As the dream of home ownership continues to elude a growing number of young Australians, there’s an increasing call to address what could become a serious social issue for our nation’s future.
It’s anticipated that our population will reach a staggering 42 million people by 2050, which begs the question, how will we accommodate these new residents within the confines of current development and planning policies?
Given all necessary infrastructure, amenity and industry is housed within the confines of Australia’s major capital cities, it makes sense that we continue to provide additional housing in these key locations.
However, with demand outpacing housing supply levels throughout Melbourne, Sydney and increasingly across Brisbane, there’s still the conundrum of affordability in these residential centres, largely due to constraints on developable land supply.
When upwards is onwards
While high-density development has traditionally been a dirty word in this country – we’ve historically shown a collective penchant for large detached dwellings over apartment living – this seems to be the most plausible solution to our current “affordability crisis” at this time.
It used to be that governments had great opposition to higher density development, largely due to community outcry whenever it was suggested that anything more than three stories high be built on the periphery of our big cities. “Not in my neighbourhood!” was the general consensus.
Things are slowly changing however, as apartment buildings become increasingly commonplace in Melbourne, Sydney and Brisbane. QBE recently reported that high and medium density construction now accounts for 57 per cent of all new dwelling stock to come online in Brisbane, up from 36 per cent last year.
While medium to high-density development conjures up images of housing commission flats bordered by uninspiring concrete cityscapes, along with accompanying negative environmental and social connotations, it really doesn’t have to be this way.
In fact, density done well can be incredibly beneficial on many levels, bringing a myriad of social, economic and environmental advantages.
Indeed, embracing the idea of higher density living is becoming a necessity, when we consider the median house price in Sydney is currently an eye watering $1.177 million.
The benefits of building higher
Obviously the biggest potential benefit in higher density construction is the economic impact. Cheaper units are logically a more attainable financial reality for those looking to break into the housing market, without being pushed to the peripheries of our outer ‘burbs.
High-rise accommodation can also facilitate social diversity and mean less urban sprawl, which can have positive environmental connotations.
Building upwards, rather than outwards, means better utilisation of existing infrastructure and amenity, rather than putting increased pressure on government coffers to expand road and rail networks.
Then of course there’s the industry and employment factor. It’s tricky to service a mortgage without access to a steady income stream. And as we know, most employment opportunities are heavily skewed toward our inner cities. Again, it makes good, logical sense to increase accommodation availability in these key centres, where industry is already well established.
The middle tier
Of course additional future dwellings don’t have to be limited to monolithic, high-rise apartment towers. There’s also a middle road – somewhere between a house and high-rise – which is middle density development.
There are already numerous examples of this working well across Australia, with communities of townhouses, duplexes, low rises, mixed-use developments and a combination of all the above, thriving nicely in their inner urban settings.
With considered design, planning and collaboration, there’s really no reason this middle tier density development couldn’t be the future response to affordability barriers currently standing in the way of young people acquiring their own home.
Of course this won’t be a plausible scenario for every area, and there will always be demand for outer suburban family homes in this country, I have no doubt. But it’s time we stopped demonizing higher density development and instead embrace greater diversity in our housing markets…If not for our sake, for the sake of our children and their children.
About the Author
Since 2008, David Thomas has built a business aimed at servicing the needs of property investors, owner occupiers and small business owners. David is recognised as one of the top 10 independent mortgage brokerages in the country, David and his team have settled almost billions of dollars worth of residential and investment loans over the last decade.
Known for his straightforward, relatable style, David believes by educating people about property funding; they fare better in the market. By sharing his expertise openly, some of the people he educates will likely become his clients. It's a win-win approach.
David Thomas is a credit representative (Representative Number 506153) of BLSSA Pty Ltd, ACN 117 651 760 (Australian Credit Licence 391237).