Demographics, stupid
Australia’s future housing demand
This Missive follows on from my recent post about pebbles amongst the stones.
Several punters wanted to know if I have a similar chart as shown for Ipswich in Queensland for Australia. Well yes I do and see below.
A few – just a few mind you, with one chappie really peeving my off – questioned my findings and commentary around the “missing middle”.
The cynics were mostly high-rise apartment developers after all.
Demographics, stupid
James Carville, allegedly, helped win the Presidency for Bill Clinton in 1992 with a sign in the campaign’s headquarters saying, “The economy, stupid”.
Well maybe there should be a sign saying – “Demographics, stupid” – on our desks as well.
Many in the economic, town planning and property space, including investors, tend to ignore or underplay the influence of demographic factors over the short and medium term.
But demographics matter.
Look at the chart below.
There is a need to build more homes over the next decade than the last ten years.
But not only has the demand lifted, it has shifted too.
We will need more new homes catering for the young and the old, with less for the age groups in between.
That suits those suppling downtown units, infill town homes, smaller ‘suburban’ apartment complexes and retirement villages.
It also suits the provision of ancillary dwellings, co-living and backyard housing solutions.
These housing forms can be done extremely well if a few rules are applied.
Much of this new housing supply will also need to cater for local demand, especially when it comes to older residents.
The irony is that that many ageing residents don’t want to see their suburbs change to cater for their future housing needs.
Local councils are often quick to agree. And for mine, the authorities need to show a lot more courage here and engage with the vocal NIMYBY’s, with the aim to lessen this no development mindset.
Of course, stamp duties also halt local housing moves and infrastructure charges (when levied per dwelling) hinder new affordable housing supply.
In addition, the size of the first home buyer cohort is limited, whilst the need for more homes that cater for families upgrading and our older peeps downsizing should rise.
Yet there is an almost total focus and bias on first home buyer benefits.
Many local authorities are looking to restrict infill development and implement financially unviable car parking regulations. Too many jurisdictions also levy infrastructure fees poorly. They are shooting themselves in both feet.
Our energies seem wrong.
Maybe a “Demographics, stupid” sign isn’t that stupid after all.
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