Is the Townhouse the New Australian Dream?

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First, it was the quarter-acre block, then it was a battle-axe.  Suddenly, we were all about to live in apartments.  But now, new figures have revealed the popularity of townhouses is soaring, with approvals at record levels in Australia’s biggest cities.

In the 12 months to December 2017, townhouse approvals had the strongest year on year growth at 21% in Victoria (VIC) and 28% in New South Wales (NSW).

Conversely, in the same period, the number of approvals for detached houses in NSW and VIC fell by 2% compared to the previous year – with more Australians shifting away from detached houses in favour of higher density living.

An analysis of ABS dwelling unit data over the last 5-7 years has shown an exponential increase in townhouse approvals as more developers seek to meet demand.

In 2017, annual townhouse approvals rose by 124% in Victoria (VIC) and 128% New South Wales (NSW), compared to 2011 figures.

Housing approvals drop

While the rate of growth for townhouse approvals has remained robust and positive for the last 5 years, the rate of growth for traditional detached housing approvals has been declining over the same period, with weaker overall year on year growth.

Houses and Townhouses rates of growth compared

Houses and Townhouses rates of growth compared second graph

Over the past 5 years, VIC townhouse approvals averaged an annual rate of growth of 14.4% and NSW townhouses averaged an annual rate of growth of 15.3%. Detached housing approvals increased at lower rates of 2.6% and 9.3% respectively.

Comparable backyard to a House & Land

Typically, townhouses provide a more affordable, family-friendly alternative to a detached house, with more indoor and outdoor space and privacy than an apartment, but without the cost and upkeep of a larger home on a big block.

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What’s interesting to note, however, is that many new townhouses aren’t compromising so much in the way of backyard space anymore.

And, as Melbourne keeps expanding, many are spending hours travelling between their new McMansion and work.  Townhouses tend to be located in more accessible locations.

Many Chan & Naylor clients have contacted us about building townhouses or duplexes on their own land.  Chan & Naylor can provide you with advice on the tax and finance implications of doing this.   Contact us today.


Aside from townhouse tax and financial advice, have a look at our other accounting and advisory services that we do to help you achieve greater success.

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Chan & Naylor Group has nationwide offices in North Sydney, South West Sydney, Sydney, Pymble and Parramatta in New South Wales, Melbourne, Moonee Ponds and Hawthorn in Victoria, Brisbane and Capalaba in Queensland, and East Perth in Western Australia that can assist you with your townhouse loan applications as well as any property tax or business tax enquiries that you may have.

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