<p>Perth’s new apartment market recorded its strongest quarter of sales since Q4 2021, with 412 apartments sold in Q1 2026 and a record quarterly sold value of $537 million, according to Urbis’ latest Apartment Essentials results.</p>

<p>Urbis said the March quarter result reflects strong, highly product‑specific demand across both ends of the market, from more attainable projects delivering at scale, through to premium stock being absorbed by equity‑rich downsizers.&nbsp;</p>

<p>David Cresp, Partner at Urbis, said the key story in Perth is not demand, it is the market’s ability to convert demand into delivered housing.&nbsp;</p>

<p>“This is the strongest sales quarter since Q4 2021, and it reinforces that demand in Perth is real and it’s local,” David Cresp said. “But the task now is delivery, turning that demand into projects that can actually be built and completed.”&nbsp;</p>

<p>[smartcode_project:default project_id=110291 project_image_fid=302785]</p>

<h2>Affordable product leads, premium demand remains resilient</h2>

<p>Sales in Q1 were led by more affordable projects, with The Boulevard (SKS Group) recording 115 sales in the quarter, the presentation noting this is only the second time a single project has surpassed 100 quarterly sales. The project was able to offer more affordable housing product right next to a train station.&nbsp;</p>

<p>Palmyra West (Finbar) also delivered strong results with 28 sales in Q1, following 84 sales in Q4, with an average price of under $800,000, underscoring depth of demand for well‑located, attainable new stock.&nbsp;</p>

<p>At the premium end, Urbis said downsizer demand is continuing, with the results highlighting Romeo (Applecross, Finbar) recording 75 sales and reaching almost 50% sold in one quarter.</p>

<p>Jual (Shenton Park, Celsius Property) also posted a strong quarter with 28 sales, reaching 39% sold in one quarter.</p>

<p>Urbis noted that Perth apartment demand is not speculative, not investor‑led, and not uniform, describing it as localised, often equity‑driven and highly product‑specific, a pattern reflected in the polarisation between strong “attainable” performers and premium downsizer product.&nbsp;</p>

<p>[smartcode_project:default project_id=148957 project_image_fid=364102]</p>

<h2>Prices underpinned by costs, and the delivery risk is growing</h2>

<p>Urbis said pricing pressure is cost not demand‑driven: construction costs and delivery risk are now a central constraint, with the results noting build costs remain elevated and volatile, and that energy, fuel and labour uncertainty weigh on feasibility.</p>

<p>David Cresp said a growing challenge for private Build‑to‑Sell developers is simply securing a builder in the current environment.</p>

<p>“Developers are really feeling the pressure from a building market that was operating at capacity and securing a builder is challenging,” David Cresp said, adding that even where a builder can be secured, “trying to get to the price that makes the development financially viable is incredibly challenging in the current market.”&nbsp;</p>

<p>Urbis’ broader WA commentary also notes that industry remains at or above capacity with lot and housing creation, and that many builders are limiting new sales to manage stretched workforces and fixed‑price contract pressures, conditions that flow directly into apartment feasibility and delivery timing.</p>

<p>[smartcode_project:default project_id=108869 project_image_fid=317905]</p>

<h2>Supply: improving later, but still constrained, and Perth lags eastern benchmarks</h2>

<p>While near‑term supply remains constrained, Urbis’ forecast shows completions lifting “Supply is forecast to be back above 1,500 apartments per annum for the first time since 2019”, with 1,775 completions forecast for 2026, and volumes remaining above that level over the following years.&nbsp;</p>

<p>Looking further ahead, completions are forecast to reach 2,500 in 2028, with the report noting 32% of that total is social/affordable, reflecting the role of government‑supported delivery in rebuilding the pipeline.&nbsp;</p>

<p>However, Urbis said Perth remains behind comparable markets on pipeline scale. In a national comparison of projects under construction, the report shows under construction Perth Build‑to‑Sell (BTS) at 3,446 apartments versus the Gold Coast at 7,922. Mr Cresp said “The challenge for Perth is how to we grow the delivery pipeline”.</p>

<p>Urbis’ conclusion is that Perth’s market is increasingly defined by product discipline and delivery certainty, with the research identifying “delivery certainty is key” and calling out builder risk and procurement models as core success factors, alongside “timing and staging”.&nbsp;</p>


Joel Robinson

Perth apartment sales hit strongest pace since late 2021 as builder capacity tightens

<p><a href="https://www.apartments.com.au/developers/sammut-developments">Sammut Group</a> has secured development approval for its latest Brisbane apartment project, marking the Sydney developer’s next step in expanding its Queensland pipeline following the success of its debut Gold Coast development, Coast.</p>

<p>The approved project at <a href="https://www.apartments.com.au/new-apartments/44-glen-road-toowong-qld-4066">44 Glen Road, </a><a href="https://www.apartments.com.au/developments/toowong-qld-4066">Toowong</a> will deliver a 15-storey riverfront apartment building with 42 residences, significantly increasing the scale of the site’s previous approval for a smaller luxury scheme. Designed by Bureau^proberts, the development will comprise a mix of predominantly four-bedroom and two-bedroom apartments positioned to maximise Brisbane River and city views.</p>

<p>Sammut Director Julian Sammut said the group had been actively searching Brisbane for several years before identifying Toowong as the right fit.</p>

<p>“Brisbane was the right step for Sammut,” Sammut said.</p>

<p>“With the success of Coast we thought we should definitely look to do more in Queensland alone. We then pushed up to look at Brisbane. We've been looking for I'd say two to three years actually and it was hard to find the right location.”</p>

<p><img alt="Sammut makes Brisbane apartment play" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/f_auto,c_limit,w_1440,q_75/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/field/image/Screenshot%202025-12-23%20at%203.27.14%E2%80%AFPM.png?VersionId=dYAVIL7qdcGA8ojvkslSrLjczXFejSSx" /></p>

<p>Sammut said suburbs including New Farm and Teneriffe were considered before the group ultimately focused on Toowong due to its strong downsizer demographic and limited supply of developable riverfront land.</p>

<p>The site was acquired off-market after what Sammut described as a lengthy negotiation and planning process, with the developer pursuing an uplift to the original approval.</p>

<p>“We are DA approved now which is very exciting,” Sammut said.</p>

<p>“We've had our change approval come through and we've obviously doubled the height, 15 storeys plus rooftop. We've got 42 amazing apartments that are going to be coming to market soon.”</p>

<p><img alt="Sammut makes Brisbane apartment play" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,dpr_2.0,q_auto:good/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202025-12-23%20at%203.27.26%E2%80%AFPM.png?VersionId=ohkRkY0dIZlqdfME2EZePsCQavRiBadE" /></p>

<p>Bureau^proberts said the design responds to Toowong’s evolving urban character, balancing contemporary apartment living with the area’s established residential identity.</p>

<p>“A place where traditional Queensland living has taken place for centuries; Toowong is seeing a shift of contemporary influence, commercial and retail hubs mixed with well-considered residential offerings – all the while maintaining its character and charm,” the architect noted in planning documents submitted to Brisbane City Council.</p>

<p>The architecture practice said the project’s form was shaped by its riverfront setting, flood considerations, neighbouring building scales, and view corridors.</p>

<p>“They said the mix of four and two-bedroom apartments capture the ‘fundamental qualities of Queenslander living,’ translated into the context of a contemporary subtropical building.”</p>

<p>The development sits just off Coronation Drive within walking distance of Toowong’s retail precinct and the upgraded Regatta ferry terminal, while also benefiting from proximity to the incoming green bridge connection to West End. Sammut said the accessibility and amenity offering were central to the site’s appeal.</p>

<p>The approval adds to growing residential activity along the Toowong riverfront, joining nearby projects including Consolidated Properties’ Monarch Residences and Spyre Group’s ARC Residences.</p>


Sammut secures approval for debut Brisbane apartment development in Toowong

<p>Developer Lanevick is heading back into Sydney’s apartment market after focusing more heavily on the luxury townhouse and terrace sector in recent years.</p>

<p>Lanevick, founded and directed by Steve Maroun, is expecting to receive approval in the coming months for a new apartment development in Gladesville, with the aim to launch it to the market later this year.</p>

<p>The 51-apartment project, designed by Studio Johnston, will comprise a mix of one-, two-, and three-bedroom apartments positioned toward the Hunters Hill downsizer market.</p>

<p>“Traditionally it’s been difficult for people in that market to downsize because there just hasn’t been the right product available,” Maroun said.</p>

<p>“We’re targeting buyers who might have 30 to 40 per cent of their house value sitting in the bank after downsizing.</p>

<p>“They still want good spacious entertaining areas, they still want quality design, but they also want flexibility and the ability to enjoy life a bit more after working hard for a long time.”</p>

<p>The project sits near Boronia Park and within close proximity to the Parramatta River foreshore, an area Maroun says offers more of a Hunters Hill lifestyle than a traditional apartment precinct.</p>

<p>“From a lifestyle perspective, it’s really more Hunters Hill than Gladesville,” Maroun said. “You’re close to the foreshore, close to parklands, and still connected back into the village precinct.”</p>

<p>From level four and above, apartments will capture water views&nbsp;toward Sydney Harbour. Communal amenity will include rooftop entertaining areas, wellness spaces, and a gym tailored toward owner-occupier buyers.</p>

<p>“We’ve really designed these apartments around that buyer coming from the Hunters Hill LGA and what they’re actually looking for in their next chapter.”</p>

<p>The proposed development has also been designed to respond to the changing character of the broader Gladesville town centre, where a growing number of mixed-use and residential proposals are expected to emerge over the coming years.</p>

<p>“Gladesville presented a rare opportunity to deliver a genuinely design-led residential project within an evolving lifestyle precinct, just moments from the growing Gladesville town centre, and we’ve approached the project with a strong focus on architecture, liveability and long-term community value,” Maroun said.</p>

<p>Maroun said Lanevick saw a first-mover advantage within the precinct as planning controls continue to evolve to accommodate greater housing density.</p>

<p>“We think there’s a real opportunity there that hasn’t really been serviced properly yet,” he said.</p>

<p>“There’s going to be a broader evolution of the whole Gladesville village precinct over time, particularly with more activation and mixed-use outcomes.”</p>

<p>The Venus Street proposal will include a commercial and retail component at ground level designed to contribute to that evolving streetscape activation.</p>

<p>“A big part of the thinking was how do you activate that area properly and create more vibrancy and amenity, which is what Hunters Hill has been looking for,” Maroun said.</p>

<p>Lanevick’s focus since 2020 has largely been on smaller-scale luxury townhouse and terrace developments. The developer recently completed Royale Randwick, also designed by Studio Johnston, where prices reached $3.65 million. The project was featured in the UDIA NSW 2026 Professional Development Prospectus and was also named a finalist for Development of the Year.</p>

<p>&nbsp;</p>


Lanevick to cater for Hunters Hill downsizers with new Gladesville apartment development

<p>Property developer One Living, backed by former Macquarie banker turned investment manager Chris Green’s investment firm, has unveiled plans to bring more institutional capital into housing to help address the national supply crisis.</p>

<p>The New York-based investor has focused his firm, GreenPoint Partners, on addressing the supply shortage hitting middle market housing in Australia.</p>

<p>It is backing the new One Living business to develop more than 1000 units along the eastern seaboard. The new firm is starting with a development on Mona Vale Road, on the border of Mona Vale and Pymble, in Sydney’s Northern Beaches, with around 140 apartments planned. They are eyeing off more sites across the city.</p>

<p>With cost pressures rising in the industry, One Living’s model is to be a vertically integrated developer-builder, so it can respond directly to the housing gap by removing the cost inefficiencies embedded in traditional residential delivery.</p>

<p>“We are building a platform designed to operate at scale and starting in a market where there’s a clear need for quality, attainable housing,” One Living joint managing director Joseph Scuderi said.</p>

<p>“It’s that missing middle – it’s that attainable end of housing… that’s what most Australians invest into and what Australians can actually afford.”</p>

<p><img alt="Mona Vale" data-entity-type="file" data-entity-uuid="798dfa93-4941-4db6-a696-31e9dc18e81c" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-28%20at%202.31.50%E2%80%AFPM.png?VersionId=mKBqi5C_DmeiXS.AtJkcR8LQIxqCqmFi" /></p>

<p>GreenPoint Partners brings years of experience assembling and scaling real estate operating businesses across major markets. And Green sees a big opportunity in Australia.</p>

<p>“For its size, sophistication and importance to the community, Australia’s living sector has remained largely under-institutionalised, which represents significant opportunity,” Green said. “GreenPoint identified that gap, assembled the right team, and is backing One Living to build a platform that is aligned to market needs.”</p>

<p>Green said being a builder-developer would give the company the capacity and flexibility it required to deliver reasonably-priced homes.</p>

<p>“We want it to be at that attainable level; not super high end luxury but at that attainable level,” he said.</p>

<p><img alt="Mona Vale" data-entity-type="file" data-entity-uuid="74a5344a-4b26-4d4a-ada3-056b1220be77" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-28%20at%202.32.15%E2%80%AFPM.png?VersionId=vY8hXHO4reBMdO8ZXMWCNtGZJofUPQ3j" /></p>

<p>&nbsp;</p>

<p>One Living will undertake a component of affordable housing in its schemes, which it will own and operate, and it could also run build-to-rent on some sites.</p>

<p>Green praised local policy settings.</p>

<p>“The NSW government is being very supportive, strategic and pragmatic in terms of how do we generate more supply of housing,” he said. “We think it’s actually positive for development and the bit that’s been lacking at that attainable level is that it’s lots of relatively small private developers, whereas we want to create an institutional platform.”</p>

<p>One Living is also&nbsp;looking at high-density projects and could take on more institutional funding in the future.</p>

<p>“The way we will be able to achieve economies of scale is through size,” Green added.</p>


One Living enters Sydney's new apartment market with Northern Beaches site acquisition

<p>It's been several years since there's been an opportunity to buy a brand new townhome in Melbourne's coastal suburb of Mordialloc. Even apartment developments in recent times have been few and far between in the area.</p>

<p>Local developer LDS Property identified the gap in new housing, securing a site on White Street, directly opposite&nbsp;Woodlands Golf Club Mordialloc. They've recently launched&nbsp;<a href="https://www.apartments.com.au/new-townhouses/wm-residences-mordialloc-102-white-street-mordialloc-vic-3195">WM Residences</a>, just 13 townhouses which they have already started building.</p>

<p>Projects by Buxton Director Heath Thompson, who is selling WM Residences, says the townhouses x that perfect middle ground be</p>

<p data-end="683" data-start="511">"Mordialloc residents have had limited options to downsize within the suburb, often forcing them to look elsewhere despite long-standing ties to the area," Thompson says.</p>

<p data-end="882" data-start="690">"With very little comparable new supply coming to market, projects like WM Residences are well placed, particularly as buyers look to capitalise on current conditions amid constrained supply."</p>

<p data-end="882" data-start="690">[smartcode_project:default project_id=134646 project_image_fid=6109]</p>

<p>The development, designed by regarded architecture firm&nbsp;<a href="https://www.apartments.com.au/architects/ewert-leaf">Ewert Leaf</a>,&nbsp;adopts a deliberately restrained architectural approach, focusing on simplicity, durability and liveability rather than overt design gestures.</p>

<p>The boutique scale is central to the offering. With only 13 three-bedroom residences, each home is configured to prioritise functional layouts and everyday use, supported by private terraces and secure two-car garages.</p>

<p>Ewert Leaf’s design response leans into a calm, neutral material palette. Interiors are defined by oak flooring, white walls and soft finishes, creating a consistent and understated backdrop. The approach avoids trend-driven detailing in favour of longevity, with an emphasis on natural light and spatial clarity.</p>

<p>[smartcode_project:default project_id=134646 project_image_fid=6110]</p>

<p>Beyond aesthetics, the homes are designed to meet contemporary performance expectations. Each residence targets a minimum 6-star energy rating, incorporating double glazing, comprehensive insulation and all-electric Bosch appliances.</p>

<p>The project’s location supports a walkable coastal lifestyle, sitting within close proximity to Mordialloc’s foreshore, Main Street retail strip and the train station. Local cafés and dining venues, including Suburbia Deli and Hendriks Café, are within a short walk, reinforcing the area’s established neighbourhood character.</p>

<p>[smartcode_project:default project_id=134646 project_image_fid=6116]</p>

<p data-end="247" data-is-last-node="" data-is-only-node="" data-start="0">While <a href="https://www.apartments.com.au/developments/mordialloc-vic-3195">Mordialloc</a> is often defined by its beach and pier, the project taps into other areas of day to day living, offering easy access to local food, casual dining and transport, rather than positioning itself purely as a lifestyle retreat.</p>

<p>WM Residences reflects a continued trend across Melbourne’s coastal suburbs towards smaller-scale, design-led townhouse developments, particularly on infill sites where proximity to amenity is already established.</p>

<p>With construction commenced prior to its market entry, the project aligns with a growing preference among buyers for developments with visible progress and defined delivery timeframes.</p>

<p>[smartcode_project_cta:default project_id=134646]</p>


WM Residences fills gap in Mordialloc townhouse market

Population Growth

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<p>GUEST OBSERVER</p>
<p>Australia’s population is estimated to have clocked 24 million during the March quarter.</p>
<p>The annual growth rate has been tracking around 1.4 percent for the past six quarters. It is quite a bit lower than the pre-GFC boom years when population growth was running around 2.0 percent pa. But it remains high by OECD standards and is considered to be a strong pace.</p>
<p>Robust population growth means the economy needs to be expanding at a faster rate than otherwise to achieve full employment. That of course means that the economy has the capacity to expand at a faster rate too.</p>
<p>The slowdown in Australia’s population growth rate is a contributing factor to why most estimates of trend growth for the economy have been lowered in recent years – both Treasury and the RBA have lowered their estimates of trend growth to be in 2 3⁄4 to 3 percent range.</p>
<p>In the short run, however, the economy can expand  above that pace because; (i) the unemployment rate is above the non-accelerating inflation  rate of unemployment (NAIRU) and can move lower; and (ii) productivity in the resources sector will continue to lift as production comes on stream. </p>
<p><a href="/images/2016/09/27/Screen%20Shot%202016-09-27%20at%203.17.13%20PM.png" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/09/27/Screen%20Shot%202016-09-27%20at%203.17.13%20PM.png" alt=""></p>
<p>The major driver behind Australia’s population growth continues to be net overseas migration (NOM). However, its contribution to growth has come down over the past few years. Both sides of federal politics favour high levels of immigration to partially offset some of the effects from the ageing of the population. It also allows the economy to grow at a faster rate than would otherwise be the case which boosts aggregate demand. And it has significantly boosted demand for housing which flows through to higher prices. </p>
<p>The ‘grey army’ – those aged 65 and over – has continued to grow as a share of Australia’s population. The growth of this age cohort underpins the structural decline in labour force participation. The ageing of the population has increased the dependency ratio (the age-to-population ratio of those typically not in the labour force) which underpins the need for fiscal reform, particularly tax policy. </p>
<p>The detail</p>
<p>Australia’s population is estimated to have risen by 328k in QI (+0.4 percent). The lift takes the population to 24.1 million as at March 2016. NOM was 181k in the year to March 2016,  up from 177k in the year to March 2015. But well down from the peak of 315k in 2008. </p>
<p><a href="/images/2016/09/27/Screen%20Shot%202016-09-27%20at%203.18.28%20PM.png" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/09/27/Screen%20Shot%202016-09-27%20at%203.18.28%20PM.png" alt=""></p>
<p>Population growth is well above the national rate in Victoria. This underpins very strong employment growth in the Garden State, robust residential construction and strong State Final Demand (SFD). It does little for per capita SFD growth, however. The decline in mining investment and associated downturn in mining-related employment has contributed to a sharp slowdown in WA’s population growth rate. </p>
<p><a href="/images/2016/09/27/Screen%20Shot%202016-09-27%20at%203.21.03%20PM.png" target="_blank">Click to enlarge</a></p>
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<p><span>Table 1: Population growth </span><span>– </span><span>QI 2016 </span></p>
<p><span><img src="/images/2016/09/27/Screen%20Shot%202016-09-27%20at%203.21.03%20PM.png" alt=""></span></p>
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<p><em><span>Gareth Aird is e</span><span>conomist at Commonwealth Bank and can be contacted <a href="https://www.propertyobserver.com.au/https://au.linkedin.com/pub/gareth-aird/14/790/905" target="_blank">here</a>.</span></em></p>
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jchancellor-FAypfDUnLy

Australia clocked 24 million people in the March quarter: CBA's Gareth Aird

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<p><span style="font-size: 12.16px; line-height: 1.3em;">Due to fewer overseas migrants coming the population growth has continued to slow, according to the September.</span></p>
<p><a href="/images/2016/09/06/CoreLogic_Graphs/Screen%20Shot%202016-09-06%20at%201.29.37%20PM.png" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/09/06/CoreLogic_Graphs/Screen%20Shot%202016-09-06%20at%201.29.37%20PM.png" alt=""></p>
<p>There was a huge increase in housing approvals during July.</p>
<p><a href="/images/2016/09/06/CoreLogic_Graphs/Screen%20Shot%202016-09-06%20at%201.29.45%20PM.png" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/09/06/CoreLogic_Graphs/Screen%20Shot%202016-09-06%20at%201.29.45%20PM.png" alt=""></p>
<p><span style="font-size: 12.16px; line-height: 1.3em;">The gap between housing demand and supply continues to narrow.</span></p>
<p><a href="/images/2016/09/06/CoreLogic_Graphs/Screen%20Shot%202016-09-06%20at%201.30.01%20PM.png" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/09/06/CoreLogic_Graphs/Screen%20Shot%202016-09-06%20at%201.30.01%20PM.png" alt=""></p>
<p><span style="font-size: 12.16px; line-height: 1.3em;">The report suggested consumer feelings remains neutral to housing prices.</span></p>
<p><a href="/images/2016/09/06/CoreLogic_Graphs/Screen%20Shot%202016-09-06%20at%201.30.10%20PM.png" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/09/06/CoreLogic_Graphs/Screen%20Shot%202016-09-06%20at%201.30.10%20PM.png" alt=""></p>
<p>It noted the u<span style="font-size: 12.16px; line-height: 1.3em;">nemployment rate falls to 5.7 percent in July.</span></p>
<p><a href="/images/2016/09/06/CoreLogic_Graphs/Screen%20Shot%202016-09-06%20at%201.30.20%20PM.png" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/09/06/CoreLogic_Graphs/Screen%20Shot%202016-09-06%20at%201.30.20%20PM.png" alt=""></p>
<p><span style="font-size: 12.16px; line-height: 1.3em;">The official interest rate cut to a record low of 1.5 percent in August.</span></p>
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<p><img src="/images/2016/09/06/CoreLogic_Graphs/Screen%20Shot%202016-09-06%20at%201.30.29%20PM.png" alt=""></p>
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j.ballantyne1990-6AQqhLzZaK

CoreLogic's macroeconomic and demographic indicators of the Australian housing market

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<div>There was a slight increase in the number of permanent settlers in Australia in the year to June, according to today's ABS figures. </div>
<div> </div>
<div>Most come from Asia, at 58.4 per cent in the year to June.</div>
<div> </div>
<div>Only 410 Brit settlers arrived in the month of June - crashing down from a record 2,560 in August 2007 to the lowest figure in the history of the data series. </div>
<div> </div>
<div>Not so many Kiwis are making the permanent journey across the Tasman either right now.</div>
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<div><a href="/images/2016/08/05/A5.jpg" target="_blank">Click to enlarge</a></div>
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<div><img src="/images/2016/08/05/A5.jpg" alt=""></div>
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<div>With departures up over the past year, net permanent and long term immigration fell quite sharply to +262,800, the lowest figure since March 2007.</div>
<p><a href="/images/2016/08/05/A1.jpg" target="_blank">Click to enlarge</a></p>
<div class="separator"><img src="/images/2016/08/05/A1.jpg" alt=""></div>
<p> </p>
<div>It's another type of casualisation. </div>
<div> </div>
<div>Just as there are more part time jobs these days than there used to be, there are more part time migrants!<br><br>Despite the slowdown, as I explored here the headcount in Australia is probably up by more than 400,000 over the last year, including a surge in international students.</div>
<p><br><strong><span style="text-decoration: underline;">Record visitors</span></strong></p>
<div> </div>
<div>The lower dollar has resulted in an epic boom in short term arrivals, to yet another all-time high of 7.84 million.<br><br>And this figure is accelerating, up by 10 per cent over the past year. </div>
<div> </div>
<div>That said, the downward pressure impact of the lower dollar on short term departures (up to 9.67 million) may be beginning to fade. </div>
<p><a href="/images/2016/08/05/A3.jpg" target="_blank"> Click to enlarge</a></p>
<div class="separator"><img src="/images/2016/08/05/A3.jpg" alt=""></div>
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<div>Most short term visitors come for holidays (3.91 million) or to visit friends and relatives (2.04 million).</div>
<p><a href="/images/2016/08/05/A6.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/08/05/A6.jpg" alt=""></p>
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<div>No surprises that June saw yet another monthly record in the number of visitors from China and Hong Kong,</div>
<div> </div>
<div>There has been a stunning 21 per cent increase in annual visitors from China, Hong Kong, and Taiwan, to a record 1.54 million (a rip-snorting 13-fold increase from 1991). </div>
<p><a href="/images/2016/08/05/A4.jpg" target="_blank"> Click to enlarge</a></p>
<div class="separator"><img src="/images/2016/08/05/A4.jpg" alt=""></div>
<p><br><span>Meanwhile 469,800 education arrivals in the year to June was 14 per cent higher than one year ago.</span><br><br><a href="/images/2016/08/05/A2.jpg" target="_blank">Click to enlarge</a><br><img src="/images/2016/08/05/A2.jpg" alt=""></p>
<div>Recall that the visa rules for international students were relaxed effective 1 July, so these figures will likely accelerate in the second half of 2016.</div>
<p><strong><span style="text-decoration: underline;">The wrap</span></strong></p>
<div>As you were, really.</div>
<div> </div>
<div>Fewer long term and permanent migrants to Australia - particularly from the United Kingdom and New Zealand - but record short term arrivals and ever more Chinese visitors (with more to come when the changes to student visa rules kick in as the year progresses). </div>
<div> </div>
<div>
<p><span><em>PETE WARGENT is the co-founder of <a href="https://allenwargent.com/" target="_blank" rel="nofollow">AllenWargent</a> property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank" rel="nofollow">blogger</a>.</em><br></span></p>
<p><em>His latest book is <a href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx" target="_blank" rel="nofollow">Four Green Houses and a Red Hotel</a>.</em></p>
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pwargent-M4siyDbqQY

Record Chinese visitors again: Pete Wargent

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<p>Population figures in the Brisbane suburb of Chermside are expected to nearly double by 2036 with an annual population growth rate of 3.1 percent, 1 percent higher than the projected figure for greater Brisbane.</p>
<p>Forecasts from Resolution Research Strategists tip an increase of more than 8,500 residents between 2016 and 2036 in Chermside.</p>
<p>Resolution Research Strategists director Diane Howe said the growth can be attributed to a high level of connectivity with the CBD, major employment, health and education nodes.</p>
<p>"Chermside is one of the top performers in Brisbane's northern CBD and the population is tipped to reach more than 18,500 by 2036," she said.</p>
<p>"It's considered to be one of the biggest employment regions on Brisbane's northside with the Australian Tax Office, Prince Charles Hospital and other auxiliary hospitals and government departments based there. </p>
<p>"Employment figures are set to grow even more when the redevelopment of Westfield Shopping Centre is completed next year.”</p>
<p>360 Residential Project Marketing sales director Amanda Malady said there is a principle demand for apartment dwellings, particularly from professional workers, university students, young families and retirees.  </p>
<p>"Younger professionals are attracted to the area's proximity to major institutions, workplaces, retail infrastructure and the CBD,” she said.</p>
<p>“There's a 45 luxury apartment project in Woodstore, which is due for completion shortly and is already 95 percent sold.</p>
<p>“Harper on Hamilton (above), a 52 apartment project is due for completion mid 2017 and is 80 percent sold, whilst the boutique 23 apartment development Hallmarque, which is set to commence construction next month, is 85 percent sold.”</p>
<p>It is estimated Chermside has more than $154 million worth of residential building approvals underway.</p>
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Chermside tipped as one of Brisbane's fastest growing suburbs

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<p>GUEST OBSERVER</p>
<p>Population growth is bouncing of the slowest annual pace in almost 10 years.</p>
<p>If population is growing near 1.3 percent, we will need productivity growth near 1.7 percent to maintain the “speed limit” of the economy at 3 per cent. As the Reserve Bank has intimated, the speed limit of the economy has probably come down to a rate closer to 2.75 per cent.</p>
<p>Victoria is still the population leader. You have to go back to 1888 to find a time when Victoria held the position of the state with the fastest population growth. In fact population in Victoria is growing at the fastest pace in six years. In comparison Western Australia and South Australia have the weakest annual population growth rates in 12 and 11 years respectively. A result that resonates with the slowdown and weakness in the driven mining states. Only NSW and Victoria now have an annual population growth rate above long-term averages – important in absorbing the record amount of homes being built.</p>
<p><a href="/images/2016/06/24/Screen%20Shot%202016-06-24%20at%2010.14.31%20AM.png" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/06/24/Screen%20Shot%202016-06-24%20at%2010.14.31%20AM.png" alt=""></p>
<p>It is clear the labour market was the stellar performer over 2015. But there have been a number of signs that employment growth is now in the midst of a consolidation. Job advertisements have shown signs of consolidating in the past couple of months while the monthly employment statistics suggest employment growth has softened. Interestingly the data by industry provides a telling breakdown about where the jobs are being created. Over the three months to May employment grew by almost 47,000. Overall 10 of the 19 industry sectors recorded job gains in the past three months, with the hiring dominated by Healthcare &amp; social assistance, Wholesale trade and Accommodation &amp; food services.</p>
<p><a href="/images/2016/06/24/Screen%20Shot%202016-06-24%20at%2010.16.03%20AM.png" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/06/24/Screen%20Shot%202016-06-24%20at%2010.16.03%20AM.png" alt=""></p>
<p>Overall the labour market remains relatively upbeat. The lift in consumer confidence and business conditions should boost spending, investment and employment once the election is out of the way – a result that should see the jobless rate trend lower to 5.5 per cent by the end of this year.</p>
<p>  Healthcare remains the biggest employer and was also the biggest job creator over the past year. Interestingly Finance &amp; insurance, Construction and Retail were amongst the major employers over the past year – a result that resonates with the lift in activity across the economy.</p>
<p>What does the data show?</p>
<p>Industry employment:</p>
<p>Employment rose by 46,700 over the three months to May after a gain of 4,000 in the previous three months.</p>
<p>Over the past year employment lifted by 224,000 well above the decade average of 190,600.</p>
<p>Employment rose in 10 of the 19 industry sectors. Employment rose most in Health Care and Social Assistance (up 40,700), followed by Accommodation and Food Services (up 20,100) and Wholesale trade (up 17,500).</p>
<p>In the quarter, the number of jobs fell the most in Professional, Scientific and Technical Services (down 34,800), followed by Retail Trade (down 21,900), and Administrative and Support Services (down 18,800).</p>
<p>Healthcare remains the biggest employer with 1.6 million employees (13 per cent of the total) followed by Retail Trade (1.3 million jobs or 10.5 per cent) and Construction (1.08 million or 9.1 per cent).</p>
<p>Population Statistics: </p>
<p>Australia’s population expanded by 326,100 people over the year to December 2015 to 23,940,300 people.</p>
<p>Overall, Australia’s population growth rate rose from a 10-year low of 1.36 per cent to 1.38 per cent.</p>
<p>Australia’s population grew by just 71,300 people over the December quarter – the weakest quarterly result in 41⁄2-years.</p>
<p>A total of 177,000 people migrated to Australia over year to December, well down on the 315,700 peak migrants in the year to December 2008.</p>
<p>There were 305,300 babies born in the past year, just shy of the record 312,200 births in the year to December 2012.</p>
<p>Over the past year population growth was the strongest in Victoria (1.87 per cent – the fastest growth in 6 years), followed by NSW (1.40 per cent), the ACT (1.36 per cent), Queensland (1.26 per cent), Western Australia (1.20 per cent – weakest in almost 13 years), South Australia (0.66 per cent –weakest in 11 years), Tasmania (0.41 per cent) and the Northern Territory (0.35 per cent).</p>
<p>Population growth is above decade averages in NSW (7 per cent) and Victoria (5.6 per cent).</p>
<p><a href="/images/2016/06/24/Screen%20Shot%202016-06-24%20at%2010.18.45%20AM.png" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/06/24/Screen%20Shot%202016-06-24%20at%2010.18.45%20AM.png" alt=""></p>
<p>What is the importance of the report?</p>
<p>Demographic Statistics are issued by the Bureau of Statistics each quarter. The figures include estimates of births, deaths, in-bound and out-bound migration movements and estimates of population change by State.</p>
<p>The Australian Bureau of Statistics (ABS) provides detailed labour market figures one week after releasing ‘top level’ statistics of employment &amp; unemployment levels across states and territories. The detailed data is useful in identifying broader underlying trends and instructive about the health of the economy. </p>
<p>What are the implications for interest rates and investors?</p>
<p>The latest data has few implications for interest rate settings. But if population growth remains soft, the Reserve Bank may need to make further adjustments to economic growth assumptions.</p>
<p>CommSec expects the Reserve Bank to cut interest rates again in August. </p>
<p><em>Savanth Sebastian is an economist for <a href="https://www.commsec.com.au/" target="_blank">CommSec</a>.</em></p>
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Baby boom; Healthcare leads hiring: CommSec's Savanth Sebastian

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<div>The government's State of Australian Cities report for 2015 revealed some interesting demographic and social trends.</div>
<div> </div>
<div>The report found that population growth in recent years is becoming increasingly capital city focussed over time, and this is projected to become even more so the case over the next five decades.</div>
<p><a href="/images/2016/05/23/A1.jpg" target="_blank">Click to enlarge</a></p>
<div class="separator"><img src="/images/2016/05/23/A1.jpg" alt=""></div>
<p> </p>
<div>In fact, just the four most populous capital cities plus Gold Coast, Sunshine Coast and a handful of other conurbations have accounted for the overwhelming bulk of population growth. </div>
<div> </div>
<div class="separator"><a href="/images/2016/05/23/A2.jpg" target="_blank">Click to enlarge</a></div>
<div class="separator"><img src="/images/2016/05/23/A2.jpg" alt=""></div>
<div class="separator"> </div>
<div>The other cities and "peri-urban locations" which experienced some population growth were as follows:</div>
<div> </div>
<div class="separator"><a href="/images/2016/05/23/A3.jpg" target="_blank">Click to enlarge</a></div>
<div class="separator"><img src="/images/2016/05/23/A3.jpg" alt=""></div>
<p> </p>
<div>Projecting trends forward, the government expects the capital city share of population growth to continue increasing relentlessly for the next half century, from about two thirds to more than 80 per cent by 2061:</div>
<div> </div>
<div><em>"The majority of Australia's future population growth is expected to occur in and around its capital cities...Australia's population living in capital cities will more than double by 2061".</em></div>
<p><a href="/images/2016/05/23/A4.jpg" target="_blank">Click to enlarge</a> </p>
<p><img src="/images/2016/05/23/A4.jpg" alt=""></p>
<div>The projections show population growth expanding rapidly so that by 2061 several capital cities will have become very large indeed, including Sydney (8.5 million), Melbourne (8.6 million), Brisbane (5.8 million), and Perth (5.5 million).  </div>
<div> </div>
<div>By contrast the respective populations of the smaller cities aren't expected to change all that much in absolute terms. </div>
<p><a href="/images/2016/05/23/A5.jpg" target="_blank"> Click to enlarge</a></p>
<div class="separator"><img src="/images/2016/05/23/A5.jpg" alt=""></div>
<p><br><strong><span style="text-decoration: underline;">House price trends</span></strong></p>
<div>The State of Australian Cities report notes that for regional cities "overall house prices have not recovered strongly since the financial crisis".</div>
<div> </div>
<div>This mirrors quite closely what we have seen in Britain, with house prices rising strongly almost everywhere due to a debt binge broadly from around 2000 to 2008, in Australia's case spurred on by a once-in-a-century mining boom. </div>
<div> </div>
<div>But in most regional markets a long period of stagnation has followed since. </div>
<div> </div>
<div>You don't really need data series to demonstrate this point - just read the personal experiences of property investors on chat forums and their collective frustration is more than evident. </div>
<p><a href="/images/2016/05/23/a6.jpg" target="_blank">Click to enlarge</a></p>
<div class="separator"><img src="/images/2016/05/23/a6.jpg" alt=""></div>
<p> </p>
<div>It's been fairly well documented that house price growth has been strong in the largest capital cities, but house price growth has been far from uniform even within the larger capitals. </div>
<div> </div>
<div>Research conducted on behalf of the Valuer General concluded that price growth continues to be considerably stronger in the suburbs located close to the Central Business District. </div>
<div> </div>
<div><a href="/images/2016/05/23/a7.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/05/23/a7.jpg" alt=""></div>
<p><span>Indeed, research papers by the </span>Reserve Bank of Australia<span> (RBA), </span>AHURI<span> and others have all arrived at the same conclusion.</span> </p>
<div>Concludes the government report:</div>
<div> </div>
<div><em>"Inner urban regions and municipalities such as the Boorondara, inner, northern and eastern statistical districts and the inner Melbourne districts are pulling away from price growth rates of the middle and outer ring regions. </em></div>
<div><em> </em></div>
<div><em>The differences mean residents of outer urban regions are likely to be increasingly constrained in their ability to move to inner regions."</em></div>
<p><a href="/images/2016/05/23/A8.jpg" target="_blank"> Click to enlarge</a></p>
<div class="separator"><img src="/images/2016/05/23/A8.jpg" alt=""></div>
<div class="separator"> </div>
<div class="separator">
<p><span><em>PETE WARGENT is the co-founder of <a href="https://allenwargent.com/" target="_blank" rel="nofollow">AllenWargent</a> property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank" rel="nofollow">blogger</a>.</em><br></span></p>
<p><em>His latest book is <a href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx" target="_blank" rel="nofollow">Four Green Houses and a Red Hotel</a>.</em></p>
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Non-capital house prices have not recovered strongly since the financial crisis: Pete Wargent 

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<div><span style="line-height: 1.3em;">It's very much true that monthly figures often don't tell you a lot, and even annual figures are often quite misleading. </span></div>
<div> </div>
<div>But over a period of years now we have seen Melbourne come to utterly dominate population and employment growth in Victoria, directly at the expense of the state's regional centres. </div>
<div> </div>
<div>Over the past year Greater Sydney (+67,200) and Greater Melbourne (+59,700) have both added a healthy balance to their total employed figures respectively, while Greater Brisbane added a solid (+34,900). <br><br>And after some years of stagnation regional New South Wales (+60,900) has now at last come to the party, adding jobs in the state's regional centres both to the north and south of the harbour city. </div>
<div> </div>
<div>However, mirroring what I already discussed in more detail here when analysing the latest population growth figures, regional Victoria added just 900 jobs over the year. </div>
<div> </div>
<div>In fact, if you strip out Geelong which added nearly 20,000 jobs over the year to March 2016 to see its unemployment rate fall to just 5.2 per cent, the rest of state has been going backwards as Greater Melbourne powers along. The most recently available population growth figures painted a very similar picture.</div>
<p><a href="/images/2016/04/26/A1.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/04/26/A1.jpg" alt=""></p>
<div class="separator"> </div>
<div class="separator">It is true that annual figures can sometimes be misleading, but population and employment projections are becoming increasingly lopsided towards the capital city in Victoria to the extent that regional Victoria could actually soon even soon be seeing its population decline in aggregate.</div>
<div class="separator"> </div>
<div class="separator">In fact, regional employment growth has been generally very weak in aggregate across all states outside of the Premier State, despite some tourism-related gains in Queensland's coastal regions. </div>
<div class="separator"> </div>
<div class="separator">Regional employment fell year-on-year, for example, in both South Australia (-900) and Western Australia (-15,900), the latter's labour force having been severely dampened by the end of the mining construction boom. </div>
<div class="separator"> </div>
<div class="separator"><a href="/images/2016/04/26/A3.jpg" target="_blank">Click to enlarge</a></div>
<div class="separator"><img src="/images/2016/04/26/A3.jpg" alt=""></div>
<div><span style="text-decoration: underline;"> </span></div>
<div>Totting it all up we can see just how skewed employment growth has been towards a few capital cities, and certain parts of regional Queensland. </div>
<div> </div>
<div><a href="/images/2016/04/26/A4.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/04/26/A4.jpg" alt=""></div>
<p><br><strong><span style="text-decoration: underline;">Unemployment rates</span></strong></p>
<div> </div>
<div>Low interest rates are working their magic in the three largest capital cities where rolling annual unemployment rates are having been trending down nicely, in Greater Sydney, in Greater Melbourne, and in Greater Brisbane. </div>
<div>
<br>Elsewhere it's not such a pretty picture, particularly in Adelaide which now has by far and away the highest unemployment rate of the capital cities. <br><br>Greater Perth's rolling annual unemployment rate now seems to be holding firm at just under 6 per cent.</div>
<div> </div>
<div><a href="/images/2016/04/26/A2.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/04/26/A2.jpg" alt=""></div>
<p> </p>
<div>Sydney continues to have the best placed economy, reflected in generally low unemployment rates, especially in its inner suburbs. </div>
<p><a href="/images/2016/04/26/A5.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/04/26/A5.jpg" alt=""></p>
<div>
<strong><span style="text-decoration: underline;">Ripple</span></strong><br><br>Sydney and to a somewhat lesser extent Melbourne have seen their property markets take off since 2012 in response to low interest rates, but where will that growth ripple to next?</div>
<div> </div>
<div>In my opinion, we could easily see a spike or "pop" in house prices in Hobart and Adelaide, following so many years of subdued property price growth and a relatively moribund construction industry which has seen rental markets become fairly tight in some cases. <br><br>In fact, this "pop" in prices may already be happening to some extent.<br><br>
</div>
<div>However, with low employment growth, slow population growth, and slow economic growth, more sustainable property price increases will be much harder to come by. </div>
<p><a href="/images/2016/04/26/A6.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/04/26/A6.jpg" alt=""></p>
<div> </div>
<div>Over the course of the next cycle, Brisbane probably has the best property market prospects due its relative affordability. <br><br>Despite slower net overseas migration than it previously experienced Queensland benefits from interstate migration (as opposed to, say, South Australia, where a brain drain represents the opposite dynamic). </div>
<div> </div>
<div>The unemployment rate has also steadily been trending down in Brisbane, helped by a construction boom. </div>
<div> </div>
<div>True, the economy has hardly been firing, even if things are broadly tracking in the right direction.</div>
<div> </div>
<div>But the initial trigger for rising property prices is simply likely to be rising property prices, with the cheapest available cost of borrowing having not far off halved since the last time the city saw any price growth in real terms, and interstate investors struggling to see so much value elsewhere. </div>
<div> </div>
<div>In fact, dwelling prices are already rising quite fast in some areas of Brisbane, reflected in year-on-year median price growth of above +6 per cent for Brisbane and Gold Coast (CoreLogic-RP Data), but the market is quite multi-speed, particularly with the volume of construction going on. </div>
<p><a href="https://2.bp.blogspot.com/-Em9By-I0i7E/VxhOPe0ZmWI/AAAAAAAAckc/ql1Vmw8Js-IJMMVaMVo-FmCGOrCcGTFcgCLcB/s1600/A7.jpg" target="_blank"> Click to enlarge</a></p>
<div class="separator"><a href="https://2.bp.blogspot.com/-Em9By-I0i7E/VxhOPe0ZmWI/AAAAAAAAckc/ql1Vmw8Js-IJMMVaMVo-FmCGOrCcGTFcgCLcB/s1600/A7.jpg"><img src="https://2.bp.blogspot.com/-Em9By-I0i7E/VxhOPe0ZmWI/AAAAAAAAckc/ql1Vmw8Js-IJMMVaMVo-FmCGOrCcGTFcgCLcB/s640/A7.jpg" width="640" height="356"></a></div>
<p> </p>
<div><strong><span style="text-decoration: underline;">Regional headwinds</span></strong></div>
<div> </div>
<div>Brisbane offers something that Sydney and Melbourne no longer do, being cheap entry prices. </div>
<div> </div>
<div>And if you're looking for cheaper entry prices still and higher initial rental yields you may be tempted further afield.</div>
<div> </div>
<div>However, remember that yield and income are not the same thing, and in the field of investment a higher yield can often be reflective of higher risk. </div>
<div> </div>
<div>In particular a once-in-a-century commodities and resources construction boom must eventually experience a corresponding decline, and so regions with a concentrated exposure to a narrow range of industries may see a spike in unemployment, which tends to result in slowing population growth, falling property prices, and rising vacancy rates (which is the ultimate risk for leveraged investors).</div>
<div> </div>
<div>I don't know much about how Townsville's property market is tracking lately, but do note that unemployment just hit its highest level in 13 years this month after the commencement of the Yabulu lay-offs. </div>
<div> </div>
<div>Granted monthly unemployment readings at the sub-regional level are incredibly seasonal and are about as reliable as a beat up Datsun. But this is not a coincidental result with Townsville having witnessed nearly 10,000 jobs lost in just the past year alone, the high profile Nickel industry closure being the latest casualties of the bust.</div>
<div> </div>
<div>The latest ABS figures record some 13,100 unemployed persons in Townsville, the highest since a brief spike in February 2003 for the most troubling regional unemployment rate in Australia at 12.4 per cent. </div>
<div> </div>
<div><a href="/images/2016/04/26/B1.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/04/26/B1.jpg" alt=""></div>
<div class="separator"> </div>
<div>These types of trends tend to be reflected in rising vacancy rates as population growth dries up. </div>
<div> </div>
<div>It never pays to over-dramatize, but Warwick Powell (to my knowledge not a man prone to making wildly exaggerated statements) said recently that "the region is on the precipice of a great depression", while economist Colin Dwyer lamented that Townsville is "the insolvency capital of Australia". </div>
<div> </div>
<div>The ABS data shows that employment in Townsville has fallen by an extraordinary 20,342 or 18 per cent in only the past year. Let's hope to goodness that is a rogue figure, but it doesn't much look like it from the trend. </div>
<div> </div>
<div>
<p><span><em>PETE WARGENT is the co-founder of <a href="https://allenwargent.com/" target="_blank" rel="nofollow">AllenWargent</a> property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank" rel="nofollow">blogger</a>.</em><br></span></p>
<p><em>His latest book is <a href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx" target="_blank" rel="nofollow">Four Green Houses and a Red Hotel</a>.</em></p>
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Townsville unemployment at 13 year high: Pete Wargent

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<p> </p>
<p><img src="https://counter.theconversation.edu.au/content/57114/count.gif" alt="The Conversation" width="1" height="1"></p>
<p>GUEST OBSERVER</p>
<p>We live in a global age of cities. Australia’s major urban regions are <span>expanding rapidly</span>. Melbourne took in a further 91,600 residents in 2014-15, giving an annual growth rate of 2.1 percent. It’s one of the fastest-growing cities in the developed world.</p>
<p><span>Australia’s other large cities also grew quickly in the past year – Sydney at 1.7 percent and Perth and Brisbane at 1.6 percent. Together the five largest cities added more than 250,000 residents in 2014-15. Projected over the next decade, that’s 2.5 million, the equivalent of adding an extra Brisbane.</span></p>
<p><span>Behind the gloss of ‘liveability’</span></p>
<p><span>In providing for the well-being of the next three million urban Australians, we need to take unvarnished stock of our situation. Australia’s cities have a reputation for being highly liveable, but such <span>corporate metrics obscure many malign facets</span>.</span></p>
<p><span>After three decades of market-driven urbanisation, our cities have become <span>engines of social inequality</span>. The rich have been lifted, inflating housing markets and capturing sites with the best government services and infrastructure and near to high-paid jobs. The poor are <span>displaced to cheaper distant sites</span> where employment, infrastructure and services are lean.</span></p>
<p><span>Our cities are socially divided. We’re doing little to redress these failures.</span><span style="line-height: 1.3em;"> </span></p>
<p><span>Our cities are also machines for <span>environmental degradation and climate change</span>. Buildings and transport systems are overwhelmingly powered by fossil fuels. Expanding fringes continue to consume vulnerable habitats and <span>precious agricultural land</span>. Even <span>infill development adds to urban land-clearing</span> as backyard trees are bulldozed for townhouses and apartments.</span></p>
<p><span>We run our urban systems so that every new resident <span>adds to environmental harm</span>. We need to decouple urban growth from environmental loss.</span></p>
<p><span>We waste public resources on grand transport infrastructure for individual private motor vehicles. Our <span>neglected public transport networks</span> either struggle to meet demand, or are absent and so mire whole communities in costly car dependence. Car parking – ubiquitous, spatially hungry and inefficiently underpriced – consumes valuable urban space.</span></p>
<p><span>Our governance arrangements are mismatched to the scale of our urban problems. Financing arrangements favour the federal government, an absent actor in urban policy, save for election campaigns when infrastructure baubles are showered from on high. Meanwhile states struggle with their urban service responsibilities.</span></p>
<p><span>None of our cities have democratic processes that operate at the level of whole metropolitan areas. Brisbane comes close but is only one council among ten in the urbanised southeast Queensland region.</span></p>
<p><span>We urgently need to move beyond our failed model of urbanisation and development.</span></p>
<p><span>A fourth phase of urban growth?</span></p>
<p><span>Australian cities began as congested 19th-century administrative port towns. As the problems of housing and poverty emerged, we spent the 20th century suburbanising our cities. Via post-WWII reconstruction, we solved housing deficits with new residential suburbs linked to nearby manufacturing as a model of public welfare.</span></p>
<p><span>A third phase of urbanisation emerged in the 1980s as we offshored manufacturing. Our cities were reworked to the dictates of global capital by reorienting our inner-urban industrial cores around symbolic work and leisure complexes while deregulating planning and privatising infrastructure.</span></p>
<p><span>We began to infill our cities, but in a haphazard way, missing many of the assumed gains from consolidation. The reliance on markets has only added to our urban woes by reducing democratic influence on urban decisions.</span></p>
<p><span>With the failures of past planning now apparent, the unruly threat of a damaged and depleting planet is ushering us toward a fourth era of urban restructuring. What urban futures await? What might “City v4.0” look like?</span></p>
<p><span>Priorities for 21st-century cities</span></p>
<p><span>The problems are vast and complex, but here are some brief starting points.</span></p>
<p><span>The first big task for City v4.0 is rapid and radical <span>decarbonisation of our urban systems</span> to reduce our outsized consumption of planetary resources. We need to urgently reduce the use of fossil-fuelled automobiles by shifting to public transport and active travel modes.</span></p>
<p><span>Transport decarbonisation can be achieved by a combination of registration costs, road user charging, road space removal and expansion of public transport, though necessarily calibrated around progressive cost structures to avoid social harms. Walking and cycling, the cheapest and most sustainable modes, need an order-of-magnitude leap in the funding and support they enjoy.</span></p>
<p><span>We can’t wait for electric cars to be adopted en masse. That prospect is still decades away <span>if it can be achieved at all</span>. Electric cars are largely the preserve of the affluent. They offer little respite to poorer households driving older and less efficient fossil fuel cars across vast suburban distances.</span></p>
<p><span>We need to ensure decarbonisation is done inclusively rather than adding another axis of social division. It also means ditching most of our transport cost-benefit analyses which ignore environmental and social costs.</span></p>
<p><span>We need to resocialise our cities. Social disparities are hard to redress once entrenched, so that effort must start immediately. The first task is to achieve more even distribution of high-quality jobs, services and infrastructure across our cities so location does not equate to opportunity. This will require a mix of investment, active government planning and new revenue-raising models to fund better urban services.</span></p>
<p><span>We need <span>comprehensive and progressive land taxes</span> across our cities. These would draw revenue from the inflationary gains made in property markets during recent decades – which favour the wealthy – and redirect them to public purposes. Taxing higher-value service-rich inner properties, for example, to fund redress of suburban service and infrastructure deficits is an urgent urban reform for more inclusive, equitable cities.</span></p>
<p><span>Perhaps some land-tax revenue could go to rebuilding our degraded public housing stock. This has <span>declined as a proportion of all dwellings</span> in recent years.</span></p>
<p><span>Further mechanisms, like inclusionary zoning, to make our cities more inclusive and productive via more affordable housing are urgently needed. Removing minimum car-parking standards for <span>infill developments</span> could improve housing affordability and support sustainable transport.</span></p>
<p><span>Our cities need comprehensive plans to ensure urban land-clearing from infill development does not leave them overheated, stale and brown. Around half of all urban vegetation is on private land, so we need arrangements to preserve and extend green space. Converting underutilised road space to parks or biodiversity corridors has multiple benefits and should be widely adopted.</span></p>
<p><span>New paradigms of planning and governance</span><span style="line-height: 1.3em;"> </span></p>
<p><span>A further opportunity, though rarely discussed, is to reactivate our <span>lost capacity for regional planning</span>. Population growth in the major cities should be discouraged in favour of regional centres.</span></p>
<p><span>And we need to see our major cities not just as individual primate cities but as networked city-regions. That would entail co-ordinated planning effort to better distribute new population, backed by active facilitation of employment and service investment. This would involve much faster trains than the puffing billies that currently serve our regional cities.</span></p>
<p><span>Lastly, our <span>governance arrangements need urgent reorganisation</span> to embed democracy at the meaningful level of the metropolitan area. This would provide a tangible and accessible middle tier between the incapacities of local governments and the general duties of state governments. Metropolitan plans with a clear democratic foundation and enabled by a clear fiscal base should be a priority for urban democratic improvement.</span></p>
<p><span>Nationally, we need better co-ordination of policies and funding between the federal government, which controls immigration and taxation, and lower tiers such as the states, which have all urban service responsibilities. Introducing a spatial perspective into all domestic federal policy to understand how federal actions impact cities and their regions would improve policy performance.</span></p>
<p><span>As a migrant country with a high rate of population growth, Australia takes people from less environmentally damaging nations and cities and, through our inefficient and degraded urban systems, turns them into some of the worst planetary consumers in the world. There seems little appetite for limiting immigration, nor is stopping urban population growth feasible.</span></p>
<p><span>So in an era of global urban transformation, we urgently need to change how we manage, build and grow our cities to version 4.0 so every additional resident enhances, rather than detracts from, the liveability, environmental sustainability and prosperity of our cities.</span></p>
<p><em><span class="fn author-name">Jago Dodson is </span><span style="line-height: 1.3em;">professor of Urban Policy and Director, Centre for Urban Research, RMIT University and author for The Conversation. He can be contacted <a href="https://theconversation.com/profiles/jago-dodson-2359" target="_blank">here</a>.</span></em></p>
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City v4.0, a new model of urban growth and governance for Australia

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<div><span>Sadly an inevitable consequence of the internet age for investors has been a focus on shorter and shorter timeframes. </span></div>
<div><span><br>While extra frequency of analysis can be interesting and fun, for most investors the best results will be secured by seeing the big picture and building a long term plan around it, particularly so in property investment which is ideally suited to a longer time horizon.</span></div>
<div><span> </span></div>
<div>When it comes to population and demographic projections, there are certainly plenty of cranks making forecasts, but if you're going to pay attention to any of them, then bugrudgingly it's got to be the cranks that determine policy. </div>
<div> </div>
<div>Over the short term to June 2019, the drivers of a rebound population growth from net overseas migration are clear enough, at least according to the latest available figures from the Department of Immmigration and Border Protection (DIBP). </div>
<div> </div>
<div><a href="/images/2016/01/11/A5.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/01/11/A5.jpg" alt=""></div>
<div> </div>
<div>
<div><strong><span style="text-decoration: underline;">But what about for the longer term?</span></strong></div>
<div> </div>
<div>It is often said that infrastructure investment is a key driver of property price growth, and this can certainly be the case whereby the multiplier effect of new projects generate economic activity, while infrastructure can also make certain suburbs a more appealing prospect. </div>
<div> </div>
<div>Of course, we have just been through a once-in-a-century resources investment boom, which temporarily caused a spike in dwelling prices in some towns, before they <a href="https://www.smartpropertyinvestment.com.au/news/14137-6-mining-towns-go-from-boom-to-bust" target="_blank">crashed</a> again as supply responded and contractors skipped town. </div>
<div> </div>
<div>Infrastructure investment is evidently only one part of the puzzle, and it needs to be coupled with a strong and sustainable growth in population, economic activity, and household wealth. I'd further add land supply constraints to that. </div>
<div> </div>
<div>In this context I took another read of Infrastructure Australia's latest estimates and projections, so let's take a 60-second look at what they say. </div>
<div> </div>
<div><strong><span style="text-decoration: underline;">"Population a key driver of economic growth" </span></strong></div>
<div> </div>
<div>The "three Ps" model of economic growth applied by the Australian Treasury has population growth at its very core: </div>
<div> </div>
<div><a href="/images/2016/01/11/B1.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/01/11/B1.jpg" alt=""></div>
<div> </div>
<div>
<div>In the 2015 Intergenerational Report population growth was assumed to drive for <strong><span style="text-decoration: underline;">almost half</span></strong> of the projected economic growth, measured in real Gross Domestic Product (GDP), over the next four decades.</div>
<div> </div>
<div><span>Projected population figures quoted in April 2015 by the Infrastructure Australia audit background paper were somewhat higher than the equivalent figures released in 2008, and tend to mirror previous projections by the Australian Bureau of Statistics reasonably closely. </span></div>
<div><span> </span></div>
<div>Notably, it is clearly articulated that state governments are planning for their capital cities to continue taking on a continually greater share of the state's population, particularly in the most populous states.</div>
<div> </div>
<div><a href="/images/2016/01/11/B2.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/01/11/B2.jpg" alt=""></div>
<div> </div>
<div><span>As such, going forward an ever greater share of the actual population growth must correspondingly take place in the capital cities, as confirmed by the projections. </span></div>
<div><span> </span></div>
<div><a href="/images/2016/01/11/B3.jpg" target="_blank"><span>Click to enlarge</span></a></div>
<div><span><img src="/images/2016/01/11/B3.jpg" alt=""></span></div>
<div> </div>
<div> </div>
<div>
<div><span>These are telling numbers indeed, but for mine it's the texture provided by the Government that is the really interesting bit:</span></div>
<div><span> </span></div>
<div><span>"Population growth is likely to have its greatest impact in Australia’s cities. Around the globe, cities are increasing their share of national population. Australia is already one of the most urbanised countries in the world. It would be unusual – if not remarkable – if Australia were to chart a materially different path from its past (or where the world is heading), at least over the next 15 years or so."</span></div>
<div><span> </span></div>
<div><strong><span style="text-decoration: underline;"><span>Looking forward</span></span></strong></div>
<div><span> </span></div>
<div><span>On the medium level projections, by 2031 Australia’s capital cities will be home to 6.4 million extra people (around 43.4 per cent more than 2011). The growth to 2061 (15.7 million persons) is around 1 million persons more than the current combined population of all of Australia’s capital cities.</span></div>
<div><span> </span></div>
<div><span>Note in particular the enormous projected growth in Greater Sydney, Melbourne, Brisbane, and Perth respectively (click to enlarge).</span></div>
<div><span> </span></div>
<div><a href="/images/2016/01/11/A4.jpg" target="_blank"><span>Click to enlarge</span></a></div>
<div><span><img src="/images/2016/01/11/A4.jpg" alt=""></span></div>
<div> </div>
<div> </div>
<div><span>Or looked at graphically.</span></div>
<div><span> </span></div>
<div><a href="/images/2016/01/11/A3.jpg" target="_blank"><span>Click to enlarge</span></a></div>
<div><span><img src="/images/2016/01/11/A3.jpg" alt=""></span></div>
<div> </div>
<div> </div>
<div><span>Looked at another way, the gradients of capital city projections show how the four largest cities are expected to garner the great bulk of the projected growth in population.</span></div>
<div><span> </span></div>
<div><a href="/images/2016/01/11/A5-1.jpg" target="_blank"><span>Click to enlarge</span></a></div>
<div><span> </span></div>
<div><span><img src="/images/2016/01/11/A5-1.jpg" alt=""></span></div>
<div> </div>
<div>
<div><span><strong><span style="text-decoration: underline;">Infrastructure plans and peri-urbanisation</span></strong></span></div>
<div><span> </span></div>
<div>
<span>Projected population growth between 2011 and 2031 is evidently huge - the equivalent of an entirely new Melbourne and Brisbane combined! - while t</span><span>he projected growth to 2061 is more than all of the existing population of the capital cities cobbled together.</span>
</div>
<div><span> </span></div>
<div><span>However, according to the Australian Government, regional development and decentralisation policies tend to have a short life span, and thus regional population growth is forecast to decline as a share of the pie:</span></div>
<div><span> </span></div>
<div>
<span>"It is unclear whether governments and the Australian community would support material ongoing interventions over the long term to encourage decentralised growth. P</span><span>roposals for investment in regional areas need to be supported by rigorous and transparent analysis."</span>
</div>
<div><span> </span></div>
<div><span>A handful of areas which are close to the capital cities might be expected to grow appreciably, being "peri-urban" locations with social and economic linkages to the capital cities. These are cited as follows:</span></div>
<div><span> </span></div>
<div><a href="/images/2016/01/11/B4.jpg" target="_blank"><span>Click to enlarge</span></a></div>
<div><span><img src="/images/2016/01/11/B4.jpg" alt=""></span></div>
<div> </div>
<div> </div>
<div>
<div><span>Notes the Government: "In the absence of employment growth in these locations, ‘journey to work’ trips to and from the capital city may increase appreciably."</span></div>
<div><span> </span></div>
<div><strong><span style="text-decoration: underline;">Infrastructure investment: cities are critical</span></strong></div>
<div> </div>
<div>The infrastructure audit background paper could hardly have been more explicit in its conclusions, so to wrap up I will simply quote it directly:</div>
<div><span> </span></div>
<div><span>"Within the capital cities, the location of new development and population growth will be critical. While the cost of providing new infrastructure in ‘greenfield areas’ is substantial, the cost of retrofitting or augmenting some infrastructure (for example transport links in tunnels) in established areas can also be high. </span></div>
<div><span> </span></div>
<div>
<span>With a few exceptions, the population case for expanding infrastructure networks in regional areas is less obvious. Arguments for investment in infrastructure in those areas will be driven more by social considerations."</span><br><span><br></span>While I don't agree with the intended policy - I don't originally hail from a capital city myself after all - it is abundantly clear that infrastructure investment will be focussed very heavily on the capital cities. </div>
<div> </div>
<div>
<p><span><em>PETE WARGENT is the co-founder of <a href="https://allenwargent.com/" target="_blank" rel="nofollow">AllenWargent</a> property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank" rel="nofollow">blogger</a>.</em><br></span></p>
<p><em>His latest book is <a href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx" target="_blank" rel="nofollow">Four Green Houses and a Red Hotel</a>.</em></p>
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Population growth and infrastructure crucial for property price growth: Pete Wargent

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<p>GUEST OBSERVER</p>
<p>Australia’s population rose by 0.3% over QII and annual growth held steady at 1.4%.<br> <br>Australia’s population is estimated to be 23.8 million as at June 2015.<br> <br>Net migration continues to be the driver of population growth, although its contribution to growth has eased.</p>
<p>The big picture</p>
<p>Australia’s population growth rate has been easing as a result of a slowdown in net overseas migration. The decline in the population growth rate has been a contributing factor to why potential growth in Australia is now estimated to be around 2¾% (potential growth was previously assumed to be around 3¼%).  Weak productivity growth and the ageing of the population have also weighed on potential growth.</p>
<p>Australia’s population growth rate was over 2% in 2009.       <br>Notwithstanding, at 1.4%pa, Australia’s population growth rate is still a lot faster than most other OECD countries. This means that the economy needs to be expanding at a faster pace than most other OECD countries to achieve full employment.   </p>
<p><a href="/images/2015/12/16/Screen%20Shot%202015-12-17%20at%201.12.08%20PM.png" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2015/12/16/Screen%20Shot%202015-12-17%20at%201.12.08%20PM.png" alt=""><br>The major driver behind Australia’s population growth continues to be net overseas migration (NOM).  However, its contribution to population growth has come down over the past few years.  Both sides of federal politics favour high levels of immigration to partially offset some of the effects from the ageing of the population.</p>
<p>The ‘grey army’ – those aged 65 and over – continue to grow as a share of Australia’s population. The growth of this age cohort underpins the structural decline in labour force participation. That said, there has recently been a cyclical bounce in the participation rate due to a lift in the demand for labour. The aging of the population has increased the dependency ratio (the age‑population ratio of those typically not in the labour force) which underpins the need for fiscal reform.</p>
<p><a href="/images/2015/12/16/Screen%20Shot%202015-12-17%20at%201.13.20%20PM.png" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2015/12/16/Screen%20Shot%202015-12-17%20at%201.13.20%20PM.png" alt=""><br>The detail</p>
<p>Australia’s population is estimated to have risen by 73k in QII (+0.3%). The lift takes the population to 23.8 million as at June 2015. The ABS estimates that NOM was 168k in 2014/15, down from 189k in 2013/14.  And well down from the peak of 315k in 2008.</p>
<p>State outcomes are mixed, but population growth rates have been converging. The decline in mining investment and associated downturn in mining‑related employment has contributed to a sharp slowdown in WA’s population growth. Victoria’s population growth rate is the highest across the States. Strong population growth in the Garden State underpins the big lift in residential construction in Melbourne.</p>
<p>Table 1 - Population Growth Q2 2015</p>
<p><a href="/images/2015/12/16/Screen%20Shot%202015-12-17%20at%201.14.51%20PM.png" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2015/12/16/Screen%20Shot%202015-12-17%20at%201.14.51%20PM.png" alt="" width="689" height="145"></p>
<p><em><span>Gareth Aird is e</span><span>conomist at Commonwealth Bank and can be contacted <a href="https://www.propertyobserver.com.au/https://au.linkedin.com/pub/gareth-aird/14/790/905" target="_blank">here</a>.</span></em></p>
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