Is Your Home the Right Size? The Growing Trend Putting Pressure on Australia’s Housing Supply
Is your current home the right fit for your lifestyle – or are you struggling to find a place that truly meets your needs?
For many Australians, “rightsizing” has become the answer, as they search for homes that better align with their stage of life and evolving personal needs.
However, in the pursuit of finding the “just right” space, Australians are finding themselves in competition, especially as downsizing Boomers and upsizing families target the same type of properties in desirable locations.
With limited supply, this push for right-sized living is driving new pressure on Australia’s housing market.
Temple & Webster, recently released research exploring this growing trend.
Their report, Finding the Right Fit: The Future of Rightsizing in Australian Housing, reveals the housing challenges Australians face today.
The findings show that while more people are prioritising homes that suit their lifestyle and budget, supply hasn’t kept pace with demand for flexible, functional spaces, and the mismatch is creating friction across demographics.
Key findings from the rightsizing report
Temple & Webster’s study highlights several insights that capture the rightsizing trend and its impact:
- Australians are on the move: Nearly one in four Australians plans to move within the next two years, and among renters, that number is even higher (one-third). This mobility points to a shift in priorities, as more people actively seek homes that fit their lifestyle.
- Rightsizing is a leading motivation: The desire to rightsize is the primary reason for this mobility, with 67% of respondents citing it as their main motivation. People without spare rooms want more space, while those with excess rooms look to downsize, resulting in high demand for mid-sized, flexible properties.
- Supply doesn’t match demand: While Australians want a better fit, suitable housing remains in short supply. A lack of outdoor areas (67%) and limited internal living spaces (46%) have become major concerns for those looking to move, making it difficult for people to find the homes they want.
- Older Australians face unique challenges: The over-55 demographic is particularly affected. They often seek housing that is accessible, practical, and close to essential services but face limited options. Having a lock-up garage, for instance, remains a top priority for Australians aged 55-74, yet the supply of these types of dwellings is limited.
- Apartments offer a mixed bag: While affordability drives interest in apartments, with 61% of Australians aged 25-54 willing to consider apartment living, their lack of outdoor and internal space holds them back. Apartments still offer potential, though, with 60% of apartment residents valuing access to communal spaces as a crucial feature.
How rightsizing is reshaping the housing market
Rightsizing reflects Australians’ desire to align their homes with their current needs, a shift that has implications across the housing market:
- Increased demand for versatile housing: There’s growing demand for homes with versatile layouts that can adapt to different functions – spare rooms that double as offices, for example. This flexibility appeals to both families and downsizers who want multi-functional spaces that can evolve as their needs change.
- The need to enhance apartment appeal: Apartments could provide a solution to supply pressures if they meet residents’ demands. Features like soundproofing, communal gardens, and co-working spaces would make apartments more attractive, giving residents the privacy and outdoor access they crave.
- Affordable, long-term rentals for younger Australians: With homeownership becoming harder to achieve, secure, affordable rental options are increasingly appealing to young Australians. Expanding long-term rental options could help reduce the need for Australians to enter the property market prematurely, adding more stability to the housing landscape.
- Senior-Friendly Housing Solutions: Older Australians need homes that are practical, accessible, and near services. Many seek apartments, yet they’re looking for features like secure parking and private spaces, which are not always available in apartment settings. Developers who cater to this demographic could alleviate pressures on the larger housing market by providing tailored senior-friendly options.
Policy recommendations for a rightsized future
Based on the report, Temple & Webster put forward several recommendations that could help address these challenges:
- Tackle affordability: Housing affordability needs to be front and centre, especially for younger Australians. By providing more affordable housing and secure rental options, Australia could create a more stable housing market without forcing people into ownership too early.
- Design for flexible living: Housing design should accommodate flexibility, allowing spaces to serve dual functions. This trend could benefit those looking to rightsize and families needing multipurpose spaces, offering a range of flexible options that evolve with life stages.
- Make apartments more appealing: Apartments need upgrades to attract more Australians. Soundproofing, communal gardens, and shared co-working spaces could significantly increase their appeal, making them a more attractive option for both young professionals and families.
- Encourage co-housing and shared living models: Co-housing could offer a win-win solution, making housing more affordable while building a sense of community. These shared living models reduce costs and provide social support, appealing especially to young Australians.
Moving towards a balanced housing market
Australia’s housing market faces a complex challenge.
As more Australians embrace rightsizing, developers, policymakers, and the real estate industry must align to offer solutions that reflect people’s real needs.
By investing in adaptable housing designs and focusing on affordability, Australia can build a housing landscape that supports its people’s evolving lifestyles.
