Can medium-density properties help with housing supply?

Australia continues to be in what many have labelled a housing supply crisis amid rising population numbers and near-record low dwelling commencements.

Although there have been measures introduced to address Australia’s housing supply shortage – namely, the Albanese government’s “ambitious” housing target of 1.2 million new homes by 2029 – there are still debates around what more can be done in the meantime.

Speaking on the Mortgage Business Uncut podcast, Momentum Media director and co-founder Alex Whitlock discussed the “attractive” prospect of building medium-density properties to ease these supply pressures.

“People in their suburbs don’t like change. It’s pretty natural for whoever you are and wherever you live,” Whitlock said.

“...[But] building attractive medium-density property makes sense to me. You can make your bit of dough if you’re a developer and then you’re creating multiple dwellings – and usually affordable apartments – so you’re easing the burden.”

Adding to this, Momentum Media director and co-founder Phil Tarrant said that more apartment builds need to continue happening.

“Just looking at all those greenfield sites [out near Windsor], there’s a lot of housing estates being built there. But, you can see that medium to high density is happening, and that’s what needs to happen because infrastructure is really expensive,” Tarrant said.

“We can’t just keep building highways and freeways and railways out further into the regions.

“What needs to happen is that we need to infill that because you get all the benefits and scale of that money spent on infrastructure.”

From a financing perspective, Whitlock further stated that it’d be interesting to see the challenges and opportunities there are for lenders and brokers.

“Going back, looking at high-density building that’s taken place in all of the capital cities, you’ll get lenders that are in the market and then out of the market and there’s policy around studios and [financing]. It’s a delicate balance,” Whitlock said.

“I think for many Australians, they want to have that block of land, but I think there has got to be a shift in and around, whether it’s inner-city living or going out into the outer belts and the type of accommodation you’ve got and the affordability of it.”

Tarrant added that there are certain areas that have postcode restrictions from lenders that “don’t want to touch apartments in those areas because they feel as though they’re overvalued”.

“There’s a lot of friction around it because people don’t want to buy, lenders don’t want to lend against the properties [it is affordable] to buy in,” Tarrant said.

If you’d like to find out more, tune in to Mortgage Business’ Mortgage Business Uncut podcast below:

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