Townhouses are the way of the future

Building approvals for higher-density homes inclusive of apartments and townhouses fell again over 2020 – the fifth consecutive year of declining development with no prospect of a sustained revival inactivity.

Significant government stimulus initiatives specifically directed at the housebuilding sector have resulted in a surge in planned construction.

However higher-density development approvals clearly remain subdued by comparison, accounting for just 34.7% of total home building approvals – the lowest market share since 2010.

Townhouse construction continues to outperform units, reporting a slight increase in annual activity, with a 42.7% market share of overall higher-density development- the highest proportion for 11 years.

All capitals reported declines in building approvals for units over 2020, with Adelaide and Perth the clear underperformers.

Brisbane and Melbourne recorded high levels of planned townhouse development over 2020 with Sydney stable.

Abs Report

National townhouse building approvals continue to outperform units, with an annual increase of 1.7% over 2020.

Brisbane has clearly been the top townhouse performer rising by 31.7% with Melbourne higher by 7.1% and Sydney steady over 2020 compared to 2019.

Sydney reported an average per townhouse building cost of $335,145 over 2020 that was an annual increase of 5.0%, with Melbourne at $341,242 – up 1.3%, Brisbane $232,862 – down 0.7%, Adelaide $248,222 – up 7.4%, and Perth $271,440 – up 8.2%.

Abs Report2

Capitals Building Approvals

Sydney reported the highest number of building approvals for units over 2020 with Melbourne tops for townhouses and also the leader for overall planned higher-density development.

Annual Building Approvals

Brisbane was the top-performing Local Government Area over 2020 for townhouse building approvals followed by Canberra, Moreton Bay, Blacktown, and Logan.

2020 Townhouse Building Approvals

Melbourne City was the top-performing Local Government Area over 2020 for unit building approvals followed by Brisbane, Canberra, Yarra and Blacktown.

2020 Unit Building Approvals

Although house building is booming driven particularly by the federal government’s HomeBuilder incentive policy, the development of higher-density homes remains significantly subdued.

The demand for townhouses, however, continues to rise reflecting growing preferences for larger higher-density homes compared to units – a trend likely to be enhanced as a result of increased ‘work from home’ activity and the need for more space as an outcome of 2020 coronavirus restrictions.

The challenge for governments at all levels is to provide suitable land for medium-density development, particularly in popular inner and middle-ring suburbs.


Subscribe & don’t miss a single episode of Michael Yardney’s podcast

Hear Michael & a select panel of guest experts discuss property investment, success & money related topics. Subscribe now, whether you're on an Apple or Android handset.

Need help listening to Michael Yardney’s podcast from your phone or tablet?

We have created easy to follow instructions for you whether you're on iPhone / iPad or an Android device.


Prefer to subscribe via email?

Join Michael Yardney's inner circle of daily subscribers and get into the head of Australia's best property investment advisor and a wide team of leading property researchers and commentators.

Dr. Andrew Wilson


Dr Andrew Wilson, Chief Economist of is widely regarded as Australia’s leading property economist.

'Townhouses are the way of the future' have no comments

Be the first to comment this post!

Would you like to share your thoughts?

Your email address will not be published.


Copyright © Michael Yardney’s Property Investment Update Important Information
Content Marketing by GridConcepts