Housing choice is the key to accommodating the modern first home buyer, according to industry experts.
There has been an evolution in the housing needs of this critical portion of the market, due to changing demographics, as well as economic circumstances that are making it harder to get a foot on the property ladder.
Data from the Australian Bureau of Statistics (ABS), the 2021 Census and AHURI all reflect how the first home buyer demographic is changing. The average age of modern first home buyers is around 32 and they tend to have an average household size of 3.2 persons, meaning what they are looking for now is very different to historic needs.
Stats from the ABS also suggest first home buyers will look to buy more affordable homes but they will be spending a larger share of their household income on housing, compared to changeover buyers.
The recent interest rate rises, along with rising rental values and tight supply have also made it challenging for buyers to save enough to enter the market.
All these factors mean that a diversity of housing choices at the affordable end of the market is required.
“We’re seeing first home buyers look for quality homes in highly liveable communities that are well-connected to transport links, employment, and shops; the integration of essential services like childcare, doctors, and schools; and open spaces for families and friends to gather and stay happy, healthy, and active,” Stockland Project Director Andrew Wallis said.
“Inner city locations, like Stockland Canopy in Glendalough, are proving popular with first-home buyers. The two- and three-bedroom townhomes in the community are ideal options for first-home buyers as there’s easy access to Perth’s CBD just five kilometres away, it’s close to local shops and schools, and provides a good balance between inner city living and green space.”
Well-regarded developer Satterley is also adapting to the changing needs and wants of first-home buyers by providing different options and lot configurations in a variety of locations.
“One such example of this is the allocation of an apartment site in Eden Beach in the northern coastal corridor,” Satterley Chief Executive Nigel Satterley said.
“Another example is the built-form options available within Myella and Gallery.”
“We are also reimagining lot configurations in our greenfield developments to meet the need for affordability with smaller lot options, grouped housing sites and high-density builds near key amenities,” Mr Satterley said.
Keystart Chief Operating Officer Lindsay O’Sullivan advises that while the demographic of first home buyers might be changing, ultimately they are simply looking for the opportunity to get into the market, as well as value for money.
Mr O’Sullivan said that value for money does mean different things to different people, but ultimately first home buyers will likely need to compromise to get into the market.
“The old adage is location, location, location,” he said.
“Where buyers choose to live will drive what type of housing they can afford and what inclusions they will be able to have as well.
“The important thing for developers to keep in mind is making sure people have choice when it comes to location, the housing typology and key features.”
Delivering housing diversity
Given the demand for housing choice in the first home buyer market, the need to diversify WA’s housing stock is critical.
Mr Wallis said the impacts of COVID-19 have accelerated some change, particularly in relation to construction methods which are more sustainable, can be more affordable and offer different housing options.
“Stockland has been exploring modern methods of construction with our building partners, using quality alternative materials like timber and steel frames which has allowed us to make serious inroads into emissions reduction for concrete and cement,” he said. “It’s not just what we want, but also what our customers expect in new homes.
“We have a pipeline of over 280 townhomes set to be built across Perth. These options provide customers the choice between apartment living and detached housing and, when done at scale, is a great opportunity for those looking to buy in WA.”
Mr Satterley said he had also noticed a distinct change in product typology within greenfield estates.
“Blocks are getting smaller to meet the need for affordability, and we are seeing more high-density housing allocations in proximity to key amenities such as public transport, parks, schools, and medical centres,” Mr Satterley said.
While Mr O’Sullivan acknowledged the challenges facing developers in delivering medium and high-density products in WA, he believes that this type of housing will become more prevalent in the market over time. That is why Keystart is preparing new home loan products to assist buyers looking for medium and higher-density options.
“We’ve got a new product called Urban Connect which is available for medium and high-density apartments,” Mr O’Sullivan said. “It’s got higher limits so there’s that opportunity for people to be able to access those products.
“We’re also going to be launching a new product in the next few months that helps buyers to fund the developer deposits if you’re buying off the plan for example. This new product will allow us to fund the pre-sale deposit on behalf of the customer which will be good for developers and good for customers.”
This story was originally published in The Urbanist magazine, an official publication of the Urban Development Institute of Australia (WA). It has been edited for republication by The Property Tribune.
The Property Tribune thanks the UDIA WA for the opportunity to republish the work, and share thought leadership in relation to urban development and community creation with our readers.
Read the original copy of The Urbanist by heading to UDIA WA’s website under the News tab.