next generation home buyers udia wa
Golden Bay by PEET Ltd and DevelopmentWA won the Excellence in Social and Community Infrastructure and the Russel Perry Award for Urban Development Excellence at the 2022 UDIA WA Awards for Excellence.
  • A changing population will require changing housing needs
  • There are "insurmountable hurdles for innovation in housing"
  • Affordability and housing diversity remain key issues

The results of the 2021 Census highlighted a ‘changing of the guard’ in terms of generational divide across Australia with the number of Millennials catching up to the number of Baby Boomers. As this percentage change will only swing more heavily in favour of the younger generations in future Census results, it is important to understand younger generations housing needs now and into the future.

While Millennials are currently trying and in many cases struggling to enter the housing market for the first time, it is the younger Gen Z and Gen Alphas that will be the next first home-owners looking to tackle the market.

In analysing the results of the 2021 census Dr Liz Allen, Demographer at the Centre for Social Research & Methods, The Australian National University said that more Australians have given up on homeownership, not because it’s something no longer wanted but because it is unrealistic and unattainable for too many.

“Housing innovations are being developed by entrepreneurs seeking to find business and social solutions to the housing crisis, but it’s not happening fast enough,” Dr Allen said.

“Government red tape and the inability of banks to think outside the box, appear to be ongoing, insurmountable hurdles for innovation in housing.”

Dr Allen said that declining homeownership, in the absence of greater rent protections, will likely result in increased housing insecurity and in turn drive wealth inequality.

“Intergenerational inequality is a pronounced problem in Australia and further decline in homeownership will only supercharge the unequal prospects young people in Australia face,” she said. “Those with homeowning parents are set for an economic boon once their parents die through the transference of wealth, further compounding socioeconomic fractures.

“Housing security benefits all Australians, directly and indirectly. Australia can no longer afford to deny its housing crisis and the grim future confronting young people.”

In acknowledging that housing and accommodation remained an important asset to younger generations, Lendlease Head of WA Communities and Development, Anthony Rowbottam said the concept of ‘home ownership’ appeared to be less a priority when compared to previous generations (i.e. Gen X and Boomers).

“This changing combination of tenure and availability means that an increased variety of housing types and access models will be required in order to meet the needs of the community going forward,” Mr Rowbottam said. “For example, we are already starting to see these changes in Australia through the increased interest in Build-To-Rent (BTR) schemes.

“I think that demand for traditional style housing product will always remain. The needs of current younger generations will change over time and accordingly, so will their housing needs.

“Economic factors also play a large role in influencing consumer appetite, so it’s important to remember the role that a changing economy has, particularly when it comes to housing.”

Not only will the economy play a role when it comes to future housing needs, Dr Allen points to the barriers to downsizing that are impacting the entire housing market.

“Living standards are going backwards for young people in Australia with declining homeownership a reflection of this,” she said. “Secure housing is essential for well-being and young people are increasingly being faced with tough decisions around having children. Delays in securing secure housing pushes out the window of opportunity for family formation and having children.

“Theoretically, as people age and downsize, housing is freed up for young people and young families. But expectations of this housing mismatch correction isn’t happening in Australia. There are simply too many barriers (financial and social) preventing older people from downsizing. Additionally, houses provide sources of wealth and security, and this is simply something many do not wish to lose.”

What young people want

In considering what future generations will want from the housing market in the coming years, Mr Rowbottam pointed out that technology is a key enabler for modern society with Gen Z and Gen Alpha considering these a ‘mandatory requirement’ not an ‘optional requirement’.

“To cater for these needs, land and housing locations must ensure foundational digital connectivity is available for all citizens,” Mr Rowbottam said. “This includes good mobile site coverage (4G / 5G), good fixed line connectivity to dwellings (e.g. Fibre to the Premises) and good Wi-Fi (public spaces).

“Working form home and remote working is the new normal and future housing will need to provide suitable and adequate space in its design for people to work in.”

To find out direct from our future buyers, The Urbanist spoke to a selection of Gen Z-aged school children.

When asked what they would choose from their dream home, the first response from the group was for a big garden with plenty of space to run around outside but also space in the home for a pool table in a games room.

Other core inclusions on the wish list included an outdoor kitchen, fresh grass, a home office and a second storey to ensure they could fit everything they wanted on shrinking lot sizes.

While there was an air of idealism connected to the youngster’s wish lists, there was a definite sense they might be less inclined to accept a ‘less is more’ mentality.

Similarly, the younger generation had a strong desire for quality social and community infrastructure with more flexible and full-sized sporting facilities on offer. For example, there was a call for more full size netball courts, something that is slightly less prevalent in Perth suburbs, according to our interviewees.

udia wa understanding the next generation of home buyers
There is a strong desire for full size sporting facilities like the options at Picasso Park, Alkimos Vista by Lendlease and DevelopmentWA.

Of particular interest, among the younger generation we spoke to, was the acceptance of a potential need to travel further to get into the city as long as this was supplemented by good public transport links and a good connection to higher activity centres, such as the proposed precinct centres around new METRONET stations.

In a nutshell, affordability and housing diversity remain key issues that must be tackled meaningfully if we are going to meet the needs of future generations, while also considering technology, work from home potential and ensuring our activity centres are well connected to our urban areas.

~~

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.



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