Apartment buildings are increasingly being designed around how people actually live day to day, not just how they want a building to look.

For buyers, that shift is showing up in practical inclusions that respond to changing habits. Work-from-home spaces, EV charging, wellness amenities, secure bike storage and parcel management are becoming part of the broader apartment conversation, reflecting a move toward buildings that reduce friction in everyday life.

Online shopping has become one of the clearest examples of that change.

Australians spent a record $82.6 billion online in 2025, with nearly one in four retail dollars now spent online. That has made parcel delivery a regular part of apartment living, rather than an occasional inconvenience.

For apartment residents, however, the delivery process can be less straightforward than it is for detached homes. Parcels may be left in lobbies, redirected to Post Offices, missed entirely, or placed under the responsibility of building managers and concierge teams.

That is why secure parcel infrastructure is increasingly being considered alongside more familiar apartment amenities.

<iframe allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" allowfullscreen="" frameborder="0" height="315" referrerpolicy="strict-origin-when-cross-origin" src="https://www.youtube.com/embed/-VjjLwoViX0?si=A3k7ws9NX35Uac7_" title="YouTube video player" width="560"></iframe>

Australia Post Parcel Lockers offer one way to address the issue. When a parcel arrives, residents receive a notification through the AusPost app or SMS, then collect it using a QR code or one-time PIN. The parcel is kept secure, accessible and removed from common areas.

The broader Parcel Locker network now includes more than 1,500 locations across Australia, positioned at Post Offices, shopping centres, supermarkets, transport hubs and other accessible locations.

For new apartment projects, the relevance is clear. A building’s amenity offering is no longer only about lifestyle spaces, but also about convenience, security and functionality.

As buyer expectations evolve, secure parcel delivery is becoming part of the same design conversation as flexible working, sustainable transport and resident wellbeing.

It is one less thing for residents to worry about, and another example of apartment design adapting to the way Australians now live.

Joel Robinson

Apartment design is adapting to the way Australians shop

While school holidays and trips to Europe tend to define the winter property market, there's been no cold snap at <a href="https://www.apartments.com.au/new-apartments/the-walden-north-sydney-177-walker-street-north-sydney-nsw-2060">The Walden</a> in North Sydney.

Developer-builder&nbsp;<a href="https://www.apartments.com.au/developers/aland">ALAND</a> sold more than $35 million worth of apartments throughout June, including a $6.8 million apartment that now ranks among the highest apartment sales ever recorded in North Sydney.

SRM Residential agent Ben Stewart said buyer demand throughout June reflected a mix of improving market confidence and longer-term thinking from owner-occupiers.

"We're seeing strong demand from owner-occupiers who are taking a longer-term view," Stewart said.

"Many recognise the opportunity to secure an apartment in an iconic building and premium location while values remain attractive. They may initially lease the property, but the intention is to eventually move in themselves, rather than purchasing purely as an investment."

[smartcode_project:default project_id=134323 project_image_fid=367129]

Located at 177 Walker Street, The Walden will deliver 161 one, two, three and four-bedroom residences across a 30-storey tower designed by Rothelowman. Every apartment occupies a corner position, maximising natural light, cross ventilation and views across Sydney Harbour, the Opera House, Sydney Heads and the northern districts.

Rather than a traditional balcony, the residences feature winter gardens that seamlessly extend the open plan living areas, creating versatile spaces for relaxing or entertaining throughout the year. Floor-to-ceiling glazing draws in natural light while showcasing sweeping views from the building's elevated Walker Street position.

Every apartment features high-end Calacatta marble, bespoke joinery, and fully integrated appliances.

The larger residences have been planned with distinct entertaining and private zones, with many master suites positioned on corners to capture natural light and harbour views. Walk-in dressing rooms, freestanding baths and refined stone finishes reinforce the house-like feel that has resonated with downsizers and owner-occupiers.

[smartcode_project:default project_id=134323 project_image_fid=6393]

Rothelowman Principal Ben Pomroy said the project was designed to make the most of its unique position overlooking the harbour.

"The Walden is a celebration of all things beautiful, curated for those who expect nothing less than exceptional," Pomroy says.

"Meticulously designed entertaining spaces and light-filled living areas that capitalise on capturing the natural beauty of Sydney's iconic harbour."

Residents will also have exclusive access to The Pavilion, a dedicated amenity building featuring a rooftop pool, wellness studio, gymnasium, sauna, concierge service, residents' lounge, private dining spaces and work-from-home facilities.

[smartcode_project:default project_id=134323 project_image_fid=6402]

The project marks ALAND's first major luxury apartment development in Sydney's inner-city market after more than two decades delivering residential communities across Greater Sydney.

Founder and CEO Andrew Hrsto previously said the rarity of the Walker Street site made it an opportunity the company could not overlook.

"This is a rare opportunity to bring a truly exceptional project to life in one of Sydney's most iconic locations, and to showcase our craftsmanship and design expertise at a world-class level," Hrsto said.

[smartcode_project:default project_id=134323 project_image_fid=6383]

The Walden has been introduced to the market at a time when demand for living in North Sydney is at an all-time high. Billions of dollars have been invested in infrastructure, including the recently opened Victoria Cross Metro station, located just 300 metres from The Walden, providing residents with direct access to the Sydney CBD in just minutes.

Private investment has also transformed the area through the arrival of new retail and dining destinations, elevating the lifestyle offering in what was once considered primarily a commercial precinct rather than an aspirational residential address.

The Walden is currently under construction and is scheduled for completion in 2028.

[smartcode_project_cta:default project_id=134323]

ALAND records $35 million in sales in North Sydney as The Walden bucks quiet winter selling season

The long-awaited redevelopment of the former Eastlakes Shopping Centre site has reached a major milestone, with Conquest's plans for a new mixed-use precinct officially placed on public exhibition.

The State Significant Development Application would transform the 1.7-hectare site at <a href="https://www.apartments.com.au/new-apartments/19a-evans-avenue-eastlakes-nsw-2018">19A Evans Avenue</a> into one of Sydney's largest urban renewal projects, delivering 736 apartments above a new shopping centre anchored by Woolworths, alongside specialty retail, dining, commercial space and new public open spaces.

The public exhibition marks the next chapter for the project after <a href="https://www.apartments.com.au/developers/conquest">Conquest</a> acquired the stalled Stage Two development from Crown Group, who completed the first stage across the road prior to their voluntary liquidation.

<img alt="First look: Conquest unveils plans for 736-home Eastlakes Shopping Centre redevelopment" data-entity-type="file" data-entity-uuid="5fca22c5-d1ed-4e2c-8801-03f7df1eafc8" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/eastland%20podium.png?VersionId=uomwr41nF8CmLUZRDcu3mHQechlbxucS" />

&nbsp;

Designed by DKO Architecture, the proposal comprises four residential buildings ranging from 14 to 18 storeys above a two-level retail podium. The development would deliver 736 apartments, including 74 affordable homes, 215 Build-to-Rent apartments and 521 market residences. Provision has also been made for dual-key apartments, which could increase the total number of dwellings to 877.

At ground level, the shopping centre has been designed as the suburb's new meeting place, anchored by a full-line Woolworths and complemented by a curated mix of fresh food retailers, cafés, restaurants, health services and everyday convenience shopping. Generous pedestrian links and landscaped public spaces will connect the retail precinct through to Jack Mundey Reserve, creating a more walkable and connected neighbourhood.

Conquest CEO Michael Akkawi said the redevelopment was about far more than replacing a shopping centre.

"Eastlakes has been overlooked for too long, and this is the community’s moment. We are building a shopping centre and homes, a genuine heart for the suburb, and we genuinely want locals to help shape it."

"We enrich communities through the creation of homes, places, and experiences designed for life, built to last, and owner for generations. That starts with listening, so we warmly encourage everyone with a connection to Eastlakes to view the plans and share their thoughts."

<img alt="First look: Conquest unveils plans for 736-home Eastlakes Shopping Centre redevelopment" data-entity-type="file" data-entity-uuid="22f6fb20-54fb-4bd7-8a92-48fafdd00608" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/eastland.png?VersionId=cugp7s9hrMHGJJdYzkeAkrFoQgnF4GXf" />

DKO said the design had been shaped by the site's landscape setting and surrounding open space.

"Our vision for the site embraces its unique Bidjigal identity by blending the residential living with generous landscaping and a material palette inspired by the Bidjigal locality, and celebrating the panoramic views to Botany Bay and the wetlands reserves."

"Taking cues from Country, we seek to harmonise built form with the landscape and lightly touch the earth. By reconnecting, retaining and regenerating existing ecology, and weaving in natural elements, we can deepen our connection to Country."

The landscape strategy extends across the podium and rooftops, incorporating communal gardens, children's play areas, lawns, community gardens, family gathering spaces and extensive tree planting. New landscaped links will also strengthen the connection between the precinct and Jack Mundey Reserve, while publicly accessible open spaces have been integrated throughout the development.

The proposal builds on Conquest's broader placemaking strategy for the site. Through an ongoing partnership, local artist Joe Rashbrook has been appointed Urban Art Curator, working alongside young residents to transform the project's site hoardings into a public art gallery that allows the community to engage with the redevelopment before construction is complete.

Conquest has rapidly expanded its development pipeline since acquiring the Eastlakes site, with more than $6 billion worth of mixed-use projects now in planning across Sydney, including Stanmore, Castlecrag and Waterloo.

Conquest CEO Michael Akkawi said the redevelopment was about far more than replacing a shopping centre.

First look: ‘Far more than replacing a shopping centre’ as Conquest unveils 736-home Eastlakes redevelopment

Abadeen has lodged a State Significant Development Application (SSDA) for one of Mosman's largest apartment developments in recent years, seeking approval to transform the former Honeysuckle Garden and Midas site on Military Road into a 100-apartment mixed-use development.

The SSDA, lodged with investment partner Phoenix Property Investors, proposes around $230 million worth of new housing on the prominent <a href="https://www.apartments.com.au/new-apartments/494-516-military-road-mosman-nsw-2088">494-516 Military Road</a> site.

The proposal comes as Mosman Council continues to progress its recently endorsed Masterplan, which identifies the precinct for increased housing density while maintaining the suburb's established character.

Designed by DKO Architecture, the development would comprise 100 apartments above ground-floor retail, with a rooftop wellness precinct including a gym, sauna, entertaining areas and landscaped communal spaces.

Rather than pushing to the full 12-storey height identified in Council's Masterplan, the proposal ranges between five and nine storeys, stepping down towards Hale Road. A tenth level would accommodate resident amenities rather than additional apartments.

The project has been designed to appeal to a broad range of buyers, from first home buyers and young professionals through to families and local downsizers looking to remain on the Lower North Shore.

<img alt="Mosman" data-entity-type="file" data-entity-uuid="5dada03f-5b4c-43ba-ba62-2868add31440" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-27%20at%209.57.55%E2%80%AFAM.png?VersionId=7LBy0B.Jo8_iWAFJsClcV7Q3UnXrv49r" />

Abadeen Executive Chairman Justin Brown said the apartments had been designed as genuine long-term homes rather than investor-focused stock.

"The apartments have been designed as genuine long-term homes, with efficient floorplans that maximise usable living areas, generous storage, natural light and strong connections between indoor and outdoor spaces," Brown says."

"We've focused on creating homes for a broad range of buyers, from first home buyers and growing families through to downsizers who want to remain in Mosman."

The rooftop wellness offering forms a key part of the proposal, with residents set to have access to a gym, sauna, outdoor entertaining spaces, communal dining areas, landscaped gardens and a multi-use recreation court overlooking Sydney Harbour.

<img alt="Mosman" data-entity-type="file" data-entity-uuid="d37c2d6b-583a-4a0f-b7a9-9f46b893d2f4" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-27%20at%209.58.06%E2%80%AFAM.png?VersionId=FPoa5FCm2RtzjhAh2w5FTWJbV6GHfY8D" />

DKO drew heavily on the site's natural and cultural history, undertaking a Connecting with Country process with local Aboriginal Elders to inform the architectural and landscape design.

Senior Associate Matthew Ritchard said the design sought to create a building that responded to both the site's landscape and its cultural significance.

"The architectural language of the project is a deep expression of Connecting with Country, where the materiality and colour palette serve as a bridge between the site's geological history and its future as a residential sanctuary."

The proposal also retains the site's established blue gum tree as the centrepiece of the communal landscaped gardens, while introducing activated retail fronting Military Road to strengthen the connection between Mosman and Cremorne villages.

If approved, the project would deliver 100 new homes within walking distance of shops, public transport, schools and local amenities, adding to the limited pipeline of new apartments on the Lower North Shore.

<h2>Project Snapshot</h2>

Project: Honeysuckle Garden Redevelopment

Address: 494-516 Military Road, Mosman

Developer: Abadeen and Phoenix Property Investors

Architect: DKO Architecture

Lead Architect: Matthew Ritchard

Value: $230 million

Residences: 100 apartments

Key features:

<ul>
	<li>
	Ground-floor retail
	</li>
	<li>
	Rooftop wellness precinct
	</li>
	<li>
	Gym and sauna
	</li>
	<li>
	Outdoor entertaining and BBQ areas
	</li>
	<li>
	Landscaped communal gardens
	</li>
	<li>
	Multi-use recreation court
	</li>
	<li>
	Retained mature blue gum tree
	</li>
	<li>
	Connecting with Country design process
	</li>
	<li>
	Harbour, CBD and Balmoral views from upper-level apartments
	</li>
</ul>

Abadeen Executive Chairman Justin Brown said the apartments had been designed as genuine long-term homes rather than investor-focused stock

First look: Abadeen plans 100 apartments on former Honeysuckle Garden site in Mosman

The wave of apartment proposals sweeping through Mosman shows no signs of slowing, with another major residential development lodged through the NSW Government's State Significant Development pathway.

Developer First Quadrant Properties, which recently completed Willoughby Grounds and has several projects in planning across the North Shore, has unveiled plans for <a href="https://www.apartments.com.au/new-apartments/cove-on-ourimbah-40-56-ourimbah-road-mosman-nsw-2088">Cove on Ourimbah</a>, a 63-apartment development on Ourimbah Road, adding to the growing pipeline of projects reshaping one of Sydney's most tightly held harbour suburbs.

The proposal would consolidate nine properties at 40-56 Ourimbah Road into a part eight, part nine-storey apartment building, continuing the momentum created by the NSW Government's accelerated planning pathways that have seen several significant developments emerge across Mosman over the past 12 months.

Designed by Doroch Architects, the project would deliver 63 apartments, resident wellness facilities including a gym, pool and sauna, landscaped communal spaces and basement parking, while using recessed upper levels, generous setbacks and extensive planting to reduce the perceived scale of the building.

<img alt="First look: First Quadrant Properties eyes nine-storey Mosman apartment project under State Significant pathway" data-entity-type="file" data-entity-uuid="32ee68e4-141e-4a10-8f83-48e961a5e71e" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Ourimbah%20Road%2C%20Mosman%20a.png?VersionId=CUeILFc6APlwXPc.iplElbxHvREKwjig" />

Doroch Architects said the building had been designed to reinforce Mosman's established character.

"The building's aesthetic is grounded in the existing residential character of Ourimbah Road and the broader Mosman context," the architect noted in the planning documents submitted to the NSW Government.

The design adopts a contemporary material palette of natural stone, textured concrete and brown concave metal cladding, complemented by integrated planters and deep balconies. The podium incorporates softened curved concrete forms, while increased setbacks have been provided adjacent to the heritage-listed property at 60 Ourimbah Road to create a more sympathetic transition.

The site sits around 330 metres from Mosman Town Centre, placing it within the NSW Government's Low and Mid-Rise Housing policy area, where increased residential density is being encouraged close to shops, transport and services.

The proposal follows a string of major apartment projects lodged or declared State Significant in Mosman in recent months, including Abadeen's 100-apartment Honeysuckle Garden redevelopment on Military Road and several other developments across Awaba Street, Redan Street and Muston Street from the likes of Time &amp; Place, HELM and Prosker Property.

&nbsp;

Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/time-place-to-take-on-mosman-apartment-market">Time &amp; Place to take on Mosman apartment market</a>

Read more:&nbsp;<a href="https://www.apartments.com.au/news/qld/first-look-abadeen-plans-100-apartments-on-former-honeysuckle-garden-site-in-mosman">First look: Abadeen plans 100 apartments on former Honeysuckle Garden site in Mosman</a>

&nbsp;

First look: Another major apartment proposal signals Mosman's development boom

Investment Loans

<html><body>
<div>If it seemed that the big capital city housing markets were strengthening into Christmas then so it was, with a massive 4.9 percent jump in investment loans to a 17-month high of $13.3 billion, up 21.4 percent from a year ago in seasonally adjusted terms. </div>
<div> </div>
<div>It never pays to get too excited about month to month changes, but even with the ABS drilling its trend line through the figures it's clear than investors were resurgent. </div>
<a href="https://www.propertyobserver.com.au/images/2017/01/18/HF1.jpg" target="_blank">Click to enlarge</a>
<div class="separator"><img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/01/18/HF1.jpg" alt=""></div>
<div class="separator"> </div>
<div>Total housing finance increased by 2.2 percent in the month to a strong $32.7 billion.</div>
<div> </div>
<div>Ex-refinancing, the number of owner-occupier loans picked up in the month, but the real story is the huge flip back to investment loans. </div>
<a href="https://www.propertyobserver.com.au/images/2017/01/18/HF2.jpg" target="_blank">Click to enlarge</a>
<div class="separator"><img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/01/18/HF2.jpg" alt=""></div>
Average loan sizes are now clearly trending up again, having been knocked back by the first salvo of macroprudential measures to curb investor lending. 
<a href="https://www.propertyobserver.com.au/images/2017/01/18/HF4.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/01/18/HF4.jpg" alt="">
 
<div>In the owner-occupier markets, Melbourne and to some extent Queensland are seeing strong mortgage volumes for owner-occupiers. </div>
<div> </div>
<div><a href="https://www.propertyobserver.com.au/images/2017/01/18/HF3.jpg" target="_blank">Click to enlarge</a></div>
<div> </div>
<div class="separator"><img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/01/18/HF3.jpg" alt=""></div>
<div class="separator"> </div>
<div>The number of first homebuyer loans jumped from 7,302 to 8,281 in November in original terms, but overall it's a tough environment for first homebuyers in Sydney (which in part accounts for why so many are turning to investment property as a first purchase).  </div>
<a href="https://www.propertyobserver.com.au/images/2017/01/18/HF5.jpg" target="_blank">Click to enlarge</a>
<div class="separator"><img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/01/18/HF5.jpg" alt=""></div>
 The wrap - $1 trillion of home loans 
<div>Investment loans increased for the sixth time in seven months, and this one was a big leap, taking the year-on-year increase to above 21 per cent, the highest such percentage increase since the peak of the Sydney boom in Q2 2015. </div>
<div> </div>
<div>In part thanks to net loan reclassifications and some cases of 'switching' of loan purpose, the stock of outstanding investor loans increased by only 3 per cent over the year to November.</div>
<div> </div>
<div>Owner-occupier loans outstanding on the other hand surged by more than 9 per cent to pass $1 trillion.</div>
<div> </div>
<div class="separator"><a href="https://4.bp.blogspot.com/-g5-Tg33GHjs/WH31_I5OUZI/AAAAAAAAhRU/VCV8q8CCN5c4WJuXe286wL37ZzkAc-_yQCLcB/s1600/HF6.jpg"><img src="https://4.bp.blogspot.com/-g5-Tg33GHjs/WH31_I5OUZI/AAAAAAAAhRU/VCV8q8CCN5c4WJuXe286wL37ZzkAc-_yQCLcB/s640/HF6.jpg" width="640" height="356"></a></div>
<div> </div>
<div>Regardless of the blurred classification of outstanding credit, the key takeaway is that investors were pouring back into the market in late 2016, particularly in Sydney and Melbourne,</div>
<div> </div>
<div>I'll look as those investment loans in more detail and by state. </div>
<div> </div>
<div>PETE WARGENT is the co-founder of <a href="https://allenwargent.com/" target="_blank" rel="nofollow">AllenWargent</a> property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank" rel="nofollow">blogger</a>. </div>
</body></html>

pwargent-M4siyDbqQY

APRA shrugged? Investments loans up 21 percent: Pete Wargent

<html><body>
National Australia Bank have cut their three-year fixed investor interest only deals, making it the cheapest lender of the big four.
CBA have their rates at 4.29 percent, ANZ are at 4.49 percent and Westpac are the only one breaking the 4.5 percent barrier at 4.54 percent.
NAB were the last of the big four banks this month to announce it was moving a number of its fixed rate loans, with the other three making cuts earlier in March.
Some loans, such as the five-year fixed owner occupier principal and interest, has been by 50 basis points. It went from 4.59 percent to 4.09 percent.
Three-year, interest-only fixed deals for investors have dropped from 4.49 percent to 4.19 percent.
All the changes only apply to new fixed rates deals and not for existing borrowers.
A NAB spokeswoman said the changes was a result of the bank wanting “to help Australians achieve their property goals.”
The Reserve Bank of Australia board this week kept the cash rate on hold at 1.5 per cent.
AMP Capital's Shane Oliver, among other experts, believes there may not be another cash rate move until later this year or in 2019.
 
 
</body></html>

jonathanchancellor-7SQnKwU6yx

NAB cut investor interest only deals and outdo other big four 

<html><body>
GUEST OBSERVER
The real estate sector has been a key driver of China’s economic growth in recent years, helping to support the economy during the transition away from growth led by investment in heavy industry towards domestic consumption.
However, this growth has also built a sizeable debt burden which will have to be carefully managed in coming years to avoid a major downturn. 
This is the first of two parts looking into the real estate sector. This part provides a high level view of the importance of the sector and recent trends, while part two will look at the risks related to the sector going forward.
PROPERTY SECTOR A CORE COMPONENT OF CHINA’S ECONOMY
<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/2018/3/1/CORELOGIC%201.jpg" alt="">
Private ownership of real estate has a short history in China. Prior to the period of opening up that commenced in 1978, all property was state-owned. Two decades of gradual reforms saw the introduction of ‘commodity houses’ in 1998 – private properties that could be bought and sold at market prices. Chinese residents embraced home ownership – with surveys conducted by Peking University showing that around 90% of households own their home.
The property sector is a critical part of China’s economy, and has been a major driver of growth over the past decade. In 2017, the broad sector (accounting for construction and real estate services) comprised 13.2% of China’s economy – compared with 10.8% a decade earlier, highlighting above average growth over this period. The IMF estimates that when combined with upstream and downstream demand (including cement and steel, along with furniture, electronics and automobiles), real estate drives around a quarter of the Chinese economy.
Similarly, investment in real estate (as a share of GDP) rose sharply from the start of the century – peaking at almost 15% of GDP in 2014, before easing back to 13.3% in 2017. The residential sector accounts for over two-thirds of this total. The trend over this period was supported by the mass migration of Chinese residents from rural areas to cities, as well as a substantial improvement in the quality of housing for existing urban residents.
Property a major part of the economy 
<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/2018/3/1/CORELOGIC%202.jpg" alt="">
Real estate’s importance to the financial sector has also increased in recent years. Outstanding loans to real estate have rapidly increased over the past decade – from around RMB 4.8 trillion to over RMB 32 trillion in Q4 2017. This increase has outpaced lending growth to other sectors as well as the broader economy– with real estate lending (as a percentage of GDP) increasing from 18% a decade ago to around 39% at the end of last year. Although this share is not particularly high when compared with advanced economies – particularly Australia (where it is around 90% of GDP) and the United States – its rapid growth poses some concern.
The key contributor to the increase in real estate lending has been residential mortgages – with the mortgage share of total real estate lending rising to 74% in December 2017, up from 63% in December 2007. In addition, the property sector has lured funds from the shadow banking sector (although data on this sector is patchy at best). In Q3 2017, around 10% of funds from the trust sector (one component of shadow banking) were invested in real estate. 
Property loans have grown rapidly 
<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/2018/3/1/CORELOGIC%203.jpg" alt="">
Finally, the sector has been extremely important to government balance sheets – with land sales a major source of revenue for the often highly indebted local governments. In 2016, land sales accounted for almost 26% of the total – although this share varies widely across the country. Governments also benefit from tax revenue from the real estate sector – although at present there are no residential property taxes. The sector is also been a major employer – around 27 million people were employed in construction in 2016, with a further 4 million in real estate management, which together accounts for almost 18% of urban employment (and with it income tax revenue). 
Land sales still a major source of funding 
This implies that there are various bodies – both state and private – that benefit from continued growth in construction and property development, despite growing concerns around oversupply once again. This incentive to continue to expand increases risks around China’s economy. 
RECENT TRENDS IN PROPERTY 
China’s previous residential property cycle peaked in April 2014 – following a period of domestic and international concern around potential price bubbles and overbuilding (particularly in so-called ghost cities). Aggregate prices for 70 major cities fell over the next twelve months before the recovery commenced (led by the largest Tier 1 cities – Beijing, Shanghai, Shenzhen and Guangzhou).
During this period, there was a substantial slowdown in investment in the real estate sector – with the rate of growth down from around 15% yoy (on a three month moving average basis) to -0.6% yoy (3mma) by November 2015. This resulted in a drop in construction activity, with residential starts (measured in square metres of floor space) falling considerably between February 2014 and January 2016. These weaker conditions flowed through into the next link in the chain – local government revenues from land sales fell 24% in 2015 on weaker demand from developers. 
PROPERTY PRICES BY TIER - Vast disparities between China’s cities 
<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/2018/3/1/CORELOGIC%204.jpg" alt="">
However, investment in real estate recovered in 2016 – as easing property purchase restrictions allied to a credit boom, fiscal stimulus and poor performance in other asset classes supported a fresh surge in property demand and construction activity. Much of the attention was focussed on the extraordinary price increases in tier 1 cities – by September 2016, prices in these locations were 40% above their April 2014 peak – however these cities accounted for just 8% of real estate investment in 2016 (IMF). The majority of investment (59%) occurred in smaller tier 3 and 4 cities (where prices in December 2017 were only 4.0% above the previous peak), where concerns around oversupply have been higher.
This growth provided a major boost to China’s economy in 2016 – at a time where fears of a hard landing were elevated. In real terms, real estate and construction grew by 8.6% and 7.2% respectively in 2016, well above the rest of the economy. 
Growing fears around overheating property markets have seen a tightening in property policies since this time– including higher down payments, restrictions on finance and tighter eligibility for purchases – however these policies have varied across the country. Prices stabilised in tier 1 cities and growth slowed substantially in tier 2 ones. As a result, the strong growth in construction starts and property sales in the first half of 2017 slowed considerably in the second half.
CONCLUSIONS 
We anticipate the slowing trends generally exhibited across the property sector in late 2017 will extend into this year. Slowing sales and softer price trends should flow through into weaker construction activity – which would have downstream effects for steel and cement demand (along with Australian iron ore) and local government revenues (with land sales likely to fall as well). 
Gerard Burg is senior economist - Asia Group Economics at National Australia Bank.
</body></html>

j.ballantyne1990-6AQqhLzZaK

China's property sector slowing amid growing fears of overheated market: NAB's Gerard Burg

<html><body>
Heritage Bank, the nation's second largest mutual, will stop offering property investment loans amid fears it is close to the regulatory speed limit on lending growth set by APRA.
after recent attractive offers attracted a deluge of borrowers.
It follows the decision of CUA, the nation's largest mutual, to stop writing new loans for property investors because demand is so strong.
The combined lenders have about $17.5 billion of assets and account for about 1.5 per cent of the total property lending market.
Their withdrawal from the market highlights continued strength of buyer demand in Melbourne and Sydney at the beginning of peak Spring sales and the inherent disadvantage on smaller lenders of a blanket 10 per cent cap.
Major banks, which because of their size can write much more loans and comfortably remain within limits, are cutting rates, waiving fees and offering lucrative promotional packages.
It also means that other lenders offering investment loans will come under greater pressure to remain within the caps from borrowers chasing the best deals.
Heritage Bank said it will "temporarily stop" accepting new applications for investment loans to ensure it remains "comfortably" within Australian Prudential Regulation Authority limits.
Under the restraints, which are intended to cool demand and direct buyers away from riskier interest-only loans, investor lending growth must remain under 10 per cent and interest-only loans can only total 30 per cent of all loans in a quarter.
"Heritage has experienced a sharp increase in the proportion of investment lending in our new approvals," the bank said.
"That's the result both of our attractive pricing structure and the actions of competitors in the market place," it said.
In July, Heritage chief executive Peter Lock said investment lending was only 2 per cent of mortgage growth, well below the 10 per cent regulatory cap.
Mr Lock warned he did not want the bank to become "an open harbour" to borrowers declined by other lenders as it launched highly competitive one and three-year fixed rate investment mortgages.
In recent weeks it has attempted to correct the lending imbalance and increase principal and interest lending by increasing interest-only investment lending rates and imposing an 80 per cent loan-to-value cap on interest-only loans for investment lending.
"We need to manage our investment lending carefully, to ensure we stay within the caps APRA has placed on growth in investor and interest only lending," the bank said.
In addition, its Family Guarantee packages will from today only be on offer to owner-occupier borrowers.
The bank is also introducing loan-to-value pricing tiers for two of its home loan products.
It means borrowers with smaller deposits will pay higher interest rates to "account for the higher risk".
It will calculate the new rate on the total amount funded, which will include fees and charges.
Heritage is offering a discount variable rate of 3.97 per cent for owner occupiers with a deposit of at least 20 per cent.
A spokesman for CUA said it continues to monitor investment lending but has no immediate plans for their reintroduction.
It is offering investment loans to some established customers that meet borrowing criteria.
</body></html>

Investment Loans

Editor's Picks

Have something to contribute?

Developments

New apartments

New townhouses

News

Investment Loans

Editor's Picks

Receive the latest news stories to your inbox

Have something to contribute?

Developments

New apartments

New townhouses

News