Autumn The Time To Plant

Autumn: The Time To Plant

Autumn is often considered the most important season for enthusiastic gardeners.

The cooling weather is the ideal time to plant. Your plant’s roots grow deep giving stability and health and setting them up for a wonderful spring.

Your local gardening centre can offer advice on what plants are suitable for your area for planting in Autumn

Should floods force a rethink

Should floods force a rethink?

There are times that cause you to take a reality check on Australia’s overriding view of bricks and mortar as investments.

As brown swirling flood waters force thousands of people from their homes in NSW and northern Victoria last week, the images of rivers breaking their banks and gushing through gardens and into homes are enough to make you cry.

When one devastated homeowner declared on national television that he “wasn’t going through this again”, his pain was raw for all to see.

Imagine being forced to grab a few precious belongings and leave your home to the will of nature.

Yes, it’s only brick and mortar, and not lives, but for many people – if not almost everyone – a home is part of what defines you. It’s full of memories. And most poignantly, brimming with dreams of times ahead.

A spokeswoman for the Bureau of Meteorology says the recent high rainfall is a result of La Niña and is not necessarily related to longer-term climate change.

Nevertheless, given that this week’s widespread flooding follows last year’s wave of floods, cyclones and bushfires, the question facing many Australians is whether this is situation normal, and if so, do we need to adapt our style of housing, or the infrastructure around it?

In a speech given by Insurance Australia Group chief executive Mike Wilkins late last year, he called on governments to learn the lessons from our recent experience to make our communities safer.

“If we don’t take action, we’re doomed to repeat this cycle of destruction, devastation, slow rebuild and lost productivity over and over again into the future,” Wilkins told the American Chamber of Commerce in December.

“In recent times we’ve seen significant new areas of land being opened up for development in the rapidly growing areas around the north west of Sydney. Much of this region is located on the Nepean floodplain and has historically been subject to severe flooding.

Should floods force a rethink

“We believe the planning authorities responsible for releasing these areas of land must ensure mitigation work is conducted prior to any new building, so it is not subject to flood if the outskirts of Sydney experience a wet summer similar to Queensland’s.”

Wilkins also highlighted the tragic Queensland floods of last summer.

“[They] were not the first times that many of the areas around Brisbane, Ipswich, Toowoomba and Emerald had been severely flooded. It will also not be the last time. In these areas, it is not a question of if; it’s a question of when the next flood will come.

“Notwithstanding this inevitable pattern, plenty of development – homes, sheds, businesses, even infrastructure like substations – was allowed to spring up in areas of unacceptable risk around Brisbane and Ipswich over the intervening drier years.”

Wilkins said it was irresponsible to rebuild in a way that “ignores clear historical records”. “We do a great disservice and potential harm to our community if we grow apathetic in our approach to rebuilding,” he said.

Wilkins put forward a number of solutions, which are listed verbatim below:

  • Increasing the woefully inadequate level of investment in mitigation infrastructure. Protective works could include barrages for unusual tides, levee banks, sea walls, properly maintained fire breaks and access trails, improved drainage and dams.
  • Planning authorities must be a lot tougher and more transparent about their planning and zoning decisions. Development simply shouldn’t be allowed in areas of unacceptable danger.
  • Strengthened building standards will ensure we are adequately prepared for changing risks.

“The improvement to building codes in cyclone-prone areas in north Queensland following Tropical Cyclone Larry meant that – notwithstanding its enormous size and destructive wind speeds – the level of damage incurred during Tropical Cyclone Yasi … was surprisingly low,” Wilkins argued.

Story source:

Tax Tip

Tax Tip

With the ATO increasing their audit activity all the time it is important to keep your tax receipts. The ATO motto is NO RECEIPT = NO DEDUCTION so you could be costing yourself thousands of dollars by not keeping them.

Under the Australian system of self-assessment it is the individual’s obligation to have the correct documentation in relation to all claims.

Keep receipts and all relevant documentation. Be thorough.

There is still profit in property

There is still profit in property

There’s still money to be made out of property if you are careful and hard-headed.

It has been the wealth strategy of a generation. Buy a home. Look after it, improve it, upgrade it. And if cash flow allows, gear up to your eyeballs to buy more property for other people to live in. For the baby boomers and for many from generations X and Y, it has been an easy path to success.

But the prospect of lower rates of capital growth and possibly even falls, if the doomsayers are right and the global economy takes another big turn for the worse, has changed the outlook for property investment.

Home owners and investors will need to be smarter about property. Solid rental yields, buying the right property at the right price and less dependence on gearing will be the key to making money. The days of certain returns made by gearing up and hitching a ride on the market boom are gone. At least for now.


In November, The Economist magazine said Australian housing prices were still 38 per cent overvalued when compared with incomes and a hefty 53 per cent when compared with rents. Household debt levels in Australia exceeded those in the US at the peak of the boom, which makes us highly vulnerable to falling prices if the worst case of a second crisis – worse than that of 2008-09 – happens.

In December, ratings agency Moody’s said Australian house prices were unsustainable and last month a leading US real estate analyst, Jordan Wirsz, predicted Australian house prices could fall by as much as 60 per cent.

Last week, the Demographia International Housing Affordability Survey found Australia was one of the least affordable countries in which to buy a home. The median house price in capital cities was 6.7 times the median annual household income – with only Hong Kong being more expensive. Sydney was the least affordable city in Australia, with a median house price 9.2 times the average annual household income.

Many commentators say prices might be fully valued, or overvalued, but a crash is not the only way the market can correct itself. The head of property and financial system research at ANZ, Paul Braddick, says talk of a big crash assumes a doomsday scenario for the economy. While not impossible, he says it’s unlikely.

”Our base case is that the labour market will remain soft for the next six months but will start to pick up again in 2012-13,” he says. ”It won’t be a boom in any sense but [the economy] should bottom and start to pick up again.

”But there are risks and that does overlay sentiment. There’s a fear of the unknown and if Europe does implode, how will that affect us? As we saw in 2008 at the height of the global financial crisis, if overseas conditions get worrying enough, the Reserve Bank will react. In 2008-09, it lowered interest rates and boosted the housing market, though that was also helped by the new first-home owner boost and changes to the foreign investment rules, which are less likely to reappear this time.”

Given that, Braddick says the most likely scenario is that house prices will fall further in the next six to 12 months but once they have found a floor, prices should start to rise in line with household incomes. He says that means longer-term growth of about 4 per cent to 5 per cent a year on average, though there will be cycles around that.

The chief economist at AMP Capital Investors, Dr Shane Oliver, says historically, prices get ”stuck in a range” for five to 10 years after they have been pushed to extremes. He says research on house prices since 1920 shows they have risen about 3 per cent a year after inflation in the longer term.

He says in the 1990s, prices were below that long-term trend (see graph below) but they took off in the early 2000s and are now about 25 per cent above the trend line. Though not predicting a US-style collapse, Oliver says it is hard to see prices growing at the rate they were because affordability is so poor and people are more reluctant to take on debt.

Australian Property Monitors (APM) is predicting national growth this year of 3 per cent to 5 per cent (see table above).

It says Brisbane, Perth and Darwin have the potential for higher growth while Melbourne, Adelaide and Hobart are likely to underperform.


The managing director of SQM Research, Louis Christopher, says buyers need to ask what would trigger a major selloff in housing and assess the likelihood of those events happening. One strong trigger (thanks to high levels of household debt) would be a return of rising interest rates. ”All it took was the cash rate to get to 4.75 per cent to cause problems in this country,” he says.

He says buyers also need to watch for signs of the banks reducing loan-to-valuation ratios. He says house prices in most big British cities fell by about 20 per cent when British lenders suddenly cut lending ratios from 100 per cent or more to 80 per cent.

”Think about it,” he says. ”If you had a $50,000 deposit and someone was willing to lend 95 per cent, you could borrow up to $950,000. But if they would only lend 80 per cent, you could borrow $200,000 and your maximum purchasing power would be cut from $1 million to $250,000. You can see the havoc that would cause in the market.”

Why would banks cut their loan ratios? Like most things, it comes back to Europe. At worst, if Europe unravelled, we would be likely to see significant bank defaults that would limit the ability of other banks to raise finance outside their own countries. Australian banks have already raised the threat of another credit squeeze.

Other risks include unemployment rising to levels in which forced sales become a problem (Christopher says SQM Research’s modelling suggests problems would occur if unemployment broke through 7 per cent) and banks lifting interest rates independently of the Reserve Bank’s changes.

Oliver says the most vulnerable are heavily geared buyers, because they are most exposed to negative equity and forced sales. RP Data recently found slightly less than 5 per cent of Australian houses were worth less than their purchase price. Queensland had the highest levels of negative equity while Victorian households had the strongest equity positions. In Melbourne, 1.9 per cent of houses were worth less than their purchase price. However, the figures did not take into account debt, especially mortgage redraws.

The research director at RP Data, Tim Lawless, says coastal lifestyle markets are also vulnerable to a downturn and have already suffered from a downturn in tourism and sea-change migrants, as well as weak demand from second-home buyers. He says many of these lifestyle markets experienced dramatic appreciation before the GFC.

He says markets that had a big run-up in prices during the most recent growth periods are now also potentially more exposed to weaker conditions. ”The Melbourne market, for example, has seen home values appreciate by almost 50 per cent since the start of 2007,” he says. ”Rental yields in Melbourne are now the lowest of any capital city and new housing supply has been much more sufficient than [in] other cities.”


In this market, most analysts say the old strategies no longer guarantee success.

Buyers will need to do their sums and ensure they are buying well rather than simply picking the next ”hot suburbs” and riding the boom.

Success will also depend on having the flexibility to decide when to sell. That means buyers will need to keep borrowings at a manageable level so they are not forced to sell at the worst possible time.

There is still profit in property

Christopher says he is loath to tip particular areas, given that any recovery might not be long-lived. But he does favour the outer ring of Sydney, particularly the western and south-western suburbs.

”We see a big movement to more affordable housing,” he says. ”Rents there have already been rising by about 5 per cent a year, infrastructure has been improving and they have the potential to outperform over the next five years. We think 7 per cent growth there is possible.

”More average and above-average income earners are moving west because they don’t want to raise a family in a unit and it makes the mortgage more manageable.”

APM forecasts growth in Sydney this year will come mostly from middle- and lower-band suburbs, supported by high rents and an undersupply of housing. In his 2012 outlook, the senior research analyst at RP Data, Cameron Kusher, also predicted Sydney might perform better than in 2011. ”Home values across Sydney have increased at an average annual rate of just 4 per cent over the past 10 years,” he says. ”Although value growth has been limited, rents have increased by 5.4 per cent for houses and by 6.4 per cent for units in 2011. Estimated sales activity as at September 2011 was 6 per cent above the five-year average. Sydney’s market continues to be hampered by an undersupply of new housing at a time when demand remains strong.

”Although we don’t expect property values to increase at a rate above inflation, we anticipate Sydney will continue to be one of the better-performed markets, especially considering that when adjusted for inflation, values remain below their 2004 peaks.”

A property adviser at Lachlan Partners, Ana Bennett, says areas along the main Sydney transport corridors ”should do well”, given the undersupply of housing – ”areas that aren’t reliant on having two cars to get to work” – though she says Melbourne is a different prospect.

”The large volume of stock coming onto the market in Melbourne is a concern,” she says.

For investment, she favours ”the groovy, funky areas with a younger demographic”, such as South Yarra, Richmond and Middle Park.

”The other opportunity is the old house on the corner block in suburbs like Cheltenham where there is the potential for multi-residences down the track,” she says. ”Investors can rent them out for five years or so with a view to either selling the site or developing themselves. People are saying they’ll build one residence for themselves and sell the second for profit.”

Braddick says buyers should be aware that states are likely to perform differently. ”NSW has the advantage of being the most undersupplied market but it’s tricky to look at particular sectors.” He says if the construction and resources sectors continue to boom, this could support the upper end of the market, while soft conditions in retail and manufacturing could dampen the middle and lower parts of the market.

”But ultimately it will come back to the ‘atmospherics’ – the number of properties on the market, current sentiment and so on,” he says. ”Over the short term there could be significant increases or falls but on average the market is unlikely to achieve much.”


To a large extent, buying a home is a lifestyle decision and you can afford to trade off slower capital growth against the desire for a place to call your own.

But if you’re considering putting your hard-earned money to work in investment property, you’ll need to be hard-headed.

Braddick says investors in the 2000s ”got away with non-focused property buying because most prices were going up.” But with capital gains likely to play less of a role, investors will need to focus on yield for more of their return.

”You need to look at the yields now and what they will be in the future,” Bennett says. ”The initial yields in the inner city may be lower but newer stock can balance that with depreciation allowances and if you get income growth, the yield will bounce back.”

Lawless says units have outperformed detached dwellings in terms of value growth in recent years.

”This is probably due to both improving demand related to price sensitivity [units are generally more affordable than houses] as well as the fact that units generally provide higher rental yields than houses. With more focus on urban renewal and higher densities around transport hubs and employment nodes, we would expect that well-located units will continue to be a popular choice for investors,” he says.

”Another tactic that is likely to remain popular among investors is buying within close proximity to the capital cities. The 10-kilometre to 15-kilometre ring should continue to provide reasonable housing demand with tight supply constraints. Public and private transport options are becoming even more important and these factors will be one of the primary drivers of long-term capital gain.”

Oliver says investors might also want to consider looking outside the residential box.

”You can argue that if you’re going to buy investment property, you’d be better off looking at commercial property where the yields are higher and there is less evidence of overvaluation,” he says. ”Listed property trusts have gone back to their roots after going through a more speculative period and are offering yields of 5.5 per cent to 6 per cent, unlisted property trusts and syndicates are an option [though you have to be careful], or you can invest directly in something like a shop, warehouse or strata office.”

The new rules to property success

When it comes to gearing, less is more. ”It’s not what you own but what you owe,” Shane Oliver, of AMP Capital Investors, says.

Think affordability. The more expensive your property, the smaller the list of potential buyers or renters.

Buy well. What’s the point of being in a weak market if you don’t get to dictate terms? ”You make money in property when you buy, not when you sell,” Ana Bennett, of Lachlan Partners, says.

Don’t count on making a quick buck. ”If you think you’re getting a bargain, you’re usually not,” Bennett says. She says property should be regarded as a long-term investment. ”Particularly for investors, you have to ask whether you can really afford it,” she says. ”There’s no point struggling and realising you have to sell in two to three years.”

If you’re investing, think income. In the absence of strong capital growth, investment returns will increasingly depend on a decent, and growing, rental yield.

Do your homework. While average returns might not look promising, the property market is highly segmented and demand for the right properties will remain strong. Look for properties that are in undersupply, not a dime a dozen. ”I would be wary of locations that have recently experienced a large surge in home values or where rental yields are lower than average,” RP Data’s Tim Lawless says. ”Areas where housing can easily become oversupplied should also be treated with some caution.”

Understand that property prices can be volatile – especially in the short term. Just because your house price isn’t quoted on the news each night doesn’t mean it can’t go up and down. ”If you put a large proportion of your money into a particular investment, it is a risky position, particularly if you’re also leveraged,” Michael Sherris, from the Australian School of Business, says. ”There may be half the volatility that you get with shares but people think there’s no volatility at all.”

Look for areas with strong population growth, strong demand and good infrastructure that is improving.

Think outside the box. Will it be possible to add value to the property in the future? If residential property doesn’t stack up, what about commercial?

Don’t expect history to repeat itself.

Story by Annette Sampson, source:

Five Water Saving Tips To Save You Money

Five Water Saving Tips To Save You Money

Making your home energy and water efficient not only assists the environment but can save you money over the long-term.

Here are five water saving tips:

  1. Install water efficient shower heads
  2. Install water efficient tapware
  3. Install sprinkler watering systems with focus on efficiency
  4. Purchase water efficient washing machine
  5. Purchase water efficient dishwasher
NSW housing pushes ahead while other markets remain soft

NSW housing pushes ahead while other markets remain soft

The preliminary capital city dwelling value index result for December was -0.2% (s.a.) following an upwardly revised +0.4% rise in dwelling values in November (was +0.1%). Revised regional house values for November increased from +0.3% to +0.5%. Sydney housing has been the nation’s best performer with dwelling values up 0.4% in December and by 0.7% over the quarter (s.a.).

In the generally seasonally weak month of December, the preliminary RP Data-Rismark Home Value Index result for capital city dwelling values was -0.2 per cent (s.a.). Low sales volumes in December mean that this number will likely see a more significant revision than normal.

The November result from the RP Data-Rismark index for dwellings in capital cities has revised up from +0.1 per cent (s.a.) to +0.4 per cent (s.a.) based on additional sales information. This marks the largest month-on-month improvement in Australian home values since May 2010.

The RP Data-Rismark ‘rest-of-state’ index, which covers Australia’s regional markets, has also revised up in November from +0.3 per cent to +0.5 per cent (s.a.). This is the most significant increase in regional house values since November 2010.

Over the December quarter, Australia’s capital city home values declined by -0.5 per cent (s.a.).

RP Data’s director of research Tim Lawless, said, “The December quarter was the year’s smallest quarterly decline. According to our index, capital city home values fell by -1.5 per cent (s.a.) in the March quarter, and by a further -0.8 per cent (s.a.) in each of the June and September quarters. This rate of decline had decelerated to -0.5% by the final quarter of 2011.”

NSW housing pushes ahead while other markets remain soft

In 2011, Australian capital city dwelling values experienced a capital loss of about three and a half per cent. Regional house values fared a little better, correcting by around three per cent. This compared to the 14-15 per cent decline in Australian shares. Adding in rents, the gross total return to Australian property investors was slightly less than one per cent over 2011.

Rismark’s managing director Ben Skilbeck said, “The month of December is characterised by a significant lull in activity and the preliminary index results have likely been influenced by some more volatile Melbourne and Perth estimates. We expect to get better clarity on the monthly movements as more information is reported.”

“Sydney currently has the largest volume of reported sales in December. In seasonally-adjusted terms, Sydney dwelling values rose by 0.4 per cent in the month of December. In the December quarter, Sydney dwelling values are up a total of 0.7 per cent (s.a.)” Mr Skilbeck said.

RP Data’s Tim Lawless observed that rental markets continued to strengthen in December.

“Weekly rents across the capital cities were up 1.0 per cent over the December quarter and are now 6.3 per cent higher than at the same time last year.”

“These higher rental rates combined with the slide in property values have improved investors’ yields. The average capital city dwelling is now offering a gross rental return of 4.6 per cent after a consistent trend upwards since mid-2010 when the typical capital city dwelling was yielding just 4.1 per cent. Darwin and Canberra are the highest yielding locations for property investors while Hobart, Brisbane, and Sydney provide gross yields that are better than average,” Mr Lawless said.

On the outlook for the year ahead, Rismark’s Ben Skilbeck commented, “We expect that the RBA’s interest rate cuts in the final two months of 2011 will lend further momentum to housing activity as transaction volumes pick up over February and March after the seasonally slow months of December and January. If financial market pricing for substantial additional RBA rate cuts proves accurate, we could see a stronger-than-expected bounce-back in housing conditions.”

“Housing affordability in Australia has experienced a striking improvement in recent times. While disposable household incomes on a per household basis rose by five per cent over the year to September 2011, Australian dwelling values have declined by 3.4 per cent since September 2010. As a result of the RBA’s rate cuts borrowers can now get fixed- and variable-rate home loans as low as 5.9 per cent and 6.14 per cent. Rismark’s research shows that disposable incomes per household have risen about 15 per cent further than Australian dwelling values since the end of 2003. This helps account for the decline in Rismark’s national dwelling price-to-income ratio, which is as low as its been since 2003” Mr Skilbeck said.

RP Data’s Tim Lawless added, “While global uncertainty and a stagnant local labour market could weigh on the consumer’s mindset, we are nevertheless observing improvements in monthly housing finance commitments. RP Data’s leading indicators on average selling times and vendor discounts are also starting to look healthier. There is no doubt that additional interest rate relief in 2012 would afford a very welcome cushion to the housing market.”

A Garden Focal Point

A Garden Focal Point

Great gardens add value to your property.

A good idea when designing your garden is to add a focal point or feature. This can be a water feature, shaded sitting area, artwork or artefact.

These days there are many options available over the internet, in garden centres and even salvaging something unique from the tip.

Contemporary sculptures, large pots, collections of pots, screens and the use of metal are some ideas.

Australia's still raising the real estate roof

Australia’s still raising the real estate roof

AUSTRALIAN housing markets displayed a generally resilient performance in 2011, reflecting the inherent security of residential real estate in this country, particularly when compared with housing markets in similar open-market economies.

The year was always set to be a period of correction for Australia’s housing markets following the unsustainable growth in house prices recorded through 2009 and 2010.

Between January 2009 and June 2010, Melbourne’s quarterly median house price rose by nearly 30 per cent, with Sydney’s up by almost 20 per cent over the same period. All other capitals also recorded big rises in house prices over those 18 months.

Housing affordability crashed by the end of 2010, with surging house prices and rising interest rates combining to send buyers into hibernation.

Australian Property Monitors data has revealed that capital city housing markets have generally performed encouragingly in 2011 despite the pressure on housing affordability generated in 2010 and a mixed economic performance in 2011.

The national median price for houses over the year to October 2011 fell by just 1 per cent compared with the previous year, with median unit prices rising by 1.2 per cent over the year. The 2011 result follows a 17 per cent rise in the national median house price over the year to October 2010 and a 12.2 per cent rise in the median unit price over the same period.

The best capital city performers were Melbourne and Sydney, where annual median house prices rose by 1 per cent. Darwin and Adelaide house prices were flat and Hobart down 1.5 per cent.

The worst performers over the year were Brisbane and Perth, where annual median house prices fell by 3.5 and 4.75 per cent respectively.

The unit market clearly outperformed the housing market over the year to October 2011, with Sydney recording median unit price growth of 2 per cent followed by Melbourne and Darwin up by 1 per cent. Brisbane and Perth were again the underperformers, with annual unit prices falling by 1.3 per cent and 3.5 per cent respectively.

Bureau of Statistics data confirms the solid performance by Australian housing markets in 2011, with the number of owner-occupier housing loans rising by 2.4 per cent over the 10 months ending October compared with the same period in 2010.

New South Wales was the best performer with an increase of 8 per cent, with Western Australia surprisingly in second place with growth in home loans of 7 per cent over the year, courtesy of a surge in the past three months – indicating perhaps growing late-year momentum in that market.

By contrast, the number of home loans approved in Queensland in the year to October fell by 8.4 per cent compared with the same period in 2010.

The nature and strength of Australian housing markets in 2011 was always to be determined by the underlying supply and demand characteristics of individual markets and the strength of national and local economies.

In addition to the affordability barriers created by the prices surge and interest rate rises of 2009 and 2010, housing markets have had to encounter unexpected headwinds in 2011. The impact of the central Queensland and Brisbane floods was not restricted to the local housing markets. National economic output was affected through reduced coal exports and the cost of the reconstruction levy. Higher prices for fruit and vegetables also affected household budgets nationally.

Australia's still raising the real estate roof

The impact of catastrophic natural disasters on the national psyche and confidence cannot be underestimated, particularly given Australia’s recent propensity for financial conservatism, especially when it comes to buying or borrowing.

The Japanese earthquake and associated tsunami in March also contributed to lower economic growth and reduced consumer confidence.

Stalling economic growth in 2011 was also a product of continued mixed performances by various industry sectors, particularly retail, manufacturing, tourism and construction. As a consequence, all capitals recorded rises in unemployment through mid-year. All these factors combined to subdue consumer capacity and confidence and consequently dampen home buying activity through 2011.

Most Australian capital city housing markets are, however, set to record growth in median prices over 2012 as the national economy gathers strength. The Australian economy is primed to expand strongly on the back of a significant resources boom with the Organisation for Economic Cooperation and Development predicting gross domestic product will increase by 4 per cent over the year.

Melbourne, Adelaide and Hobart will be the underperformers in 2012, with median house price growth of between zero and 5 per cent.

Melbourne’s balanced housing supply and demand mix offers buyers a wide choice and it remains the most tenant-friendly capital city rental market. Affordability barriers, however, remain for home buyers.

With the Victorian economy showing signs of running out of puff, particularly as the recent construction boom abates, the housing market is set to drift sideways though 2012. The possibility remains of some growth in median house prices by the end of 2012 as the impact of a strong national economy filters through.

Dr Andrew Wilson is senior economist for Australian Property Monitors.

Source: BusinessDay

Australia ‘ahead of its time’ in global recovery

Australia ‘ahead of its time’ in global recovery

Australia’s property market is recovering with vigour thanks to the strengthening employment sector, according to CB Richard Ellis.

The company’s executive director of research for the Pacific Region, Kevin Stanley, said the employment base in Australia had already recovered from the downturn with rates of growth now returning to trend.

According to Mr Stanley, the improvement in employment confidence will help buoy rental growth across the nation’s capital cities over the next 12 months.

“The one thing that stands out is the growth phase in employment, with Australia at least a year ahead of the rest of the world,” Mr Stanley said.


Mr Stanley said CBRE had brought forward its forecasts for rental growth by 12 months, with the spike in rents now expected to occur next year as opposed to 2012. CBRE’s revised forecast is for rental growth to average 6.7 per cent from 2010 to 2012.

CBRE has also forecast capital values in the Sydney CBD to grow by an average of 10 per cent per annum between 2010 and 2012.

“The income growth promise in Australia is the big motivator and while the market will continue to be dominated in the short term by equity investors we expect to see a gradual return of bank lending, with a very cautious letting off of the screws by the banks in the next few years,” Mr Stanley said.

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