Today the Reserve Bank of Australia (RBA) has increased the official cash rate by 0.25%pa.

The official cash rate remains at 4.00% p.a.
(this is the wholesale rate before bank margins)

For an article published by The Age this afternoon please click here

In an internet report by domain.com.au, the median price of apartments in the last 12 months to October 2009 is $432,000 and a long tend trend of 6.7% growth per annum.

Ranked one of the most liveable suburbs in Victoria, South Yarra has outperformed many other suburbs within the 4km radius as the ‘preferred suburb’ to live in for professionals in Melbourne. In a report published on the 20th August 2005 to rank suburbs in Melbourne, fourteen indicators, from crime to entertainment, were used to rank each area, writes Martin Boulton.

According to Melbourne 2030 — the State Government’s strategy for accommodating an extra million people in Melbourne in the next 25 years — sustainable housing, shops and access to services will shape the future of our suburbs.

But while affordable housing is the key factor in where people live, other factors including crime, access to schools, restaurants and entertainment help explain why people move to, or away from, a particular suburb.

The authors of the Liveable Melbourne report, commissioned by The Age, looked at the characteristics that help define our suburbs and developed 14 indicators to try to quantify what constitutes liveability.

“As you move around Melbourne, the ability of the place to provide all things that are important to people — shops, schools, parks — varies considerably,” said co-author Dr Daniel Terrill.

So how did each suburb perform across transport, proximity to the CBD and the coast, culture, traffic congestion, education, shopping, open space, tree cover, cafes and restaurants, topography and crime?

Raw data in the form of Australian Bureau of Statistics findings, crime figures, bus routes, etc was collected for the appropriate indicator and then collated to give each suburb a ranking from one to 314, with one being the highest ranking for each indicator. If a suburb had no crime at all, for example, it was judged the best performing suburb on the crime indicator, making it number one on the list of all 314 suburbs for that indicator.

Once each suburb had a ranking for each indicator, the ranking was converted into a score between zero (lowest) and five (highest) to produce a total indicator score. South Yarra, for example, scored a five on seven of the indicators, for a  total indicator score of 53.

The lower ranking suburbs were mostly on Melbourne’s outer-suburban fringe and scored poorly on most of the indicators, particularly access to public transport.

These included, in no particular order, Hallam, Sydenham, Lysterfield, Kilsyth South, Cranbourne North and Bayswater North. A condition of the survey was that suburbs outside the top 150 would not be ranked.

Terrill said it was “implicit in the scoring methodology” that each indicator had equal weighting in the total score.

“Liveability is a subjective term … but having decided upon the indicators the rest of the process has been highly objective,” he said.

Iain Butterworth, a senior lecturer in the School of Health and Social Development at Deakin University, welcomed the findings but said a liveability survey should ideally include an analysis of the social values built into those environments.

“Going ahead we need to build liveability into our suburbs,” he said.

“South Yarra is No.1 because it happens to be close to the city, is close to trams, trains, entertainment (and) wealthy people can afford to live there, but is it a healthy suburb?

“Just because Rosanna came in at 150 doesn’t mean it’s a less healthy place, or the people there care less about each other than a suburb ranked somewhere near the top.”

If you have not been to the ‘coolest’ part of Melbourne, then it may be time for you to explore the shopping and entertainment precinct of South Yarra. The most prominent street is none other than Chapel Street. A list of interesting sites and buildings are found along this 4.13km trendy strip.

From the Yarra River heading south:

* The Como Centre is a multi-storey office, retail cinema and hotel complex on the north-east corner of Chapel Street and Toorak Road. It is the headquarters of ATV-10 Television. Vogue, a mixed-use development is currently under construction. The residential part of the development will be released in due time. Watch this space for it!

* The Jam Factory is an iconic shopping, cinema and entertainment complex on the corner of Garden Street. More information can be found on http://www.thejamfactory.com.au/

* Just off Elizabeth Street is the Prahran Market, a fresh food market which has occupied its present site for over 120 years.

* The Chapel off Chapel theatre and gallery venue is at the end of Carlton Street.

* Pran Central at the corner of Commercial Road is a redevelopment of a National Trust classified building into a residential and commercial complex with a multicultural food court.

* Greville Street is a small niche shopping strip.

* Prahran Town Hall, on the corner of Greville Street was opened in 1861. The original hall was built in 1861 to the design of local architects Crouch & Wilson in the popular Italianate style of Melbourne at the time, including renaissance inspired interior
spaces. The hall was extended some years later to include a City Hall (1888) in a complementing style. In 1994, after the amalgamation of the City of Prahran with the City of Malvern to form the City of Stonnington, the town hall now functions as the secondary offices for the city council.

* The Prahran campus of Swinburne University is near the south west corner of High Street. There has been quite a number of developments with studios targeting at residences for students in this area.

* The first bowling club in Australia, the Melbourne Bowling Club, is situated behind Chapel Street in Union Street. The club was founded on 11 March 1864.

* The Astor Theatre on the south west corner of Dandenong Road is a Heritage Victoria registered, 1930’s art deco cinema which seats over 1100 people.

* St Michael’s Grammar School now incorporates many of the area’s old buildings.

Download the map from this site. For more information on our upcoming release, VOGUE, please contact me via email.

Vogue South Yarra apartments are positioned at the heart of Chapel Street, Melbourne’s
most stylish shopping, dining and entertainment precinct. VOGUE, a mixed-use development made up of both splendid shopping and residential apartments above it is set to be one of the most iconic tower in the prestigious suburb of South Yarra.

South Yarra needs no introduction. Chapel street is analogus to Orchard rd of Singapore with desirable lifestyle options. It’s a place where most of the young, high-income earners yearn to live in.

From an investment perspective, gross rental yield should be slightly higher than 5% for selected units(with carpark) and according to homepriceguide, the median price of units has grown by 7% between March 2009 and September 2009 and currently the median price of units in the suburb is $442,000.

Property managers have reported that units take roughly 3-6 days to be tenanted the moment an application is received from a prospective tenant, hence the vacancy period of units in this are is reduced dramatically.

Full specifications and cashflow analysis can be produced upon request. We don’t think the entire development suits investors but at least of handful of the units would do well from an investment perspective. Just drop me an email and we will take it off from there.

Have a awesome week ahead!

Australia’s central bank unexpectedly raised its benchmark interest rate from a 49-year low by a quarter percentage point amid signs the nation’s economy is strengthening. Reserve Bank Governor Glenn Stevens increased the overnight cash rate target to 3.25 percent from 3 percent in Sydney yesterday.

Only one of 20 economists surveyed by Bloomberg News forecast today’s decision. The rest predicted no change. Australia is the first Group of 20 nation to raise borrowing costs since the start of the global financial crisis more than a year ago. Rising job vacancies, retail sales and house prices, plus surging business and consumer confidence support Stevens’ view the economy is accelerating enough to scrap the bank’s “emergency” rate setting.

“It makes sense for the Reserve Bank to start the tightening cycle at the earliest opportunity,” Stephen Walters, chief economist at JPMorgan Chase & Co. in Sydney, said ahead of today’s increase, which he forecast. There has recently been “a near uninterrupted stream of healthy economic data.”

Governor Stevens, who cut the benchmark lending rate by a record 4.25 percentage points between September 2008 and April to cushion the economy against fallout from the global credit squeeze, said on Sept. 28 that compared with past recessions, “this has been a good episode for Australia.”

“In due course, both fiscal and monetary support will need to be unwound as private demand increases,” Stevens told a Senate committee in Sydney.

Whilst there’s no prefect investment property in any location in this world, I found an interesting development lately which I thought was reasonably ideal for investors looking to build or grow their property portfolio. ‘Ruby’ apartments consists of 116 residential apartments over six levels with a combination of 1 and 2-bedders in the development. Located in Richmond, a suburb 3km to the east of Melbourne CBD, this development presents an opportunity for investors to add something unique to their portfolio.

Home to the MCG and the Rod Laver Arena(venue for the annual Australian Open), Richmond is the sporting hub for Melbourne. Best known for its bargain designer and seconds shopping along Bridge Road and Swan Street, vibrant Richmond is also the place to go for Greek or Vietnamese food, languid all-day breakfasts and great live music.

Richmond is one of the Melbourne’s earliest settlements and these days is where many of Australia’s finest fashion designers have their factory outlets and seconds stores – pick up bargains at Mimco, Country Road and Atelier. Stop on Swan Street or Bridge Road for lunch in a restaurant or café, many of which offer a genuine taste of Greece. Church Street is the place to go for designer furniture and objets d’art. Try for a booking and savour the tastes at stylish mod-Oz restaurant, Pearl.

Nearby Victoria Street, or Little Saigon, is the heart of Melbourne’s Vietnamese community. Wander among the long stretch of eateries, bakeries, butchers, fishmongers and grocers and grab a bite along the way. Don’t expect white linen tablecloths and hovering waiters – Victoria Street is about the hustle and bustle of fast, fresh and exceptional Asian food at a bargain price. Bars and live music thrive in Richmond, the Corner Hotel being one of Melbourne’s most famous intimate live-music venues, hosting big-name bands alongside obscure newcomers. Just across Swan Street, Dizzy’s Jazz Club is known for its quality acts. Sip a cocktail in refined surrounds at Der Raum, or celebrate the hops and tour the Carlton & United Breweries’ brewhouse in Abbotsford.

From the city, you’re just 10 minutes from Richmond. Take the number 70 tram from Flinders Street to Swan Street or number 109 from Bourke Street to Victoria Street, number 48 or 75 from Flinders Street to Bridge Road. Alternatively, jump on the  train and travel just one stop from Flinders Street Station.

‘Ruby’ apartments(yellow shaded area) are located just across the road from Victoria Gardens Shopping centre, one of the regional shopping centres in Victoria under the Centro Properties Group. There’s Ikea, Coles, Cinemas and Kmart within the shopping centre and a hosts of restuarants and cafes that go along with it.

With all these fundamentals in place, one can be forgiven for overlooking the fact that Richmond used to be a Vietnamese dominated community and had a stigma for not being one of the most desirable areas to live in. However, the community is changing rapidly, being close to some of the most expensive suburbs like Kew, Hawthorn and East Melbourne, it is no wonder this suburb has become more popular with young professionals working in and near the city.

If you would like to find out how this development is going to fit into your property portfolio, don’t hesitate to email me. Have a great weekend ahead!

Elm consists of units for owner-occupiers and investors. What investors need to be careful of in elm, apart from buying a unit with a view, is to ensure that the numbers for your investment property ’stack up’. What does it mean by ’stacking up’?

You want to ensure your holding cost is kept to the minimum so you will need a unit with the highest possible rental yield. The 1-bedders would be renting anything from $380-$420/week in the current market. If the 2-bedders top $570/week in rent currently, for a 5% rental yield, you shouldn’t be getting anything more than $592,800 in unit. Otherwise you will find outgoings like interest cost, body corporates eroding away your returns.

All our investors in elm got 1-bedders in there. That’s not to say 2-bedders aren’t good. It’s just that the yield won’t be as good as the 1-bedders. And that’s what I have concluded from my years of investing in Australia.

Email me your comments at info@pagreal.com

Elm is a 22-storey development by Fridcorp. Launched early last year, construction has already started on this development located along 18-24 Dorcas Street. I visited the site in June 2008 and back then there was a display unit being constructed under the old building for the purpose of marketing the units. Essentially, the development consist of 1 and 2-bedders, and the first four levels are parking lots for residents and visitors to the development. The fifth floor is where the pool and the gym are located together with eleven 1-bedders and six 2-bedders. The building has similar floor plate for levels 6,8,9,11-15; apparently the floor plates were somehow improved and they are a little different from the time they were launched last year.

I can only say that more 1-bedders were created in these levels, and being close to the city it is quite a sensible thing to do. On the east of the development is a 18-storey building (you can quite easily verify that on google earth) so if you are after the views of the Domain Oval next to the Botanic Gardens, you will have to go higher up(at least above 19th floor). On the western side of the building, it is literally unblocked. So if you go higher up (15th floor and above), you will get bay views. The southerly aspect of the building (facing Dorcas Street) will have views to the Albert Park Lake (famous Australian Grand Prix circuit) while the northerly aspect looks back to the city with nice city views. However there might be a chance that some of the older buildings around it might be demolished for a new tower.

I have a fairly good understanding of the development; the latest update from the developer is as such:

Construction works are proceeding on schedule.
Piling is complete, the basement slab and walls have been poured.
Part of the ground floor tenancy slab has been poured and the jump form is being erected to the lift core.
At this stage, the project is on completion for late 2010.

For some of you who are in Singapore and wants to have a chat with me for a more independent view of the development and the original price list, you may contact me at 98344408 or email me at info@pagreal.com.

Have a great weekend ahead!

The Reserve Bank left interest rates at record lows for a third straight month but indicated it has room to make further cuts if necessary.

After a meeting of the central bank’s board, the RBA left its cash rate at 3 per cent, a 49-year low - the same rate that has applied since its last cut in April, which was made in response to a slowdown in the economy.

”It looks as if the RBA is on hold for the longer term,” said Matt Robinson of Moody’s Economy.com. ”There is no real need or desire for further easing.”

Click here for more details.

While property market overseas suffered following the financial crisis last year, the Australian property market has proved to be resilient compared to countries like UK and US. Quoted in a report by The Age on the 25 June 2009, it was reported, ‘While house prices in most other developed economies have tumbled significantly since the global financial crisis, Australian house prices have been resilient, softening only 1.2 per cent in the year to May 2009,” ANZ said, citing data from property value monitoring group Residex.’

While the first homes owners’ grant has fueled the demand for housing in the mass market. the property market is further boosted by record levels of emigration levels due to a large number of Australians returning back to Australia. With major development projects stalled due to shortage of funds, the rental market is set to skyrocket.

For a full report, click Home prices to ‘edge up’ despite job losses