Local developer Harridan is seeking to turn its Woolloongabba apartment project into the first stage of a broader transformation of Burke Street, using a new 16-storey mixed-use building to establish a greener pedestrian connection toward the rapidly evolving Boggo Road transport and knowledge precinct.

The South East Queensland developer has filed plans for 154 apartments on the <a href="https://www.apartments.com.au/new-apartments/4-burke-street-woolloongabba-qld-4102">southern side of Burke Street</a>, where its proposal has been designed alongside a wider vision by LatStudios for the street.

That vision positions the southern side of Burke Street for buildings of 15 storeys and above, while envisaging lower-rise development of up to five storeys on the northern side to transition into Woolloongabba's existing character housing. It also proposes wider pedestrian verges, deep planting, new street trees and upgrades to the pedestrian approach to Boggo Road Station.

The Harridan development itself has been designed by Brisbane-based Arqus Design and will comprise 154 apartments across 16 storeys. The mix is weighted heavily toward two-bedroom apartments, with 121 proposed alongside 10 one-bedroom and 23 three-bedroom residences. There will typically be around 14 units per floor.

A lower-ground car park and three podium levels will accommodate 156 resident parking spaces, along with visitor and commercial parking. There will also be 154 resident bicycle spaces and 40 visitor bicycle parks.

&nbsp;

Harridan is a family-owned developer and part of the Holmwood Highgate Group, with more than three decades of development activity across South East Queensland. Its portfolio spans residential, commercial and industrial property, with current residential projects including Riverbank on Byron in Bulimba, Esperance Residences in Carina and The Precinct at Kinross Road in Thornlands.

Wooloongabba has been popular for apartment developers, particularly since the announcement of the 2032 Summer Olympics games in Brisbane.

While there have been a lot of development applications, it has failed to materialize into real supply.&nbsp;

Sarazin has been the major player in the area. They are under construction at Murcia Residences, on the fringe of East Brisbane and Woolloongabba. They have just launched <a href="https://www.apartments.com.au/new-apartments/the-stanley-residences-woolloongabba-8-trafalgar-street-woolloongabba-qld-4102">The Stanley Residences</a>, in Woolloongabba on Trafalagar Street. They also have Nuage coming soon on the nearby <a href="https://www.apartments.com.au/new-apartments/nuage-woolloongabba-14-wellington-road-woolloongabba-qld-4102">Wellington Road</a>.

Joel Robinson

First look: Harridan plans Burke Street transformation beside Boggo Road transport hub

IN BRIEF

<ul>
	<li>
	Just three double-storey Sky Homes sit at the top of The Waterline, each with its own private marina berth and rooftop terrace.
	</li>
	<li>
	Construction on The Waterline is complete, with the first residents expected to move in from mid-October.
	</li>
	<li>
	Sky Homes range from 282 sqm to 367 sqm and are priced from $3.65 million.
	</li>
</ul>

<hr />
Lewis Land has opened the first completed sky home for inspection at Harbour Shores, giving buyers their first opportunity to step inside one of just three double-storey residences crowning The Waterline.

Each sky home comes with its own private marina berth, rooftop terrace and Broadwater views, combining the scale of a larger home with direct access to the boating lifestyle that underpins the wider <a href="https://www.apartments.com.au/new-apartments/harbour-shores-biggera-waters-564-oxley-drive-biggera-waters-qld-4216">Harbour Shores</a> masterplan.

[smartcode_project:default project_id=113271 project_image_fid=366708]

Lewis Land Head of Development Michael Long said the inclusion of a berth with every Sky Home had become increasingly valuable as marina access across the Gold Coast tightened.

“Marina berths are becoming increasingly difficult to secure across the Gold Coast, so including one with every Sky Home makes this a genuinely rare offering,” Long said.

“The private 70-berth marina will accommodate boats up to 12 metres in length and is positioned just 2.5 kilometres from the Broadwater, placing the open ocean only 15 minutes away.

“Being able to step out of your home onto your boat is a rare luxury, and it’s something residents here can look forward to when it opens later this year.”

[smartcode_project:default project_id=113271 project_image_fid=366709]

The display opening comes as construction completes on The Waterline, with the first residents expected to move in from mid-October.

The three Sky Homes range from 282 sqm to 367 sqm and each feature three bedrooms, three bathrooms, multiple living zones, expansive kitchens with butler's pantries and large balconies taking in the Broadwater outlook.

Each residence also has three secure basement car spaces and additional storage.

“This is the first opportunity the Gold Coast has had to step into Harbour Shores and see, touch and feel what we’re bringing to life here,” Long said.

“There are only three Sky Homes within The Waterline, ranging in size from 282sqm to 367sqm, with each residence featuring three large bedrooms, three bathrooms, multiple living zones, expansive custom-built kitchens with butler’s pantry, and large balconies capturing Broadwater views.”

<img alt="Harbour Shores" data-entity-type="file" data-entity-uuid="bab65e10-4fab-45e1-92d8-fc56e2ab98ff" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-25%20at%202.00.16%E2%80%AFPM.png?VersionId=XT8q76LsPkw3cYTsvN3JfFDaPLud90PN" />

Residents of The Waterline will have access to a private pool, along with Harbour Shores' wider collection of amenity including a lagoon pool, social clubhouse, tennis court, gym, yoga facilities and sauna.

Lewis Land partnered with Studio Collective to furnish the completed display, with the interiors designed to demonstrate how the residences could function as permanent homes rather than simply as show apartments.

Studio Collective Director Melissa Park said the surrounding waterways informed the interiors, but in a more restrained way than a traditional coastal scheme.

“We drew inspiration from the canals and coastal surrounds, but our approach was to interpret that subtly through layered materials and a grounded palette of earthy tones, rather than literal coastal references,” Park said.

“We introduced hero moments of green and teal to reference the surrounding waterways, while mirrored elements help reflect natural light.

“The result is a residence that feels elevated yet comfortable, somewhere buyers can genuinely imagine themselves living, entertaining and unwinding.”

Sky Homes are priced from $3.65 million.

Lewis Land is also offering private marina berths with The Residences, its limited collection of three and four-bedroom villas positioned directly along the Harbour Shores waterfront boardwalk.

Three-bedroom villas are priced from $2.99 million, while four-bedroom residences start from $3.19 million.

Harbour Shores is being marketed by Colliers International.

[smartcode_project_cta:default project_id=113271]

Lewis Land opens sky home display as The Waterline completes at Harbour Shores

St Vincent de Paul Society Housing Australia has filed plans for a major mixed-use housing precinct on the southern edge of the North Sydney CBD, adding another significant proposal to a pocket around North Sydn​ey Station that is quickly becoming one of the LGA's busiest development zones.

The State Significant Development Application covers a 5,990 sqm site at <a href="https://www.apartments.com.au/new-apartments/1-19-mackenzie-street-lavender-bay-nsw-2060">1-19 MacKenzie Street and 211 Blues Point Road in Lavender Bay</a>, immediately south of Nor​th Sydney Station and between the commercial core and the lower-rise Lavender Bay Heritage Conservation Area.

Designed by Wardle, the proposal would deliver a new residential tower comprising 88 build-to-sell apartments and 19 affordable apartments, alongside a separate co-living building with 57 rooms and a building manager's studio.

It would also see the significant restoration and upgrade of St Francis Xavier Catholic Church, the adaptive reuse of the former school building, new parish facilities, retail, a new public square and around 1,000 sqm of publicly accessible open space.

<img alt="Vinnies North Sydney" data-entity-type="file" data-entity-uuid="d5dd7f87-a617-463e-b577-17541e01f0e9" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-26%20at%209.10.13%E2%80%AFAM.png?VersionId=4R8TsFN3P_LrrXO2HswTOIrx2blil8lh" />

The project is seeking a concurrent rezoning of the site to R4 High Density Residential and an increase in the maximum building height to allow a tower reaching RL120, or up to 20 storeys. The proposal was progressed through the NSW Government's Housing Delivery Authority pathway.

The build-to-sell component will be weighted toward larger apartments, with just six one-bedroom apartments compared with 31 two-beds, 43 three-beds and eight four-bedroom residences.

The 19 affordable apartments will comprise two studios, 15 one-bedroom apartments and two two-bedroom apartments, taking the total apartment component to 107 residences before the 58 co-living rooms are included.

<img alt="Vnnies" data-entity-type="file" data-entity-uuid="7d568ca5-cb90-4e18-96c6-d9795dba0c56" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-26%20at%209.10.05%E2%80%AFAM.png?VersionId=GY2R5M9VtQh0EKy1vajaea19PSLOPuRD" />

Wardle's design for the Vinnies site has sought to negotiate that emerging high-rise context while retaining the lower-scale character of MacKenzie Street and the adjoining heritage conservation area.

The main building adopts a three-storey podium and tower arrangement, with the podium aligned to the ridgeline and front setback of St Francis Xavier Church.&nbsp;Wardle has designed the podium with colonnades, seating, recessed entries and active ground-floor frontages, with sandstone-toned precast concrete and face brick referencing the materiality of the existing church.

The tower then steps back eight metres to the south and six metres to the north before rising in a sculpted form comprising four interlocking quadrants. Wardle has also introduced rounded forms and chamfered corners to reduce the tower's perceived bulk and improve view sharing with neighbouring development sites.

Resident facilities and outdoor areas are planned at the separation between the podium and tower at Level 3, oriented toward Sydney Harbour and the CBD skyline.

The tower itself will feature a glass reinforced concrete facade, with recessed balconies and deep reveals used both to provide shading and privacy and frame views toward the harbour and city. The lower levels take a different architectural approach, using brick and sandstone-toned finishes intended to establish a stronger relationship with St Francis Xavier Church. The Church itself will be conserved and upgraded for its continued use, while the former school building will be adaptively reused as part of the co-living component.

<img alt="Lavendar Bay" data-entity-type="file" data-entity-uuid="2d4418ad-90aa-4d49-af93-c80b140aea80" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-26%20at%209.09.47%E2%80%AFAM.png?VersionId=Kv4gzbsACaGvZSRuaqcfGC54jEJRXIDJ" />

&nbsp;

The proposal adds to an increasingly concentrated pipeline of residential development around Blue Street, MacKenzie Street and Lavender Bay.

Just west of the site, Central Element lodged plans earlier this year for one of the most significant residential developments proposed in Lavender Bay in recent years.

Central Element's SJB-designed scheme at 64-66 Lavender Street and 3-7 Middlemiss Street would deliver 163 apartments across two towers rising 23 and 32 storeys, replacing five existing apartment buildings containing 32 homes. The project also forms part of the Housing Delivery Authority pathway.

<a href="https://www.apartments.com.au/news/nsw/first-look-central-element-reveals-lavender-bay-apartment-plans?utm_source=chatgpt.com" rel="noopener" target="_blank">First look: Central Element reveals Lavender Bay apartment plans</a>

Immediately around North Sy​dney Station, another two significant proposals have emerged at 5 and 15 Blue Street.

Zurich Australian Insurance Properties is seeking to adaptively reuse its longstanding commercial building at 5 Blue Street, directly above North Sydney Station, rather than demolishing the structure.

Its SSDA proposes converting the building into a 14-storey mixed-use development with 62 apartments and 86 co-living rooms, together with ground-floor retail and a major refurbishment of Blue Street Plaza. The application is currently at the Response to Submissions stage.

<a href="https://www.apartments.com.au/news/nsw/first-look-zurich-targets-north-sydney-office-conversion-with-148-unit-proposal-above-metro-station">First look: Zurich targets North Sydney office conversion with 148-unit proposal above Metro station</a>

&nbsp;

First look: Vinnies files for 20-storey Lavender Bay apartment tower as North Sydney housing pocket heats up

When the opportunity arose for South Australian developer Palumbo to return to Kent Town, where it had previously delivered East Park Apartments and the East 
Rundle Apartments, it wasn't one the longstanding developer-builder was going to pass up.

The decision was quickly vindicated, with more than 30 apartments sold within the first month of launching <a href="https://www.apartments.com.au/new-apartments/royal-apartments-kent-town-2-8-north-terrace-kent-town-sa-5067">Royal Apartments</a> to the market.

The 206-apartment development, which will bring significant new supply to Adelaide's tightly held eastern city fringe, also gives <a href="https://www.apartments.com.au/developers/palumbo">Palumbo</a> the opportunity to bring new life to one of Kent Town's most recognisable watering holes.

[smartcode_project:default project_id=6109 project_image_fid=376073]

Royal Apartments incorporates the historic Royal Hotel, a venue Palumbo Managing Director Daniel Palumbo said has a longstanding connection with the local community.

"Everyone in the area has history with the Royal Hotel," Palumbo told Apartments.com.au.

"It was quite an active pub and social gathering place for locals. We want to bring it back to its former glory."

[smartcode_project:default project_id=6109 project_image_fid=376072]

The wider development will comprise two residential towers alongside the restored hotel, sitting on North Terrace opposite the Adelaide Park Lands.

For Palumbo, the project also marks a return to familiar territory.

The developer completed East Park Apartments next door more than a decade ago and jumped at the opportunity to develop in Kent Town again when the Royal Hotel site became available.

"The opportunity emerged, and we moved to secure the site," Palumbo said.

"We were approached by the previous landowner, who said they had extensive commitments in Sydney and weren't in a position to deliver the project.

"We took over the site and within six months recut the design scheme to be more in keeping with the type of development we want to bring to Adelaide.

"Now we're on the market and those changes have really resonated with local buyers."

That has translated into a strong start to sales, with 33 apartments transacting in the project's first 35 days.

Palumbo said the early purchaser profile had been consistent with the group's traditional focus on owner-occupiers rather than investor-led apartment stock.

"Local owner-occupiers have always been our market," he said.

"There are always some investors, but we've never developed what would be called traditional development stock. Owner-occupiers are very much our market."

[smartcode_project:default project_id=6109 project_image_fid=376068]

The buyer mix has been diverse so far, with downsizers and younger professionals both accounting for a significant portion of early sales.

South Australia's current stamp duty settings, which allow&nbsp;eligible homeowners in South Australia aged 60 savings of up to $103,830 on stamp duty when they downsize to a new property valued at up to $2 million,&nbsp;have helped encourage downsizer activity, while younger buyers in their late 20s and early 30s have been attracted to the opportunity to live immediately outside the CBD while still being able to walk into the city.



Location has been a major part of the proposition for both buyer cohorts.

[smartcode_project:default project_id=6109 project_image_fid=376075]

Royal Apartments sits on North Terrace directly opposite the Adelaide Park Lands, with residents able to walk through the parklands toward the East End, Rundle Street and Rundle Mall.

Apartments have been positioned to capture views across the parklands, Adelaide skyline, Botanic Gardens and Adelaide Hills.

Palumbo believes the scarcity of developable land along this section of the Park Lands makes the site particularly difficult to replicate.

"There's very few allotments on that side that can be developed," he said.

"If this location was in New York and you were sitting on Central Park, you'd be talking about a $60 million apartments."

Royal Apartments will offer a broad mix of residences, ranging from one-bedroom apartments through to four-bedroom sub-penthouses and penthouses.

Current listings include one-bedroom apartments from $680,000, while larger three and four-bedroom residences are priced around $2.5 million.

Residents will have access to a swimming pool, gym, barbecue and recreation areas, residents' lounge and dining space, and a communal deck.

[smartcode_project:default project_id=6109 project_image_fid=376067]

The apartments will feature generous balconies, while secure parking, bicycle storage and storage cages will also be provided.

A porte-cochère-style arrival and drop-off area has also resonated with buyers, particularly those attracted to being able to walk into the CBD during the day while retaining secure vehicle access at home.

Palumbo is acting as developer, architect and builder on Royal Apartments, continuing the vertically integrated model it has used across its South Australian portfolio.

The group was also behind the $150 million Sofitel Adelaide, the 251-room five-star hotel and residential tower which opened in 2021.

Palumbo said Royal's launch had come at an interesting time for the broader Adelaide apartment market.

Buyer confidence had initially been impacted by uncertainty surrounding the Federal Budget and broader economic conditions, but Palumbo believes sentiment is beginning to improve against a backdrop of significant investment flowing into South Australia.

He pointed to increased activity across defence and resources, including Olympic Dam, as potential long-term drivers of the state's economy and housing market.

"Money is starting to flow into Adeliade, significant amounts as Adelaide bucks the trend of the rest of the country.," Palumbo said.

"There's a lot of activity in the economy over the next decade. I think more investment will come into this market."

Early works on Royal Apartments are expected to commence this year, with major construction activity and cranes anticipated on site from early next year.

[smartcode_project_cta:default project_id=6109]

Palumbo's return to Kent Town strikes early chord with buyers

Go-to builder-developer <a href="https://www.apartments.com.au/developers/graya">GRAYA</a> is continuing to bulk out its already impressive and diverse apartment portfolio across South East Queensland. Their latest milestone is securing development approval for Silk, its boutique riverfront apartment development in St Lucia.

The approval clears&nbsp;the way for the team to begin construction planning for the 22-residence project.

<a href="https://www.apartments.com.au/new-apartments/silk-st-lucia-16-18-sandford-street-st-lucia-qld-4067">Silk</a> will rise 15 levels from an 810 sqm site at 16-18 Sandford Street, occupying a prominent bend of the Brisbane River with a prized northern aspect across Orleigh Park toward the Brisbane CBD.

The approved scheme will comprise 16 split-floor and six full-floor residences, continuing GRAYA's move into larger-format apartment developments targeting Brisbane's prestige owner-occupier market.

The project has been designed around the site's broad river frontage and dual-direction views, with GRAYA prioritising larger residences, privacy and outlook over apartment yield.

<img alt="Silk St Lucia" data-entity-type="file" data-entity-uuid="aa5c2349-f96c-4914-a812-1f2cd6827af8" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-26%20at%208.25.44%E2%80%AFAM.png?VersionId=WY0vEU_7vYjeRJKQHiCwFdMxu8PvFh52" />

GRAYA Co-founder and Chief Executive Officer Rob Gray said the project had been shaped around local homeowners wanting to remain in St Lucia without maintaining a traditional family home.

"St Lucia is one of those suburbs people do not want to leave," Gray said.

"They know the river, the trees, UQ, the golf course, Toowong and Indooroopilly, and that familiarity is hard to replace.

"True riverfront opportunities here are exceptionally scarce. What we have designed at Silk is a way to stay in the suburb people love, with the scale and privacy of a private home and far less to maintain.

"This is not typical apartment product. It is a proper home on the river, and that is exactly what this market has been missing."

The approval comes as new apartment development continues to increase across the St Lucia and neighbouring Toowong corridor, although direct riverfront sites remain considerably more tightly held.

GRAYA Co-founder and Managing Director Andrew Gray said securing the approval had removed a significant element of development risk from Silk.

"Genuine riverfront sites of this quality in St Lucia are not something that comes up regularly," Gray said.

"The approval removes a substantial layer of execution risk, and the location underwrites demand in a way very few inner-city sites can.

"The fundamentals here are as strong as anything we have assessed in Brisbane."

<img alt="Silk St Lucia" data-entity-type="file" data-entity-uuid="d0f3d734-65e1-48e8-8ed3-2e0715ffcdd9" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-26%20at%208.25.56%E2%80%AFAM.png?VersionId=sOLSs_jdHkXLWbBKzRyayf5BfTb2vPsD" />

Silk will see GRAYA return to a stretch of the Brisbane River where it already has recent construction experience. The vertically integrated group recently completed ARC in neighbouring Toowong as builder for developer Spyre, delivering the riverfront project on a constrained site.

GRAYA will take a different role at Silk, controlling the project from design and development through construction and aftercare under its vertically integrated model.

The development will include a gym and resident leisure areas at ground level, integrated with the river's edge.

Silk joins a growing pipeline for GRAYA across Brisbane and the Gold Coast, which includes Enclave, The Gallery, Coral and Ripple.

The developer-builder has also recently lodged plans for its largest project to date, <a href="https://www.apartments.com.au/new-apartments/the-silo-19-chester-street-newstead-qld-4006">The Silo</a>, a proposed <a href="https://www.apartments.com.au/news/qld/graya-buys-frasers-newstead-site-plans-the-silo-between-james-street-and-gasworks-precincts">$700 million mixed-use development</a> in Brisbane's James Street precinct.

Silk is expected to predominantly target local owner-occupiers and prestige buyers seeking a permanent riverfront home in Brisbane's inner west.

Registrations of interest are now open, with further details on the project and construction program to be released as it progresses.

<hr />
<h2>SILK PROJECT FACTS</h2>

Developer-builder: GRAYA

Project: Silk

Location: 16-18 Sandford Street, St Lucia

Apartments: 22

Built form: 15 levels

Site: 810 sqm riverfront holding

Mix: 16 split-floor and six full-floor residences

Status: Development approved

Next step: Construction planning underway

[smartcode_project_cta:default project_id=152168]

GRAYA greenlit for riverfront St Lucia apartment development, Silk

Terry Ryder

<html><body>
EXPERT OBSERVER
Headline: House prices fell in May. Alternative headline: House prices rose in May. 
Which is right? Actually, both. Or, more correctly, it depends on whose figures you believe.
CoreLogic records a 0.4% reduction in house prices (overall, the average across the nation) during May, but Louis Christopher’s SQM Research reports a 1.1% rise in house prices over the same period.
And when the latest figures from Domain and the ABS become available, they’ll have different numbers as well.
We could spend hours discussing why different sources produce different (and sometimes conflicting) results on what’s happening with property prices. But suffice to say that they all have their own methodologies and parameters – and what they’re attempting, to distil tens of thousands of sales in myriad locations into a single growth figure, is a tad challenging.
But, ultimately, it’s doesn’t matter whether CoreLogic is right or SQM is right. Essentially, they’re saying the same thing: property prices are remarkably stubborn in the face of major negative forces. As they so often are.
House prices continue to defy the doomsday forecasters, many of them economists who refuse to let go of their flawed theories about how property prices SHOULD behave – and others among them opportunists who see potential to generate free publicity.
Here are some headlines:
<ul class="ul1">
<li class="li1">“House prices to drop 20%: AMP Capital” – The Australian, 19 March.</li>
<li class="li1">“House prices could drop by up to 20%, says UBS” – Financial Review, 18 March</li>
<li class="li1">“Prices to plunge 30% as clearance rates fall off a cliff” – The Age, 8 April</li>
<li class="li1">“House prices will collapse, says UBS” – Financial Review, 2 April</li>
<li class="li1">“Can’t rule out 30% fall in house prices, says SQM” – Financial Review, 7 April</li>
<li class="li1">“House prices could dive 30%” – The Age, 27 April</li>
</ul>
For those who declare “but it’s early days”, it isn’t.
This pandemic shemozzle, in terms of its impact on Australian life, declared itself on 20 February when the share market had its first meltdown. We’ve already been through the worst of the health impacts and the toughest of the restrictions and now we’re emerging steadily from lockdown towards increasing levels of normality.
When the price data for March (showing growth in most markets) was published, many in mainstream media said: “Yeah, but wait to we get the April figures, then we’ll see the true impact of Covid-19.”
When the April figures came out (again showing minor growth in most markets), we got the same reaction: “Yeah, but May will see prices nosediving.”
Well, that didn’t happen either. The CoreLogic data showed that in May there was growth or no change in house prices in nine of the 15 market jurisdictions (eight capital cities and seven state regional markets), with an overall result of -0.4%, while SQM reported a national rise of 1.1% and a capital city rise of 0.5%, with increases in Sydney, Melbourne, Perth, Adelaide and Canberra.
So, now the standard line from failed forecasters seeking to justify their negative stance on property markets is this: “Yeah, prices are stable for now but in September when the stimulus runs out everything will fall off a cliff.”
This comes direct from the kindergarten of real estate forecasting. It assumes that nothing will change over the next 3-4 months and that governments and lenders will recklessly turn off the tap without any regard to consequences. 
It also assumes that it’s all about JobKeeper and mortgage holidays, and overlooks the importance of infrastructure spending, loans and grants to businesses, support measures for renters, ongoing government stimulus measures like the $25,000 grant to home builders and renovators, and a whole lot more.
Australia has done well in this crisis and continues to do so. And the future belongs to those who see opportunity rather than calamity.
Terry Ryder is the founder of hotspotting.com.au
<a href="https://mailto:ryder@hotspotting.com.au">ryder@hotspotting.com.au</a>
twitter.com/hotspotting
</body></html>

terryryder-YECXbqmri2

How true are real estate price fall headlines? Hotspotting's Terry Ryder

<html><body>
Property investors will never let the facts get in the way of an entrenched attitude. 
Clinging to cherished beliefs, most of them based on myth and misinformation, is the hallmark of the typical Aussie wannabe investor - and the reason why most of them get ordinary results from buying at the wrong time in the wrong place.
Against that background, I find that the hardest sell in Australian real estate is trying to convince people that Adelaide is not only worth considering, but is one of the very best locations to target for a combination of affordability, value for money, good yields and potential for capital growth. And that regional South Australia has been one of the nation’s best performers in recent times. 
I will, nevertheless, persist.
The standout consistency of Adelaide real estate is demonstrated by our latest (Winter 2020) survey of sales activity and prices. The city’s resistance to the forces of Covid-19 is shown by the number of suburbs with sales growth and the number with annual uplift in their median prices.
The Winter 2020 survey has identified 51 Adelaide suburbs with rising sales activity. This compares with just 32 in the much larger city of Melbourne.
In terms of price performance, almost two-thirds of Adelaide suburbs have recorded annual growth in their median house prices, almost identical to the result three months ago in our Autumn 2020 survey. Once again, Adelaide is delivering on its reputation for steadiness.
Here’s what I said about Adelaide in the Price Predictor Index published nine months ago: “Adelaide is the standout market in capital city Australia. Its consistency of sales performance is remarkable and two-thirds of its suburbs have had price growth in the past year, led by double-digit rises in top-end markets.
“Adelaide is undoubtedly Australia’s most under-rated market. It keeps delivering good sales activity and above-average results on house prices.
“In the five years Hotspotting has been conducting quarterly surveys of sales activity and price trends, Adelaide has never delivered a poor result. Most cities have had peaks and troughs in that time, but Adelaide just keeps on producing steady markets with consistent demand.”
Nothing has changed, despite the negative forces of Covid-19. Adelaide and South Australia have handled the pandemic better, in health terms, than any other state and its economy has showed resilience. This has been reflected in its real estate markets.
One of the strengths of the Adelaide market is that the prosperity is widely spread across the metropolitan area. There are 10 Local Government Areas with three or more suburbs with upwardly-mobile markets.
While sources such as CoreLogic and SQM Research often report annual growth of only 1-2% in Adelaide house prices, these generalised figures disguise individual areas which have done better. Our suburb-by-suburb analysis shows that over 60% of Adelaide suburbs have median house prices higher than a year ago. 
Regional South Australia is the most surprising market in the nation. There is uplift in sales activity in most locations across the state and the vast majority of regional towns have recorded price growth in the past 12 months, with most up by more than 5%.
This market has been a consistently strong performer in recent years but is unlikely to ever receive any media recognition for it.
In the Spring 2019 edition of The Price Predictor Index nine months ago, we commented: “It would surprise many property observers to learn that three-quarters of the towns in Regional South Australia have recorded price growth in the past 12 months, including some which have achieved double-digit increases.”
In the Autumn 2020 edition three months ago we said: “Regional SA continues to perform, with significant increases in median house prices in many locations. And we now have steady upward trends in sales activity in areas that have not previously featured …”
And, notwithstanding the impacts of the pandemic period, Regional SA continues to deliver strong results. Of the 33 locations ranked in our survey, 17 are rated as rising markets, six are ranked as consistency markets and the other 10 are plateau markets.
Whyalla is continuing its recovery; Mount Gambier continues to be a growth market; and the Victor Harbor area has enhanced its status as a solid performer.
There has been a big revival in prices in Whyalla, which was previously mired in a significant downturn. In the past 12 months, growth in median prices has included 29% in Whyalla, 31% in both Whyalla Stuart and Whyalla Jenkins, 20% in Whyalla Playford and 12% in Whyalla Norrie.
To put this into perspective, these locations are rising from a very low base. Whyalla Stuart’s median house price has increased 31% in 12 months but remains at just $130,000. Whyalla Norrie’s median house price is just $145,000, despite an annual rise of 12%.
Nevertheless, prices are heading in the right direction, on the back of improved sales activity. 
Other locations to record good median price growth over the past 12 months include Tanunda (12%), Naracoorte (10%), Kapunda (11%), Millicent (10%) and Mannum (10%). In the busy markets of the Alexandrina LGA, Middleton is up 10% and Hindmarsh Island has risen 16%.
Alexandrina, south-east of Adelaide, continues to be the individual star in terms of sales activity. Most of the main centres in this municipality – Goolwa, Goolwa South, Hindmarsh Island, Middleton and Strathalbyn – have been classified as rising markets in our latest survey.
The Victor Harbor area is the other standout. This LGA often features in our reports as the steadiest of performers. In this new survey, Hayborough, McCracken, Victor Harbor and Port Elliot are all classified as rising markets. Prices are rising moderately in this market, generally around 3-5% in the past year. 
Terry Ryder is the founder of hotspotting.com.au
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Adelaide one of the best real estate performers in Australia: Hotspotting’s Terry Ryder

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EXPERT OBSERVER
Regional Queensland is becoming one of the nation’s most compelling markets. Rising numbers of locations have growth symptoms, both in terms of sales activity and price movements. Over 60% of Regional Queensland markets have median prices higher than a year ago, with apartment markets a standout.
The Sunshine Coast remains the No.1 market in the state, but other growth markets are emerging. Increasingly we are seeing recovery signs in places that were previously in downturn, including the long-suffering Gladstone market.
The one major contradiction to the overall growth scenario is the Gold Coast, which had some uplift in the lead-up to the Commonwealth Games but has faded since. In Hotspotting’s Winter survey of sales activity, we can’t find any growth momentum in Gold Coast locations – most suburbs are “plateau” markets and there is a growing number of suburbs ranked as “decline” markets.
The Sunshine Coast stands in stark contrast to the Gold Coast. The Sunshine Coast has one of the nation’s leading growth economies and its real estate market is thriving as a result.
In our previous (Autumn 2019) quarterly survey, we observed that Mackay was challenging the Sunshine Coast as the leading Regional Queensland market. That situation has re-adjusted in this latest survey, with the Sunshine Coast still entrenched as the state leader and Mackay not as prominent.
Emerging centres with improvement in their markets include Cairns, Rockhampton and the Fraser Coast, while major regional cities like Toowoomba and Townsville may be on the cusp of new growth phases.
The number of growth markets in Regional Queensland has trended higher in the past 18 months. This is despite the decline of the Gold Coast. Recovery in resources-related regional centres like Mackay, Emerald and Rockhampton is helping, while Gladstone is now showing increasing signs of improvement, with some of its suburbs rising.
Regional Queensland markets collectively have improved in the past year or so: in the past six quarterly surveys, the number of locations with growing demand has been 30, 36, 40, 45, 48 and 45. The number of growth markets had decreased sharply in the late 2017 survey but showed steady improvement in 2018 and this has continued into 2019. 
The other key feature is the number of Regional Queensland markets with price growth. Hotspotting analysed price movements in 293 markets and found 179 (61%) have median prices higher than a year ago. Of the 179 growth markets, 77 have recorded median price growth of 5% or more, while another 102 markets have increased by less than 5%.
Of the higher growth markets, 21 have increased by more than 10%, headed by the Central Queensland mining-related centre of Emerald (up 27%). But the No.1 centre for house price growth is the Sunshine Coast: 10 of the 21 locations up by 10%-plus are Sunshine Coast suburbs, led by Eumundi (28%), Sunshine Beach (15%), Twin Waters (15%) and Wurtulla (15%).
Apartment markets overall are doing particularly well in Regional Queensland. Two-thirds of unit markets have median prices higher than a year ago, headed by Airlie Beach (up 31%), East Toowoomba (36%), Broadbeach Waters (25%) and Coolangatta (20%). The Sunshine Coast is prominent here as well – headed by the iconic Noosa market which is up 24%, while Noosaville has risen 15%. In the southern part of the Sunshine Coast, Golden Beach and Warana are both up 15%.
Our analysis of sales activity confirms the status of the Sunshine Coast: 10 suburbs have rising buyer demand, while another 13 have consistent sales activity.
Cairns (pictured top) has six growth suburbs and plenty of steady performers, while Mackay has five growth markets and the Fraser Coast four. Rockhampton has emerged for the first time in several years, with five of its suburbs notable for their rising buyer activity – including Norman Gardens, Berserker and Yeppoon.
There’s further evidence of revival in Gladstone, which we first noted in the two previous (Summer 2019 and Autumn 2019) quarterly surveys. But the situation remains patchy: our ranking of Gladstone suburbs include four rising, three plateau, one consistency, two decline and three danger.
We’ve been watching the Toowoomba market for growth signs, because this is one of Australia’s largest inland regional cities and it has been a growth market in the past. The early signs of uplift are now emerging, with Newtown lifting quarterly sales from 67-82-82-91-95 over the past year or so, and Centenary Heights showing 40-40-42-52-55.
Townsville has suffered setbacks from the February floods but nevertheless has growth markets and will be boosted when work starts on significant infrastructure projects.
As we reported in previous editions, the post-Games boost predicted by some has not eventuated on the Gold Coast. This market was strong from 2015 to 2017 because of the pre-Commonwealth Games construction boom. 
Since then the growth has subsided and there are now 40 suburbs classified as either plateau or consistency markets – and eight decline markets. 
The price outcomes are also mixed for the Gold Coast: 51 markets have median prices higher than a year ago, but there are 31 with prices lower than last year.
Terry Ryder is the founder of hotspotting.com.au
<a href="https://mailto:ryder@hotspotting.com.au">ryder@hotspotting.com.au</a>
twitter.com/hotspotting
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Regional Queensland now a national property market leader: Hotspotting's Terry Ryder

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EXPERT OBSERVER
The pre-election negativity that hit real estate in the first half of 2019 impacted previously busy Regional NSW markets, with the lowest number of growth markets in two years. It nevertheless remains one of the nation’s busiest market jurisdictions. 
And price performance has been good in many locations, with 60% of Regional NSW markets delivering median price growth in the past 12 months.
Regional NSW continues to provide a stark contrast to Sydney. While many sectors of the Sydney market have been in decline, the cities and towns of Regional NSW have proved resilient – even though not as strong as in 2018.
Last year Hotspotting’s Spring 2018 survey found 70 locations with rising demand in Regional NSW and the Autumn 2019 identified 61 growth markets. But this latest Winter 2019 found only 40 growth markets – still solid by national standards but well down on the levels of the past year or two.
The sales data on which this survey is based pre-dates the Federal Election in mid-May and the subsequent positive events such as interest rate reductions, easier finance (the APRA changes) and the tax cuts.
So any locations that delivered rising sales activity in that pre-election climate have strong claims to being regarded as growth markets.
There are still growth markets in and around Newcastle (pictured above), although this market overall appears well past its peak. The Newcastle and Lake Macquarie LGAs both have suburbs with growing sales demand, but they are outnumbered by plateau markets.
But locations near Newcastle, such as the Port Stephens LGA, remain buoyant, led by Anna Bay, Medowie and Salamander Bay. Some sections of the Hunter Valley still have momentum, including Cessnock and Muswellbrook.
The same cannot be said for the Central Coast. Two years ago, this was the strongest market in NSW but it’s now well past its peak. Bateau Bay and Budgewoi still have some forward momentum, but the Central Coast now has 19 plateau markets and seven we classify as declining markets (including Toukley, Gwandalan, North Gosford, Point Frederick, San Remo and The Entrance). We note also the decline in median prices in many Central Coast locations.
Similarly, other regional centres close to Sydney have passed their peaks and started to decline, including Wollongong, the Southern Highlands and the Blue Mountains (although Katoomba remains busy). The Byron Bay market is another to have lost its mojo.
The growth markets in Regional NSW are now found further afield. The Tweed LGA at the Queensland border is particularly busy at the moment, headed by Casuarina, Kingscliff and Terranora. Quarterly sales in Kingscliff have been 59, 61, 67 and 70 – and its median house price has risen 19% to $1,025,000.
At the other end of the state, Wagga Wagga continues to be a market leader, led by upwardly mobile suburbs like Gobbagombalin, Kooringal and Lake Albert. Quarterly sales in Wagga Wagga (the suburb) have been 37, 39, 48 and 50 in the past 12 months – and its median price has started to rise, up 4% in the past 12 months.
And the Eurobodalla LGA in the South Coast region has some busy markets, notably Catalina and Malua Bay.
A large number of smaller and distant regional centres have growth markets, including Grafton, Forbes, Griffith, Wingham, Mudgee and Gulgong in the Mid Western LGA, Leeton, Lismore, Nambucca Heads and Young.
There has been plenty of price growth in Regional NSW markets, though not as prolific as in our previous survey.
Three months in our Autumn 2019 report we commented: “The vast majority of NSW Regional markets have price levels higher than 12 months ago – 85% of the locations in our survey have recorded growth in the past year.”
This Winter 2019 survey finds that 61% of house markets and 53% of unit markets have median prices higher than a year ago. 
Locations with strong price growth include three locations in the Tweed LGA – Casuarina (up 21% to $1,150,000), Kingscliff (up 19% to $1,025,000) and Tweed Heads South (up 15% to $585,000).
But the biggest growth has been recorded by Berry in the Shoalhaven region, up 25% to $1,300,000.
A number of apartment markets have recorded median price growth above 20%, including Nambucca Heads, Ballina, Sawtell and Taree.
At the other end of the scale, many Central Coast locations have recorded declines in their median prices. House markets to fall include those in Wyoming (8%), Woy Woy (5%), Umina Beach (6%), North Gosford (7%), Long Jetty (9%), Wyong (6%) and Gorokan (8%). 
Among the apartment markets, those to drop include Woy Woy (6%), Toukley (9%), Umina Beach (9%), East Gosford (12%), Gorokan (8%), Terrigal (6%) and Berkeley Vale (19%).
Some of key markets in Wingecarribee LGA in the Southern Highlands region have dropped also, including Bowral (6%) and Mittagong (10%).
Suffolk Park at Byron Bay has recorded a 17% fall in its median house price to $1,050,000.
Terry Ryder is the founder of hotspotting.com.au
<a href="https://mailto:ryder@hotspotting.com.au">ryder@hotspotting.com.au</a>
twitter.com/hotspotting
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2019 property price growth markets in Regional NSW are now found further afield: Hotspotting's Terry Ryder

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EXPERT OBSERVER
At a time when few markets in the nation are firing strongly, Regional Queensland continues to be one of the most buoyant. Multiple regional centres have growth symptoms and previously struggling resources areas are improving.
Close to 60% of locations have median prices higher than a year ago, defying the weaker performance that has been prevalent in many other markets nationwide, including many of our capital cities.
Regional Queensland has overtaken Regional Victoria and Regional NSW in terms of the number of locations with growing sales activity, despite the absence of a major contribution from the Gold Coast. 
Regional Queensland has 38 growth markets, making it the second strongest jurisdiction in the nation, after Adelaide. Partly this reflects weaker performance in other areas, including Brisbane and Hobart, and the reality that Sydney and Melbourne are only just beginning their recovery phases.
The Sunshine Coast (above) remains the No.1 market in the state, but other growth markets are emerging, with signs of uplift in Cairns, Rockhampton, Hervey Bay, Toowoomba and Townsville. Increasingly we are seeing recovery signs in places that were previously in downturn, including Gladstone.
The Sunshine Coast has 10 suburbs with growth momentum, higher than any other LGA in the nation. It also has a large number of suburbs with steady buyer demand. Individual areas continue to produce big price growth, headed by the Noosa apartment market, where the median price has increased 24% in the past year. Other growth markets include Moffat Beach (up 14%) and Parreara (up 13%).
Rockhampton has emerged in the Spring edition of The Price Predictor Index as a growth market – five suburbs have upwardly mobile markets and others have steady demand. 
The local economy is improving and this is creating a property market revival, helped by the city’s affordable prices (several suburbs have median house prices in the $160,000 to $210,000 range, and only a few are above $300,000). Seaside Yeppoon is emerging as a growth star.
The Fraser Coast region, including Hervey Bay, also has five growth suburbs and nine others with solid demand. Cairns, too, has five growth suburbs, as well as 17 with steady demand, but also three with declining activity.
The state’s largest inland city, Toowoomba, is showing the first glimpses of growth after being a fairly stagnant market in the past few years, while Townsville may be at last casting off the economic sluggishness that has stalled its market recovery.
Mackay’s rise appears to have paused, but the underlying economy is strong and we expect this market to continue to produce growth in the next 12 months.
The Gold Coast presents a number of contradictions. There are only four suburbs with growing sales momentum, but 32 plateau markets and also six suburbs classified as declining markets. It illustrates the reality that there can be multiple dynamics playing out in an individual city market.
At the same time, a number of Gold Coast suburbs have had good price growth in the past 12 months, including the house markets of Biggera Waters (12%), Maudsland (11%), Mermaid Waters (10%) and Paradise Point (14%), as well as the apartment markets in Benowa (18%), Broadbeach (16%) and Mudgeeraba (17%).
We continue to see evidence of revival in resources-related areas which have had lengthy downturns since the end of the mining investment boom. Demand has increased in Central Queensland towns like Emerald and Moranbah and so have prices, with Emerald’s median house price rising 11% in the past 12 months and Moranbah lifting 10%. Both, however, remain well below their previous peak price levels.
Gladstone is showing further evidence of a gradual fightback. There has been some uplift in sales activity and median prices have risen in South Gladstone (19%), Glen Eden (24%), West Gladstone (12%) and New Auckland (11%), but from a low base and with some way to go to make up the previous losses. 
There are also some suburbs where demand and prices are still falling, so the recovery remains patchy.
Mount Isa remains mired in downturn and its suburbs continue to be classified as danger markets. The suburb of Townview, for example, has recorded only 11 sales in the past year and prices remain lower than the levels of 10 years ago.
Overall, Queensland’s regional areas are producing plenty of price growth. Close to 60% of locations have delivered growth in their median house prices in the past 12 months – that’s 120 locations across the state with rising prices, including 44 which have grown by more than 5%.
Around 55% of apartment markets have also recorded annual growth in their median prices.
Terry Ryder is the founder of hotspotting.com.au
<a href="https://mailto:ryder@hotspotting.com.au">ryder@hotspotting.com.au</a>
twitter.com/hotspotting
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Regional Queensland real estate markets continue buoyancy:  Hotspotting's Terry Ryder

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EXPERT OBSERVER
After the weekend we’ve just had, normal transmission can resume in Australia’s property markets. Well, almost.
At the start of this month, four factors were creating a perfect storm that impacted negatively on housing markets.
Thanks to the unexpected events at the weekend, two of those are done and dusted.
A Federal Election is always a brake on activity in real estate and elsewhere. It creates uncertainty in the minds of consumers who want to see what happens before deciding on big spending commitments.
Mercifully, that’s all over and we can get on with life in an atmosphere of political certainty.
The second element of the perfect storm was the prospect of a Labor Government causing major problems in real estate with its ill-advised changes to negative gearing.
Now the housing industry can get on with business without that negative-gearing negative lurking in the background.
If the Labor Party learns anything from losing the un-loseable election, it will consign the negative-gearing policy to history and never speak of it again.
The increased difficulty in getting finance, thanks to APRA’s over-eager bureaucrats and the banks’ over-reaction to the Royal Commission, is the third element of the perfect storm. That’s the next one to get sorted.
There are growing signs that major lenders are loosening the shackles and competing for new business from investors. The ANZ Bank recently admitted it had gone too far in tightening up its criteria in assessing borrowers.
If banks fail to lighten up and make it easier to get loans at competitive interest rates, they’ll be shooting themselves in the foot along with everyone else in the housing industry.
Banking boffins aren’t the sharpest tools in the corporate shed, but there’s evidence they know they have to make it faster and easier for consumers to get the loans they need on attractive terms.
The process would be aided by a reduction in the official interest rate which, according to most analysts, is likely to happen sooner rather than later – especially given the evidence that the economy is coughing and spluttering a little. Rapid and decisive action from the newly-endorsed Federal Government, as well as the Reserve Bank, is needed.
The fourth factor, and it’s been a big one, has been the attitude of mainstream media. The big newspapers have been indulging a feeding frenzy of negative sensation, taking the downturn in the two biggest cities and turning it into a national crisis.
There have been repeated claims that prices are falling everywhere. They’re not, not even in Sydney, where there are 95 suburbs with median prices higher than a year ago and particularly strong price performance by some of the apartment markets. 
In Melbourne, 57% of suburbs with unit markets have median prices higher than a year ago, as well 36% of suburbs with house markets. That’s what our suburb-by-suburb analysis shows.
The message is even more positive in cities like Adelaide and Brisbane, and in many of our regional markets, notably Victoria and New South Wales.
Notwithstanding those facts, the big city newspapers keep telling us that prices are falling across the nation and there are regular predictions of a nation-wide collapse in prices. That needs to change because, frankly, it’s becoming boring.
More recently, the tone of the headlines has started to lighten. Writers have begun to acknowledge the gathering evidence of a bottoming of the Sydney and Melbourne downturns, with the prospect of impending recovery - while also noting that there are markets elsewhere in the country that are strong and rising.
It’s amazing how fast things can turn around. A few months from now, I expect we will be able to look back to early May and marvel at the difference in conditions and atmosphere as, one by one, those four elements of the perfect storm have been struck down.
One weekend has changed the whole atmosphere surrounding residential real estate.
Terry Ryder is the founder of hotspotting.com.au
<a href="https://mailto:ryder@hotspotting.com.au">ryder@hotspotting.com.au</a>
<a href="https://twitter.com/hotspotting" target="_blank">twitter.com/hotspotting</a>
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Get set for the four elements of the perfect property storm to be struck down: Hotspotting's Terry Ryder

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What is it about Sydney people that makes them so sensitive to interest rates when no one else in Australia is?
If we can believe popular analysis, interest rates cuts are like steroids to Sydney residents. They get all pumped up by them and charge around lifting things that were financially too heavy for them previously.
But the 81% of Australians who live outside Greater Sydney are immune. They’re exposed to the same stimulus but it has no visible effect on them. Curious modern phenomenon.
Anyone with a keen eye for observation and an inquiring mind – the qualities that journalists used to have, back in the day – might wonder why Canberra people, for example, have such a strong immunity to the rates steroid.
It certainly made me wonder, so I checked to make sure they have the same interest rates in the national capital as they have three hours up the road in the NSW capital. And, sure enough, they do.
And guess what else? They have the same interest rates in Melbourne, Brisbane, Perth, Darwin, Adelaide and Hobart as well. 
I had assumed rates must be much higher in all those places because, according to the latest figures from cor blimey RP Data, apartment prices are falling in Perth, Darwin, Hobart and Canberra – and have barely moved in Melbourne, Brisbane and Adelaide, whereas they’re up 10% in Sydney.
Here are some of the headlines since the RBA interest rates decision last week:
<ul>
<li>Rate cut adds to Sydney buying frenzy</li>
<li>Rate cut dangerous for property market</li>
<li>Rate cut could destabilize property market</li>
<li>RBA rate cut will put pressure on property market</li>
</ul>
Some of the reaction to the interest rate reduction bordered on the ludicrous. We had a slightly hysterical president of the Real Estate Institute of NSW, Malcolm Gunning, claiming the rate cut meant young people would be forced to leave Sydney. Sam White from Loan Market said the rate cut would make the market unsustainable and unaffordable.
We even had Adelaide pundits claiming the rates decisions would fire up the local property market. Why all those previous rate cuts had failed to achieve that was not explained. 
We’ve had almost four years of falling interest rates and none of those previous cuts have generated a boom in Adelaide – or anywhere else in capital city Australia, apart from Sydney - but this latest reduction is going to “fire up” the market, apparently.
So where did this notion that interest rates were the prime factor in residential real estate dynamics originate? Yes, you guessed it – it’s the love child of our under-class of chattering economists.
Watching an economist discuss real estate is like listening to a close friend of mine discuss rugby. She understands that a ball is involved but she’s never sure whether it’s round or oval - or whether you need to kick it over the bar or under it. She is sure about one thing, though - that it doesn’t make a lot of sense and far too many people are obsessed with it.
I recently spoke to a boardroom luncheon in Sydney, attended by 12 or 15 people with “economist” somewhere in their titles and all from big name companies and institutions. What they collectively knew about residential property could be written on the back of a postage stamp in crayon. In the minds of most of them, there’s a national property boom and it’s caused by low interest rates.
They’re the masters of the universe and they know close to nothing.
There’s another thought about this whole obsession with interest rates and the belief they are central to movements in property markets. Investors who are fundamentally driven by interest rate cuts are not thinking clearly. The current level of interest rates is largely irrelevant to sensible decision-making about property investment.
Anyone who borrows now to invest will face dozens of interest rate changes over the life of their loan. The current level of rates is not a core consideration. The core question for investors should be: if rates at some point rise 2 or 3 percentage points above their current levels, can I still afford the repayments?
If you’re charging around like the steroid-induced herd animals in Sydney, you’ve missed that fundamental point.
TERRY RYDER is the founder of <a href="https://www.hotspotting.com.au/">hotspotting.com.au</a>. You can <a href="https://mailto:ryder@hotspotting.com.au">email him</a> or follow him on <a href="https://twitter.com/hotspotting">Twitter</a>.
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Sensitive Sydneysiders reel at rates: Terry Ryder

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Vacancy rate figures are a leading example of how generalised data can be dangerously misleading for real estate consumers.
Research companies like to publish statistics which describe an entire city in a single figure. One might tell us that “Sydney house prices” have risen 8 percent in the past year, but what does that mean for a metropolitan area with over 700 suburbs and five million residents?
The overall vacancy rate for Melbourne is a healthy 2.1 percent, according to SQM Research, but does that make investment in the city generally safe? Behind that generalised figure lie myriad different situations, including some (like inner-city Southbank and suburban Doncaster) where vacancies are in the 5-6 percent range.
The Brisbane metropolitan area provides a sobering case study for this topic. The overall vacancy rate is 2.9 percent, which is within the accepted comfort zone.
But closer examination reveals some worrying information. The city’s generalised vacancy rate has risen from 2.6 percent a year ago to 2.8 percent in June and 2.9 percent in July.
But specific areas show much higher vacancies and it’s not just the inner-city apartment markets. The unit development frenzy has extended to the suburbs and some precincts have alarmingly high vacancy rates now.
The latest figures show the Brisbane CBD has a vacancy rate of 5.3 percent. Surrounding near-city markets including South Brisbane, Woolloongabba, Kangaroo Point and Fortitude Valley all have vacancies in the range from 4.1 to 5.8 percent.
With major projects under construction, many of these rates will get considerably worse before they get better.
But now suburban markets well beyond the inner-city high-rise precincts are joining this disturbing trend.
There is major new construction of units happening in many of the suburbs on Brisbane’s Northside, in the middle ring suburbs where houses have dominated in the past. Thousands of new apartments received council approval in the financial year just ended. 
The suburbs most impacted are Albion, Chermside, Everton Park, Kedron, Gordon Park, Wooloowin and Lutwyche. 
The Albion postcode now has a vacancy rate above 9 percent. The postcode covering Kelvin Grove, where major urban renewal projects have been targeted, has a vacancy rate above 5 percent.
The postcode covering Lutwyche and Windsor is at 4.4 percent, while Herston is 4.8 percent. 
Chermside’s vacancy rate is currently reported as 3.7 percent but is trending upwards and is likely to go much higher as there is widespread new development in this area. 
There was recent publicity for this area, based on a research report that Chermside would become a property hotspot because of projected population growth. This was based on recent residential building approvals. Property marketers weighed in, suggesting this was a good place to buy.
There’s no doubt that the Chermside precinct has many good qualities – well-established residential areas supported by major infrastructure, facilities and jobs nodes. It’s part of a precinct that I wrote about favourably a few years ago, when Brisbane Northside generally was leading price growth in metropolitan Brisbane.
But those days have passed. The momentum has shifted to other parts of the Brisbane market and, in the meantime, developers have dived en masse into the Northside market. 
All those positive qualities– population growth, good transport links, employment growth and great services and amenities – can be overpowered and rendered meaningless by one simple factor: oversupply. 
Brisbane’s overall vacancy rate of 2.9 percent does not alert us to the reality that places like Chermside have much higher vacancies, which are rising steadily and set to become worse.
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>
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Brisbane unit development frenzy hits the suburbs: Terry Ryder

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Affordability nationwide improved in the five years between 2011 and 2016 – that’s one of the more interesting facts to emerge from the 2016 Census data. 
An analysis by population analysts profile.id finds that the median mortgage payment in 2011 was $1,800 per month, but in 2016 it was $1,755. Over the same period the median household income increased from $5,330 to $6,205 per month. 
Of course, these are national average figures and they conceal myriad differences among the various states and cities. The biggest improvements in affordability, in terms of the reduction in mortgage payments, occurred in Queensland and the ACT. 
But there was even a small improvement in New South Wales, notwithstanding the big price rises in Sydney. 
Unsurprisingly, the biggest single factor in the reduction in mortgage payments was the decrease in interest rates. In 2011, the official cash rate was 4.5 percent and by 2016 it was 1.5 percent. Glenn “the Census expert” at profile.id says: “While the banks have passed on less and less of these cuts, it’s certainly the case that mortgage interest rates being paid by home owners in the past five years have reduced.” 
Perhaps the most startling fact is that the median mortgage payment for the Greater Sydney area was the same in 2016 as it was in 2011. And in Melbourne the median mortgage payment reduced slightly. 
The analysis examined mortgage payments for people aged between 18 and 34 who have a mortgage and don’t live at home with their parents – i.e. looking at the profile most likely to include first-time buyers. This is where the improvement in affordability was actually the highest, in terms of the reduction in median mortgage payments between 2011 and 2016. 
In the ACT, for example, median monthly payments dropped from $2,460 to $2,140, while in Queensland they fell from $2,165 to $1,958. Even in NSW, the median mortgage payment for this demographic dropped from $2,182 to $2,129. 
As Glenn points out: “There are very large falls in mortgages in the ACT ($320/month) and Queensland ($207/month). But even in Sydney and Melbourne, which have seen rapid escalation of housing prices, there have been modest declines in what 18-34 year olds are actually paying on their mortgages when they have them. 
“So in fact, a larger part of the decline (in mortgage payments) is in this key group. Probably because they have the larger mortgages and are more affected by changes in interest rates. So, while we have seen that children are delaying leaving home longer (though not much longer), once they do leave home they are actually paying less to buy a house.” 
These figures put another perspective on the general issue of housing affordability. 
But here’s the thing: every day the Hotspotting team scours media sources for information on residential real estate and, to date, we haven’t found any coverage of this very thorough and professional analysis of the affordability situation. 
No newspaper or other media outlet has run this story. Why not? Because it doesn’t suit the pre-conceived storyline, the much-beloved theme of everyone being priced out of the market. 
Another reflection of media bias on this subject came earlier in the year when one of the major affordability indexes published the latest findings. There were two scenarios: in annual terms, affordability had improved in most states and territories, but comparing the latest quarter to the previous quarter, affordability had declined in most states and territories. 
Every media outlet which ran an article in this report focused on the quarter-to-quarter deterioration and totally ignored the annual improvement. 
Media has created a “crisis” by selectively using data to support the favoured theme which says no one can afford to buy any more. It’s obviously rubbish but that’s what they keep telling us – and so when someone runs a survey on the issue, a majority of citizens say they believe young people are priced out of the market everywhere. 
It’s sad how dishonest our media is and also sad how easily people are deluded by it. 
Terry Ryder is the founder of <a href="https://www.hotspotting.com.au/" target="_blank">hotspotting.com.au</a>. You can <a href="mailto:%20%3Cscript%20type='text/javascript'%3E%20%3C!--%20var%20prefix%20=%20'ma'%20+%20'il'%20+%20'to';%20var%20path%20=%20'hr'%20+%20'ef'%20+%20'=';%20var%20addy38821%20=%20'ryder'%20+%20'@';%20addy38821%20=%20addy38821%20+%20'hotspotting'%20+%20'.'%20+%20'com'%20+%20'.'%20+%20'au';%20document.write('%3Ca%20'%20+%20path%20+%20'/''%20+%20prefix%20+%20':'%20+%20addy38821%20+%20'/'%3E');%20document.write(addy38821);%20document.write('%3C//a%3E');%20//--%3E/n%20%3C/script%3E%3Cscript%20type='text/javascript'" target="_blank">email him</a> or follow him on <a href="https://twitter.com/hotspotting" target="_blank">Twitter.</a>
 
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Affordability actually improving in terms of mortgage payments: Terry Ryder

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Price growth in the outer ring suburbs of Melbourne has been extraordinary in the past 12 months.
Most suburbs in local government areas (LGAs) like Wyndham, Hume, Whittlesea and Casey have recorded double-digit growth in the median house prices. Many have grown more than 20% and some have topped 30%.
The big price rises have come on the back on massive demand for homes from buyers of all sorts chasing affordability, against a background a strong Victorian economy and continuing high population growth. 
The strength of the growth in the outer-ring areas of Melbourne provides further evidence that proximity to the CBD is not an essential factor for buyers seeking capital growth.
Proximity to employment is a core factor but the reality is that most people work in suburban jobs nodes, not in the CBD (that’s true in all capital cities, including Melbourne).
In the City of Casey in the far south-east of the Melbourne metropolitan area, eight suburbs have each recorded over 330 house sales in the past 12 months. 
They include Narre Warren, Clyde North and Cranbourne North, which have each recorded more than 450 house sales, and Berwick where over 700 houses have been sold in the past year. 
Every suburb in the Casey LGA has had double-digit growth in median house prices. Cranbourne, Hallam, Cranbourne East, Hampton Park and Narre Warren have all had median price growth above 20%.
It’s been a similar scenario in the Whittlesea LGA in the far north of the Melbourne metro area. Four suburbs have had over 400 house sales each in the past year and five more have each sold between 225 and 300 houses. 
All the suburbs of Whittlesea have had double-digit growth in their median house prices, including four (Epping, Lalor, Mernda and South Morang) which have grown 20-25% and one (Thomastown) which has risen 33%.
The pattern is similar in the neighbouring Hume LGA. Broadmeadows, Greenvale, Meadow Heights and Roxburgh Park have each sold between 200 and 350 houses, while Craigieburn had made over 500 house sales. 
All the Hume suburbs have had double-digit growth in their median house prices, including six suburbs which have grown more than 20%. They include Jacana (up 26%), Gladstone Park (up 24%) and Broadmeadows (up 29%).
Most of the suburbs of the Melton LGA in the far north-west have each sold over 200 houses in the past year, led by Melton West (335) and Caroline Springs (343).
Every suburb has recorded at least 12% growth in median house prices, while Melton and Melton South are both up 27%.
But, in terms of turnover, the star market is Wyndham City in the south-west heading towards Geelong. 
The sales turnover is prolific in Hoppers Crossing (682 house sales), Wyndham Vale (436), Tarneit (684), Werribee (791) and in particular Point Cook (953).
All of the five suburbs mentioned have grown their median house prices at least 13% in the past year, led by Hoppers Crossing (up 21%) and Werribee (up 22%).
The important lesson is that downmarket, outer-ring areas do record strong price growth and that affordability is a prime driver of activity and prices. That’s especially so in places where the infrastructure is good.
Terry Ryder is the founder of hotspotting.com.au
<a href="https://mailto:ryder@hotspotting.com.au">ryder@hotspotting.com.au</a>
twitter.com/hotspotting
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Terry Ryder

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