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The Guardian - AU
The Guardian - AU
National
Benita Kolovos Victorian state correspondent

Downsizing the Australian dream: why families are trading houses with back yards for apartments

Joh Murray lives in a smaller-sized apartment in Collingwood with her husband and two daughters, Matilda, 3, and Ella, nine months.
Joh Murray lives in a smaller-sized apartment in Collingwood with her husband and two daughters, Matilda, three, and Ella, nine months. Photograph: Christopher Hopkins/The Guardian

The questions began when Joh became pregnant with her first child. They only got more frequent with her second.

“People start asking, ‘When are you moving? When are you guys getting out?’” she says. “They just assume you can’t live in an apartment any more.”

Joh’s daughters are now three and nine months old but she is still living in the two-bedroom, two-bathroom apartment she bought with her partner in Collingwood, in inner Melbourne, about five years ago.

The family have made some adjustments, such as turning their outdoor dining space into a play area, storing the pram in the second bathroom and hosting birthday parties and other gatherings in the apartment block’s communal spaces.

Yet Joh says the “pros definitely outweigh the cons”, citing the apartment’s proximity to shops, cafes and restaurants on Smith Street, as well as parks and public transport.

“I know the great Australian dream is definitely to have the back yard. But we’ve got the museum on our doorstep, the MCG up the road, trams out the front and plenty of parks,” she says.

“There’s heaps that outweighs the back yard, which you can only really use during the handful of days in Melbourne where there’s nice weather anyway.”

The family aren’t alone. A growing number of Australians are prioritising location over size.

According to research conducted by Great Southern Bank, 64% of Australian homebuyers would choose an apartment in order to afford to live in their preferred location. Families were most likely to compromise on a standalone dwelling to buy in their preferred location (72%), followed by first home buyers (65%) and downsizers (55%).

A survey conducted by Infrastructure Victoria in 2023 found one in five households would trade a detached home in a new suburb for a townhouse or apartment for the same price closer to city centres – if they could find one.

“We know from our research that many people want apartments but we’re not supplying enough of them in established areas of our cities, where people are willing to trade the freestanding home for a smaller apartment or townhouse near jobs and services,” says Infrastructure Victoria’s chief executive officer, Jonathan Spear.

According to the 2021 census, only 0.005% of all three-bedroom dwellings are contained within apartments.

In blocks that are nine storeys or taller, there are only 36,822 three-bedroom apartments nationwide, compared with 145,976 with two bedrooms.

Spear says “all of the policy levers”, including planning approvals, minimum parking requirements and financial incentives such as stamp duty concessions and first home buyers grants, discourage the construction of bigger – and better – apartments and townhouses.

“The combined effect is they’re pushing people toward the outer areas of our cities. Of course there’s demand on the fringes of our cities but we can and should do both. We should be trying to meet the unmet demand in the established areas because that’s better for our economy, the environment and all Victorians.”

He says the Victorian government must ensure child-friendly apartments and options for families are part of its plan to increase density in its established inner-Melbourne suburbs.

Liam Wallis, founder of developer Hip V Hype, says the industry remains stuck in a “vicious loop”: larger apartments are more expensive to build, which drives up their prices and makes them less competitive.

The construction of larger apartments, which Wallis says are a viable alternative to houses, is therefore limited and the apartments that get built end up catering to investors rather than renters.

“Investor-grade apartments are built for renters, they’re cheap as chips and they are missing the elements that create a home,” he says.

“Even the ones that have three bedrooms, they lack any personality, they lack any attributes that are needed to make apartment living more desirable. They’re designed solely with investors in mind.”

Wallis, who helped design, fund and build the Nightingale 1.0 and 2.0 developments in Brunswick, is now living in his latest project, Ferrars and York – a 22-unit carbon-neutral apartment block in South Melbourne, with his wife and two young sons.

He says 12 of the apartments are three-bedroom, which are “definitely more expensive” to construct than the one- or two-bedroom options. However, he says the apartments are thoughtfully designed with long-term residents in mind, who “jump at the opportunity”.

“Our buyer is somebody who has travelled, has spent time in central Europe and has experienced great-quality apartment living; they see that in some of our projects,” he says.

Living in the block with kids has also provided him with lessons for the next project in Brunswick. He says he plans to make the balconies higher and design the communal rooftop with a netting-style arrangement for “extra peace of mind” for parents.

“We’ve also decided to locate one- and two-bedroom apartments adjacent to each other in a way that we can combine the two apartments really easily to create larger apartments,” he says. “That could happen when we sell them or even in the future.”

One proposal he makes, which may stir controversy, is to eliminate the Victorian government’s mandated bedroom sizes, which he believes can restrict the construction of three-bedroom apartments.

“The bedroom-size requirements in Victoria are designed around a double bed and two side tables, which if you’re talking about children, they don’t need that space,” he says.

“It may be worth a rethink if we are serious about getting more families into apartments.”

As for Joh, she says while it’s likely the family will have to move as the girls get older, she hopes by the time they do, there will be more options available to them in the area.

“The government has to realise, if they want families to stay in the inner city, you need to keep providing for them. Put in bigger apartments, require they include more communal spaces, build more parks,” she says.

“You get quite attached to your community and your location. We really love it here and want to stay.”

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