Australia’s houses are the world’s biggest and are still growing

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Australia’s move away from the McMansion phenomenon was brief, with bigger houses again all the rage, despite the housing market cooling because of the COVID-19 pandemic, or perhaps because of it.

Australia is still building the biggest houses in the world and the trend is that they are starting to get bigger again.

According to the latest CommSec Home Size Report, the average new house built in Australia in 2019/20 was 235.8 square metres, up 2.9 per cent on the previous year and the biggest increase in 11 years.

This growth allowed Australia to overtake the United States where houses built over the 2019 calendar year fell for the fourth straight year, down 3 per cent to 233.1 square metres.

Last month we reported on how the increase in people working from home had driven increased interest in remote locations, and those remote locations obviously do come with the added advantage of having more land to build bigger houses.

CUA’s home sentiment survey also revealed that Australians think homes offering a dedicated office space or rooms large enough to accommodate work desks are important considerations for their next home purchase.

And while YourLifeChoices often discusses the financial benefits of downsizing, there are also advantages for older Australians who upsize when they retire. With the primary place of residence being exempt from the assets test for the Age Pension, retirees who have assets at a level that reduces their pension can take the option of buying a bigger, or more expensive home, to ensure that they meet the eligibility requirements for a pension payment.

The report reveals that not only have Australian houses grown over the past year, so has the size of the average Australian apartment.

The size of the average new apartment lifted 6 per cent over the past year, hitting a decade high of 136.8 square metres.

Overall, the average new home (houses and apartments) built in 2019/20 was 195.8 square metres, a six-year high and up 3 per cent on the previous year.

The ACT built the biggest houses in 2019/20, ahead of Victoria, NSW and Western Australia.

The smallest new houses were built in Tasmania, with an average new house in the state being 179 square metres.

CommSec chief economist Craig James said that the latest figures revealed a significant change from previous years.

“Before last year, Aussie home buyers had been building progressively smaller houses on average,” Mr James said. “Aussies had embraced apartments as well as smaller houses on smaller lot sizes. In fact, the size of the average house built last year (2018/19) was the smallest in 17 years.

“So, while Aussies built bigger homes over the past year, the big question is whether the decade-long downtrend in home size has ended. And COVID-19 may play a big role in answering that question.

“Government-imposed lockdowns in response to the COVID-19 virus have prompted more Aussies to reassess their housing needs.

“With more time spent at home for both leisure and work, some Aussies are looking for bigger homes. Others are coming to the belief that the layout of their home needs changing.”

“There have been shifting trends in the sizes and styles of homes over the past decade and COVID-19 is throwing another element into the mix. More Aussies could embrace working from home in a bigger way, opting to move away from apartments in, or near the CBD, in preference for a larger home in a regional or suburban ‘lifestyle’ area,” Mr James said.

If you were building a new home for your retirement would you build bigger or smaller? Would you consider moving to an apartment for retirement or do you prefer living in a house? Is living close to a major city still important to you?

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Written by Ben


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