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News.com.au
2 days ago
- Business
- News.com.au
Dan Andrews' ‘ghost' home legacy revealed as apartment towers stall
Thousands of Melbourne apartments have been abandoned or heavily delayed in a blow to the Victorian government's hopes to build its way out of a housing crisis. Families who have been waiting years for their next home are now having contracts torn up as the state's development woes worsen. Surging building costs and Daniel Andrews-era policy decisions have combined to turn huge numbers of the state's apartment pipeline into 'phantom approvals', with Victoria now ranked as one of the worst places to build units. Packer's $100m play to live longer Australian Bureau of Statistics data analysis shows one in six apartments approved for construction around the nation have still not been commenced two years later, with experts warning it is significantly worse in Victoria. By contrast more than 95 per cent of houses approved are built, as are similar numbers of townhouses. MCG Quantity Surveyors research shows that home completions in Victoria are on track to reach about 56,000 in 2025, which is 10,000 (15 per cent) below the state's peak of 66,000 in 2017. It is significantly short of the 76,000 annual home build target to meet obligations under the National Housing Accord's 1.2 million home target by 2029, and even worse when contrasted with the state government's own 80,000 homes a year goal for the next decade. MCG Quantity Surveyors director Mike Mortlock said the data showed far fewer homes were being built than officials citing approvals data were claiming. 'We need unit construction to be outperforming targets. The reality is the opposite,' Mr Mortlock said. Their figures show Melbourne's south east has a less than two month supply of new apartments, while there is just over three months' supply headed to the Mornington Peninsula, followed by the city's inner east where there is an about four-month supply of units. Mr Mortlock said there were multiple 'headwinds' to unit construction that were not as prevalent only a few years ago, a key one was that 'governments at all levels have become drunk on property taxes'. Housing Association Industry chief economist Tim Reardon said many of the multi-unit projects approved in Sydney, Melbourne, Brisbane and other big city markets were 'phantom approvals'. 'For apartment building to increase meaningfully, we would need to wait for established units to become so scarce that the prices would catch up with those for new units,' Mr Reardon said. 'It could take years.' He noted that a key contributor to phantom approvals issue was increased taxes on foreign investment into new housing projects, with Daniel Andrews the first premier to increase stamp duty on internationals in 2015. 'These taxes are the goose that killed the golden egg,' Mr Reardon said. 'It's one of the worst housing policy own goals. Removing the taxes would see significant increases in the homes getting built.' A number of major Victorian projects have suffered as a result of international investment taxation as well as rising building costs. Buyers who have splashed as much as $35m on homes in 2022 for what was planned to be Australia's tallest skyscraper, STHBNK By Beulah, are now in limbo after the project manager BSSPV Pty Ltd was placed in voluntary administration in February. While it has since exited administration, the site is still waiting on the outcome of an expressions of interest with developer Beulah International looking to either sell the site or establish a joint venture for its continued development. Aspects of the Malt District redevelopment of the Nylex Clock site in Cremorne also remain undeveloped, years after its developer, Caydon, collapsed. In Alphington, Glenvill's YarraBend stopped sales for a development titled the Glass House as the cost of building soared, and while most buyers took back their deposit in the years that followed the building's launch to sales in 2022, one couple finally had their contract torn up in March this year. 'We stopped sales when we found out where building prices were headed,' said Glenvill sales and marketing director Sam Tucker. Mr Tucker added that the Glass House was being redesigned and going back through council planning and would be included as part of its Boiler House complex, with apartment sizes and formats to be revised – including the removal of most one-bedroom offerings which had become far more difficult to sell with prices touching on $700,000 due to building cost increases. Glenvill have been able to continue with other developments within the wider YarraBend infill project and a separate complex with close to 200 homes is due to reach settlement in the near future. Conveyancer Andrew Curtis worked with a number of buyers affected by the project's cancellation and said he was seeing a rise in the number of people buying off-the-plan apartments only to have their contract rescinded years later. 'The vast majority of developers, you don't run into these sort of problems; and a lot of this was impacted by Covid,' Mr Curtis said. 'But the issue is becoming more common. 'And it is going to get worse. The building costs are still ridiculous and that's still causing a lot of issues for builders in the industry.' In many instances, the conveyancer said stalled or abandoned developments would likely have gone ahead if not for the Daniel Andrews-era policy increase to stamp duty for international investors. 'One of the reasons these projects are running into trouble is that they aren't selling to offshore investors,' Mr Curtis said. Charter Keck Cramer national executive director of research Richard Temlett said building costs had increased by 30-50 per cent, adding hundreds of thousands of dollars to the cost of many projects, with the state's tax regime also a major factor in development woes. 'Rather than tax at 5 per cent and nothing gets built, if they taxed at 2.5 per cent and 10 times the number of homes get built, they would at lease get some revenue,' Mr Temlett said. 'Melbourne is the weakest apartment market right now, because of the loss of overseas revenue. And that's one of the biggest missteps the government has made and we are now seeing it. 'It's all things lingering from the Andrews era.' He noted buyers looking for certainty in the apartment sector could still look for well-funded groups and those with a listing on the Australian Stock Exchange as a way to find groups more likely to be able to proceed with projects in a timely way. Australian Property Development Association president Alex Huang said Victoria had become 'probably one of the worst places that a developer can pick to launch a project'. Over the past year he said he was hearing of contracts being torn up 'more and more frequently', estimating 100s of would have been rescinded, though he was optimistic falling interest rates would help to improve the situation for the sector in the year ahead.
News.com.au
07-06-2025
- Business
- News.com.au
Toowoomba home to nine of Qld's top investor hotspots
Toowoomba has been revealed as Queensland's top spot for property investment with nine of the region's suburbs making the Sunshine State's list of best regional places to invest. The new MCG Regional Movers and Investor Hotspots 2025 report analysed migration and property data to highlight regional investment opportunities amid urban exodus across Australia. Mike Mortlock, report author and MCG Quantity Surveyors managing director, said MCG's analysis indicated a clear trend – Australians were increasingly looking beyond the capital cities for property investment. 'Regional areas are not only offering better affordability but also promising rental yields and lifestyle benefits that are attracting a diverse range of buyers,' he said. The MCG analysis found the top 10 investor suburbs for each state, with shortlists created by prioritising rental yields, strong population growth and the MCG Investor Score, a composite index reflecting yield, affordability, sales and rental turnover, market liquidity and local demographic strength. The Queensland list included nine suburbs in the Toowoomba region, one in Gympie and one in Mackay. Coming in at number one was Millmerran in wider Toowoomba with a median house price of $388,500, a gross rental yield of 4.8 per cent and a MCG Investor Score of 81, which was the third highest score in the country. The report said the renal market in Millmerran remained tight, while regional industry and agriculture anchored the local economy. 'Rents have grown 7.1 per cent over the past year, and a low buy affordability (5.4 years) supports steady demand from local tenants and families,' the report said. The Clifton-Greenmount area, also in wider Toowoomba came in second with an average house price of $455,000, a gross rental yield of 5.1 per cent and a MCG Investor Score of 80. Pittsworth in the Toowoomba region was third with the median house price sitting at $615,000, gross rental yield at 4.3 per cent and the MCG Investor Score at 76. The wider Toowoomba areas of Jondaryan, Crows Nest – Rosalie, Highfields, Cambooya – Wyreema and Gowrie all made the list, along with Kilkivan in Gympie. Walkerston – Eaton in Mackay and Middle Ridge in Toowoomba tied for 10th place. Sales agent Ben Liesch, of Ray White Toowoomba said the majority of Toowoomba suburbs that made the list were on the outskirts of the city or out of town. 'These are areas are more so that entry level buying,' he said. 'There has been hot competition in those area driving prices up and there's also more people having to look out of town for rentals because of short supply.' Mr Liesch said with Toowoomba experiencing a vacancy rate below 1 per cent and a growing population, investors were keen to break into the local property market. 'We do get a lot of enquiry from out of area investors and local investors have been quite busy, too,' he said. 'We've also got a lot of buyer's agents acting on behalf of investors.' Mr Liesch said investors were particularly active in the $600,000 to $700,000 price bracket, which was considering entry level in Toowoomba. 'In an area around town (that price point) gets you a three or four-bedroom home with one to two bathrooms and a little bit older. 'In more densely populated areas, it can get you a more modern house. 'Anything below $600,000 is likely a renovator or fairly out of town.' Mr Liesch said the Toowoomba property market had been heating up since Covid with projects such as the new public hospital under construction helping to drive population growth and interest in the region. The Regional Movers and Investor Hotspots report found Queensland was a leading destination for internal migration and a welcoming environment for property investors, underpinned by population growth, ongoing infrastructure commitments and steady rental demand. 'The state's generally pro-investor policy environment, alongside fewer regulatory changes than seen in Victoria or New South Wales, continues to support positive investor sentiment, particularly in the southeast and along the coast,' Mr Mortlock said. 'However, the post-pandemic surge in house prices has softened, and competition from both owner-occupiers and migrating families is intensifying in key markets.' Mr Mortlock said the December 2024 Regional Movers Index highlighted the resilience of Queensland's regional lifestyle appeal, with the top five LGAs by share of net internal migration being Sunshine Coast (35.8%), Fraser Coast (11.7%), Gympie (7.2%), Mackay (6.2%) and Toowoomba (6.0%). 'Collectively, these five regions account for more than two-thirds of the state's net migration gains, reaffirming Queensland's status as a magnet for those seeking affordability, climate and a slower pace of life,' he said. 'The Sunshine Coast remains the state's dominant growth corridor and the most popular regional destination nationally, though its share of migration is gradually receding as new hotspots emerge.' Mr Mortlock said Fraser Coast, Gympie and Toowoomba were increasingly sought after by city leavers and established Queenslanders, drawn by lifestyle, expanding job opportunities and more attainable property markets, while traditionally resources-driven Mackay was also benefiting from diversification. QUEENSLAND TOP 10 INVESTOR SUBURBS Suburb Area Median House Price Gross Rental Yield 12m Rent Growth MCG Investor Score Millmerran $388,500 4.80% 7.10% 81 Clifton - Greenmount $455,000 5.10% 4.70% 80 Pittsworth $615,000 4.30% 7.10% 76 Jondaryan $465,000 5.00% 7.10% 75 Crows Nest - Rosalie $485,000 4.30% 7.10% 73 Highfields $879,000 3.90% 10.20% 73 Cambooya - Wyreema $613,500 4.40% 10.20% 71 Kilkivan $650,000 4.00% 4.80% 70 Gowrie (Qld) $720,000 4.40% 10.20% 70 Walkerston - Eton $620,000 4.70% 14.50% 69
Daily Telegraph
26-04-2025
- Business
- Daily Telegraph
Worst NIMBY suburbs: Sydney areas choking housing supply
Chronic opposition to new housing in prime western suburbs has strangled attempts to supply Sydney with the vital homes needed to meet surging population growth. Alarming new analysis has revealed multiple, large Harbour City enclaves where fewer than 20 new homes were built over the past two years, with local housing supply growing by less than a per cent. There were 78 suburb areas identified as having 'minimal to negligible' housing growth due to low dwelling approval rates, according to the SuburbTrends and MCG Quantity Surveyors data. The low approval rates were 'indicative of local opposition or restrictive zoning practices', the research revealed. It comes as NSW continues to fall behind housing targets, with the state well short of the 377,000 homes needed to be built to meet the National Housing Accord target of 1.2 million new homes by 2029. Sydney areas with the least new housing approvals tended to be established suburbs dominated by low density, single-level homes. Less than a third of the homes in these suburbs were units or townhouses when the last census was taken in 2021. These suburbs often had space to grow and much of the community opposition to the new homes has been on density grounds. Council areas where lower volumes of housing were being approved covered much of the north shore and the inner west, along with parts of the Hills District. But individual suburbs flagged as some of the worst perpetrators of NIMBYism (Not In My Back Yard) were in Sydney's outer west – where there is generally space for new housing developments. They included Glenmore Park in Sydney's outer west, along with Harrington Park, Londonderry and Bligh Park. Other pockets with particularly low housing approvals were Menai, Illawong and Alfords Point in the Sutherland Shire and Cromer, on the northern beaches. The research excluded suburbs with less than 1500 dwellings. Low development in these areas was 'placing significant pressure on existing housing stock and exacerbating local affordability issues', the SuburbTrends and MCG research revealed. MCG Quantity Surveyors director Mike Mortlock said low approvals in many areas painted a 'clear picture of entrenched resistance to new housing'. 'Places like Glenmore Park, Illawong and Cromer are emblematic of the challenge: low-density communities, often with strong local identities, where planning inertia and local opposition continue to choke supply,' Mr Mortlock said. Many of the areas with the lowest housing approvals could benefit from densification, he added. 'What's striking is that several of these areas, such as Springwood and Wentworth Falls, offer the very lifestyle benefits that would make them ideal candidates for moderate densification. Yet we see barely a trickle of approvals,' Mr Mortlock said. 'These are the suburbs where policy needs to evolve from rhetoric to implementation, because the mismatch between demand and local supply is only widening.' Regentville, Windsor and Yarramundi were also flagged as low development suburbs, although these suburbs had strict flood control or bush fire zones that limited where new housing could be built. Regional towns within SA4 areas such as Newcastle, Wollongong, and The Central Coast also reflect strong opposition or restrictive planning policies, according to the research. This has limited new housing growth in these areas despite them being critical to relieving housing pressures in metropolitan Sydney. Housing Industry Association economist Tim Reardon said a 'perfect failure' in the town planning system had allowed NIMBY tendencies to flourish in certain councils. 'Town planners get no reward for approving a development and face risks if they do approve a development,' he said. Mr Reardon added that councils were often overly concerned with how new developments would influence voter decisions at local elections, thinking approvals would turn ratepayers against them. 'The areas where there is stronger resistance to new development tend to be older suburbs. We need to strike a balance between preserving these areas and supplying new housing. 'The solution is to take development approvals out of the hands of local councils and let state governments handle it while councils focus purely on town planning.' Mr Reardon explained that a change in homeowner attitudes would also help. 'Opposition from rate payers to higher density developments is often with the view that it will devalue the existing homes and stretch amenities but new developments often deliver the opposite. 'Well-designed developments will often bring better amenities and services and make areas more desirable.' Real estate entrepreneur Peter Diamantidis built a house in Glenmore Park back in the early 2010s and said the current planning system was unrecognisable compared to when he built. 'Most of the area was built about 30 years ago and they staggered land releases over a few years but now it's really slow,' he said. 'There is a lot of land around there but it is not as easy to build. 'The problem with a lot of areas like this is that they are really poorly planned. A whole lot of promises were made about what kind of services would be built in the area but they often haven't done that. 'There are a few suburbs that are like Glenmore Park. They have to be better serviced before they can be developed further. Right now, the infrastructure is coming in last.'
News.com.au
25-04-2025
- Business
- News.com.au
Worst NIMBY suburbs: Sydney areas choking housing supply
Chronic opposition to new housing in prime western suburbs has strangled attempts to supply Sydney with the vital homes needed to meet surging population growth. Alarming new analysis has revealed multiple, large Harbour City enclaves where fewer than 20 new homes were built over the past two years, with local housing supply growing by less than a per cent. There were 78 suburb areas identified as having 'minimal to negligible' housing growth due to low dwelling approval rates, according to the SuburbTrends and MCG Quantity Surveyors data. The low approval rates were 'indicative of local opposition or restrictive zoning practices', the research revealed. It comes as NSW continues to fall behind housing targets, with the state well short of the 377,000 homes needed to be built to meet the National Housing Accord target of 1.2 million new homes by 2029. Sydney areas with the least new housing approvals tended to be established suburbs dominated by low density, single-level homes. Less than a third of the homes in these suburbs were units or townhouses when the last census was taken in 2021. These suburbs often had space to grow and much of the community opposition to the new homes has been on density grounds. Council areas where lower volumes of housing were being approved covered much of the north shore and the inner west, along with parts of the Hills District. But individual suburbs flagged as some of the worst perpetrators of NIMBYism (Not In My Back Yard) were in Sydney's outer west – where there is generally space for new housing developments. They included Glenmore Park in Sydney's outer west, along with Harrington Park, Londonderry and Bligh Park. Other pockets with particularly low housing approvals were Menai, Illawong and Alfords Point in the Sutherland Shire and Cromer, on the northern beaches. The research excluded suburbs with less than 1500 dwellings. Low development in these areas was 'placing significant pressure on existing housing stock and exacerbating local affordability issues', the SuburbTrends and MCG research revealed. MCG Quantity Surveyors director Mike Mortlock said low approvals in many areas painted a 'clear picture of entrenched resistance to new housing'. 'Places like Glenmore Park, Illawong and Cromer are emblematic of the challenge: low-density communities, often with strong local identities, where planning inertia and local opposition continue to choke supply,' Mr Mortlock said. Many of the areas with the lowest housing approvals could benefit from densification, he added. 'What's striking is that several of these areas, such as Springwood and Wentworth Falls, offer the very lifestyle benefits that would make them ideal candidates for moderate densification. Yet we see barely a trickle of approvals,' Mr Mortlock said. 'These are the suburbs where policy needs to evolve from rhetoric to implementation, because the mismatch between demand and local supply is only widening.' Regentville, Windsor and Yarramundi were also flagged as low development suburbs, although these suburbs had strict flood control or bush fire zones that limited where new housing could be built. Regional towns within SA4 areas such as Newcastle, Wollongong, and The Central Coast also reflect strong opposition or restrictive planning policies, according to the research. This has limited new housing growth in these areas despite them being critical to relieving housing pressures in metropolitan Sydney. Housing Industry Association economist Tim Reardon said a 'perfect failure' in the town planning system had allowed NIMBY tendencies to flourish in certain councils. 'Town planners get no reward for approving a development and face risks if they do approve a development,' he said. Mr Reardon added that councils were often overly concerned with how new developments would influence voter decisions at local elections, thinking approvals would turn ratepayers against them. 'The areas where there is stronger resistance to new development tend to be older suburbs. We need to strike a balance between preserving these areas and supplying new housing. 'The solution is to take development approvals out of the hands of local councils and let state governments handle it while councils focus purely on town planning.' Mr Reardon explained that a change in homeowner attitudes would also help. 'Opposition from rate payers to higher density developments is often with the view that it will devalue the existing homes and stretch amenities but new developments often deliver the opposite. 'Well-designed developments will often bring better amenities and services and make areas more desirable.' Real estate entrepreneur Peter Diamantidis built a house in Glenmore Park back in the early 2010s and said the current planning system was unrecognisable compared to when he built. 'Most of the area was built about 30 years ago and they staggered land releases over a few years but now it's really slow,' he said. 'There is a lot of land around there but it is not as easy to build. 'The problem with a lot of areas like this is that they are really poorly planned. A whole lot of promises were made about what kind of services would be built in the area but they often haven't done that. 'There are a few suburbs that are like Glenmore Park. They have to be better serviced before they can be developed further. Right now, the infrastructure is coming in last.'
News.com.au
25-04-2025
- Business
- News.com.au
Melbourne suburbs hailed as ‘NIMBY paradise' revealed
Melbourne's outer east has been revealed as a NIMBY's paradise, with a handful of areas recording fewer than 20 new home approvals in the past two years. From The Basin and Montrose to Rowville and Frankston, there has been a less than 1 per cent increase in the supply of new homes since 2023. A report by MCG Quantity Surveyors has dubbed the locations as among the city's 'Not In My Back Yard' (NIMBY) hot spots, and those potentially needing urgent intervention to ensure more homes get built there. However, industry experts have warned there could be deeper issues with building costs, insurance availability and other market forces that could mean they are never developed. MCG managing director Mike Mortlock said areas with restrictive zoning, strong heritage overlays, or vocal local councils can often serve as a 'NIMBY's paradise'. 'These are the suburbs where new development is tightly controlled, and the existing character of the area is fiercely protected,' Mr Mortlock said. 'If you're someone who values predictability in your streetscape and doesn't want a mid-rise apartment block popping up next door, these locations offer a kind of residential preservation.' However, he said these home protections could also lead to housing undersupply — meaning stability for existing residents could arguably come at 'the cost of broader housing affordability'. 'The reality is we're grappling with a tangled web of issues — sluggish planning systems, tax burdens that inflate the cost of new housing, and a reluctance to acknowledge that a healthy rental market, supported by balanced policies for landlords, is a critical part of the solution,' Mr Mortlock said. Urban Development Institute of Australia Victorian chief executive Linda Allison said topography and building costs could be preventing development in many of the areas, with steep inclines in the Dandenong's difficult to build on. With developing in Melbourne at the moment already 'very difficult' due to the economics behind building, Ms Allison said 'market forces' were likely having a significant impact on where developers were actively looking to create more homes. 'It's good to have clear directions of where the government thinks the future of development should be, and they are very centred on train stations — which are good places for people to live and work close by,' Ms Allison said. Yes In My Back Yard (YIMBY) lead organiser Jonathan O'Brien said in some of the areas that fire danger could also be a factor. If that was the case, there might be an argument more homes should not be permitted there as it could lead to extra government costs for evacuations and protecting homes in emergencies. However, Mr O'Brien said across wider Melbourne more areas should be freed up for development so homebuyers could 'vote with their feet' on where they wanted to live. 'The reality is there's two forms of NIMBY: the older, richer people who are turning up to council meetings and saying no; and the planning rules and regulations,' Mr O'Brien said. 'We have a lot of areas where people would like to build townhouses so they can age in place, but they legally can't do it.' Mr Mortlock said those hoping to 'avoid the symphony of jackhammers and the parade of tradies' utes' should seek out low-density zoning such as residential overlays, or regions covered by heritage protections and conservation areas that were 'red flags' for development. 'So if you're hunting for serenity, look for suburbs with restrictive planning overlays, a vocal resident base, and a local council that's more clipboard than bulldozer,' he said. In The Basin, LOCI Real Estate director Michael Hill said there were pockets where council rules would be hampering development in favour of preserving neighbourhood character — and that appealed to many buyers. 'We are getting quite a few people moving from Hawthorn and Camberwell to The Basin for a tree change,' Mr Hill said. 'So there would be a market for more homes.' VICTORIA'S NIMBY PARADISES Area: Approvals (2 years) — Percentage of wider area approvals — Typical House Price The Basin: 6 — 0.40% — $840,000 Montrose: 10 — 0.40% — $930,000 Mr Dandenong-Olinda: 16 — 0.50% — $1.03m Rowville-South: 16 — 0.50% — $1.01m Upwey-Tecoma: 170.50%$848,000 Belgrave-Selby: 17 — 0.50% — $870,000 Wandin-Seville: 15 — 0.60% — $900,000 Rowville-North: 18 — 0.70% — $1m Frankston North: 53 — 0.70% — $630,000 Wendouree-Miners Rest: 45 — 0.70% — $465,000 Source: MCG Quantity Surveyors
