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The Rise of Medium Density Housing


The trends in property and housing in Sydney have drastically changed in the past 5 years. One of the most evident changes is the growth in medium density housing. Known as “The Missing Middle”, the NSW Department of Planning and Environment has recently committed to facilitating faster housing approvals through The Medium Density Housing Code, which will take effect on 6th July 2018. This code will allow fast track complying development approval for dual occupancies, manor homes and terraces.

Medium density housing includes townhouses, terraces, duplexes, manor homes and apartments. Over the last 25 years, the share of detached homes in the city has fallen from 68% to 55% with the NSW Government estimating that 75% of local residents now live in apartment buildings.

Why Medium Density Housing Is On The Rise

Population growth

According to industry sources, Greater Sydney is set to grow more than 1.5 million people in just over 20 years from 5.07 million in 2017 to 6.62 million people in 2040. Growth in population naturally increases the demand for housing and housing options. Not only is the population increasing but the average household size is also projected to fall, resulting in the need to create additional occupancies to cater for this trend.

This challenge coupled with the lifestyle benefits of living close of the city, or booming areas such as the Parramatta CBD, has increased demand with a limited supply of land. Medium housing options are ideal for growing populations as they require less land, can house a greater number of residents in the same block of land and are more sustainable.

Shifts in attitude

Freestanding houses were once considered “The Australian Dream” but there has since been a shift in attitude due to lifestyle trends. Medium density housing options such as apartments are largely built in areas that have access to transport services, popular restaurants, public amenities and employment. These driving factors are significantly different as we progress with time, with trends as such being evident now more than ever. This also means that as a population, our preferences are changing and must be embraced.

Need for more affordable housing

Due to the sharp increase in property prices in the past few years, the purchasing of a free-standing or detached house has become more difficult and often out of reach for many. Homes that are affordable tend to be further away from employment, services and major infrastructure. It is important to provide alternative and more affordable housing options for medium household incomes. The primary way to encourage adequate supply of additional housing is to meet the demand.

Putting an emphasis on medium density housing can achieve an efficient use of existing urban spaces by providing flexible and affordable housing options as they require less land and area. Medium density housing can improve urban amenity, stimulate local economies and deliver energy efficient homes through the reduction of materials required.

With amendments rolling out in mid-2018, the Australian property market continues to remain desirable and present opportunities for our population. Stay up to date with the latest news from Cite Group.