For most new apartment buildings, the Owners Corporation starts life with little more than a bank account and the first quarterly strata levies.

At <a href="https://www.apartments.com.au/buildings/9-gay-street-castle-hill-9-gay-street-castle-hill-nsw-2154">9 Gay Street</a> in <a href="https://www.apartments.com.au/developments/castle-hill-nsw-2154">Castle Hill</a>, it starts with around $7 million in reserve.

It's an unusual legacy of what was once one of Sydney's highest-profile apartment remediation projects. When the development, originally known as Skyview and built by disgraced developer Top Place, came under scrutiny by then NSW Building Commissioner David Chandler, an $11 million remediation bond was negotiated to ensure any building defects could be fully rectified.

The building underwent an 18-month remediation program, during which around $4 million of that bond was spent bringing the building up to the standard it should have been in from the outset.

After extensive inspections, all active rectification orders have been lifted. What's more, around $7.2 million remains secured for the Owners Corporation for the next 15 years.

In a twist few would have predicted, what began as a significant concern for purchasers has left the building with something almost unheard of in the apartment market: a multi-million-dollar financial reserve from day one.

[smartcode_project:default project_id=147685 project_image_fid=359136]

<a href="https://www.apartments.com.au/project-marketer/equitifund-group">Equitifund</a> Executive Chairman Greg Huxley said the structure offers buyers a level of certainty that is difficult to replicate.

"The $11 million bond established for the Skyview Castle Hill development represents exceptional value, providing genuine financial security for purchasers," Huxley said.

"Unlike a standard insurance policy, this bond consists of real funds held in trust for the Owners Corporation, offering a tangible layer of protection and added peace of mind."

The apartments themselves have been designed with a focus on practical, contemporary living. Interiors feature Smeg appliances, stone benchtops, tiled living areas, carpeted bedrooms, 2.7-metre ceilings, floor-to-ceiling glazing, and ducted heating and cooling throughout.

Residents also have access to a range of shared amenities, including two rooftop barbecue areas, a swimming pool, children's playgrounds, secure building access, storage cages, and visitor parking.

The location continues to be one of the project's strongest drawcards. Castle Hill Metro Station sits virtually on the doorstep, providing direct connections across Sydney's expanding Metro network, while Castle Towers offers extensive retail, dining, entertainment, and service amenities within walking distance.

[smartcode_project:default project_id=147685 project_image_fid=359127]

The building, now named after its location at 9 Gay Street, comprises a diverse mix of one-, two-, and three-bedroom apartments starting from just under $600,000.

Equitifund National Sales Director Ben Hamblett said demand in the Hills District continues to be driven by buyers seeking convenience and connectivity.

"Interest from both owner-occupiers and investors in Castle Hill remains exceptionally strong, with buyers consistently prioritising developments in close proximity to the Metro station and Castle Towers Shopping Centre," Hamblett said.

"There is a clear trend in the market, with purchasers seeking convenient access to transport and lifestyle amenities that support a seamless, low-maintenance way of living."

On top of the long-term protection afforded by the remaining $7.2 million bond, Equitifund is offering a limited-time stamp duty rebate on selected apartments.

Eligible purchasers can also secure finance options, including a 3.99 per cent two-year variable rate, loan-to-value ratios of up to 90 per cent, and interest-only lending options through EquitiCredit.

[smartcode_project_cta:default project_id=147685]

Joel Robinson

Why this Castle Hill apartment building starts with a $7 million advantage

For much of the past few years, conversations about Australia's property market have centred on the rapid growth seen in Sydney, Brisbane, Gold Coast, and Perth. <a href="https://www.apartments.com.au/developments/melbourne-vic-3004">Melbourne</a> has followed a different trajectory.

That relative underperformance is now encouraging some buyers to reassess the city, particularly those willing to look beyond short-term market movements and focus on quality property in established locations, along with the long-term growth prospects of a city expected to overtake Sydney as Australia’s most populous.

John Bekiaris, Research &amp; Market Insights at <a href="https://www.apartments.com.au/project-marketer/equitifund-group">Projects by Equitifund</a>, said Melbourne's current position is attracting increasingly sophisticated purchasers.

"Melbourne continues to present one of Australia's strongest long-term investment stories," Bekiaris says.

"While other capital cities have experienced stronger recent growth, that relative underperformance is exactly what's attracting sophisticated counter-cyclical investors."

[smartcode_project:default project_id=1979 project_image_fid=363268]

Equitifund isn't just commenting on Melbourne's property market, it's investing in it.

The Sydney-headquartered capital partner has taken over the remaining apartments at <a href="https://www.apartments.com.au/buildings/victoriana-melbourne-20-queens-road-melbourne-vic-3004">Victoriana</a>, the recently completed glass-encased development opposite Albert Park Lake in Melbourne's tightly held St Kilda Road precinct.

Designed by <a href="https://www.apartments.com.au/architects/rothelowman">Rothelowman</a> and built by <a href="https://www.apartments.com.au/builders/hickory">Hickory</a>, Victoriana places residents between one of Melbourne's most recognised parklands and the CBD, offering oversized two and three-bedroom apartments aimed at owner-occupiers seeking a genuine alternative to a traditional family home.

The development comprises 232 completed residences alongside a suite of resident amenities, including a 25-metre indoor swimming pool, gymnasium, landscaped entertaining areas, resident lounges, EV charging, secure basement parking and a concierge-style arrival experience.

[smartcode_project:default project_id=1979 project_image_fid=363229]

The apartments have been designed with owner-occupiers firmly in mind.&nbsp;Open-plan living and dining areas flow onto generous balconies framing views across Albert Park Lake, Fawkner Park, the Royal Botanic Gardens and the Melbourne skyline.

Kitchens feature Gaggenau appliances, stone benchtops and generous preparation space. Bedrooms include built-in robes, while bathrooms feature full-height textured tiling. Hardwood flooring and ducted air conditioning complete residences designed for long-term living.

Rothelowman's architecture takes its cues from the landscape opposite the site. Sweeping horizontal glazing references the movement of Albert Park Lake, while generous balconies and expansive glazing strengthen the connection between the apartments and the surrounding parklands. The result is a building designed to deliver the scale and amenity expected of luxury apartment living, while offering the larger floorplans increasingly sought by owner-occupiers.

[smartcode_project:default project_id=1979 project_image_fid=363284]

The location is one of Victoriana's defining characteristics. Positioned on Queens Road, residents are directly opposite Albert Park Lake and within easy reach of Fawkner Park, the Royal Botanic Gardens, South Melbourne, St Kilda Road and the CBD. With few comparable development opportunities remaining in the precinct, buyers are increasingly placing value on outlooks that are unlikely to be interrupted by future construction.

Greg Huxley, Founder of Equitifund, believes those qualities become even more valuable over time.

"Premium real estate has always rewarded buyers who take a long-term view," Huxley said.

"Victoriana represents the kind of asset that's increasingly difficult to recreate today, particularly in an established location like Queens Road."

He said rising construction costs are also changing the way buyers assess completed developments.

"When you combine an irreplaceable location with thoughtful architecture and premium finishes, you create something that becomes increasingly difficult to reproduce as construction costs continue to rise."

[smartcode_project:default project_id=1979 project_image_fid=363228]

According to National Sales Director Ben Hamblett, enquiry has been driven largely by Melbourne downsizers and buyers upgrading from smaller apartments.

"Interest in Victoriana continues to build, with strong buyer focus on the larger owner-occupier residences within the development," Hamblett says.

"Enquiry is increasingly driven by local buyers who recognise the rarity of what's on offer: park-facing apartments in an established neighbourhood where new development opportunities are becoming increasingly scarce. At Victoriana, the view is not just a feature; it's an appreciating asset in its own right."

He said interstate enquiry has also strengthened as buyers reassess Melbourne's position within the national property cycle.

"Melbourne currently stands as the most compelling entry point of any major Australian capital, and discerning buyers are beginning to recognise what those who move early always understand: the best opportunities are taken before the price rise confirms them."

[smartcode_project_cta:default project_id=1979]

Why now is the time to buy in Melbourne's premium apartment market

Developers and apartment buyers have a narrowing window of opportunity before Brisbane's Olympic infrastructure pipeline begins competing directly with residential construction, pushing up costs, tightening labour supply and making new projects increasingly difficult to deliver.

While Brisbane's apartment market continues to benefit from strong population growth and limited housing supply, industry research suggests the years leading up to 2027 could prove to be the most important period for developers looking to secure builders and buyers hoping to purchase before the next wave of price increases.

A new Colliers report, Brisbane 2032 Olympic and Paralympic Games: Creating Solutions, highlights the scale of the challenge. While thousands of new homes are planned across South East Queensland, the Brisbane Olympic Athletes Village alone will deliver more than 10,500 beds during the Games before being converted into around 1,750 to 2,000 apartments. Equivalent to almost two years of typical inner-city apartment supply, the project will also absorb a significant share of the construction workforce and building materials.

The broader construction pipeline paints an even clearer picture.

Construction Skills Queensland's Horizon 2032 report forecasts Queensland's annual construction pipeline will average $69 billion over the coming years before peaking at $75 billion in 2027-28. Demand for construction workers is expected to increase by 17 per cent to almost 150,000 people, with the industry facing an annual shortfall of around 19,000 workers that could blow out to as many as 35,000 during the peak construction period.

The Olympic venues, athletes village and supporting infrastructure will account for billions of dollars worth of work across South East Queensland through to 2032, creating intense competition for labour at a time when Australia's residential construction sector is already under pressure.

[smartcode_project:default project_id=150489 project_image_fid=373834]

Colliers Queensland Residential Director Andrew Scriven said the convergence of these projects is creating a clear window of opportunity for both developers and buyers.

"From 2027 onwards, the market will shift dramatically," Scriven said.

"Labour will increasingly be locked into government-led infrastructure and Olympic projects, which means private residential developments will face higher costs and tighter margins. The developers who move now are the ones most likely to get projects off the ground."

Scriven said the same dynamic would also affect buyers, with fewer apartment projects expected to launch once construction capacity tightens.

"If you're looking to change your lifestyle over the next five years, now is your window of opportunity to buy."

[smartcode_project:default project_id=150713 project_image_fid=373827]

Developers are already positioning themselves ahead of that window.

Following the success of Monarch at Toowong, Consolidated Properties is preparing to launch two new Brisbane apartment projects in the second half of 2026. They include <a href="https://www.apartments.com.au/new-apartments/gloriette-30-bedivere-street-yeerongpilly-qld-4105">Gloriette</a> at Yeerongpilly Green, a 25-storey tower within one of Brisbane's key Olympic precincts, and <a href="https://www.apartments.com.au/new-apartments/castile-47-skyring-terrace-newstead-qld-4006">Castile</a>, a recently approved 25-storey riverfront development at 47 Skyring Terrace in Newstead.

Hutchinson Builders will deliver both projects, with early works already underway at Yeerongpilly and Newstead expected to commence later this year.

The timing comes as Brisbane's fundamentals continue to strengthen, with strong interstate migration, population growth and vacancy rates remaining below 1.5 per cent.

Colliers Queensland researcher Pragya Sharma said Greater Brisbane is forecast to require around 40,000 new apartments between 2021 and 2031.

"There's a real mismatch emerging between when housing is needed and when it will be feasible to build," Sharma said.

"As a result, the period leading up to 2027 presents a key window of opportunity for developers to secure approvals, funding and construction capacity, while buyers will have greater choice before supply constraints intensify."

Colliers research outlines a critical pre-2027 window to start residential projects before labour squeeze: now is the time to buy

Developers, buyers on watch in South East Queensland ahead of construction crunch: Colliers

It's taken less than nine months for developer Sherpa Property Group to sell out all 51 apartments in its <a href="https://www.apartments.com.au/new-apartments/flourish-oasis-palm-beach-7-9-sixth-avenue-palm-beach-qld-4221">Flourish Oasis</a> development in <a href="https://www.apartments.com.au/developments/palm-beach-qld-4221">Palm Beach</a>, over a year before its anticipated completion.

&nbsp;

Located at 7-9 Sixth Avenue, the $67 million development has resonated strongly with both local owner-occupiers and downsizers seeking high-quality apartments within walking distance of the beach, dining precincts and everyday amenities.

[smartcode_project:default project_id=151449 project_image_fid=357458]

Christie Leet, Founder of <a href="https://www.apartments.com.au/developers/sherpa-property-group">Sherpa Group</a>, said the sell-out reflected both the strength of the Palm Beach market and the success of Sherpa's community-first approach to development.

"The sell-out of Oasis is a fantastic outcome and reinforces the strong demand we're seeing for thoughtfully designed apartments in lifestyle locations," Leet said.

"From the outset, our vision was to create a development that genuinely enhanced the Palm Beach community while providing residents with exceptional homes and wellness-focused amenities.

"We've been incredibly encouraged by the level of local support throughout the campaign, 72.5 per cent of buyers are locals, with a significant proportion of purchasers choosing Oasis as their future home rather than an investment."

[smartcode_project:default project_id=151449 project_image_fid=357463]

Construction is now progressing following development approval, with trusted builder LPS Group delivering the project and completion anticipated in Q3 2027.

Oasis forms part of Sherpa Group's successful Flourish collection, which has become recognised for its focus on wellness, community and elevated coastal living.

[smartcode_project:default project_id=151449 project_image_fid=357469]

Residents will have private access to a rooftop amenity space featuring a pool, gym, sauna, steam room, hot and cold plunge pools, spa and barbecue facilities.

"The success of Oasis demonstrates that buyers continue to prioritise quality, location and lifestyle," Leet said.

"We are proud to have delivered a project that has resonated so strongly with the market and look forward to bringing Oasis to life for our future residents."

Sherpa recently launched <a href="https://www.apartments.com.au/new-apartments/flourish-soleira-palm-beach-1150-1160-gold-coast-highway-palm-beach-qld-4221">Flourish Soleira</a>, its third instalment of the Flourish brand in Palm Beach following Flourish Oasis and <a href="https://www.apartments.com.au/new-apartments/amargo-6-12-sixth-avenue-palm-beach-qld-4221">Flourish Amargo</a>.

[smartcode_project_cta:default project_id=151449]

Sherpa sells out Flourish Oasis in booming Palm Beach

Urban Property Group's <a href="https://www.apartments.com.au/new-apartments/la-vera-macquarie-park-94-talavera-road-macquarie-park-nsw-2113">La Vera</a> is leading the next phase of Macquarie Park's residential evolution, with the new apartment development set to become the first of several new apartment projects in the precinct to complete.

The 169-apartment building has now topped out ahead of its scheduled completion in the third quarter of 2026, as new residential investment continues to reshape one of Sydney's largest employment hubs into a true mixed-use precinct.

[smartcode_project:default project_id=134951 project_image_fid=368645]

Cox Architecture has designed La Vera to capture the best of its unique positioning on Talavera Road, orienting the building towards Lane Cove National Park.&nbsp;The building features a sculpted northern façade with flowing curves inspired by the surrounding landscape, while its city-facing elevation adopts a more structured architectural expression to maximise skyline views.

"The vision for the project was to conceive a building that adopted an organic and curvilinear form to the northern portion that faces the Lane Cove National Park," <a href="https://www.apartments.com.au/architects/cox-architecture">Cox Architecture</a> Director Felipe Miranda said.

"The residents that reside in the northern portion of the building benefit by having beautifully crafted curved balconies that speak to the natural context and heighten the relationship of their internal living spaces to the external balconies."

[smartcode_project:default project_id=134951 project_image_fid=358802]

La Vera offers a diverse mix of one, two, three, and four-bedroom configurations, with prices currently starting from $740,000. Buyers so far have been a mix of Sydney-based investors,&nbsp;metro commuters, owner-occupiers and downsizers from surrounding North Shore suburbs.

Both investors and owner-occupiers have been drawn to La Vera's proximity to Macquarie University, Macquarie University Hospital, Macquarie Centre and the Sydney Metro, infrastructure that supports both strong rental demand and a convenient lifestyle for residents.

The apartments feature full-height glazing, timber flooring throughout living areas, stone kitchen benchtops, SMEG appliances, floor-to-ceiling bathroom tiling and ducted air conditioning.

Residents will have access to a rooftop recreation level featuring a swimming pool, sauna, barbecue facilities and landscaped relaxation areas, complemented by additional communal space at ground level. Many apartments enjoy uninterrupted views across Lane Cove National Park, reinforcing the project's connection to its natural setting.

[smartcode_project:default project_id=134951 project_image_fid=364551]

<a href="https://www.apartments.com.au/developers/urban-property-group">Urban Property Group</a>, a family-owned developer and builder with nearly four decades of experience, holds a 4.5-star iCIRT rating and was Australia's first developer to introduce 10-Year Latent Defects Insurance (LDI). La Vera is the first apartment development in <a href="https://www.apartments.com.au/developments/macquarie-park-nsw-2113">Macquarie Park</a> approved to offer the additional insurance protection, alongside a five-year warranty on SMEG appliances.

Urban Property Group CEO Patrick Elias said the additional protection reflects changing buyer expectations in the off the plan market.

"Consumers are a lot more weary and a lot more concerned in buying off the plan than they ever have been. Having LDI is a tool to portray the confidence that we have in our product, and a confidence we want buyers to share," Elias said.

Following completion of the building later this year, buyers will move into their apartments well before Christmas.

[smartcode_project_cta:default project_id=134951]

La Vera closes in on completion as Macquarie Park continues residential transformation

Property Investors

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When investors are looking for good places to buy, consistency is a quality worth seeking. And the factor where consistency matters the most is in sales activity.
Some markets deliver steady levels of home sales, regardless of the booms or busts going on around them.
In each quarterly edition of The Price Predictor Index published by Hotspotting, we have spotlight the consistency markets – and we nominate a location as a nation’s most consistent market.
We have a strong focus on consistency markets because these are solid places for both home-buyers and investors.
The places we call the consistency markets sit in the middle of the spectrum, between the growth regions and the declining ones.
These are locations which record a consistent rate of sale, quarter after quarter, regardless of external events.  They represent safety for investors. 
And while they are often not boom markets, places with this high level of even performance usually produce solid price growth over time. 
They’re the housing market’s version of the “slow and steady wins the race” story.
In our new Summer edition of The Price Predictor Index, our award for the nation’s outstanding consistency market goes to Ulladulla in the Shoalhaven LGA in regional New South Wales.
It has sold between 43 and 58 homes in each of the past 13 quarters. Few locations in the country achieve that level of steadiness.
Ulladulla has a median house price of $510,000, after a 15 percent rise in the past 12 months.
To further illustrate the kind of growth that can happen in these steady performers, the winner in our Spring 2017 edition - Echuca in Victoria - had a 7 percent annual rise, while in the Winter 2017 edition our “most consistent market” - Sunbury  on the northern fringe of Melbourne - had a 10.4 percent annual increase. 
Generally in this report we look for locations where sales activity is rising, as these places are likely to deliver price growth. But the figures presented here for Ulladulla, Echuca and Sunbury show that steady market performers can achieve solid price growth as well.
As it’s not just short-term growth. Lalor Park in Sydney’s western suburbs, another noted consistency performer, has a long-term growth average (average annual growth in median house prices over 10 years) of 10 percent for year.
Greystanes in Sydney, which consistently sells 70-75 houses per quarter, averages 8.5 percent a year in median price growth.
Camp Hill, a suburb of Brisbane, has been averaging 7 percent per year.
Caroline Springs, a very steady sales market in western Melbourne, has averaged 7 percent per year. Frankston, which is both consistent and prolific in south-eastern Melbourne, has averaged 8 percent.
Some investors chase boom markets, seeking exponential short-term growth, and often end up with disappointing results.
There’s a lot to be said for the steady performers, which provide both safety and good long-term capital growth.
Very often, the tortoise out-performs the hare. 
Terry Ryder is the founder of hotspotting.com.au
<a href="https://mailto:ryder@hotspotting.com.au">ryder@hotspotting.com.au</a>
<a href="https://twitter.com/hotspotting" target="_blank">twitter.com/hotspotting</a>
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Lalor Park price growth highlights importance of consistency for investors

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Sydney investor Nathan Birch has blamed administration oversight for his recent mortgage default, not cashflow issues.
The Australian Financial Review reported earlier this month that Birch had been sued by his lender, Permanent Mortgages, after defaulting on a $535,000 mortgage for a Paradise Point, Gold Coast investment property.
Birch told News Ltd the AFR story was a "misrepresentation” of his situation, noting the property never got repossessed.
He told <a href="https://au.news.yahoo.com/sunday-night/a/38540739/real-estate-whiz-kid-s-secret-to-property-success/" target="_blank">Channel 7's Sunday Night's </a>Denham Hitchcock all his 200 properties were positively geared.
News Ltd reported Birch saying that the default situation arose from an oversight.
"I had an overdue amount which equalled to one month’s interest which was paid immediately as soon as it came to my attention,” he said.
“Having 200-odd properties, the admin side of things can become a bit too much and not seeing the mail on time meant I had no idea of this.”
Birch had previously confirmed to the AFR he had "briefly" fallen behind on "one or two mortgages" citing increased lending restrictions arising from the much-heralded Australian Prudential Regulation Authority investor crackdown.
Last year Birch had revealed he was selling up some of his massive portfolio due to tightening finance conditions.
<div>
Birch told news.com.au mid-last year he was looking to offload up to 20 properties estimating he would reduce his debt to about $18 million.
</div>
<div>Birch blogged  at the time that he was adjusting his portfolio and riding the new APRA crackdown finance challenge "without breaking a sweat".</div>
He said that he had had to adapt his investment strategy.
"As a result of the tighter lending practices, I have simply sold some smaller properties and purchased larger ones to set myself up for a development phase in my portfolio," he advised.
Birch said he believed the best place to buy in2018 was the Gold Coast, where he holds 50 properties.
 “The market here I think is only just scratching the surface,” he told Sunday Night. 
“It’s like Australia’s Miami. Prices are still post-GFC prices, still very low.”
His most undervalued suburb is Coomera.
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Nathan Birch blames the overdue mortgage on having to administer 200 properties

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Property investors will soon have a new organisation lobbying governments, with a group set to launch aiming to protect their interests.
The soon-to-be-formed Property Investors Council of Australia (PICA) describes themselves as a not-for-profit association run “by property investors, for the interests of property investors”. 
<div>
<div id="adspot-1x1-pos-5" data-google-query-id="COvdxtf-hdcCFU0ylgod9sQDLg">
<div id="google_ads_iframe_/31694718/domain.com.au/news_2__container__">Their objectives include spreading the message that property investors contribute to tax revenue, job creation, property and rental accommodation supply and affordability, self-funding retirement and economic growth.</div>
</div>
</div>
It also aims to stop investors from being “singled out”, saying property investors have been blamed as the main cause of unaffordable housing and being subject to potential tax grabs by governments.
With the ambitious aim of a membership base of more than one million members, the organisation was launched at the Sydney Property Buyer Expo on Saturday.
The chair of the group is Empower Wealth chief executive Ben Kingsley who said "the two million-plus property investors in Australia currently don’t have a voice”.
They will also push for the regulation of property advice, something that has also been the goal of the Property Investment Professionals of Australia group, which Mr Kingsley also chairs.
 
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Property Investors Council of Australia established to fight for investors

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For some (inexperienced) property investors, it’s often a burning issue: where is the next property hotspot going to be? It’s also a popular media topic and property spruikers love to claim to know where the next one will be.
Yet despite the hype around hotspots, they’re actually often irrelevant when it comes to property investment.
That’s because property investment is a long-term strategy requiring a 10-plus year view, while so-called hotspots are, more often than not, a short-term phenomenon.
To assess a suburb’s long-term investment potential, it’s crucial to know what factors will affect its value over time. Here are 5 features you can incorporate into your assessment of a suburb’s potential: 
 - Activity centres
Look for smaller local centres or larger shopping complexes that feature food and beverage offerings, retail stores and service providers, which can be utilised by local residents. This type of amenity will be valued by owner-occupiers and renters alike, meaning demand for suburbs that feature good activity centres will be higher. 
 - Close to major employment centres
Given the continued urban sprawl of many Australian capital cities, people want to live closer to the area where they work (such as city CBDs) to reduce their commutes. Suburbs closer to major employment hubs will typically be in higher demand. Furthermore, investing in suburbs on the urban fringe can limit capital growth as there is typically an abundance of land that can be developed, which adds extra housing supply that puts downwards pressure on prices. 
 - Public transport links
Growing capital cities are facing increasingly congested roads.  Public transport is therefore an important benefit to any suburb. Being in walking distance to good public transport links such as a train station or bus interchange is a highly sought-after feature. 
 - Parks and other recreational amenities
Parks, activity centres, playgrounds and other recreational amenities not only make suburbs looks more family friendly, but they also provide locals with some great lifestyle options, making the area more attractive and highly valued.
 - Schools and child care facilities
Many families want to live in specific catchment zones that feature high-performing public schools. Our research has uncovered as much as a 12% difference in prices for similar stock on 2 nearby streets, where the higher-valued street was in a catchment zone for a top-performing school whereas the other was not. You can check the performance of public schools on the NAPLAN website.  
Investors looking to invest in property in the coming years should take a long-term view rather than rely on hot-spotting. By focusing on the fundamentals, such as the above 5 features, you will be better positioned to find an outperforming property.
For more insight into the do’s and don’ts of property research, download your free copy of our latest ebook: <a href="https://wvw.momentumwealth.com.au/ResearchEbook?utm_source=Property+Observer&amp;utm_medium=Ebook&amp;utm_campaign=Ebooks" target="_blank">”How to find investment-grade properties using professional research principles”. </a>
 
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Forget the hotspots – the 5 suburb features for long-term property success

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For your next investment property, no doubt you’ll be researching different locations and property types. But which of these two factors is more important when it comes to property investing? 
Every major Australian city has hundreds of suburbs to research when buying an investment property. 
On top of that, there is a large range of property types to choose from: apartments and flats, villas and townhouses, stand-alone dwellings, development sites, vacant land etc. 
With so many options, it can be hard to figure out what to prioritise: should you focus on a property type and research to find the suburb that maximises returns for your chosen type, or do you research to find the best location and then decide on the best property type for that location? 
The answer to that question is not straightforward and will depend on your property investment goals. For most investors, the end goal is to create substantial personal wealth. 
If wealth creation is the main objective, typically location trumps property type as the most important aspect to consider. However, that doesn’t mean type isn’t important. It means that the type to focus on will be a consequence of the location you’ve selected. After all, a location may only make a good investment if you hold the right property type in that location.
Let us illustrate this. Bart is an investor looking for capital growth, and as such, has focused on location over property type. He found a location that ticks all the boxes, and is now deciding between two types available on the market: an older, stand-alone dwelling on a large block with development potential or a brand new apartment in one of the many apartment complexes that are popping up everywhere in the suburb.   
Generally, the house on the large block of land would make the better investment thanks to its large land component, which will continue to appreciate more and more as land becomes scarcer. If Bart selects the apartment, he would have to deal with increasing competition for this type in the area, which means he’d be competing with other apartments for tenants resulting in lower rentals returns. Further to that, the continued construction of new apartments will mean that there is always a large supply of similar stock on the market, which puts downwards pressure on his apartment’s value. 
If, on the other hand, Bart’s risk appetite was low and he was financially more constrained, he would have prioritised finding a neutral or positive cash-flow property and might have focused on a different type in a different location all together.
The main thing to take away from this is that when evaluating your chosen location and property type, you must always take into consideration your unique circumstances, which will entail your financial capacity, risk tolerance and life circumstances.
For more insight into the do’s and don’ts of property research, download your free copy of our latest ebook: <a href="https://wvw.momentumwealth.com.au/ResearchEbook?utm_source=Property+Observer&amp;utm_medium=Ebook&amp;utm_campaign=Ebooks" target="_blank">”How to find investment-grade properties using professional research principles”. </a>
<a href="https://wvw.momentumwealth.com.au/ResearchEbook?utm_source=Property+Observer&amp;utm_medium=Ebook&amp;utm_campaign=Ebooks" target="_blank"> </a>
 
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Location Vs property type – which is more important?

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Investors are positive about the long-term returns of Australian residential property, shrugging off concerns about stricter lending conditions, price bubbles and oversupply, a new survey has found.
More than 70% of the 742 respondents think now is a good time to invest in property, with 61% looking to purchase a property in the next six to 12 months (up from 58% last year), according to the third annual Property Investment Professionals of Australia (PIPA) Property Investor Sentiment Survey.
Surprisingly, Brisbane was at the top destination for property investors in spite of its apartment oversupply concerns, though the percentage who favoured the city fell from the last survey.
PIPA chair Ben Kingsley said that the survey results confirm that investors remain committed to property as a favourable investment option over the long-term.  
<a href="https://www.propertyobserver.com.au/images/2017/09/28/PIPA1.png" target="_blank">Click to enlarge</a>
<img src="https://www.urban.com.au/images/2017/09/28/PIPA1.png" alt="">
However, concerns over changes to investor lending policies loom large, with 43% of respondents reporting an adverse impact in their ability to secure finance, compared to 32% in 2016.  
Banks raising rates for interest-only loans was also a key concern, though more than half (55%) with interest-only loans said they would not struggle to meet new principal and interest repayments.
Higher borrowing costs also mean that investors are constantly looking for a better deal. 
More than 23% said they would consider refinancing their loan for an interest rate differential of 0.5 percentage points, while another 23% would consider refinancing for one percentage point.
According to the survey, only 15% of investors have put their buying plans on hold due to concerns around a property price "bubble". 
“Similar to last year, most property investors are looking past short-term challenges and are remaining focused on the long-term wealth benefits that are available from residential real estate,” said Kingsley.
Investors have also shrugged off speculation about negative gearing and capital gains tax changes, with only 14% putting their investment plans on hold.
The survey also shows that only half (52%) of property investors are currently negatively geared, with a majority (62%) of these expecting to become positively geared within five years. 
“The survey also affirms that a lot of the speculation about negative gearing misses the mark. Most investors understand that negative gearing is only a short-term cash flow position, not a property investment strategy. And only a very small minority are attracted to real estate for these tax concessions,” Kingsley said.
<a href="https://www.propertyobserver.com.au/images/2017/09/28/PIPA2.png" target="_blank">Click to enlarge</a>
<img src="https://www.urban.com.au/images/2017/09/28/PIPA2.png" alt="">
Despite being the most preferred destination for property investors, Brisbane has lost some appeal, with the proportion of investors favouring it falling from 49% to 43% over the past year. However, the city remains far ahead of any other capital city when it comes to investor interest. 
After Brisbane, Melbourne is the second most popular investment destination (32%), followed by Sydney (7.8%), Adelaide (6.6%) and Perth (5.5%).
“Property investors are becoming savvier. Many of them continue to look outside of our biggest property markets of Sydney and Melbourne, which are coming close to the peak of their cycles,” said Kingsley.
“The two key reasons that Brisbane still attracts investors are affordability and the potential for attractive yields. Brisbane is investing in infrastructure to make the city more liveable and investors are betting on this.”
Although investors are becoming more sophisticated, with 33% having a set strategy for investing, they overwhelmingly (84%) consider that more investment education about the risks and potential benefits of investing in property is needed. Even higher numbers (90%) believe that the property investment industry should be regulated and licensed in the same way as many other professionals.
“Unlike financial planning and mortgage broking, the provision of property investment advice still remains unregulated. PIPA is committed to raising the professional standards of this industry and will continue to lobby the government to regulate property investment advice and educate investors to help them make informed investment decisions,” Kingsley said.
 
 
 
 
 
 
 
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Property investors confident on real estate returns despite despite pressures: PIPA survey

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Amendments being pushed through by Revenue Minister Kelly O’Dwyer will deny property and share investors the special low small business company tax rate.
The changes seek to prohibit firms that earn 80 per cent or more of their revenue from passive or investment income from claiming the lower tax rate. Tax experts say it will only add another layer to the complexity of the tax system and highlight avoidance opportunities.
O’Dwyer said the government’s decision to cut the tax rate for small companies was not intended for passive investment companies.
“The Turnbull government is committed to lower taxes on business because we want to see them invest and grow,” she said. “These amendments will provide greater clarity about who qualifies for the lower company tax rate.”
The legislation would mean companies that have a blend of investment and conventional business activities will have to carefully structure them for tax purposes.
Tax Institute senior tax counsel, Bob Deutsch was quoted by The Australian as saying that the new two-tiered company tax system would raise issues about which rate to apply in what circumstances.
“There may be questions about whether it is appropriate, for example, for all rent to be classified as passive income for this purpose. At a broader level, the need for a policy decision of this type highlights the inevitable complexity arising from a two-tier corporate tax rate system,” Professor Deutsch said.
Director of the Australian ­National University’s Tax and Transfer Policy Institute, Miranda Stewart, said the draft legislation introduced a concept to tax law of “base rate passive entity income”.
“Previously only those who worked in technical areas would have had to deal with concepts like this, but now small businesses and their advisers will have to come to grips with it,” she was quoted by The Australian.
“We now have another boundary line between predominantly passive income and active business income.”
KPMG tax partner Grant Wardell Johnson said it had long been obvious as soon as the low small business tax rate was announced that there would be problems with whether a company with passive investment income was “carrying on a business”.
“The government found it hard to accept that in political terms,” he said. “I welcome the government’s move to establish a ‘bright line’ test.”
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jonathanchancellor-7SQnKwU6yx

Property investors to miss out on low tax rate in new legislation push

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Claims that local developers have left the Chinese market due to a lack of appetite is untrue, according to the founder of off-the-plan property marketplace Investorist.
"The idea that the market in China for Australian projects is over is not just an exaggeration, it's just plain wrong," Jon Ellis, managing director of Investorist, told The Australian Financial Review. 
His website connects developers with selling agents and currently lists about 215 mainly East Coast projects.
He contradicted an earlier claim by Scott Kirchner, a Shanghai-based director of real estate group Beller, in the AFR that Australian developers were not up in China pushing projects and that "Chinese agents have no appetite for Australian property".
An earlier report by Investorist also said that Australia remained the first choice for Chinese property investors, who are undeterred by regulatory changes or global events when it comes to buying property overseas and the trend is likely to continue in 2017.
While Ellis did say that demand from China was down about 40 per cent on a year ago, developers were still going to China to promote their developments and achieving sales.
"We recently achieved 24 sales for a Melbourne Docklands developer. If you have a decent product and are willing to persevere and have a sustained presence in China you will continue to make sales and heaps of them." 
He is taking six Australian developers, including Mirvac and real estate agents McGrath, to Investorist's next China Connection roadshow, which starts on Sunday, having taken five to the last event.
He said the roadshow in the cities of Guangzhou, Shenzhen and Shanghai are platforms for developers to pitch projects to Chinese estate agents.
"We do these roadshows based on demand from Chinese estate agents," said Ellis. "There is still the same level of demand. We have sold out each of our events within three weeks."
At educational seminars held in China, Investorist hosted representatives from 160 companies selling international property, and about 40 per cent expressed strong interest in continuing to buy Australian properties.
"A similar story emerges from our regular China Connection events; approximately half of the Chinese agents attending are there to meet Australian developers. The Chinese agents are attending because Australian property is what their clients are asking for," he said.
While demand from China was down, he said some of this shortfall had been taken up by increasing demand from local selling agents and channels.
"Across the board demand for off-the-plan properties is down about 25 to 30 per cent," he said. 
Ellis said this was due to changes to stamp duty rules that have removed concessions to investors buying off the plan in Victoria and tightening of lending by banks.
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Chinese demand down, but not out, says Investorist founder

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<img src="https://counter.theconversation.edu.au/content/81319/count.gif?distributor=republish-lightbox-advanced" alt="The Conversation" width="1" height="1">
GUEST OBSERVER
Contrary to the image a property investor might conjure up - a wealthy full-time property speculator - most residential investors in Australia don’t actually rely on it as their primary source of income.
In reality, Australia’s residential investment market is dominated by people who, having bought their own home, have moved onto buying an investment property. These small-scale investors own 83% of all investment properties.
Previous research shows that real estate investors tend to be married, wealthy males with high income and full-time employment. 
A typical rental housing investor is a high-income earner or family partnership, owning one or two dwellings as an extra income source. The probability of becoming a residential investor tends to increase with age and homeowner status, but declines after the age of 65.
<a href="https://www.propertyobserver.com.au/images/2017/08/01/Screen%20Shot%202017-08-01%20at%2011.34.43%20AM.png" target="_blank">Click to enlarge</a>
<img src="https://www.urban.com.au/images/2017/08/01/Screen%20Shot%202017-08-01%20at%2011.34.43%20AM.png" alt="">
With home ownership rates in Australia at around 70%, the Australian Bureau of Statistics (ABS) reports that residential investment represents, on average, 35% of all housing finance, while the rest are all owner-occupiers. This means residential investment is an important part of the mortgage market and banking system. 
Most residential investment is centred around rent or resale; only a small proportion goes on construction of new homes. And residential investment by corporations or big companies represents only 8% of the market.
Private data from a major mortgage provider used in my research (for the period 2003-09) reveals what the typical real estate investor looks like. They are on average 42 years old; 72% are married; and fewer than two-thirds of investors get finance with a co-borrower. Only a third of investors are female. 
<a href="https://www.propertyobserver.com.au/images/2017/08/01/Screen%20Shot%202017-08-01%20at%2011.35.44%20AM.png" target="_blank">Click to enlarge</a>
<img src="https://www.urban.com.au/images/2017/08/01/Screen%20Shot%202017-08-01%20at%2011.35.44%20AM.png" alt="">
The Conversation, <a class="license" href="https://creativecommons.org/licenses/by-nd/4.0/" target="_blank">CC BY-ND</a>
According to the same data, residential investors have an average net monthly income of A$8,600, or A$103,200 a year. But if we exclude the 100 investors with a net monthly income over A$100,000, the average net monthly income becomes A$6,617, or A$79,404 a year. 
Residential investors, financing the property with a mortgage, have on average A$934,091 in net wealth (50% of investors have A$581,541 in net wealth). Some of them have diverse portfolios; 6% of investors also own shares with an average value of A$4,884.
The data also show that direct residential investors are mainly professionals, in management positions, small business-owners, or workers with a skilled trade. Overall, 27% are self-employed, relative to the 19% of self-employed owner-occupiers.
Where they invest
The data reveal that direct residential investors invest mainly on existing houses, as do owner-occupiers when buying a property. The ABS reports only 3% of investors’ financial commitments are destined for construction of new dwellings.
Our data shows that residential investors are more willing to invest interstate or in a different postcode than owner-occupiers. While almost half of residential investors invest in a property located in a different postcode to where they live, 11% of residential investors buy properties in states other than the state where they live.
Most residential investors choose rural and regional areas to invest. Many residential investors choose to buy property in big metropolitan cities like Sydney and Melbourne. 
<a href="https://www.propertyobserver.com.au/images/2017/08/01/Screen%20Shot%202017-08-01%20at%2011.37.07%20AM.png" target="_blank">Click to enlarge</a>
<img src="https://www.urban.com.au/images/2017/08/01/Screen%20Shot%202017-08-01%20at%2011.37.07%20AM.png" alt="">
However, the top 10 postcodes chosen by residential investors to buy property (between 2003 and 2009) include Cairns (QLD), Mandurah (WA), Torquay (VIC), Mackay (QLD) and Launceston (TAS).
Why do they invest?
Our research shows the main reasons for accessing finance to buy a house, other than to live in it, are income and wealth accumulation. 
Some investors invest because they see it as a long-term, secure, “bricks and mortar” investment. To these investors other types of assets (such as shares and bonds) may seem harder to understand and it may be more costly to enter these markets. 
A proportion of real estate investors see it as a source of permanent income, while others speculate on the potential capital gains in real estate and invest expecting to increase their wealth. 
This reason becomes more prominent during periods of strong house price appreciation. For example, between 2003 and 2009 year-to-year average house price inflation has been 8.9%.
Academics have also argued that the Australian taxation system motivates – rather than facilitates – housing investment, as investors are able to access 50% deduction on capital gains and negative gearing. Another motivator to invest in real estate may be more mortgage finance access; for example, between 2003 and 2009 the average 12-month housing credit growth has been of 14.6%. 
Of course there are other reasons to invest, such as moving up or down and maintaining other property as an investment, or getting a holiday home and keeping it as an investment too. There are also “unintentional” real estate investors that may have inherited or acquired property.
Most residential investors are your average Australians, who invest in rural or regional areas as a secondary source of income and to gain equity. So when thinking about who is the typical Australian retail investor, you could probably look at your neighbour.
<a href="https://theconversation.com/profiles/maria-yanotti-349557" target="_blank">Maria Yanotti</a> is Lecturer of Economics and Finance Tasmanian School of Business &amp; Economics, University of Tasmania and author for <a href="https://theconversation.com/au" target="_blank">The Conversation</a>.
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jchancellor-FAypfDUnLy

Who is the typical investor in the Australian property market?

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Australia remains the first choice for Chinese property investors, who are undeterred by regulatory changes or global events when it comes to buying property overseas and the trend is likely to continue in 2017, says a recent report.
Chinese investors were driven by their motivation for diversifying wealth into assets outside of China, as also favourable conditions in gateway cities around the world, according to the survey by off-the-plan property marketplace Investorist.
The China 2017 International Property Outlook, which recorded the findings of interviews from 120 property agents in mainland China, found a majority of agents (88%) predicting sales volume of overseas properties to increase or remain unchanged in 2017.  
Investor interest was undiminished throughout 2016 and the first quarter of 2017, it said.
Earlier this year, data from the Foreign Investment Review Board showed Chinese investors dominated the list of foreign investment approvals for the financial year 2015-2016, with much of it in residential real estate.
Of the total $47.3 billion pledged by Chinese investors in Australia, real estate accounted for more than $31.9 billion, FIRB data showed.
Investorist founder and CEO Jon Ellis summed up the sentiment, saying Chinese outbound property investment “has been an unstoppable juggernaut to date”. 
“It has survived domestic currency controls imposed by the Chinese government and a range of shocks in international buying markets, from Brexit through to a nationalistic Trump administration and a raft of taxation and banking restrictions in Australia,” added Ellis.
The survey included findings from interviews of 120 agencies in mainland China, and compared them with research from other leading global research houses. 
While 70% of the agents surveyed predict an increase in demand, 18% expected demand to remain the same,  while only 12% said it would fall.
<a href="https://www.propertyobserver.com.au/images/2017/07/13/ChineseInvestorsSales.png" target="_blank">Click to enlarge</a>
 <img src="https://www.urban.com.au/images/2017/07/13/ChineseInvestorsSales.png" alt="">
The pricing ‘Sweet Spot’ in Australia for Chinese investors is $400,000 - $800,000,  said the survey, with apartments the top choice (64%), followed by single homes/house and land packages (55%), townhouses (38%) and land (33%).
Melbourne, Sydney and Brisbane accounted for around 90% of all off the plan purchases, with the Gold Coast, Adelaide and Perth way behind. 
In terms of yields, 5-7% including capital growth are the most attractive (50% of respondents), although not important to all. 
The top three selection criteria for Chinese investors were budget (64%), followed by location (63%), then investment return rate (58%).  
Some are motivated by buying in a school/university zone, migration, a second home or investment as a currency hedge. Children’s education was found to be the top incentive for overseas investment (76%), followed by migration purposes (69%) and asset safety and capital gain (68%).
<a href="https://www.propertyobserver.com.au/images/2017/07/13/ChineseInvestorReasons.png" target="_blank">Click to enlarge</a>
<img src="https://www.urban.com.au/images/2017/07/13/ChineseInvestorReasons.png" alt="">
The survey findings come amid major changes to the property landscape over the past 12 months in each of China’s key buy markets.
Though Australia currently holds #1 position for Chinese investors (69% of respondents,  USA (59%) is catching up fast and is expected to overtake Australia in 2017.
In Australia, a raft of increased taxes and duties and tighter lending by banks to investors dampened demand by up to 30% in the latter half of 2016 and early 2017, although demand is again on the rise. 
Interestingly, given the tight regulatory environment, 82% of Chinese investors have enough funds to settle property purchases, and potentially don’t require loans. Loans are sought for financial leverage, currency restrictions and other reasons, it said. 
<a href="https://www.propertyobserver.com.au/images/2017/07/13/ChineseInvestorsGrowth.png" target="_blank">Click to enlarge</a>
<img src="https://www.urban.com.au/images/2017/07/13/ChineseInvestorsGrowth.png" alt="">
In the US, there was much speculation in the lead up to the Presidential election in November 2016 about the implications for domestic property prices and foreign investment. 
“The prevailing view in China since President Trump has taken office is that as a very successful property developer and businessman, he will ensure the US continues to be an excellent market to both invest in and develop real estate,” says the report.
In the UK, the Brexit result in June 2016 and the immediate devaluation of the pound (31-year low, with more than 13% drop in value) presented an immediate opportunity for Chinese investors. A-grade property in London Zones 1–2 previously considered unaffordable, looked more attractive and offered greater yields as a result of the pound’s decline. 
The survey summed up that the overall sentiment from Chinese agents was positive, implying demand would continue from investors in the next 12 months.
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