Rising prices and modern lifestyles are causing Kiwis to rethink their decades-long obsession with oversized houses.
When Mark Fraser was looking to buy a house in Auckland in the mid-2000s, a real estate agent advised him to buy the biggest one he could.
“He said I should buy a four-bedroom house, not a three-bedroom,” Fraser says.
He didn’t need four bedrooms, but the agent said the resale value would be higher. He was adamant that bigger was better.
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Fraser says this is an example of the self-perpetuating cycle that led to New Zealand having among the largest houses in the world.
Industry was biased towards building big houses because that’s what people wanted because that’s what real estate agents were advising them to buy because that’s what was selling.
The Kiwi Dream has long been a standalone house on a quarter-acre section, but the size of that house hasn’t stopped growing.
The typical house 30 years ago was 140m2 with three bedrooms and one bathroom. Today, it’s close to 200m2 with four bedrooms, 2 bathrooms, ensuite, and a double garage.
“We became detached from what it is we really need.”
Fraser says Kiwis’ appetite for big houses is one of the factors contributing to the country’s current housing affordability issues.
“We completely shot ourselves in the foot.”
Turning the tide
Fraser is General Manager of Urban Development and Delivery at Kāinga Ora - Homes and Communities. He’s overseeing the delivery of about 25,000 new homes across Auckland over the next 10-15 years to the tune of approximately $30 billion.
Analysing market trends comes with the territory and Fraser is convinced that New Zealand’s appetite for huge houses is waning.
Rising property prices over the past eight years have forced buyers to be more conscious of what they can afford and what’s important, he says.
Lifestyle changes are also influencing housing preferences. As recently as the 1990s, the home was the hub for socialising and leisure. Cafe culture didn’t even exist.
Today, we socialise at cafes, bars and restaurants and our leisure activities are typically in gyms, shopping malls, and in the outdoors.
Family sizes are shrinking, New Zealand’s population is ageing, and one and two-person households are on the rise.
“The function of the house is reduced,” Fraser says. “It’s where we live, sleep, eat, and that’s incredibly important. But we don’t spend as much time there as we used to.”
Factor in the soaring demand for housing, particularly in Auckland, and the need for new types of houses for our new ways of living becomes clear.
“I think people are being forced to rightsize, but I would say that there’s an opportunity for us to do that really consciously, rather than just doing it because we have to,” he says.
Testing the waters
Fraser says the number one way to reduce the cost of a house is to make it smaller.
New developments at places like Hobsonville Point and in the Northcote development have proven that there is demand for smaller dwellings if they’re high-quality, stylish and functional.
Building terraces and two-bedroom dwellings at Hobsonville Point in 2012 was seen as a huge risk at the time, Fraser says, but they sold before they were finished.
“We’ve learned that good design does compensate for less room.”
Now terraced homes, walk-ups and apartments are being built all over Auckland, making better use of the city’s limited space than traditional standalone houses. Modern floor plans also use space more efficiently so a new terrace house or apartment can feel bigger and function better than the same square meterage in an old house.
The upside of rightsizing
Fraser says there are obvious benefits to rightsizing.
A smaller dwelling is more affordable, cheaper to run and easier to heat; rates and mortgage repayments are lower; and there’s less maintenance and yard work to do.
“The whole house is going to be more efficient and cost you less to live in.”
Smaller dwellings and different typologies, such as apartments and walk-ups, inevitably lead to higher-density neighbourhoods, similar to those in some of Europe’s most livable cities.
Fraser says a benefit of higher-density living that’s often overlooked is that it tends to attract greater investment in public amenities - parks, walkways, public transport and schools.
“So the other benefit is you get to live in better places,” he says.
“It’s easier to let go of the quarter-acre dream when your neighbourhood’s one big backyard.”
Fraser says New Zealand has come a long way in the 15 years since that real estate agent told him that bigger is better and attitudes to smaller dwellings are changing. “Unless you have a large family, then house size shouldn’t be your most important consideration.”
“We’re moving away from oversized houses to right-sized houses,” he says. “That’s the future I see for Auckland and New Zealand - a greater range of house sizes and typologies and buyers that are more conscious of what they need and what’s right for their lifestyle.”
- This content was supplied by Kāinga Ora
