Aussie houses are now smaller, but apartments are growing

DESPITE Australia still building some of the biggest dwellings in the world, our freestanding house footprint is actually starting to shrink to its smallest size in nearly two decades.

According to a CommSec Home Size Trends Report, the average size of an Australian freestanding house has fallen to a 17-year low.

Data commissioned by CommSec from the ABS showed that the average new house built between 2018 and 2019 was 228.8sq m — the smallest house size since the 2001/2002 financial year.

Canberra appears to be bucking the trend and is the national capital of big houses according to the CommSec analysis, then comes Victoria, Western Australia and Queensland. NSW, our most populous state, is home to new houses sizes 10 per cent smaller than Victoria.

How we compare

While some corners of the country are still home to plenty of McMansions, houses in the US are still bigger than Aussie houses by around 5 per cent. The average new house built in the US last calendar year was 240.4sq m.

On the flip side, however, in New Zealand the average home built during the same period was just 164.4sq m, around 13 per cent smaller than in Australia.

The local study showed that seven years ago, Aussies were building the biggest freestanding houses in the world, but since then home buyers Down Under have started to embrace apartments, as well as smaller houses on smaller lot sizes.

Although we are collectively scaling back our floor plans, Australians can’t yet claim a minimalist mindset when it comes to bricks and mortar — especially when compared to those who built before us. The data showed that houses built in Australia over the past year are still far bigger than those built in the 1980s and 1990s. In fact, new houses are around 5 per cent bigger than 20 years ago and 25 per cent bigger than 30 years ago.

And it’s not just the size that matters, it comes down to price as well.

The CommSec report also pointed out that not only are houses far bigger than those built in the 1980s and before, but the standard of fit-out today is far superior with top-notch kitchens, designer bathrooms, floor coverings and hi-tech inclusions like air-conditioners.

Who’s living at home

When the first Census was conducted in 1911, an average of 4.5 people lived in every home but by 2006 that had fallen to 2.4 people.

However, from 2006 to 2013, the number of people per dwelling started to climb again as adult children stayed at home longer due to the rising cost of buying or renting their own place.

Add to that an ageing population, more generations choosing to stick together under one roof, as well as new migrants staying with extended family or friends and bigger homes were on trend.

But now things have come full circle and according to ABS data, since 2014 the number of people per dwelling has been falling again off the back of lower interest rates and the increased supply of cheaper apartments and townhouses (compared with freestanding houses). As a result, retirees are downsizing and Millennials are moving out of home.

The move to apartments

While freestanding houses now account for just over half of all new homes being built across Australia, high-rise apartments and townhouses are actually most in demand.

Eight years ago, around 27 per cent of homes built were apartments, however, today they account for 41 per cent.

The CommSec study highlighted that an increasing number of Australians — especially in Sydney and Canberra — want smaller homes like apartments, semi-detached homes and townhouses.

The popularity of apartments has actually had the opposite effect on flats compared with freestanding homes.

The average national apartment size has grown by more than 3 per cent, although NSW apartments built in the 2018/19 period were actually the smallest in 20 years of records.