If the Size is Right

Cast your mind back thirty years to 1990 when WA’s
population was at 1.613 million people. Nowadays, we’re at 2.72 million, a not
insignificant 68.6 per cent increase.

With such growth, one would reasonably expect the creation
of new suburbs (think Alkimos, Bertram, Piara Waters, Haynes, Secret Harbour to
name a few) and plenty more homes built not only in these emerging regions but
more infill developments in established metro suburbs, to significantly add to
Perth’s overall housing stock. There are fewer of us living in the same home
nowadays too but even if this had stayed constant, it’s reasonable to assume
we’ve got about another million homes to choose from.

It is therefore astonishing that in 1990 there were 37,444
sales recorded across WA. Last year, there was 38,405. In 2018 there was only
40,957. In fact, each year for the past five years, despite our significantly
larger population, the amount of sales activity has been below the ten year
average of 52,002. By contrast, WA recorded 88,791 transactions in 2005, the highest volume of
sales over the past thirty years.

Land sales have been hardest hit with only 5,685 vacant lots
sold in 2019, less than half the ten year annual average of 11,923. Government
lead first home buyer stimuli in 2006 saw land sales hit 23,093 in that year
alone on top of another 22,571 lots sold the year before.

Established houses and apartment sales have also fallen
albeit less dramatically.

Land sale volumes are likely to increase along with the
broader market although given our collective proclivity towards lower
maintenance, lock and leave housing, it is less surprising that the market
recovery is coming from the mid to higher priced property bracket as opposed to
the more affordable end (such as that found in the outer suburbs) of the
market.

Real Estate multi-national, Knight Frank, recently released
a report into buyer behaviours around “rightsizing”. Apparently, buyers no
longer “downsize”, they “rightsize” because it is becoming more common that the
size and proportion of the accommodation in demand from downsizers is
comparable to the larger family sized homes they’re typically leaving.

According to the report, rightsizers come from all
demographics, not just cashed-up baby boomers and retirees and they are
demanding smaller or no yards, good security, proximity to shopping and
entertainment hubs and large living areas.

These rightsizers are looking for generous apartments in
neighbourhoods where they already live. The report also found that the largest
growth in three or more bedroom apartment demand is coming from Perth’s medium
density projects up from 27 to 50 per cent of all new developments.

The way we want to live is changing. Demand for high
quality, low maintenance, sustainably built, large homes on small lots or part
of a mid-rise apartment group is increasing at the expense of bland, single
level detached housing in the far edges of our cities.