According to The Australian Financial Review, Lendlease has sold over 50 per cent of its luxury residential tower One Circular Quay in Sydney’s CBD, resulting in over $1 billion in sales to date, in what is set to become Australia’s most expensive residential tower.
The early sales are being driven by a mix of local and overseas buyers jostling for a rarely offered luxury foothold in Sydney’s center stage: Circular Quay.
Located at the former Gold Fields House site in Circular Quay, the development is part owned by Lendlease alongside Mitsubishi Estate Asia, which took a two-thirds stake in the $3 billion project in July last year.
According to The Australian Financial Review, NSW home builder Rawson, whose net loss nearly doubled to $28.9 million last year, is counting on the backing of parent company Daiwa to ride out a downturn that it says will take another six months for market confidence to return.
The state’s 10th-largest volume builder in the Housing Industry Association rankings – with 546 home starts in FY22, down from 770 a year earlier – also received a further $30 million injection from Daiwa House Australia last calendar year, on top of $40 million a year earlier.
According to The Australian Financial Review, major ASX-listed property players involved in residential development, including Lendlease, Mirvac and Stockland, can expect a boost from federal budget measures to support investment into build-to-rent projects and increase rental relief for many residents in land lease-style housing estates.
The expansion of the federal government’s home guarantee scheme for first home buyers – to allow any two people such as siblings or friends to purchase with a 5 per cent deposit – is also positive news for major developers such as Stockland and Mirvac.
The withholding tax applied to managed investment trusts used by foreign investors will be halved from 30 per cent to 15 per cent. The depreciation rate applied to build-to-rent projects will also be increased to 4 per cent a year.
According to The Australian Financial Review, house prices nationwide are poised to bounce back this year, albeit at a modest pace, after strong migration and low stock levels reversed the housing downturn earlier and quicker than expected, experts say.
CoreLogic’s home-value index for April shows Sydney house prices increased by 1.3 per cent during the month, slightly lower than the 1.4 per cent recorded in March, but a strong rebound from the 1.2 per cent decline in January, when prices bottomed out.
According to The Australian Financial Review, Sydney’s house prices rose 1.3 per cent in the three months to March, the first quarterly increase in a year and the most substantial gain since 2021, Domain data shows.
House prices in the combined capitals also rose for the first time in a year as the market reached a turning point during the first quarter.
ANZ is predicting Sydney house prices to rise 2 per cent this year and Perth to lift by 1 per cent.
Melbourne is forecast to end this year flat, but Brisbane is set to fall by 2 per cent, Adelaide by 6 per cent, Hobart by 8 per cent, Darwin by 4 per cent and Canberra by 5 per cent.
According to The Australian Financial Review, Japanese building giant Kajima has seen an opportunity to make good returns in the South Melbourne property market, after acquiring an equity stake in a $160 million mixed-use project being undertaken by local developer Lowe Living.
In exchange for investing in the project, Kajima, through its Australian development subsidiary, Icon Kajima, will earn an equal share in any profit the project generates.
The Woods Bagot-designed development, which was approved in just four months by the City of Port Phillip, comprises a 2000 sq m two-level commercial office building with an adjacent car park, 1000 sq ms of ground-floor retail space, and 36 one, two and three-bedroom apartments.
According to The Australian Financial Review, Australia’s largest cities need to plan their longer-term housing supply around train stations to enable sustainable denser development, otherwise they will lose out in the global competition for people and investment.
New KPMG analysis shows that Sydney especially and Melbourne – to a lesser extent – have developed housing close to railway stations in recent years, but that in the longer term they will need to do more.
Over the 15 years to 2021, Greater Sydney developed 430,000 additional homes of which almost half – 49 per cent – were located within 1 kilometre of a train station.
According to The Australian Financial Review, the housing price downturn is over for Sydney and Melbourne, according to the key property data analysts, who have called the bottom of the market, saying the record return of migrants would bolster prices.
While some housing economists said prices might still have further to fall – if interest rates continued to rise – even those who aren’t yet calling a bottom said the faster than expected return of immigration after the pandemic would underpin the housing market.
“Immigration is going to be stronger than developers anticipated some 12 to 24 months prior, and we saw in the 2000s how unexpected immigration can be a fillip to prices,” said Challenger chief economist Jonathan Kearns, a former head of financial stability at the Reserve Bank.
According to The Australian Financial Review, Japanese telco giant Nippon Telegraph and Telephone Corp has struck the first significant housing site deal in Melbourne this year after agreeing to pay about $45 million for a former egg farm in South Morang.
It is the fourth major land deal struck by NTT in Melbourne, after it acquired a large site on Donnybrook Road in Melbourne’s north for more than $100 million in July 2021 to add to two sites acquired in 2020.
According to The Australian Financial Review, a dramatic slump in new home sales will exacerbate the national rental and affordability crisis and put further pressure on the ability of new housing supply to meet future demand, the Urban Development Institute has warned in its latest State of the Land report.
According to the benchmark report, over the 2022 calendar year, greenfield lot sales almost halved and settled apartment sales fell to their lowest level since the global financial crisis as buyer demand plummeted, thanks to higher interest rates, surging construction work and fears about builder failures.
With both house-and-land and new apartment sales expected to be subdued again this year, the UDIA forecasts that dwelling completions will “retract sharply” and fall about 50,000 below the 200,000 dwellings needed annually to meet the federal government’s plan to build 1 million homes over five years from 2024 under the National Housing Accord.
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