Australia's residential housing market is facing similar challenges to New York City's. What can we learn from their solutions?
On the surface, it wouldn't seem like Australia's residential property market has much in common with New York City's. However as I found on my trip to the city earlier this year with the UDIA (QLD) , there is plenty that Australia can learn from New York City.
The two key challenges New York City is facing are also beginning to have an impact on Australia's property market, albeit on a much smaller scale. Property development in the Big Apple is characterised by extremely dense urbanisation and a growing population, both of which are influencing the types of structures being built. During the UDIA (QLD) tour, we were able to visit projects that offer solutions to these issues, which may be a valuable influence for developers on this side of the world.
New York Developers react to population growth
Like Australia, New York City's population is growing as more people seek residence within the city, especially in popular areas such as Brooklyn and Manhattan. In a presentation from the New York City Building Congress, it was revealed that as many as 500,000 people move to the greater New York area every year. This means the market continues to remain strong, providing a stable environment that supports some of the major developments we had the opportunity to visit.
For an environment that is already highly urbanised, this ongoing migration means the solution is to focus on high-density living arrangements. However, this doesn't mean developers are simply packing residents into claustrophobic apartments, with the latest trends revealing that people have found a new way to think about density.
Mercedes House is at the forefront of this new way of thinking, as the developers sought to create a feeling of community between the people who inhabit the 1,000 units. The reason for this community focus is due the fact that, to overcome the density challenge while still meeting demand, the actual apartments having to be tiny, in some cases being little more than 40 square metres.
For Australians used to having a house on a section, it sounds like a daunting prospect, but it's one that's making waves throughout New York. People actively want to live there - there's even a waiting list, as hopeful residents are drawn to the social atmosphere that's created through the use of shared spaces.
What can the Australian market learn?
Developers in New York City are aware of the key challenges that face the residential property market and therefore seek creative ways to make solutions more attractive. In this respect, there's plenty for Australia to learn.
Home ownership is entrenched in Australian culture, which means a shift away from this mentality will not change overnight, but will shift over the course of a generation. However, by learning from New York, it's possible to create the same sense of excitement that's resulting in waiting lists at developments such as Mercedes house.
The key will be to capture the idea that higher-density apartments are more than just smaller living spaces. By creating shared environments that create a social aspect to these structures, such as BBQ areas, communal pools, gyms and others, these arrangements become much more attractive.
Again focussing on the Mercedes House example, its residents have access to events such as regular movie nights and yoga, resulting in a tight-knit community that's defined by more than just compartmental living.
Like New York City, Australia can overcome challenges associated with a growing population and making high-density living attractive. While the New York City may operate on a much larger scale, the lessons are just as valuable on this side of the world especially as the younger generation want to live closer to the city where the action is. They also want all the modern state of the art technology available to them where they live