National property developer Goldfields has secured permit approval and appointed Victorian residential builder Ironside to begin work on The Brightly, an 11-storey, wellness and lifestyle-focused mixed-use development in Richmond.

<a href="https://www.apartments.com.au/developers/goldfields-group">Goldfields</a> has partnered with Dexus Real Estate Partnership Fund 1 (DREP 1) as co-investor and delivery partner in the <a href="https://www.apartments.com.au/new-apartments/the-brightly-9-15-brighton-street-richmond-vic-3121">Brighton Street project</a>.

With architecture and interiors by design practice Cera Stribley, The Brightly will feature 100 apartments, a resident-only wellness space, elevated dining experiences including a private dining room and a rooftop garden lounge, and ground-floor retail designed to integrate with Richmond’s local character.

The wellness space will feature a hot magnesium pool, cold plunge, steam room, sauna, and a vitamin-infused drinking station for refreshment and rehydration.

The Brightly’s focus on wellness extends to the rooftop landscaped by award-winning landscape architect Jack Merlo. It will feature canopied retreats and panoramic views of the Melbourne CBD and Richmond Hill treetops. Residents can also host guests with a private bookable dining space on the rooftop garden lounge and an indoor option on the first level.

Cera Stribley’s architectural vision drew inspiration from the surrounding area, using the flowing form of the train lines to shape the façade and create a dialogue between the building and Richmond’s rich history. The design features a four-level podium lined with lush greenery, honouring the suburb’s character and streetscape through its scale and materials.

There will be a choice&nbsp;of one-, two- and three-bedroom apartments, along with 19 exclusive sub-penthouses and penthouses, for prospective purchasers.

Lachlan Thompson, Goldfields’ CEO, said The Brightly will define a new kind of urban luxury for Inner East living.

“By drawing on Richmond’s vibrant mix of culture and hospitality, we’ve combined a lifestyle centred on wellness,” Thompson said.

“Its proximity to Melbourne's sports and entertainment precinct, the CBD, parks, and public transport makes it a prime location for both young professionals and those seeking a lifestyle change. What we’ve created is something remarkable - it’s real, it's Richmond, and it’s refined."

Dexus Real Estate Partnership Fund 1 Fund Manager, Jason Howes, said the Brightly is a high-quality investment in a high demand area with limited residential stock expected to be added in the coming years.

“Partnering with Goldfields, we are delivering a project that will redefine lifestyle focused urban living, offering residents exceptional design and amenities in one of Melbourne's most vibrant suburbs,” he said.

Onsite demolition is underway, with construction set to commence in April 2026 and completion targeted for late 2027. The Brightly will launch to market in mid-2026.

[smartcode_project_cta:default project_id=146631]

Joel Robinson

Goldfields greenlit for The Brightly, Richmond apartment development

The Allan Labor Government has revealed the remaining 23&nbsp;Train and Tram Zone Activity Centres as part of their plan to try and encourage development around some of Melbourne's most connected suburbs.

The new zones includes&nbsp;four smaller ‘neighbourhood centres’ to plan for more modest growth.

<ul>
	<li>Five are connected to the new Metro Tunnel and are now experiencing more services: Caulfield, Springvale, Noble Park, Yarraman (neighbourhood centre), and Dandenong stations.</li>
	<li>Eight are along the Frankston Line, which has recently returned to the City Loop: Hawksburn, Toorak (Beatty Avenue), Armadale (High Street), Malvern (Glenferrie Road), Glen Huntly, Ormond, Bentleigh, and Mentone stations</li>
	<li>Four are along the Sandringham Line, which will see an increase in services later this year: South Yarra, Prahran, Windsor and Elsternwick stations</li>
	<li>Three are on the Belgrave/Lilydale Line and benefit from five-minute peak services on average between Ringwood and the city: Blackburn, Nunawading, and Mitcham stations</li>
	<li>Two neighbourhood centres on the Alamein Line: Ashburton Station, plus a combined centre for the two closest stations on the metropolitan network Riversdale &amp; Willison stations</li>
	<li>One neighbourhood centre, Toorak Village, is a built-up area along the Route 58 tram.</li>
</ul>

The <a href="https://spatial.planning.vic.gov.au/activitycentre/">draft maps</a> will now be subject to detailed community consultation.

A similar process occurred for the first 10 pilot Activity Centres, with clear changes made as a direct result of this community consultation.

Read more:&nbsp;<a href="https://www.apartments.com.au/news/vic/50-new-train-and-tram-zone-activity-centres-to-encourage-new-apartment-development-across-melbourne">50 new ‘train and tram zone’ activity centres to encourage new apartment development across Melbourne</a>

The final train and tram zones will set clear expectations on where new homes can go, cutting out delays, uncertainty and red tape and getting homes off the ground. The remaining two in inner-Melbourne that cover the entire Local Government Areas of Melbourne and Yarra, will go through a separate process.

In the immediate ‘core’ the plans allow for more homes in taller apartment buildings.&nbsp;Some cores have heights of six storeys, while others have up to 20 storeys, only when it is in line with those councils’ planning work.

Eligible buildings across the core will be ‘deemed to comply’ with planning rules and be exempt from VCAT review. Applications in the core that exceed the specified height of the site are not eligible for this fast-tracked pathway.

In the walkable catchments that surround the core, the plans propose gentler height limits and more low-rise apartments and townhouses. Heritage and landscape overlays will stay in place.

Inner catchments, representing up to a five-minute walk from the station or centre, propose limits of four storeys, or six storeys on larger blocks of more than 1,000 sqm, while outer catchments, representing up to a 10-minute walk from the station or centre, propose limits of three storeys, or four storeys on larger blocks of more than 1,000 sqm.

By 2051, train and tram zones will help deliver more than 300,000 new homes, with final plans for all 50 new centres expected to be completed by mid this year.

“We want more Victorians to have the opportunity to live close to public transport, their loved ones, and the things that matter to them,"&nbsp;Minister for Planning Sonya Kilkenny said.

“Whether it’s making it easier to build homes close to public transport, townhouses in our inner suburbs, or family homes with a backyard, our planning reforms are all about giving more Victorians real housing choice.

“While we’re focused on giving more young Victorians the opportunity to have a home of their own, the Liberals are blocking them from being built. They oppose more homes near transport, jobs and services.”

Toorak and South Yarra earmarked for greater density as VIC Gov releases final Train and Tram Zone Activity Centres

Glen Waverley’s housing shortage is set to be closed by 50 per cent with the approval of 795 new apartments which will rise from a former carp park in the heart of the suburb.

The plans, lodged by <a href="https://www.apartments.com.au/developers/sunkin-property-group">Sunkin Property Group</a> and now approved by the Victorian State Government Development Facilitation Program, will transform the 6,114 sqm carpark at 281 Springvale Road, into an $800 million, mixed-use residential and commercial development in the metropolitan activity centre.&nbsp;

“281 Springvale Road has received planning approval for a mixed-use, high-density development that will provide much needed homes in Melbourne’s middle-ring suburbs, including affordable housing," Sunkin's GM of Property and Development Lloyd Collins says.

"We worked closely with key stakeholders, the Department of Transport and Planning, Suburban Rail Loop Authority and Monash City Council to achieve an integrated design with an activated retail ground level that will add to the success of Glen Waverley.

Glen Waverley’s population is projected to grow by 9 per cent by 2031, with an additional 1,600 dwellings required to &nbsp;service the area.

Around 1,000 sqm of the former carpark has been retained by Monash City Council for a new Civic Plaza, creating a central meeting point and public transport link for the local community. &nbsp;

Sunkin Property Group acquired the site from Monash City Council in 2024. The site will remain open as a public carpark until development commences.

[smartcode_project_cta:default project_id=149491]

$800 million, 800-unit development permit fast-tracked for Glen Waverley carpark

UAE developer <a href="https://www.apartments.com.au/developers/arada">Arada</a> is continuing to unveil its billions of dollars of residential development it is set to deliver in Australia.

Following on its plans for <a href="https://www.apartments.com.au/news/nsw/arada-pitches-castle-hill-apartment-plans-ahead-of-2026-launch">431 apartments in Castle Hill</a>&nbsp;and the 2025 bail-out of construction firm Roberts &amp; Co so it can build its own developments, Arada&nbsp;has sought the NSW Government's approval for three towers in the Campsie town centre.

The project, dubbed One Campsie, has been designed by Woods Bagot and will deliver 346 apartments to Beamish Street across three interconnected towers rising 24, 32, and 39 storeys.

According to the Woods Bagot Architectural Design Report, the design seeks to “redefine the urban experience of a rapidly transforming town centre,” delivering housing above an activated ground plane that integrates civic and commercial uses. The design adopts a three-part vertical composition, stepping and articulating the tower to reduce visual bulk and respond to its varied urban interfaces.

<img alt="First Look: Arada unveils 39-storey mixed-use tower for Campsie town centre in State Significant Development bid" data-entity-type="file" data-entity-uuid="f515807f-7277-4ea5-8b2b-a5718514f30a" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Campsie%20podium.png?VersionId=J3oSJpOvye8gpg1kjagODjdhOb0Cl28I" />

At street level, the scheme places significant emphasis on public domain upgrades. A new civic plaza is proposed opposite the Orion Theatre, alongside a landscaped pocket park and a through-site pedestrian link connecting Beamish Street to Campsie Street and Ninth Avenue. The Urban Design Justification Report states that the proposal “builds on Council’s Master Plan by applying a place-led urban design framework that responds to the site’s unique conditions and enhances pedestrian experience and public benefit.”

The documents note that the development aligns with the Master Plan’s intensification strategy for sites within walking distance of the Metro station, while seeking to retain solar access to key public spaces. As outlined in the Urban Design Report, the proposal delivers “intensification within walking distance of the Metro Station while retaining solar access to key parks."

<img alt="First Look: Arada unveils 39-storey mixed-use tower for Campsie town centre in State Significant Development bid" data-entity-type="file" data-entity-uuid="586ad606-a84f-49cc-b715-fc3ecb731205" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Campsie%20podium%20a.png?VersionId=gNHaD.Os8yW4LVOdsJIdmmhlgQArs0Gm" />

Woods Bagot’s design narrative also draws on local history and Aboriginal cultural context. The Architectural Design Report references engagement with Wangal Country and the Cooks River landscape, seeking to embed a connection to Country through material selection, planting, and public art integration. The broader vision, as described in the report, is to create a building that functions as a “community catalyst, not only as a place to live, but as a vibrant destination for work and play that brings people together, supports local culture, and contributes meaningfully to the civic identity of Campsie.”

<img alt="First Look: Arada unveils 39-storey mixed-use tower for Campsie town centre in State Significant Development bid" data-entity-type="file" data-entity-uuid="f1bc9a44-0c1a-4e3f-8b27-38070b0d2744" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Article%20Feature%20Image%20%28Grid%29_2.png?VersionId=1JmMWg6jOU1rPpS9hCxy8s8H48xc0EiM" />

Located at 124–142 Beamish Street and 16–18 Ninth Avenue, the site occupies a key stretch of Beamish Street, Campsie’s traditional high street, characterised by fine-grain retail, multicultural dining, and proximity to civic infrastructure including the Orion Theatre and Canterbury Civic Centre. The proposed civic plaza and pocket park aim to strengthen this interface, formalising connections between retail frontages, public transport, and community facilities.

If approved, One Campsie would mark one of the tallest and most ambitious additions to the suburb’s skyline, reflecting the broader shift toward higher-density living around transport nodes in Sydney’s middle-ring centres.

First Look: Arada files for trio of apartment towers in Campsie town centre

Syd​ney builder-developer Scion has lodged a State Significant Development Application (SSDA) for a 22-storey mixed-use tower at <a href="https://www.apartments.com.au/new-apartments/96-anzac-avenue-west-ryde-nsw-2114">96 Anzac Avenue, West Ryde</a>, marking a significant step in the transformation of the Victoria Road gateway precinct.

Designed by Turner, the proposal would replace an ageing two-storey commercial building with 145 apartments and 29 co-living rooms, above ground-floor retail and three basement levels of parking.

The 3,149 sqm site sits just 150 metres from West Ryde train station, at the edge of the suburb’s retail core and diagonally opposite Anzac Park. It occupies a prominent corner with frontages to both Anzac Avenue and Victoria Road, positioning it as a key transition point between established residential neighbourhoods and the commercial centre.

The scheme is being advanced under the Housing Delivery Authority pathway as a State Significant Development, alongside a concurrent rezoning to lift the site’s height and floor space ratio controls.

Turner says in the Architectural Design Report that the proposal "responds to a unique opportunity to support the revitalisation of West Ryde through the delivery of a landmark development that combines high-quality residential offerings with enhanced public realm and active ground plane uses.”

Scion will be pushing height almost five times higher than what had been pitched for the site before.

Turner says the increased scale aligns with Council’s strategic direction for the precinct, including the West Ryde Town Centre Revitalisation Strategy (2019), the Draft Masterplan (2021), and the West Ryde–Meadowbank Renewal Strategy (2023).

“The increased height and density proposed aligns with Council’s evolving strategic direction for the precinct, as outlined in the Draft Revitalisation Strategy (2019), the 2021 Draft Masterplan, and the broader West Ryde–Meadowbank Renewal Strategy (2023), which collectively call for higher density, transit-oriented development and design excellence."

Turner describes the vision as establishing “a contemporary, mixed-use development that contributes positively to the West Ryde town centre.”

<img alt="West Ryde" data-entity-type="file" data-entity-uuid="c5c22c11-92b8-4ca6-b77b-b5848ae0176d" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-02-12%20at%202.41.34%E2%80%AFPM.png?VersionId=aom0z8azYDw7Hl6.A6vDbCom5ozZICn5" />

The architectural response has been shaped by the site’s gateway role along Victoria Road and its proximity to Anzac Park and surrounding heritage elements, including the Sydney Water pumping station opposite the site.

The design process also incorporated consultation around Connecting with Country principles. The design report outlines engagement with Cultural Heritage Consultants Artefact and Aunty Julie, a Burruberongal woman of the Darug Nation, informing planting selection, materiality and potential public art opportunities.

Turner says the scheme aims to optimise the site’s capacity while balancing yield and amenity.

“The proposed scheme seeks to optimise the site’s potential by balancing yield, amenity, and urban integration. It will deliver a high-quality, mixed-use precinct that supports West Ryde’s ongoing transformation into a connected, accessible, and liveable centre."

Scion recently completed the build of its own development, The Sterling in Lane Cove. They are currently building Chatham in West Ryde, just 500m from the new proposal. Those 62 apartments will complete later this year.

First look: Scion pitches tower plans for West Ryde

Philip Lowe

RBA Governor Philip Lowe&#39;s meeting statement

At its meeting today, the Board decided to maintain the current policy settings, including the targets of 10&nbsp;basis points for the cash rate and the yield on the 3-year Australian Government bond, as well as the parameters of the Term Funding Facility and the government bond purchase program.

The global economy is continuing to recover from the pandemic and the outlook is for strong growth this year and next. The recovery remains uneven, though, and some countries are yet to contain the virus. Global trade in goods has picked up strongly and commodity prices are mostly higher than at the start of the year. However, inflation remains low and below central bank targets.

Sovereign bond yields have been steady recently after increasing earlier in the year due to the positive news on vaccines and the additional fiscal stimulus in the United States. Inflation expectations have lifted from near record lows to be closer to central banks&#39; targets. The 3-year government bond yield in Australia is at the Board&#39;s target of 10&nbsp;basis points and lending rates for most borrowers are at record lows. The Australian dollar remains in the upper end of the range of recent years.

The economic recovery in Australia has been stronger than expected and is forecast to continue. This recovery is especially evident in the strong growth in employment, with the unemployment rate falling further to 5.6&nbsp;per&nbsp;cent in March and the number of people with a job now exceeding the pre-pandemic level.

The Bank&#39;s central scenario for GDP growth has been revised up further, with growth of 4&frac34;&nbsp;per&nbsp;cent expected over 2021 and 3&frac12;&nbsp;per&nbsp;cent over 2022. A pick-up in business investment is expected and household spending will be supported by the strengthening in balance sheets over the past year. The unemployment rate is expected to continue to decline, to be around 5&nbsp;per&nbsp;cent at the end of this year and around 4&frac12;&nbsp;per&nbsp;cent at the end of 2022.

Despite the strong recovery in economic activity, the recent CPI data confirmed that inflation pressures remain subdued in most parts of the Australian economy. A pick-up in inflation and wages growth is expected, but it is likely to be only gradual and modest. In the central scenario, inflation in underlying terms is expected to be 1&frac12;&nbsp;per&nbsp;cent in 2021 and 2&nbsp;per&nbsp;cent in mid&nbsp;2023. In the short term, CPI inflation is expected to rise temporarily to be above 3&nbsp;per&nbsp;cent in the June quarter because of the reversal of some&nbsp;COVID-19-related price reductions.

Housing markets have strengthened further, with prices rising in all major markets. Housing credit growth has picked up, with strong demand from owner-occupiers, especially first-home buyers. Given the environment of rising housing prices and low interest rates, the Bank will be monitoring trends in housing borrowing carefully and it is important that lending standards are maintained.

At its July meeting, the Board will consider whether to retain the April 2024 bond as the target bond for the 3-year yield target or to shift to the next maturity, the November 2024 bond. The Board is not considering a change to the target of 10&nbsp;basis points. At the July meeting, the Board will also consider future bond purchases following the completion of the second $100&nbsp;billion of purchases under the government bond purchase program in September. The Board is prepared to undertake further bond purchases to assist with progress towards the goals of full employment and inflation. The Board places a high priority on a return to full employment.

The date for final drawings under the Term Funding Facility is 30&nbsp;June 2021. Given that financial markets in Australia are operating well, the Board is not considering a further extension of this facility. Authorised deposit-taking institutions have drawn $100&nbsp;billion so far and a further $100&nbsp;billion is currently available. Given the facility provides funding for 3&nbsp;years, it will continue to support low funding costs in Australia until mid&nbsp;2024.

The Board is committed to maintaining highly supportive monetary conditions to support a return to full employment in Australia and inflation consistent with the target. It will not increase the cash rate until actual inflation is sustainably within the 2&nbsp;to 3&nbsp;per&nbsp;cent target range. For this to occur, the labour market will need to be tight enough to generate wages growth that is materially higher than it is currently. This is unlikely to be until 2024 at the earliest.

The RBA kept the official cash rate at record lows at its May meeting

Housing markets strengthen further in all major markets: RBA Governor Philip Lowe's May 2021 meeting statement

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Expert Observer

At its meeting today, the Board decided to maintain the current policy settings, including the targets of 10 basis points for the cash rate and the yield on the 3-year Australian Government bond, as well as the parameters of the Term Funding Facility and the government bond purchase program.

The rollout of vaccines is supporting the recovery of the global economy, although the recovery is uneven. While there are still considerable uncertainties regarding the outlook, the central case has improved. Global trade has picked up and commodity prices are mostly higher than at the start of the year. Inflation remains low and below central bank targets.

Sovereign bond yields have increased over recent months due to the positive news on vaccines and the additional fiscal stimulus in the United States. Inflation expectations have also lifted from near record lows to be now closer to central banks' targets. The 3-year government bond yield in Australia is at the Board's target of 10 basis points and lending rates for most borrowers are at record lows. The Australian dollar remains in the upper end of the range of recent years.

The economic recovery in Australia is well under way and is stronger than had been expected. The unemployment rate fell to 5.8 per cent in February and the number of people with a job has returned to the pre-pandemic level. GDP increased by a strong 3.1 per cent in the December quarter, boosted by a further lift in household consumption as the health situation improved. The recovery is expected to continue, with above-trend growth this year and next. Household and business balance sheets are in good shape and should continue to support spending.

[smartcode_project:default project_id=7275]

Nevertheless, wage and price pressures are subdued and are expected to remain so for some years. The economy is operating with considerable spare capacity and unemployment is still too high. It will take some time to reduce this spare capacity and for the labour market to be tight enough to generate wage increases that are consistent with achieving the inflation target. In the short term, CPI inflation is expected to rise temporarily because of the reversal of some COVID-19-related price reductions. Looking through this, underlying inflation is expected to remain below 2 per cent over the next few years.

Housing markets have strengthened further, with prices rising in most markets. Housing credit growth to owner-occupiers has picked up, with strong demand from first-home buyers. In contrast, investor credit growth remains subdued. Given the environment of rising housing prices and low interest rates, the Bank will be monitoring trends in housing borrowing carefully and it is important that lending standards are maintained.

[smartcode_project:default project_id=27728]

The Board remains committed to the 3-year government bond yield target of 10 basis points. Later in the year it will consider whether to retain the April 2024 bond as the target bond or to shift to the next maturity. The initial $100 billion government bond purchase program is almost complete and the second $100 billion program will commence next week. Beyond this, the Bank is prepared to undertake further bond purchases if doing so would assist with progress towards the goals of full employment and inflation. Authorised deposit-taking institutions have drawn $95 billion under the Term Funding Facility and have access to a further $95 billion. Since the start of 2020, the RBA's balance sheet has increased by around $215 billion.

These various monetary measures are continuing to help the economy by keeping financing costs very low, contributing to a lower exchange rate than otherwise, and supporting the supply of credit and household and business balance sheets. Together, monetary and fiscal policy are contributing to the recovery in aggregate demand and the pick-up in employment.

[smartcode_project:default project_id=22057]

The Board is committed to maintaining highly supportive monetary conditions until its goals are achieved. The Board will not increase the cash rate until actual inflation is sustainably within the 2 to 3 per cent target range. For this to occur, wages growth will have to be materially higher than it is currently. This will require significant gains in employment and a return to a tight labour market. The Board does not expect these conditions to be met until 2024 at the earliest.
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Bank will be monitoring trends in housing borrowing carefully: RBA Governor Philip Lowe's April 2021 meeting statement

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RBA ANNOUNCEMENT

At its meeting today, the Board decided to maintain the current policy settings, including the targets of 10 basis points for the cash rate and the yield on the 3-year Australian Government bond, as well as the parameters of the Term Funding Facility and the government bond purchase program.

The outlook for the global economy has improved over recent months due to the ongoing rollout of vaccines. While the path ahead is likely to remain bumpy and uneven, there are better prospects for a sustained recovery than there were a few months ago. Global trade has picked up and commodity prices have increased over recent months. Even so, the recovery remains dependent on the health situation and on significant fiscal and monetary support. Inflation remains low and below central bank targets.

The positive news on vaccines together with the prospect of further significant fiscal stimulus in the United States has seen longer-term bond yields increase considerably over the past month. This increase partly reflects a lift in expected inflation over the medium term to rates that are closer to central banks' targets. Reflecting these global developments, there have been similar movements in Australian bond markets. Changes in bond yields globally have been associated with volatility in some other asset prices, including foreign exchange rates. The Australian dollar remains in the upper end of the range of recent years.

[smartcode_project:default project_id=30087]

In Australia, the economic recovery is well under way and has been stronger than was earlier expected. There has been strong growth in employment and a welcome decline in the unemployment rate to 6.4 per cent. Retail spending has been strong and most of the households and businesses that had deferred loan repayments have now recommenced repayments. The recovery is expected to continue, with the central scenario being for GDP to grow by 3½ per cent over both 2021 and 2022. GDP is expected to return to its end-2019 level by the middle of this year.

Wage and price pressures are subdued and are expected to remain so for some years. The economy is still operating with considerable spare capacity and the unemployment rate remains higher than it has been for some years. Further progress in reducing spare capacity is expected, but it will be some time before the labour market is tight enough to generate wage increases that are consistent with achieving the inflation target. In the central scenario, the unemployment rate will still be around 6 per cent at the end of this year and 5½ per cent at the end of 2022. In underlying terms, inflation is expected to be 1¼ per cent over 2021 and 1½ per cent over 2022. CPI inflation is expected to rise temporarily because of the reversal of some COVID-19-related price reductions.

[smartcode_project:default project_id=6798]

The current monetary policy settings are continuing to help the economy by keeping financing costs very low, contributing to a lower exchange rate than otherwise, and supporting the supply of credit and household and business balance sheets. Together, monetary and fiscal policy are supporting the recovery in aggregate demand and the pick-up in employment.

Lending rates for most borrowers are at record lows and housing prices across Australia have increased recently. Housing credit growth to owner-occupiers has picked up, but investor and business credit growth remain weak. Lending standards remain sound and it is important that they remain so in an environment of rising housing prices and low interest rates.

[smartcode_project:default project_id=27728]

The Bank remains committed to the 3-year yield target and recently purchased bonds to support the target and will continue to do so as necessary. Also, bond purchases under the bond purchase program were brought forward this week to assist with the smooth functioning of the market. The Bank is prepared to make further adjustments to its purchases in response to market conditions. To date, a cumulative $74 billion of government bonds issued by the Australian Government and the states and territories have been purchased under the initial $100 billion program. A further $100 billion will be purchased following the completion of the initial program and the Bank is prepared to do more if that is necessary. Authorised deposit-taking institutions have drawn $91 billion under the Term Funding Facility and have access to a further $94 billion. Since the start of 2020, the RBA's balance sheet has increased by around $175 billion.

The Board remains committed to maintaining highly supportive monetary conditions until its goals are achieved. The Board will not increase the cash rate until actual inflation is sustainably within the 2 to 3 per cent target range. For this to occur, wages growth will have to be materially higher than it is currently. This will require significant gains in employment and a return to a tight labour market. The Board does not expect these conditions to be met until 2024 at the earliest.
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Housing prices across Australia have increased recently: RBA Governor Philip Lowe's March 2021 meeting statement

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Despite the pressure of soaring property prices, the RBA have decided to keep the official cash rate on hold at the March 2021 meeting.

In his <a href="/expert-insights/finance/housing-prices-across-australia-have-increased-recently-rba-governor-philip-lowes-march-2021-meeting-statement">meeting minutes</a>, RBA Governor Philip Lowe said that lending rates for most borrowers are at record lows and housing prices across Australia have increased recently.

"Housing credit growth to owner-occupiers has picked up, but investor and business credit growth remain weak," Lowe said.

"Lending standards remain sound and it is important that they remain so in an environment of rising housing prices and low interest rates."

[smartcode_project:default project_id=30087]

Canstar’s group executive of financial services Steve Mickenbecker said the Reserve Bank looks likely to find itself under property price pressure a lot sooner than it had expected.

“The Reserve Bank doesn’t expect to raise the cash rate for three years or more, but unless property prices can be slowed it will have to start looking for some way to apply the brakes," Mickenbecker said.

"First home buyers and new construction are leading the charge for property buying rather than investors, so the Reserve Bank can’t enlist APRA to target investors with lending caps as it has done previously.”

Mickenbecker said it is the perfect storm for house prices.

"On the supply side, new listings through 2020 were well below the four preceding years and total listings now are also down as stock is absorbed before or as soon as properties hit the market. Owners are loath to put a house on the market even at high current prices, fearing they will miss the boat getting back in.

[smartcode_project:default project_id=6798]

<h2>Should lending be looked at?</h2>

Analysis of owner-occupier rates from RateCity.com.au and property prices from CoreLogic show mortgage repayments are $140 less a month for the average new home buyer than in the previous housing peak of October 2017.

This is because the average owner-occupier interest rate has dropped by 1.42 per cent in this time, according to the RateCity.com.au database.

RateCity.com.au research director Sally Tindall said that while the RBA is unlikely to raise rates to keep a lid on the market this year, the regulator could respond by putting caps on risky lending for some borrowers.

Finder.com.au's monthly RBA Cash Rate Survey found that a little over half of respondents agree that the removal of responsible lending regulations could lead to an unstable level of household debt across the country.

Peter Boehm of CLSA Premium said, “When interest rates start to rise, it is possible a mortgage arrears time bomb will be released.”

[smartcode_project:default project_id=27728]

On the other side of the argument, 45% of experts argue that the current regulations in place are too onerous and are hurting both borrower and lender.

Rich Harvey of Propertybuyer said those with the ability to borrow sustainably and with good employment history and serviceability should be able to borrow.  

“Stronger borrowers create a stronger economy as they help inject investment into other sectors of economy,” Harvey said.

Nicholas Gruen of Lateral Economics said it's a real hardship for some older Australians who are income poor but asset rich.

“The regulations are pretty silly now, requiring lenders to turn down plenty of viable lending,” Gruen said. 
 
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RBA holds interest rate at record low 0.1 per cent at March 2021 meeting

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At its meeting today, the Board decided to maintain the targets of 10 basis points for the cash rate and the yield on the 3-year Australian Government bond, as well as the parameters of the Term Funding Facility. It also decided to purchase an additional $100 billion of bonds issued by the Australian Government and states and territories when the current bond purchase program is completed in mid April. These additional purchases will be at the current rate of $5 billion a week.

The outlook for the global economy has improved over recent months due to the development of vaccines. While the path ahead is likely to remain bumpy and uneven, there are better prospects for a sustained recovery than there were a few months ago. That recovery, however, remains dependent on the health situation and on significant fiscal and monetary support. Inflation remains low and below central bank targets.

In Australia, the economic recovery is well under way and has been stronger than was earlier expected. There has been strong growth in employment and a welcome decline in the unemployment rate to 6.6 per cent. Retail spending has been strong and many of the households and businesses that had deferred loan repayments have now recommenced repayments. These outcomes have been underpinned by Australia's success on the health front and the very significant fiscal and monetary support.

The recovery is expected to continue, with the central scenario being for GDP to grow by 3½ per cent over both 2021 and 2022. GDP is now expected to return to its end-2019 level by the middle of this year. Even so, the economy is expected to operate with considerable spare capacity for some time to come. The unemployment rate remains higher than it has been for the past 2 decades and while it is expected to decline, the central scenario is for unemployment to be around 6 per cent at the end of this year and 5½ per cent at the end of 2022.

Wage and price pressures remain subdued. The CPI increased by just 0.9 over the year to the December quarter and wages (as measured by the Wage Price Index) are increasing at the slowest rate on record. Both inflation and wages growth are expected to pick up, but to do so only gradually, with both remaining below 2 per cent over the next couple of years. In underlying terms, inflation is expected to be 1¼ per cent over 2021 and 1½ per cent over 2022.

In addition to the central scenario, the Board considered upside and downside scenarios related to the virus and the rollout of vaccines. Disappointing news on the health front would delay the recovery and the expected progress on reducing unemployment. On the other hand, it is possible that further positive health outcomes would boost consumer spending and investment, leading to stronger growth than is currently expected. An important near-term issue is how households and businesses adjust to the tapering of some of the COVID support measures and to what extent they will use their stronger balance sheets to support spending.

Financial conditions remain highly accommodative, with lending rates for most borrowers at record lows and asset prices, including housing prices, mostly increasing. Housing credit growth to owner-occupiers has picked up recently, but investor and business credit growth remain weak. The exchange rate has appreciated and is in the upper end of the range of recent years.

The Board remains committed to maintaining highly supportive monetary conditions until its goals are achieved. Given the current outlook for inflation and jobs, this is still some way off. The current monetary policy settings are continuing to help the economy by lowering financing costs for borrowers, contributing to a lower exchange rate than otherwise, supporting the supply of credit needed for the recovery and supporting household and business balance sheets. The decision to extend the bond purchase program will ensure a continuation of this monetary support.

To date, authorised deposit-taking institutions have drawn $86 billion under the Term Funding Facility and have access to a further $99 billion. The Bank has bought a cumulative $52 billion of government bonds issued by the Australian Government and the states and territories under the bond purchase program. It has not purchased bonds in support of the 3-year yield target since early December. Since the start of 2020, the RBA's balance sheet has increased by around $160 billion.

The Board will not increase the cash rate until actual inflation is sustainably within the 2 to 3 per cent target range. For this to occur, wages growth will have to be materially higher than it is currently. This will require significant gains in employment and a return to a tight labour market. The Board does not expect these conditions to be met until 2024 at the earliest.
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No interest rate hike until at least 2024? RBA Governor Philip Lowe's February 2021 meeting statement

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At the RBA's December 2020 meeting, the members noted that conditions in the domestic housing market were improving, but were uneven.

"Regional housing prices had increased by more than those in capital cities since the onset of the pandemic", RBA Governor Philip Lowe's meeting minutes read.

They highlighted the variation in changes in housing prices across the capitals, with Sydney and Melbourne markets more subdued than elsewhere in the country.

Lowe said that, within Sydney and Melbourne in particular, conditions in the detached housing market were firmer than for higher-density markets.

"Overall, national housing prices had increased only a little since the outbreak of the pandemic," Lowe stated.

They focused on the slowdown in population growth impacting the housing market nationally as a result of the closure of international borders.

"This had been more consequential in Australia than in many other economies," Lowe advised, saying that it has impacted the rental market in particular, with rents falling and rental vacancy rates in inner-city Sydney and Melbourne around their highest levels in many years."

Lowe touched on the strong growth in New Zealand housing markets, with population growth, expat buying interest and an earlier easing in lending standards.

"By comparison, these factors had been less relevant in Australia and, partly as a result, the increase in housing prices in Australia this year had been considerably smaller than in a number of other advanced economies."
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Conditions in the domestic housing market improving, but uneven: RBA's December 2020 meeting minutes

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RBA Governor Philip Lowe has taken aim at banks’ lending practices and interest-only loans, while saying that in the long run only the supply of housing can address affordability. 
At a speech in Melbourne, Governor Lowe pulled up the lending practices of banks, saying “too many loans are still made where the borrower has the skinniest of income buffers after interest payments”.
“In some cases, lenders are assuming that people can live more frugally than in practice they can, leaving little buffer if things go wrong”. 
He justified the response of the Australian Prudential Regulation Authority that lenders can expect more scrutiny of loans with a very low net income surplus.
Last week, APRA clamped down on interest-only loans in a bid to cool the hot east coast property market, asking lenders to restrict interest-only loans to 30 per cent of new residential mortgage loans.
Interest-only lending represents nearly 40 per cent of residential mortgage lending by banks.
“Over the past year, close to 40 per cent of the housing loans made in Australia have not required the scheduled repayment of even one dollar of principal at least in the first years of the life of the loan; only interest payments are required. This is unusual by international standards,”  said Lowe.
“In some countries, repayment of at least some principal is required on all housing loans for the entire life of the loan. In other countries, interest-only loans are available only if the borrower has already contributed a fair degree of equity. So this is one area where Australia stands out. We are not unique in this area, but we are unusual.”
Last week, APRA Chairman Wayne Byres too had addressed the issue, saying “APRA views a higher proportion of interest-only lending in the current environment to be indicative of a higher risk profile.” 
While noting that the contrast in the housing markets of Melbourne and Sydney versus Perth and other regions, he said supply of housing hadn’t kept pace with Australia’s population growth and the result has been higher prices.
“Not surprisingly, the rising prices have encouraged people to buy residential property as an investment in the hope of ongoing capital gains,” said Lowe. 
“With global interest rates so low, many investors have found it attractive to borrow money to invest in appreciating residential property. This has reinforced the upward pressure on prices.” 
He said the rising indebtedness and rising housing prices was discussed at length by the Council of Financial Regulators because of the risk to the stability of our financial system. 
Although banks are soundly capitalised, he said the main concern was that the longer the recent trends continued, the greater the risk to the future health of the Australian economy. 
“Stretched balance sheets make for more volatility when things turn down.”
He said the flexible nature of Australian mortgages explain a high proportion of interest-only loans as also the taxation rules. 
“Many people with interest-only loans make significant payments into offset accounts rather than explicitly paying down principal. This flexibility, which is of value to many people, isn't available in most countries.
“A second factor is the taxation arrangements that apply to investment in residential property in Australia.”
APRA’s new measures restricting interest-only loans and strict limits on interest-only loans with high loan-to-valuation ratios, along with curbs on investor lending should help the whole system pull back to a more sustainable position. 
“A reduced reliance on interest-only loans in Australia would be a positive development and would help improve our resilience. With interest rates so low, now is a good time for us to move in this direction. Hopefully, the changes might encourage a few more people to think about the merit of taking out very large interest-only loans when interest rates are near historical lows.”
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