Forget the house with a backyard, it seems Aussies are preferring unit blocks with gyms and pools, that are closer to trendy cafe strips and the city centre.
Victoria is expected to build for the first time ever more multi-unit dwellings than detached houses next year, joining Sydney which has been regularly doing that since the 1990s, according to research from the Commonwealth Bank.
Senior economist Michael Workman said it isn’t just higher population growth and higher land prices that are driving the migration to high rise apartments
“The proximity to the city offers distinct travel advantages along with a preference shift to apartment and high rise life styles,” he said.
According to data compiled by Mr Workman, Victoria is expected to build 33,000 multi-unit dwellings, which also includes townhouses, in 2016 – dwarfing the 32,000 detached houses that are in the works.
The Victorian government’s policy to exempt off-the-plan purchases from stamp duty and the federal government easing restrictions for overseas buyers have also been big drivers for the change.
Mr Workman said people buying units before they are built also significantly reduces the financial risk for developers looking to build.
Senior economist for online property website Domain, Andrew Wilson, said while affordability has always been a key issue for where people live, proximity to work, public transport and other facilities are also significant attractions for choosing to buy a flat.
“There’s also no doubt that there’s a lifestyle preference for the smaller living spaces, particularly for first home buyers,” he said.
“There’s a different sense of community within an apartment building. Developers now provide things like gyms and swimming pools, there’s a lot of internal recreational facilities, I think also a preference, particularly among female buyers, for more security.”
Mr Wilson said reduced maintenance issues, when it comes the looking after the building, lawns and gardens are making unit blocks more attractive to owner occupiers, as well as investors.
“There is a lifestyle factor pushing the search for apartment living beyond the normal drivers of affordability, amenity and proximity,” he said.
VICTORIA TURNS TO HIGH-RISE LIVING
- 33,000 multi-unit dwellings to be built in 2016
- 32,000 detached homes expected
- Multi-unit annual approvals hit a record 35,000 in July
- Nearly half of all multi-units will be built within 12km of Melbourne’s CBD.