Apartment living the way of the future?

Hi,

Seems like everywhere I go in Sydney there are massive apartments being build everywhere from the Hills, Northern Beaches and etc. Is this the way for the future for people to live in high rises of 40 levels? I appreciate the fact that this is a necessity to take into account the growing population and people wanting to live closer to accessible healthcare, employment and schools.

I am sad that the great Australian dream of having a backyard is coming to an end and inaccessible for a great number of family. I still remember my childhood of playing backyard cricket.

It's good to see that reforms in the strata by-laws to bring everything up to scratch to cater for modern living.

 

Yep.. i miss growing up with every house having a quarter acre block.
Can't swing a cat in current sized backyards being divided.

 

I think it's the way of the future. It's going to be sad to lose all of the lovely detached houses but the fact is that it's an incredibly inefficient way to build a huge City.

 

Families growing up with big, Aussie backyards are certainly a thing of the past in Sydney.

 

Progress. My son and I enjoy a bit of cricket in the backyard, or front. They'd probably live in apartments when they move out.

 

It is not a good use of land in the CBD (and fringe) to have a 1/4 acre piece of land with one house on it while there is a strong demand
Land is most efficently used when the best and highest use has been applied

 

id rather see the city grow and be dominated by high rises than it not grow and have large houses.

 

As an investor, that's so true. But you want to get in early enough to buy the land!

Also you want that city to keep growing over time, and I can't see Sydney ever becoming undesirable.

 

I hope we see further development in the design of apartments, too, rather than just building square box apartments. There has certainly been progress over the decades, but I think it can be improved further.

I also hope that councils think ahead and make plans for more open spaces so that there are outdoor options for families who end up in apartments. Areas like Central Park in NY are such an amazing resource for the city.

And - especially outside of Syd & Melb - I generally disagree with building apartments without any car parks (or at least to the extent that I see it happening). Perhaps in cities much larger than we have in Australia it works, but I don't believe we are at that level yet.

 

They also need to make public transport better.... instead of sinking money to build tunnels with only 3 lanes each way.

I saw a pic of Harbour bridge dated 1947, even then they had 3 lanes each way!

 

Once the density increases the relative costs for public transport drop substantially.

i.e it's way more cost effective (And wins you more votes!) when you build a train station that services 30000 people than just 3000....

 

Yes.. As long as the land is desirable ie location. Problem is that the empty yet desirable land will be expensive already.

 

I agree
But there would be period homes in inner city that have historical value where you could not develop? which is good, we need to retain some character

 

Going against the grain here but no, I don't think it will be, or at least not in the near future. Unfortunately, many apartments on the market are small, poorly designed and cheaply built - and in some cities there is an awful lot of competition.

Units are currently leading the falls in price growth, to the point where according to AFR some cities (e.g. Brisbane) have 1 in 6 apartments selling at a loss. To add to this, water usage studies in Melbourne have indicated widespread vacancy in investment properties (almost 20% were found to be completely unoccupied long term). This suggests there may be a lot of additional latent supply that could come onto the market quite suddenly if prices stall and capital gains dry up - apartments have been the recent target of an awful lot of inexperienced developers and investors (the types at risk of going broke or selling in a panic). Apartments are cheap, and often they attract buyers and investors on lower incomes, with smaller deposits, smaller buffers, less secure employment and - increasingly - a FOMO driving purchases. Too many have bought indiscriminately, for too much, with too many apartments in the pool.

Currently, there's some very, very loose competition in many suburbs being driven by excess supply. Despite this, if you examine suburbs that have not been the target of a lot of development, most remain competitive. The reason in my humble opinion is that detached, quality homes are usually far more desirable to families. This is the case almost everywhere, including most large global cities, with rare exceptions. I often hear people cite cities like New York as examples of places where everyone lives in apartments - and yes this might be the case for Manhattan, but once you get out to Staten Island, Brooklyn etc it's mostly houses. Very few cities are genuinely dominated by apartments. Families tend to want space. Some apartments can offer this, sure, but most families will sacrifice CBD convenience and amenities for comfort in the long run. This is especially true when a lot of apartments simply aren't built to suit families; people seem to have a tendency to see them as a more temporary living solution - at least in my experience.

Another thing: land is not in short supply. Yes I know "God's not making more of it" but if you look at USA, rural land values have trended down for decades, because there is honestly more than enough of it. In fact the total land area used for agriculture has declined despite a growing population - and despite Australia's aridity, we have a low population here to begin with. We don't have a shortage of farm land that can be repurposed. The modern world has seen a revolution in terms of intensive farming, industrialisation and now we're seeing a rapid rise in telecommuting and and an online task-based economy allowing people to live further and further out without much issue.

Wait a minute, you might think - weren't you going on in another thread about how fringe suburbia is the first thing to go when a bubble bursts? And yes, I was - and am happy to maintain that position. In the short-term of an oversupplied market, people will still want to live closer to the city and will still gladly abandon the recently developed urban fringe to chase the middle class dream. Note though the fringe in Ireland collapsed more because of overstretched developers having to slash prices. In a competitive market, cities expand - often for decades, and old developments give way to new developments closer in. Smaller cities also tend to become larger cities. Rural centres become small cities. Urban sprawl probably isn't going anywhere. I'm not saying it's impossible we'll "run out of room" someday, but I don't think we're anywhere near the point of such overcrowding that we can only to "build up". I also doubt we'll be at that point for many years.

Australia is likely in for an economic contraction soon - we are way overdue. This will probably be associated with a long period of low population growth (it has already almost halved to a two-decade low, peaking way back in 2009). Fewer people want to move here, despite the government "opening the flood gates" - you can encourage immigration, but you still need jobs and a booming economy to really attract people long term. The biggest demographic group in this country is on the brink of retirement, and the population pyramid is about to invert - Australia will have an aging population in just three years. Add in a low birth rate and this country has some serious demographic challenges. We're probably not going to be the "Big Australia" some envisioned, or not for a good long while anyway.

All of these reasons reinforce my idea that quality suburban detached housing is a good bet for long-term growth. Family homes will always be in demand - even if apartment living becomes more popular.

 

I'm thinking HK style... Sydney could become much more like it. You have to be extremely rich to own a house on land there. Sydney won't ever be that extreme, but it will move in that direction. At the moment compared to HK, Sydney freestanding homes are still very affordable. I think Sydney's going to get more expensive as more people continue to fight for lower numbers of well located freestanding homes. Over time, houses get demolished for apartment blocks and higher density living. We still have the demand to cater for the apartments being built.
Most families want to move into homes with land though so they'll always command a premium.

 

Ofcourse
There is a cost
That cost is that the owner will have a chunk of land he cannot get full market value for but another person who has a section with a non historic building will

 

Australia's Population Growth [In the Media]

It was wrote in 2015 so the figures are slightly out of date, but the general message is the same in that Australia is building up. As for the 'Australia has an ageing population argument' isn't that one of the number one reasons that the Government uses to support and implement mass immigration!

The Asianization of Australia? | Australian Human Rights Commission

 

i understand the direction and agree with it.
sydney will be the first to exhibit such market behaviour, then melbourne..and finally brisbane..
and after a few light years..the rest may as well.

 

Perth will overtake Brisbane it's not a question of if, but when!

 

I am at peace with apartment living, mainly because I have lived in one for the last 5 years, but to be fair I do live in a much smaller complex in comparison to the massive high rises coming up these days. I do hope that I can at least be able to live in a townhouse complex which offers some privacy and not too much interaction with people. Imagine every Fri and Sat night you have people upstairs, next to you on both sides and downstairs all having a party till midnight!