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“At first, we were thrilled about the borrowing amount, thinking it would get us something worthwhile,” shares Billy. “But now, as we start searching, it’s turning into a ‘what’s going on?’ moment.”
Terry Rawnsley, an urban economist at KPMG, highlights a noticeable trend in the post-COVID-19 era: transitioning from an apartment to a house has become increasingly challenging.
This difficulty stems from the fact that house prices have surged at a significantly higher rate than those of units.
In almost every capital city, except Darwin, the gap between the median price of units or townhouses and that of houses is widening. Source: SBS News
In Sydney, for instance, the median price for a house has soared to $1.7 million, as reported by Domain.
The difference in price between the median unit/townhouse, and the median house, is growing in every capital city except Darwin. Source: SBS News
In Sydney, the median house price is now $1.7 million, according to Domain.
“I think there is a lack of diversity in housing options available at the various price points.”
‘Hoping for a Christmas miracle’
Billy, 37, and his wife believe they’ve likely reached the peak of their earning potential and say it’s been disappointing to see what they can actually afford to buy in the North Shore, where they would like to stay because it’s close to their family.
We’re getting priced out very easily, especially for things that fit our criteria, which is something that’s livable [and] in a decent location.
“We may have to live in something a bit more cramped and maybe save and try and do renovations in the future.”
His wife’s parents helped her to buy the property and Billy says the pair don’t feel like it’s an option to ask their families for more assistance.
Out of a matter of pride and self-respect, I guess, because we know we’ve already gotten help, it doesn’t feel right to ask or continually ask for more help until we’ve given back a little bit.
“If there’s any time for a miracle to happen, it’s normally around Christmas time because people go away on holiday [and] there’s not a lot of interest then.”
Supply of three-bedroom properties is falling
There are now more properties with four or more bedrooms (2.8 million homes) than with three bedrooms (2.6 million homes).
The proportion of three-bedroom dwellings declined in the 10 years between 2011 and 2021. Source: SBS News
The emphasis on building higher-density apartment blocks with one or two-bedroom dwellings, as well as larger homes on the urban fringe, appears to be depleting the proportion of three-bedroom properties available.
Australian Housing and Urban Research Institute managing director Michael Fotheringham points out that Australia builds many more houses than apartments, and these are mostly concentrated on the urban fringes.
For each individual apartment, we build six houses and that continues.
Developers shifting focus
But he says the group’s research has found a spike in people saying they are interested in three-bedroom units in Sydney suburbs such as Gladesville and Crows Nest, and even Newcastle in NSW.
We’ve definitely seen that on the ground, that people are wanting larger units now because they’re being priced out of the traditional home market.
James Alexander-Hatziplis, the chief executive officer of Sydney architecture firm Place Studio, says he has noticed a real shift in the market.
Third.i’s Crows Nest development Hume Place is expected to include more three-bedroom apartments suitable for family living. Source: Supplied
“Developers are starting to focus on apartments that work for a wider mix of people, not just first-home buyers or downsizers,” he says.
“This is, at its core, a more sustainable outcome as it reduces the need to replace redundant housing that doesn’t meet society’s needs.”
Push for more family-sized homes
She stresses that governments should be encouraging developers to build more three-bedroom apartments because they give families and downsizers the ability to stay close to jobs, schools and transport, rather than pushing them to the fringe.
“This will encourage development of a wider variety of homes suitable for families, including three-bedroom homes,” the spokesperson says.
One of the designs from the NSW Housing Pattern Book that can be used to construct two side-by-side homes with two to four bedrooms each. Source: Supplied / Sibling Architecture
The pattern book provides high-quality home designs for low and mid-rise housing that can be fast-tracked through planning processes. It includes terraces, row homes and mid-rise apartments.
“That is why clearer guidance, incentives and design standards at the state level still matter.”
Relief could still be a few years away
It’s hoped the supply of townhouses, terraces and other mid-rise apartments will provide another rung on the property ladder that’s more affordable than a standalone house.
“There’s always been compromise in the property ladder but now some of the compromises between budget, locale and size are really not practical for people to make.”
