Australians think big again on home sizes

Government lockdowns in response to the COVID-19 pandemic have prompted people to reassess their housing needs with more time spent at home for both work and leisure.

An analysis by Commonwealth Securities shows 11 years ago Australia was building the biggest detached houses in the world.

But over the past seven years homes have become progressively smaller on average and apartments have been embraced, with houses shrinking to their smallest in 17 years in 2018/19.

But data commissioned by CommSec from the Australian Bureau of Statistics shows Australia is again building the biggest houses in the world.

The ABS data shows the average new house built in 2019/20 was 235.8 square metres, up 2.9 per cent on the year and the biggest increase in 11 years.

In contrast, the latest data shows US houses built over 2019 fell for the fourth year, down three per cent to 233.1 square metres.

CommSec economists Craig James and Ryan Felsman said the recent experience with COVID-19 has certainly caused more families to look for bigger homes and caused others to add extra rooms to existing homes.

The pandemic may also lead to greater cohabitation, such as children returning to their family or parents living with their parents.

If more people decide to work from home, this will have implications for central business districts of capital cities, including office and retail space usage, cafes and restaurants, services such as hairdressers and public transport services.

If more opt for a sea change, this will have implications for home prices, housing supply, and roads, schools and hospitals in outer suburbs and regional areas.

Mr James and Mr Felsman say the trends from COVID-19 are still emerging.

"If a vaccine were to be found in coming days and weeks, then there may be a return to pre-virus 'normalcy'," they said.

"However, it certainly does appear that many so-called norms have been challenged and are, or are being, reassessed."

Australian Associated Press