The enormity of delivering a true skyscraper in Australia's new development market is often overlooked.

It has taken the best part of a decade since plans for Chevron One were first unveiled, but the 52-storey tower is now complete, with residents collecting their keys and moving into what has become one of the Gold Coast's most recognisable new landmarks.

Rising 127 metres above Chevron Island, Chevron One stands almost twice as high as any other building on the island. Its scale places it alongside the trio of towers at Jewel, arguably the last truly significant addition to the central Gold Coast skyline when they were completed around six years ago.

While there are several developments underway around a similar height to Chevron One, they are more concentrated within clusters of the highest towers in the city. The fact Chevron One sits within a developing precinct, looking back at the other high-rise developments in Surfers Paradise and Broadbeach, makes it a different proposition altogether. It will certainly become a reference point on the Gold Coast skyline.

[smartcode_project:default project_id=6515 project_image_fid=68833]

Developer Bensons Property Group is behind the 52-storey tower, which has just shy of 250 apartments, along with an exhaustive list of resident amenity spread across what is the largest development site ever assembled on Chevron Island.

The tower has been the talk of the town for years, says Ray White Projects Gold Coast agent Caitlin Rosenboom, who is selling the remaining apartments.

"People have been watching Chevron One go up for years," Rosenboom says, adding that many prospective buyers have been surprised by the scale of the views once they step inside.

"It's only when they walk through a completed apartment that they truly understand the position of the building," Rosenboom says.

"The views are jaw-dropping. Whether you're looking east over the ocean, across Surfers Paradise, along the river systems or out to the hinterland, every level offers something different but equally impressive."

[smartcode_project:default project_id=6515 project_image_fid=360215]

One of Chevron One's defining advantages is its location on the eastern side of Chevron Island on Stanhill Drive, a position which protects the views forever.

"There's only one row of houses between Chevron One and the water, and the height restrictions along the river means views from Chevron One can never be built out,"&nbsp;Rosenboom says.

While new apartment developments continue to emerge across the Gold Coast, Rosenboom says opportunities to secure a completed apartment with this level of outlook are becoming increasingly rare.

"The size of the site is something that would be incredibly difficult to replicate today," she says.

"That's allowed Chevron One to deliver the sort of amenity, open space and resident facilities that very few projects can offer. There are not many completed apartment buildings on the Gold Coast right now that can compete with the combination of scale, quality and amenity."

[smartcode_project:default project_id=6515 project_image_fid=68839]

There's around 2,000 sqm of amenity solely for the use of residents of Chevron One. Club One features a uniquely shaped swimming pool that mirrors the footprint of the building itself, set within a extensively landscaped gardens. There's also an indoor pool and spa, a fully equipped gym with a Pilates room, a yoga garden, a bookable private dining area and lounge that can host up to 30 people, and a 24-hour concierge service.

As for the buyers, Rosenboom is fielding enquiry from everywhere: Sydneysiders and Melburnians looking at the new and off-the-plan market following the changes in the Federal Budget, as well as those looking to relocate, through to South East Queenslanders seeking either a permanent home or a weekender bolthole.

"The Gold Coast lifestyle continues to resonate with people relocating from the southern states, and when they see the views and the quality of what's been delivered at Chevron One, it becomes very easy for them to understand the appeal," Rosenboom says.

A diverse mix of one, two and three-bedroom apartments remain available, with each offering "something a little different", be it the orientation and views, configuration, or level, to suit a wide variety of buyers.

The remaining apartments are ready to inspect in person, by appointment.

[smartcode_project_cta:default project_id=6515]

Joel Robinson

A decade in the making: Residents to move into Chevron One as construction wraps up

A general rule of thumb in new apartment developments is that the penthouses get the rooftop.

It's a formula that's become commonplace across Australia's apartment market. Residents might have access to a pool, gym or barbecue facilities on a dedicated lower level, but the most desirable outdoor spaces are typically reserved for the highest-priced homes at the top of the building.

<a href="https://www.apartments.com.au/developers/sherpa-property-group">Sherpa Property Group</a> has taken the opposite approach.

Rather than dedicating the rooftop to a handful of buyers, the Gold Coast developer has made it the centrepiece of its Flourish collection, creating expansive shared spaces from the best vantage point in the building.

The philosophy has reached its most ambitious expression at <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> in Palm Beach, where two rooftop precincts connected by a skybridge will deliver one of the most extensive lifestyle offerings seen in a residential apartment project on the Gold Coast.

[smartcode_project:default project_id=150017 project_image_fid=374053]

"We're seeing a clear move toward developments that offer more than just an apartment," Sherpa Group founder Christie Leet said.

"People want spaces that support how they actually live, whether that's working from home, staying active, or spending time with family and friends.

"That's where amenity becomes critical. It's not just about what's included, but how those spaces are designed to be used every day."

[smartcode_project:default project_id=150017 project_image_fid=374052]

The breadth of amenity has already attracted buyers across multiple demographics. Younger first home buyers have been drawn to Soleira's one-bedroom apartments, a product rarely delivered in Palm Beach, while families have responded to practical inclusions such as the shallow children's pool adjoining the main lap pool and the extensive communal recreation areas.

Instead of a single rooftop, Soleira delivers two distinct lifestyle zones.

[smartcode_project:default project_id=150017 project_image_fid=372547]

The southern rooftop has been dedicated to wellness, featuring a gym, yoga and Pilates studio, work-from-home facilities, a wellness centre, spa, and hot and cold plunge pools.

The northern rooftop focuses on recreation and entertaining, incorporating a heated resort-style pool, private dining rooms, pizza ovens, barbecues, a golf simulator, children's recreation areas, and what is expected to be the Gold Coast's first rooftop basketball court, which will also double as a squash court.

[smartcode_project:default project_id=150017 project_image_fid=374054]

Beyond the rooftops, Soleira will introduce 1,500 sqm of curated retail beneath the towers, creating one of Palm Beach's first genuinely mixed-use lifestyle precincts where cafés, restaurants and convenience retail become part of residents' everyday lives.

Sherpa has also retained management rights across the development, allowing it to oversee the long-term operation of the building through a 24-hour concierge model. The developer is also exploring additional revenue streams within the precinct aimed at helping offset ongoing body corporate costs for residents.

[smartcode_project:default project_id=150017 project_image_fid=370962]

While Soleira is the largest project Sherpa has delivered, the rooftop-first philosophy has been evolving for several years.

It began with <a href="https://www.apartments.com.au/new-apartments/amargo-6-12-sixth-avenue-palm-beach-qld-4221">Flourish Amargo</a>, the first project released under the Flourish brand. Rather than competing at the ultra-luxury end of the market with oversized half-floor and full-floor residences, Sherpa focused on creating lifestyle-driven apartments supported by resort-style shared spaces.

Amargo introduced more than 800 sqm of rooftop amenity, combining wellness facilities, heated pools, entertaining areas, cabanas, pizza ovens and private dining spaces into what was designed as an extension of residents' homes rather than a facility used only occasionally.

[smartcode_project:default project_id=146527 project_image_fid=366550]

That approach continued with Flourish Oasis, where the same amenity-led philosophy was refined into a more boutique development. Strong demand from Sherpa's growing VIP database saw much of the project sold before it reached the broader market, reinforcing buyer appetite for apartment communities centred around shared lifestyle experiences.

Flourish Amargo is slated for completion mid-way-through next year, with Oasis to be delivered by late 2027. Flourish Soleira is expected to complete in 2030.

[smartcode_project_cta:default project_id=150017]

Sherpa takes amenity to the sky as Flourish Soleira captures booming Palm Beach demand

As apartment living continues to evolve across Sydney's growth corridors, the quality and distribution of shared spaces is increasingly shaping how residents experience home. Rather than functioning as add-ons, amenities are being embedded into the daily rhythm of a building, supporting everything from quiet retreat to social interaction, often within a single vertical community.

At <a href="https://www.apartments.com.au/new-apartments/aeris-melrose-park-nursery-street-melrose-park-nsw-2114">Aeris</a> in Melrose Park, this approach is resolved through a layered amenity offering that unfolds from ground level through to its upper podium. Developed by <a href="https://www.apartments.com.au/developers/sekisui-house-australia">Sekisui House Australia</a> in partnership with Hankyu Hanshin Properties, the project introduces 468 apartments across two towers and a mid-rise building, positioned at the highest point of the broader masterplan.

[smartcode_project:default project_id=426 project_image_fid=359199]

The amenity experience begins at street level, where two courtyards sit within a landscaped setting that connects residents to the wider network of parks and green spaces. These green spaces are not isolated pockets but part of a wider pedestrian network that links Aeris to the surrounding <a href="https://www.apartments.com.au/developments/melrose-park-nsw-2114">Melrose Park</a> precinct, including Central Park, future schools, and the Town Centre opening in July 2026. The result is a transition that moves from public to private without abrupt boundaries, allowing residents to pass through shaded, tree-lined environments before reaching the building itself.

Moving upward, the focus shifts to the level five podium, where the primary communal facilities are concentrated. This space brings together a 16-metre swimming pool, outdoor seating areas, and a communal BBQ zone arranged to take advantage of elevated outlooks. Seating is positioned beneath pergolas, creating pockets of shade that extend the usability of the space throughout the day. The pool edge aligns with views toward the wider district, reinforcing the sense of elevation that defines the project’s positioning.

In the adjacent building, this is complemented by quieter, more contemplative spaces, including an outdoor cinema set within the same level. Positioned to operate primarily in the evening, it introduces a different tempo to the shared environment, shifting from daytime activity to after-hours use without requiring separate zones.

[smartcode_project:default project_id=426 project_image_fid=360299]

The podium also accommodates an intimate private resident gym. Located on the lower levels, it gives residents convenient access to fitness facilities without leaving the building.

Above, the elevated podium sky deck extends the amenity offering, providing additional open-air spaces with elevated outlooks across the surrounding landscape. While more restrained in program, this upper level reinforces the project’s vertical progression, from ground-level greenery to elevated outlook, allowing residents to move between distinct spatial conditions within a single address.

This distribution of amenities reflects a deliberate response to how residents use space across the day. Sekisui House Australia Sales and Marketing Director Peter Kalaf points to the role these shared areas play in shaping buyer demand. Aeris has been conceived as more than a collection of apartments, with the podium pool, gym and outdoor cinema forming part of a broader lifestyle offering that extends the home beyond each individual residence.

[smartcode_project:default project_id=426 project_image_fid=360300]

What distinguishes Aeris is not the inclusion of these elements individually, but how they are arranged in relation to one another. Active, social, and passive spaces are layered vertically rather than separated, allowing residents to choose between them without leaving the building or moving far from their apartment. This proximity supports both routine use, such as a morning swim or evening workout, and more occasional gatherings, whether around the BBQ area or within the cinema setting.

The amenity design also sits within a broader framework of connectivity across Melrose Park. The Melrose Park Town Centre, anchored by Coles and Dan Murphys, features a mix of retail, dining, health and lifestyle offerings, bringing everyday convenience closer to residents. By the end of the year, more than five hectares of parks and open space, equivalent to around seven football fields of green space on residents' doorstep, will further enhance the precinct, allowing the internal facilities at Aeris to operate as an extension of the wider neighbourhood rather than a substitute for it.

Construction at Aeris continues to gather momentum, with ground floor slabs expected to be completed in late 2026 before the first sections of the buildings begin to rise above ground.

[smartcode_project_cta:default project_id=426]

Elevated amenity anchors daily life at Aeris, Melrose Park

Repeat buyers are one of the strongest measures of confidence in any apartment development.

At <a href="https://www.apartments.com.au/new-apartments/era-newcastle-west-124-126-bull-street-newcastle-west-nsw-2302">ERA</a> in Newcastle West, some purchasers are returning to <a href="https://www.apartments.com.au/developers/gwh">GWH</a> after living at the developer's One Apartments. Their decision to purchase again was driven by the quality of life they found after moving into their first GWH home.

Keith Wilton had spent years living in a house in East Maitland before deciding it was time for a change. Apartment living had always been on his radar, but he was selective about what he wanted.

<iframe allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" allowfullscreen="" frameborder="0" height="315" referrerpolicy="strict-origin-when-cross-origin" src="https://www.youtube.com/embed/FH_1EzB-1vs?si=XScVlP1ERsTDJoME" title="YouTube video player" width="560"></iframe>

"I had some boxes I wanted to tick," he says.

Keith points to the open-plan design, generous outdoor areas and considered inclusions as key reasons One Apartments worked for him.

“One of those things was a nice indoor open plan area, but also I wanted a nice outdoor open area that I could entertain on in summer or Christmases or birthdays,” he says.

He also found value in the smaller details, from integrated appliances to shared resident spaces including the pool, cinema and rooftop areas.

[smartcode_project:default project_id=135096 project_image_fid=356818]

After comparing several developments, he chose One Apartments because of GWH's longstanding local reputation and his own experience working with the developer on a commercial project more than a decade earlier.

"I knew that they were local, that the quality of the build was going to be up there. I'd looked at other apartment complexes around and close by, and I just knew that here was a better decision location wise."

Today, Keith says the move has completely changed how he experiences Newcastle.

"I enjoy living in this location because it's more of a lifestyle change. That Newcastle city living where you can walk to restaurants and bars and even beaches and parks and even shopping across the road."

[smartcode_project:default project_id=135096 project_image_fid=356828]

Beyond the location, he says it's the sense of community that has surprised him most.

"Everyone loves living here because they chose to live here, but everyone looks out for each other. It's a real great community feel here."

For Aimee and Lyle Goodman, the journey started almost by chance.

<iframe allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" allowfullscreen="" frameborder="0" height="315" referrerpolicy="strict-origin-when-cross-origin" src="https://www.youtube.com/embed/tsioMLcnjas?si=zq-ys3JuWpfa5hFv" title="YouTube video player" width="560"></iframe>

The couple happened to be having coffee in Newcastle when they noticed the site where One Apartments was about to begin construction.

"We were aware GWH was planning a development," Aimee says. "We made one phone call and things moved pretty quickly after that."

As busy business owners, they initially thought apartment living would simply reduce the maintenance that came with larger homes. Instead, it fundamentally changed how they spent time together.

"We actually catch up more as a family now," Aimee says.

"We've had homes with big yards and lots of space, but everyone ended up in different rooms. Here we'll have dinner together, the kids can play, and we spend far more quality time together."

[smartcode_project:default project_id=135096 project_image_fid=356829]

Lyle says their confidence came from GWH's reputation within Newcastle's building industry.

"I know people who've worked across different apartment projects, and whenever GWH came up the feedback was always the same. They're rock solid. They're quality."

That confidence only grew throughout the buying process.

"One of the things that really impressed us with GWH was the whole process, was the communication," Lyle says. "It was consistent, it was regular, there was no problem if we had some weird questions, there was no problems in getting answers."

[smartcode_project:default project_id=135096 project_image_fid=351104]

Aimee says one moment stood out.

"The project actually finished on time. We realised we needed to hurry up and sell our house because everything was happening exactly when they said it would."

The positive experience at One Apartments ultimately gave all three buyers the confidence to purchase again with GWH, this time at ERA.

Their confidence reflects what many buyers are seeking in today's apartment market. Location remains important, but so too does certainty around delivery, quality and long-term liveability.

[smartcode_project:default project_id=135096 project_image_fid=356822]

ERA builds on those foundations with 280 one, two and three-bedroom apartments across two landmark towers in <a href="https://www.apartments.com.au/developments/newcastle-west-nsw-2302">Newcastle West</a>.&nbsp;

Designed by <a href="https://www.apartments.com.au/architects/fk-australia">Fender Katsalidis</a>, the project will include more than 2,000 square metres of resident amenities, including a resort-style pool, gym, sauna, private cinema and rooftop entertaining spaces overlooking the harbour and coastline.&nbsp;

The development is also within walking distance of the Newcastle Interchange, Honeysuckle, Darby Street, the harbour foreshore, restaurants, retail and the city’s beaches, continuing the walkable lifestyle that existing GWH buyers say has transformed how they live.

[smartcode_project:default project_id=135096 project_image_fid=356826]

For Keith, the appeal remains straightforward.

"You feel at home even before you've moved into your home."

For Aimee, the change is measured in time.

“I just felt like I had more time,” she says.

[smartcode_project:default project_id=135096 project_image_fid=351102]

Construction at ERA is now underway, with more than half of the residences already sold and limited two and three-bedroom apartments remaining in the East Tower release. Priced from $980,000 for two-bedroom residences and $1.46 million for three-bedroom residences, buyers can secure an apartment with a 10 per cent deposit, with premium homes offering ocean views from Level 8 and harbour views from Level 10.

ERA is also backed by Resilience Insurance's 10-year Latent Defects Insurance policy, providing protection against structural or waterproofing defects for 10 years after completion. The project is anticipated to be completed in early 2028.

[smartcode_project_cta:default project_id=135096]

From ONE to ERA: Why buyers are choosing GWH again in Newcastle West

Virgate Property Group is preparing to commence construction of Verdé, its new apartment development in Melbourne's Arts Precinct at Southbank, following a strong run of sales that has seen more than half of the project's 173 apartments secured.

Verdé has attracted a broad mix of first home buyers, owner-occupiers upgrading from nearby inner-city suburbs and investors, with younger owner-occupier couples aged between 28 and 45 accounting for the strongest enquiry. Many are already living in Southbank, South Melbourne, Albert Park, Port Melbourne, South Yarra and the CBD.

"Verdé is located in one of the most desirable pockets of southern Melbourne," Blair Property Group Director Darren Blair, who is managing sales at Verdé, said.

"It's within walking distance of the Arts Centre, Royal Botanic Gardens, Albert Park Lake, and Southbank's restaurants and retail. It's a great lifestyle location with strong amenity and liveability, which made it a very attractive choice for the project."

[smartcode_project:default project_id=4661 project_image_fid=372549]

Virgate was already familiar with the precinct, having previously delivered the successful Domain House development in neighbouring South Melbourne. That experience gave the developer confidence to acquire the Coventry Street site and continue expanding its presence in Melbourne's inner south.

"We had been keeping an eye on the site and the broader precinct for a few months before deciding to move forward with the acquisition," Virgate said.

The project was ultimately secured in 2020 following feasibility studies, planning assessments and due diligence, with the brief centred on delivering "a high-quality, considered design that feels both refined and fit for purpose."

[smartcode_project:default project_id=4661 project_image_fid=314259]

Designed by <a href="https://www.apartments.com.au/architects/bruce-henderson-architects">Bruce Henderson Architects</a>, Verdé comprises 173 one, two and three-bedroom apartments priced from $599,000. The architecture is distinguished by a faceted glass façade that responds to both the site's outlook and Melbourne's changing light conditions.

According to Bruce Henderson Architects, the coloured glazing gives the building a distinctive identity while also providing privacy and solar shading, with residences oriented to capture views across the bay, city skyline and surrounding parklands.

Inside, <a href="https://www.apartments.com.au/interior-designers/designoffice">DesignOffice</a> has created interiors focused on natural light, efficient planning and enduring materials. Apartments feature engineered oak flooring, natural stone benchtops, floor-to-ceiling glazing and SMEG appliances, while a restrained material palette aims to complement the expansive outlooks rather than compete with them.

[smartcode_project:default project_id=4661 project_image_fid=372550]

Resident amenity has also been designed around everyday functionality rather than occasional use. Facilities include a concierge-serviced lobby, residents' lounge with fireplace, library and co-working space, gym, terrace garden with barbecue facilities, ground-floor café, and package delivery management.

The project's location continues to be one of its strongest drawcards. Positioned on Coventry Street, Verdé sits within walking distance of the National Gallery of Victoria, Arts Centre Melbourne, Royal Botanic Gardens and Albert Park Lake, while Southbank's dining precinct, Sturt Street trams and the new ANZAC Station are all nearby. The surrounding education catchment also includes Melbourne Grammar, Melbourne Girls Grammar, Mac.Robertson Girls' High School and several major university campuses.

The sales team says buyers have responded particularly well to the combination of location, design quality and long-term liveability.

"They're responding really positively to the quality of the design, premium resident amenities and the uninterrupted views. Many also appreciate the location and how connected it is to everything they need."

The ability to secure stamp duty savings before completion has also been a key factor for purchasers, alongside the opportunity to personalise finishes ahead of settlement.

With construction set to commence soon and more than half the apartments already sold, Verdé enters its next phase as one of the Arts Precinct's more established apartment developments, offering remaining buyers an opportunity to secure a residence before construction advances further. Expected completion is scheduled for late 2027.

[smartcode_project_cta:default project_id=4661]

Virgate's Verdé Southbank moves toward construction as sales fly past halfway stage

Superannuation

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The Australian Prudential Regulation Authority (APRA) has today released a speech, ‘Enhancing Australia’s superannuation system: a vision of a sustainable future’, delivered by deputy chairman Helen Rowell to the 2017 ASFA Conference in Sydney this morning. In her speech, Rowell presented a vision for a stronger superannuation system that meets the ongoing needs of its members, and explained how changes to the prudential framework will help to deliver this. Mrs Rowell’s comments included:  
<ul>
<li>‘APRA is also taking steps to make sure that the prudential framework supports trustees delivering quality outcomes for superannuation fund members, complementing the Government’s proposed reforms. We will shortly release a consultation package outlining proposed revisions to the prudential framework, including changes to promote greater transparency, especially around expenditure, and implement member outcomes assessments for all funds.’</li>
<li>‘…the changes proposed in our upcoming consultation package are designed to put pressure on poor performers – irrespective of industry segment – to lift their game or, if the needed improvement is not possible within a reasonable timeframe, to gracefully exit the industry.’ 
</li>
<li>‘…at what point does the level of choice become more a headache than a help? It seems legitimate to ask why the industry offers members an average of nearly 200 investment options when many funds have a significant proportion of members in their default MySuper products and hence relatively few members in each o&gt;f the many choice investment options on offer.’</li>
<li>‘Our preliminary analysis of outcomes across the industry using a wide range of metrics suggests, however, that there may be some correlation between enhanced member outcomes and board composition. The trustees with outcomes at the better end of the industry, on average, appear to be those that have appointed independent or non-affiliated directors.’</li>
</ul>
The full speech is available on the website at:  <a id="LPlnk11598" href="http://www.apra.gov.au/Speeches/Pages/Enhancing-Australias-superannuation-system.aspx" target="_blank">http://www.apra.gov.au/Speeches/Pages/Enhancing-Australias-superannuation-system.aspx</a>
 
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jonathanchancellor-7SQnKwU6yx

Enhancing Australia’s superannuation system, a vision of a sustainable future: APRA's Helen Rowell

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GUEST OBSERVER
Two decades of reforms, reviews and inquiries appear to have better served the financial sector than the interests of super fund members.
At first glance Australia’s 214 major superannuation funds are performing well, giving a healthy 9.2% return on the A$1.4 trillion we have deposited with them. But there are issues with our publicly mandated but privately controlled superannuation system.
Admittedly, our current system provides a range of benefits - increasing retirement incomes, giving us plenty of choice between funds (in theory if not in practice), and investing in the Australian economy.
But the operating expenses for Australian funds consistently and significantly outstrip those in other OECD countries. Fees are high and there is little evidence that higher fees lead to better services.
In 2009 the Inquiry into Financial Products and Services in Australia recommended there be an annual check on the quality of advice. The only superannuation-related survey that has been undertaken to date found that 39% of advice was poor and only 3% was good quality. No further surveys have been conducted.
Australians are forced to contribute to superannuation funds, without the right of exit, but they aren’t protected from high fees or bad investment strategies. A nationalised superannuation system, or one that combines private and public super funds, could simplify the system and reduce costs.
<h2>Baked in problems</h2>
Australia’s system wasn’t originally intended to be entirely privately-run, which has left us without many necessary protections (such as appropriate disclosure of fees and charges).
Australia was almost alone among OECD countries in reaching the 1980s with no national employment-related retirement income scheme. There had been at least ten attempts to set one up between the 1890s to the 1970s. All failed to win support from employers, existing superannuation funds, life offices and state governments.
An additional attempt was made in the last Parliament of the Liberal government in 1972. The incoming Whitlam Labor government also tried to introduce a national superannuation scheme in 1973, establishing the Hancock inquiry.
Consistent with its recommendations, the Hawke/Keating Labor government intended to move forward with a national scheme. However, against the backdrop of past nationalisation failures, recession, high inflation, a wage freeze, strikes, declining union membership, and the increasing discontinuation of superannuation products, the government instead privatised it.
Thus, the Hawke/Keating Labor government was a major winner of a privatised scheme gaining electoral support from a coalition of private interests.
Absent from this coalition were the fund members. There is no evidence of any consultation process with either the fund members themselves and/or any consumer representative groups prior to the development of our present, privatised regime.
The Superannuation Guarantee scheme introduced a minimum employer contribution to superannuation for most employees. This scheme was a windfall for the financial sector, as they received a guaranteed, trillion-dollar stream of superannuation contributions to look after with no exit rights for members.
The union movement would also appear to be a winner from privatisation. The privatised system allowed the unions to expand the number of their existing industry funds to earn more administration and investment-based fees. The 41 industry funds currently hold A$545.2 billion, compared to the A$587.8 billion held by the 128 for-profit retail funds.
It could be argued that the losers in this mandatory regime are the fund members who were marginalised from the outset. As it was originally intended to be a government-run system, many of the administrative processes necessary for an efficient and effective privatised system were originally absent.
For example, there were no codified accounting, reporting and disclosure requirements. No mandatory requirements for the disclosure of fees and charges. No codified audit report requirements. And, for nearly a decade, the regulator did not have appropriate constitutional powers to enforce civil and criminal penalties against non-complying trustees.
Two-decades of reforms have remedied the constitutional, auditing and accounting issues. But significant issues remain, including limitations in the disclosure of fees and charges and the related issue of conflicted payments.
<h2>Alternative super systems</h2>
In theory, there are alternative superannuation models for Australia to consider. For example, there are nationalised schemes such as the government-run Canadian Pension Plan.
All of the funds from the Canadian Pension Plan are invested by Canada’s Pension Plan Investment Board, which operates with a clear mandate to maximise returns, without undue risk of loss.
Nationalising the superannuation industry in this way appears to have benefits - members would receive the same return for equal contributions, employers and employees would only have to deal with one fund, and the amount spent on running the fund (for example on administration, marketing) would be reduced.
There is also the option of adopting a combined system, as in Norway, which features both national and privately-run superannuation funds.
<img src="https://counter.theconversation.com/content/86067/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1">In reality however, given the coalition of vested interests that have forged Australia’s existing, publicly mandated, privatised system, only the voice of the members themselves can force an honest and open debate on this important issue.
Suzanne Taylor, Lecturer/Co-Ordinator, Queensland University of Technology.
This article was originally published on <a href="http://theconversation.com" target="_blank">The Conversation</a>. Read the <a href="https://theconversation.com/could-we-nationalise-the-superannuation-system-even-if-we-wanted-to-86067" target="_blank">original article</a>.
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j.ballantyne1990-6AQqhLzZaK

Could we nationalise the superannuation system even if we wanted to?: Suzanne Taylor

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The ruling coalition has used its numbers in parliament’s lower house to push through the Budget move allowing first home buyers to contribute more to their super and then use it for a deposit. 
It also says that the scheme won’t undermine Australia’s retirement savings system.
The legislation also allows older Australians to contribute the proceeds of the sale of their family home to their super, Fairfax Media reported.
The superannuation top-up scheme offers tax breaks.
Labor and the Greens are against the proposal, with the opposition saying it will do nothing to address housing affordability.
Shadow treasurer Chris Bowen said the scheme will only undermine the superannuation system, leading to a war of words with the ruling party.
Assistant minister to the treasurer, Michael Sukkar, said Labor was peddling misconceptions.
“It’s quite shocking and surprising to see any political party take a view that a tax cut for first home buyers is something that they cannot support,” Sukkar said.
Labor, however, would not oppose two other housing affordability bills announced in the budget.
The measures include limiting deductions investors can claim in relation to residential properties and slapping foreign owners with a vacancy tax if their property is vacant for at least six months during a one-year period.
Bowen said there was nothing to oppose because the measures were ineffective.
“What we see here is some minor tinkering which won’t do anything for housing affordability,” he told parliament.
 
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First home super scheme passes lower house test

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Retirement savings of 1.4 million Australians are languishing in "sub-scale" default superannuation funds, according to Financial Services Council.
Some members could be facing a $170,000 shortfall at retirement due to their inclusion in these underperforming funds, the council said.
About $94 billion is sitting in 33 default super funds that manage less than $10 billion, according to the latest research released by the council.
The council said the average return of the 33 funds over 10 years was 4.5 per cent per annum, or 1.4 per cent lower than the performance of the best performing Mysuper products.
The council said this performance gap meant a consumer could be more than $170,000 worse off by retirement if they remained in an underperforming default fund.
"If this many Australian workers were enabled by law to languish in poorly paying jobs with working conditions way below their peers, for as long as 40 years, there would be outrage across the entire community," FSC chief executive Sally Loane was cited as saying by The Australian Financial Review.
Default super funds are so called because workers who do not select a fund are put into a default fund named in their award – are not-for-profit industry funds owned by Australia's biggest unions.
Research by Chant West has said that the not-for-profit funds with less than $10 billion in funds under management have, on average, higher fees and lower returns than funds with more than $10 billion.
"Its [FSC's] analysis of scale focuses on not-for-profit funds, as the level of assets in a particular fund is a reasonable measure of scale," Chant West head of research, Ian Fryer, said.
"On the other hand, major retail providers issue many different products, and even though the assets of some products may be relatively low, those products still benefit from the scale of the organisation to some extent."
However, by Industry Super Australia's analysis of Australian Prudential Regulation Authority data for the 12 months to June 2016, default industry funds with less than $10 billion in FUM outperformed retail funds with FUM greater than $10 billion not listed in awards by 1.28 per cent over 10 years, and by 1.16 per cent over five years.
The FSC refused to name the 33 sub-scale funds identified in the research but analysis from Rainmaker based on APRA figures reveals only 27 funds in the country that have more than $10 billion in FUM.
"Some of Australia's best funds like Care Super and BT Super For Life would only just make it. But even more amazingly, top funds like Equip Super, Vision Super, Energy Super, Statewide, AustSafe, BUSSQ, ANZ SmartChoice and HUB24 wouldn't," said Alex Dunnin, Rainmaker executive director, research and compliance.
"Large funds of course have major advantages, but well managed boutique funds have repeatedly shown themselves to be amazingly competitive. Indeed a good question to ask is whether all large funds are exploiting their advantages," he said.
Other funds under the $10 billion mark include the Australia Post Superannuation Scheme with FUM of $7.4 billion, AMP Flexible Super Retirement Account with just over $9 billion and NGS Super with $7.8 billion. 
The Productivity Commission inquiry into default superannuation is looking at ways to carve up billions of dollars of super contributions under the default scheme.
Industry funds sector wants a system where the Fair Work Commission is responsible for selecting which funds are placed in the awards, while the retail sector has argued that the market should be opened up to wholesale, or near wholesale, competition.
Loane said the current Fair Work Commission default arrangement should not be tolerated.
"Many can't change funds because of the current industrial awards governing default super, and many are chronically disengaged or disinterested. Either way the system needs to change if the policy is going to work for all Australians," she said.
In its submission to the Productivity Commission's inquiry into the competitiveness and efficiency of the superannuation system, the FSC said the commission should recommend a model that allows consumers to exit underperforming funds and switch to a fund, whether it is a retail or an industry fund, that will deliver stronger returns and a more comfortable retirement.
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Financial Services Council says $94 billion sitting in underperforming default super funds

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Amid the concerns around investing in property and shares, super funds as an asset class have in general delivered double-digit returns, according to two research groups.
Super funds delivered an average 10.7 per cent return for the year to June 30, 2017, marking the eighth consecutive year of positive growth, according to research group Chant West.
Even among the super funds, industry funds performed best, returning an average of 11.1 per cent. Meanwhile, for-profit retail super funds returned 9.7 per cent, meaning industry funds outperformed their competitors for all periods out to 15 years.
The funds were resilient even in the face of political and economic shocks such as  the election of Donald Trump as US President and Brexit.
"It's been a really interesting and, in many ways, surprising year because this strong result has been achieved against a backdrop of considerable uncertainty, both political and economic,” Chant West director Warren Chant said. 
“It just shows how markets – which represent the combined views of thousands of professional investors – are able to cut through the 'noise' and focus on the investment fundamentals.”
<a href="https://www.propertyobserver.com.au/images/2017/07/20/ChantWest.png" target="_blank">Click to enlarge</a>
<img src="https://www.urban.com.au/images/2017/07/20/ChantWest.png" alt="">
Rival researcher, SuperRatings, came up with similar results, with the average fund return for last financial year topping 10.4%. 
SuperRatings estimates that $140 billion has been added to super accounts in investment earnings for the year.
“At a time when inflation hovers below 2% per annum, Australian super funds continue to far exceed expectations, with accrued earnings of well over 100% since the end of the GFC. Over the last 5 years alone, funds have averaged 10% earnings every year, more than erasing the pain of the GFC and putting retirees in a significantly improved position than they could ever have hoped for,” said Jeff Bresnahan, SuperRatings chairman.
Industry fund Hostplus topped the list with a 13.2 per cent return, with even the worst-performing fund in the median-growth category delivering 7.4 per cent, according to Chant West.
<a href="https://www.propertyobserver.com.au/images/2017/07/20/SuperRatings.png" target="_blank">Click to enlarge</a>
<img src="https://www.urban.com.au/images/2017/07/20/SuperRatings.png" alt=""> 
Funds in the median growth category have 61 per cent to 80 per cent allocation to growth assets and are usually the preferred ones. 
Funds that excelled this year tended to go against the investment trend, by having higher allocations to unlisted assets, which traditionally come at a significantly higher cost than the increasingly popular passive strategies, said SuperRatings in a media release. 
“This once again debunks the argument that low cost investment strategies are good for Australians. Low cost passive strategies will only guarantee chronic regular underperformance, which will impact retirement benefits for all Australians and undermine the superannuation system.”
The top 10 performing funds in 2016/17 covered more than 6 million Australians and all exceeded the SuperRatings’ Industry Benchmark of 10.4%, it said.
<a href="https://www.propertyobserver.com.au/images/2017/07/20/SuperRatingsOverall.png" target="_blank">Click to enlarge</a>
<img src="https://www.urban.com.au/images/2017/07/20/SuperRatingsOverall.png" alt="">
The key points to note for the 2016/17 financial year, according to Chant West were.
<ul>
<li>Hedged international shares were the strongest performing asset sector, surging 18.9%. However, the appreciation of the Australian dollar pulled this return back to 14.7% in unhedged terms.</li>
<li>Australian shares performed strongly with a return of 13.8%.</li>
<li>After being the strongest performer in 2015/16, Australian listed property was the worst performing sector this year, falling 5.6%. Global listed property fared better, but still returned just 2.2%. Unlisted property, on the other hand, had another solid year, up 10.3%.</li>
<li>Infrastructure also performed well, with global listed infrastructure up 11.1% and unlisted infrastructure delivering returns in the low teens. Private equity also provided a healthy return of 11.3%.</li>
<li>The traditional defensive asset sectors yielded very low returns. Australian and international bonds barely made it into positive territory with returns of 0.2% and 0.5%, respectively, while the return from cash was just 1.8%.</li>
</ul>
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prateek24-ezbwHMbNAk

Super funds deliver double-digit returns for eighth year in a row

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ASIC has intervened in relation to 21 superannuation trustees, representing 15 per cent of the trustee population, to improve 'Transparency Information' (TI) on their super fund websites.
Under s29QB of the Superannuation Industry (Supervision) Act 1993 (SIS Act), each superannuation fund must disclose TI on a website and keep it up to date at all times.
TI comprises remuneration, governance and other information related to the fund; for example trustee directors’ remuneration for the last two financial years, fund trust deeds and product disclosure statements, a summary of significant event notices sent to fund members in the last two years and a summary of how the trustee voted in the last financial year in relation to listed shares held by the fund.
ASIC's action follows an earlier review of transparency disclosure requirements introduced as part of the Stronger Super reforms (refer: 15-245MR), and a broader focus on ensuring superannuation trustees deliver transparent and accessible superannuation fund information.
Twenty-one super fund websites were identified as failing to meet TI requirements. Two of the super funds had assets exceeding $10 billion while the remaining 19 were smaller funds.
ASIC Deputy Chairman Peter Kell said the economic significance of superannuation meant that information about the superannuation industry should be transparent, both for fund members and gatekeepers such as analysts, advisers and journalists.
'ASIC's expectation is that super fund websites should be easily found by searching on the fund's name using an Internet search engine and that the website homepage should prominently point to the Transparency Information', Mr Kell said.
The transparency deficiencies identified in ASIC's review comprised:
<ul>
<li>no super fund website (10 funds);</li>
<li>no TI on the fund website (four funds);</li>
<li>no remuneration information (five funds); and</li>
<li>remuneration disclosed in bands, rather than for each individual executive officer (two funds).</li>
</ul>
ASIC wrote to the trustees of the 21 super funds asking them to address these transparency failures.
As a result, seven trustees disclosed the required information, five made it easier to find the information and trustees of two small funds, who did not have websites, sought relief from TI obligations.
Seven trustees transferred fund members to another fund before winding up the fund. Two trustees also improved their procedures for ensuring that TI is up to date.
Table 1 sets out the results according to TI failure type.
<a href="https://www.propertyobserver.com.au/images/2017/07/05/Screen%20Shot%202017-07-05%20at%209.59.37%20am.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/07/05/Screen%20Shot%202017-07-05%20at%209.59.37%20am.jpg" alt="">
ASIC has received applications for relief from TI obligations from two trustees that were in breach of the requirement to have a website, but no relief has been granted at this stage.
ASIC cannot give relief for breaches that have already taken place and will consider what further action may be necessary here.
'ASIC's expectations about effective disclosure that complies with the TI requirements are addressed in new MySuper FAQ D7, our earlier media release 15‑245MR ASIC reviews transparency information on super websites and other ASIC MySuper FAQs.
‘We encourage trustees to familiarise themselves with this guidance when designing or updating their super websites', Mr Kell said.
Regulations 2.37 and 2.38 of the Superannuation Industry (Supervision) Regulations 1994 specify what TI must include.
Failure to comply with TI obligations is a strict liability offence.
The 21 super funds where TI deficiencies were identified represented approximately 8 per cent of APRA-regulated funds (that are not small APRA funds).
ASIC has given industry relief and guidance in relation to the timing of the provision of information under s29QB (refer: Regulatory Guide 252 Keeping superannuation websites up to date).
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ASIC acts to improve transparency of super websites

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Household net worth increased by $227 billion to $9.64 trillion in the first quarter of 2017. 
Contrary to what you intuitively might expect, the total value of residential housing as a share of the total assets hasn't really changed all that much over recent decades, even today sitting at just a little over half. 
A big part of the reason for that has been due to the popularity and success of compulsory superannuation, while Aussies are also now hoarding some $1.06 trillion in cash and deposits, a thumping 22 per cent of financial assets. 
<a href="https://www.propertyobserver.com.au/images/2017/06/30/HW1.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/06/30/HW1.jpg" alt="">
Average net worth per capita has come absolutely storming back since the March 2009 nadir, rising by an extraordinary 67 per cent to make Australia the world's second wealthiest country after Switzerland in per capita terms.
Now someone will no doubt Tweet me to say that the housing component should be subtracted - you can do it yourself, the numbers are right there above!
Average net worth per capita increased by ~$34,500 over the year to a record high of ~$394,000.
<a href="https://www.propertyobserver.com.au/images/2017/06/30/HW2.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/06/30/HW2.jpg" alt="">
Housing loan debt also continues to rise to well beyond $1.6 trillion, making households twitchier about increases in mortgage rates than has ever been the case before. 
<a href="https://www.propertyobserver.com.au/images/2017/06/30/HW5.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/06/30/HW5.jpg" alt="">
Mortgage debt has expanded at a slower pace than asset values, however, bringing the household debt to assets ratio down to 19.5 per cent, while the mortgage debt to land and dwelling values ratio declined again to 26.4 per cent.
<a href="https://www.propertyobserver.com.au/images/2017/06/30/HW3.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/06/30/HW3.jpg" alt="">
The most noteworthy housing market change in recent months has been mortgage rates being ratcheted higher on interest-only loans.  
Given that the hikes largely took place after the end of March, it's likely that interest payable will rise throughout the remainder of 2017.
<a href="https://www.propertyobserver.com.au/images/2017/06/30/HW4.jpg" target="_parent">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/06/30/HW4.jpg" alt="">
EOFY brings super returns
It's the end of another financial year today!
After an up-and-down sort of a year at times - and assuming the share market doesn't unexpectedly crash this morning - superannuation funds will return about 10 per cent for 2016/17 to notch up an eighth successive year of positive returns, as the share market continues to claw its way back.
From a housing market perspective, almost all commentators are now on board with the notion that the Sydney market has moved into a slowdown phase, which will have knock-on effects to household net worth later in 2017.
Banks will continue to push home loans hard, but investment mortgages will be harder to come by following a raft of tightening measures. 
Yet we also shouldn't ignore that every set of labour force figures released lately has been pointing to a Sydney jobs market that is firing on all cylinders. 
Population growth accelerated to about 91,000 in Sydney in 2016, despite internal migration to Queensland. 
Meanwhile, the unemployment rate has declined to 4.4 per cent, and job vacancies in New South Wales have risen to unprecedented highs, suggesting that many more jobs are being created. 
Anecdotally, I've heard from more than one source that some professional jobs in Sydney are attracting dozens if not hundreds of applications, though whether the applicants are unemployed, under-employed, or from interstate, who can say? 
With first homebuyers sitting out of the market in recent weeks awaiting the introduction of new incentives - applicable to established properties priced up to $800,000 from 1 July - I wouldn't yet rule out a resurgent Sydney housing market later in 2017, at least in the bottom quartile of the market.
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pwargent-M4siyDbqQY

Mortgage rate tweaks set to bite: Pete Wargent

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GUEST OBSERVER
The countdown to 1st July 2017 begins and people need to act now.
Starting 1st of July, superannuation legislation will change in Australia and everyone needs to understand how the changes will affect them.
Australians are encouraged to plan ahead with the upcoming super changes such as the $1.6 million transfer balance cap, removal of tax exemption for transition-to-retirement pensions, cut in annual concessional (before-tax) contributions cap to $25,000 and catch-up concessional contributions over 5 year period from July 2018, among others.
One advantage to the annual concessional before-tax contributions cap cut is the catch-up concessional contributions.
However, it will not start until 1st July 2018. Unused portions of the concessional cap every year will be allowed to be carried forward for up to five years if you have an account balance of $500,000 or less.
Australians who consider making super contributions starting July 2017 should know that the annual concessional before-tax contributions cap will be a lot lower than previous years, dropping to $25,000 from $30,000 for people under 50 and $35,000 for those over 50.
Starting 1st of July 2017, more Australians will pay double contributions tax (15% + 15%) because of the lowering of the income threshold from $300,000 to $250,000.
Those with adjusted taxable income of over $250,000 will have extra contributions tax and all concessional contributions will have 30% tax instead of 15%. Those in certain public sector funds will be hit with this extra tax which will raise $2.5 billion in four years.
According to the government, only a small number of affluent Australians will be affected by the superannuation changes.
The 2016 budget claims that the changes will affect only 4% of people in super but some disagree, saying it will impact a lot more people than the government expects.
Other issues include estate planning and succession.
Where the death benefit exceeds $1.6 million in estate planning, the excess should be cashed out as a lump sum. Those who wish to retain the superannuation benefits through reverting or paying a pension to their dependents upon inheritance will also be affected.
Those who are in second marriages and wish to make provision for children from a previous marriage will also be impacted.
People have already structured their estate to give pension to their children from their superannuation while the spouse can access the balance as well. With the $1.6 million cap, funds may no longer be enough to sustain the pensions and spouse’s standard of living.
The superannuation changes may be plugging revenue holes instead of building a sustainable system, which can provide for retirement adequately.
This may even result in bigger demands on public finances down the line. People may be discouraged to build their super and find other investment vehicles instead. They may turn to residential property investment but housing affordability remains an issue.
The good news is that superannuation will be more flexible for those with different work patterns as the new caps will be eligible for tax deductions.
This will be beneficial to those who salary sacrifice, who are self-employed and have part-time work.
 
Ed Chan is the founding partner of <a href="https://www.chan-naylor.com.au/" target="_blank">Chan &amp; Naylor</a>.
 
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echan-hSGJw4wwC5

Superannuation changes and their impact on estate planning and succession: Ed Chan

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Listed fractional investment fund manager DomaCom Ltd is seeking a Federal Court ruling to declare that its sub-funds are not in-house assets or related trusts for the purposes of the Superannuation Industry Supervision Act. 
Such a ruling would confirm that SMSFs can invest in property sub-funds where the tenant of the underlying property is a related party of the SMSF, the fund said in an ASX statement.
It said that DomaCom subsidiary DomaCom Australian Limited has “supported  an action in the Federal Court for a declaration that DomaCom sub-funds are not inhouse assets or related trusts for the purposes of the SIS (Superannuation Industry Supervision) Act”. 
DomaCom chief executive Arthur Naoumidis noted that the ability to use superannuation to help people into a home was a topical issue and DomaCom Fund could play a key role in solving it while still protecting SMSF assets. 
“The unique arm’s length structure of the DomaCom Fund protects the SMSF assets whilst generating commercial rates of income and capital return that the underlying residential property delivers,” he said.
Gen X/Y investors could use residential property as an anchor asset class for their superannuation portfolios, expanding to other asset classes later in life. 
These investors could then rent the property and acquire more interest in the related sub-fund with time, he added.
“We have been working for several years to solve the growing problem of affordability among our young in their quest to buy a home and believe that our fund may provide the solution,” Naoumidis said.
Earlier this year, DomaCom invested in a property in Victoria’s prime Western Districts pastoral land and had 90 retail investors. 
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DomaCom seeks court ruling to exclude sub-funds from SIS Act 

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Superannuation fund returns continued their eight year bull run in April.
Boosted by international shares and a fall in the Australian dollar, the median balanced option return posted 1.4 percent.
It built on the 1.5 percent returned in March taking the financial year to date return to 10 percent.
"Even a 300 point loss on Wall St in mid-May wasn’t enough to stop the momentum with May now also looking like delivering positive returns for funds,” said SuperRatings chairman Jeff Bresnahan.
“We have not seen the strong boost in confidence many have been hoping for, but neither have we seen any sign of a sustained pullback or dramatic loss of momentum.
“Despite the fact that significant risks remain, including in the housing market, the outlook for 2017 remains somewhat positive.”
Cash and fixed interest returns remain meagre, sitting at 1.4 percent and 1.3 percent for the financial year to date respectively.
Australian and global shares have been the star performers for the financial year thus far with returns of 15.3 percent and 15.6 percent respectively.
“It would be a great result to achieve a double-digit return for the financial year, but we still have a bit longer to go,” said Mr Bresnahan.
“Volatility has begun to increase in line with continued political uncertainty globally, and market momentum is positive.
“However, investors should be careful not to under-price risk in this environment.”
<a href="https://www.propertyobserver.com.au/images/2017/05/24/Screen%20Shot%202017-05-24%20at%2010.21.24%20am.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/05/24/Screen%20Shot%202017-05-24%20at%2010.21.24%20am.jpg" alt="">
The Australian market had a mixed month in April, posting a return of 1.0 percent, weighed down by negative performance from the Materials (-0.2 percent) and Energy (-0.6 percent) sectors, and a challenging month for Consumer Staples (-2.6 percent).
The main gains came from the Industrials sector (+4.4 percent), with strong gains from Brambles (+10.6 percent) following its announcement that it is on track to meet its 5 percent sales growth target.
Another recovery story came from the much-maligned Bellamy’s, which gained strongly late in the month to post a return of 22.4 percent with the installation of new management, as well as continued demand for Australian baby formula from the Chinese market.
The US market rally continued unabated through April, with the Dow Jones Industrial Average price index posting a rise of 3.6 percent – this despite a disappointing GDP reading of only 0.7 percent for Q1 2017.
The French CAC 40 returned 7.1 percent in April as Emmanuel Macron sailed to victory in the French presidential election, while the EuroStoxx 600 Index gained 5.8 percent, as confidence in the European recovery continued to build.
“Interestingly, equity market gains have coincided with a fall in yields in major markets, as well as a fall in the US dollar,” said Mr Bresnahan.
“With valuations starting to look high in the US, investors are holding out for the President’s proposed tax cuts to be made law, which are needed to consummate the reflation trade.”
Global yields fell in April, continuing a downward trend started in the previous month.
While rates have been trending higher since October 2016 and yield curves have steepened, investors have appeared to embrace duration again, reflected in longer- term fund flow.
The US 10-year Treasury yield fell from 2.39 percent to 2.28 percent after reaching an intra-month low of 2.17 percent.
While recent CPI releases in both Europe and the US have been promising, the numbers have moderated in recent months, and core inflation remains below central bank targets.
Longer-term returns for super continue to sit close to funds’ inflation targets, with the seven-year return sitting at an estimated 7.8 percent p.a. (above most funds’ CPI targets).
The 10-year return moved lower to 4.8 percent p.a., although it remains impacted by the Global Financial Crisis, which occurred nearly ten years ago.
The point of maximum monetary stimulus has passed, signalled by the US Fed’s March rate hike, although monetary policy remains very accommodative globally, and quantitative easing measures in Europe have not yet been tapered.
Compared to a year ago, when the FYTD return was 1.4 percent, there has been a strong turnaround in returns, but the idea of returns being lower for longer is still a key point of discussion in the industry.
While inflation appears to be taking hold, it has moderated in recent months, prompting central banks, and especially the US Fed, to reconsider the pace of tightening.
<a href="https://www.propertyobserver.com.au/images/2017/05/24/Screen%20Shot%202017-05-24%20at%2010.23.21%20am.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/05/24/Screen%20Shot%202017-05-24%20at%2010.23.21%20am.jpg" alt="">
 
He noted Australian markets have been supported by fundamentals, with full-time employment continuing to grow in April, and manufacturing firmly in expansion.
However, there is also evidence of a loss of upward price pressure, partly as a result of declining energy prices and tumbling iron ore values through March and April.
The 2017-18 Federal Budget, delivered this month, presented an optimistic view of the economy, with the path back to surplus in 2020-21 predicated on a gradual lift in wages growth from 1.9 percent to 3.75 percent.
“Economic indicators remain robust, although weaker inflation figures may be of some concern to investors as well as central banks."
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