26/09/2012 - 10:22

Gen Y driving high-density build

26/09/2012 - 10:22

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Gen Y driving high-density build

DEMAND for medium and high-density dwellings and a cosmopolitan lifestyle in the suburbs is growing, but residential developers warn that the high building cost associated with multi-storey developments is drastically reducing their affordability. 

This demand is predominantly being driven by the gen Y market, which wants to live an inner-city lifestyle, near public transport, in close proximity to family and friends. 

Australand general manager residential WA Tony Perrin said there had been a strong shift between the fundamental mindset of young homebuyers and their parents.

“We’ve had instances where the father and son are arguing in the sales office in Clarkson because the father wanted the son to buy a conventional house a kilometre from the train station and the son wants a townhouse with no garden at the train station,” he said.

The Clarkson townhouse development is located 300 metres from the train station and is selling its final stage.

Australand also has a 47-apartment development next to Cockburn train station, which only has 14 properties left.

Realmark managing director John Percudani said the biggest trend he’d noticed was that proximity to transport had become a defining issue for homebuyers.

Mr Percudani told the forum medium-high density developments outside inner-city areas, such as Clarkson and Cockburn, were something that should be embraced.

“Once upon a time you had a one-bedroom apartment in the city … gen Y now wants that lifestyle where they live, we’ve been experiencing that particularly in the northern corridor.”

He said gen Y customers wanted the benefits of inner-city living without leaving the areas they grew up in, and that this was becoming a key factor in homebuyer decisions.

However, Pindan director of development & management, Nick Allingame, said developers faced a challenge between finding the right density and keeping land and construction costs down. 

 “Anything over four storeys and you’re probably not going to get much change out of $4,000 per square metre to build it,” he said. 

“By the time you put all your holding costs, consultants’ costs, land costs and profit and risks on to that you have to be selling it for a minimum of $7,000 to $8,000/sqm.”

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