Apart­ments are de­vel­op­ing ev­ery­where; Ned Kelly’s house

Chang­ing de­mo­graph­ics and buyer ex­pec­ta­tions are driv­ing the shift to high-den­sity hous­ing

The Weekend Australian - Life - - FOOD & WINE - EMILY PETTAFOR

SYD­NEY de­vel­op­ers are reach­ing for the sky with a ver­i­ta­ble boom in apart­ment ap­provals, ac­cord­ing to re­search by RP Data.

Al­most 70 per cent of all dwelling ap­provals in the har­bour city in the year to May were for medium and high­den­sity hous­ing. And Syd­ney is not the only city on the up: Bris­bane and Mel­bourne also saw a swathe of new apart­ment pro­jects ap­proved.

About 27,000 new apart­ments were ap­proved in Syd­ney in the year to May, with a fur­ther 22,000 apart­ments slated for Mel­bourne and 11,000 for Bris­bane, ac­cord­ing to the re­search house.

RP Data’s head of re­search Tim Law­less says the in­creas­ing pop­u­lar­ity of apart­ment liv­ing is be­ing driven by sev­eral fac­tors: the squeeze on hous­ing af­ford­abil­ity; the chang­ing life­styles of the baby boomers; and the dif­fer­ent pref­er­ences of gen­er­a­tion Y.

Hous­ing af­ford­abil­ity is un­der pres­sure across Aus­tralia’s cap­i­tal cities, with Syd­ney’s me­dian house price top­ping $800,000 and Mel­bourne’s soar­ing past $600,000. This means many as­pir­ing buy­ers sim­ply can­not af­ford de­tached hous­ing.

“The ar­eas where hous­ing is af­ford­able are a long way from the cities, where our ma­jor trans­porta­tion net­works and jobs are,” Law­less says. So many buy­ers th­ese days are will­ing to com­pro­mise: “They want to live where they work and play, and they are pre­pared to sac­ri­fice the back yard and the Hills hoist.”

KPMG part­ner Bernard Salt agrees that many Aus­tralians want to live close to “knowl­edge-worker” jobs at an af­ford­able price.

“The only way this can be de­liv­ered is through the greater devel­op­ment of apart­ments,” he says.

Law­less says the chang­ing life­styles of the baby boomers, as they down­size from the fam­ily home, are driv­ing much of the de­mand for apart­ments.

“As they be­come empty-nesters, it’s log­i­cal that they will sell the fam­ily home,” he says. “And the ‘lock it and leave’ con­ve­nience of apart­ment liv­ing ap­peals to their chang­ing pri­or­i­ties”.

Sim­i­larly, gen­er­a­tion Yers, in tak­ing their first steps out of home, want to live close to where they grew up but can’t af­ford de­tached hous­ing in th­ese ar­eas so they, too, are opt­ing for apart­ments.

The other big de­mand driver for apart­ments is prop­erty in­vestors, who tend to pre­fer apart­ments to stand­alone hous­ing as they are eas­ier to rent and of­fer higher yields, Law­less says.

Syd­ney had five of the top-10 re­gions Aus­tralia-wide for unit ap­provals in the 11 months to May 31, RP Data says.

Syd­ney’s apart­ment boom is more ge­o­graph­i­cally di­ver­si­fied than other cities, with around 2000 new units each slated for ar­eas in­clud­ing the in­ner city, Kog­a­rah, Rock­dale and Botany in the city’s south and Chatswood and Lane Cove in the north­ern cor­ri­dor.

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