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

Joel Robinson

The Eveleigh brings house-like apartments to Broadbeach

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

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

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

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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

Interest Rates

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The Reserve Bank of Australia board has noted the most prudent course ahead was likely to be a period of stability in interest rates.
Members observed housing market conditions remained strong, with housing prices rising in March to be 10.5% higher over the year on a nationwide basis. 
They also noted that dwelling investment had increased moderately in the December quarter, with a pick-up in renovation activity and that the high level of dwelling approvals in recent months foreshadowed a strong expansion in dwelling investment.
The April meeting minutes also noted financial markets and money market rates in Australia continued to imply that the cash rate was expected to remain unchanged over the remainder of the year.
Members began their discussion of the domestic economy acknowledging a range of indicators of labour demand suggested a modest improvement in prospects for employment, although the unemployment rate was still expected to edge higher for a time.
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jchancellor-FAypfDUnLy

RBA says period of stability in interest rates lies ahead: April minutes

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With generally positive labour market figures for March 2014, AMP Capital has renewed its prediction of a rate hike in September or October, virtually ruling out the possibility of another rate cut this year.
According to the latest ABS Labour Force figures, March saw seasonally adjusted employment rise by 18,100 people, ahead of market expectations of a 2,500 person gain.
Following a 48,200 gain in February, employment is now up 1.1% from a year ago.
Unemployment fell in March, now at 5.8% from an upwardly revised figure of 6.1% in February. However, the decrease can largely be explained by a fall in the participation rate, which AMP Capital’s chief economist and head of investment strategy Shane Oliver also believed factored into an “odd slump” in Western Australia’s unemployment figure which fell from 5.9% to 4.9% for the month.
Full time jobs were down 22,000 for the month across Australia, after an 80,000 job gain in February.
According to Oliver, the “messy details” of the ABS’s latest report and the tendency for monthly volatility in labour data highlights the importance of trend data, which shows monthly jobs growth of about 14,000, with unemployment rising slowly.
Given the available data, AMP considers Australia’s job market better off than media reports suggest, though not as strong as implied in February and January’s data. Forward looking employment indicators such as job vacancies, job ads and hiring intentions as detailed in the NAB Business Survey (see below) suggest gradual improvements in the jobs market. 
<img src="/images/2014/04/15/chart%20april%2015%20one.png" alt="">
While AMP expects that the rising value of the Australian dollar is likely to become a cause for concern for the Reserve Bank, the investment house predicts that the RBA will “renew jawboning efforts” to suppress the dollar’s international value in the coming months, rather than adjusting interest rates. The Australian dollar sits at US$0.94 at the time of writing.
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jrichardson-uRX5hFdKfN

Employment up for March with rate hike expected later this year: AMP

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As widely expected the Reserve Bank of Australia (RBA) decided again to leave the cash rate in a holding pattern for the seventh straight meeting although somewhat surprising the rhetoric was considerably different this time around.
Sydney is the elephant in the room with house prices jumping 15.6% in the last year according to RP Data, although I would add that this is a lazy way of explaining and defining the property markets across Sydney given they are all performing differently – some are hot and some are not.
Back to the RBA where in an extraordinary week we heard both Glenn Stevens and treasury secretary Martin Parkinson publicly declaring that Australia needs to be closely looking at and discussing taxes and government spending. Well not before time. We are fast drawing the conclusion that the elected ones in Canberra have absolutely no idea how to run a business – they appear to be the only ones who don’t believe that the rate of GST needs to be increased.
Reading between the lines there was a clear concern about what will be brought down in the May budget with a clear indication together with framed criticism by Glenn Stevens: “Put simply, there are things that we want to do as a society, and have voted for, that are not fully funded by taxes over the medium term, as is starting to become clear in the lead up to the May budget.”
<blockquote>
As strange as it might sound, I’m looking forward to seeing the cash rate increases.
</blockquote>
Personally I think it is fabulous when the likes of Messrs Parkinson and Stevens have the fortitude to publicly speak their minds by firing shots at the government on the eve of the budget. Let’s fill in a few gaps – NDIS and paid parental leave are the main culprits to which they were referring.
A perfect case in hand that should be at the forefront of the Abbott government's mind is that $16.2 billion Building and Education Revolution, the master class of the Rudd and Gillard terms which has now been condemned as an international case study of legislative and bureaucratic failure. Reading between the lines again, it would appear that Messrs Stevens and Parkinson are politely pointing out that the Australian economy can ill afford repeats of policy failures.
When you’ve been selling real estate for nearly 30 years, interest rates scare the living daylights out of you! And, as strange as it might sound, I’m looking forward to seeing the cash rate increases. Many economists are suggesting that this will happen in 2015 although I am of the opinion we will start seeing increases sooner rather than later with small increment increases.
<img src="/images/2014/04/07/simeon-april-7-one.jpg" alt="">
<img src="/images/2014/04/07/simeon-april-7-two.jpg" alt="">
<a href="https://www.smh.com.au/business/the-economy/housing-bubble-fears-property-prices-could-fall-10-to-20-per-cent-20140331-35sg7" target="_blank" title="Housing bubble fears: property prices could fall 10 to 20 per cent">Housing bubble fears: property prices could fall 10 to 20%</a> was an interesting piece by Christopher Joye although it lacks market definition. Yes, certain parts of the Australian real estate market are over inflated, those being the new suburbs crashing through the $1,000,000 mark for the very first time which will, as history has shown, be the hardest and fastest hit. By comparison the traditional markets such as Paddington, Mosman, Pymble and Bondi, for example, are tracking upwards although at nowhere near the pace of the hotspot suburbs.
I can see the cash rate moving from its current rate of 2.50% to 3.50% next year which will in time place a number of households under increasing financial pressure, although we have seen this happen time and time again. Most notably in the early 2000s the cash rate fell from 6.25% in <a href="https://www.rba.gov.au/statistics/cash-rate/cash-rate-1997-2001" target="_blank" title="September 2000 to 4.25 per cent in December 2001">September 2000 to 4.25% in December 2001</a>. We then witnessed dramatic market corrections in south-west Sydney as the cash rate started climbing to <a href="https://www.rba.gov.au/statistics/cash-rate/cash-rate-2008-2014" target="_blank" title="7.25 per cent in March 2008">7.25% in March 2008</a> where it then started being eased to where we find it today at 2.50%.
So what amazes me more is that currently we are seeing record numbers of investors entering the market, which can be best described as panic buying – investors now make up 40% of value of total housing loan approvals in NSW and Victoria. So when and where we do see property market corrections this is when we see the astute investors entering the market – the experienced ones are certainly keeping their powder dry.
What this does clearly identify is that politicians and investors pay very little attention to history where more often than not they become part of history.
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robertsimeon-hRNTwJyXkQ

When it comes to interest rates investors should learn a bit from history

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While there has been talk around when interest rates will rise again, it appears that, for now at least, low interest rates might just be the new normal for investors.
After the Reserve Bank kept the interest rate on hold on Tuesday, surprising no one, 1300HomeLoan’s managing director John Kolenda has suggested that, despite continual suggestions of where the future rate may be heading, we’re likely to stick with lows for the foreseeable future. This, he noted, would make low rates the “new normal”.
“Prior to the global financial crisis the norm for the RBA's official rate was around the 5% mark,” he said.
“The historical rates over the last 30 years have been much higher than for the previous few years. Consumer confidence is playing a bigger role in determining rate movements.”
Potential increases over the next six to 12 months will still be low compared to historical rates, he noted.
“Based on the sensitivity of consumers to rate rises, we are likely to see medium term rates at historical lows and smaller variances in movement,” he said.
He claimed that anyone trying to predict a rise is “a brave person” until there’s more positive data broadly, rather than just rising house prices that the Reserve Bank has expressed concerns about.
 “In the current economic climate, the RBA has no choice but to keep rates on hold and likely to tread carefully if they raise sometime later this year,” he said, pointing to weak retail results, a slowdown in the resources sector and unemployment growth as counter balances to a strong housing market.
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jduke-EHk3XBmHkn

Low interest rates may be “new normal”: John Kolenda

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The Reserve Bank has kept rates on hold today, at a record low 2.5%. While debate rages over what might happen next, it appears many are predicting a rise in the last quarter of the year.
RP Data's Tim Lawless noted that the housing market statistics are likely to be the factor causing the Reserve Bank some additional deliberation.
"Dwelling values were up 2.3% in March taking the cumulative increase in dwelling values to 15.8% over the current growth cycle which commenced in June 2012," he said.
"While the headline growth rate is very high, it is really Australia’s two largest cities, Sydney and Melbourne, which are responsible for driving such high capital gains.  Dwelling values are up 22% and 17% across these two cities since June 2012."
He noted that it's not just these capital gains that will be a concern, but the amount of investment in the market, with investors comprising 38% of all new housing finance commitments. The last time investor numbers were this strong was before the housing boom in 2003.
"Clearly the rate of value appreciation across the Australian housing market has been unsustainably strong over the short-term, however the national economy is seeing a great deal of benefit from the increased level of both developer and buyer confidence which the RBA is likely to see as a positive outcome from the currently exuberant housing market conditions," he said, pointing to a potential increase in the future if value growth continues along its current mark.
"If value growth continues along the current trajectory through I think the Reserve Bank will be forced to take action to quell the level of exuberance via higher interest rates," he said.
This ties in with Property Observer's previously reporting an <a href="/expert-insights/finance/borrowers-warned-of-interest-rate-hikes-by-late-2014">increasing number of economists pointing to a late-2014 increase</a>.
Meanwhile, L Janusz Hooker, deputy chairman of LJ Hooker, said that leaving the cash rate at 2.5% should assist prices stabilising following a year of growth. Hooker also siad that the rate easing cycle is over.
"We have been seeing the benefits of those cuts every weekend at open inspections, people are still out house hunting or looking for investment properties," said Hooker.
"Buyers know it is likely rates will be on the increase some time in the next year and are factoring it into their budget."
Michelle Hutchison, money expert for Finder.com.au said that it's cheaper than ever to switch home loans at present, making the RBA's decision to keep rates on hold good news for consumers.
"More lenders are waiving application fees now than they were three years ago, and coupled with the banning of early exit fees on variable home loans in 2011, it's now cheaper to refinance than what borrowers may think," said Hutchison.
"The average cost to switch now out of variable loans that charge these fees is $719 compared to almost $900 in 2011," she said, noting that borrowers shouldn't wait for any further cuts from the Reserve Bank before seeking out a better deal.
The lack of change today was <a href="/expert-insights/finance/paul-bloxham-expects-rba-to-keep-rates-on-hold-next-week">also predicted by HSBC's Paul Bloxham last week</a>.
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Reserve bank holds interest rates, but property prices make an increase likely

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Glenn Stevens' April statement:
At its meeting today, the Board decided to leave the cash rate unchanged at 2.5 per cent.
Growth in the global economy was a bit below trend in 2013, but there are reasonable prospects of a pick-up this year. The United States economy, while affected by adverse weather, continues its expansion and the euro area has begun a recovery from recession, albeit a fragile one. Japan has recorded a significant pick-up in growth. China's growth remains generally in line with policymakers' objectives, though it may have slowed a little in early 2014. Commodity prices have declined from their peaks but in historical terms remain high.
Financial conditions overall remain very accommodative. Long-term interest rates and most risk spreads remain low. Equity and credit markets are well placed to provide adequate funding, though for some emerging market countries conditions are considerably more challenging than they were a year ago.
In Australia, the economy grew at a below trend pace in 2013. Recent information suggests slightly firmer consumer demand over the summer and foreshadows a solid expansion in housing construction. Some indicators of business conditions and confidence have improved from a year ago and exports are rising. But at the same time, resources sector investment spending is set to decline significantly and, at this stage, signs of improvement in investment intentions in other sectors are only tentative, as firms wait for more evidence of improved conditions before committing to expansion plans. Public spending is scheduled to be subdued.
The demand for labour has remained weak and, as a result, the rate of unemployment has continued to edge higher. It will probably rise a little further in the near term. Growth in wages has declined noticeably. If domestic costs remain contained, some moderation in the growth of prices for non-traded goods could be expected over time, which should keep inflation consistent with the target, even with lower levels of the exchange rate.
<blockquote>
Credit growth is slowly picking up. Dwelling prices have increased significantly over the past year.
</blockquote>
Monetary policy remains accommodative. Interest rates are very low and savers continue to look for higher returns in response to low rates on safe instruments. Credit growth is slowly picking up. Dwelling prices have increased significantly over the past year. The decline in the exchange rate from its highs a year ago will assist in achieving balanced growth in the economy, but less so than previously as a result of the rise over the past few months. The exchange rate remains high by historical standards.
Looking ahead, continued accommodative monetary policy should provide support to demand, and help growth to strengthen over time. Inflation is expected to be consistent with the 2–3 per cent target over the next two years.
In the Board's judgement, monetary policy is appropriately configured to foster sustainable growth in demand and inflation outcomes consistent with the target. On present indications, the most prudent course is likely to be a period of stability in interest rates.
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po-LsXgBTHBmX

Dwelling prices have increased significantly: RBA Governor Glenn Stevens

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The official cash rate set by the Reserve Bank of Australia has been at a historic low of 2.5% since August 2013. In line with that low rate, borrowers are paying less for home mortgages now than they have in over 15 years.
 <img src="/images/2014/03/28/zoe-march-28-one.jpg" alt="" style="line-height: 1.3em;"> 
Source: RBA
Lenders typically cut and lift mortgage interest rates roughly in line with the RBA’s movements, charging a margin over the official cash rates. Since late 2007, the extra amount of interest that consumers pay on a variable rate home loan above the official cash has been increasing.
Finder.com.au money expert Michelle Hutchison says lenders have been moving their rates out of cycle with the RBA and failing to pass on rate cuts in full, so the gap between the official cash rate and home loan rates available to borrowers has widened.
RBA data shows that the difference between the official cash rate and the mortgage managers’ basic variable rate – which approximates the average of interest rate actually available to borrowers – was fairly stable at just below 1 percentage point from September 1998 to September 2007. If that relationship still held true, home mortgages with variable interest rates of 3.5% and lower would be common in the market now.
In fact, RBA data shows that the mortgage managers’ basic variable rate was 5% in February 2014, a full 2.5 percentage points more than the official cash rate. Hutchison says the cheapest basic variable rate loan available is 4.49% for a $150,000 mortgage over 30 years from Loans.com.au.
 <img src="/images/2014/03/28/zoe-march-28-two.jpg" alt="">
Source: Reserve Bank of Australia
So, why aren’t headline lending rates lower?
Hutchison says one reason is that borrowers are letting lenders get away with charging more by not shopping around.
“If borrowers are not taking action and doing something about it by comparing home loans and switching to a better, cheaper deal, [lenders are] not going to do anything about it,” she says.
“There are hundreds of home loans on the market and the range of home loan prices is from 4.49% to over 9%. The best thing people can do is keep track of [interest rates]. Don’t sign up to a home loan and forget about it. Review your financial situation every year or two.” 
UBS interest rate strategist Matthew Johnson says few people pay the headline interest rates advertised by lenders. Advertised rates are higher in relation to the cash rate, but lenders have realised that people feel good about getting a discount. Those who are prepared to negotiate can get lower rates than the advertised rate.
Another key reason for the widening gap between the official cash rate and mortgage rates on offer to consumers is that the cost of funding and running a bank has gone up, Johnson says.
Two main sources of funding are available to lenders: financial markets and domestic deposits.
During the financial crisis, lenders found it very difficult and costly to borrow on financial markets as investors lost their appetite for risk. The banks were instead forced to tap local deposits to fund lending, using elevated interest rates on term deposits to lure consumers to save their cash.
As the chart below shows, the amount lenders had to offer on deposits over the cash rate increased dramatically from around 2007. Term deposit interest rates have fallen since mid-2012, but they are still high by historical comparisons. At-call savings account interest rates have remained above average.
<img src="/images/2014/04/01/zoe-april-1-one.jpg" alt="">
“Banks have shifted their funding base away from financial markets to domestic deposits. Banks have passed on a part of their increased funding costs to borrowers,” Johnson says.
Banks also consider credit risk associated with loans and the liquidity risk of funding long-term assets with short-term liabilities when setting interest rates, according to <a href="https://www.rba.gov.au/publications/bulletin/2014/mar/pdf/bu-0314-8.pdf" target="_blank">a report by the RBA</a>.
“Banks’ growth strategies, competitive pressures and the desire to provide a return to equity holders also affect banks’ lending rates,” the report noted.
“An important element in determining the overall cost of banks’ funding is the level of the cash rate, which acts as an anchor for the broader interest rate structure of the domestic financial system. Nevertheless, changes in the level of compensation demanded by investors to hold bank debt, competitive pressures and non-price factors can exert significant influences on banks’ funding costs.”
Johnson says the trend for lenders to charge a large premium over the cash rate will reverse as financial markets stabilise further and investors in financial instruments regain their appetite for risk.
House prices are rising and banks are well capitalised, easing investor concerns. Fund managers face a shortage of yield-producing assets. Under these conditions, and amid stabilising financial markets, demand will increase for yield-producing assets such as residential mortgage-backed securities (RMBS).
“That will again make securitisation [through RMBS] a viable funding strategy for the mortgage lenders,” Johnson says.
Non-bank lenders that lack the deposit-base of the big banks will be better able to compete as financial market funding costs fall, putting pressure on the banks to reduce their margins over the cash rate. 
But Johnson warns that might not lead to lower interest rates for consumers.
He says the wide margin between the RBA cash rate and mortgage rates is a big part of the story of why official interest rates are as low as they are now. The RBA has been compensating for the lenders’ higher costs, he says.
“If that [gap] goes back to 1%, then the official cash rate could rise,” Johnson says.
The RBA estimates in its report that even though funding costs have reduced over the past year, they are likely to remain close to 130 percentage points higher than they were before the global financial crisis.
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