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RESIDENTIAL MARKET & ECONOMIC OUTLOOKNEW SOUTH WALES, SYDNEY & CLEMTON PARK

KEY DRIVERS OF INVESTMENT PERFORMANCE

POPULATION – INFRASTRUCTURE – EMPLOYMENT

POPULATIONPopulation growth is an underpinning factor in demand for the residential property market. Identifying regions with strong population growth improves the potential growth in the value of property investments, and access to a growing market and future household formation.

INFRASTRUCTURE Locations supported by adequate infrastructure and services improve the value derived from locational driven amenity. Developments with the right amenity and services within walking distance or transit accessible supports both the local areas ability to sustain population growth and the desirability of the development.

EMPLOYMENT Proximity and access to employment nodes is essential for strong residential growth. It supports future population as well as opens up a local worker market for residential developments, with workers seeking housing within easy transit to their place of work. This can be provided either through developing close to existing and planned employment centres or within easy access to public transport connecting local residents to their place of work.

EMPLOYME

NT P

OP

ULATION

INFRASTRUCTURE

IP E

Residential property assets are a long term investment, with value underpinned by key fundamentals.The underlying drivers of residential property value have been identified as ‘locational’, with the amenity derived from proximity and access to employment, services, recreation and social infrastructure. Product alone is unlikely to drive demand like it has in the mid 2000’s, with place superiority now a key driver behind the success of high density residential property assets.

Finishes and views will no longer compensate for developments in marginal locations moving forward. Long-term value growth will be the most important motivator for buyers moving forward, and in today’s new market demand those regions accommodating a unique formula that will dominate the landscape over time.

Urbis has investigated the trends that will deliver sustained

and confident growth now and into the future. This involves recognising the key fundamentals that investors should seek to secure returns as well as identify regions that will be the most desirable to live, work and play. To help identify these locations, Urbis has concluded that the most desirable locations will be those locations accommodating “P.I.E.”: Population, Infrastructure and Employment.

CON

TEN

TS KEY DRIVERS

METROPOLITAN SYDNEY

DEMOGRAPHIC INSIGHTS

020304

ACCESS TO EMPLOYMENT CENTRES

FUTURE INFRASTRUCTURE INVESTMENT

LOCAL AMENITY

050607 RENTAL ANALYSIS

OUTLOOK INSIGHTS

RELATIVE PRICING COMPARISON

INVESTMENT MARKET

091012

08

PERIOD �ANNUAL�

SOURCE : URBIS; AUSTRALIAN BUREAU OF STATISTICS 2011; NSW PLANNING & ENVIRONMENT

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

2027

2028

2029

2030

2031

POPU

LATI

ON �#

�

3,000,000

3,500,000

4,000,000

4,500,000

5,000,000

5,500,000

6,000,000

6,500,000

ACTUALPOPULATION

1,515 NEW RESIDENTS PER WEEK

21.4% OF SYDNEY SD POPULATION

0 50,000 100,000150,000 200,000250,000300,000350,000400,000

Gen A 0-4

Gen Z 5-9

Gen Z 10-14

Gen Y 15-19

Gen Y 20-24

Gen Y 25-29

Gen Y 30-34

Gen X 35-39

Gen X 40-44

Gen X 45-49

Boomers 50-54

Boomers 55-59

Boomers 60-64

Boomers 65-69

TG 70-74

TG 75-79

TG 80-84

TG 85+

NUMBER OF RESIDENTS

GEN

ERA

TION

S

NUMBER OF RESIDENTS NOT INC GROWTH NUMBER OF RESIDENTS INC GROWTH

Greater Home OwnershipCivic MindedMaintatin Social NetworksDiversity is Key

More DownsizingLow Maintenace LivingLifestyle OrientatedAmenity Rich Locations

DIMINISHING BOOMERS

LARGEST MARKET

29.4% OF SYDNEY SD POPULATION

Still Growing – 1,515 New Residents Per WeekSydney is Australia’s leading property market in size, value and quality of projects. The Sydney market is expected to continue to grow as population growth increases (projected at 1,515 per week for the next 20 years, as forecast by NSW Planning and Environment) and opportunities for infill development increasingly become rare. This exceeds historic actual growth observed between 2006 and 2011 which was 1,280 new residents per week, for a total increase of 64,800 per annum over this period.

Housing supply will continue to have difficulty keeping pace with population growth in the foreseeable future. During 2011 (the year of the last census) demand for new housing was 24,000 dwellings whilst only 16,700 dwellings were produced.

We will see a greater shift of Gen Y toward home ownership from 2016This demographic shift presents market opportunities and threats to residential developers and investors, namely:

• Sydney will continue to see population growth close to 79,000 per annum for the next 20 years.

• Housing supply will continue to have difficulty keeping pace with population growth in the foreseeable future. During 2011 (the year of the last census) demand for new housing was 24,000 dwellings whilst only 16,700 dwellings were produced.

• Generation Y will be the largest population cohort to enter the housing market, with this group anticipated to experienced a growth in demand from 2016.

• Apartment living is becoming as increasingly desired form of housing with 75% of all new housing currently being provided in infill areas through apartment developments over the past 5 years.

Focus on the Biggest Markets – Focus on Gen Y

Sydney is expected to see a shift of Gen Y’s into home ownership and occupation within the next four years.

There are considerable affordability constraints for this segment of the market. However, the age group has certain characteristics:

• They will marry later and have families even later;

• They are very accepting of density, however demand amenity; and

• A high proportion believe they do not have to move to the suburbs once they have kids.

As such, large proportions are expected to remain in locations around key centres, notably the CBD and Inner/Middle Ring where they have a high level of amenity and accessibility.

METROPOLITAN SYDNEY – RESIDENTIAL DRIVERS SNAPSHOT

SYDNEY POPULATION GROWTH

PRODUCT MIX

SHIFTING DEMOGRAPHICS

Existing Constraints: Affordability constraints within inner city or fringe locations – the youth market cannot afford to buy and are forced to rent (albeit positive for investors).

Future Opportunities: Compact urban design in inner and middle ring allows for more affordable product while allowing younger purchasers to maintain existing social and amenity networks.

Sydney Population Growth

URBIS OUTLOOK 3© URBIS.COM.AU

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RO

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LIDCOMBESTRATHFIELD

BURWOOD

CROYDONLEICHHARDT

ASHFIELD

REGENTSPARK

GREENACRECHULLORA

ENFIELD

STRATHFIELDSOUTH

SUMMERHILL

POTTSHILL

BURWOODHEIGHTS

PETERSHAM

LEWISHAM

CROYDONPARK

YAGOONA

ASHBURY

DULWICHHILL

BELFIELD

MARRICKVILLECAMPSIE CANTERBURY

HURLSTONEPARK

BANKSTOWNBELMORE

LAKEMBAMT LEWIS

EARLWOOD

PUNCHBOWL

TEMPE

WILEYPARK

CLEMTONPARK

ROSELANDS

WOLLICREEK

TURRELLA

KINGSGROVE

ARNCLIFFE

BARDWELLPARK

BARDWELLVALLEY

PADSTOW

BEXLEYNORTH

BEVERLYHILLS

RIVERWOOD NARWEE

BEXLEY

BANKSIA

ROCKDALE

KYEEMAGH

HURSTVILLEBRIGHTON-LE-SANDS

PEAKHURST

PENSHURST

KOGARAH

Source: Urbis; Australian Bureau of Statistics 2011; NSW Planning and Environment

DEMOGRAPHIC INSIGHTS – CANTERBURY

An important element of underlying demand for housing, and of key relevance to developers and investors alike are the preference for different housing types for each demographic as their age and housing structure changes.

The table below illustrates the significant role Generation Y will play in the property market in the coming years, with its proportion of the population increasing to 31.9% by 2016 and 33.1% by 2021, will largely dominating the population until 2031.

CANTERBURY AGE DISTRIBUTION FORECASTS

GENERATION BORN AGE %POP AGE %POP AGE %POP AGE %POP AGE %POP

BABY BOOMERS

1946–1964 50-69 20.0% 55-74 19.1% 60-79 17.6% 65-84 15.8% 70-89 14.7%

GENERATION X 1965–1979 35-49 21.5% 40-54 21.0% 45-59 20.0% 50-64 18.9% 55-69 17.9%

GENERATION Y 1980–2000 15-34 29.6% 20-39 31.9% 25-44 33.1% 30-49 32.9% 35-54 32.0%

2011 2021 20312016 2026

DEMOGRAPHICS HIGHLIGHT GENERATION Y HOUSING MARKET

Demographic shifts in population growth have been accredited as vital determinants of economic growth as well as property market demand and supply fluctuations. The Canterbury resident population while fluctuating between 2001 and 2011 is expected to grow by 1,840 new residents per annum, from 145,088 in 2011 to 181,850 in 2031.

Applied to the average household size in the 2011 census this equates to 657 new houses required per annum to accommodate projected demand. This increase in underlying demand could potentially underpin residential property in this area over this timeframe, as shown in the figure below .

CANTERBURY POPULATION GROWTH

SOURCE : URBIS; AUSTRALIAN BUREAU OF STATISTICS 2011; NSW PLANNING & ENVIRONMENT

POPU

LATI

ON �#

�

136,684 134,824

145,088

152,600

161,900

171,750

181,850

120,000

130,000

140,000

150,000

160,000

170,000

180,000

190,000

2001

2006

2011

2016

2021

2026

2031

1,838 NEW RESIDENTS PER ANNUM

Consistent growth expected through to 2031

The Canterbury LGA has a lower median income than the wider Sydney Greater Metropolitan Region (GMR). This aligns with the younger demographic profile of the area, likely to be maintained in the short-term given the dominance of generation Y as the main age cohort entering the market. This will drive demand for more affordable residential property, including higher density housing products and in particular, rental property.

MEDIAN INCOME

$55,718

$72,731

$94,428

$44,411

$55,088

$70,999

$0

$10,000

$20,000

$30,000

$40,000

$50,000

$60,000

$70,000

$80,000

$90,000

$100,000

2001 2006 2011

MED

IAN

INCO

ME

$

CANTERBURY

GREATER SYDNEY

SOURCE : URBIS; ABS 2001, 2006 AND 2011 CENSUS

• Government population projections for Canterbury Local Government Area estimate that the population will grow by approximately 1,840 new residents per annum to 2031.

• Average income levels within Canterbury are lower when compared to the Greater Sydney area, however this tends to drive higher demand for rental property and higher density forms of housing.

• Canterbury will experience growth in its Generation Y population who are expected to be the largest age cohort in the property market as renters and purchasers from 2016 onwards (Generation Y comprises people born between 1980 and 2000).

4 URBIS OUTLOOK © URBIS.COM.AU

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LIDCOMBESTRATHFIELD

BURWOOD

CROYDONLEICHHARDT

ASHFIELD

REGENTSPARK

GREENACRECHULLORA

ENFIELD

STRATHFIELDSOUTH

SUMMERHILL

POTTSHILL

BURWOODHEIGHTS

PETERSHAM

LEWISHAM

CROYDONPARK

YAGOONA

ASHBURY

DULWICHHILL

BELFIELD

MARRICKVILLECAMPSIE CANTERBURY

HURLSTONEPARK

BANKSTOWNBELMORE

LAKEMBAMT LEWIS

EARLWOOD

PUNCHBOWL

TEMPE

WILEYPARK

CLEMTONPARK

ROSELANDS

WOLLICREEK

TURRELLA

KINGSGROVE

ARNCLIFFE

BARDWELLPARK

BARDWELLVALLEY

PADSTOW

BEXLEYNORTH

BEVERLYHILLS

RIVERWOOD NARWEE

BEXLEY

BANKSIA

ROCKDALE

KYEEMAGH

HURSTVILLEBRIGHTON-LE-SANDS

PEAKHURST

PENSHURST

KOGARAH

21,473 new jobs

Sydney Olympic Park/Homebush

CLEMTON PARK

Port Botany 10,985 new jobs

8,046 new jobsGreen Square

46,983 new jobsParramatta

161,987 new jobsSydney

15,511new jobsBankstown

Rail Lines

ACCESS TO EMPLOYMENT CENTRES

Clemton Park Village is situated within the Local Government Area (LGA) of Canterbury, approximately 13.6 km west of the Sydney CBD. The site sits just south of Canterbury Road which runs West-East, with the Canterbury Hospital located immediately north of the Charlotte Street and Canterbury Road intersection.

The combination of these employment nodes equates to approximately 265,000 new jobs by 2041 and a worker purchaser/rental market accessible to residential development in Sydney’s middle ring.

As Canterbury’s population continues to grow over the next 30 years, and fewer opportunities for infill development remain, the amenity driven by access to these growing centres by tomorrow workers will be invaluable.

ACCESS TO EXISTING AND FUTURE EMPLOYMENT CENTRES

FORECAST EMPLOYMENT – UNTIL 2041

EMPLOYMENT NODES AND PUBLIC TRANSPORT

SIGNIFICANT JOB GROWTH WILL POTENTIALLY UNDERLINE GROWING DEMAND FROM WORKERS FOR HOUSING CLOSE TO EMPLOYMENT CENTRES.

161,987 new jobsSYDNEY CBD

46,983 new jobsPARRAMATTA CBD

21,473 new jobsSYDNEY OLYMPIC

PARK/AUBURN

10,985 new jobsBOTANY BAY

8,046 new jobsGREEN SQUARE

15,511 new jobsBANKSTOWN

NEW JOBS BY 2041

Source: Urbis; Bureau of Tranport Statistics

URBIS OUTLOOK 5URBIS OUTLOOK 5© URBIS.COM.AU


CLEMTON PARK

LIGHT RAIL EXTENSION

WESTCONNEX M5 EAST DUPLICATION

PROPOSED M6 CONNECTION

WESTCONNEX M4 EAST

SYDNEY OLYMPIC

PARK

SYDNEYAIRPORT

PORTBOTANY

UTSUoS

UNSW

UWS

Rail Lines

MAJOR EXISTING AND PLANNED INFRASTRUCTURE

Clemton Park Village is located centrally to significant existing and proposed infrastructure which are summarised below.

EXISTING INFRASTRUCTURE

• Sydney Airport

• Port Botany

• Sydney Olympic Park

• University of Sydney (UoS)

• University of Technology Sydney (UTS)

• University of New South Wales (UNSW)

• Lilyfield to Dulwich Hill Light Rail Extension


PROPOSED INFRASTRUCTURE

• WestConnex M4 East Extension – construction of new motorway tunnel to connect existing M4 to City and Airport (proposed completion 2020)

• WestConnex m5 to East Duplication – duplication of existing motorway tunnel to increase capacity to City and Airport (Proposed completion 2020)

• Long term proposal for M6 connection to the F6 Freeway to the Illawarra (Mentioned in NSW Long Term Transport Masterplan December 2012)

• CBD and South East Light Rail – will form the new Sydney Light Rail network, with reliable, high capacity services running north from Central to Circular Quay along George Street, west to Pyrmont and Dulwich Hill, and south east through Surry Hills to Moore Park, Randwick and Kingsford


Canterbury Rd

Bexley Rd

Jere

ySt

King St

Brighto

n Ave

Punchbo

wl Rd

Moorefields Rd

StBeam

ish

William St

CANTE RBURYPARK

RACEC OURS E

LEESPARK

RUDDPARK

CANTE RBURYPARK

TASKE RPARK

HUGH ES PA RKEARLW OOD

PARK

CLEM TONPARK

CANTE RBURYGOLF CO URSE

BEVE RLY GRO VE PA RK

M5 MTWY

1km

2km

33

36

3437

32

39

42

40

31

35

38

41

30

27

29

25

26

24

22

16

19

8

18

4

5

17

20

14

7

6

9

1011

13

21

15

12

2

3

1

CAMPSIE

BELMORE

CANTERBURY

BARDWELLPARK

BEXLEY NORTH

KINGSGROVE

28

250 Meters

Flemings

Big W

Woolworths

V Plus

Coles

Aldi

5 Star

Welcome Mart

LOCAL AMENITY

HOSPITAL1 Canterbury Hospital

LIBRARIES2 Campsie Library3 Earlwood Library

SCHOOLS & TERTIARY INSTITUTIONS4 All Saints Grammar School5 Belmore Boys High School6 Belmore North Public School7 Belmore South Public School8 Campsie Public School9 Canterbury Boys High School

10 Canterbury Girls High School11 Canterbury Primary School12 Canterbury South Public School13 Clemton Park Public School14 Coaching College15 Earlwood Public School16 Harcourt Public School17 Kingsgrove North High School18 MacCallum Hill Public School19 Our Lady of Fatima Primary

School20 Rissalah College21 St Mel’s Primary School22 St Michael’s School

COMMUNITY CENTRES24 Ashbury Senior Citizen Centre25 Australia Ga Community Club26 College of Further Education27 Ken Watson Memorial Hall28 PCYC29 Salvation Army

RECREATIONAL FACILITIES30 Canterbury Olympic Ice Rink31 Ashbury Bowling Panarcadian

Fed Clb32 Australian Academy of

Gymnastics

33 Belmore Bowling Club34 Belmore Stadium35 Bexley Bowling Club36 Campsie South Bowling Club37 Canterbury Bomkstion Rugby

Club38 Canterbury Park Racecourse

Center39 Earlwood-Bardwell Park Sports

Club40 Physical Fitness Club41 Sydney Turf Club42 Trinity Gram School Tennis

Center

CLEMTON PARK VILLAGE Note: Distance is approximate


INVESTMENT MARKET

APARTMENT SALES CYCLECHANGE IN MEDIAN PRICE (% CHANGE PER ANNUM)

PREPARED BY URBIS. SOURCE: RPDATA

Average annual growth for strata dwellings within Canterbury has outperformed the wider Sydney Metropolitan market for strata dwellings over 10 years from March 2004 to March 2014.

Median sales price for strata dwellings in Canterbury have increased by 5.0% per annum (compounding) over the past 10 years compared to strata dwellings in the wider Sydney Metropolitan area which achieved 4% per annum (compounding).

Within the Canterbury market, strata dwellings have grown faster than non-strata products. This stronger price growth indicates a changing preference and demand for attached dwellings types, a broad move towards more affordable housing products, and an improvement in the quality of apartment developments.

STRONG CAPITAL GROWTH

Despite varying sales transactions for strata units in the Canterbury LGA over the past four years, the median price of strata residential has improved consistently since 2008. An improvement in prices combined with lower sales volumes (compared to 2009 levels) indicates healthy demand within a tightly held market.

The resilient median price point indicates strong underlying value within the Canterbury residential property market, underpinned by a demographic mix that supports more affordable dwellings compared to the Sydney average.

CAPITAL VALUE MAINTAINED DESPITE FALLING TRANSACTIONS

PRODUCT MARKET 5YRS 10YRS

STRATACanterbury 10% 5%

Sydney 7% 4%

NON-STRATACanterbury 8% 4%

Sydney 7% 4%

SOURCE : RP DATA; URBIS

SALE

S VO

LUM

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ATA

PR

ICE

0

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

$350,000

$400,000

$450,000

0

200

400

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1400

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2007

2008

2009

2010

2011

2012

2013

$390,750

$240,500


RELATIVE PRICING COMPARISON

INDICATIVE AVERAGE PRICE – NEW 2 BED, 2 BATH, 1 CAR UNITS

SOURCE : HOUSING NSW, URBIS

$637,000

$750,000 $780,000 $852,000

$947,500

$1,175,000

$0

$200,000

$400,000

$600,000

$800,000

$1,000,000

$1,200,000

$1,400,000

Clemton Park Village

Burwood Rhodes MacquariePark

Zetland Chatswood

Clemton Park Village is located within 12 kilometres of the Sydney CBD and has good access to key employment and infrastructure nodes. It is interesting to compare the relative price of product proposed for Clemton Park Village and other key areas of apartment development within Sydney. The map below demonstrates the relative price range of an average new 2 bedroom, 2 bathroom, 1 car park apartment in Clemton Park Village, Burwood, Rhodes, Macquarie Park, Chatswood and Zetland / Waterloo.


10km

5km

Macquarie Park circa $850,000 to $1,000,000

Rhodes circa $760,000 to $870,000

Burwood circa$700,000 to $900,000

Clemton Park Village circa $625,000 to $650,000

Chatswood circa $1,050,000 to $1,180,000

Zetland/Waterloo circa $890,000 to $1,000,000

Rail Lines

PRICE RANGE FOR NEW TWO BEDROOM STOCK

Note: Prices are indicative only


RENTAL ANALYSIS

Sydney apartment rentals have grown steadily since 2004. The Sydney rental market varies from region to region, however locational drivers are a key determinant in the premium paid for rental stock.

These fundamentals are illustrated by comparing apartment stock across inner ring (0-10km from Sydney CBD) and middle ring (10-25km from Sydney CBD) suburbs, with the premium paid for inner ring apartments on Canterbury LGA apartment rentals at 53% in March 2014 (Housing NSW).

This however has not been static, with the premium falling from 78% in March 2004 (Housing NSW). This indicates that middle ring suburbs are becoming more sought after, with infill opportunities within inner ring suburbs less available than 10 years ago, restricting supply. This creates opportunities for investors in middle ring locations to achieve increasing rental yields for middle ring apartment stock.

Canterbury within this context is still relatively affordable, recording a median apartment rental of $360 in March 2014, a 28% discount when compared to other middle ring locations (Housing NSW) .

SYDNEY RENTAL MARKET

$550

$460

$360

$100

$150

$200

$250

$300

$350

$400

$450

$500

$550

Mar

-04

Mar

-05

Mar

-06

Mar

-07

Mar

-08

Mar

-09

Mar

-10

Mar

-11

Mar

-12

Mar

-13

Mar

-14


INNER RING

MIDDLE RING

CANTERBURY

MED

IAN

APA

RTM

ENT

REN

T �A

LL B

EDR

OOM

S�R

ENT

�$ P

ER W

EEK

�

MEDIAN RENTAL COMPARISONS, APARTMENTS

While Canterbury residential apartments occupy the affordable end of the rental market, median apartment rents in Canterbury have increased at a faster pace than the wider Sydney Metro Area, with an annual growth rate of 7.2% per year from 2004 to 2014 compared to the Sydney GMR which achieved 5.8% over the same period (Housing NSW).

• Median rents for one bedroom apartments in Canterbury have grown generally in line with other middle ring suburbs one bedroom apartments at an average of 6.8% per annum between 2004 and 2014. This is approximately 1.2% per annum above average growth rates for median rents achieved by inner ring suburbs, which have grown by an average of 5.5% per annum over the same period.

• Median rents for two bedroom apartments in Canterbury have averaged increases greater than both middle ring and inner ring suburbs, achieving 7.2% growth per annum.

Despite this, the existing apartment rental stock is still an affordable alternative to more expensive inner ring locations for younger families, singles and couples working in surrounding employment nodes given that the median weekly rent for flats/units (all bedroom numbers) in Inner Sydney was 53% more expensive than in the Canterbury LGA in March 2014.

APARTMENT RENTAL GROWTH

$170 $179

$193 $200

$75

$100

$125

$150

$175

$200

$225

Mar

-04

Mar

-05

Mar

-06

Mar

-07

Mar

-08

Mar

-09

Mar

-10

Mar

-11

Mar

-12

Mar

-13

Mar

-14

MED

IAN

APA

RTM

ENT

REN

T �IN

DEX

�

SYDNEY GMR � 1 BED

SYDNEY GMR � 2 BED

CANTERBURY � 1 BEDCANTERBURY � 2 BED


CANTERBURY VERSUS SYDNEY GMR

MEDIAN WEEKLY RENTS FOR BOTH ONE BEDROOM AND TWO BEDROOM APARTMENTS IN THE CANTERBURY LGA HAVE AVERAGED INCREASES OF 6.8% AND 7.2% PER ANNUM RESPECTIVELY OVER THE DECADE TO MARCH 2014. OVER THE SAME TIME, THE MEDIAN CAPITAL VALUE FOR STRATA DWELLINGS IN THE CANTERBURY LGA INCREASED BY AN AVERAGE OF 5.0% PER ANNUM.


RENTAL APPRAISAL

While much of the existing stock within Canterbury is comparably affordable to middle and inner ring rental stock, the New Product vs. Existing Stock Product graph illustrates that there is a premium for new rental stock within the Canterbury rental catchment (sourced from Housing NSW).

Urbis market research indicates that on existing housing stock new 1 bed stock achieves a 48.3% premium, 2 bed stock achieves 61.1% and 3 bed stock achieves 17% on three bedroom detached housing (which was used as a proxy for 3 bedroom apartments given the availability of data on this product from NSW Housing).

New stock in Canterbury is attracting higher rental rates than existing middle ring rentals, as shown in the comparison between existing and new stock below.

NEW STOCK – RENTAL PREMIUM

$430 $455

$570

$290

$360

$530

$430

$580

$660

$0

$100

$200

$300

$400

$500

$600

$700

1 Bed 2 Bed 3 Bed*

MIDDLE RING MEDIAN RENTALS

CANTERBURY MEDIAN RENTALS

RENTAL CATCHMENT � NEW PREMIUM PRODUCT

*3 BED DETACHED DWELLINGS WERE USED AS A PROXY FOR ALL RENTALS DUE TO AVAILABILITY OF DATA

SOURCE : NSW HOUSING; REALESTATE.COM.AU; URBIS

NEW PRODUCT VERSUS EXISTING PRODUCT

The On The Market Rental Appraisal table below details the minimum and maximum rents that are being sought or have been obtained for comparable apartments within surrounding suburbs and within other comparable, middle ring developments.

In assessing the On The Market Rentals, we have had regard to:

• Views

• Location

• Floor and Position

• Amenity/Finishes

• Size

• Infrastructure/Employment

The availability of comparable two bedroom apartments with one bathroom was somewhat limited, and it is evident that most new developments are incorporating two bathrooms into two bedroom apartments. Two bedroom apartments with two or more bathrooms attract a rental premium of 4% above two bedroom apartments with one bathroom.

ON THE MARKET RENTAL APPRAISAL

ON THE MARKET RENTAL APPRAISAL - RENTAL CATCHMENT

BEDS BATH MINIMUM MAXIMUM MEDIAN

1 1 $420 $440 $430

2 1 $550 $560 $560

2 2 $560 $600 $580

2 +STUDY 2 $615 $630 $620

3 2 $630 $720 $680

3 2.5 $680 $775 $730

PRODUCT RENTAL RANGE PER WEEK

• Median rental growth for apartments in the Canterbury region has surpassed rates achieved throughout inner ring Sydney suburbs - annual growth has averaged 7.2% versus 5.6% over the past 10 years.

• In comparison to existing stock, new 1 bed units on average achieve a 48.3% rental premium, 2 bed stock a premium of 61.1% and 3 bed stock a 17% premium.

• Whilst achieving considerable premiums over established stock, new apartments remain affordable for younger families, singles and couples compared with more expensive inner ring areas.


OUTLOOK INSIGHTS

Sydney will continue to see population growth close to 79,000 per annum for the next 20 years.

Housing supply will continue to have difficulty keeping pace with population growth in the foreseeable future. During 2011 (the year of the last census) demand for new housing was 24,000 dwellings whilst only 16,700 dwellings were produced.

Generation Y will be the largest population cohort to enter the housing market, with this group anticipated to experienced a growth in demand from 2016.

Apartment living is becoming an increasingly desired form of housing with 75% of all new housing currently being provided in infill areas through apartment developments over the past 5 years.

METROPOLITAN SYDNEY – RESIDENTIAL DRIVERS SNAPSHOT Government population projections for Canterbury

Local Government Area estimate that the population will grow by approximately 1,840 new residents per annum to 2031.

Average income levels within Canterbury are lower when compared to the Greater Sydney area, however this tends to drive higher demand for rental property and higher density forms of housing.

Canterbury will experience growth in its Generation Y population who are expected to be the largest age cohort in the property market as renters and purchasers from 2016 onwards (Generation Y comprises people born between 1980 and 2000).

DEMOGRAPHIC INSIGHTS - CANTERBURY

Clemton Park Village is located centrally to a number of key employment growth hubs including the Sydney CBD, Green Square, Port Botany, Bankstown, Sydney Olympic Park and Parramatta.

Combined these key employment hubs will provide approximately 265,000 new jobs by 2041.

EMPLOYMENT

Clemton Park Village is located centrally to major infrastructure including Sydney Airport, Port Botany, Sydney Olympic Park, University of Sydney, UTS, UNSW, Lilyfield to Dulwich Hill Light Rail extention and University of Western Sydney (Bankstown Campus).

Significant infrastructure is being planned for areas around Clemton Park Village including the WestConnex Project (M4 and M5 Motorway extension / duplication project); proposed M6 collection from M5 to F6 freeway.

Local community amenities are substantial within the immediate surrounding area and include rail station and retail centre at Campsie; a number of education, recreation and community facilities and on site retail centre within Clemton Park Village itself.

INFRASTRUCTURE


Average annual capital growth for strata unit dwellings within the Canterbury LGA has out performed the wider Sydney Metropolitan Area over the 10 years from March 2014 to March 2014.

Median prices of strata residential units have continued to improved since 2008 despite a reduction in sales volumes, indicating that apartment stock is tightly held.

Pricing within Clemton Park compares favourably to other similarly located areas in relation to proximity to the Sydney CBD.

INVESTMENT MARKET

Rental levels within both the broader Sydney Region and the Canterbury LGA have grown consistently over the past 10 years, with the relative gap between inner city and middle ring suburb rental falling from 78% in March 2004 to 53% in March 2014 indicating the growing popularity of middle ring suburbs.

While Canterbury residential apartments occupy the affordable end of the market, they have experienced faster rental growth than the wider Sydney GMR, with an annual growth rate of 7.2% per annum compared to 5.6% in Sydney inner ring suburbs.

RENTAL MARKET

This publication is prepared on the instruction of Australand by Urbis for a fee. This publication is not an opinion or representation by or on behalf of Australand and Australand accepts no responsibility for the content of the publication and any reliance upon it. This report does not represent financial or investment advice as the publication involves projections and assumptions that can be affected by a number of unforseen variables, any investment decision must allow for the risk that, the accuracy of the forecasts may be affected by incorrect assumptions or by known or unknown risks and uncertainties. It must also be remembered that past performance is not a reliable indication of future performance.

The information in the publication has been prepared without taking into account your financial situation or investment objectives. You should consider the appropriateness of the information in regards to your current financial situation or needs. Neither Urbis nor Australand accepts any responsibility for the accuracy or completeness of this publication for your personal circumstances and you should take independent advice before making any decision to invest. The information is current as at the date of publication [July 2014] but subject to change without notice and Urbis and Australand are under no obligation to contact recipients of this report to update the information or correct any assumptions or inaccuracies which may prove to be incorrect at a later date so any matter of particular interest should be checked prior to any decision to invest.

This publication is subject to copyright. Except as permitted under the Copyright Act 1968, no part of it may, in any form or by any means (electronic, mechanical, photocopying, recording or otherwise) be reproduced, stored in a retrievals system or transmitted without prior permission. Enquiries should be addressed to the publisher, Urbis.


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