<p>One of North Sydney's best-known commercial buildings could become hundreds of new homes, with insurance giant Zurich Australia lodging a State Significant Development Application (SSDA) to transform 5 Blue Street into a mixed-use residential development above North Sydney Station.</p>

<p>Rather than demolishing the existing building and starting again, Zurich is proposing an adaptive reuse project that would convert the landmark office building into a 15-level residential development delivering 62 apartments, 86 affordable co-living dwellings, activated retail and significant upgrades to the Blue Street Plaza.</p>

<p>The proposal reflects a growing trend of commercial property owners repositioning ageing office assets into residential housing as Sydney grapples with housing supply shortages and changing workplace demand.</p>

<p><img alt="Zurich" data-entity-type="file" data-entity-uuid="0bba7d12-06dc-4375-aad7-238c94b21ac5" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-22%20at%2010.42.05%E2%80%AFAM.png?VersionId=NJl5oLAEBDGuPmY3RnyliKODjMc8lvRh" /></p>

<p>Located directly above North Sydney Metro and train station, the 3,051 sqm site occupies one of the most strategically positioned parcels of land on Sydney's Lower North Shore.</p>

<p>Designed by fjcstudio, the proposal seeks to retain and adapt much of the existing structure while creating a contemporary residential address that better connects with the public domain surrounding North Sydney Station.</p>

<p>The application proposes two basement levels, ground floor retail, affordable co-living accommodation across the podium levels, and apartments above, while preserving and enhancing the publicly accessible Blue Street Plaza.</p>

<p>Rather than pursuing maximum apartment numbers, Zurich has opted for a housing mix heavily weighted towards larger owner-occupier residences.</p>

<p>The proposal includes 62 build-to-sell apartments comprising 12 one-bedroom, 19 two-bedroom, 29 three-bedroom apartments and two premium penthouses. It also incorporates 86 affordable co-living dwellings, which would be managed in perpetuity by a Community Housing Provider.</p>

<p>That balance between traditional apartments and affordable housing reflects the NSW Government's push to increase housing diversity around major transport infrastructure.</p>

<p>The proposal has been lodged concurrently with a rezoning application, with Zurich arguing the site is ideally positioned to support additional housing given its immediate proximity to public transport, employment and services.</p>

<p>"The proposal aims to respond to the housing challenges facing Sydney through the delivery of diverse housing types in a highly accessible location," the design report by fjcstudio states. It also seeks to improve pedestrian amenity through upgrades to Blue Street Plaza while creating a high-performing residential building that responds to the surrounding context.</p>

<p><img alt="Zurich" data-entity-type="file" data-entity-uuid="36082e15-c636-4481-bb68-5a5f6443fe39" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-22%20at%2010.41.36%E2%80%AFAM.png?VersionId=5P6VD.fvmqjQfIG3TWWMRXxQWiQBjeFB" /></p>

<p>Rather than replacing the commercial building, fjcstudio has developed a design that works with the existing structural framework above the rail corridor, an approach that significantly reduces demolition while allowing the site to be repositioned as a mixed-use residential precinct.</p>

<p>The existing structural constraints have informed much of the building's design, including its relationship with Blue Street and surrounding public spaces.</p>

<p>The building has been designed as a slender tower rising above a clearly defined podium, with vertically expressed façades intended to reduce the perceived bulk while reinforcing North Sydney's emerging skyline.</p>

<p>According to fjcstudio, the architectural language responds directly to the surrounding commercial towers while maintaining a finer grain expression more closely aligned with the neighbouring Lavender Bay streetscape.</p>

<p>The tower incorporates articulated façade elements, landscaped podium edges and recessed upper levels to soften its appearance and improve pedestrian amenity below.</p>

<p>A significant component of the proposal is the revitalisation of Blue Street Plaza.</p>

<p>The existing public space has long served as one of the primary pedestrian connections between North Sydney Station, Greenwood Plaza and Blue Street, yet its role is expected to become even more important following the opening of Sydney Metro.</p>

<p>Zurich's proposal seeks to strengthen that role by improving landscaping, introducing new retail frontages, enhancing pedestrian permeability and creating more active edges throughout the day and evening.</p>

<p>Ground floor retail would wrap the plaza, while separate residential and co-living entries have been designed to improve wayfinding without reducing street activation.</p>

<p>Landscape design has been integrated throughout the podium and public realm, softening what is currently one of the most heavily urbanised parts of North Sydney.</p>

<p>&nbsp;</p>

<p>&nbsp;</p>

<p>fjcstudio has carefully oriented apartments towards Sydney Harbour and the CBD while using privacy blades and articulated façades to minimise overlooking between neighbouring buildings.</p>

<p>Large framed openings along the western elevation maximise harbour outlooks, while the eastern apartments have been angled towards the south-east to improve privacy from neighbouring development.</p>

<p>The project forms part of the continuing transformation of North Sydney from a predominantly commercial CBD into a genuine mixed-use city centre.</p>

<p>Since the completion of Victoria Cross Metro Station, developers have increasingly shifted their attention towards residential projects capable of leveraging the area's unparalleled transport connectivity.</p>

<p>&nbsp;</p>

<p>FiveX recently lodged plans for a 61-storey, 490-apartment tower that would become one of the tallest residential buildings in North Sydney if approved.</p>

<p>Aqualand continues to expand its Lower North Shore presence following the completion of AURA on Walker Street and its recent St Leonards and Roseville proposals.</p>

<p>Developers are also progressing projects throughout Walker Street, Miller Street and the Victoria Cross precinct as demand for well-located owner-occupier apartments continues to strengthen.</p>


Joel Robinson

First look: Zurich targets North Sydney office conversion with 148-unit proposal above Metro station

<p>Busy developer Aqualand Prestige has formally taken the next step in its expansion across Sydney's Lower North Shore, lodging a State Significant Development Application (SSDA) for its long-held Archer Street site in Chatswood.</p>

<p>The application covers <a href="https://www.apartments.com.au/new-apartments/51-55-archer-street-chatswood-nsw-2067">51-55 Archer Street</a>, a 1,767 sqm amalgamated site on the eastern edge of the Chatswood CBD, where the developer is seeking approval for a 45-level mixed-use tower delivering 114 apartments, including a significant affordable housing component, alongside retail, commercial space and six basement levels of parking.</p>

<p>The SSDA marks the latest milestone for a project Aqualand has been quietly progressing over the past two years. The developer first secured the site for its Aqualand Prestige platform before undertaking an alternative design excellence process with PTW Architects, ultimately avoiding a formal design competition through the Housing Delivery Authority pathway.</p>

<p>The proposal has evolved considerably from Aqualand's original concept. The revised scheme has been designed around larger owner-occupier product, with an unusually high proportion of three and four-bedroom apartments, targeting the more affluent buyer profile, and downsizer, emerging across the North Shore.</p>

<p><img alt="Archer St" data-entity-type="file" data-entity-uuid="0171204c-5811-41b5-9b09-2335d1b7c3d0" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-22%20at%208.52.48%E2%80%AFAM.png?VersionId=6YTuxfq.puZo7k2wbfgemcO5K3QfXYGQ" /></p>

<p>The 114-apartment mix comprises six studios, 27 one-bedroom apartments, 18 two-bedroom apartments, 50 three-bedroom residences and 13 four-bedroom homes. A quarter of the building will be dedicated to affordable housing, well above the mandated 15 per cent&nbsp;</p>

<p>PTW has structured the building vertically, with affordable housing across levels one to six, premium apartments through levels seven to 31, duplex skyhomes on klevels 32 to 43, a penthouse on level 44, and a rooftop plant level above. Six basement levels will provide resident parking and servicing.</p>

<p>The tower is proposed to reach approximately 154 metres, placing it among a growing collection of residential high-rises transforming Chatswood's skyline.</p>

<p>Rather than competing purely on height, PTW says the design has been driven by creating a slimmer tower capable of delivering significantly larger apartments.</p>

<p>"The primary objective of this project was to create a distinctive building that stands out from the recently approved or built structures in the Chatswood area," the design report states, noting the structural efficiency allows greater investment into apartment quality and resident amenity.</p>

<p>Residents would have access to more than 450 sqm of communal open space including landscaped gardens, swimming pool, rooftop entertaining areas, fitness spaces, community gardens, children's play areas and barbecue facilities.</p>

<p>A major focus of the design has been the public domain.</p>

<p>The ground plane has been opened up through landscaped terraces inspired by Willoughby's sandstone ridges, with native planting, public seating, artwork, retail activation and a series of gathering spaces intended to soften what has traditionally been a hard commercial streetscape.</p>

<p>The landscape strategy references Blue Gum forests once common throughout the area, while incorporating Indigenous storytelling, public art and lighting installations to strengthen the connection to Country.</p>

<p data-end="239" data-start="66">Chatswood has been one of Sydney's busiest apartment markets over the past 12 months, with a steady pipeline of both new project launches and fresh development applications.</p>

<p data-end="442" data-start="241">Hyecorp recently launched Celine, a 122-apartment development just along Archer Street, while Changfa and Huirong Group are progressing The Anderson, an 84-apartment project on Anderson Street.</p>

<p data-end="661" data-start="444">Develotek recently secured approval for a 101-apartment tower on Pacific Highway, while Tian An LFD received the green light for Hammond Greens, its apartment development on the edge of the Chatswood Bowling Club.</p>

<p data-end="909" data-start="663">Commercial property developer FiveX is also making its move into the residential market. Last month it lodged plans for a 61-storey tower with 490 apartments, which, if approved, would become one of the tallest residential buildings in Chatswood.</p>

<p><em>Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/first-look-fivex-targets-chatswood-skyline-with-61-storey-tower-after-north-sydney-plans">First look: FiveX targets Chatswood skyline with 61-storey tower after North Sydney plans</a></em></p>

<p data-end="1339" data-start="1019">Aqualand is also expanding its development pipeline following the launch of its luxury residential brand, Aqualand Prestige. The developer has delivered a string of high-end apartment projects across Sydney's affluent suburbs over the past decade, most recently AURA by Aqualand on Walker Street in North Sydney.</p>

<p data-end="1339" data-start="1019">[smartcode_project:default project_id=30959 project_image_fid=292863]</p>

<p data-end="1398" data-start="1341">It has since quietly assembled its next wave of projects.</p>

<p data-end="1805" data-start="1400">Earlier this year Aqualand launched Boronia in Roseville, a boutique 111-apartment development on Larkin Street. The project is one of the first significant apartment developments to launch in the suburb ahead of what is expected to become one of Sydney's most active new housing precincts under the NSW Government's Low and Mid-Rise Housing reforms, which allow greater density around train stations.</p>

<p data-end="1805" data-start="1400">[smartcode_project:default project_id=152095 project_image_fid=373685]</p>

<p data-end="1991" data-start="1807">The developer has also lodged plans for a two-tower, 413-apartment development on Herbert Street in nearby St Leonards, further strengthening its presence across the Lower North Shore.</p>

<p data-end="2303" data-is-last-node="" data-is-only-node="" data-start="1993">Beyond that, Aqualand remains behind the final stage of Barangaroo, where plans will deliver a five-hectare mixed-use precinct comprising new homes, retail, hospitality and community facilities, alongside a new Metro entrance and more than two hectares of public open space, completing the Barangaroo precinct.</p>

<p><em>Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/central-barangaroo-development-takes-big-step-with-concept-proposal-approval">Central Barangaroo development takes big step with concept proposal approval</a></em></p>

<p><em>Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/first-look-aqualand-joins-st-leonards-apartment-party">First look: Aqualand joins St Leonards apartment party</a></em><br />
&nbsp;</p>

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<p>&nbsp;</p>


First look: Aqualand pushes ahead with Chatswood apartment tower as SSDA lodged for Archer Street

<p data-end="492" data-start="327">Mass timber is becoming an increasingly popular construction material in apartment developments, but Adelaide developer <a href="https://www.apartments.com.au/developers/otello">Otello</a> is taking the approach a step further.</p>

<p data-end="843" data-start="497">At its new <a href="https://www.apartments.com.au/new-apartments/flowe-bowden-18-gibson-street-bowden-sa-5007">Flowe Bowden</a> development, the exposed cross-laminated timber (CLT) structure isn't just about reducing the building's environmental footprint. It also forms the foundation of a broader wellness strategy, influencing everything from indoor air quality and natural materials to the way residents move through and experience the building.</p>

<p data-end="1109" data-start="848">The 115-apartment mixed-use development, designed by Melbourne-based architecture practice Fieldwork, will occupy a prominent island site opposite Bowden Village Reserve, combining one, two and three-bedroom apartments with retail and a dedicated wellness destination.</p>

<p data-end="1109" data-start="848">[smartcode_project:default project_id=152022 project_image_fid=375528]</p>

<p>Wellness isn't confined to a gym or shared resident facility at Flowe. Instead, Fieldwork embedded the concept into the building itself.</p>

<p>The development has been split into two residential wings connected by a naturally ventilated central breezeway, replacing traditional enclosed corridors with open-air walkways that improve natural light, encourage cross ventilation and create more opportunities for neighbourly interaction.</p>

<p>"Rather than treating wellness as something that only happens on the ground floor, our response integrates it throughout the building, which led us to ask what it really means to design a healthy building," Fieldwork Director Quino Holland said.</p>

<p>[smartcode_project:default project_id=152022 project_image_fid=375531]</p>

<p>The building's architecture also reflects Bowden's industrial heritage. The lower podium references the area's historic brick and sandstone buildings, while the upper levels transition to exposed CLT, allowing the timber structure to become a defining feature throughout the apartments and shared spaces.</p>

<p>The use of mass timber sits alongside a range of sustainability initiatives, including a fully electric, gas-free design, rooftop solar and a targeted 5 Star Green Star rating.</p>

<p>[smartcode_project:default project_id=152022 project_image_fid=375524]</p>

<p>Inside the residences, the focus remains on natural, durable materials. Blackbutt engineered timber flooring, exposed CLT ceilings, porcelain surfaces and warm timber joinery create a calming interior palette, while low-VOC finishes and responsibly sourced materials have been selected to improve indoor air quality.</p>

<p>Kitchens have been designed as the centrepiece of each apartment, featuring porcelain island benchtops, timber-look cabinetry and brushed steel tapware, with layouts that maximise natural light and ventilation.</p>

<p>[smartcode_project:default project_id=152022 project_image_fid=375530]</p>

<p>The more traditional interpretation of wellness comes in the form of Level Eleven, a two-storey wellness club spanning the ground floor, mezzanine and first floor.</p>

<p>The facility will include a gym, yoga and reformer Pilates studios, Finnish and infrared saunas, magnesium hot and cold plunge pools, and dedicated recovery spaces. Unlike many residential wellness facilities, Level Eleven will also operate commercially, allowing the broader Bowden community to access the venue while giving residents exclusive membership benefits.</p>

<p>The ground floor has also been designed around everyday living. A café overlooking Bowden Village Reserve will activate the street frontage, while a bike workshop with tool storage, co-working space and dog wash has been incorporated to support daily routines and encourage interaction between residents.</p>

<p>"Flowe brings together my two biggest passions, creating places and creating healthier lives," Otello founder Daniel Harris said.</p>

<p>"We wanted to create something Adelaide hasn't seen before, a genuinely healthy building, where the way you live is lifted without even trying."</p>

<p>Flowe is positioned directly opposite Bowden Village Reserve and within walking distance of Bowden Railway Station and the Adelaide Entertainment Centre, placing future residents just minutes from the Adelaide CBD while remaining connected to one of the city's most established urban renewal precincts.</p>

<p>[smartcode_project_cta:default project_id=152022]</p>


Otello launches wellness-focused Flowe Bowden with Adelaide-first mass timber apartment design

<p>Not all apartment amenities are immediately visible.</p>

<p>Swimming pools, gyms, rooftop terraces and residents' lounges have long featured on buyers' wishlists, but as the way Australians live has changed, so too have the features that make apartment living more convenient.</p>

<p>Increasingly, buyers are placing value on the practical aspects of day-to-day life. Fast internet, EV charging, secure bike storage, flexible workspaces and parcel management are becoming just as relevant as lifestyle amenities, reflecting changing habits and expectations.</p>

<p>Online shopping has been one of the biggest drivers of that shift.</p>

<p>Australians spent a record $82.6 billion shopping online in 2025, with almost one in every four retail dollars now spent digitally, making parcel deliveries a routine part of everyday life rather than an occasional convenience.</p>

<p>For apartment residents, however, receiving those deliveries isn't always straightforward.</p>

<p>Without someone home to accept a parcel, deliveries can be redirected to a nearby Post Office, left in building foyers or common areas, or require building management to temporarily store packages. As apartment living continues to grow across Australia's cities, parcel management has become an increasingly important consideration for both residents and developers.</p>

<p>Australia Post's Parcel Locker network is one response to that shift.</p>

<p><iframe allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" allowfullscreen="" frameborder="0" height="315" referrerpolicy="strict-origin-when-cross-origin" src="https://www.youtube.com/embed/KPZ9j5FRdsQ?si=Qztc1dNP3ZvEIUhb" title="YouTube video player" width="560"></iframe></p>

<p>Rather than relying on home delivery, eligible parcels can be directed to a nominated Parcel Locker, where they're securely stored until collected. Once a parcel arrives, residents receive a notification through the AusPost app or SMS and can retrieve it using a one-time code or QR code at a time that suits them.</p>

<p>The network has expanded to more than 1,500 locations nationwide, with Parcel Lockers positioned at Post Offices, shopping centres, supermarkets, transport hubs and, increasingly, within or alongside residential developments.</p>

<p>That growing presence reflects a broader change in how apartment buildings are being planned.</p>

<p>Developers are increasingly considering the operational side of apartment living alongside traditional lifestyle amenities. Just as secure mailrooms, bicycle storage and EV charging have become more common inclusions, parcel management is emerging as another feature that supports everyday convenience.</p>

<p>It also helps preserve the arrival experience within a building. Carefully designed lobbies and communal spaces can quickly become cluttered when deliveries accumulate, while secure parcel solutions reduce the likelihood of missed deliveries or parcels being left unattended.</p>

<p>For buyers comparing apartments, these everyday details are becoming part of the decision-making process.</p>

<p>Location, floorplans and finishes remain fundamental, but the features that simplify daily life are carrying greater weight than they once did. As online shopping continues to shape consumer behaviour, secure parcel delivery is increasingly becoming another amenity worth looking for.</p>


Parcel delivery is joining the apartment amenity checklist

<p data-end="471" data-start="164">Inca Property Group has lodged a State Significant Development Application (SSDA) for Dawn, a 53-apartment oceanfront development overlooking Mona Vale Beach.</p>

<p data-end="777" data-start="473">The proposal, at 35-39 Darley Street East, would replace an existing 18-apartment strata building with a new owner-occupier-focused development comprising 53 two and three-bedroom apartments, including nine affordable built-to-rent residences delivered under the State's infill affordable housing scheme.</p>

<p data-end="976" data-start="779">Positioned on a 2,679 sqm elevated site around 280 metres from Mona Vale Beach, the development has been designed to maximise panoramic ocean views while responding to the site's sloping topography.</p>

<p data-end="1119" data-start="978"><a href="https://www.apartments.com.au/developers/inca-property-group">Inca Property Group</a> Managing Director Josh Thompson said the State Significant pathway provided greater certainty for projects of this scale.</p>

<p data-end="1399" data-start="1121">"This State Significant pathway gives the team real certainty to progress <a href="https://www.apartments.com.au/new-apartments/dawn-35-39-darley-street-east-mona-vale-nsw-2103">Dawn</a> through to completion," Thompson said.</p>

<p data-end="1399" data-start="1121">"It allows us to acquire a one-off site, design it carefully and deliver the right offering for the suburb, assessed by the NSW Government's planning department."</p>

<p data-end="1605" data-start="1401">The project is one of the first developments in the area to be assessed under the NSW Government's Low and Mid-Rise Housing policy, with the site sitting on the edge of the policy's designated inner area.</p>

<p data-end="1852" data-start="1607">The proposal includes three basement levels providing 124 car spaces, alongside a range of resident amenities including a swimming pool, gym, sauna, wellness facilities and private plunge pools for selected ground-floor and penthouse apartments.</p>

<p data-end="1852" data-start="1607"><img alt="Dawn" data-entity-type="file" data-entity-uuid="fc1a1daf-0ce4-4f12-9076-b1fa553c7a91" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-21%20at%208.42.11%E2%80%AFAM.png?VersionId=4GZ9h.gpNkTljbxyAET8Jfhv51XUamDm" /></p>

<p data-end="2031" data-start="1854">Thompson said Dawn had been designed specifically for owner-occupiers and downsizers, a buyer profile that has driven demand across Inca's recent Upper North Shore developments.</p>

<p data-end="2299" data-start="2033">"The majority of buyers in our recent North Shore projects have been downsizers, and we are learning exactly what this market is looking for. Beyond the location itself, we have included resort-style amenities to deliver a genuine lifestyle offering," Thompson said.</p>

<p data-end="2588" data-start="2301">Located within walking distance of Mona Vale Beach, the town centre, Mona Vale Golf Club and the Royal Motor Yacht Club, Dawn represents Inca's first Northern Beaches project following the sell-out of Tara on Park in Waitara and Ellis Residences, currently under construction in St Ives.</p>

<p data-end="4143" data-start="3991">Construction will be undertaken by Inca's in-house construction arm, GOP Constructions.</p>

<p data-end="593" data-start="417">Dawn is the latest major apartment proposal for Mona Vale, with the suburb emerging as one of the key beneficiaries of the NSW Government's new Low and Mid-Rise Housing policy.</p>

<p data-end="789" data-start="598">New developer One Living, led by industry veteran Joseph Scuderi, recently secured a site on Mona Vale Road, on the border of Mona Vale and Pymble, where it is planning around 140 apartments.</p>

<p data-end="1053" data-start="794">IPM is also planning its third project in Mona Vale, significantly increasing the scale of its previous developments with an 82-apartment proposal at <a href="https://www.apartments.com.au/new-apartments/159-167-darley-street-west-mona-vale-nsw-2103">159-167 Darley Street West</a>, opposite Bayview Golf Course and less than 800 metres from Mona Vale town centre.</p>

<p data-end="4143" data-start="3991"><em>Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/one-living-enters-sydneys-new-apartment-market-with-northern-beaches-site-acquisition">One Living enters Sydney's new apartment market with Northern Beaches site acquisition</a></em></p>

<p data-end="4143" data-start="3991"><em>Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/first-look-ipm-plans-third-mona-vale-project">First look: IPM plans third Mona Vale project</a></em></p>


First look: Inca eyes Mona Vale with State Significant DA for Dawn apartments

Immigration

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<p>While Australia celebrates 25 years of economic growth, or an expansion in GDP, one economist says the story is different for the average household as an increase in population takes a toll on living standards.</p>
<p>Commonwealth Bank senior economist Gareth Aird says in a report produced by the bank’s economics team that the focus on the headline GDP number is misleading, and a better measure would be the per capita growth.</p>
<p>Aird said while the focus on immigration has boosted consumption because “more people means more spending”, and hence GDP growth, population growth creates problems like overcrowding, traffic congestion and high housing costs.</p>
<p>The latest gross domestic product (GDP) figures for the June quarter, released in September, showed the economy growing at an annual pace of 3.3 percent.</p>
<p>"Despite the fact that the economy's growing at what looks like a healthy clip on the surface, the way that transfers to how households feel at the moment suggests that things aren't too crash," Aird was quoted by ABC.</p>
<p>Aird said the headline GDP figure ignores population growth, which automatically grows the economy but not the standard of living.</p>
<p>“If you've got more people, you've got more spending," he said in an interview for RN Breakfast.</p>
<p>“But what really matters for households is not the overall growth rate of the economy but how their incomes are growing."</p>
<p>He said a better measure for this purpose is real net national disposable income (RNNDI) per capita, which more closely reflects the income going to households and their capacity to buy goods and services.</p>
<p>Unlike GDP, which has been boosted by the rising volume of mining exports even though prices for those exports have slumped, RNNDI has been hit hard, and has been going backwards for most of the past five years when looked at per person.</p>
<p>He said governments focus more on GDP growth because it “benefits businesses that can take advantage of an ever growing population, or customer base if you like”. </p>
<p>One of the economic arguments that has been used to support current immigration rates has been that it helps offset an ageing population.</p>
<p>However, the CBA report said this is only "kicking the can down the road", with the current working age migrants themselves ageing and leaving the workforce 20, 30 or 40 years from now.</p>
<p>Although Aird did point out the benefits to the Australian economy from immigration.</p>
<p>"If you look at the historical experience of Australia, there has absolutely been benefits to having pretty strong population growth," he said.</p>
<p>"But I think more recently we've seen some of the indicators suggest that those benefits are probably starting to wane and unless there's a commensurate lift in public investment, a look at housing affordability more broadly ... then I think the benefits to running a strong immigration program are questionable."</p>
<p>He said to make migration work, governments should also focus on building infrastructure such as more affordable transport and housing.</p>
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prateek24-ezbwHMbNAk

Population growth fuels GDP rise, but lowers living standards: CBA economist

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<p>Two in five Hongkongers would emigrate if they got the chance with Australia the second most preferred destination, a survey has found.</p>
<p>The Hong Kong Institute of Asia- Pacific Studies of the Chinese University of Hong Kong conducted a telephone survey of 710 people aged 18 or above to gauge public views on emigration.</p>
<p>It found 39 percent indicated they wanted to emigrate with 11 percent of this group were taking action to make preparations.</p>
<p>The most preferred destinations, ranked by popularity, were Taiwan, Australia and Canada, according to the survey.</p>
<p>Dissatisfaction with governance was the major factor as to why people wanted to leave with 11 percent reflecting they were unhappy with the government, chief executive or high-ranking officials when asked about their intention to emigrate.</p>
<p>Overcrowded living conditions came second with 10 percent, followed by too much political dispute or social cleavage and slow economic growth or bad economic prospects.</p>
<p>The survey also found that 57 percent of those who had a tendency to leave the SAR were youths, aged 18 to 30 - then 26 percent being aged 51 or older. </p>
<p>Eddie Kwan King-hung, founder of EK Immigration Consulting, said he has observed more emigration inquiries in the past two to three years, especially after the Occupy protests in 2014.</p>
<p>However, he said not many people could meet the requirements set by the popular destinations noting Australia currently takes immigrants with a Significant Investor Visa with a requirement of at least A$5 million (HK$29 million).</p>
<p>Kwan said Taiwan has become Hongkongers' new favorite place as there is almost no language barrier, and the island only requires an investment of NT$6 million (HK$1.5 million), sufficient for operating businesses such as a bed and breakfast or restaurants.</p>
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jchancellor-FAypfDUnLy

Australia second most preferred destination of Hongkongers

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<div>In Britain the topical political and media talk is of whether an "Australian-style" points based immigration system should be introduced, without any real clarity about what that would mean in practice.</div>
<div> </div>
<div>Back Down Under it's often said that Australia's population growth must slow if the economy isn't creating enough jobs. This is essentially true for 457 visas, but does overlook the potential underlying demand for other visa classes.</div>
<div> </div>
<div>I previously looked at the newly relaxed international student visa rules which were made effective from 1 July, easing the rules for parents and guardians of primary school age students in Australia.<br><br>The recent election campaign also led to some potentially interesting shifts via proposed policies for...</div>
<div> </div>
<div><strong><span style="text-decoration: underline;"><span>Parent visa rules</span></span></strong></div>
<p><span>In 2016, the percentage of Australians born overseas hit its highest level in 120 years at a massive 28 per cent. </span></p>
<div>
<span>Immigration policies understandably prefer immigrants to be of the young, working (or creating jobs through business), and tax-paying demographic.</span><br><span><br></span><span>Thus over the</span><span> 2015/16 Migration Programme year, parent visa places were capped as follows:</span>
</div>
<ul>
<li><span><strong>1,500 places allocated to Parent (non-contributory) visas </strong></span></li>
<li>
<span><strong>7,175 places allocated to Contributory Parent visas</strong></span> </li>
</ul>
<div><span>This means that your best chance of getting a parent visa in the last financial year was likely <a href="https://www.border.gov.au/Trav/Visa/Fees" target="_blank">to pay</a> the prohibitive A$47,000 for a contributory visa - about A$100,000 for a couple! - while successful sponsorship for standard parent visas was extremely hard to come by. </span></div>
<div><span> </span></div>
<div><span>The unattractive alternative for parents wanting to join their families in Australia was to come in on a one year visitor visa, then leave the country for six months on each occasion. It would be a sore test of anyone's resolve to repeat this process over any meaningful period of time! </span></div>
<div><span> </span></div>
<div>
<span>With some 6.8 million Australians having been born overseas the potential demand for parent visas is massive and growing, particularly from China and India. </span><br><br><span>I wouldn't believe anything a politician told me these days, but Google trends activity shows that </span><span>there has been an explosion of interest in parent visas since the last full Census in 2011.</span>
</div>
<div> </div>
<div>
<a href="/images/2016/09/06/PArents.jpg" target="_blank">Click to enlarge</a><br><br><div class="separator">
<img src="/images/2016/09/06/PArents.jpg" alt=""> </div>
<div class="separator"> </div>
</div>
<div>
<span>It's worth noting that previous rules weren't favourable to Chinese families, due to China's one child policy meaning that most parents naturally had only one child in Australia, which was an obvious mathematical hindrance in proving that the balance of your family lived here. </span><br><span><br></span><span>As at 30 June 2016 due to the caps there were 38,770 persons in the queue for standard parent visas (up 59 percent from last year), and another 5,160 persons for aged parent visas (up 28 percent). </span>
</div>
<div><span> </span></div>
<div><a href="/images/2016/09/06/Parent.jpg" target="_blank"><span>Click to enlarge</span></a></div>
<div><span><img src="/images/2016/09/06/Parent.jpg" alt=""></span></div>
<p> </p>
<div>With standard parent visas presently capped at 1,500 per year, a queue of this size at 30 June equated to a ridiculous 25.8 year average wait time for an application to be processed. </div>
<div> </div>
<div><strong><span style="text-decoration: underline;">Election pledges</span></strong></div>
<div> </div>
<div>During a keenly contested election campaign the Australian Labor Party (ALP) announced plans to extend visitor visas to parents out to a far more palatable three years - with parents only being required to leave the country for four weeks at the end of each visa term and paying a $5,000 bond to ensure cover for medical and social services.<br><br>Surely a potential vote-winner for the ALP in the rapidly growing migrant communities, particularly in an era where so many young families also strive to be dual-income households. </div>
<div> </div>
<div>As tends to be the way of these things, the Coalition's knee-jerk response was to announce a new parent visa plan itself, especially aimed at Chinese and Indian visitors (provided that new arrivals pay for health insurance and don't rely on the welfare state for health care, shamelessly piggybacking from the ALP proposals!) and allowing for continuous <strong>five year</strong> visitor visas. </div>
<div> </div>
<div>Given that the number of overseas born Aussies is soon to pass 7 million, such a policy could potentially lead to hundreds of thousands of applicants for visitor visas from parents sponsored by Australian citizens, largely from ageing, non-English speakers hailing from Asia (which is not really the ideal target demographic for policy makers).<br><br>For this reason the Coalition's proposed policy denotes that parents of Australian citizens and permanent residents who have lodged a permanent parental visa application "may" be issued a five year visa "on a case-by-case basis". </div>
<div> </div>
<div>In other words, this is an 'out'. Minister Dutton has the discretion to limit the number of visas issued and retains the right for policy to change course henceforth. </div>
<div> </div>
<div><strong><span style="text-decoration: underline;">The wrap</span></strong></div>
<div> </div>
<div>At this juncture there appears to be very little clarity surrounding what will happen with respect to parent visas.</div>
<div> </div>
<div>The Coalition probably doesn't know the answer itself, election pledges doubtless being dreamed up on the hoof in response to the ALP's evidently popular proposal. </div>
<div> </div>
<div>A point here relevant to the property markets is that if Australia does end up with an oversupply of thousands of apartments as many have forecast, there are levers that can be pulled to loosen immigration policies.</div>
<div> </div>
<div>After all, a sceptic would say that if there's a policy that's always guaranteed to garner support from governing parties of either persuasion, it's one aimed at propping up ailing capital city housing markets. </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>
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pwargent-M4siyDbqQY

Immigration levers and the apartment oversupply scenario: Pete Wargent

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<div id="post-body-1153754225725279273" class="post-body entry-content">
<div>According to the Department of Immigration and Border Protection (DIBP) the significant investor visa (SIV) programme is designed to be:</div>
<div> </div>
<div><em>"...a pathway to provide for significant migrant investment into Australia under the Business Innovation and Investment visa programme".</em></div>
<div> </div>
<div>From the inception of the SIV programme in November 2012 until 30 June 2015 there had been some 2,573 applications lodged, but only 879 visas actually granted.</div>
<br><a href="/images/2016/08/30/SIV2.jpg" target="_blank">Click to enlarge</a>
</div>
<div class="post-body entry-content">
<img src="/images/2016/08/30/SIV2.jpg" alt=""><br><span><br></span><span>There can necessarily be a lag between application lodgement and visas being granted.</span><br><span><br></span><span>The service standard is 6 to 9 months for the Business Innovation and Investment category.</span><br><div> </div>
<div>The latest available statistics from the DIBP showed that 495 of the outstanding applications lodged prior to 1 July 2015 have now been granted.</div>
<div> </div>
<div>A further 20 applications lodged after 1 July 2015 have also been granted in the financial year to 31 May 2016.</div>
<div> </div>
<div>This means that the May 2016 figures recorded a total of 515 SIVs issued for the 11 months for the financial year to date.</div>
<br><div class="separator"><a href="/images/2016/08/30/SIV1.jpg" target="_blank">Click to enlarge</a></div>
<div class="separator"><img src="/images/2016/08/30/SIV1.jpg" alt=""></div>
<div> </div>
<div class="separator">The geographically segmented figures show that high net worth applicants are overwhelmingly focused on Melbourne, and then Sydney...with daylight third. </div>
<div class="separator"> </div>
<div class="separator">This reflects that Melbourne and to a somewhat lesser extent Sydney have been the two key destinations and markets of interest for Chinese investors since around 2012.</div>
<div class="separator"> </div>
<div class="separator">Indeed, the Foreign Investment Review Board (FIRB) Annual Report showed that real estate applications tripled in two years, driven overwhelmingly by a deluge of Chinese investors into Victoria, New South Wales, and Queensland. </div>
<div class="separator"> </div>
<div class="separator">The DIBP statistics for the top five source countries correspondingly show that more than 90 per cent of applicants for SIVs have also been Chinese. </div>
<br><div class="separator"><a href="/images/2016/08/30/SIV3.jpg" target="_blank"> Click to enlarge</a></div>
<div class="separator"><img src="/images/2016/08/30/SIV3.jpg" alt=""></div>
<br><strong><span style="text-decoration: underline;">The wrap</span></strong><br><br><div>Since the commencement of the significant investor visa programme in 2012 there have now been a total of 1,397 SIVs granted, leading to just a shade under A$7 billion of investment in complying assets.</div>
<div> </div>
<div>It's difficult to say what the expected take-up for the SIV ever really was, but fewer than 1,400 visas sounds suspiciously like a fizzer of an initiative to me (albeit the composition and destination of applicants says something of note about where capital invested in Australia is coming from and where it is headed to).</div>
<div> </div>
<div>Previously SIV investors were opting to drop money into passive investments such as qualifying government bonds and residential real estate schemes - not really what Australia needs more of, tbh! - which led to a much-needed reassessment of the requirements for complying investments.</div>
<div> </div>
<div>Unfortunately interest in SIVs has been dampened since, following consultation with stakeholders, the rules were amended to require a greater share of the $5 million required investment to hit up venture capital products (at least 10 per cent) and emerging companies (minimum 30 per cent), investments that are typically associated with a higher risk of loss, whether perceived or real.</div>
<div> </div>
<div class="separator"><a href="/images/2016/08/30/DIBP.jpg" target="_blank">Click to enlarge</a></div>
<div class="separator"><img src="/images/2016/08/30/DIBP.jpg" alt=""></div>
<div> </div>
<div><span style="text-decoration: underline;"><em>Source: DIBP</em></span></div>
<div> </div>
<div>The most timely available statistics for expressions of interest, invitations, and applications lodged suggest only a modest ongoing flow of interest in the SIV.</div>
<div> </div>
<div>Requiring wealthy Chinese with A$5 million to invest in venture capital projects and emerging companies is a fabulous idea...on paper.<br><br>In reality, however, this may be too ambitious and result in the killing off of SIV applications given that wealthy foreigners are unlikely to be familiar with the products and ventures in question, and therefore remain understandably reluctant to commit.</div>
<div> </div>
<div>It wouldn't be a surprise to see the rules amended again or relaxed to allow Chinese investors to provide project funding (not passive investment) for residential and commercial real estate developments, or for infrastructure projects.</div>
<div> </div>
</div>
<div class="post-footer"> 
<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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Slow take up of Significant Investor Visa: Pete Wargent 

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<div>There was a slight increase in the number of permanent settlers in Australia in the year to June, according to today's ABS figures. </div>
<div> </div>
<div>Most come from Asia, at 58.4 per cent in the year to June.</div>
<div> </div>
<div>Only 410 Brit settlers arrived in the month of June - crashing down from a record 2,560 in August 2007 to the lowest figure in the history of the data series. </div>
<div> </div>
<div>Not so many Kiwis are making the permanent journey across the Tasman either right now.</div>
<div> </div>
<div><a href="/images/2016/08/05/A5.jpg" target="_blank">Click to enlarge</a></div>
<div> </div>
<div><img src="/images/2016/08/05/A5.jpg" alt=""></div>
<div> </div>
<div>With departures up over the past year, net permanent and long term immigration fell quite sharply to +262,800, the lowest figure since March 2007.</div>
<p><a href="/images/2016/08/05/A1.jpg" target="_blank">Click to enlarge</a></p>
<div class="separator"><img src="/images/2016/08/05/A1.jpg" alt=""></div>
<p> </p>
<div>It's another type of casualisation. </div>
<div> </div>
<div>Just as there are more part time jobs these days than there used to be, there are more part time migrants!<br><br>Despite the slowdown, as I explored here the headcount in Australia is probably up by more than 400,000 over the last year, including a surge in international students.</div>
<p><br><strong><span style="text-decoration: underline;">Record visitors</span></strong></p>
<div> </div>
<div>The lower dollar has resulted in an epic boom in short term arrivals, to yet another all-time high of 7.84 million.<br><br>And this figure is accelerating, up by 10 per cent over the past year. </div>
<div> </div>
<div>That said, the downward pressure impact of the lower dollar on short term departures (up to 9.67 million) may be beginning to fade. </div>
<p><a href="/images/2016/08/05/A3.jpg" target="_blank"> Click to enlarge</a></p>
<div class="separator"><img src="/images/2016/08/05/A3.jpg" alt=""></div>
<div class="separator"> </div>
<div>Most short term visitors come for holidays (3.91 million) or to visit friends and relatives (2.04 million).</div>
<p><a href="/images/2016/08/05/A6.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/08/05/A6.jpg" alt=""></p>
<div> </div>
<div>No surprises that June saw yet another monthly record in the number of visitors from China and Hong Kong,</div>
<div> </div>
<div>There has been a stunning 21 per cent increase in annual visitors from China, Hong Kong, and Taiwan, to a record 1.54 million (a rip-snorting 13-fold increase from 1991). </div>
<p><a href="/images/2016/08/05/A4.jpg" target="_blank"> Click to enlarge</a></p>
<div class="separator"><img src="/images/2016/08/05/A4.jpg" alt=""></div>
<p><br><span>Meanwhile 469,800 education arrivals in the year to June was 14 per cent higher than one year ago.</span><br><br><a href="/images/2016/08/05/A2.jpg" target="_blank">Click to enlarge</a><br><img src="/images/2016/08/05/A2.jpg" alt=""></p>
<div>Recall that the visa rules for international students were relaxed effective 1 July, so these figures will likely accelerate in the second half of 2016.</div>
<p><strong><span style="text-decoration: underline;">The wrap</span></strong></p>
<div>As you were, really.</div>
<div> </div>
<div>Fewer long term and permanent migrants to Australia - particularly from the United Kingdom and New Zealand - but record short term arrivals and ever more Chinese visitors (with more to come when the changes to student visa rules kick in as the year progresses). </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>
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Record Chinese visitors again: Pete Wargent

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<p><span style="line-height: 1.3em;">In case it wasn't already obvious from reading this blog, I absolutely love analysing data flows, and I particularly love it when the numbers "just work"!</span></p>
<p>Immigration and population growth is a great case in point.</p>
<p>There was a huge surge in immigration and population growth to more than 450,000 per annum through the mining boom, which naturally slowed as the peak was passed and unemployment began to rise.</p>
<p>I've been hinting on this blog for a while that population growth probably bottomed out in 2015 and by now is probably rising again, though I haven't had any hard data to back that up just yet.</p>
<p>This is partly because a better performing Australian economy is now attracting more migrants - annual employment growth of about +2.3 per cent has been far outpacing population growth of about +1.3 per cent, helping the unemployment rate to cascade into a 28 month downtrend.</p>
<p>And secondly because, largely unrecognised by commentary, a relaxation of visa rules will see tens of thousands of international students acquire permanent residency through the "back door" of higher education.</p>
<div><strong><span style="text-decoration: underline;">Immigration rises again</span></strong></div>
<div> </div>
<div>There was a significant +14 per cent year-on-year jump in the number of permanent and long term arrivals in February to 91,590, while the number of permanent and long term departues wasn't much changed at +31,700, for a net monthly inflow of just under 60,000.</div>
<div> </div>
<div>I wouldn't read too much into one month of figures, granted, but mapping the data on a rolling annual basis showed a rise in net immigration for the first time in two years. </div>
<div id="post-body-6916561749567946338" class="post-body entry-content">
<br><a href="/images/2016/04/8/A3.jpg" target="_blank">Click to enlarge</a>
</div>
<div class="post-body entry-content">
<img src="/images/2016/04/8/A3.jpg" alt=""><br><br><div>The share of settlers from Asia over the year to February continued to increase to its highest ever level at +58.1 per cent, largely at the expense of arrivals from the United Kingdom and New Zealand. </div>
<br><a href="/images/2016/04/8/A4.jpg" target="_blank">Click to enlarge</a>
</div>
<div class="post-body entry-content">
<img src="/images/2016/04/8/A4.jpg" alt=""><br><div> </div>
<div><strong><span style="text-decoration: underline;">Record short term arrivals help rebalancing</span></strong></div>
<div> </div>
<div>The lower dollar is very slowly but surely helping the rebalancing of the economy, with a record 7.55 million short term arrivals in the year to February.</div>
<div> </div>
<div>Australia is a wealthy nation when measured in per capita terms, yet provided the dollar stays low enough for long enough evenutally there could even come a time when short term arrivals match the number of our own overseas trips, as more Aussies opt to holiday at home, thereby boosting the economy. In the words of British Rail, "we're getting there".</div>
<br><a href="/images/2016/04/8/A5.jpg" target="_blank">Click to enlarge</a>
</div>
<div class="post-body entry-content"> </div>
<div class="post-body entry-content">
<img src="/images/2016/04/8/A5.jpg" alt=""><br><div> </div>
<div>The annual number of short term arrivals from China, Hong Kong &amp; Taiwan (1.44 million) is poised to eclipse those from New Zealand &amp; Oceania imminently (1.49 million). </div>
<br><div class="separator"><a href="/images/2016/04/8/A1.jpg" target="_blank">Click to enlarge</a></div>
<div class="separator"><img src="/images/2016/04/8/A1.jpg" alt=""></div>
<br><strong><span style="text-decoration: underline;">Education arrivals going vert!</span></strong><br><br><div>With the share of overseas born Aussies now at a 120 year high, more than 2 million persons per annum are venturing Down Under to visit friends and relatives, which in turn reinforces the strength in the number of visitors from Asia. </div>
<br><a href="/images/2016/04/8/A6.jpg" target="_blank">Click to enlarge</a>
</div>
<div class="post-body entry-content">
<img src="/images/2016/04/8/A6.jpg" alt=""><br><div> </div>
<div>The most significant demographic shift of all has been the near-exponential surge in education arrivals, which bolted to another new record high of 95,100 in February, taking the annual total past half a million for the first time on record. </div>
<div> </div>
<div class="separator"><a href="/images/2016/04/8/A2.jpg" target="_blank">Click to enlarge</a></div>
<div class="separator"><img src="/images/2016/04/8/A2.jpg" alt=""></div>
<br><div class="separator">This is extremely significant, as in the years ahead tens of thousands of these international students will become permanent residents, largely in the largest capital cities.</div>
<div class="separator"> </div>
<div class="separator"><strong><span style="text-decoration: underline;">The wrap</span></strong></div>
<div> </div>
<div>Well, it has certainly been a while coming, but February saw the first rebound in immigration in a couple of years.</div>
<div> </div>
<div>In truth, population growth never really slowed that much in the largest capital cities anyway - still chugging along at a thunderous 80,000 to 90,000 per annum - the slowdown was more of a resources and a regional thing. </div>
<div> </div>
<div>In any case from observing the ABS data and from mapping out official government forecasts it looks as though population growth probably bottomed out at around 310,000 per annum, and is set to increase to about 340,000 in 2016, and to beyond 400,000 per annum before the end of the decade.</div>
<div> </div>
<div>Perhaps just as relevantly, it is important to note that the population growth is becoming increasingly centralised and focussed on a handful of capital cities, a trend which will only accelerate thanks to Asian and international student migration. </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>
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Population growth to rebound in 2016: Pete Wargent

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<p>GUEST OBSERVER</p>
<p>Tourists from greater China (China and Hong Kong) totalled 108,400 in February <span style="line-height: 1.3em;">(mainland China 89,100, Hong Kong, 19,300), ahead of New Zealand (102,600).</span></p>
<p>Tourist arrivals from mainland China and Hong Kong rose to a record 1,326,076 over the past year (up 23.5 <span style="line-height: 1.3em;">percent over the year) and just shy of tourists from New Zealand (1,326,851 visitors over the past year).</span></p>
<p>Migration: Over the past year, net permanent and long-term arrivals to Australia totalled 259,710 – the <span style="line-height: 1.3em;">lowest level in nine years (February 2007).</span></p>
<p>Tourist arrivals fell by 2.7 percent in February. And departures fell from fresh record highs down by 3.3 <span style="line-height: 1.3em;">percent. T</span><span style="line-height: 1.3em;">he tourism data is important for airlines, travel groups, transport companies and retailers.</span></p>
<p><a href="/images/2016/04/7/Screen%20Shot%202016-04-07%20at%202.38.48%20PM.png" target="_blank"><span style="line-height: 1.3em;">Click to enlarge</span></a></p>
<p><span style="line-height: 1.3em;"><img src="/images/2016/04/7/Screen%20Shot%202016-04-07%20at%202.38.48%20PM.png" alt=""></span></p>
<p>What does it all mean?</p>
<p>The China tourist boom continues to pay dividends. The number of tourists to Australia from China and Hong <span style="line-height: 1.3em;">Kong combined exceeded well over 1.3 million in the past year – and is closing fast on the visitors from New </span><span style="line-height: 1.3em;">Zealand. In fact the difference is only 775 tourists. And with China and Hong Kong tourist numbers continuing to </span><span style="line-height: 1.3em;">grow at a 23 percent plus annual rate, there are more landmark results likely to be recorded over the next few </span><span style="line-height: 1.3em;">months. It is even more remarkable when you consider that just over four years ago Chinese tourist numbers </span><span style="line-height: 1.3em;">were around half those of New Zealand.</span></p>
<p>Clearly our number one tourist group is up for grabs with China and Hong Kong likely to take the top spot within a <span style="line-height: 1.3em;">month. The new winners from the China boom are tourist operators and retailers rather than mining companies </span><span style="line-height: 1.3em;">that benefitted in the first stage of the China boom.</span></p>
<p>Tourists from mainland China is fast closing in on 1.1 million in the past year, up 24 percent over the past year.</p>
<p>While some may fret about the slowdown in the Chinese industrial sector, the more forward-thinking analysts are <span style="line-height: 1.3em;">focussing on the boost to Australian retailers from increased spending by Chinese consumers and the growing </span><span style="line-height: 1.3em;">number of Chinese tourists.</span></p>
<p>The rebalancing continues to be taking place across the economy. No doubt the weaker Aussie dollar is helping <span style="line-height: 1.3em;">to alleviate some of the pressures for the weaker investment story. And from the Reserve Bank’s standpoint there </span><span style="line-height: 1.3em;">is nothing to do but to monitor the transitions to ensure that the process moves as smoothly as possible.</span></p>
<p>What do the figures show?</p>
<p>Overseas arrivals &amp; departures</p>
<p>Tourist arrivals  fell by 2.7 pe cent in February. And departures  fell from fresh record highs down by 3.3 per<span style="line-height: 1.3em;">cent. Arrivals are up 5.9 percent on the year with departures up 1.7 per cent.</span></p>
<p>In February, tourists from greater China (China and Hong Kong) totalled 108,400 (mainland China 89,100, Hong <span style="line-height: 1.3em;">Kong, 19,300), ahead of New Zealand (102,600). Greater China passed NZ for the first time in September.</span></p>
<p>Over the past year a record 1,076,800 tourists came to Australia from China, up 23.6 percent over the year. <span style="line-height: 1.3em;">Tourists from China and Hong Kong rose to a record 1,326,076 over the past year, up 23.5 percent over the </span><span style="line-height: 1.3em;">year. Tourists from New Zealand totalled 1,326,851 visitors over the past year, but were up just 6.6 percent.</span></p>
<p>Over the past year, net permanent and long-term arrivals  to Australia totalled 259,710 – the lowest level in nine <span style="line-height: 1.3em;">years (February 2007).</span></p>
<p>What is the importance of the economic data?</p>
<p>The Australian Bureau of Statistics releases data on overseas arrivals and departures  is produced monthly and <span style="line-height: 1.3em;">is an indicator of the health of the tourism sector. The figures are also useful in understanding spending trends </span><span style="line-height: 1.3em;">and tracking migrant numbers – an indicator with widespread implications for employment, housing and spending.</span></p>
<p>What are the implications for interest rates and investors?</p>
<p>Looking forward, not only will the fall in the Aussie dollar drive further tourism inflows, but it should provide an <span style="line-height: 1.3em;">additional degree of support to the domestic tourism sector. Over time, the cheaper currency should make it more </span><span style="line-height: 1.3em;">attractive to travel within Australia rather than overseas. Tourism has potential to join housing as a key driver of </span><span style="line-height: 1.3em;">the Australian economy over the coming year, especially if the Aussie dollar falls further.</span></p>
<p>In-bound migration is holding just shy of the lowest levels in nine years, meaning that there is greater scope for <span style="line-height: 1.3em;">unemployment to fall in the short-term before businesses have to start looking abroad for suitable staff.</span></p>
<p>The Reserve Bank will remain on the interest rate sidelines over the next few months.</p>
<p><a href="/images/2016/04/7/Screen%20Shot%202016-04-07%20at%202.47.23%20PM.png" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/04/7/Screen%20Shot%202016-04-07%20at%202.47.23%20PM.png" alt="" width="1129" height="366"></p>
<p><em>Savanth Sebastian is an economist for <a href="https://www.commsec.com.au/" target="_blank">CommSec</a></em> </p>
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