Census reveals Australian dwelling shift

July 7, 2017 / By  

The 2016 Australian census reaffirmed and also questioned some widely discussed trends within Australia’s residential markets. These trends illustrate Australia’s changing way of life and are reflective of its rapid population growth and increasing urbanisation.

1.  Australia is moving away from the traditional stand-alone house

Nationally, the portion of households living in stand-alone houses decreased between 2011[1] and 2016 from 74 to 72 per cent. As shown in Table 1, this trend was amplified in Sydney and Melbourne. In Sydney, growth in apartments over the Census period was particularly strong, with the proportion of apartments rising from 27 per cent in 2011 to 29 per cent in 2016, approaching almost one-third of all dwellings.

Table 1: Changes in weighting towards dwelling structures
Table 1 - 7 Jul 2017
Source: JLL Research, ABS Census Data

However across Australia and in Melbourne, the proportion of apartments stayed approximately the same in this timeframe. In Melbourne, it was semi-detached, row dwellings and townhouses that experienced strong growth, with the proportion of this format growing from 12 per cent in 2011 to 17 per cent in 2016. It is clear that both cities are moving towards more dense housing however differences in topography and planning features has caused dwelling structure types to diverge.

2. Home ownership remains relatively stable nationally – but not in major cities

An undoubtedly contentious topic in Australia is housing affordability. Nationwide, between 2011 and 2016 the proportion of owner-occupier households marginally declined from approximately 68 to 67 per cent. Furthermore, there has been almost no change in the amount of owner-occupier households with a mortgage.

With that being said, ownership has decreased in Australia’s two major cities. Owner-occupier households in Sydney declined from 71 to 68 per cent, and from 67 to 64 per cent in Melbourne over this period.  This has coincided with high house price growth of 53 per cent and 24 per cent[2] in Sydney and Melbourne respectively between the two censuses.

3. The apartment demographic is widening – a lifestyle shift?

Previous censuses showed apartments being dominated by a transient population – young adult renters living alone. However, countrywide, the proportion of family households grew from 45 to 48 per cent between 2011 and 2016. This also occurred in Sydney which experienced a 24 per cent increase in family households living in apartments.

Interestingly, in Melbourne the proportion of family households remained the same. This is likely attributable to differences in housing affordability between the two cities as highlighted in Table 2. While prices have grown in both cities, repaying a mortgage has remained more difficult for the average earner in Sydney. This is likely a key factor that has pushed many families into more affordable apartments in order to remain close to good education and employment. This demonstrates that living close to good amenities is perhaps being valued over the traditional “quarter-acre block”.

Table 2: Percentage of average income required to service a mortgage
on a house at the median price
Table 2 - 7 Jul 2017
Source: JLL Research, ABS Annual Earnings Data, CoreLogic

These changes provide confirmation that the anticipated shift away from the traditional “Australian Dream” of owning a house with a backyard is occurring. Our policy makers will need to be mindful of these trends, maintaining focus on amenity and infrastructure to support growing population in our cities.

[1] CoreLogic Sep 2011 and Sep 2016 annual median house prices
[2] Date of the previous Australian census

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