Affordable housing demand rises as buyers turn to strata properties

New data shows a growing trend towards more affordable housing options in Australia, particularly strata properties, as the cost-of-living crisis continues to impact homebuyers.

InfoTrack reports that house purchases in NSW have declined from 60.83 per cent of all property sales in Q1 2024 to 58.56 per cent in Q3. Conversely, strata property sales have increased from 31.43 per cent to 33.01 per cent over the same period.

Lee Bailie, head of property at InfoTrack, said these figures reflect broader housing affordability issues across the country.

“While the increase in unit sales may seem incremental, it shows home buyers are increasingly opting for more affordable housing solutions given current economic conditions,” Mr Bailie said.

The trend is particularly pronounced among first home buyers, with house transactions dropping nearly 5 per cent in this demographic since Q1 2024.

Western Sydney and the Central Coast have emerged as popular regions for first home buyers, with postcodes covering Liverpool, Campbelltown, and Parramatta topping the list of sales.

However, experts warn that supply of affordable housing may struggle to keep up with increasing demand.

Steve Douglas, executive chairman at SMATS Group, emphasised the need for a long-term, bipartisan approach to housing affordability in a recent submission to the Senate economics references committee.

“To succeed, this needs a genuine long-term, bipartisan, multi-tiered government and national plan as it cannot be done by any single level of Government or industry,” Mr Douglas said.

He stressed the importance of targeting new property creation in areas of highest demand, including affordable housing near city centres and transport hubs, family living zones, and downsizer properties.

“At the end of the day, stable and appropriate supply is the only way you can balance a market in a real and permanent manner,” Mr Douglas concluded.

As the shift towards more affordable housing options continues, industry experts are calling for coordinated efforts to address supply challenges and ensure sustainable solutions to Australia’s housing affordability crisis.