Changed patterns of dwelling demand and supply
This research undertaken for the Australian Housing and Urban Research Institute by researchers from Curtin University and Monash University examines the impact of the COVID-19 pandemic on patterns of housing supply and demand and how the Australian housing market has changed over the last decade.
It found COVID-19 changed what households want from their home: more space, both inside and out, which was linked with the ability to work more from home and a heightened demand for lifestyle locations. The pandemic led to significant and distinct changes in where people wanted to live, with low or negative growth in inner urban areas; growth in regional towns and cities (particularly those associated with sea and tree changes); and strong growth in traditional first home buyer areas, primarily on the urban periphery.
Key Points
- Residential transactional data for Victoria and WA were examined across two time periods to assess the impact of COVID-19. Both Victoria and WA saw similar patterns of price increases, despite very different COVID experiences. The subsequent market response to rising interest rates has been starkly different, with prices falling in Victoria but remaining steady in WA.
- State and local governments need to ensure housing supply is more responsive to avoid affordability pressures from demand shocks. Regional areas are especially vulnerable to demand pressures.
- The COVID-19 stimulus measures delivered an increase in the supply (approval) of houses between 1 and 47 per cent across the five largest states, while the amount of ‘other residential’ supply fell. The location of the supply increases was generally in outer urban areas.
The Report
The new normal: changed patterns of dwelling demand and supply is available to be read.
