11 Sep 2018

As home ownership costs rise and average floor space shrinks, and as Millennials trade off dwelling size for a desirable location, neighbourhood amenity is more important than ever before, says Urbis’ Clinton Ostwald.

National property economics and research director at Urbis, Ostwald says households are changing shape as children remain in the family home for longer, and as more people choose entertainment and travel over a mortgage.

“Residents are also looking for greater connectivity through proximity to public transport and jobs,” Ostwald says.

Household sizes are growing as children remain in the nest for longer. The average household in metropolitan Sydney, for example, increased from 2.7 people in 2011 to 2.8 in 2016. 

Neighbourhood amenity is more important than ever before.

Clinton Ostwald View Profile

The proportion of Australian households in the rental market has also increased from 28 per cent in 2006 to 31 per cent in 2016.

“Compact housing can boost supply and affordability, and provide more choice, but this housing must be located in places where residents can access amenity outside of the home.”

The development industry has responded to the trends in the market with increased flexibility in apartment design. At Frasers Property Australia’s Central Park precinct in urban Sydney, ‘dual key’ apartments – two independent residences under a single strata title – enable multi-generational living or simultaneous home occupancy and investment.

Over at Fairwater in Blacktown, Frasers Property has developed family homes with ‘Fonzie’ apartments – named after the Happy Days character who lived in an apartment over the Cunninghams’ garage. These apartments provide separate dwellings for adult kids or income generation.

Peri Macdonald, Frasers Property’s executive general manager for retail, says shopping centres are starting to serve as the extra living room for compact housing residents.

“A vibrant retail centre provides an extension of people’s living space and fulfils their need for community.” 

Ed.Square in south western Sydney. Image courtesy of Frasers Property.

Centres with food and beverage, entertainment and “experiential” offerings can become “places for people to socialise, relax and spend time as well as shop,” Macdonald adds.

Urbis has found build-to-rent apartments are well-suited to the airspace above shopping centres, and would enable owners to leverage their assets and provide new housing directly connected to the growing amenity in the shopping centre.

Burwood Brickworks in Melbourne. Image courtesy of Frasers Property.

Ostwald says there is “no silver bullet” to housing affordability, but increasing dwelling supply and choice are critical. 

“Shopping centres also have a great opportunity to accommodate residential development and act as the ‘living room’ for residents,” Ostwald concludes.

This article was first published in Property Australia.