<p>New apartment supply has become increasingly constrained across <a href="https://www.apartments.com.au/developments/parramatta-nsw-2150">Parramatta</a> in recent years, with fewer projects progressing through to completion as development conditions have become more challenging.</p>

<p>It makes <a href="https://www.apartments.com.au/developers/novm">NOVM</a>'s 2021-completed <a href="https://www.apartments.com.au/buildings/the-lennox-parramatta-12-phillip-street-parramatta-nsw-2150">The Lennox</a> one of the most recently completed residential towers on the Parramatta River, and among the newest apartment developments in Sydney's second CBD.</p>

<p>With the project largely completed before the sharp escalation in construction costs and inflation following the pandemic, The Lennox is now offering pricing that would be difficult to replicate in a comparable new development in Parramatta today, or across much of Western Sydney.</p>

<p>The majority of the 413 apartments at The Lennox sold before and shortly after completion. A limited release of the remaining apartments has recently been brought to market by capital partner <a href="https://www.apartments.com.au/project-marketer/equitifund-group">Equitifund</a>, with entry-level pricing from $700,000 and two-bedroom apartments available from under $1 million.</p>

<p>Rising above the Parramatta River at 12 Phillip Street, The Lennox comprises one, two, three and four-bedroom apartments, appealing to first home buyers, young professionals, families, downsizers and interstate investors seeking a completed apartment in one of Australia's fastest-growing economic centres.</p>

<p>[smartcode_project:default project_id=5743 project_image_fid=372394]</p>

<p>Rather than positioning Parramatta as an alternative to Sydney's CBD, Equitifund believes the city has reached a point where it stands on its own merits.</p>

<p>"Parramatta is no longer simply an alternative to Sydney CBD, it's becoming a destination in its own right," Equitifund Executive Chairman Greg Huxley said.</p>

<p>"The Lennox captures that evolution with a level of quality and amenity that's difficult to match at its price point."</p>

<p>[smartcode_project:default project_id=5743 project_image_fid=953]</p>

<p>Designed by <a href="https://www.apartments.com.au/architects/marchese-partners">Marchese Partners</a>, the tower responds directly to its riverfront setting through expansive glazing and open-plan layouts that maximise views across the Parramatta River and city skyline. Interiors feature engineered timber flooring, stone benchtops, stainless steel appliances and floor-to-ceiling glazing, while generous balconies extend the living spaces outdoors.</p>

<p>Marchese Partners says the project was conceived to balance high-quality apartment living with practical, long-term functionality, pairing larger, efficient floorplans with amenities more commonly associated with five-star hotels.</p>

<p>That emphasis continues through the resident facilities, which include a 20-metre rooftop swimming pool, fully equipped gym and wellness spaces, full-time concierge, a residents' lounge, function room, private lifts, secure basement parking and rooftop communal areas overlooking the Parramatta River. Ground-floor boardwalk retail and dining further activate the riverfront and integrate the building into the surrounding public realm.</p>

<p>[smartcode_project:default project_id=5743 project_image_fid=925]</p>

<p>Australian housing and finance group Equitifund has secured the remaining apartments, believing there are few completed apartment opportunities in Parramatta that offer the same combination of location, amenity and pricing.</p>

<p>Equitifund National Sales Director Ben Hamblett says buyers are increasingly recognising that premium apartment living no longer needs to come with Sydney CBD pricing.</p>

<p>"The Lennox is where aspirational living becomes attainable," Hamblett said.</p>

<p>"Wake to river and mountain views, step into Sydney's Second CBD, and arrive home to resort-calibre amenities, all without the harbour price tag."</p>

<p>Hamblett says owner-occupiers are also attracted by the convenience of having Westfield Parramatta, Church Street's dining precinct, Parramatta Park, Riverside Theatres, Western Sydney University and major transport connections all within walking distance.</p>

<p>"At The Lennox, lifestyle is not an afterthought, it is the foundation."</p>

<p>[smartcode_project:default project_id=5743 project_image_fid=5374]</p>

<p>The Lennox places residents within walking distance of Parramatta Square, Westfield Parramatta, Church Street Eat Street, Parramatta Station, the ferry wharf, Light Rail, the future Sydney Metro West, Parramatta Park and CommBank Stadium, reinforcing Parramatta's position as one of Australia's most connected metropolitan centres outside Sydney's CBD.</p>

<p>Equitifund says buyers visiting the display suite consistently comment on the quality of the finishes, generous floorplans, river and skyline views, and the walkability of the location. The project has attracted a broad mix of local professionals, upsizers, downsizers, buyers relocating from Sydney's inner suburbs and interstate investors seeking long-term growth opportunities.</p>

<p>That demand aligns with Parramatta's continued evolution as an economic powerhouse. Equitifund Research and Market Insights specialist John Bekiaris says sustained population growth, infrastructure investment and expanding employment opportunities continue to support long-term housing demand across the city.</p>

<p>"Parramatta has evolved from a satellite city into one of Australia's most important economic centres. Population growth, infrastructure investment and employment are all supporting sustained long-term housing demand."</p>

<p>[smartcode_project_cta:default project_id=5743]</p>


Joel Robinson

The apartment price gap drawing Sydney buyers west

<p>A luxury beachfront apartment at Rainbow Bay has more than doubled in value since it sold off the plan six years ago, setting a new local apartment record in the process.</p>

<p>The three-bedroom apartment in the Flow development on Petrie Street, the first of four new projects locally by Paul Gedoun's S&amp;S Projects, has sold for $7.4 million, after originally selling for $3.27 million when the project launched in 2020.</p>

<p>The seventh-floor apartment, comprising 187 sqm of internal living space and a 54 sqm balcony overlooking Froggies Beach and Snapper Rocks, was purchased by a local family.</p>

<p>The transaction was negotiated by Pezet Matheson director Kerry Pezet and equates to more than $30,000 per sqm.</p>

<p>Pezet said the sale reflected the limited opportunities to buy into the boutique beachfront development.</p>

<p>"The sale highlights the rarity of opportunities within the boutique beachfront development, where residences seldom become available," Pezet said.</p>

<p>"Flow is one of the Gold Coast's most tightly held buildings. Buyers from our database move quickly when residences become available, and achieving an off-market sale at $7.4 million demonstrates the depth of demand for property of this calibre."</p>

<p><img alt="Flow" data-entity-type="file" data-entity-uuid="c585b206-2130-4eee-a50c-3f27c51a7c70" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-06%20at%208.33.25%E2%80%AFPM.png?VersionId=m3pHRDV62Y3fvN.XQuQHq.52ilTWpRLf" /></p>

<p>Flow was the first of four luxury apartment developments delivered by Paul Gedoun's S&amp;S Projects at Rainbow Bay and was completed in 2023.</p>

<p>Positioned on the beachfront overlooking Snapper Rocks, the residence includes three bedrooms, three bathrooms, a powder room and views stretching north along the coastline towards Surfers Paradise.</p>

<p>Pezet Matheson Residential principal Mitchell Lambert said buyers continued to prioritise quality beachfront apartments in tightly held locations.</p>

<p>"Flow Residences offers a rare combination of elevated beachfront positioning, architectural excellence, comprehensive resident amenity and premium finishes, which is exactly what discerning purchasers are seeking," Lambert said.</p>

<p>"The transaction further reinforces Rainbow Bay's reputation as one of Australia's premier coastal lifestyle destinations, where limited supply and growing demand continue to support strong market performance."</p>

<p>Pezet Matheson originally marketed and sold out Flow off the plan, making the latest transaction a return to one of the project's original buyers.</p>

<p>Paul Gedoun is selling his third project, <a href="https://www.apartments.com.au/new-apartments/radia-rainbow-bay-271-boundary-street-coolangatta-qld-4225">Radia Rainbow Bay</a>, after recently completing, and selling out, <a href="https://www.apartments.com.au/buildings/esprit-217-227-boundary-street-coolangatta-qld-4225">Esprit</a>. He has plans for a <a href="https://www.apartments.com.au/news/qld/first-look-s-s-projects-proposes-88-apartment-wellness-tower-at-coolangattas-boundary-street">fourth building</a>, 88 apartments on <a href="https://www.apartments.com.au/new-apartments/209-213-boundary-street-coolangatta-qld-4225">Boundary Street</a>.</p>


Rainbow Bay apartment doubles in price since off the plan sale during pandemic

<p data-end="315" data-start="85">The long-planned transformation of Brisbane's historic Shafston Estate has taken another major step, with Capella Hotel Group announced as the luxury hospitality partner behind what will become Brisbane's first branded residences.</p>

<p data-end="499" data-start="317">The project, to be known as <strong data-end="376" data-start="345">Capella Residences Brisbane</strong>, is being delivered by Verso Projects at the landmark Kangaroo Point riverfront estate, with completion targeted for 2029.</p>

<p data-end="899" data-start="501">The announcement follows a series of planning changes to the project over recent years. The site was originally approved in 2023 for a 15-level, 37-apartment development designed by Rothelowman for Burgundy Group before Verso Projects took over the 10,070 sqm riverfront holding and lodged revised plans with Kerry Hill Architects to increase the development to a 25-level tower with 51 apartments.</p>

<p data-end="1154" data-start="901">The latest announcement confirms Capella Hotel Group will bring its branded residential offering to the project, marking just the second Capella Residences development globally after Seoul, and the group's first branded residential project in Australia.</p>

<p data-end="1387" data-start="1156">The <a href="https://www.apartments.com.au/new-apartments/23-castlebar-street-kangaroo-point-qld-4169">Castlebar Street development</a> will centre around the restoration of the heritage-listed Shafston House, one of Brisbane's oldest residences, originally constructed in 1851 by Reverend Robert Creyke as a single-storey cottage known as Ravenscott.</p>

<p data-end="1387" data-start="1156"><img alt="Capella" data-entity-type="file" data-entity-uuid="2b9f4ce5-638f-4d6b-8082-3ca7e4b75fca" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-09%20at%207.20.41%E2%80%AFAM.png?VersionId=f7aeqsW_DzOJI4FymWb3lD8NptSfsP7q" /></p>

<p data-end="1611" data-start="1389">Capella said the project aligns with its focus on heritage-led developments, with the Brisbane estate combining the restored historic residence with a new luxury apartment tower and hospitality-inspired resident amenities.</p>

<p data-end="1823" data-start="1613">Residents will have access to the Capella Living Room, a concierge-led communal space inspired by the group's luxury hotels, alongside landscaped gardens, six swimming pools, wellness and recreation facilities.</p>

<p data-end="2042" data-start="1825">The broader estate will also include two riverfront homes, a six-berth private marina, porte cochère arrival experience, secure basement parking and a new section of public riverwalk along the Brisbane River frontage.</p>

<p data-end="2177" data-start="2044">The heritage Postal Depot Building will also be retained and repurposed as a guest house, in line with the revised development plans.</p>

<p data-end="2420" data-start="2179">The project represents another evolution for the site, which Kerry Hill Architects previously described as a rare opportunity to restore one of Brisbane's most significant heritage estates while creating a new benchmark for apartment living.</p>

<p data-end="2724" data-start="2422">"The Shafston Estate provides a once-in-a-generation opportunity to restore one of Brisbane's finest heritage precincts and to reinstate residential use as a unique site perched on the edge of Kangaroo Point," Kerry Hill Architects said in its Urban Context Report accompanying the planning submission.</p>

<p data-end="2858" data-start="2726">"The project will celebrate excellence in sub-tropical residential design, setting a new benchmark for vertical living in Brisbane."</p>

<p data-end="3130" data-start="2860">Verso Projects, which now has an $8.5 billion development pipeline spanning more than 6,000 dwellings across apartments, townhouses, retail and commercial projects, said the partnership with Capella would elevate the development beyond a traditional residential project.</p>

<p data-end="3415" data-start="3132">"We feel honoured to be restoring Shafston Estate to its former glory, elevating it to new heights of luxury and excellence underpinned by Capella's distinctive service ethos and design philosophy, and making it a standout landmark in Brisbane," Verso Projects CEO Steve Laffey said.</p>

<p data-end="3658" data-start="3417">"By partnering with Capella, globally recognised for its refined approach to luxury hospitality and deep respect for cultural and historical context, we will elevate this project beyond a residential offering into a world-class destination."</p>

<p data-end="3820" data-start="3660">Capella Hotel Group President Roland Fasel said Brisbane's emergence as a global city made it the right location for the company's Australian residential debut.</p>

<p data-end="3961" data-start="3822">"Brisbane is a city on the cusp of something remarkable, and Capella Residences is our commitment to being part of that story," Fasel said.</p>

<p data-end="4083" data-start="3963">"The Capella residential experience is more than luxury. It is about a sense of belonging to a place with deep meaning."</p>

<p data-end="4227" data-start="4085">Private appointments have now opened for the project, with a display suite expected to open in late 2026 ahead of the planned 2029 completion.</p>


Capella to launch Brisbane's first branded residences at Shafston House, Kangaroo Point

<p>Lewis Land's latest apartment release within its <a href="https://www.apartments.com.au/new-apartments/harbour-shores-biggera-waters-564-oxley-drive-biggera-waters-qld-4216">Harbour Shores</a> masterplan is targeting one of the Gold Coast's fastest-growing buyer groups, with almost a third of apartments at Solis priced below $1 million.</p>

<p>The seven-storey building at Biggera Waters will comprise 91 apartments, including 24 one-bedroom residences starting from $778,000, a price point Lewis Land says is aimed squarely at first home buyers struggling to enter the Gold Coast market.</p>

<p><img alt="Harbour Shires" data-entity-type="file" data-entity-uuid="e7486e37-22f6-4c92-b212-9b0622070b8f" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-08%20at%209.09.34%E2%80%AFAM.png?VersionId=W8MJwJUCf6HkIyl_EVSksnd.QI6MZryY" /></p>

<p><a href="https://www.apartments.com.au/developers/lewis-land-group">Lewis Land</a> Head of Development Michael Long said the developer deliberately allocated a significant proportion of the project to more affordable apartment types.</p>

<p>"First home buyers have been priced out of many parts of the Gold Coast, and we saw a clear opportunity to address this and play our part in a longer-term housing solution," Long said.</p>

<p>"That's why 24 of the 91 apartments being delivered at Solis have been designed and priced for the city's next generation of homeowners, quality one-bedroom apartments, half of which include an additional multipurpose room to maximise space and flexibility.</p>

<p>"This approach places 30 per cent of apartments in Solis under $1 million, and with close proximity to Harbour Town's future light rail extension connecting residents to the city's major employment and knowledge hubs, it's a win for buyers looking to secure their first property."</p>

<p><img alt="Sores" data-entity-type="file" data-entity-uuid="550526d3-73ba-4710-9739-c5f4294a30ef" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-08%20at%209.09.29%E2%80%AFAM.png?VersionId=cQQdXHt9wS0UXwZEm5Py5bH_3kAmzyhu" /></p>

<p>Designed by BDA Architecture, Solis will deliver a mix of one, two and three-bedroom apartments, with residences ranging up to 232 sqm. Apartments feature generous balconies and contemporary finishes, while residents will have access to Harbour Shores' lagoon pool, clubhouse, tennis court, gym, yoga studio and sauna.</p>

<p>The focus on first home buyers resonated with purchaser Holly Humphreys, who said she and her boyfriend spent more than a year searching for their first property before shifting their attention from houses to apartments.</p>

<p>"We fell in love with the first house we bid on and got our hopes up, but after repeated knockbacks we learned not to get too attached," Humphreys said.</p>

<p>"We offered at the high end of price guides, but sales kept going even higher. That's where we really struggled and we needed to re-evaluate our budget and our expectations. Standalone houses were off the table, and we pivoted to apartments and townhouses."</p>

<p>Humphreys said it was encouraging to see developers recognising the growing demand from first home buyers.</p>

<p>"There's a growing number of young buyers looking to enter the market earlier because they understand that getting in now can make a real difference as prices continue to rise," she said.</p>

<p>"It's fantastic to see a developer recognise this and then actively take measures to deliver an apartment with us in mind."</p>

<p>Solis is the first development planned within the second stage of the Harbour Shores masterplan, with early works expected to commence in September 2026.</p>

<p>[smartcode_project_cta:default project_id=113271]</p>


Lewis Land targets first home buyers at latest Harbour Shores release, Solis

<p>Luxury apartment developer Abadeen has recorded $19.25 million in apartment sales across two of its Lower North Shore developments in the lead-up to the end of the financial year, headlined by the sale of a $6.75 million penthouse at <a href="https://www.apartments.com.au/buildings/koyo-crows-nest-5-rodborough-avenue-crows-nest-nsw-2065">KOYO in Crows Nest.</a></p>

<p>The transactions also included the sale of a newly completed three-bedroom apartment at <a href="https://www.apartments.com.au/buildings/park-residences-cremorne-2-sutherland-street-cremorne-nsw-2090">Park Residences in Cremorne</a> for $6.35 million, with the residence selling shortly after the project's first public inspections following completion.</p>

<p>The sales come as completed, owner-occupier-focused apartments continue to attract strong demand across Sydney's Lower North Shore, particularly from buyers looking for certainty and immediate occupancy.</p>

<p>The penthouse at KOYO spans 491 sqm across a single level and was designed by architect Koichi Takada. The development is one of Abadeen's flagship boutique projects in Crows Nest.</p>

<p>[smartcode_project:default project_id=108800 project_image_fid=370093]</p>

<p>Abadeen Executive Chairman and Founder Justin Brown said buyer activity lifted noticeably in the lead-up to the end of the financial year.</p>

<p>"We saw a clear increase in enquiry levels, inspection numbers and buyer engagement across our completed projects leading into the end of the financial year," Brown said.</p>

<p>"Buyers have become far more decisive over the past six months. The combination of improving confidence, limited supply and the ability to physically inspect completed residences is creating strong competition for premium apartments in the best locations."</p>

<p>Brown says the&nbsp;response to Park Residences following completion has been particularly strong.</p>

<p>"Buyers want certainty and are responding positively to the opportunity to walk through a finished product, inspect the quality firsthand and move in immediately," Brown suggested.</p>

<p>"Projects such as Park Residences and KOYO demonstrate that when the product is exceptional and the location is irreplaceable, buyers are prepared to act quickly."</p>

<p>[smartcode_project:default project_id=114246 project_image_fid=370116]</p>

<p>Abadeen CEO Joe Tack said quality continued to differentiate projects in the current market.</p>

<p>"Today's buyers are incredibly discerning," Tack said.</p>

<p>"They are seeking larger floorplans, premium finishes, walkability, lifestyle amenity and confidence in the developer delivering the project. Well-designed boutique developments continue to outperform because they offer something genuinely difficult to replace.</p>

<p>"The enquiry we are seeing across our completed and recently completed Lower North Shore portfolio is very encouraging, and we expect this momentum to continue into spring."</p>

<p>The sales follow increased enquiry across Abadeen's Lower North Shore portfolio which also includes <a href="https://www.apartments.com.au/buildings/northcote-collective-naremburn-2-northcote-street-naremburn-nsw-2065">Northcote Collective in Naremburn</a> which also completed recently.</p>


KOYO penthouse headlines Abadeen's $19.25 million EOFY sales flurry

Residential Market

<html><body>
<p><span style="line-height: 1.3em;">Housing investment in Australia has generally been a successful, largely one-way bet over many years. </span></p>
<p><span style="line-height: 1.3em;">Although this has been the case, home values have fallen in the past, are currently falling in some capital cities and will almost certainly fall again in the future.</span></p>
<p><span style="line-height: 1.3em;">As can be evidenced in the accompanying charts, in most instances across combined capital cities, the Index has been rising, in fact from December 1995 to November 2015. Combined capital city home values have increased by a cumulative 330.5% and values fell in 2008 and again between 2011 and 2012. </span></p>
<p><span style="line-height: 1.3em;">During 2008, combined capital city home values fell by -6.1% between March and December. Home values fell by -6.5% between March 2011 and May 2012. </span></p>
<p><span style="line-height: 1.3em;">While the Index shows a certain set of trends, it’s important to remember that it is largely influenced by Sydney and Melbourne. In fact, combined capital city home values have increased by 8.7% over the 12 months to November 2015 however, only Sydney and Melbourne have recorded value growth stronger than that level. Values have also been declining over the past year in both Perth and Darwin.</span></p>
<p><a href="/images/2015/12/11/Screen%20Shot%202015-12-11%20at%2010.31.04%20AM.png" target="_blank"><span style="line-height: 1.3em;">Click to enlarge</span></a></p>
<p><span style="line-height: 1.3em;"><img src="/images/2015/12/11/Screen%20Shot%202015-12-11%20at%2010.31.04%20AM.png" alt=""></span></p>
<p><span style="line-height: 1.3em;">Over the period from December 1995 to November 1995, all capital cities have seen values increase while each city has seen periods where values fall. Across the cities, the cumulative value increases have been recorded at: </span></p>
<p>• 330.1% in Sydney </p>
<p>• 421.4% in Melbourne </p>
<p>• 259.4% in Brisbane </p>
<p>• 261.2% in Adelaide </p>
<p>• 293.0% in Perth </p>
<p>• 208.0% in Hobart (from Sep-97) </p>
<p>• 180.1% in Darwin (from Apr-99) </p>
<p>• 258.7% in Canberra.</p>
<p>Of all the cities, Melbourne has led by recording the strongest rate of growth over the period followed by Sydney. Growth in Perth has been stronger than in Brisbane, Adelaide and Canberra where cumulative growth has been remarkably similar. While home values have risen significantly in each city, value falls have occurred.</p>
<p>There have been periods where values have fallen in a particular city but not others. As an example, from mid-2004 Sydney values started falling while in other cities, the rate of growth just slowed. Sydney home values fell by - 8.2% between March 2004 and December 2005. They then took until March 2009 to eclipse and remain above March 2004 levels.</p>
<p>Over the past few months we have seen early signs of value falls in the Sydney and Melbourne housing markets. Based on our data, we can see that falls have previously occurred, and will no doubt happen again, however, the question is how large; of course no one knows.</p>
<p>Given that investor activity has been at a record high, building approvals have also hit record highs and record high levels of household leverage there is a possibility that falls could be larger than what we have seen in the past. Note: Adjacent, the table looks at the two most recent periods of decline across the combined capital cities: the financial crisis in 2008 and as the RBA started to lift interest rates in 2011. The data shows the financial crisis saw a short, sharp fall in values and a fairly rapid recovery. The second period saw, in most instances, a much larger decline and a much longer period for recovery. </p>
<p><a href="/images/2015/12/11/Screen%20Shot%202015-12-11%20at%2010.26.15%20AM.png" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2015/12/11/Screen%20Shot%202015-12-11%20at%2010.26.15%20AM.png" alt="" width="871" height="520"></p>
<p> </p>
<p><a href="/images/2015/12/11/Screen%20Shot%202015-12-11%20at%2010.30.04%20AM.png" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2015/12/11/Screen%20Shot%202015-12-11%20at%2010.30.04%20AM.png" alt=""> </p>
<p><span style="line-height: 1.3em;"><em>Cameron Kusher is research analyst for CoreLogic RP Data. You can contact him <a href="https://blog.corelogic.com.au/author/cameron-kusher/" target="_blank">here</a>.</em> </span></p>
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ckusher-ujnxiKuFQs

Home values will certainly fall again: Cameron Kusher

<html><body>
<p>For the fifth consecutive week, CoreLogic RP Data is expecting over 3,000 auctions to be held across the combined capital cities, with 3,028 scheduled this week, down from 3,252 last week and the year’s record number of auctions the previous week (3,729).</p>
<p>There will be less capital city auctions this week, relative to last year, when there were 3,511 over the corresponding week.</p>
<p>Despite auction volumes falling on a broad capital city level, the same cannot be said for Adelaide, the only capital city where auction volumes are set to rise, with 151 Adelaide auctions scheduled this week, compared to 138 last week.</p>
<p>Melbourne auction volumes, down from 1,622 last week to 1,601 this week, have remained relatively steady, while across Sydney, auction activity will be significantly lower this week (902), compared to last week (1,070).</p>
<p><span style="text-decoration: underline;"><strong>Capital </strong></span><span style="text-decoration: underline;"><strong>City Auctions this week:</strong></span></p>
<ul>
<li>
<strong>Sydney</strong><strong>: </strong><strong>902</strong>
</li>
<li>
<strong>Melbourne: </strong><strong>1,601</strong>
</li>
<li>
<strong>Brisbane: </strong><strong>179</strong>
</li>
<li>
<strong>Adelaide: </strong><strong>151</strong>
</li>
<li>
<strong>Perth: </strong><strong>61</strong>
</li>
<li>
<strong>Canberra: </strong><strong>116</strong>
</li>
</ul>
<p>Summary of last week’s results:</p>
<p><a href="/images/2015/12/9/20151210-clearance-rate-table.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2015/12/9/20151210-clearance-rate-table.jpg" alt="" width="773" height="440"></p>
<p><a href="/images/2015/12/9/20151210-clearance-rate-graph.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2015/12/9/20151210-clearance-rate-graph.jpg" alt="" width="789" height="335"></p>
<p>Last week, the combined capital city final auction clearance rate was recorded at 57.3%, the lowest reading since February 2013. Much of the overall weakness was driven by Sydney, where only 52.9% of the reported auctions were sold last week, dropping from 56.2% the previous week.</p>
<p>Melbourne’s final auction clearance rate was 63.3%, over 10 percentage points higher than Sydney’s, but still lower than the cities result over the week prior (65.9%).</p>
<p>Adelaide was the only other capital city where the final auction clearance rate didn’t fall below 60%. There were 130 Adelaide auctions reported from a total of 138 that were held.</p>
<p><a href="/images/2015/12/9/20151210-sub-regions.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2015/12/9/20151210-sub-regions.jpg" alt=""></p>
<p> </p>
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smiller-vwPjRHTkST

Adelaide the standout mover in capital city auction volume: CoreLogic RP Data's Shana Miller

<html><body>
<p><span>Expat buyers should be aware that many of the homes available for sale are not yet listed on the internet.</span></p>
<p><span>These are properties that estate agents or buyers’ agents know have vendors willing to sell in the new year that have yet to advertised.</span></p>
<p>Peter Kelaher of PK Property Search and Negotiators says that a large proportion of the transactions negotiated by his firm are silent sales. </p>
<p>“Agents call us to say that a property is going on the internet in a month’s time,” says Kelaher.</p>
<p>Despite the softer auction statistics, inner Sydney agents are recording a significant amount of sale activity away from the Saturday auction limelight.  </p>
<p>Anthony Birdsall at Laing Real Estate said his agency was seeing good stock sell through private treaty negotiations.</p>
<p>The penny was dropping that inner Sydney apartment prices don’t seem to be going down in a hurry as competition remains for premium offerings, he said.</p>
<p>Some agents in some suburbs around Sydney have noted fewer overseas buyers, meaning less competition for expats in their acquisitions.</p>
<p>It can be traced back to then Treasurer Joe Hockey's crackdown on illegal fo<span>reign property investment, with new rules now meaning substantial fines for real estate agents, conveyancers and migration agents who knowingly assist illegal purchases. </span></p>
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Expats warned top listings might not yet be online

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<p>Once again we see a fast backtrack by many commentators who predicted a strong easing of real estate prices for the March quarter of 2016.</p>
<p>Then again there are those (like myself) who predicted an about-turn in property prices which is precisely what has happened. For the last four years the December quarter has been the worst performing quarter which can be simply put down to human fatigue.</p>
<p>For those who read the property markets wrong they then seamlessly move to Plan B – the debt debate and yes, Australia’s housing market does have a $1.45 trillion debt blister.</p>
<p>This debate is then marinated with housing affordability, which I must admit has everyone confused given the apparent lack of care or interest. Sydney and Melbourne, and Brisbane to a lesser extent, are flooding the markets with new developments, although in the majority of instances these properties are sold direct to non – resident Australians, so how does that work?</p>
<p>Take Sydney for instance – in the 1980’s the average house price ratio to median yearly household income was 3.0. In 2005 this ratio increased in Sydney to 8.5 and in 2015 it climbed to a staggering 12.2. I can’t see this breaking the back of house prices but I do see plenty of trouble ahead for the Sydney apartment market which has approximately another 22,000 new apartments in the investment pipeline over the next 24 months.</p>
<p>This is the market that requires closer examination and should not be confused with the family house market as the two are distinctly opposite.</p>
<p>We also need to look under the bonnet of the Australian economy to see what is driving it more particularly GDP. Sydney is way ahead of the pack with a 23.3 percent share overall Sydney has outperformed the rest of Australia for the last three years. Next in GDP is Melbourne with 17.7 percent, then Brisbane at 9.6 percent, Perth at 9.5 percent and then Adelaide at 4.6 percent.</p>
<p>If you look at the Green Square development (currently under construction) located between Alexandria and Moore Park in South Sydney – this development will deliver 27,276 apartments so they would be hoping that 60 percent are going to owner occupiers, as if! It is more like 80 per cent to property investors this will send rents in that area spiraling down as there will be a market flood when they all hit the market seeking tenants.</p>
<p>Investor beware! Australia is currently locked in to its biggest apartment development boom ever seen and the big problem is that these developments are congested into the same post codes and are not spread, so a cold can quickly turn to pneumonia.</p>
<p>What scares me the most is that we can trace this boom starting back in December 2008 when the ratio of foreign buyers was moved from 50 percent of new developments to 100 per cent. This ignited property developers and respective state and territory governments to move over night without any analysis to high density.</p>
<p>Again without analysis these developments have been contained into developing areas – so what if the foreign buyers decide not to proceed as the vast majority of these developments are yet to be completed?</p>
<p>It will be property investor mayhem because it’s one big Ponzi scheme totally reliant on the good faith of foreign investors completing on their transactions. Melbourne has another 123,622 apartments in the pipeline and Sydney has 88,013 and there are plenty more on the way awaiting approval. In the case of New South Wales, Victoria and Queensland the state governments are only focused on millions and millions of dollars in stamp duty and land tax.</p>
<p>Sorry to tell you but nobody has a contingency plan should these new developments start to collapse, because if they do the prices will drop 30 per cent minimum overnight.</p>
<p>So whilst housing affordability is directly a responsibility of government I, like many, are not feeling comfortable at how they plan to make it more affordable. With Sydney and Melbourne building the lion’s share of apartments we should also note they are contributing 41 per cent of the Australia’s GDP.</p>
<p>This is precisely the conversation our elected politicians need to be having and this should have started years ago. We may be building an apartment revolution but just like the share market we could be looking at the biggest ‘shorting’ in the property market we have ever seen before too.</p>
<p>Very, very happy to be wrong on this.</p>
<h5>MOSMAN – 2088</h5>
<p>• Number of houses on the market this time last year – 72</p>
<p>• Number of houses on the market last week – 54</p>
<p>• Number of houses on the market this week – 48</p>
<p>• Number of apartments on the market this time last year – 61</p>
<p>• Number of apartments on the market last week – 42</p>
<p>• Number of apartments on the market this week – 45</p>
<h5>CREMORNE – 2090</h5>
<p>• Number of houses on the market this time last year – 6</p>
<p>• Number of houses on the market last week – 4</p>
<p>• Number of houses on the market this week – 6</p>
<p>• Number of apartments on the market this time last year – 17</p>
<p>• Number of apartments on the market last week – 28</p>
<p>• Number of apartments on the market this week – 28</p>
<h5>NEUTRAL BAY – 2089</h5>
<p>• Number of houses on the market this time last year – 15</p>
<p>• Number of houses on the market last week – 7</p>
<p>•Number of houses on the market this week – 6</p>
<p>• Number of apartments on the market this time last year– 36</p>
<p>• Number of apartments on the market last week – 26</p>
<p>*Number of apartments on the market this week – 25</p>
<p> </p>
<p><em><span>ROBERT SIMEON</span> is a director of </em><em><a href="https://www.rwm.com.au/" target="_blank" title="RWM" rel="nofollow">Richardson Wrench Mosman and Neutral Bay</a> </em><em>and has been selling residential real estate in Sydney since 1985. <br>He has also been writing real estate blog </em><em><a href="https://www.rwm.com.au/news/" target="_blank" title="Virtual Realty News" rel="nofollow">Virtual Realty News</a> </em><em>since 2000. </em></p>
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Are we about to see our property investors short the market? Robert Simeon

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<p><span style="line-height: 1.3em;">Property developing can throw many different challenges at you and one thing I have learnt in this industry is there is always a solution to a problem.</span></p>
<p><span style="line-height: 1.3em;"> The trick is to understand what possible problems may arise and preparing yourself for them.  Unfortunately things don’t always go to plan and as a project manager it is up to us to make sure the development gets through as efficiently as possible.</span></p>
<p>One of the biggest areas for problems is not allowing enough for building works. </p>
<p>When pricing a development and running feasibilities, it is important to understand that your building estimate is an organic creature. By this I mean the building estimate you start with will nearly always be different to the one you end with.  It will evolve throughout the process as you obtain more and more details.  Once you have all the fine details, the building estimate can be finalised to the fixed price builder’s contract. </p>
<p>If architecturally designing our villas, we generally follow this process:</p>
<ol>
<li>Concept plan – this will show the number and size of villas on the land, but not much detail</li>
<li>Development Application (DA) plans – enough information is included on the plans to satisfy  council</li>
<li>Construction Certificate (CC) plans –more detail, including engineer drainage and slab design</li>
</ol>
<p>The starting point for our build estimate will be based on similar projects that we have recently completed and an allowance for the different site.</p>
<p>This progresses to an estimate based on the Concept Plan.  Still a very ‘loose’ estimate as there is usually not enough detail on the Concept Plan for the builder to have all information he needs.  The build estimate we have at this stage will tell us whether we are tracking within budget.  If not, we can make the necessary changes required, perhaps reducing the size of the villas working with both our builder and architect to design the right dwellings for our project to be successful.</p>
<p>Once the Concept Plan is approved, the architect will proceed to full DA plans.  It is here that much more detail is added and we will have our builder price the DA plans.  Again, this does not give us a final build cost but we will be getting closer to the expected outcome.  Once approved by our client, the DA plans are finalised and the DA is prepared.</p>
<p>During the DA process, council may request some changes to the plans, so it is important to understand we are still ‘evolving’ at this stage. We also need to review the Conditions of the DA Consent before we have more detail to finalise the build costs.</p>
<p>Once council have approved the DA, we will start to prepare the CC plans.  Engineers will be briefed and a drainage and engineered slab design or footings for the foundations will be produced. More detail is added to the CC plans, finalising levels and double checking schedules. </p>
<p>Before we lodge the CC plans with our private certifier we will have our builder issue a third costing. It is this costing that will give us the final build costs...well almost.  We still need to have the CC approved and ensure there are no further revisions to the plans required.  </p>
<p>After we have the CC stamped plans, our builder will issue their final tender and building contract. This will be a fixed price contract; however, there may still be a few items that will be ‘provisional’. They are usually some site works, removal of fill and retaining walls.  The builder may mark these items as provisional as they won’t know until works proceed exactly what the cost is. For instance, if rock is hit during the site cut, this will increase the site costs. If the site cut differs slightly to the plans, this may impact on the height of retaining walls.  So these ‘provisional’ items will be charged at actual cost whether it is lower or higher. Our clients often enjoy credits on their provisional items as it’s always best to over allow than under.</p>
<p>So you can see how the build estimate must evolve through the development process and until your development is completed, you really won’t know the exact cost.  It’s important you allow a contingency amount for any variations that may crop up along the way.  At Property Bloom we are happy to say that for many of our projects the end construction cost is lower than our original estimates. This is because our builder uses accurate allowances and because we’ve worked together for so long, we all understand what the cost is likely to be based on the typical, lower risk development sites we select for our clients.</p>
<p>As a developer, you will embark on a challenging journey from start to finish and the path you choose can be simplified with the help of a project manager to guide you along the way.  Always take the time to have full builder’s estimates done at each stage to avoid any nasty surprises. </p>
<p><em>Jo Chivers is chief executive officer of property development project managers <a href="https://www.propertybloom.com.au/about" target="_blank">Property Bloom</a>.</em></p>
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Why construction costs evolve: Jo Chivers

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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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</div>
</div>
</div>
</div>
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Population growth and infrastructure crucial for property price growth: Pete Wargent

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<p>I'm not yet clear whether there has been a revision to the Residex house price index methodology.</p>
<div>But, for what it's worth, here are the latest median prices, which have now been disclosed.</div>
<p>The Sydney median house price hit a new high of $1,117,500 in December 2016.<br><br>The Sydney median unit price increased to a new high of $725,500.</p>
<p>Click to enlarge</p>
<div class="separator"><img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/02/10/RESI1.jpg" alt=""></div>
<p><br>The median unit price rose by 7.4 percent in 2016, while the median house price increased by 7.1 percent.</p>
<div>One of the metrics I've been tracking has been the change in Sydney unit prices when priced in Chinese yuan terms. </div>
<div> </div>
<div>As you can see in the chart below, Sydney unit prices have increased by only 15 percent since this cycle began for offshore Chinese buyers. </div>
<p><a href="https://www.propertyobserver.com.au/images/2017/02/10/RESI2.jpg" target="_blank">Click to enlarge</a></p>
<div class="separator"><img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/02/10/RESI2.jpg" alt=""></div>
<p> </p>
<div>Rising prices have therefore not been much of a deterrent for Chinese buyers.</div>
<div> </div>
<div>However, regulatory measures have been.</div>
<div> </div>
<div>Upon discussion this week with developers in Brisbane, it's clear that activity from China has, if not halted, slowed up dramatically since last year. </div>
<div> </div>
<div><strong><span style="text-decoration: underline;">Rates on hold</span></strong></div>
<div> </div>
<div>In other news, there were few surprises in the Reserve Bank's Monetary Policy Decision, whereby the official cash rate was left in hold at 1.50 per cent.</div>
<div> </div>
<div>The RBA expects reasonable growth in the economy in the December quarter, and expects growth to remain at around 3 per cent over the next couple of years. </div>
<div> </div>
<div>The real cash rate now sits just below zero.</div>
<div> </div>
<div class="separator"><a href="https://www.propertyobserver.com.au/images/2017/02/10/REAL%20CASH%20RATE.jpg" target="_blank">Click to enlarge</a></div>
<div class="separator"><img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/02/10/REAL%20CASH%20RATE.jpg" alt=""></div>
<div class="separator"> </div>
<div class="separator">
<em>PETE WARGENT is the co-founder of </em><a href="https://allenwargent.com/"><span class="s2"><em>AllenWargent</em></span></a><em> property buyers (London, Sydney) and a best-selling author and </em><a href="https://petewargent.blogspot.com/"><span class="s2"><em>blogger</em></span></a><em>. </em>
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Sydney median prices rose in 2016: Pete Wargent

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<p>Tasmania is a fine example of the adage that it’s easy to get a bad reputation but very hard to lose it. </p>
<p>The days of Tasmania being the basket case economy of Australia are gone, as are the days when investors steered clear of Hobart as a place offering no growth.</p>
<p>I’ve been advocating the merits of investing in Hobart for the past 18 months or so, based on the marked improvement in the state economy and the status of Hobart as the capital city with the lowest prices, tightest vacancies and highest rental yields.</p>
<p>Hotspotting’s regular research into sales activity has noted the rise in sales volumes in Hobart (and also in Launceston and Devonport) this year.</p>
<p>I’ve felt a bit like a voice in the wilderness, given that Hobart and Tasmania is a pretty hard sell. It’s very hard to shift entrenched attitudes, particularly as your average punter isn’t terribly well informed.</p>
<p>So how refreshing to see the latest research-based report from Simon Pressley of Propertyology. </p>
<p>He says: “Hobart is Propertyology’s tip to be Australia’s best-performed capital city property market in 2017."</p>
<p>“An under-rated economy, limited properties for sale, the tightest vacancy rates in Australia, a more controlled housing supply pipeline than mainland cities, and increased buyer activity are expected to drive property prices and rents higher.</p>
<p>“We have been actively investing in Hobart for a while and our buyer’s agents have observed first-hand price growth of 8 to 10 per cent over the past 12 months. We can only see buyer activity further intensifying and forcing stronger growth over the next couple of years.”</p>
<p>And Pressley makes this forecast for next year: “On an all-things-being-equal basis, double-digit price growth is well and truly on the cards for Hobart in 2017.”</p>
<p>He says the significant retraction in properties listed for sale has made it increasingly difficult for our buyer’s agents to find suitable properties for investors. “Properties are generally selling within a week of listing and often going for prices well above our own appraisal range. The market is red hot.”</p>
<p>All this is happening on the back of improving economic performance. There is now a long list of reports from name brands which have noted the improvement in the underlying fundamentals.</p>
<p>The latest to confirm that view is CommSec’s <em>State of the States</em> report, which notes Tasmania’s population growth is the fastest in five years and the state no longer ranks last overall. </p>
<p>“Tasmania has improved from 8<sup>th</sup> to 7<sup>th</sup> on the rankings,” it says. “Tasmania is 4th ranked on two indicators and 5<sup>th</sup> on three indicators. Annual growth on home lending is the strongest in the nation at 10.3%. Both home loans and home prices are lifting.”</p>
<p>State Treasurer Peter Gutwein says the report card is the best in five years. “But there is still a long way to go,” he says. He’s right, but a significant turnaround has been achieved already.</p>
<p>Another positive indicator for Tasmania is the level of infrastructure and construction work. The Deloitte Access Economics <em>Investment Monitor</em> report says: “The value of Tasmanian engineering projects under way has stayed well above $1 billion and there’s just under $1 billion worth of planned projects in the pipeline.”</p>
<p>The biggest under way is the $535 million Midland Hwy update. Work worth $239 million is ongoing on the freight rail revitalisation statewide and there is a $40 million extension of the Hobart Airport runway. The report says commercial building is also “coming along well,” with $1.5 billion worth of projects under way and a similar pipeline of planned work.</p>
<p>“The $689 million Royal Hobart Hospital project is still the largest project,” it says. “Planned work has been boosted, with University of Tasmania plans to move its science-technology-engineering building to Hobart’s CBD, at a cost of $400 million.”</p>
<p>The value of projects under way is up 27 percent to $2.9 billion. Adding planned projects, the total is $4.98 billion.</p>
<p>Tourism is big for Tasmania, with strong results for 2015-16. For the first time Tasmania had over one million interstate visitors, who spent $2 billion. Airline capacity rose by 173,658 new seats between the state’s two main airports and Melbourne, Sydney and Brisbane. TT-Line ran 33 extra day sailings over peak season, with visitors arriving on Spirit of Tasmania growing 17 percent.</p>
<p>In the 2015-16 summer, there were 59 cruise ship port calls in Tasmania — delivering 163,328 passengers and crew. Big growth in cruise ship visits is forecast for the next two seasons. The tourism industry supports 36,700 jobs or 15.3 percent of total jobs, and contributes $2.55 billion to the economy (10 percent of gross state product).</p>
<p>All of that provides a solid foundation on which real estate can continue to grow in Hobart, Launceston and Devonport.</p>
<p><em>Terry Ryder is the founder of <a href="https://www.hotspotting.com.au/" target="_blank">hotspotting.com.au</a>. You can <a href="https://mailto:ryder@hotspotting.com.au" target="_blank">email him</a> or follow him on <a href="https://twitter.com/hotspotting" target="_blank">Twitter.</a></em></p>
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terryryder-YECXbqmri2

Solid foundations for real estate growth in Hobart, Launceston and Devonport

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<p>Australia is a nation full of highly confused real estate consumers. They’re befuddled because there is so much conflicting data on matters relating to residential property, especially on prices.</p>
<p>The confusion arises because of the widespread acceptance of anything labeled “research” as fact. Media these days is driven by under-resourced journalists and there’s a growing tendency to recycle press releases as articles, without the scrutiny that once was common in the industry.</p>
<p>Back in the day, publishing a press release (which, by definition, is someone’s propaganda) verbatim was a sacking offence. These days it’s mainstream journalism, especially in real estate. Most of the online “news” services that send out daily bulletins consist almost entirely of contributed material. The journalistic content is close to zero. </p>
<p>Any press release from a name research company featuring price data will be published without question. If the press release says Sydney prices are still soaring, that will be the headline in multiple media outlets, including some of our biggest newspapers.</p>
<p>The problem is that price statistics are often very rubbery figures. One of the ways we know this is by comparing price data from multiple sources. The differences and contradictions are quite stark. </p>
<p>Recently I wrote a report which focused on the latest price data for the eight capital cities from four different research sources. The areas where they disagreed were far more numerous than the ones where they were broadly in concert.</p>
<p>Two sources claimed Sydney prices were still growing at an annual rate around 11 percent, while the other two said the annual growth rate was down to 1.2 percent and 2.6 percent.</p>
<p>One source said Darwin house prices were unchanged while another recorded an 8 percent decline. Two sources said Canberra apartment prices were rising and the other two reported they were falling. All four agreed that Darwin apartment prices were falling but the rate of decline ranged from 0.2 percent to almost 10 percent.</p>
<p>Annual price growth for Melbourne houses ranged from 7 percent to 15 percent. One said the capital city average was 2.7 percent annual growth in house prices while another claimed it was 8.2 percent.</p>
<p>There are myriad other examples.</p>
<p>We know that different research companies have different methodologies and parameters, but consumers are entitled to think that the movement of prices in a particular location is a mater of fact: when media reports one week that they’re rising and the next that they’re falling, confusion is understandable.</p>
<p>It seems no one in media has noticed the discrepancies.</p>
<p>And now we have the Reserve Bank revealing that it disregarded price data from one of its regular sources. Apparently a change in methodology resulted in the research entity overstating price growth in Sydney and Melbourne.</p>
<p>At the time those figures were published, I challenged them because I thought they were clearly wrong. They contradicted known trends in the market and also conflicted with data from other more credible sources. </p>
<p>But media outlets across the nation published those erroneous figures as fact. There were numerous headlines declaring the fading Sydney boom had been reactivated somehow, miraculously, in contradiction of all previous data.</p>
<p>Inevitably this was accompanied by observers shouting about bubbles, affordability crises and young Australians priced out of the market, doomed to a lifetime of renting.</p>
<p>Worse, one of the big-name global ratings agencies rushed out a warning about the re-inflation of the Australian house price bubble, based purely on a single month’s price figures from one research source. It says something about the credibility of the ratings organisation that the basis for them issuing international press statements was so flimsy.</p>
<p>The message for real estate consumers is to take real estate statistics with several grains of salt. It’s alarming how many people base investment decisions on published data from a single source, reported verbatim by an unquestioning media.</p>
<p>Terry Ryder is the founder of <a href="https://www.hotspotting.com.au/" target="_blank">hotspotting.com.au</a>. You can <a href="https://mailto:ryder@hotspotting.com.au" target="_blank">email him</a> or follow him on <a href="https://twitter.com/hotspotting" target="_blank">Twitter.</a></p>
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Property price statistics are often rubbery figures: Terry Ryder

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<p>Approaching the halfway mark of the year with record low interest rates and consumer confidence back sees the market remaining strong with increases in values through several sectors of the market, including the real estate market in NSW's Coffs Harbour, say valuation firm Herron Todd White in their July 2016 residential market report.</p>
<p>Buyers in the $500,000 bracket can expect to purchase good quality five to 20 year old 3- or 4-bedroom, 2- or 3- bathroom homes on varying size sites located within two to three kilometres of the Coffs Harbour CBD and local beaches.</p>
<p>Standard new project style 4-bedroom, 2-bathroom homes range between $450,000 and $550,000 in the smaller central Coffs estates and southern suburbs of Bonville and Boambee East.</p>
<p>The more modern upmarket estate known as The Lakes at North Boambee Valley (two kilometres from the CBD) starts at around $500,000 for new 4-bedroom, 2-bathroom homes.</p>
<p>"If you are after more bang for your $500,000, the older established areas south of Coffs Harbour at Boambee East and Toormina will get you a five to 30 year old larger better quality 4- to 5-bedroom home with double garage and pool," says HTW.</p>
<p>Traditionally, these areas are of a more modest standard with values in the $300,000 to $450,000 range. These areas are well located close to the Pacific Highway for access north and south and are also located within two to three kilometres of the popular Sawtell Beach and shopping precinct. The major shopping centre at Centro Tormina is underpinned with K-Mart, Woolworths and Coles. Schools include primary and public high schools plus nearby St Josephs College and Southern Cross University.</p>
<p>The older homes within the northern beaches suburbs of Korora, Sapphire Beach, Moonee Beach and Emerald Beach have always been solid investments in the $500,000 to $600,000 bracket which buys 20 to 30 year old properties of good size located close to beaches and not far from major facilities in Coffs Harbour.</p>
<p>One area to watch is the beach side township of Woolgoolga, 30 kilometres north of Coffs Harbour. A traditionally strong agricultural area with good infrastructure, the recent bypass upgrade of the Pacific Highway and opening of Woolworths shopping centre only adds to the appeal.</p>
<p>Look to the southern side of Woolgoolga at Sandy Beach for the cheap beachside properties. Price points are generally under $450,000 for one to 30 year old homes of modest construction, with esplanade position properties going between $500,000 and $650,000. This area is still under developed with easy access to Woolgoolga and Coffs Harbour. The recent purchase of a large beachside development site will see substantial future residential development taking place which will lead to better infrastructure.</p>
<p>The Coffs Coast locality saw little capital growth over the GFC period, however the past 12 to 18 months has seen the market bottom and the start of the recovery.</p>
<p>"Traditionally we have not experienced the high levels of capital growth of the major cites due to the fairly low economic base within the region. Limited job opportunities does put a cap on the growth experienced in the mid to upper price brackets, while the majority of growth is centred under the $500,000 mark," HTW concludes.</p>
<p>As an example of recent affordable sales, Property Observer found a three-bedroom house at <a href="https://www.realestate.com.au/property-house-nsw-coffs+harbour-122873066" target="_blank">15 Sunnyside Cl, Coffs Harbour, NSW 2450</a> (above) which traded hands for $365,000. To put things in perspective, the median house price in Coffs Harbour was $425,000, according to CoreLogic </p>
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