3 million more strata units one solution to housing crisis

The research by CoreLogic and AI-driven property solutions provider Archistar has identified the potential to build more than three million additional strata units over almost 1.3 million sites across Australia’s capital cities.

According to the report, titled The Missing Middle: The Greatest Opportunity for Medium-Density Development, this could provide one potential solution to Australia's growing housing crisis.

The report defined strata units as low to medium-density dwellings or infill developments such as apartments, townhouses, duplexes, or triplexes.

Most of the sites identified would yield a relatively low-density development, with the average number of units that could be built per site just 2.5. As such, these types of homes would be the most appropriate style of strata housing for the majority of these sites, the report said.

Of these, 16 per cent – or the potential for almost 500,000 new units – are situated on low complexity sites, which are typically level blocks without heritage overlays or risk of a hazard such as bushfire or flooding.

More than half (or 57 per cent) of the potential new strata unit opportunities identified are within two kilometres of an existing station, with Sydney recording the highest proportion of potential strata developments close to a train station at 66 per cent.

The report explained that the analysis was based on assessing the development potential of capital city land that currently does not have a strata development (that is, detached homes and vacant land), and where the town plan and local precedents allow for a higher density dwelling type.

The analysis excludes high-rise and mixed-use opportunities, with the average number of potential units per site at just 2.5.

Melbourne was singled out as having the largest number of sites with more than 472,000 lots and the potential to deliver almost 1.2 million new strata units. Twelve of the top 30 council regions for strata infill opportunities were located in Melbourne.

This was followed by Sydney with just under 351,000 sites and the potential to build more than 934,000 new units.

Both Brisbane and Adelaide had the potential to build almost 400,000 new units, followed by Perth which had the potential to supply more than 163,000 new units.

CoreLogic research director Tim Lawless said the national cabinet had a challenging road ahead when it came to delivering on its commitment to supply new housing.

“With a target of 1.2 million new ‘well-located’ homes nationally, all tiers of government are likely to be focussed on identifying and fast-tracking strategic development opportunities,” Lawless said.

“Governments are looking for ways to maximise opportunities for new well-located housing with a focus on strategic densification near transport nodes, maximising infill targets and ensuring an equitable supply of affordable housing options.

“Importantly, this analysis isn’t identifying or recommending high-rise apartments as a solution to the housing crisis. It identifies opportunities for low-rise strata units that would typically take the form of townhouses, duplexes or triplexes.

“This style of infill development is often more sympathetic to the local character and tends to encounter less resistance from local residents who are often wary of higher densities.”

Archistar co-founder Dr Benjamin Coorey added: "The ‘Missing Middle’ report identifies significant opportunities within our urban areas to address housing shortages through more diverse, medium-density developments. These findings provide a crucial foundation for future planning and policy development across Australia.

“This research highlights the latent capacity for medium-density housing solutions in urban areas, demonstrating the importance of aligning design innovation with planning frameworks to achieve sustainable growth.”

“Understanding the potential for the ‘Missing Middle’ is a vital step towards tackling Australia’s housing challenges. The report underscores the need for data-driven approaches to maximise underutilised land and optimise urban planning outcomes.”

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