Australia is facing a critical housing supply crisis in 2024, highlighting an urgent need for sustainable urban development that both optimises land use and prioritises rapid urbanisation in a sustainable way. A recent report by the Urban Development Institute of Australia forecasts that new home completions will drop to just 79,000 by 2026—a staggering 26% decrease from the previous year. This decline comes at a time when Australia’s population is booming, with a record net gain of 518,000 people in 2022-23. This has also put the Australian rental market under extreme pressure, with rents hitting an average of $614 per week in February and a national residential vacancy rate of just 1%.
These figures underscore the urgent need for sustainable urban development strategies that can help address the growing housing shortfall. Sustainable urban development is not just about building environmentally friendly structures; it’s about creating urban spaces that are functional, resilient and capable of supporting a growing population in a way that is economically, socially and environmentally sustainable. In this context, sustainable urban development emerges not just as an ideal but as a critical necessity for addressing Australia’s housing woes.
What Does Sustainable Urban Development Look Like?
As Australia, like much of the world, faces rapid urbanisation, the need for sustainable urban planning becomes increasingly urgent. The global population reached 8 billion in 2022, with over half living in urban areas, a figure expected to rise to 70% by 2050 according to the United Nations. However, many cities, including those in Australia, are unprepared for this surge, resulting in inadequate housing, strained infrastructure and environmental degradation.
One of the UN’s Sustainable Development Goals, Goal 11, is focused on addressing and preventing these issues. Goal 11 is about making human settlements resilient and sustainable, encouraging property developers and government authorities to prioritise the creation of affordable housing, optimised infrastructure and green spaces. Addressing this goal with the right development strategies should be a priority for both property developers and government authorities, maximising the utility of residential land and the infrastructure that supports it.
One of the primary ways this can be achieved is by increasing the density of housing in urban areas without compromising on quality or liveability. Higher-density developments, such as apartment buildings and townhouses, can accommodate more people within the same land area compared to traditional single-family homes. When designed with sustainability in mind, these developments can provide high-quality living spaces that Australians will want to live in.
This approach not only addresses the immediate demand for housing but also ensures that new developments contribute positively to the urban environment and support the achievement of Sustainable Development Goal 11. This is also a core focus for the OECD (Organisation for Economic Co-operation and Development), with over 100 countries from around the world aiming to address this goal by re-focusing the urban sprawl within major cities.
Creating more compact residential developments within Australian cities should be at forefront of the sustainable development agenda. But the need to enhance sustainable urban development does not stop there. Without ensuring these compact developments are connected to public transport, energy efficient and integrated into the natural environment, Australians simply won’t want to live in them, and the long-term goal of improving the housing supply will continue to suffer.
Further Strategies to Enhance Sustainable Urban Development In Australia
As stated previously, sustainable urban development is about more than building eco-friendly structures or avoiding disturbances to the natural environment. When designing new developments and residential structures, developers and urban planners need to take a holistic approach that aims to create a thriving community that is fully integrated into both the natural environment and the infrastructure that surrounds it. New developments must be designed in a way that optimises land use, enhances that surrounding infrastructure and helps to ensure that urban growth is managed in a way that is sustainable in the long-term.
Some factors that will contribute to the success of these developments follow. Each plays a part in improving the quality of life for potential residents and also act as selling points for those looking for an alternative to the standard, suburban quarter acre block.
Transportation Connections
One of the major advantages of compact urban development is the ability to service these large residential communities with public transport options. Large urban sprawls like the Melbourne metropolitan area naturally lead to longer commute times and more vehicles on the road, with compact urban development able to reduce both by bringing residents closer to the CBD, the workplace and schools. This is of course only possible with sufficient transportation connections, making urban planning around these developments all the more important.
Green Spaces
Integrating the natural environment and green spaces into urban development is another key strategy to successful urban development. This is already a priority in Melbourne and several other Australian cities, aiming to enhance resilience to climate change in these urban environments and the connections urban spaces have to nature. From improving air quality to reducing stormwater pollution, integrated green spaces can really add to the quality of life to those both living and working near these spaces, and make them more enticing for further urban development.
Energy-Efficient Buildings
Making our buildings more energy efficient, residential or otherwise, should be a priority for developers, and not just to reduce environmental impact and CO2 emissions. Increasingly, power bills are becoming a worry for Australians, yet another rising cost that has hit Australian families recently. By integrating energy-efficient technologies, like solar panels, improved insulation and upgraded air conditioning systems, into these developments, residents within compact urban developments should see a consistent drop in their power requirements and in-turn their monthly bills.
Reducing The Urban Sprawl
Ultimately, one of the core goals of sustainable urban development should be to reduce the urban sprawl in large Australian cities. While residential density in major Australian cities has increased, so has the urban sprawl, adding further fuel to property prices and longer commute times for Australian workers. Left unchecked, this urban sprawl will only continue to expand further and further. This is not just a problem for suburban residents. With an expanded urban sprawl it will become harder and harder for property developers to create new estates that actually meet the needs of those they are looking to sell to. Excessive commute times and difficult connections to services will make these developments unattractive to potential buyers, likely forcing them to buy an existing property, ramp up the price of housing in these areas and further decrease the housing supply in Australian cities.
Creating Compact Cities That Australians Want To Live In
Last year, Infrastructure Victoria presented a report to the Victorian Government that showed that the state could be $43 billion better off by 2056 if it focuses on developing a more compact Melbourne. The report underscored the immense benefits of creating compact cities that concentrate new homes within existing urban areas rather than allowing sprawl to extend into the urban fringes. By creating new apartment building, townhouses and other mixed-use developments in these areas, productivity in the construction industry would be enhanced and provide the public with greater access to jobs and reduce reliance on cars and road networks.
To achieve this vision of compact urban living, the report makes several key recommendations, including setting housing targets for both new and established areas, streamlining planning rules to facilitate the construction of medium-density homes and establishing urban growth boundaries for regional cities. These strategies align perfectly with the sustainable urban development points discussed earlier in this article, working to create more compact Australian cities with connections to both the environment and infrastructure that are needed to support modern living.
By focusing on creating compact cities that integrate well with transportation, green spaces and energy-efficient residential buildings, Australia can address its housing supply crisis in a way that is both sustainable and desirable. Compact, well-connected urban areas will not only help address the immediate housing shortage but also reduce the strain on property developers and help to create vibrant communities that Australians will want to call home for generations to come.
DPM Consulting Group has been working with property developers to meet the needs of modern Australians for over 30 years. We’ve helped nearly 300,000 families find new homes since our establishment, supporting residential developers to create spaces that become thriving urban communities. To learn more about our urban development services, latest residential projects and land development insights, click the button below.
