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.

Joel Robinson

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

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

Maréa Residences brings parkside apartments to Coolangatta

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

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

Local developer Harridan is seeking to turn its Woolloongabba apartment project into the first stage of a broader transformation of Burke Street, using a new 16-storey mixed-use building to establish a greener pedestrian connection toward the rapidly evolving Boggo Road transport and knowledge precinct.

The South East Queensland developer has filed plans for 154 apartments on the <a href="https://www.apartments.com.au/new-apartments/4-burke-street-woolloongabba-qld-4102">southern side of Burke Street</a>, where its proposal has been designed alongside a wider vision by LatStudios for the street.

That vision positions the southern side of Burke Street for buildings of 15 storeys and above, while envisaging lower-rise development of up to five storeys on the northern side to transition into Woolloongabba's existing character housing. It also proposes wider pedestrian verges, deep planting, new street trees and upgrades to the pedestrian approach to Boggo Road Station.

The Harridan development itself has been designed by Brisbane-based Arqus Design and will comprise 154 apartments across 16 storeys. The mix is weighted heavily toward two-bedroom apartments, with 121 proposed alongside 10 one-bedroom and 23 three-bedroom residences. There will typically be around 14 units per floor.

A lower-ground car park and three podium levels will accommodate 156 resident parking spaces, along with visitor and commercial parking. There will also be 154 resident bicycle spaces and 40 visitor bicycle parks.

&nbsp;

Harridan is a family-owned developer and part of the Holmwood Highgate Group, with more than three decades of development activity across South East Queensland. Its portfolio spans residential, commercial and industrial property, with current residential projects including Riverbank on Byron in Bulimba, Esperance Residences in Carina and The Precinct at Kinross Road in Thornlands.

Wooloongabba has been popular for apartment developers, particularly since the announcement of the 2032 Summer Olympics games in Brisbane.

While there have been a lot of development applications, it has failed to materialize into real supply.&nbsp;

Sarazin has been the major player in the area. They are under construction at Murcia Residences, on the fringe of East Brisbane and Woolloongabba. They have just launched <a href="https://www.apartments.com.au/new-apartments/the-stanley-residences-woolloongabba-8-trafalgar-street-woolloongabba-qld-4102">The Stanley Residences</a>, in Woolloongabba on Trafalagar Street. They also have Nuage coming soon on the nearby <a href="https://www.apartments.com.au/new-apartments/nuage-woolloongabba-14-wellington-road-woolloongabba-qld-4102">Wellington Road</a>.

First look: Harridan plans Burke Street transformation beside Boggo Road transport hub

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NAB has caved to funding pressures and hiked home loan rates just months after they said they were keeping their variables rates on hold.
NAB chief Andrew Thorburn said on September 10, “we are listening and acting differently”.
“We need to rebuild the trust of our customers, and by holding our NAB standard variable rate longer, we help our customers for longer,” Mr Thorburn he stated.
NAB is lifting rates by 0.12 per cent for owner occupiers paying principal and interest, and 0.16 per cent for investors and interest only customers, effective 31 January 2019.
The average NAB customer on a discounted variable rate will now pay $25 extra per month, almost $300 annually.
<img src="https://www.urban.com.au/images/2019/1/24/NAB%20rate%20hikes%202.JPG" alt="">
(Source: RateCity.com.au)
RateCity.com.au research director Sally Tindall said, “NAB tried to put their customers first, but it appears profit has won out in the end."
“NAB’s previous decision to keep rates on hold was designed to win back the trust of their customers. It was also a play to get new customers in the door."
“The strategy appears to have worked. In October 2018, NAB surpassed ANZ in terms of home loan market share. They now have the third largest home loan book, according to APRA data."
“Already this year we’ve seen BoQ and Virgin Money hike rates due to cost of funding pressures. Now that NAB has hiked as well, others are likely to follow in its shadow,” she concluded.
<img src="https://www.urban.com.au/images/2019/1/24/NAB%20rate%20hikes.JPG" alt="">
(Source: RateCity.com.au)
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j.ballantyne1990-6AQqhLzZaK

NAB hikes variable rates after saying they wouldn't less than 20 weeks ago

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A NAB survey has forecast Melbourne house prices to fall 7 per cent in 2019, more than the drop expected in Sydney house prices.
Sydney house prices are forecast fall 5.4 per cent in 2019.
The only capital cities forecast to grow in 2019 or 2020 are Adelaide and Hobart.
The NAB survey suggests Adelaide house prices will grow 1.7 per cent in 2019 and 2020 while Hobart house prices grow 1.8 per cent in 2019 and 2020.
In the uncertain market Australians plan to sit tight and <a href="/news/australians-plan-to-sit-tight-and-do-nothing-in-the-2019-property-market-nab-survey">do nothing in the 2019 property market</a>, according to the NAB survey. 
<img src="https://www.urban.com.au/images/2019/1/24/NAB%20sentiment%20outlook%203.JPG" alt="">
On average, consumers expect price falls of ‐2.1% over the next 12 months, according to property professional forecasts in NAB’s latest Residential Property Survey. 
NAB's survey found that New South Wales (‐3.1%) and Victoria (‐2.9%) are expected to lead the way down, with consumers a little less pessimistic than property professionals.  
<a href="https://www.propertyobserver.com.au/subscribe" target="_blank"><img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2019/1/1/Strip%20ad%20keep%20up%20in%202019.jpg" alt=""></a>
Numerous consumers in VIC (39%) and NSW (37%) anticipate price drops of 5% or more with 16% and 17% respectively also predicting falls of more than 10%.
Click <a href="https://www.propertyobserver.com.au/images/2019/1/24/NAB%20sentiment%20outlook%201.JPG" target="_blank">here</a> to enlarge.
<img src="https://www.urban.com.au/images/2019/1/24/NAB%20sentiment%20outlook%201.JPG" alt="">
 
Tasmania is the only state with positive expectations (2.2%).
“Tasmanians are by far the most positive across states, with almost 1 in 2 people there still expecting a positive price outcome, followed by Queensland at around 1 in 3”, said Mr. Oster.
Interestingly 1 in 5 consumers in New South Wales and Victoria still expect house prices to grow next year.  
Click <a href="https://www.propertyobserver.com.au/images/2019/1/24/NAB%20sentiment%20outlook%202.JPG" target="_blank">here</a> to enlarge.
<img src="https://www.urban.com.au/images/2019/1/24/NAB%20sentiment%20outlook%202.JPG" alt="">
By region the downturn is being driven by expectations for larger falls in capital city house prices (‐2.8%), with smaller falls in rural towns (‐1.0%) and major regional cities (‐0.9%).
Consumers living more than 5km from the nearest town (or the ‘bush’) are on average predicting modest growth of 0.6%.
<img src="https://www.urban.com.au/images/2019/1/24/NAB%20sentiment%20outlook%204.JPG" alt="">
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Melbourne houses set to fall the most in 2019: NAB survey

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Online retail sales accelerated over 2018 but were slower over the month of November, according to the latest data from NAB's Online Retail Sales Index (NORSI).
ABS data on traditional retailers showed month on month seasonally adjusted sales rose (0.3%) in October 2018, outpaced by NORSI which grew 0.9% in that month.
NAB estimates put Australian online spend at around $28.86 billion over the 12 months to November 2018, which is equivalent to 9.0% of spending at traditional bricks &amp; mortar retailers, as measured by the ABS.
<img src="https://www.urban.com.au/images/2019/1/10/NAB%20online%20retail.JPG" alt="">
The fastest growth in online retail sales over the year was recorded by department stores whose sales accelerated 10.6%.
Online grocery and liquor sales was again the second fastest category, growing 19.1% over the year to October.
Online sales in the personal and recreational category grew 12.4%, while media sales grew 14.6%, fashion grew 15.5%, and games and toys grew 55.5%.
<a href="https://www.propertyobserver.com.au/subscribe" target="_blank"><img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2019/1/Subscriber%20strip%20ad.jpg" alt=""></a>
Food catering grew 6.7% and the and the smallest spend share category, daily deals grew 5.7%.
The largest sales category, homewares and appliances contracted slightly.
SME merchants represent over 35% of all online sales. 
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Australian online spending equaled 9% of spending at brick and mortar stores: NAB

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The NAB has scrapped its forecast for two late 2019 rate cuts.
It now predicts no change until late 2020.
"We have delayed our expectation for the first RBA increase in the cash rate to the second half of 2020," Alan Oster, its chief economist said today.
"While output growth has been largely as expected over the 2018, wages pressure remains weak and hence inflationary pressure has remained low, with the core measures continuing to track below the RBA’s target band.
"We expect that will continue through all of 2019.
"Our forecasts see a moderation in growth back to potential of around 2.3 to 2.5% and unemployment falling a little further to 4.75% and then remaining at that level.
Click here <a href="https://www.propertyobserver.com.au/images/2018/12/12/NAB4.jpg" target="_blank">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/2018/12/12/NAB4.jpg" alt="">
"Falling house prices suggest a bigger impact on housing construction than previously incorporated and additional concerns about the consumer, though low rates and unemployment are important offsets.
"The past year, despite growth being stronger than expected, the RBA has overall proven more relaxed about current policy settings than we expected – largely as wage growth failed to lift significantly on the stronger growth outcomes - and we don’t see that changing any time soon.
"The Bank will be looking very carefully at the extent of the slowing in house prices – and in particular that the adjustment remains orderly.
"We can see the case for a forward-looking central bank beginning to very moderately start increasingly rates from the second half of 2020.
"As always the exact timing will be data dependent – with a lift in both wages growth and the inflation forecast particularly important in this regard."
It noted that markets have become very concerned and are now toying with the possibility of the risk of an interest rate cut in the next 6-9 months.
"While that is a possibility we would not rate it as more than a 30% probability.
"Indeed the rate cut view underplays the strength currently evident and likely to remain elsewhere in the economy."
Click here <a href="https://www.propertyobserver.com.au/images/2018/12/12/NAB2.jpg" target="_blank">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/2018/12/12/NAB2.jpg" alt="">
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“While falling house prices have garnered much media attention of late, businesses do not yet suggest they are having a material impact," Oster said.
"Falling house prices in themselves may have a ‘wealth effect’ on households but given the prior large run up the impact of the declines to date is unclear. 
"Also lower turnover of house sales and less housing construction activity is likely to have additional negative impacts on both the consumer and house building” Mr Oster said.
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Based on recent momentum NAB now expect house prices to fall further than previously forecast over the next two years.
Click here <a href="https://www.propertyobserver.com.au/images/2018/12/12/NAB-dwelling.jpg" target="_blank">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/2018/12/12/NAB-dwelling.jpg" alt="">
But its expects the decline to be orderly, with prices still remaining well up on 4 years ago. 
"We now expect peak-to-trough declines of around 15% in both Sydney and Melbourne. 
"We expect more moderate outcomes in the other capitals. 
"The decline in house prices to date represents a significant correction compared with recent housing cycles.
"It is unusual for prices to decline while the unemployment rate is falling and interest rates are low and relatively stable. 
"We believe that these declines have been driven by a number of factors including tighter credit, investor price expectations (which also see lower demand for credit) and weaker foreign demand. 
"It is also likely that with house prices having significantly outpaced the growth in household incomes overs recent years, there is some adjustment occurring to restore this balance," Oster said.
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NAB scraps its two 2019 rate hike prediction - nothing until late 2020 

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Dwelling investment increased 1.0% in the quarter, and has risen in each of the last four quarters, according to the Q3 Report released by NAB.
However this quarter, NAB found that the increase was entirely driven by alterations &amp; additions (up 4.5% q/q), as investment in new dwellings fell 0.8% q/q.
Alongside the cooling in the housing market, NAB expect dwelling investment to decline over the next couple of years.
Alan Olster, NAB Group Chief Economist said that a pull-back in new building approvals is already evident, though the large pipeline of work yet to be done will provide some support, suggesting the real weakness will likely occur in 2020.
<img src="https://www.urban.com.au/images/2018/12/5/NAB%20Q3.JPG" alt="">
The report also found that underlying business investment declined for the second consecutive quarter (-1.9% q/q).
Reflected largely by a fall in non-dwelling construction (-5.6% q/q) as both new building and new engineering construction declined.
Mr Olster noted, "the weakness in non-dwelling construction appears to be at least partly related to the mining sector as despite overall non-mining investment being up (1.0% q/q),  mining sector investment declined 7.5% q/q."
"There was a large fall in Northern Territory non-dwelling construction, he added"
As the tail-end of the construction phase of the LNG mega-projects wraps up, NAB expect mining investment to stabilise, with some potential upside given the improvement in business conditions in the sector.
Following the latest releases of growth, labour market and prices data, NAB have stated they are reassessing their view on monetary policy.
They currently have the next cash rate movement forecast as an increase in mid 2019, but are in the process of reviewing this statement.
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Increase in dwelling investment driven by renovations: NAB

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EXPERT OBSERVATION
The economy grew at a strong pace over the first half of 2018 – with output expanding by over 4% in annualised terms.
Looking forward, we expect growth to slow in annual terms, though still at a pace which should erode spare capacity.
Public sector demand – both infrastructure spending and NDIS-related consumption will remain strong. We also expect non-mining business investment to benefit from additional spill-overs.
Exports are expected to continue to grow relatively strongly - as the last of the large LNG projects reach full production capacity – and then level off.
<img src="https://www.urban.com.au/images/2018/11/14/NAB%20GDP.JPG" alt="">
Mining is a potential upside factor to the forecasts, with that sector now clearly reporting the strongest conditions and confidence, commodity prices having remained high and the drag from the unwinding of the boom now fading.
Despite the above special factors adding to growth, our main concern remains weak consumption growth - which is likely to weigh on broader economic growth (accounting as it does for over half of all economic activity).
With an already low savings rate, weak wage growth, high debt levels and some anxiety from slower growth in household wealth - we see a very cautious household sector over the next couple of years.
The construction cycle is also expected to move down but, only moderately and as such its impact on growth will be small.
<img src="https://www.urban.com.au/images/2018/11/14/NAB%20GDP%202.JPG" alt="">
On a more positive note, recent data suggest that the labour market remains healthy with trend employment growth tracking at around 25-30 k per month.
This should be enough to see the unemployment rate decline further after falling to a 6-year low of 5.0% in September.
Despite the strong growth and tightening labour market, the September quarter CPI suggests that inflationary pressure remains weak.
While a number of one off adjustments to administered prices drove the weakness in headline inflation, our overall read is that both imported and domestic inflation remain subdued.
We have left our outlook for interest rates unchanged this month but our view remains heavily data dependent.
While growth has been strong and progress has been made on reducing the unemployment rate, the RBA will likely want to see further evidence of a pickup in wages growth and inflation.
There has been some progress on this front but the process has been gradual and is likely to remain so, with still some spare capacity in the labour market and the economy more broadly.
Readings on the WPI for Q3 and labour market data for October will provide important updates on the current pace of wage growth and momentum in the labour market.
ALAN OSTER is NAB's Chief Economist
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NAB forecast economic growth to slow: Alan Oster

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National Australia Bank, Australia's fourth largest bank, has announced it will be changing the special on its base variable rate from 3.69% to 3.87%.
Their shift to retain customers is a reaction to the tighter lending restrictions continuing to impact mortgage applications, which continue to slide.
NAB have shifted focus to maintaining their existing customers, which chief executive Andrew Thorburn said has put the bank in 'unchartered territory."
"The decision to stop chasing new business with aggressive discounts and to reward loyal customers has put the bank in uncharted territory after delivering a result that revealed further deterioration in its net interest margin," Thorburn said.
”The discount for the standard variable rate has continued to go up and up and up and up and so as the housing cycle has slowed that increases the pace and increases the intensity, it’s been a long-term trend and its got worse in the last two or three years."
From Friday 9 November, NAB’s Base Variable Rate Special Offer, which is available for new owner occupier principal and interest customers, will be 3.87%.
The change will only affect new customers taking out this product. This means existing customers will not experience a rate hike. 
From Friday, CBA will now have the lowest ongoing variable rate out of the big four banks.
<img src="https://www.urban.com.au/images/2018/11/5/Nab%20Rates%20Hiked.JPG" alt="">
 
RateCity.com.au research director Sally Tindall said over the last six months NAB has been "a champion of competitive pricing, forcing other lenders to put low rates on the table".
"It is rare to see a bank hike an interest rate but grant immunity to their existing customers. NAB is clearly focused on backing its own customers, over potential new ones," she said.
While NAB has stepped back from low rate loans, HSBC and CBA both cut their owner occupier principal and interest rates, with HSBC now offering 3.59%, and CBA now offering 3.79% for new customers with 70% equity in their home.
 
 
 
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NAB announces variable rate hike for all new customers

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EXPERT OBSERVATION
China’s response to growing trade tensions with the United States has been multi- faceted. China’s central government has proposed loosening policy restrictions on infrastructure investment – developments that are typically managed and funded at the local government level. 
The latter could be problematic, as China’s local government debt could be much larger than widely thought – an echo of earlier fears from early 2014.
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COMPLEXITY OF LOCAL GOVERNMENT DEBT MAKES IT HARD TO ASSESS
China’s local government debt levels are at best opaque. According to official data, the total debt of local governments – which comprise a broad range of authorities at provincial, city, county and village/town level – was RMB 18.3 trillion in September 2018, equivalent to around 21% of GDP. 
However, it is likely that this figure does not present the full picture of their debts – which are larger, more complex and risky.
CHINA’S BUDGET IMBALANCE
Local governments struggle to fund their spending.
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Following the 1994 Budget Law, which shifted much of the revenue generation from local governments to Beijing, local governments were forced to generate alternative sources of funding to meet their expenditure requirements. The local government share of fiscal revenue fell from 78% in 1993 to 44% in 1994. Prohibited by this law from issuing bonds or borrowing directly from financial institutions, they established local government financing vehicles (LGFVs) – which secured debt from banks, shadow banks and other sources.
The scale of this debt expanded rapidly in the post-GFC period, as China’s infrastructure program spared the country from the worst of the crisis.
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At the end of 2013, China’s National Audit Office released a detailed review of local government debt – highlighting the broader scale of these liabilities. In addition to the debts that local governments had direct obligations to repay (around RMB 10.9 trillion in mid-2013) – which matched the official debt statistics above – these authorities also had hidden debts (including those debts they guaranteed for LGFVs or public-private partnerships) – which totalled an additional RMB 7.0 trillion. However, this broader estimate of local government debt has not been updated since late 2014.
Fears around this debt largely dissipated since this period, in part because Beijing permitted provincial, municipal and some city governments the authority to issue bonds from mid-2014 (subject to annual caps). Ministry of Finance data suggests that bonds accounted for almost 90% of the reported total debt at the end of 2017. 
However, the bulk of bond purchasers have been banks – at the behest of the central government and regulators – with the returns on these bonds usually unattractive to other investors. Overall, the lower level of concern appears due to hidden debt being overlooked, rather than it being effectively addressed.
In late March 2018, the Chinese Academy of Social Sciences estimated that the total off-balance sheet liabilities of LGFVs was in the order of RMB 30 trillion, while a further RMB 10 trillion could be hidden within so-called public-private partnerships (where the “private” partner has often been a state-owned enterprise). 
A recent report by Standard and Poor’s produced a similar range for off-balance sheet debts. These estimates are relatively uncertain, since the sheer number and complexity of LGFV arrangements makes them difficult to track.
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OFF-BALANCE SHEET DEBT
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Growth largely overlooked since 2014
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Combining these estimates of off-balance sheet debts to the officially reported sums suggests that China’s local government debt could be in the range of 55% to 66% of GDP in September 2018. With another 16% of GDP in central government debt, this suggests that China’s total government debt is well above the 60% benchmark that is seen as a prudent limit in advanced economies. It is also above the IMF’s estimate of China’s total government debt – which was around 47% of GDP in 2017.
DEBT RISKS RISING IN CURRENT CLIMATE
A critical problem related to China’s local government debt is the capacity of these authorities to service these liabilities. The total fiscal revenue of local governments was just RMB 9.1 trillion in 2017 (less than one-fifth of the lower bound estimate of total debt).
 With limited ability to collect tax revenue (following the 1994 law change), many local governments have relied on land sales as a key source of income – averaging around 32% of the total in 2017 (behind central government transfers) – albeit the share differs widely across the country.
Land sales are not considered a sustainable long term of revenue, and a fall in sales could result in local governments defaulting on their debts or failing to support distressed LGFVs. This could flow into greater instability in China’s financial sector, particularly if central authorities follow through on public statements and do not provide a bail out.
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LOCAL GOVERNMENT REVENUE (2017)
Land sales contribute too much to funding
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Similarly, increasing infrastructure investment in the short term could mean a large expansion in local government debt, leading to higher interest payments even if revenue levels can be maintained. The mismatch between the short term maturity of many sources of local government debt – such as bank loans and shadow banking products – and longer term return on infrastructure investment leads to greater risk.
CONCLUSIONS
The greater scale of local government debt than is widely acknowledged in official figures highlights the risks associated with infrastructure led stimulus to China’s economy. It also highlights the need to continue reforms to the broader economy – where progress has been disappointing. A key reform that would boost the sustainability of local government revenues would be the implementation of property taxes – proposed for over a decade, but repeatedly delayed. A nationwide tax had been scheduled for introduction in 2019, however this proposal has been delayed with an uncertain start date.
GERARD BURG is senior economist - Asia Group Economics at National Australia Bank.
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Chinese local government debt fears are returning: NAB's Gerard Burg

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For the tenth consecutive quarter, property experts identified tight credit as the biggest constraint on new housing development in the country, according to the latest NAB Residential Property Survey.
Moreover, they said it was causing more concern than at anytime since mid-2011.
Clearly, intensified lending scrutiny by banks and APRA-inspired tighter credit policies has played a key role.
Tight credit was also singled out as the biggest constraint for new housing development in all states - particularly in NSW where it was viewed as a ‘very significant’ constraint.
The overall level of concern over rising interest rates also grew. It was seen as being most problematic by property professionals in NSW and SA/NT and least problematic in VIC.
Property professionals overall were less concerned about all other factors, especially around lack of development sites and labour availability.
<img src="https://www.urban.com.au/images/2018/10/11/NAB%20QARP%201.JPG" alt="">
Access to credit remains the most ‘significant’ impediment for buyers of existing property as well according to surveyed property professionals.
It was also seen as a much bigger issue than in the last survey and more so than at any time since the Survey began. In fact the property experts surveyed in all states considered access to credit to be the most ‘significant’ issue in their state.
Rising interest rates replaced employment security as the second biggest issue for buyers of existing property in Australia - and in all states expect VIC (house price levels) and WA (employment security).
<img src="https://www.urban.com.au/images/2018/10/11/NAB%20QARP%202.JPG" alt="">
Heightened concern about interest rates is consistent with NAB’s view of the market.
The author's of the survey stated:
"We expect growth to remain above trend which should see the labour market tighten, wages growth lift and inflation more broadly begin to rise.
"As spare capacity is reduced, and inflationary pressures become more evident, the degree of accommodation in monetary policy will be gradually reduced, with the RBA starting a process of rates normalisation towards a more neutral setting."
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Constraint on credit a growing concern for new and established housing: NAB

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FOREIGN BUYERS
The boom in Australian real estate sales to foreign investors has run its course, according to the NAB survey of property industry participants.
These results highlight a continuing decline in foreign buying activity resulting from policy changes in China on foreign investment outflows and tighter restrictions on foreign property buyers in Australia.
In Q3, there were fewer foreign buyers in the market for Australian property, with their market share falling to a seven-year low of 8.1% in new housing markets and a survey low 4.1% in established housing markets.
<img src="https://www.urban.com.au/images/2018/10/10/Foreign%20Buyers%203.JPG" alt="">
The share of sales to foreign buyers fell in all states except VIC where their share rose to 13.0% (11.7% in Q2), but still well below the record highs approaching 33% in late-2014.
The share of foreign buyers in NSW was unchanged at 7.5% but also well down from a high of 21.0% in Q1 2015.
The share of foreign buyers in QLD also fell to 6.2%, down from 22.8% in Q2, to its lowest level since mid-2014.
<img src="https://www.urban.com.au/images/2018/10/10/Foreign%20Buyers%201.JPG" alt="">
A similar trend is evident in established markets with the shares of sales to foreign buyers falling in all states.
Property professionals in VIC reported the highest share of buyers in established housing markets at 5.5%, followed by NSW (4.5%), WA (3.7% and QLD (3.7%).
Moreover, the share of foreign buyers has well fallen below survey average levels in all states.
<img src="https://www.urban.com.au/images/2018/10/10/Foreign%20Buyers%202.JPG" alt="">
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