Contrary to general perception, Sydney residents are showing a marked predilection for residential property in high density areas.
A new report by property industry group Urban Taskforce Australia has found that there is a direct correlation between the average price of apartments in different parts of Sydney and their levels of population density.
Urban Taskforce first identified the areas of Sydney with the highest levels of housing density using mapping data made available by the Australian Bureau of Statistics, and compared their average apartment prices with those of nearby areas with lower levels of density.
Their analysis found that the sales price of apartments rises in tandem with levels of housing density, and that even suburbs in close proximity are affected by this trend.
In Potts Point, where population density is over 8,000 people per square kilometre, the average sales price in recent years has run as high as $11,173 per square metre, while in Edgecliff, where the population density is between 5,000 and 8,000 people per square kilometre, the price is far lower at $8,326 per square metre.
Another example is price differences between Chatswood and Lindfield. While the average apartment sales price in tightly packed Chatswood is $8,997 per square metre, in nearby Lindfield, which is less densely populated, the price is $6,415 per square metre.
According to Urban Taskforce CEO Chris Johnson, this trend reveals an increasing predilection amongst Sydneysiders for housing in higher density areas as a result of the lifestyle conveniences that this brings.
“The market is showing a clear preference for apartment living in taller towers in denser urban areas,” said Johnson. “The reasons for this are likely to be the greater number of amenities that are close by in more dense areas. These precincts often include restaurants, cafes, gymnasiums, health clinics, cinemas, theatres and jobs close by.”
The gap in prices between Chatswood and Lindfield embodies this lifestyle disparity, with the former area host to larger cinemas and shopping complexes as well as a biggest transport hub.
Johnson points out that demonstrable preference amongst Sydney resident for high-density housing runs against the grain of popular perception.
“There has been a perception by some in the community that apartment towers are generally of lower value than mid-rise apartments but the research data is telling a different story,” he said.
The preference for high density housing is far from confined to Sydney’s inner city or shoreline suburbs. In Western Sydney, the trend remains consistent, with the average apartment price of $5,938 in Parramatta, where population density is between 5,000 to 8,000 people per square kilometre, higher than the Westmead average of $4,789 per square kilometre, where population density is under 5,000 people per square kilometre.
This trend could be a big part of the reason why Sydney has emerged as far an away Australia’s most densely packed city. The NSW capital is host to 21 square kilometres of area with population densities in excess of 8,000 people per square kilometres.
Melbourne is host to only one square kilometre of area with this level of population density, which is absent from all of Australia’s other major cities.