Joel Robinson

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

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.

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.

<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.

The development will be delivered across two stages, with the first stage carrying an estimated gross realisation value of around $360 million.

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.

The residential mix will include townhomes, oversized two-bedroom apartments, substantial three-bedroom residences and four-bedroom homes.

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.

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.

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.

<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" />

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.

"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.

"With Gold Coast Airport on its doorstep, it also offers a level of accessibility that broadens its appeal across almost every market demographic."

The project comes as the southern Gold Coast continues to attract an increasing share of high-end apartment development and buyer activity.

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.

Mould said those characteristics had informed the approach MAYD and Cera Stribley had taken to the project.

"We've worked closely with Cera Stribley to create a vision that is deeply connected to its surroundings," he said.

"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."

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.

"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.

"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."

Cottam said the proximity to Gold Coast Airport was also proving increasingly important for interstate and second-home buyers.

"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."

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.

MAYD is targeting an early 2027 launch.

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

<main data-perf-region="main">
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.

But despite that growth, the suburb has seen relatively few major new apartment projects brought to market over the past 18 months.

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.

[smartcode_project:default project_id=152737 project_image_fid=377679]

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.

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.

[smartcode_project:default project_id=152737 project_image_fid=377675]

Nova Rêve also represents a significant step up from the family's first apartment development, Grand Rêve, which was delivered nearby on Garthowen Crescent.

Grand Rêve introduced larger, house-like apartment layouts and premium inclusions including Wolf and Sub-Zero appliances to the Castle Hill market.

Nova Rêve takes that approach to a precinct scale, combining the residential component with hospitality, retail and substantial public and resident landscaping.

[smartcode_project:default project_id=152737 project_image_fid=377685]

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.

"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.

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.

It will include restaurants, cafes, skybars and all-day dining, alongside conference and event facilities catering to business functions, community groups and private events.

At ground level, more than 1,600 sqm of shops and cafes will open onto the surrounding streets and landscaped areas.

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.

[smartcode_project:default project_id=152737 project_image_fid=377680]

Reve Group's Romio Georges said creating an active ground plane had been central to the planning of Nova Rêve.

"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.

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.

More than 80 per cent of the apartments will occupy corner positions, with Turner responsible for both the architecture and interiors.

&nbsp;

[smartcode_project_cta:default project_id=152737]

<h3 data-end="3697" data-section-id="q3n5ak" data-start="3672">&nbsp;</h3>
</main>

Nova Rêve arrives as Reve Group bets on Castle Hill's next growth phase

A collection of just 25 large-format apartments and penthouses overlooking Goodwin Park is entering the Coolangatta market, with <a href="https://www.apartments.com.au/new-apartments/marea-residences-coolangatta-27-27a-dixon-street-coolangatta-qld-4225">Maréa Residences</a> combining a low-density, residential-only approach with uninterrupted park and Pacific Ocean outlooks.

Located at 27 Dixon Street, Maréa comprises three and four-bedroom residences alongside a limited number of dual-level penthouses, with the project positioned between Goodwin Park and <a href="https://www.apartments.com.au/developments/coolangatta-qld-4225">Coolangatta</a>’s coastal precinct.

Construction has commenced, with completion currently estimated for late 2027. Three-bedroom residences are priced from $1.8 million.

[smartcode_project:default project_id=150999 project_image_fid=374005]

The project has been designed around its northern outlook across the park, with the building’s architecture, landscaping and material palette intended to establish a connection with the neighbouring green space. The residences have been configured to maximise natural light and views across Goodwin Park towards the ocean.

Inside, the material palette incorporates timber, stone and brushed brass, complemented by curved detailing and ambient lighting. Kitchens and bathrooms carry the same natural material approach, while residences also include basement parking, storage and lift access.

Maréa’s penthouses are arranged over two levels and include private pools, adding another layer to the project’s focus on larger-format apartment living. Across the development, residences are configured with three or four bedrooms rather than the broader mix of smaller apartment types commonly found in larger projects.

[smartcode_project:default project_id=150999 project_image_fid=374010]

Resident amenity is concentrated at rooftop level, where landscaped entertaining terraces and pools take advantage of elevated views across Coolangatta and the Pacific Ocean.

The project has so far been particularly well received by local owner-occupiers and downsizers, according to Urban Activation Property Sales and Marketing Director Matt George, with the residential-only format, construction quality and northern park outlook among the features resonating with purchasers.

“The uninterrupted northern aspect overlooking Goodwin Park has been a key point of difference, with buyers attracted to the sense of serenity and open space the park provides, while still enjoying easy access to the ocean and being within walking distance of the lifestyle and amenities Coolangatta has to offer,” George said.

[smartcode_project:default project_id=150999 project_image_fid=374002]

“The combination of high-quality construction, a residential-only building, park outlook and proximity to the beach has resonated strongly with the local downsizer market.”

The Dixon Street address is within walking distance of Coolangatta Beach and the broader southern Gold Coast coastline, including the surf breaks at Snapper Rocks and Kirra. Coolangatta’s cafés, restaurants and retail are nearby, while Gold Coast Airport is also within close proximity.

[smartcode_project_cta:default project_id=150999]

Maréa Residences brings parkside apartments to Coolangatta

Melbourne developer PDG has secured Victorian Government approval for its $1.5 billion Southbank development <a href="https://www.apartments.com.au/new-apartments/the-one-1-queens-bridge-street-southbank-vic-3006">The One</a>, clearing the way for the long-dormant riverfront site opposite Crown to finally be developed.

The Minister for Planning has approved the project at 1-29 Queens Bridge Street, with the Department of Transport and Planning issuing the planning permit following its assessment.

The approval will allow PDG to develop the prominent 5,059 sqm site with a major mixed-use tower comprising premium apartments, including branded residences, a luxury hotel and boutique office space.

PDG acquired the site in late 2024, with its position directly opposite Crown's main entrance and near Melbourne's Arts Precinct making it one of Southbank's most significant remaining development opportunities.

<img alt="PDG" data-entity-type="file" data-entity-uuid="3933013e-6332-4386-b9be-089df05caf17" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-27%20at%209.29.22%E2%80%AFAM.png?VersionId=sITIgBqDL0N3VNSMwWEmF5UA.uvcsRyu" />

Designed by COX in collaboration with ODO and PDG, the tower's architecture draws on the movement of the Yarra River, with six vertical pleats running the height of the sculpted facade.

The project will also see the heritage-listed Queens Bridge Hotel restored and incorporated into the development&nbsp;with new hospitality and public uses, including a rooftop venue.

A significant component of The One will be its residential amenity.

More than 5,000 sqm of resident facilities will be delivered across a single level, making it one of the largest consolidated residential amenity offerings proposed in an Australian apartment development.

The planning approval also incorporates a major upgrade of Queensbridge Square, which PDG will deliver in partnership with the City of Melbourne.

<img alt="PDG" data-entity-type="file" data-entity-uuid="73167fcd-1031-4b6f-a408-a064cfe45ed1" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-27%20at%209.29.17%E2%80%AFAM.png?VersionId=Pf1AEWxw6SNmBqR0zQW5lyEze.MtxgFp" />

The existing square will be revitalised as a new civic and pedestrian space along the Yarra River, strengthening the connection between the project, Southbank and the riverfront.

PDG Founder and Managing Director Vince Giuliano said the approval represented a major milestone for a site which has remained largely underutilised for more than 15 years.

“This is the most significant Planning Permit approval Melbourne has seen in recent years,” Giuliano said.

“For more than 15 years, this site has remained underutilised. This approval enables us to deliver a project that will contribute meaningfully to the revitalisation of Southbank, restore and reactivate an important heritage building, and create a new civic and hospitality destination for Melbourne.”

The latest approval follows an earlier planning permit issued by the City of Melbourne covering demolition works across part of the site at 9-29 Queens Bridge Street. Those demolition and early works are already underway.

PDG has also started generating early interest in the residential component from owner-occupiers ahead of a planned public launch in early 2027.

PDG secures approval for $1.5bn Southbank apartment development, The One

Interest Rates

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Heritage Bank are the latest to announce they are cutting rates following the RBA's decision earlier in the month to cut for the first time since August 2016.
Heritage Bank haven't passed on the full rate cut, deciding to cut its variable home loan rates by 20 basis points.
Their Discount Variable home loan rate is now 3.57%, down from 3.77%.
Peter Lock, CEO of Heritage Bank, says the rates remained among the sharpest available in the market place.
He said Heritage had considered the best interests of all its customers, investors as well as borrowers, in coming to the decision.
“We have to think about both depositors and borrowers when we make these decisions.
“A 0.20% reduction in variable rates means our rates remain highly competitive, and strikes the right balance for us and our customers.”
Lock said Heritage’s customer-owned status meant it did not have the deep pockets of the big banks.
“We don’t set out to make massive profits, so our margins are lower than the big banks. In addition the big banks have a funding cost advantage that smaller customer-owned banks don’t enjoy. We continue to actively work with the Government to address this imbalance.  “Despite the imbalance we still have home loan interest rates that as a whole remain lower than those offered by the big banks.”
“We always make decisions to balance the best interests of all our customers at heart, not to maximise profit, so our rates stayed lower through that period.”
Of the big four banks, <a href="/news/cba-announce-full-rate-cut-after-june-rba-meeting">Commonwealth Bank</a> and <a href="/expert-insights/finance/nab-joins-cba-in-full-0-25-rate-cut-to-historic-lows">NAB</a> both passed on the full rate cute, while ANZ <a href="/expert-insights/finance/anz-first-to-pass-on-part-of-june-2019-rba-rate-cut">passed on 18 basis points</a> and Westpac <a href="/expert-insights/finance/westpac-to-cut-by-0-2-but-more-for-io-borrowers">passed on 20 basis points</a>.
Demand for fixed loans rising
Despite the declining variable rates across the majority of banks and lenders, it was demand for fixed rate home loans that rose in May.
According to new data from Mortgage Choice, fixed rate home loans rose over May, accounting for 22.47% of all home loans written.
Mortgage Choice CEO Susan Mitchell said over the last 12 months, fixed rates have accounted for 21.81% of all loans written.
"When you consider what has been happening in the market, the increase in demand is hardly surprising," Mitchell said.
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2019/6/20/Mortgage%20Choice%20May%20rates.jpg" alt="">
“Lenders on our panel have been aggressively discounting fixed rate home loan products, which has been effective in enticing more borrowers to commit to a fixed term.  “With rates as low as 3.49% p.a*., it’s unsurprising to see an increasing proportion of borrowers choosing to fix.” The data revealed that fixed rate demand was highest in Queensland, where 26% of borrowers opted for this type of home loan. 
This was followed by Western Australia, where 25% of borrowers chose to fix the interest rate on their home loan. Borrowers in Victoria were the least likely to fix, with 15% of borrowers choosing this type of product.   The most popular home loan products in May were ongoing discount Variable Rate loans followed by Basic Variable rates. “For those borrowers who may be considering fixing part or all of their home loan, now could be a good time to do so," Mitchell said.
"Current fixed-rate loan pricing presents good value by long-term standards. 
Mitchell suggested it is good new in particular for first home buyers who are looking to take advantage of government schemes and record low interest rates to enter the property market. 
“While news of low interest rates is certainly going to pique borrower interest, it’s equally important that borrowers remember the interest rate isn’t the only component of a home loan and they should look for the right loan product and features for their short and long-term needs." 
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jrobinson-rf4aSBido9

Rate cuts continue as Heritage Bank pass on 20 basis point cut

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ME Bank has announced a historic rate cut, slashing its 2 year fixed home loan rate to 3.43% p.a. – the lowest rate ever offered by the bank.
ME’s 2-year fixed rate is available to home loan customers with a Member Package (for owner occupiers paying principal and interest with an LVR &lt;80%).
The bank has made further rate cuts across its fixed home loan range by as much as 30 basis points.
The changes come into effect on the 18th June 2019.
ME Bank previously announced they will be passing on the full RBA rate cut to variable home loan customers.
The announcement came three days after the <a href="/expert-insights/finance/rba-cut-official-cash-rate-to-a-historic-low-1-25-at-june-2019-meeting">RBA rate decision</a> and was to come into effect on 27th June 2019.
<img src="https://www.urban.com.au/images/2019/6/18/ME%20Bank%20new%20rates.JPG" alt="">
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j.ballantyne1990-6AQqhLzZaK

ME Bank cuts fixed home loan rates to record low of 3.43 per cent

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Australia’s low rate lenders continue to battle it out with variable rates reaching as low as 3.09 per cent.
Over the past few days, non-bank lender Reduce Home Loans launched a new product at 3.09 per cent, receiving the honor of the new lowest ongoing variable rate.
The product is for new customers with a 40 per cent deposit (60% loan-to-value ratio, LVR).
Mortgage House has also dropped its lowest variable rate in the past couple of days, down to 3.14 per cent for people living outside of NSW with a 30 per cent deposit (70% LVR), while loans.com.au has dropped its lowest rate to 3.28 per cent.
<img src="https://www.urban.com.au/images/2019/6/13/Latest%20cuts%201.JPG" alt="">
(Source: Ratecity.com.au)
Ubank, a subsidiary of it's parent company NAB has announced it will be passing on the full 0.25% rate cut effective June 28, and will apply to both new and existing customers.
<div class="cell-value" data-reactid="181">One competitor, Greater Bank, has broken the 3% barrier with a fixed home loan rate of just 2.99% for the first year before being bumped to 4.1%.</div>
<div class="cell-details" data-reactid="182"> </div>
<div class="cell-details" data-reactid="182">Further below are the lowest fixed home loan rates for 1, 3 and 5 year home loans as well as the latest changes to savings and deposit rates.</div>
RateCity.com.au research director Sally Tindall said the non-bank lenders were climbing over each other to claim the lowest rate.
“Ideal borrowers are increasingly being rewarded with lower rates. If you’re an owner-occupier paying down your debt with a bit of equity up your sleeve you’re in the box seat when it comes to rates."
“If the RBA cuts again, we will almost certainly see variable rates drop below 3 per cent,” she said.
A side effect of the ongoing rate cuts is that Australia’s credit card debt accruing interest has slid to the lowest level in over 11. 
The RBA credit card statistics released this week show Australia’s debt accruing interest on personal credit cards is now $29.5 billion, down 4.9 per cent year-on-year, and at it's lowest levels since December 2007.
Notably the number of personal credit card accounts has fallen 3.1 per cent year-on-year.
There are now 470,088 fewer active accounts than there were in April 2018.
In addition to this Sally Tindall said, “banks are cracking the whip at their end under instructions from ASIC to assess a person’s ability to repay their entire credit card limit within three years."
“As a result, credit limits have fallen to the lowest level in more than three and half years as new customers are being forced to cut back," she concluded.
<img src="https://www.urban.com.au/images/2019/6/13/Latest%20cuts%202.JPG" alt="">
(Source: Ratecity.com.au)
New research from Finder found that Australian households could lose over a billion dollars in interest on their savings, following the Reserve Bank’s cash rate cut on Tuesday. 
According to their findings, if banks pass on the RBA’s 25 basis point interest rate cut in full, Australians will lose a whopping $1.3 billion in interest over the course of a year. 
<img src="https://www.urban.com.au/images/2019/6/13/latest%20savings%20cuts.JPG" alt="">
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What are the latest home loan cuts and who's making them? 

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EXPERT OBSERVER
<div id="post-body-8300417078442297736" class="post-body entry-content">
<div>One of the most important releases of the global calendar, the US nonfarm payrolls, confirmed things are turning back down in the face of slower growth and trade war concerns. </div>
<div> </div>
<div>Earlier in the week there had been a similarly weak indicator from a private payrolls report.</div>
<div> </div>
<div>Nonfarm payroll employment increased by just +75,000 in May 2019 according to the Bureau of Labor Statistics, and critically there were also substantial downwards revisions to March (-36,000) and April (-39,000). </div>
<div> </div>
<div>Combine a weak monthly gain of +75,000 with a combined revision of -75,000 and you get...not very much, although at least this did mark a record 104 consecutive months of gains. </div>
<div> </div>
<div>The 3-month average gain is now just above +150,000, having been above +200,000 for much of 2018 and 2019. </div>
<div> </div>
<div class="separator"><img src="https://1.bp.blogspot.com/-oCxVjG5jgE4/XPrPZcmCKyI/AAAAAAAAwZo/XIaPMHwveNQBQXCQcFF_y92gxVmx3g-7QCLcBGAs/s640/NFP1.jpg" width="640" height="368" data-original-height="800" data-original-width="1389"></div>
 The unemployment rate held steady at 3.6 per cent. <div class="separator"><img src="https://1.bp.blogspot.com/-VV6mk5t6S2Q/XPrPZQdLQBI/AAAAAAAAwZs/3T9WL5W_p5MDtBBnLiuydEN132e6RBW4QCLcBGAs/s640/NFP2.jpg" width="640" height="382" data-original-height="833" data-original-width="1390"></div>
 But annual average hourly earnings growth slowed to +3.1 per cent. <div class="separator"><img src="https://1.bp.blogspot.com/-6K-7SN1xz_A/XPrPZfVYmjI/AAAAAAAAwZw/6CDgCikRDroi5irW2jUAMrfmfWIjNo5_ACLcBGAs/s640/NFP3.jpg" width="640" height="364" data-original-height="790" data-original-width="1385"></div>
<div> </div>
<div> </div>
<div>A couple of Antipodean observations.</div>
<div>
 Firstly, hard though it is to imagine, markets are pricing a 4 in 5 chance of the Fed cutting interest rates as soon as July(!). </div>
<div> </div>
<div>And secondly, looking at unemployment rates from Japan to Germany, Netherlands, the US, UK, Taiwan, and South Korea - all 4 per cent or considerably lower in many cases - it's not hard to imagine that Australia's NAIRU could be much lower than previously assumed. </div>
<div> </div>
<div>For that reason and others, markets are now pricing in two further rate cuts in Australia over the next 12 months.</div>
<div> </div>
<div>I was travelling yesterday and didn't get around to posting the pre-election housing finance figures, which showed a small uptick for homebuyers and a decline for investors.</div>
<div> </div>
<div>Speaking with a few mortgage brokers yesterday, there has been a surge of enquiries since the election, and especially now interest rate cuts are being passed on.</div>
<div> </div>
<div>Importantly, while banks were previously taking up to a couple of months to return documentation, not the figure is back down to about a week, so things are 'back to normal' in that regard. </div>
<div> </div>
<div>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>. </div>
</div>
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pwargent-M4siyDbqQY

Rate hiking cycle crashes and burns: Pete Wargent

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ME Bank has announced they will be passing on the full RBA rate cut to variable home loan customers.
The announcement comes three days after the <a href="/expert-insights/finance/rba-cut-official-cash-rate-to-a-historic-low-1-25-at-june-2019-meeting">RBA rate decision</a> and comes into effect on 27th June 2019.
On the day of the RBA rate decision all of the Big Four banks as well as a number of smaller lenders announced cuts of varying size.
Both <a href="/expert-insights/finance/nab-joins-cba-in-full-0-25-rate-cut-to-historic-lows">NAB</a> and <a href="/news/cba-announce-full-rate-cut-after-june-rba-meeting">CBA</a> announced they will be passing on the full rate cut. But <a href="/expert-insights/finance/anz-first-to-pass-on-part-of-june-2019-rba-rate-cut">ANZ is only passing on a cut 0.18 basis points</a>, something Treasurer Josh Frydenberg especially disapproved of stating, “I think the ANZ has let down its customers."
<a href="/expert-insights/finance/westpac-to-cut-by-0-2-but-more-for-io-borrowers">Westpac was the last of the big four</a> to announce they were cutting rates, following the RBA's decision they announced their rate cuts late on Tuesday of 0.20 basis points.
ING, the nation’s fifth largest home loan lender chose to pass the full 0.25 per cent cut on to their variable rate customers, effective 25 June 2019.
Popular banks that have yet to announce their intentions include HSBC and AMP.
 
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ME Bank to pass on full RBA rate cut

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EXPERT OBSERVATION
Australian GDP rose by 0.4% in the March quarter and annual growth slowed to 1.8%, which missed market forecasts of 0.5% and is also a little weaker than the RBA's recent forecasts. This was the weakest annual growth since September 2009.
The weakness in the Australian economy that started in mid-2018 has continued into early 2019 with the latest GDP data showing low economic growth in the March quarter (see chart below).
What’s more the make-up of growth in the March quarter remains concerning with falling private final demand for the second quarter in a row. Were it not for government spending and net exports GDP growth would have been zero.
We expect that this low growth environment will continue in Australia for now and we see GDP growth averaging around 1.75% over 2019, which is below RBA’s forecasts for growth around 2.75%.  
The economy is now in its 28th year of recession-free economic growth, and while the near-term outlook for growth still looks positive as the various parts of the economy muddle through, the outlook for 2020 looks challenging as government infrastructure spending looks like it will slow after this year, residential construction looks likely to continue to decline, the consumer is expected to remain weak and risks are building around the global economic outlook as a result of Trump’s trade wars. So we see a higher risk of an Australian recession in 2020 (risk of around 25% from 15% before).
More RBA interest rate cuts along with fiscal stimulus are likely to be necessary to offset the threat to growth. 
<a href="https://www.propertyobserver.com.au/images/2019/6/5/gdp%20growth.png" target="_blank">Click here</a> to enlarge: 
<img src="https://www.urban.com.au/images/2019/6/5/gdp%20growth.png" alt="">
Source: ABS, AMP Capital
The key components of the data are:
<ul type="disc">
<li>
Consumer spending rose by 0.3%, contributing 0.1 percentage points to March quarter GDP, and annual growth in spending declined to 1.8%. The household savings rate increased again, to 2.8% after bottoming at 2.5% in the September quarter. We expect that the fall in home prices and the associated negative wealth effect will push the household savings ratio higher over the next 1-2 years which will be a drag on consumer spending as wages growth is stuck at just over 2%. But consumer spending will benefit from the latest RBA interest rate cut (and further potential cuts) as well as tax stimulus, announced in the Federal Budget which will be paid after July when households do their tax return.</li>
</ul>
<ul type="disc">
<li>
Housing investment continues to decline with residential construction down by 1.8% in the March quarter, alterations and additions spending falling by 3.8% and ownership transfer costs (a proxy for housing turnover activity) plummeting by 13.0% which all detracted 0.3 percentage points from growth. Building approvals for residential property have continued to fall so there is still further downside to residential construction. </li>
</ul>
<ul type="disc">
<li>
Underlying business investment (which takes into account asset transfers between the private and public sector) rose by 0.5% and contributed 0.1 percentage points to growth. Non-residential building activity is lifting after many quarters of weakness, engineering construction fell and machinery and equipment investment declined marginally. The outlook for non-mining investment is still looking okay, particularly for manufacturing, and mining investment looks like it is starting to lift again after falling since 2012 as commodity prices have held up well. </li>
</ul>
<ul type="disc">
<li>
Underlying government spending (which takes into account asset transfers between the private and public sector) rose by 0.7% and contributed 0.2 percentage points to growth. State and Federal government spending on infrastructure has been driving public spending over the past few years. While there are still many projects in the construction pipeline (particularly for transport), the pace of growth in public spending is declining and recent state government budgets indicate lower revenue (as stamp duty collections have fallen) and therefore some tightening in state fiscal spending which means that government spending growth will start to slow and in the absence of more infrastructure projects may become a drag on the economy later in 2020.</li>
</ul>
<ul type="disc">
<li>
Inventories detracted 0.1 percentage points from growth as farm and public inventories collapsed (following a build up in the prior quarter) but private inventories increased.</li>
</ul>
<ul type="disc">
<li>
Net exports contributed 0.2 percentage points to growth with a rise in export volumes and a fall in import volumes. Australia’s external sector is doing extremely well from the booming iron ore price (around $100USD/tonne) which is a boost to the government’s budget. But the risk is that the weakening global environment, particularly around trade, will hit net exports.</li>
</ul>
<ul type="disc">
<li>
Inflation pressures and wages growth are still poor. Inflation as measured by the private final consumption deflator was just 0.4% in the March quarter or 1.5% over the year. Average compensation per employee was up by just 0.4% or 1.4% over the year which is well below the wage price data (of 2.3% year on year) reflecting compositional changes.</li>
</ul>
<ul type="disc">
<li>
Productivity declined by 0.4% in the March quarter and is down by 0.9% which reconciles the divergence between strong employment growth and the weakening GDP numbers. </li>
</ul>
Implications
With economic growth running well below potential, which is around 2.75%, the RBA will need to cut interest rates multiple times to get growth up and get the unemployment rate down below 4.5% (it is currently 5.2%) in order to get inflation back into its 2 to 3% target range.
We see another 0.25% rate cut in July or August and two more rate cuts in the first half of 2020 which will take the cash rate to 0.5% in 2020. Hopefully additional fiscal stimulus will help too. The need for quantitative easing is a rising risk, but hopefully it won’t be necessary.  
DR SHANE OLIVER is the Head of Investment Strategy and Chief Economist at AMP Capital.
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soliver-smf6LQXgW9

RBA to cut interest rates to 0.5%: Shane Oliver 

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EXPERT OBSERVER
The Reserve Bank cut interest rates on Tuesday because we aren’t spending or pushing up prices at anything like the rate it would like. And things are even worse than it might have realised.
As the board met in Martin Place in Sydney, in Canberra at 11.30 am the Bureau of Statistics released details of retail spending in April, one month beyond the March quarter figures the bank was using to make its decision.
They show the dollars spent in shops fell in April, slipping 0.1%, notwithstanding weakly growing prices and a more strongly growing population.
The March quarter figures the board was looking at were adjusted for prices. They show that the volume of goods and services bought, but not the amount paid for them, fell in seasonally adjusted terms during the March quarter.
Adjusted for population, the volume bought would have fallen further.
<h2>We’ll know more on Wednesday</h2>
The Bureau of Statistics will release population-adjusted figures as part of the national accounts on Wednesday.
The figures for the September quarter show that income and spending per person barely grew. The figures for the December quarter show income and spending per person fell.
A second fall in the March quarter will mean two in a row – what some people call a per capita recession.
<hr>
<a href="https://images.theconversation.com/files/275325/original/file-20190520-69186-1pvxbji.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/275325/original/file-20190520-69186-1pvxbji.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a> <a class="source" href="https://www.propertyobserver.com.au/http://www.abs.gov.au/ausstats/abs@.nsf/mf/5206.0" target="_blank">Australian National Accounts</a>
<hr>
Even unadjusted for population, economic growth is dismal.
During the September and December quarters the economy grew just <a href="https://www.propertyobserver.com.au/http://www.abs.gov.au/ausstats/abs@.nsf/mf/5206.0" target="_blank">0.3% and 0.2%</a> – an annualised rate of just 1%.
That’s well short of the <a href="https://www.smh.com.au/business/the-economy/myefo-treasury-downgrades-its-budget-projections-20151124-gl6mfd" target="_blank">2.75%</a> the treasury believes we are capable of, and the lower than normal <a href="https://budget.gov.au/2019-20/content/overview.htm" target="_blank">2.25%</a> it has forecast for the year to June.
<hr>
<a href="https://images.theconversation.com/files/275322/original/file-20190520-69199-1ir7rrj.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/275322/original/file-20190520-69199-1ir7rrj.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a> <a class="source" href="https://www.propertyobserver.com.au/http://www.abs.gov.au/ausstats/abs@.nsf/mf/5206.0" target="_blank">Australian National Accounts</a>
<hr>
We’ve been doing it by ourselves. As Reserve Bank Governor Philip Lowe said in <a href="https://www.rba.gov.au/media-releases/2019/mr-19-15" target="_blank">announcing the rates decision</a> on Tuesday:
"The main domestic uncertainty continues to be the outlook for household consumption, which is being affected by a protracted period of low income growth and declining housing prices."
The bank wants both inflation and employment higher, and it wants us to spend more in order to do it. Lower rates should help, although <a href="https://theconversation.com/why-the-reserve-bank-shouldnt-but-might-cut-interest-rates-on-tuesday-116354" target="_blank">not for everybody</a>.
Lowe acknowledged this in a <a href="https://www.rba.gov.au/speeches/2019/sp-gov-2019-06-04" target="_blank">speech to a Sydney business audience on Tuesday night</a>, but he said households paid two dollars in interest for every one dollar of interest they received. So while rate cuts hurt savers, they benefit borrowers by more, and over time should benefit all households by boosting the economy. They also drive the dollar lower, making Australian businesses more competitive.
Tuesday’s cut should free up an extra A$60 a month for a typical mortgage holder. Another one will free up a total of A$120.
It’s not much, and there’s doubt about whether it will do much, but interest rates are about the only tool the Reserve Bank has.
It is required by its agreement with the government to aim for an inflation rate of between <a href="https://rba.gov.au/monetary-policy/framework/stmt-conduct-mp-7-2016-09-19" target="_blank">2% and 3%</a>, “on average, over time”.
<img src="https://images.theconversation.com/files/270879/original/file-20190425-121220-1csg8ma.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt="">Treasurer and Reserve Bank Governor, Statement on the Conduct of Monetary Policy, September 19, 2016. <a class="source" href="https://rba.gov.au/monetary-policy/framework/stmt-conduct-mp-7-2016-09-19" target="_blank">Reserve Bank of Australia</a>
Uncomfortably for Governor Lowe, underlying inflation (abstracting from unusual moves which are quickly reversed) has been below 2% ever since he was appointed governor in late 2016.
Explaining his push for higher inflation to a business audience in Sydney on Tuesday night he said that while adherence to the target was intended to be flexible, that flexibility was “not boundless”.
"If inflation stays too low for too long, it is possible that inflation expectations move lower – that Australians come to expect sub-2% inflation on an ongoing basis. If this were to happen, it would be harder to achieve the medium term inflation goal. So we need to guard against this possibility."
He is also required to <a href="https://rba.gov.au/monetary-policy/framework/stmt-conduct-mp-7-2016-09-19" target="_blank">aim for full employment</a>.
He told the business audience that while for some years the bank and others had thought full employment meant an unemployment rate of 5%, the absence of inflation at 5% and the persistence of underemployment (where people wanted more hours) meant it could and should go lower.
"Our judgement now is that we can do better than this – that we can sustain an unemployment rate of 4 point something."
Lower interest rates should help by making it easier to businesses to borrow to expand, and giving consumers something in their pockets to buy from them.
<h2>If you don’t succeed…</h2>
If that doesn’t happen, the bank will cut again.
Tuesday’s statement as good as said so:
"The board will continue to monitor developments in the labour market closely and adjust monetary policy to support sustainable growth in the economy and the achievement of the inflation target over time."
Tuesday’s cut and the next will take the bank into uncharted waters, where its so-called cash rate – what it pays to banks to deposit money with it overnight – is close to zero.
As far as can be discerned it has never been that low in the 100+ years the Reserve Bank has been in operation, originally as the Commonwealth Bank of Australia.
<hr>
Reserve Bank cash rate since 1990
<a href="https://images.theconversation.com/files/277841/original/file-20190604-69059-1j2m4r9.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/277841/original/file-20190604-69059-1j2m4r9.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a> <a class="source" href="https://www.rba.gov.au/media-releases/2019/mr-19-15" target="_blank">Reserve Bank of Australia</a>
<hr>
Should inflation still not pick up and employment still not fall as far as it believes it could, it will have to effectively cut its cash rate below zero, forcing cash into the hands of banks by aggressively buying government bonds, giving them little choice but to lend it to households and businesses, in a process known as quantitative easing. It has been done in the United States, Europe, the United Kingdom and Japan, and is by now <a href="https://www.bankofengland.co.uk/monetary-policy/quantitative-easing" target="_blank">anything but unconventional</a>.
Governor Lowe would prefer the government to pull its weight by cutting tax and boosting spending, especially on infrastructure, and by policies that make Australia more productive.
He said so on Tuesday night
"The best approach to delivering lower unemployment and a stronger economy is through structural policies that support firms expanding, investing, innovating and employing people. As we ease monetary policy, it is in the country’s interest that other policy options are considered too.
Treasurer Josh Frydenberg gets it.
He pointed out on Tuesday that the yet-to-be-approved tax offsets in the budget will give Australians on up to A$126,000 a cash bonus of up to A$1,080 when they submit this year’s tax return, far more than the rate cut.
His biggest concern, and the biggest concern of the governor, might be that they don’t spend it. Another concern would be that the banks don’t pass the rate cut on.
The ANZ has said it will only cut mortgage rates by 0.18 points instead of the full 0.25, a decision Frydenberg said “let down” customers. Westpac has cut by only 0.20 points. The National Australia and Commonwealth banks have passed on the cut in full.
On Tuesday night in Sydney Governor Lowe addressed the question of whether the banks should have passed on the full cut head on:
"My usual practice in answering this question has been to explain that there are a range of other factors that influence mortgage pricing, and then say “it all depends”.
"Today, though, I would like to break with my usual practice and provide a clearer answer. And that is: Yes. There has been a substantial reduction in the cost of banks raising funds in wholesale markets. Average rates on retail deposits have also come down.
This means that the lower cash rate should be fully passed through into standard variable mortgage rates. Full pass-through would also mean that the economy receives the full benefit of today’s policy decision.
The Governor is concerned that, for their own reasons, lenders such as ANZ and Westpac are forcing him to cut rates lower than he should and making an already difficult job harder.
If he has to cut further he will, but with the cash rate at just 1.25%, he would dearly love not to have to.
<a href="https://images.theconversation.com/files/277854/original/file-20190604-69071-xecu9u.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/277854/original/file-20190604-69071-xecu9u.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a> <a class="source" href="https://www.rba.gov.au/media-releases/2019/mr-19-15" target="_blank">Reserve Bank of Australia</a>
<a href="https://theconversation.com/profiles/peter-martin-682709" target="_blank">Peter Martin</a>, Visiting Fellow, <a href="http://theconversation.com/institutions/crawford-school-of-public-policy-australian-national-university-3292" target="_blank">Crawford School of Public Policy, Australian National University</a>
This article is republished from <a href="http://theconversation.com" target="_blank">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/the-reserve-bank-will-cut-rates-again-and-again-until-we-lift-spending-and-push-up-prices-118263" target="_blank">original article</a>.
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The Reserve Bank will cut rates again and again, until we lift spending and push up prices

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NAB has announced they will reduce all standard variable rate (SVR) home loans by 0.25% per annum, in line with the RBA announcement.
As a result the bank’s SVR will be the lowest it has been in more than 40 years.
Mike Baird, Chief Customer Officer – Consumer Banking said, “we strongly believe reducing rates is the right thing to do by our customers and reflects our focus on earning trust in the community and rewarding our loyal existing customers."
“This will save owner-occupier customers making principal and interest repayments on a $400,000 home loan about $62 per month or $744 per year, which will provide more money in household budgets for other expenses at a time when cost of living remains challenging,” Mr Baird added.
NAB will reduce all standard variable rate home loans by 0.25% per annum, making it their lowest rates they've offered in more than 40 years.
<img src="https://www.urban.com.au/images/2019/6/4/NAB%20new%20rates.JPG" alt="">
(Source: NAB)
NAB are the third of the Big Four banks to reduce rates following the announcement and the second to reduce rates at an equal amount to that of the full RBA rate shift <a href="/news/cba-announce-full-rate-cut-after-june-rba-meeting">as CBA did</a>.
ANZ, the first of the Big Four <a href="/expert-insights/finance/anz-first-to-pass-on-part-of-june-2019-rba-rate-cut">to announce rate reductions</a>, will only reduce SVR loans by 0.18 basis points.
 
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NAB joins CBA in full 0.25% rate cut to historic lows

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The Commonwealth Bank (CBA) have announced they will be passing on the full RBA rate cut of 0.25 basis points.
Effective from June 25 CBA's standard variable rate home loans will be reduced by 0.25% p.a.
Angus Sullivan Group Executive Retail Banking Services said, “we have carefully considered the RBA rate decision and the current funding environment, together with how we continue to meet our regulatory commitments, capital requirements, and community expectations."
By reducing the standard variable home loan rate by 0.25%, the minimum required monthly repayment amount will reduce by $62 a month, based on a mortgage of $400,000 for Owner Occupiers paying Principal and Interest.
CBA was the second of the Big Four banks to make this announcement as <a href="/expert-insights/finance/anz-first-to-pass-on-part-of-june-2019-rba-rate-cut">ANZ beat them to the punch</a> with an announcement of rate cuts just 9 minutes after the RBA released their decision.
ANZ's new lowest rate will be 3.63%, however they are only passing on a cut of 0.18 basis points effective June 14.
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CBA announce full rate cut after June RBA meeting

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The ANZ was the first of the big four banks to cut rates, nine minutes after today's RBA decision.
They didn't pass on the full 0.25% rate cut with rates reduced only by 0.18 basis points effective June 14.
ANZ Group Executive, Australia Retail &amp; Commercial, Mark Hand said, “in making this decision we have weighed up a number of factors, such as business performance, market conditions and the impact on our customers, including our depositors.”
“I think the ANZ has let down its customers,” the federal Treasurer Josh Frydenberg said after the RBA decision and the ANZ response. 
“This is deeply disappointing from the ANZ,” Mr Frydenberg said.
Athena was the first non-bank lender to reduce rates, and they passed on the whole cut, reducing rates by 0.25 basis points.
The Sydney based online lender announced a new headline variable rate for owner-occupiers paying principal and interest of 3.34 per cent p.a. within 15 minutes of the RBA decision.
Athena only entered the home loan market this year.
The next to cut rates is Reduce Home Loans making their reducing their rates by 0.25 basis points. 
RACQ Bank have also announced they will also pass on the whole 0.25 per cent rate cut.
At 3:50 the Commonwealth Bank (CBA) announced a full rate cut effective from June 25.
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