Apartment boom unmatched, but detached homes resurgence coming
Advertisement

Apartment boom unmatched, but detached homes resurgence coming

The Canberra region's apartment boom is moving at a pace unmatched by anywhere else in urban Australia, a new report has revealed, but experts expect the construction of detached houses to ramp up again in the coming years.

Multi-unit dwellings accounted for 35.5 per cent of housing in Canberra and Queanbeyan in 2016, according to the Australian Bureau of Statistics' Progress in Australia Yearbook 2018.

Apartments are changing the skyline across Canberra, including in Belconnen.

Apartments are changing the skyline across Canberra, including in Belconnen.Credit:Barry Anderson

That figure was up from 26.7 per cent in 2006, representing the fastest increase in Australia's major urban areas.

Separate figures, released by the Housing Industry Association last month, show that 78.5 per cent of all dwelling approvals in the ACT in the year to September 2018 were for multi-unit developments.

Advertisement

Housing Industry Association ACT executive director Greg Weller said there had been a lack of land available for detached houses in recent years, while apartment living was more affordable and convenient for many young people.

Apartments also "ticked a lot of boxes" for older people looking to relax in retirement and those with mobility issues, he said, while increasing numbers of migrants were arriving in Canberra from countries where high-density housing was more common and desirable.

But Mr Weller predicted a small resurgence in construction of detached homes, with more land now available and house prices increasing in Canberra despite a national decline.

"I think we'll see, over the next couple of years, a little bit of a shift back to detached home-building," he said.

"There remains a demand for families to live in a detached house, but multi-unit dwellings taking up a larger part of the market than they have traditionally; that's something that's here to stay."

The spring 2018 edition of the Housing Industry Association's outlook report shows that construction started on 3830 multi-unit dwellings in the ACT last financial year.

That number is forecast to drop to 2800 in 2020-21 as the number of detached houses under construction increases, but multi-unit dwellings still account for 62 per cent of predicted commencements that financial year.

"Detached house starts are forecast to rise in each of the years out to 2020-21 and beyond," the Housing Industry Association report says.

"We are forecasting a total of 1710 [detached] houses to commence construction that year, nearly 50 per cent more than what occurred in 2017-18."

Mr Weller said growth in house prices and an increase in the amount of land available were two of the driving forces behind the predicted resurgence of detached homes.

"There have been periods in the ACT where it's been 80 per cent multi-unit [commencements] versus 20 per cent detached homes," he said.

"That wasn't going to last forever and we're pretty much seeing zero growth in apartment prices, but there's been strong growth in house prices."

The Housing Industry Association's report says Sydney and Melbourne have driven the national downturn in house prices, but prices have continued to increase in Canberra.

"In [the] ACT, unit prices have recently recovered to be 8.1 per cent above September 2015 but still 4.3 per cent below their May 2010 peak," the report says.

"Houses though, are still advancing, now 19.7 per cent above their August 2010 peak and 27.6 per cent above July 2014, after which prices started accelerating."

The Australian Bureau of Statistics yearbook also revealed the value of new building approvals in Canberra and Queanbeyan has increased by more than 25 per cent in six years.

New building approvals totalled $2,767,000,000 last financial year, up from $2,207,000,000 in 2011-12.

Blake Foden is a reporter at the Sunday Canberra Times. He has worked as a journalist in Australia, New Zealand and the UK.

Most Viewed in National

Loading
Advertisement