With ever shrinking household sizes, a rapidly expanding population, an ongoing critical housing shortage and affordability issues all plaguing Australian property markets, there’s no denying that we require more accommodation and quickly.
Not just any type of accommodation will do however.
With more young people opting to live in our inner cities and state governments implementing urban growth boundaries in an effort to curb outer suburban sprawl, it seems the answer lies in higher density accommodation, namely one bedroom apartment style complexes.
As an investor, you have a distinct advantage if you can see where housing trends are heading into the future, particularly given that property investment is a long term endeavour.
Picking the next big suburb can be tricky and fraught with danger, but tracking household and lifestyle trends is much easier and can provide some great insights into the type of property you should be considering for your portfolio.
In the past, Australians traditionally shied away from one bedroom apartments in favour of large homes on big blocks of land.
Times are changing though, as is evident from recent data released by the Australian Bureau of Statistics that predicts an increase in the number of single person households of 1.7 million over the next 20 years.
The ABS also expects that couples without children are set to outnumber the typical “nuclear family” by 2031.
Taj Singh, from First Home Buyers Australia, says there are several advantages to holding out for another bedroom.
Two-bedders offered greater resale value in the future, especially as lenders were less willing to lend on smaller apartments – particularly those under 50 square metres.
“Especially with the rise of Airbnb, it’s important from a rental perspective to think about that second bedroom,” he says “That second bedroom will get a much better yield.” It can also serve as a home office.
“People are not trading homes as much as they used to – it’s a lot harder to get into the market, and you buy into an area for a reason whether it be transport or schools,” Bainey says,pointing out that the extra flexibility could allow buyers to stay in their desired area longer.
And with newer apartments in particular, a two-bedroom unit is more likely to come with a second bathroom.