<a href="https://www.apartments.com.au/developers/bridgewell-development">Bridgewell Capital</a> has lodged plans for a major mixed-use apartment development in the heart of Maroubra, seeking a significant uplift in height and density controls to deliver 120 apartments and a 120-place childcare centre near Maroubra Junction.

The State Significant Development application, filed through the NSW Government’s Housing Delivery Authority pathway, covers a 3,270 sqm amalgamated site at 251-257 Maroubra Road and 133-135 Garden Street. The proposal includes a concurrent rezoning that would increase the maximum building height from 12 metres to 35.6 metres and lift the floor space ratio to 4.02:1.

Designed by <a href="https://www.apartments.com.au/architects/bka-architecture">BKA Architecture</a>, the project would replace a mechanic’s workshop and several detached homes with a 10-storey residential building above four basement levels.

The scheme comprises 120 apartments, including 27 affordable housing units to be managed by a community housing provider for 15 years, alongside 203 basement car spaces and 92 bicycle spaces. A childcare centre occupying nearly 900 sqm of floor area would sit at ground level and be capable of accommodating 120 children and 22 staff.

<img alt="First look: Bridgewell plots 120 apartments and childcare centre in Maroubra town centre" data-entity-type="file" data-entity-uuid="038a0639-f9e4-4303-8fcc-d43e73fa480f" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Bridgewell%20pers.png?VersionId=eGBElxmNqJW.YF3JFYgHTnPgAstdyXR3" />

According to the Design Report, the project has been conceived as a “gateway proposal” that responds to Maroubra’s evolving urban character and its proximity to the town centre.

“Designed to complement the character of Maroubra’s town centre, this gateway proposal features a building scale that matches its surroundings,” the report stated.

“It integrates residential units above a ground-level childcare centre, fulfilling the strategic objectives of the Randwick City Council Masterplan.”

The apartment mix is weighted toward larger residences aimed at families and downsizers, reflecting changing demographics in the Randwick LGA and increasing demand for medium-density housing close to transport and amenity.

BKA Architecture said the proposal seeks to reinforce Maroubra Road as a civic spine while improving the pedestrian experience around the site through landscaping and upgraded public interfaces.

“The design capitalises on the following site opportunities: reinforcement of Maroubra Road as a civic spine, enhancement of pedestrian pathways and the public interface via new landscaping, and strong market demand for two and three-bedroom apartments to support families and down-sizers,” the Design Report noted.

<img alt="First look: Bridgewell plots 120 apartments and childcare centre in Maroubra town centre" data-entity-type="file" data-entity-uuid="ee509779-3c7e-4918-b03d-761c785459d0" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Bridgewell%20site.png?VersionId=eZC4Ruyn.C7O.Qwfr1SVeP5.ds1c5.66" />

The building has been designed with setbacks and articulation intended to transition between the commercial intensity of Maroubra Junction and the surrounding lower-scale residential neighbourhoods. Communal open space is proposed on level one, while upper-level apartments would secure views towards Port Botany, Maroubra Beach and Sydney’s eastern suburbs.

The development sits around 200 metres east of the Maroubra Junction intersection of Anzac Parade and Maroubra Road, within one of Randwick’s identified strategic centres. The site is close to Pacific Square Shopping Centre, major bus routes, schools, parks and future cycling infrastructure proposed under the Maroubra Junction Masterplan.

The Maroubra proposal aligns with broader NSW Government initiatives encouraging higher-density housing near established centres and transport corridors, particularly where affordable housing is incorporated.

Bridgewell is also working on a <a href="https://www.apartments.com.au/news/qld/goldfields-sets-the-stage-as-quartet-milton-launches">new 55-unit project in Killara</a>.

Joel Robinson

First look: Bridgewell plots 120 apartments and childcare centre in Maroubra town centre

National diversified developer <a href="https://www.apartments.com.au/developers/goldfields-group">Goldfields</a> has launched its latest Brisbane apartment project, <a href="https://www.apartments.com.au/new-apartments/quartet-milton-33-manning-street-milton-qld-4064">Quartet Milton</a>, marking its entry into the sought-after inner-city suburb just two kilometres from the CBD.

The circa $100 million development will rise 18 storeys and deliver 131 apartments, offering a mix of one, two-, and three-bedroom residences.

Ideally located on Manning Street, Quartet residents will be within 300 metres of Milton Station, 500 metres from the Milton Ferry Wharf, and a short walk to Milton Markets, the iconic Park Road, as well as a range of breweries and cafés.

[smartcode_project:default project_id=108736 project_image_fid=367993]

Designed by architecture firm <a href="https://www.apartments.com.au/architects/rothelowman">Rothelowman</a> and brought to life by <a href="https://www.apartments.com.au/architects/cera-stribley-architects">Cera Stribley</a>, the building features a simple, gridded façade paired with generous glazing to enhance views, maximise aspect, and capture both sunrises and sunsets from within the apartments and their generously sized balconies.

Residents will have access to a 1,000 sqm rooftop, curated to balance wellness and entertaining, in response to increasing demand for wellness-focused shared spaces.

"We've approached Quartet Milton as a complete lifestyle offering, not just apartments, but a place where the design, amenities, and location all work together in a meaningful way," says Goldfields Managing Director Lachlan Thompson.

"Buyers are looking for that sense of confidence, knowing the vision has been carefully thought through not just by us as developers, but by all our consultants appointed to bring this together, and that it will be delivered to the standard they expect."

[smartcode_project:default project_id=108736 project_image_fid=368000]

Cera Stribley Co-Founder and Managing Principal Domenic Cerantonio said the rooftop is designed to feel like a place "you'd genuinely use every day."

"A 25-metre pool framed by city and mountain views, wellness areas, and private dining spaces for evenings with friends create a setting designed for year-round comfort and effortless Brisbane living."

[smartcode_project:default project_id=108736 project_image_fid=367999]

In addition to the 25-metre pool, the rooftop will include a sauna, cold plunge, fully equipped gym, and zen gardens, all complemented by panoramic views of the city and river.

While the building is expected to appeal predominantly to owner-occupiers, Goldfields anticipates interest from investors seeking strong rental returns, driven by the project's design, location, and the city's projected capital growth in the lead-up to the 2032 Brisbane Olympics.

[smartcode_project:default project_id=108736 project_image_fid=367991]

<a href="https://www.apartments.com.au/developments/milton-qld-4064">Milton</a>, widely regarded as one of Brisbane's most desirable inner-ring suburbs due to its lifestyle offering and proximity to the CBD, has experienced a shortage of new apartment supply in recent years.

Goldfields is already active in the Brisbane residential market through its Ripley Valley masterplanned community, Hayfield. The 109-hectare neighbourhood is already home to more than 300 families and features a large community park.

Plans for the precinct include a 4 km running track, future schools, and retail and commercial amenities, all within a 35-minute drive of the Brisbane CBD.

Goldfields also plans to deliver a new mixed-use tower at 88 Robertson Street in Fortitude Valley, within the James Street precinct. The project will include 16,000 sqm of boutique commercial space, a level of wellness facilities, and a rooftop restaurant and event space, akin to Goldfields House in South Yarra, its flagship mixed-use development on Chapel Street, which is crowned by the Beverly Rooftop bar, one of Melbourne’s best-known venues.

[smartcode_project_cta:default project_id=108736]

Goldfields sets the stage as Quartet Milton launches

<a href="https://www.apartments.com.au/developers/stockland">Stockland</a> and Homes NSW have taken the next major step in the transformation of Waterloo Estate, lodging a Concept State Significant Development Application and concurrent rezoning proposal for the renewal of Waterloo South.

The proposal, now on public exhibition, outlines plans for around 3,300 new homes across the 12.3-hectare precinct. A minimum 30 per cent of residential gross floor area will be delivered as social housing, approximately 20 per cent as affordable housing, and a maximum 50 per cent as market housing. The redevelopment would more than quadruple the number of homes currently on the site and more than double the existing supply of social and affordable housing.

The renewal of Waterloo South forms the first stage of the broader Waterloo Estate transformation and is set to unfold over the next 10 to 15 years. The estate currently contains 750 social housing dwellings and 120 private homes.

<img alt="First look: Stockland and Homes NSW unveil plans for 3,300-home Waterloo South renewal" data-entity-type="file" data-entity-uuid="ba2da34b-171b-4ff1-b0c7-4baf0bce97f2" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Waterloo%20public.png?VersionId=S5apPKOqjPHJhk_SzCvdVPxsEBYs300o" />

The proposal, prepared by <a href="https://www.apartments.com.au/architects/sjb-architects">SJB</a> and Beam Planning, spans 10 street blocks bounded by Cope, Raglan, George, Wellington, Gibson, Kellick, Pitt and McEvoy Streets, directly adjoining the Waterloo Metro Station precinct and within walking distance of Redfern and Green Square stations.

Under the masterplan, building heights would range from two to 33 storeys, delivering approximately 282,485 sqm of residential floor space alongside at least 10,000 sqm of non-residential uses and a minimum 5,000 sqm of community space. The planning framework has been specifically structured to support the mixed-tenure outcome, with the residential gross floor area capped at a maximum 50 per cent market housing allocation.&nbsp;

The Urban Design Report describes the vision as creating “a unique and vibrant mixed-tenure housing precinct that supports the needs of the community and delivers much needed housing in response to National and State Government priorities.”&nbsp;

<img alt="First look: Stockland and Homes NSW unveil plans for 3,300-home Waterloo South renewal" data-entity-type="file" data-entity-uuid="6e1a6d8b-0626-4fa7-94fc-aa91c0af86dc" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/waterloo%20per.png?VersionId=duyiJTFOeezTNdM22leI3SoHuqnW6ZaY" />

A major focus of the revised proposal has been increasing the social and affordable housing component. The Minns Government increased the affordable and public housing allocation from 35 per cent to 50 per cent after coming to office in 2023.

Minister for Housing and Homelessness Rose Jackson said the changes were critical to maintaining Waterloo’s social diversity.

“When we came to government, we immediately reviewed the plans for the Waterloo renewal and boosted the number of public and affordable homes from 35 to 50 per cent,” Jackson said.

“This was a crucial step to ensure Waterloo remains a welcoming place for people from all walks of life to call home now and into the future.”&nbsp;

Minister for Planning and Public Spaces Paul Scully said the project would reshape the precinct for generations.

“This concept DA brings thousands of new public, affordable and market homes on the doorstep of the Waterloo Metro station another step closer to reality,” Scully said.

“Importantly, alongside the new homes the plan also proposes new open space where residents and the broader community can gather, relax and play.”&nbsp;

<img alt="First look: Stockland and Homes NSW unveil plans for 3,300-home Waterloo South renewal" data-entity-type="file" data-entity-uuid="867520cb-6e07-4204-885e-53793ac88066" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Waterloo%20public%20a.png?VersionId=lgSI85Q23xBLYLC9NcWKuWZY2HfP4zQ3" />

Stockland Managing Director and CEO Tarun Gupta said the project had been shaped around long-term liveability and community infrastructure.

“As delivery partner, Stockland is proud to be working with the NSW Government on the renewal of Waterloo South – a significant project with community at its heart,” Gupta said.&nbsp;

The planning documents place strong emphasis on “Designing with Country,” recognising the site’s location on Gadigal land. The masterplan incorporates new east-west pedestrian links, activated streetscapes, rooftop communal spaces, retail frontages, and landscaped public areas intended to improve permeability and community connection throughout the estate.&nbsp;

The proposal also seeks to establish a more flexible planning framework for future detailed SSDAs, including updated provisions for educational uses, creative industries, rooftop communal areas, and active frontages. A minimum seven per cent of residential floor space will be delivered as affordable housing managed in perpetuity by community housing provider City West Housing.&nbsp;

The Social Impact Assessment prepared by Urbis describes the renewal as one of Australia’s most significant public housing transformations, identifying substantial long-term positive impacts associated with housing supply, accessibility, public domain improvements, and community infrastructure.&nbsp;

Stockland and Homes NSW have already commenced the first stage of resident relocations, with some tenants moved into newly completed homes at Waterloo Metro Quarter and the Boronia development nearby.

First look: Stockland, NSW Gov, unveils plans for 3,300-home Waterloo South renewal

<a href="https://www.apartments.com.au/new-apartments/smith-by-valli-collingwood-224-228-smith-street-collingwood-vic-3066">Smith Collingwood</a> is a new boutique apartment development bringing a refined, design-led approach to one of Melbourne’s most established inner-city neighbourhoods.

Designed by <a href="https://www.apartments.com.au/architects/pandolfini-architects">Pandolfini Architects</a> with interiors by <a href="https://www.apartments.com.au/interior-designers/lisa-buxton-interiors">Lisa Buxton</a>, Smith by Valli sits on iconic Smith Street and comprises just 22 residences tailored toward owner-occupiers seeking a more considered style of apartment living.

[smartcode_project:default project_id=140747 project_image_fid=367540]

The design of Smith focuses on a north-facing orientation across all residences, a relatively uncommon feature in dense inner-Melbourne settings. Each apartment has been planned to maximise natural light and outlook, alongside a material palette defined by warm tones, custom joinery, and a full suite of Gaggenau appliances.

The development comprises a mix of one, two, and three-bedroom apartments, with pricing currently ranging from just under $1 million to around $4.85 million for the premium penthouse-level residences, reflecting growing demand for luxury owner-occupier product in Melbourne’s inner urban market.

Residents will also have access to a private rooftop garden designed as an elevated retreat above the city, &nbsp;featuring curated landscaping, veggie boxes, intimate seating areas and spaces for relaxed gatherings. Sustainability has also been integrated into the project through a 7-star energy rating and two secure bicycle facilities for every residence.

[smartcode_project:default project_id=140747 project_image_fid=367529]

Smith by Valli sits in the heart of one of Melbourne’s most established retail and hospitality strips, within walking distance of venues such as Falco Bakery, Carnation Canteen and Alimentari, alongside parks and everyday services. With a Walk Score of 99, the location reinforces the project’s positioning toward buyers prioritising walkability and access over car dependency.

With only a limited number of residences, Smith reflects growing demand for smaller, highly curated apartment developments that prioritise design quality, liveability, and connection to neighbourhood character.

[smartcode_project_cta:default project_id=140747]

Smith by Valli delivers design-led apartments to Melbourne’s inner north

<a href="https://www.urban.com.au/developers/far-east-consortium">Far East Consortium</a>’s 640 Bourke Street stands as a testament to&nbsp;<a href="https://www.urban.com.au/developments/melbourne-vic-3000">Melbourne</a>’s ability to bridge its storied past with a bold vision for the future.&nbsp;

Rising above the heritage-listed Eliza Tinsley building, the development reflects a broader shift toward adaptive reuse in the city, where historical assets are retained and reinterpreted as part of new residential development.

Designed by <a href="https://www.urban.com.au/architects/rothelowman">Rothelowman</a>, <a href="https://www.apartments.com.au/new-apartments/640-bourke-street-melbourne-640-bourke-street-melbourne-vic-3000">640 Bourke Street</a> incorporates the Eliza Tinsley building as its foundation, housing a grand gallery and lobby space that serve as both a functional and symbolic centrepiece. The heritage façade informs the tower’s design, creating a connection between Melbourne’s past and its contemporary skyline.

"It's a significant asset and wants to be celebrated and experienced by all residents every single time they go in and out of the building," Rothelowman Principal Stuart Marsland said.

[smartcode_project:default project_id=509 project_image_fid=365684]

Above this historic base, the 68-storey tower will deliver just over 600 residences, a notable reduction from earlier schemes, reflecting a deliberate move toward larger-format apartments and a stronger owner-occupier focus.

Unlike traditional CBD developments that prioritised investor stock, 640 Bourke Street has been repositioned to respond to changing buyer expectations.

"The discussion was all around making 640 Bourke Street the best residence to live in, to be much more focused on the people in the building rather than people looking at the building," Marsland explained.&nbsp;

This shift is evident in the development’s interiors, which emphasise practical luxury with spacious layouts, high ceilings, and floor-to-ceiling windows framing sweeping views of Melbourne and Port Phillip Bay.&nbsp;

“What it's meant for 640 Bourke is we've actually reduced the number of apartments. We've increased the overall size of the apartments. We don't have any studios in here, and what that does for a project is it elevates it," Lauren Sheldon, Far East Consortium’s Director of Sales and Marketing, said.&nbsp;

[smartcode_project:default project_id=509 project_image_fid=365687]

Rothelowman Associate Jun Chang added, "We were given the opportunity to be more generous. The apartments became bigger and squarer than any other apartments which had been designed in the CBD before that."&nbsp;

Amenities spanning more than 3,000 sqm across multiple levels further reinforce this focus on resident experience. These include a pool, gym, co-working areas, and a range of hospitality-inspired spaces such as a whisky lounge, library, and private dining rooms, many drawing reference from traditional bathhouses and Melbourne’s laneway culture.

"We wanted to make both the pool and the gym area to be absolutely destinational, and when you traverse across to these spaces, there is a gentle familiarity to the beautiful notions of the hammams and the Roman baths, a gentle nod to history," Chang noted.

At street level, the project contributes to the ongoing transformation of the western CBD, with upgrades to Langs Lane and the introduction of retail, hospitality, and gallery spaces designed to activate the precinct and strengthen its connection to the surrounding city fabric.

[smartcode_project:default project_id=509 project_image_fid=365689]

The location places residents within walking distance of Southern Cross Station, Flagstaff Gardens, Queen Victoria Market, and the Docklands waterfront, positioning the development within a rapidly evolving inner-city neighbourhood.

"We believe it's the best site left in the city of Melbourne," Craig Williams, Executive Director at Far East Consortium, said.&nbsp;

640 Bourke Street is Far East Consortium’s 14th building in Melbourne’s western CBD.

"A very elegant designed building. It's going to be a Melbourne statement for many, many years to come."

One-bedroom apartments are priced from around $640,000, with 640 Bourke Street targeting completion in 2029.

Renders shown are Artist's Impressions correct as of May 2026.

[smartcode_project_cta:default project_id=509]

Heritage-led design anchors Far East Consortium’s 640 Bourke St, Melbourne

Loans

<html><body>
Philip Lowe, the RBA Governor, has indicated the central bank's primary concern is employment, and those who don’t have a job and whose wages aren’t growing at sufficiently high rates. 

"So to the extent that anything keeps me awake at night, that’s what worries me is the social and economic cost from a protracted period of unemployment. 

"We know that low interest rates do push up asset prices, that’s part of the transmission mechanism. 

"What would concern me, if we saw on the back of these rising asset prices, lending standards deteriorate and people go into the bank and borrowing ridiculous amounts of money in a speculative boom. 

[smartcode_project:default project_id=29660]

"So this is why our focus is very much on making sure these lending standards remain sound because that would be a big problem if we saw a debt financed speculative boom in asset prices. 

"We are not seeing that at the moment. 

"The equity market is below its previous peaks, housing prices in Sydney and Melbourne, while they’re rising, they’re not really higher than they got to a little while back in some of the smaller capital cities. 

[smartcode_project:default project_id=4939]

"In regional Australia housing prices are rising quickly, but there are fundamental factors at work here. 

"So the issue is if prices are rising, are people borrowing responsibly and carefully? 

"And to date they are," Philip Lowe concluded.

Lowe also warned that looser lending standards would increase the upward pressure on house prices and create financial risks.

“We are not at this point, but we are watching carefully,” he said.
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The RBA Governor Philip Lowe has said he would be worried if Australians started “borrowing ridiculous amounts of money” in a speculative way.



jchancellor

Don't borrow ridiculous amounts of money: RBA Governor's warning to home buyers

<html><body>Non-bank funders are looking to lend to apartment developers whose project starts were stalled across Melbourne during the pandemic.

"We are seeing the savvy developers doing what they can now to get their projects moving," Wingate managing director (property) Mark Harrison told Nine Entertainment.

But Harrison confirmed "a real distinction" between investor and owner-occupied product.

"The owner-occupier market is quite strong and we are funding quite a bit through the middle and inner-ring suburbs, driven by downsizers and people making lifestyle choices."

The big banks are mostly absent from the market, given their policies on pre-sales.

Pallas Capital chief investment officer Dan Gallen noted the banks often still had a requirement for onerously high levels of pre-sales.

"The banks have not moved with the times," Mr Gallen said.

"Developers are left in purgatory," he added.

Pallas Capital has extended $700 million of apartments across the major capital cities over the last three years, mostly via first mortgages, targeting upmarket developments in suburbs Malvern and Brighton in Melbourne.

"The market is certainly there, especially in the owner-occupier space," Mr Gallen said.

"We have had $150 million of loans repaid in the last three months from developers able to sell product."

The article noted MaxCap Group founder Brae Sokolski indicating its client developers were taking a position on the demand picture in 2022 and 2023.

"If net migration returns, we feel there will be a chronic housing shortage that will work in favour of developers with completed projects."

Sokolski noted funding conditions were especially working in favour of inner-city boutique developments, led by owner-occupiers.

MaxCap is backing the $45 million One Wilson Avenue project in Brunswick, consisting of 41 apartments being developed by Neometro and Milieu.</body></html>

Pallas Capital has had $150 million of loans repaid in the last three months from developers able to sell apartments

Non-bank lenders triggering apartment project restarts across Melbourne

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<div>APRA's crackdown has skimmed skimmed the high LVR property investors out of the market, but there still exists a relatively high level of demand for investor credit from those with the requisite serviceability that remain. </div>
<div> </div>
<div>The ABS Lending Finance data series for February 2016 showed total lending finance across all measured sectors rebounding nicely in February, but against an underlying downtrend.</div>
<div> </div>
<div>That's in part due to the APRA effect, which has effectively stymied the outlandish surge in property investment demand. </div>
<a href="/images/2016/04/19/B4.jpg" target="_blank">Click to enlarge</a> <img src="/images/2016/04/19/B4.jpg" alt="">
 
<div>Breaking out the data into its component parts and using the smoother trend figures we can see that despite a solid rebound in February commercial lending has apparently lost some of its momentum, which is potentially underwhelming news for business. Of course, from month to month the underlying business lending figures are lumpy, and there's no getting away from that.  But for the moment, at least, the trend appears to be softening.</div>
<div> </div>
<div><a href="/images/2016/04/19/B5.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/04/19/B5.jpg" alt=""></div>
 
<div>The figures for personal finance at first blush appear to be almost comically soft, declining to levels last seen in 2007.  However, I do wonder about classification issues here, given the massive and increasing popularity of mortgage buffers, offset accounts, and redraw facilities. Not really sure about this, but it looks muchos weird to me. Let's pass on that one, Magnus!  At the state level, commercial finance in rolling annual terms has been trending up marginally in Queensland, but down in Western Australia. However, the latest figures suggest that WA may have at least arrested its decline.</div>
 <a href="/images/2016/04/19/B6.jpg" target="_blank">Click to enlarge</a> <img src="/images/2016/04/19/B6.jpg" alt="">
<div>Splitting out the commercial finance data by industry it is with no great surprise that we discover with that lending in the mining sector has been obliterated by about a third over the past year to be around 40 per cent below its peak.</div>
<div> </div>
<div><a href="/images/2016/04/19/B3.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/04/19/B3.jpg" alt=""></div>
 
<div>Fortunately mining is only one part of Australian industry, and other sectors have fared considerably better, with business lending rates tracking at record lows.</div>
 Property investment loans 
<div>Macroprudential tools have been deployed in order to cap property investor credit growth at 10 per cent, while the RBA disclosed some of its <a href="https://www.rba.gov.au/information/foi/disclosure-log/pdf/141515.pdf" target="_blank">thought processes</a> in this regard this week - interesting insights indeed (imagine having your emails disclosed like that in the public domain, by the way!).</div>
<div> </div>
<div>These moves have had the desired effect, and the focus has very much shifted towards owner-occupier lending. </div>
<div> </div>
<div>That said the seasonally adjusted February Housing Finance data showed investment loans rebounding by +4.1 per cent in February to $11.9 billion, so there is still a reasonably high volume of investor activity in the post. </div>
<div> </div>
<div>Indeed, investor loans are steadying across most states in February when looked at in rolling annual terms.  That said, activity in Western Australia was down by 20 per cent in February from the prior year comparative result, so there is possibly still some decline to come there, although a few analysts have already called the market bottom for Perth. </div>
<a href="/images/2016/04/19/B1.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/04/19/B1.jpg" alt="">
 
<div>Investor activity in the Northern Territory has fallen to such a low level at about $46 million per month that it wouldn't even register as a blip on the above chart. The February result was down by 43 percent from one year ago, so the trend line is shaping as if participating in a race to the bottom.</div>
<a href="/images/2016/04/19/B2.jpg" target="_blank"> Click to enlarge</a>
<img src="/images/2016/04/19/B2.jpg" alt="">
 Not looking all that grand for Darwin, tbh!
<div>
 The wrap
</div>
<div> </div>
<div>A decent rebound for Lending Finance in February, but there looks to be a softening tending in business finance. </div>
<div> </div>
<div>Monthly investor lending activity looks to be steadying in New South Wales ($4 billion), Victoria ($2.6 billion), and Queensland ($1.5 billion), though there is still some potential softness in evidence elsewhere. With some banks having offered fixed rate home loans as low as 3.99 per cent, anecdotally there was a strong month of owner-occupier lending in March.</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>. 
His latest book is <a href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx" target="_blank" rel="nofollow">Four Green Houses and a Red Hotel</a>.
</div>
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pwargent-M4siyDbqQY

Property investment loans already bottoming out: Pete Wargent

<html><body><div class="page" title="Page 1">
<div class="section">
GUEST OBSERVER
The March housing finance approvals came in largely in line with expectations, with essentially steady owner occupier activity and a slight firming in the value of investor loans.
The number of owner occupier finance approvals dipped 0.9 percent mth in line with Westpac’s –1 percent call. Ex refi, the number of ‘new loans’ was a bit softer, down 1.6 percent mth.
Note that the abrupt slowdown in Australia’s housing markets in the second half of last year was mainly driven by a rapid cooling in investor activity following a tightening in credit conditions and rates for investor loans in response to a tightening in prudential guidelines and increased capital targets from regulators. Owner occupier activity was a lot steadier through this period with the number of loans still growth in annual terms, up 3.8 percent yr.
Accordingly there continues to be more focus on the investor lending numbers in the finance approvals data. Although these are not included in the headline figure on the number of approvals, the value of investor loans is recorded and included in estimates of the 'total value' of housing loans. For March the value of investor loans was up 1.5 percent mth after a 3.1 percent gain in February.
Though still down 13 percent yr, investor activity has clearly firmed a touch in early 2016. This may account for the firmer tone in other housing market indicators such as auction clearance rates and price growth. Buyer sentiment lifted following the RBA's rate cut in May but remains at a subdued level compared to previous years. Notably, the pick up in price growth in April appears to have accelerated in May with the month to date figures from CoreLogic RP Data showing surprisingly strong gains.
Elsewhere in the finance approvals detail, construction-related finance approvals were again weak, down 5.9 percent mth and 11.7 percent over the last 3mths. Within this segment, finance approvals for the purchase of newly built dwellings, which covers owner occupier purchases of 'off the plan' units, are down 11.1 percent mth and 23 percent since Dec. Although this could reflect shifts in demand it may also be an indication that buyers of 'off the plan' units more broadly are starting to encounter financing difficulties.
Approvals were a mixed bag by state. Owner occupier approvals ex refi were down across the board but showed slightly bigger falls in NSW (–2.2 percent), Vic (–2.7 percent) and Qld (–2.5 percent). Note that only owner occupier state figures are available at this stage with investor data due out May 13.
Matthew Hassan is senior economist with <a href="https://www.westpac.com.au/" target="_blank">Westpac</a>.
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Australian housing finance March 2016: Matthew Hassan

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GUEST OBSERVER
The Macquarie dictionary explains collateral as, “Security pledged for the payment of a loan” and to cross-collateralise is to pledge multiple securities for the payment of a loan or loans.
An Example :
1. Property A is owned by Person A
2. Person A wishes to buy Property B but has no money for deposit.
3. Person A buys Property B with 100 percent loan and the Bank holds Property A and Property B as security against loan for Property B. Property A &amp; B are said to be cross-collateralised.
In 95 percent of cases cross-collateralising is not beneficial to the borrower, it favours the bank, cross-collateralisation isn’t a problem until it becomes a problem, and then untangling it can be a long, expensive and traumatising experience. People loose fortunes both in real time, money and opportunities as a result of cross-collateralised structures.
Ten disadvantages of Cross-Collateralising your property portfolio…
#1. When you sell a property in a cross-collateralised structure you may not see any of the funds as the bank may request some or all of it to go back in against the existing loans to strengthen their position. They don’t need your permission either. Picture this you’re releasing one of your properties for an opportunity or worse still a bind, and the bank deducts funds to strengthen their position. Where would that leave you? I have seen this happen to some very asset strong and successful property investors. Answer given, Bank Policy!
#2. When you sell a property you have to resign all of the existing mortgages. Extra unnecessary paperwork.
#3. You can loose product selection and control by being with just the one bank. For example the bank can say no more interest only loans for you, we want you to take a Principle and Interest loan from now on, to reduce your debt with us. This is quite common when your borrowing levels get up with the one funder. 
#4. Bank holds far more security than often necessary, for example Property A worth $800 000 is used to buy property B for $250000. The bank has $1 050 000 of assets against $250k of loans. The result is that the bank holds all of your cards.
#5. Buying across state boarders you are subject to mortgage document stamp duty of that state, this in itself is OK, but when you have other properties as security for the purchase, regardless of the state they are in you may have to pay the mortgage document stamp duty on the entire loan amount, rather than just on your purchase price. For example, purchase property A worth $300,000 in QLD but for whatever reason you have offered another property as security and it is worth $500,000 in the ACT, you would have to pay mortgage document stamp duty on the whole portfolio of $800,000 and this is because the entire mortgage document has to be stamped in QLD. 
This duty is a state duty and is different in every state or territory. An example of the difference in the amount payable can be, where the stamp duty is $4 in a thousand, for the cross-collateralised mortgage document stamp duty you are up for approximately $3,200, but if you had your purchase as a ‘stand alone’ loan you will have to pay approximately $1,200 . If you need to find out more about this point, please give us a call.
#6. Having at least two lenders gives you the flexibility of playing one off against the other, giving you more choice an ultimately more control.
#7. If you want to realise some increased equity when properties have grown in value you need to have your whole portfolio revalued (multiple valuations instead of one, again an additional and unnecessary cost).
#8. You can run out of borrowing capacity with one lender when you reach their maximum serviceability / exposure levels.
#9. It is so much harder to move banks, if you no longer like or agree with their service or lack of. 
#10. If you have cashflow problems, your whole portfolio is at risk. Better risk management from your respect is to not cross.
There are numerous more reasons why not to cross-collateralise, especially if you have a business with Overdrafts / partners / Fixed and Floating Charges etc, there are also simple ways to combat the banks having too much security with financial instruments like Deposits under Lien and secondary funders. An experienced Mortgage/Finance broker can help you with structuring advice specific to your own needs, and keep you in control of your assets.
 
Peter Tersteeg is mortgage broker, Sage Lending Solutions and can be <a href="https://www.sagelending.com.au" target="_blank">contacted here</a>.
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Property 101: Cross-collateral loans

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In making serviceability assessments of borrowers, most ADIs currently use a methodology in which they calculate the borrower’s Net Income Surplus (NIS).
Computing NIS is a multi-faceted calculation, with a number of different inputs, and for which the relative importance of each input is not always clear.
Assessing the relative prudence of NIS assessments across ADIs can therefore be problematic, as it can be difficult to determine the extent to which one conservative assumption outweighs another less- conservative assumption, and apparent minor differences in methodology can sometimes have a significant impact on the overall outcome.
To assess and compare lending standards across ADIs, one technique used by APRA has been a Hypothetical Borrower Exercise (HBE).
In early 2015, APRA asked a number of the larger ADIs to provide their serviceability assessments for four hypothetical mortgage borrowers — two owner-occupiers and two investors — using their policies in place as at 31 December 2014. This allowed APRA to compare the lending decisions of ADIs based on identical borrower characteristics. Importantly, it also allowed APRA to disassemble assessments into their component parts. In May 2015, APRA outlined some results and conclusions from the first HBE.<a href="https://www.apra.gov.au/Insight/Pages/insight-issue1-2016#mortgagefn1"> </a>
To test how lending policies had changed in response to APRA’s scrutiny, APRA ran a second HBE in late 2015, based on the policies ADIs had in place as at 30 September 2015. By asking the same population of ADIs to assess the same four hypothetical borrowers, not only could APRA compare across ADIs, it could also compare the same ADI at two different points in time.
The four charts below relate to the four calculation components for one of the hypothetical borrowers — in this case, a ‘typical’ investor. The blue bars show the results for December 2014, while the red dots show the September 2015 results for the same lender. Each chart is sorted with the most conservative lender for that particular component (as at September 2015) on the left, and the least conservative on the right.
<div id="chart" class="resize">
<h4>Chart A - Income recognised (less tax and haircuts)</h4>
Percentage of gross pre-tax income
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<div class="resize"><a href="/images/2016/03/23/2016-insight-issue1-mort-chart1.gif" target="_blank">Click to enlarge</a></div>
<div class="resize"><img src="/images/2016/03/23/2016-insight-issue1-mort-chart1.gif" alt=""></div>
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<div class="resize">Bars represent individual lender data </div>
<div id="chart">
<h4>Chart B - Minimum living expense assumptions</h4>
Percentage of borrower pre-tax salary income 
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<div><a href="/images/2016/03/23/2016-insight-issue1-mort-chart2.gif" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/03/23/2016-insight-issue1-mort-chart2.gif" alt=""></div>
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<div>Bars represent individual lender data</div>
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<h4>Chart C - New mortgage</h4>
Interest rate used in serviceability assessment
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<div><a href="/images/2016/03/23/2016-insight-issue1-mort-chart3.gif" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/03/23/2016-insight-issue1-mort-chart3.gif" alt=""></div>
<div>Bars represent individual lender data (Click to enlarge image)</div>
<div id="chart">
<h4>Chart D - Existing mortgage</h4>
Interest rate used in serviceability assessment
<a href="/images/2016/03/23/2016-insight-issue1-mort-chart4.gif" target="_blank">Click to enlarge</a>
<img src="/images/2016/03/23/2016-insight-issue1-mort-chart4.gif" alt="">
Bars represent individual lender data The current interest rate on the existing mortgage debt is 5.2%
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<div class="clr"> </div>
Chart A shows income recognised, as a percentage of gross pre-tax income.  While the assessment of PAYG salary income has usually remained the same between the two periods, a number of lenders have applied larger haircuts (i.e. discounts) to less stable sources of income such as overtime, bonuses, commissions, investment dividends and rental income.
Chart B shows minimum living expense assumptions as a percentage of pre-tax salary income.  Some lenders have made quite large changes to this component of their NIS assessment.  This impact has typically arisen from two main sources:
<ul>
<li>considering borrower-declared expenses where these are greater than calculated benchmarks; and/or</li>
<li>scaling living expense assumptions in line with income.</li>
</ul>
Chart C shows the interest rate used in the serviceability assessment for this new mortgage. Various lenders have increased that rate in response to APRA’s December 2014 letter, in which APRA stated that prudent serviceability policies should incorporate a ‘serviceability buffer of at least 2 percent above the loan product rate, with a minimum floor assessment rate of 7 percent.
Chart D shows the interest rate used in the serviceability assessment for an existing mortgage commitment. Here, the changes are even more dramatic than for Chart C, as at the time of the first HBE a number of ADIs were not using any serviceability buffer on existing debt.
These four components combine to calculate NIS. Whilst there was little overall change in NIS for the lenders that were already relatively conservative in December 2014, lenders that were the least conservative in December 2014 generally reported a significant drop in calculated NIS using their September 2015 policies. These changes had the effect of tightening the spread of calculated NIS from the most to the least conservative ADI. Overall, the maximum loan sizes reported by ADIs for the four hypothetical borrowers declined by, on average, around 12 per cent for investors and 6 per cent for owner-occupiers. (Note that this does not imply actual loan sizes are falling across the board; indeed the average size of loans continues to rise.)  
<h3>Conclusion</h3>
APRA’s HBEs have proven a simple but effective tool for examining the impact of changes to residential mortgage lending policies during 2015.  
Overall, debt serviceability assessments now appear to be both more prudent and more consistent across ADIs, relative to December 2014.  APRA will continue to engage ADIs on this issue in 2016 to assess whether the observed improvements in sound underwriting practices are maintained. APRA will also be examining the extent to which loans are able to be approved outside an ADI’s own (tightened) policy parameters.
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Property 101: APRA's loan serviceability methodologies 

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In an interesting take on APRA’s directives, the banks are pricing investment loans to be more expensive than ’owner-occupied’ home loans, for new and existing home loans.
There may be some contention as to what category your loan falls under. Did you borrow against your home to invest ? How about if only 50% of your loan relates to an investment property? What if your home and your investment property were cross-collateralised?
With this interest rate disparity, it’s ever more important to get your lending structure spot-on. Tailored advice is now paramount given there are ways to ensure you are getting the best rate available.  
For starters, having your home loan and investment loan at the same bank is now necessary unless you want to get slugged on the carded rate.
If you took out an investment loan to buy a property, which you have since moved into as your home, your broker should have been in touch with you by now regarding the suitability of asking the bank to re-classify your loan. Should it be appropriate, I reckon do it now before the mad rush in a couple of weeks. We have done our homework in advance - each bank will deal with this request differently.
So here are the new Standard Variable Rates. There’s not much difference in movement amongst the majors (not that I’m suggesting any opportunistic collusion). Hey, at least we can all be thankful that we all own part of the banks through our superfunds...
ANZ (Owner Occd): 5.38% (CR 5.49%)*
ANZ (Investment): 5.75% (CR 5.49%)*
CBA (Owner Occd): 5.45% (CR 5.59%)*
CBA (Investment): 5.86% (CR 5.86%)*
NAB (Owner Occd): 5.43% (CR 5.52%)*
NAB (Investment): 5.72% (CR 5.63%)*
WBC (Owner Occd): 5.48% (CR 5.62%)*
WBC (Investment): 5.89% (CR 5.89%)*
 * CR is the Comparison Rate. It is a notional rate which includes fees (mainly the annual package fee of around $395) into the interest rate in well-intentioned yet child-like attempt to come up with a single rate which punters can use to estimate the true cost of a loan. It is based on a $150,000 mortgage and hence does not at all relate to you unless your mortgage is exactly $150,000 and you never use your offset account or Credit Card interest free terms
The Standard Variable Rates are of course lacking meaning without applying your lifetime discount. One bank might be giving you a 1% discount off this headline rate (that discount is so 2011), whilst a broker may negotiate an unpublished cracking lifetime discount of 1.45%. 
You must always consider the upfront costs, ongoing fees and the ’after discount’ interest rate; then compare the loan products over a certain time frame (please don’t compare over 30 years, perhaps this is unrealistic). 
We think a 10-year projection is appropriate, that way it’s also easy to divide by 10 to see the annual $ saving.
Product Comparison – 10 Year Projection 
<a href="/images/2015/08/14/Screen%20Shot%202015-08-14%20at%204.52.53%20PM.png" target="_blank">Click to enlarge</a>
<img src="/images/2015/08/14/Screen%20Shot%202015-08-14%20at%204.52.53%20PM.png" alt="">
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 Jason Khoury is the principal at iChoice. He can be contacted <a href="mailto:jason@ichoice.com.au" target="_blank">here</a>.
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An interesting take on APRA’s directives: Jason Khoury

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The National Australia Bank will be raising variable mortgage rates on interest-only loans by 29 basis points.
NAB follows rivals ANZ and Commonwealth Bank of Australia in raising variable rates on loans for property bought for investment purposes by 27 basis points last week.
It will also apply to owner occupiers with interest only loans with NAB's rate increase adding about $70 to the monthly cost of a $300,000 interest-only mortgage.
Sources told Fairfax Media that NAB is constrained from charging different rates to investors and owner-occupiers because of technical problems. 
NAB advised that interest only loans are the predominate structure for investors, and over the last three years housing investment loans had grown 34 per cent, while the number of interest only loans has risen 44 per cent.
The Australian Prudential Regulatory Authority (APRA) has asked banks to keep annual growth in investment home loans to below 10 percent in an attempt to cool red-hot property prices in Sydney and Melbourne.
NAB's interest-only rate changes will be effective August 10 for all new loans, while the change for existing interest only variable rate loans effective September 10.
Matt Comyn, group executive for CBA retail banking services says increasing rates was unavoidable to ensure the major bank remains within APRA’s 10% growth guideline.  “As Australia’s largest home lender, we support the prudential regulator’s actions to ensure lending practices remain sustainable and we have been actively managing our investment home loan portfolio to remain below the 10% growth limit," he said.
Matt Comryn says the new investment home loan variable rate of 5.72% was still 0.18% lower than the rate six months ago. 
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NAB joins ANZ and CBA in higher interest rates for investors

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AFG, Australia’s largest mortgage broker, has reported investment loans moderated in NSW from 49.8% in May to 41.6% in June. 
Investment loans had been running at an average of 49.5% of all loans in NSW for the previous 12 months.
Elsewhere in Australia, the same moderating trend was repeated, with investment loans declining in SA from 41.8% to 36.8%, in QLD from 36.1% to 34.1%, in VIC from 36.5% to 35.7% and in WA from 31.8% to 31.2%.
Brett McKeon, AFG managing director suggested the figures indicated that APRA controls are starting to take effect, but not at the expense of the overall mortgage market.
"If this trend continues, it should help allay concerns about overheating in Sydney, in particular, as investment levels there come back into line with the sustainable, long term, national average.”
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