Terry’s View - Demand Shifts To Units

Demand for attached dwellings is sweeping Australia, with most of the nation’s capital cities and many key regional centres experiencing surging buyer demand for units.

Two major reports published recently by Hotspotting - “The new paradigm in real estate: the rise and rise of apartments” produced in association with Nuestar and the Spring edition of “The Price Predictor Index” - have both highlighted the dramatic rise in market-share by units.

In the Greater Sydney market, for example, the market-share of units in total residential sales has risen from 48% three years ago to 54% now.

We have also charted a major shift in buyer activity in Perth. As houses become increasingly expensive, growing numbers of purchasers opt for well-located units.

Demand for units has also seen significant growth in Melbourne, Brisbane, Canberra, and key regional cities like the Sunshine Coast and the Gold Coast.

The growing popularity of attached dwellings is driven by lifestyle factors as well as by the relative affordability of units over houses in the same area.

As “The new paradigm” report published with Nuestar shows, the old paradigm of houses on land outperforming units on capital growth no longer stands up to scrutiny. Now units are competing strongly on price growth, as well as lower buy-in prices and better rental yields.