The Sydney-based multinational bank’s Future Home Insights Series identified a number of trends that are predicted to significantly influence the Aussie housing market from now until 2030.
Identified trends include population growth, urban living trends, and the rise of multi-unit dwelling construction.
“We know these trends will significantly impact how Australians live, buy and sell property. At the same time, these trends could change how lenders meet the needs of Australian home buyers in the future,” said Dan Huggins, executive general manager home buying at Commonwealth Bank.
Some of the nine existing and emerging pathways to homeownership are highlighted here:
Co-living arrangements are set to become more sophisticated with the emergence of collaborative buying/living models. “Co-housers” typically own or rent smaller-sized dwellings that are part of much larger developments. These larger developments will have communal areas, such as storage areas and laundry rooms. Consequentially, each house can be smaller and more affordable.
Co-housing also reduces the physical and environmental footprint per household through more efficient land use.
With house prices continuing to rise in many markets, a growing number of people are splitting the cost of buying a home by partnering with a sibling or friend and sharing mortgage repayments. Analysis by CommBank shows that the number of applications with two or more applicants is growing, from 64% in 2014 to 67% in 2016. In contrast, the number of single applications for mortgages is slowly declining.
Communities in common
By 2030, new dwellings in Australia will average a mere 119 square metres in size, which is about half the size of the average home today. To compensate for these smaller private living spaces, developers and architects are designing communities that encourage people to share common areas.
“Communities in Common also occur when individuals formally band together because they share certain values and lifestyles.”
Joint-ventures and syndicates
Increasingly, groups of people—such as siblings, friends, and cousins—are banding together to enter the property market as a group. Group development models, in which people buy and develop blocks of land collectively, also delivers economy of scale.
Guarantor loans are now widely utilised by parents who want to help their adult children enter the property market. “These loans help young people get into the housing market sooner by allowing parents or family members to use their own property as additional security.”
Online crowd housing platforms are connecting homebuyers who share common interests with property developers and architects. This gives people more say in the kinds of homes they’d like to see built.
“For buyers, it means they’re able to express their needs to property developers in real-time; and for developers, it means reducing settlement risk by creating more attractive apartments that specifically meet the needs of buyers.”