This article is from the Australian Property Journal archive
KEY workers such as nurses and teachers are best-placed to benefit from governments unlocking the “missing middle” in Australia’s housing market, which could see more than three million strata units delivered across the capital cities – and at a faster clip than higher-density housing being pushed forward by state governments.
A new report from CoreLogic and Archistar, The Missing Middle: The Greatest Opportunity for Medium-Density Development, assessed the development potential of capital city land that doesn’t currently have a strata development and where local regulations allow for higher density dwellings.
Some 1.3 million sites were identified across the country. The largest number of sites by capital city were in Melbourne, with more than 472,000 lots and the potential to deliver almost 1.2 million new strata units, followed by Sydney with just under 351,000 sites and the potential for more than 934,000 new units to be built.
The research identifies an avenue for sorely-needed housing supply amid a national housing crisis, which has seen affordability stretched to its worst levels on record, crushing vacancy rates and high rents.
The remarkable figure of three million units was produced by analysis that even excludes high-rise and mixed-use opportunities, with the average number of potential units per site at just 2.5.
The analysis shows 57% are within two kilometres of an existing train station.
“This is introducing variety and diversity into housing,” Archistar co-founder Benjamin Coorey told Australian Property Journal.
“If you think about repurposing single-family houses into duplexes or triplexes, the houses are slightly smaller, but you can start to populate them around train stations and around transport.
“It’d be really good for key workers and industry that needs to be near hospitals and needs to be near schools.
“And you’re not looking for a large house, but you just want something close to where you work.”
An Aware Super report last year found that a chronic shortage of affordable housing for essential workers near their jobs in Australia’s capital cities is costing the nation $64 billion.
The NSW government is currently working on its the Transport Oriented Development program which will see zoning changes within 400 metres of around 39 train stations allowing for higher-density housing close to public transport, shops and services, while the Victorian government last month unveiled plans for 50 new train and tram zone activity centres with a similar approach to housing.
“I definitely think that’s required, but I don’t think there’s a single silver bullet here. You need a multi-step approach,” Coorey told Australian Property Journal, noting that delivery time could be faster for lower-density housing.
Of the three million potential units identified in the report, almost 500,000 are situated on “low complexity” sites that don’t offer imposts such as a material slope, heritage rules or the risk of a hazard such as bushfire or flooding.
“This is really focused on that missing middle. And if we look at what we’re showing in this report, these are on individual properties. There’s low complexity. It’s stuff that can get out a lot quicker than approving an apartment block.
“A lot of it is still around feasibility and getting that to work. So identifying these opportunities, looking at what’s out there and just getting that feasibility right, that’s probably going to be the trick to unblocking this supply.”
Construction costs are expected to remain “stubbornly” elevated until at least 2027, according to a new WT report.
Across the local government areas, Brisbane City Council stands out with the highest potential given its larger land area, with 179,286 potential units over 50,419 sites.
Next was the Mornington Peninsula Shire, on the edge of Melbourne (98,378 units and 31,629 sites), Wyndham City in Melbourne’s west (97,653 and 43,989). According to the report, nearly two-thirds of sites (63%) showed a low complexity score and nearly half (45%) of the potential units were within two kilometres of a train station, “making this council region a strong candidate for strata infill”.
Moreton Bay City was next. On the list (91,270 and 41,498), and Hume City in northern Melbourne was also above 90,000.
Canterbury-Bankstown led Sydney (87,886 from 15,008). While only 11.1% of these showed a low complexity score, the Canterbury-Bankstown region recorded the highest number of strata units that could potentially be built with a low complexity score (10,139) of any Greater Sydney LGA.
The City of Salisbury led Adelaide, the City of Stirling led Perth, Glenorchy Council topped Hobart and the Municipality of Darwin had the largest potential in the top-end capital.
