for investment lending, the rate of growth has started to ease as Australian authorised deposit-taking institutions (ADIs) tweak their lending policies in line with policy updates from APRA aimed at slowing growth in the pace of total investor housing credit.</p>
<p>Housing credit data for July 2015 showed that growth in owner occupier credit is ramping up while investor credit demand is potentially slowing. This release of housing finance data appears to support that notion. The ADIs will be hoping that they can entice additional activity from the owner occupier segment over the coming months as there is likely to be a slowdown in lending to the investment segment.</p>
<p>Housing finance data is continuing to rise however, it appears that growth is starting to tilt away from investors towards the owner occupier segment. Although regulators such as the Reserve Bank and APRA will be glad to see that exuberance from investment borrowers may be slowing, they will be very keen to monitor and ensure that any pick-up from owner occupier borrowers is not as a result of a relaxing of lending standards.</p>
<p>Both the housing credit and housing finance data will be closely monitored over the coming months in order to see if this transition continues. Specifically we will be watching whether housing credit can continue to increase its rate of growth and if new commitments continue to tilt away from investors towards owner occupiers and what impact that may have on housing finance demand.</p>
<p><em>Cameron Kusher is research analyst for CoreLogic RP Data. You can contact him <a href="https://blog.corelogic.com.au/author/cameron-kusher/" target="_blank">here</a>.</em></p>
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Housing finance commitments rise in July: Cameron Kusher

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<p><span style="line-height: 1.3em;">Housing finance data for January 2016 shows that the value of housing finance commitments was recorded at $31.9 billion over the month. </span></p>
<p>Based on this figure, mortgage lending fell by -3.4 percent over the month.  Even though the data is seasonally adjusted, we often see falls in mortgage lending over January so perhaps we need not read too much into the fall, however, this is the largest January fall in lending since 2011.</p>
<p><a href="/images/2016/04/15/Chart-1-1-580x213.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/04/15/Chart-1-1-580x213.jpg" alt=""></p>
<p>Looking at the two major components of mortgage lending: owner occupier and investors both have recorded a fall over the month. In January there was $20.5 billion worth of finance commitments to owner occupiers and $11.4 billion in commitments to investors. The value of owner occupier commitments fell by -4.3 percent over the month but was 15.9 percent higher year-on-year.</p>
<p>Investor commitments fell by -1.6 percent in January and were -14.8 percent lower year-on-year. With investor demand having slowed over recent months, they now account for 35.6 percent of all mortgage commitments which is virtually right on its decade average after peaking at 43.3 percent of all housing finance commitments in May of last year.</p>
<p><a href="/images/2016/04/15/Chart-21-580x210.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/04/15/Chart-21-580x210.jpg" alt=""></p>
<p>Of the $20.5 billion in commitments to owner occupiers in January, $1.9 billion was for construction of dwellings, $1.2 billion was for purchase of new dwellings, $7.2 billion was for refinancing of established dwellings and $10.2 billion was for the purchase of other established dwellings.  Construction of dwellings was the only segment of lending to rise over the month (+0.7 percent) with falls in value of lending for purchase of new dwellings (-5.2 percent), refinancing established dwellings (-2.3 percent) and purchase of other established dwellings (-6.4 percent). </p>
<p>Despite monthly falls, year-on-year all segments have seen an increase in lending with construction of new dwellings rising 6.1 percent, purchase of new dwellings up 35.6 percent, refinances up 36.0 percent and purchase of other established dwellings having increased by 4.8 percent.  Although lending is up over the past year, there is a clear downwards trend in owner occupier lending, particularly for established dwellings, over recent months.  It will important to monitor whether this trend persists in coming months as it could point to slowing value growth.</p>
<p><a href="/images/2016/04/15/Chart-3-1-580x213.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/04/15/Chart-3-1-580x213.jpg" alt=""></p>
<p>Following intervention in the market by the regulator, we have seen a sharp slowdown in lending to the investment segment over the past 8 months.  As earlier mentioned, investors accounted for 43.3% of all housing finance commitments in May of last year with their proportion falling to 35.6% in January 2016.  Looking at the two components, in January 2016 there were $899 million worth of commitments for new construction and $10.5 billion worth of commitments for established housing stock. </p>
<p>Over the month, the value of commitments fell by -4.2% for new construction and by -1.4% for established housing stock.  Year-on-year the value of lending is 3.2% higher for new construction but -16.0% lower for established stock.  Much like the owner occupier chart, it shows that demand for established stock has eased and is trending lower, albeit at a slower pace.  In fact, the value of commitments for established investment stock is at its lowest level since April 2014.</p>
<p><a href="/images/2016/04/15/Chart-4-1-580x215.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/04/15/Chart-4-1-580x215.jpg" alt=""></p>
<p>The CoreLogic Mortgage Index which is published weekly and tracks mortgage activity across our proprietary platforms indicates that January was a weak month for housing finance commitments.  We would expect that housing finance commitments will rise in February and so far March also points to increasing demand.  However, mortgage demand remains lower than it was at the end of last year and lower than it was a year ago.  While housing finance commitments should increase from their January levels it is unlikely that demand will start to grow as strongly as it was in the early part of last year or late in 2015.</p>
<p>The constraints on investment lending have been extremely effective and have resulted in a swift and significant pull-back in demand, in fact the value of investment housing finance commitments in January was -20.0% lower than its April 2015 peak.  Although the CoreLogic Mortgage Index points to a rebound in demand over the coming months, we expect that growth in housing finance commitments will remain more subdued than what we saw over recent years. </p>
<p>Of course, the direction of housing finance will ultimately be determined by housing demand.  After demand weakened over the second half of 2015 we have seen stronger demand early in 2016 with much stronger auction clearance rates falling property listings in a number of cities and a rise in property transactions.</p>
<p><em>Cameron Kusher is research analyst for CoreLogic RP Data. You can contact him <a href="https://blog.corelogic.com.au/about/">here</a>.</em></p>
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