08/01/2018
The changing age composition of the population over the next decade is expected to change the type of housing demand as Generation Y begins to enter its next stage of life.
But it is proven that this generation will potentially resist the trend of previous generations and live in smaller homes, which could reshape the design of the apartments in the future.
Over the last 15 years, the population aged 20 to 35 has experienced rapid growth, driven both by the Generation Y movement in this age group and by the strong net inflow of migrants abroad, which were also concentrated. in this age group. This has helped support the rise of apartment construction over the last decade by providing a steady stream of new tenants to the market, with a design designed for Generation Y tenants living alone, in couple or without shared household.
But in the next decade, Generation Y will represent the acceleration of growth in households in their late 30s and early 40s. At this point, Generation Y will become more affiliated and enter the family life stage, and many will look to buy a home.
Now, if Generation Y follows the trend of the previous generation while avoiding renting and favoring larger homes at the time of family formation, this will support an explosion in demand for new homes and land in the new decade. subdivisions located on the outskirts of major Australian cities and large regional affordable centers.
But there is strong evidence that people move in the opposite direction and stay longer in smaller dwellings, such as apartments or townhouses.
Take Sydney, where this trend is most apparent: more than half (53%) of newly-born Y-households now between 35 and 39 live in these smaller dwellings. The same is true for almost half (49%) of households where all children are preschoolers.
Households generally preferred row homes as apartments, although in Sydney – and to a lesser extent in Melbourne – the number of apartments taken by both groups has accelerated since the census The trend has been similar, albeit much less pronounced, in Brisbane, Adelaide and Perth.
It is likely that rising house prices and declining financial affordability in the most desired capital cities are causing more and more trade-offs for some couples and families, many buying now smaller and more affordable housing to remain their desired location.
If this compensation activity increases as Generation Y ages, multi-unit housing and new apartments will need to be designed to be more family-friendly, providing more space, both inside and out, or adjacent to life. outdoor public spaces. The smaller homes that meet this need will be in great demand in the future.
Angie Zigomanis
is senior officer of
residential property
market research at
BIS Oxford Economics
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