AHURI BRIEF

Are greyfield suburbs the key to housing our growing population?

Precinct-level design can lead to better amenities for all residents

Last updated 7 Mar 2019

By 2050, Australia’s population is projected to reach more than 35 million, with over 70 per cent of this growth in the capital cities. One way of accommodating this growing population is by rebuilding and regenerating ‘greyfield’ suburbs. These middle suburbs of large Australian cities feature ‘under-utilised property assets such as privately owned and occupied residential building stock, usually built between the late 1940s and the 1970s, that is failing physically, technologically and environmentally. Typically these suburbs also contain energy, water and communications infrastructure in need of regeneration’ together with older, physically run-down community assets, such as tennis and bowling clubs.

What is the best way to redevelop greyfield suburbs?

Currently greyfield suburbs are often being redeveloped piecemeal by smaller scale developers. Their building projects feature buying a single house on a larger block of land, demolishing the house and then building two or more townhouses or a smaller apartment block on the site. AHURI research shows this form of development ‘requires a risk averse approach and therefore design innovation is infrequent; familiarity and lowered costs are achieved by using established housing types’. Such an approach leads to a greater level of densification but it doesn’t improve liveability, whereas well thought through precinct-level design can lead to better amenities for all residents, both old and new.

Currently greyfield suburbs are often being redeveloped piecemeal by smaller scale developers... Such an approach leads to a greater level of densification but it doesn’t improve liveability, whereas well thought through precinct-level design can lead to better amenities for all residents, both old and new.

The current economics of greyfields developments means precinct level development is only profitable when building in activity centres, transport corridors and brownfield redevelopments (e.g. large ex-industrial sites). If developers attempt to build larger precinct style redevelopments in greyfields suburbs (which include redeveloping transport, water use, landscaping, new community assets etc.), there are considerable costs in acquiring and holding onto existing residential properties, as well as high levels of uncertainty as to whether planning permits will be issued or if any complaints made by neighbouring residents will be upheld.

How can new ‘market matching’ technology help?

If governments and developers could easily and efficiently find groups of property owners who would be prepared to sell their properties for redevelopments that would lower the costs of such developments, while also possibly giving the groups of owners higher returns for their bundled properties.

AHURI research has found that an online digital ‘market matching’ platform could enrol interested property owners in greyfield suburbs, allowing them to say if they might be interested in selling and, if so, within what time frame. Matching markets are markets in which a person or group seeks to be paired with someone who has a highly specific product or requirement.

Such an online matching market platform would allow developers to strategically target particular areas to build precinct style developments that could benefit the wider community and to provide a cost-effective mechanism for managing engagement over a long period. Indeed a developer who intends to buy residential land may propose a different larger-scale, precinct-style development project if they knew adjoining landowners were also willing to sell.