How future trends will change the Aussie property market
Changing demographics in Australia will see a shift in the demand for property.
According to research by Commonwealth Bank, a swelling population and growing urbanisation will change the property market over the coming 15 years. In the first of the bank’s Future Home Insights Series, Commonwealth Bank has predicted Australia’s growing population will see demand for housing swell. The bank said approximately 30 million people will live in Australia by 2030.
“That’s up from approximately 24 million today. Industry research estimates another 2.7 million homes are needed over the next 15 years to accommodate the population. An increasing population is one factor which can put upward pressure on house prices, therefore it is important new construction activity keeps pace with population growth,” the bank said.
Also driving house price growth will be Australia’s high rate of urbanisation. According to the report, 89% of Australians live in metropolitan area, putting Australia ahead of the United States, United Kingdom and China.
“The urbanisation rate has a significant impact on residential property value. High demand for metropolitan living drives prices up in our cities, which means that housing in regional areas is often more affordable by comparison,” CBA said.
Urban density is predicted to also drive demand for apartments, the bank said. The report said half of dwelling investment was occurring in the multi-unit segment.
An ageing population could also change the types of property in high demand, the report said, with one in five Australians over the age of 65 by 2030.
“An ageing population may fuel demand for accommodation that can enable a stimulating lifestyle. Factors such as easy access to quality health care, public transport and safety, will influence housing demand and supply.”