Disruption. It’s somewhat of an industry buzzword these days. Corporate banter is peppered with the concept of ‘disruption’ that suggests some type of radical change or new approach to an old problem is necessary, if you want to stand out in today’s sea of ‘sameness’.
When virtually every man, woman and child on the planet can talk to a global audience via the world wide web, there really are no limits on where we can take the new world order of innovation that many suggest is currently evolving.
These are indeed, exciting, edge of your seat times we’re living in. If we can focus on the positive potential of what we are capable of creating, in terms of interesting and groundbreaking new solutions to the same old problems, then disruption can be a powerful tool.
It’s time we shook things up a little and got uncomfortably real about where we want the future to go.
Accentuate the positive!
One thing I guarantee that successful property investors are not doing on a daily basis is absorbing every bad news story on our property markets like it was gospel.
Abundant investors know that dwelling on hard news stories will only beget bad luck. Because you make your luck, just as you make your fortunes.
My point being, it’s high time we step out of the chaos of an over-analysed problem – and the fear that goes with it – and discuss genuine, authentic, plausible solutions.
And it seems that’s what disruption does. It encourages discourse around hard to solve, habitually problem dominated industry issues, because it challenges stagnant stereotypes and social inequities head on.
What does that mean? Well take ,for instance, the issue of housing affordability that’s plaguing our property markets.
Most people would agree that we have a ‘housing affordability’ problem in Australia. I mean, the media hits us over the head with it constantly, not to mention the realities we see future generations facing when it comes to particular pockets of major city housing markets.
As with any problem however, there’s surely a solution to be had. It’s really all perspective. But when you have a newsfeed that largely runs on negativity, it can be tricky to see those solutions. It’s much easier to see ongoing issues. The reasons why it’s too hard to tackle.
During the recent federal budget announcement, there was a very real sense that the housing affordability ‘crisis’ had become too big of a problem in the collective political minds of Canberra, to the point they seemingly decided to skirt around it.
They promised a lot in the lead up…but genuine solutions for affordable housing were largely overlooked in favour of vote grabbing bank levies. It’s almost like the government threw its hands up and said, “Tax the banks! The people will love it! They hate the banks almost as much as they hate us!”
Tackling the hard issues head on
The reason disruption is such an interesting concept in this world is that it challenges apparent ‘hard to fix’ problems with often simple and logical solutions. And the people who come up with these practical solutions get paid lots of money! As they should, because they are ringing in change!
Of course disruption isn’t necessarily always positive, but it can be in many instances.
When we talk ‘disruption’ in the housing affordability equation for instance, many new ideas that are surfacing (and some older ones that are resurfacing) to put property back within reach of ‘the masses’, often speak to more sustainable living and less environmental impact as well.
In solving a large social AND financial issue, disruptors are also helping to address an environmental one, and often there are flow on effects in stronger community connection and the like as well. All the good things!
See what focusing on the solution brings? So in celebration of solutions, and creative disruptors looking for a way to make housing not simply more affordable, but also financially and environmentally sustainable, let’s look at a few ways innovative thinkers are taking back their home buying power throughout the world…
Micro-apartments
Sydney and Melbourne property prices in particular are beyond many middle income earners, who are often employed in the essential services that communities need to thrive, such as teachers, nurses, police officers and the like.
So where do you live when the average one bedroom apartment costs quarter of a million plus? Well, as many New York and London dwellers are doing, you could consider a teeny tiny apartment.
So-called micro-apartments have caused some controversy, with Melbourne’s Lord Mayor Robert Doyle, openly opposing their construction in his city. However, for proponents who have little other option, these apartments are just as liveable, albeit somewhat snug.
The most spacious micro apartments boast around 50 square metres of living, but some can be as little as 35 square metres, just within the Sydney planning parameters.
Of course there’s also certain financing considerations when you start talking tiny spaces too. But director of Plus Architecture Craig Yelland, says there’s no reason small apartments couldn’t be some people’s big dream homes.
“Should you have a right to choose a smaller, affordable apartment or should you be forced to buy something $120,000 more expensive and as a result you can’t have your own apartment anymore?” asks Yelland.
Big World Homes
Another disruptor on our doorstep is Big World Homes. Founder and architect Alexander Symes conceived the creation of pop up, transitional housing communities, with the first home of its kind constructed in Sydney last year.
Big World Homes are portable, off the grid constructions, designed to be built in a just a few days by two people using a hammer and drill. Plus, they’re technically considered caravans and can be parked on any private land, with permission of course.
Without the labour and land costs, the purchase price of a Big World Home is 80 per cent cheaper than your standard Sydney dwelling, at a cost of between $60,000 to $80,000 to buy and complete.
Dr Joanne Jakovich, co-innovator of BWH says, “The re-thinking of ‘space’ and ‘wealth’ is to housing what the sharing economy was to capitalism – Big World Homes has an expansive effect, creating a new life and new communities in the city.”
Co-living with class
Community is a common theme running through most ideals around disruptive problem solving in otherwise restrictive property markets, with various forms of collaboration and shared use of resource.
Co-living is upscale share housing for young, career-minded professionals. All across America people are moving in to purpose built, high-end group accommodation with communal living spaces.
In one complex, tenants enjoy weekend art workshops, Sunday potluck dinners, and a social messaging app for residents to post invitations to one another when they feel like some company.
This is the micro-apartment trend, with a conscious bent toward community living.
Disruptive construction
Methods of manufacture for more cost effective housing is another obvious area in which disruptive practices can positively address affordability levels in Australia’s real estate markets.
Tiny homes are of course creating big solutions for today’s first time property buyers who are willing to start out with a more modest home ownership dream, as previous generations once did.
Modular homes that are prefabricated in a factory and then transported to the construction site where all the pieces are assembled are growing in popularity throughout the world, with many companies actively exploring ways to make them increasingly eco-friendly.
And another high tech advancement in residential building processes will eventually see the creation of dwellings by 3D printer. While this technology is still evolving, a few rudimentary structures have already been printed around the world, with a two-storey, concrete building recently printed in China over 45 days.
As our inner city real estate markets continue to trundle along, pushing more potential buyers to the periphery as they go, we’ll have to come up with other creative solutions to inspire more affordable housing options.
Moaning about it and becoming entrenched in a problem you can’t possibly see a way around is futile. Indeed, we need to disrupt that pattern, which seems ingrained into the very fabric of the real estate world, where people sit around and talk up a property bubble based on the fear of what might one day eventuate.
It’s time to celebrate the disruptors and challenge conventional thinking about what constitutes affordable housing. Affordable doesn’t necessarily mean compromise. Quite the contrary, in many instances of disruption, it seems to mean finding your community and living the dream on a whole new level.
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).