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Australian Property Market – Buyers Have the ‘Backyard Blues’
June 29, 2012
A definite shift towards apartment living is apparent in Australia’s current property landscape. However, many buyers still value having a private bit of ‘green’ around their property, with some families willing to spend up to $75,000 more to have a garden. With land values increasing in inner urban zones, outdoor spaces are decreasing and the modern preference – even in outer suburban ‘new’ estates – is to go low maintenance and build to the boundaries. So when it comes to apartment living versus detached housing, what exactly are buyers looking for?
A Shift towards Apartment Living for Some
Affordability is the key word. There is a definite shift towards apartment buying. Across the country, the cost of detached housing in inner city suburbs has increased substantially due to rising land values and population growth. Therefore, many home buyers are restricted to the apartment market if they want to remain in inner suburban localities. This, coupled with increasing numbers of single person households, and the persistent desire to live in the inner urban localities, all equates to a ‘new Australian dream’ no longer founded in a detached dwelling.
Investors also tend to prefer apartments because they represent low maintenance ‘set and forget’ acquisitions with property managers and owners corporations responsible for the smooth operation of the block. Recent median price figures for all states show that drops are primarily in the detached housing sector, with more resilience shown in the apartment sector.
Despite this, most ‘family’ home buyers prefer having a garden and will pay more for the luxury. Although the single person household is the fastest growing in Australia, family buyers still outstrip single home buyers. They also tend to purchase with a longer time-frame in mind – often buying to be within a school zone or at least settle until the children grow older. Therefore, detached housing is generally held for longer periods of time than the apartment market.
The Value of a Garden
One of the benefits of increased density (it’s argued) has been the notion that it reduces pollution from people commuting across town to access jobs and other facilities. However there’s little evidence to support this, although living closer to the city may encourage increased use of public transport, our car dependent life styles and inefficient public transport systems, ensure traffic congestion and urban pollution continue to rise.
Living in a city is dynamic, convenient, exciting and yet without a balance – the pace of inner city life is exhausting, polluting, frustrating and draining. The health benefits that can be obtained from a private garden –socially, physically, and mentally – would be too numerous to list.
A house in the suburbs with an ample backyard for the kids is the foundation of what was once called the great Australian Dream. In fact, the quarter acre block which eventually became the eighth of an acre block, was a great ecologically friendly model and it all came down to the backyard. Considering our modern push to look after the environment, it’s surprising a decent sized back yard does not feature higher on the priority list with planning authorities, who tend to allow housing in new suburban estates to take up larger footprints leaving no more than a walkway of paved private outdoor space.
What is the Better Investment?
As with all markets, the Australian housing market is fragmented. Although apartment values may be robust in inner city localities, if purchasing in an outer suburb or school zone, the major buyer demographic is likely represented by the ‘family’ home buyer looking for a detached dwelling. It’s important therefore to purchase for the major buyer demographic when considering investment if you want to capitalise on returns.
Unless buying ‘new’, detached housing is likely to have higher maintenance costs for which the individual owner is responsible. However, apartments generally have professionally run owners corporations which administer maintenance issues. Obviously, apartments are smaller than houses; therefore maintenance costs will generally be lower.
A Greener Future
Whilst there is no doubt the push towards urban consolidation is an inevitable consequence of our population growth and changing cultural shift, we’re certainly not healthier for it – and many would argue that neither are we happier for it. First home buyers have increasingly limited choices when it comes to housing options.
It is down to our urban planners to ensure we don’t lose the joy of an area of ‘green lawn’ all together. Australia has an abundance of land for everyone to spread out and enjoy the joys of nature if only more effort and expense was dedicated to the development of industry, transport arterials, and growth in the smaller ‘satellite’ cities and regional centers. As it stands at present, we’re losing a part of Australian culture that cultivated an ingrown appreciation of ‘the land.’