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AFRThursday 21 July 2016TheAustralian Financial Review |www.afr.com

commercialrealestate.com.au

38 Property =?

Housepricesbouncedback,saysDomain

Median dwelling price changes by city, housing type and period

HOUSES

UNITS

SydneyMelbourneBrisbaneAdelaidePerthCanberraHobartDarwinNational

SydneyMelbourneBrisbaneAdelaidePerthCanberraHobartDarwinNational

Jun2016

$1,021,968$740,995$521,915$498,927$568,132$654,306$345,880$613,590$731,188

$669,830$450,933$370,251$294,165$367,025$399,505$276,312$448,417$524,905

Mar2016

$997,925$730,044$515,704$494,481$577,934$634,559$344,894$618,109$720,668

$665,913$435,684$377,127$299,137$376,120$405,934$269,473$448,416$521,205

Jun2015

$1,010,309$690,045$500,523$477,975$601,937$624,117$337,021$664,899$712,118

$666,902$439,113$382,405$293,848$398,223$417,806$250,220$455,423$524,159

Change(% QoQ)

+2.4+1.5+1.2+0.9-1.7

+3.1+0.3-0.7

+1.5

+0.6+3.5-1.8-1.7-2.4-1.6

+2.50.0

+0.7

Changing picture

SOURCE: DOMAIN GROUP

+1.2

+0.4

+0.1

+0.1

+2.6

+2.7

+2.7-3.2

-1.5

+7.4

+10.4

+4.3+4.4

+4.8-5.6

-4.4

-7.7

-7.8

Change(% YoY)

● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ●

MichaelBleby

Lower interest rates and a resurgenceof investors pushed housing priceshigher in the June quarter, withSydney’s median house price jumpingback over the $1millionmark.The pick-up in Sydney’s median

house price came in a quarter inwhichMelbourne, Adelaide and Canberra allposted record highs, the latest DomainHouse PriceReport showed.Domain is owned by Fairfax Media,

publisher of The Australian FinancialReview.Nationally, house prices rose 1.5 per

cent from the March quarter, led byCanberra’s 3.1 per cent quarterly gainand Sydney’s 2.4 per cent increase.Apart from Brisbane, where

detached houses posted a 1.2 per centquarterly rise, there was little change

for the resource-dependent capitals.Prices fell 1.7 per cent in Perth and0.7 per cent inDarwin.While the report paints a stronger-

than-expectedpictureofdwellingpricegrowth this year – echoing theNationalAustralia Bank’s June quarterly surveylast week – conditions are still far fromtheir heady days of the past two yearswhich are unlikely to repeat, withdwelling price growth having out-stripped wages growth and the abilityofmanybuyers to accept higher prices.‘‘It’s not an inferno any more, just a

cosy little blaze,’’ Domain chief eco-nomistAndrewWilson said.‘‘Even though interest rates have

fallen, they don’t have the same fizz inthem. The pent-up demand has beensatisfiedtoa largedegree inSydneyandto a lesser extent inMelbourne.’’While Sydney’s median house price

picked up to $1,021,968 from $997,925inMarch, it remainsbelowtheSeptem-ber 2015 recordof $1,032,899.Further, while house prices were

generallyhigher, thepicturewasnot sorosy with apartments, with signs ofgreater supply starting to affect prices.Units in Melbourne posted strong

quarterly growth, but the national fig-ure was pulled down to a pedestrian

0.7 per cent by declines in Brisbane,Adelaide, Perth andCanberra.InSydney, apartmentprices rose just

0.6 per cent.‘‘Unit prices hardly moved,’’ Dr Wil-

son said. ‘‘There are signs supply iscatchingup.’’Darwin, at least, saw no change in

apartment values.Even with a further possible rate cut

on top of May’s reduction to 1.75 percent, the ability of lower rates to pushprices higher was weakening, Dr Wil-son said.‘‘We’re looking at an overall 3 per

cent to 4 per cent national growth thisyear,’’ he said.‘‘The longer-term dynamic of the

cycle is 3 per cent to 4 per cent goingforward.’’

Oceania snapsupChinatownsite● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ●

LarrySchlesinger

Three adjacent terraces on SussexStreet in Sydney’s Chinatown havebeen snappedup inone line by theLimfamily’s Oceania Property develop-ment and investment business for$21.35 million.The terraces at 321-325 Sussex Street

cover a land holding of 391 squaremetres and are expected to make wayfor a newhotel. An artist impression ofa scheme for the site shows the poten-tial for a tower of about 13 storeys.Oceania is controlled by property

developer JulinaLimwithher sonNicoTjen a co-director. Last year Ms Limsold her Wolseley Road mansion inPoint Piper for $28million.OceaniaProperty ismarketingapart-

ments in theGrosvenor,adevelopmentin Croydon in Sydney’s inner west. Ithas completed more than a dozendevelopments in Sydney, including the

Bay Residences in Double Bay andother high-endniche offerings.Italsoownsanumberofcommercial

buildings in Sydney including the LGBuilding in North Sydney, the P&OBuilding on Sussex Street and 92 PittStreet in theCBD.Last year, the group acquired a

679-square metre site on RenwickStreet, Redfern, for $5.6million.TheSussexStreet sitewasoffered for

sale by JordanLee and SteamLeung ofColliers International as a primedevelopment site for a hotel, apart-ments or studenthousingwithaheightlimit of 50metres.The three, five-level terraces were

offloaded by Ambly Holdings, whoseshareholders include members of theCheng family from China and HongKong. The site is a 50-metre walk fromTown Hall Station and DarlingHarbour and walking distance fromLendlease’s$3billion ‘‘DarlingSquare’’.The Australian Financial Review is one of the industry’s most valuable and essential

daily business intelligence partners.

The Monday to Saturday Property section in The Australian Financial Review explores who bought, who sold and who made money from the market across Australia, with coverage provided by dedicated journalists in all major capital cities.

The section carries a range of news, features, analysis and profiles focusing on the listed property trusts, developers, fund managers and private investors.

AFRGA1 A001

Colour. Clarity. Detail.CAvailable in prescription. STYLE SHOWN: KAWIKA

Trump’sbondrouta threat to sharesGlobal sharemarket rebounds follow-ing Donald Trump’s surprise US presi-dential victorymaybe short-lived.While sharemarkets initially

jumped, bond markets have sold offheavily amid expectations that aTrump presidency would pump upinfrastructure spending and stokeinflation. Now investors worry higherbond yieldsmight hit shares, too.The S&P/ASX200 index slipped 0.4

per cent onTuesday, led downbybondproxy stocks.Wilson Asset Management fund

manager Geoff Wilson predicted theAustralian sharemarketmay fall about5 per cent by late 2017 because ofheadwinds fromrisingbond yields.Justin Braitlin, chief investment

officer of hedge fund WatermarkFunds Management said Mr Trump’svictorywas apoliticalwatershed.‘‘We’re now in a bear market for

bonds, andwe think sharemarketswillfollow,"hesaid. "Therally inshareswillprobably last through Christmas, withthe typical Christmas rally, but wethink itwillprove tobeasucker’s rally."

�Lowe leans against further rate cuts

RBA, IMFwarnofdebt,housingrisk

● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ●

JacobGreberEconomics editor

Continued p6

Heavily indebted Australian house-holds and governments need to buildgreater financial resilience against aglobal economy facing freshuncertain-ties following the rise of DonaldTrump, the Reserve Bank of Australiaand InternationalMonetary Fund haveurged.In a major speech in Melbourne on

Tuesday night, Reserve Bank governorPhilipLowehinted thathewasunlikelyto grant households further officialinterest rate relief lest it generate evenmore borrowing – even if the economycould usemore consumer spending.‘‘It is unlikely to be in the public

interest, given current projections fortheeconomy, toencourageanoticeablerise in household indebtedness, even ifdoing so might encourage slightlyfaster consumptiongrowth in the shortterm,’’ DrLowe said.Days of mounting turmoil on global

bond markets have sent yields sky-rocketing, stoking a financial marketrout that threatens toultimately test theability of Australian borrowers toweather a surge in the global cost ofmoney.While Australians could ‘‘take some

comfort’’ that the country still has theability to fend off future shocks –including a flexible currency andremaining federal budget firepower,and a high household savings rate – hewarned that ‘‘strengthening these buf-fersmakessense intheuncertainworldinwhichwe live.’’The warning came just hours after

the IMF suggested that a sudden out-break of Trump-style protectionismthat may slam global trade is amongthe biggest risks facing Australia’sheavily-indebted economy in a crisis.The fund’s economists, who have

been in the country over recent weeks,challenged Canberra to do more to liftproductive infrastructure investment,saying the Reserve Bank no longer has

much interest rate ammunition tostave off any suddendownturn.Bond market investors have been

savagedover thepastweekon specula-tion a Trump presidency will deliver aboom in debt-financed infrastructureinvestment and tax cuts, ultimatelybreaking the global low disinflationaffliction that has ground advancedeconomies down since the 2008 globalfinancial crisis.Yields have spiked to their highest

levels since January around the globe,with Australia’s 10-year treasurybenchmark trading above 2.7 per centfor the first time in almost a year,though the sell-off slowedonTuesday.Bets are also moving against further

Reserve Bank interest rate cuts, withthe probability of another reduction inthe cash rate over the next 10 monthsnarrowingonTuesday tonomore than12 per cent compared to asmuch as 28per cent on Monday. In the US, thejump in bond yields has sparked a

www.afr.com | Wednesday 16 November 2016 $4 INCLUDES GST

FINANCIAL REVIEW

High rentHolidayhomesthat pay offMagazine Inside today

Astepcloser | Aurecon senior director LouiseAdams says gender equalityprograms are having an impact as newdata show42.6 per cent ofmanagementappointments in the last yearwere forwomen. Report p3, Accounting p35 PHOTO: PAT SCALA

Quadrant’s $300mtourismexperienceExclusive | Private equity firm Quad-rant has spent $300 million in just afew months amassing a portfolio of‘‘experiential’’ tourism businesseswhich it says will replace the miningboom. After buying Great Southern,owner of the Ghan and Indian Pacificrailways , ithas formedanewcompanycalled Experience Australia Groupwhich will also run stakes in CruiseWhitsundays, the biggest tourism andferry company in North Queenslandand Rottnest Express, a big tour oper-ator inWA.� Companies p15

AMPchair turnsuppressureonCEOExclusive | AMP chairman CatherineBrenner has turned up the pressure onCEO Craig Meller after prickly meet-ings withmajor shareholders. Brenneradmitted to Chanticleer that one share-holder had called on theboard to replace Melleras CEO but she said hehad the full backing ofthe board. “The boardbacks Craig,” she said.� Back page

� Markets Miners push shares lower p26� BHP tipped to boost dividends p13

MASTEROFDARKARTSTrump’sNewAmerica |Alt-right strategist enters theWhiteHouseFeatures p36, Opinion Gideon Rachman, Robert Samuelson, Gary Bowditch, Brian Toohey p23, 38, 39

� Jennifer Hewett China not Trump p2� IMF warns on protectionism p6� Crackdown on investors: IMF p6� PM wanted 457 remake, too p5

Trumpeffect hits lendersFirstmac, the nation’sbiggest non-bank lender,and nine other smallerlenders are discreetlyraising fixed-ratemortgages by up to 45basis points in a move

expected to be followed by others as the"Trump effect" begins to bite localborrowers, according to lenders andmarket analysts.

Firstmac has increased one to three-yearrates on its owner-occupier and investorrates by up to 13 basis points. Owner-occupied rates have increased to 4.09 percent and investor rates to 4.34 per cent.Martin North, of consultancy DigitalFinance Analytics, said ‘‘other lenders arelikely to follow’’. Report p29

● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ●

Political turningpoint

Some say the bondsell-off reflects fearsother ‘barbarians’could soonhold thelevers of power.

Karen Maley p26● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ●

Asbond yields rise,dividend stockslook expensive. Thewhole process justunwinds.

Philip Baker p28● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ●

Higher bond yieldsat a timeof recordglobal governmentdebt? Enjoy the ridewhile it lasts.

Jonathan Pain p25● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ●

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