Lifestyle Changes: How Property Should Evolve

The Australian property landscape has undergone a remarkable transformation since 2020, with lifestyle changes driving unprecedented shifts in what we need from our homes. From pandemic-induced remote work arrangements to demographic transitions, the way Australians view property has fundamentally changed. Understanding these lifestyle changes isn't just about tracking market trends—it's about recognising that our homes must adapt to our evolving lives.

Lifestyle Changes Driven by Remote Work Revolution

The remote work revolution has been one of the most significant lifestyle changes impacting property needs. In 2020, roughly 15% of Australians regularly worked from home. By 2021, this figure had skyrocketed to 40%, representing 2.5 times the pre-pandemic rate. Even as we move through 2025, approximately 36% of Australian workers continue to maintain work-from-home arrangements, with 46%—representing over 6.7 million people—working remotely at least some of the time.

These lifestyle changes have fundamentally altered property requirements. The spare bedroom that once collected dust has become an essential home office. Properties with dedicated study spaces or the potential for conversion have seen increased demand, with 67% of Australian workers now preferring hybrid work arrangements. The average Australian saves 234 hours annually by eliminating commutes, making location flexibility increasingly valuable.

"Property isn't just about four walls anymore—it's about creating spaces that evolve with how we choose to live our lives," says Paul Virdi, Director of Alpha Real Property Group. "The most successful property investors and homeowners are those who recognise that flexibility is the new currency in real estate."

The Financial Impact: Lifestyle Changes Across Life Stages

Between 2020 and 2025, Australia's property market has demonstrated how profoundly lifestyle changes impact property values. Perth property values have surged by an astonishing 81.1% since June 2020, whilst Brisbane has recorded 75.1% growth over the same five-year period. These aren't random fluctuations—they reflect genuine lifestyle changes as Australians prioritise quality of life over proximity to traditional employment centres.

The nationwide median dwelling value reached $848,858 by August 2025, representing a 4.1% annual increase. However, these figures mask significant variations driven by lifestyle preferences. Adelaide, once considered a sleepy market, is forecast to reach a $1 million median by the end of 2025. Brisbane's median house price has already exceeded $973,000, driven largely by lifestyle migrants seeking affordability and climate advantages.

Downsizing vs Upsizing: Generational Lifestyle Changes

Australia's demographic shifts reveal fascinating patterns in lifestyle changes across different life stages. Baby Boomers, who make up 19% of recent property buyers, are predominantly downsizing to more manageable properties. This cohort is releasing an estimated 73% of larger family homes back into the market, creating opportunities for growing families to upsize.

Conversely, Generation X buyers are actively upsizing, seeking additional space for home offices, multi-generational living arrangements, or investment purposes. Millennials, having delayed property purchases due to affordability constraints, are now entering the market but trading traditional suburban houses for apartments. Unit prices in Brisbane, for example, have surged by 19.4% annually, reflecting these generational lifestyle changes towards more affordable entry points.

The downsizing trend has economic benefits beyond reduced mortgage payments. Smaller homes typically consume 30-40% less energy, require significantly less maintenance, and free up equity that can be redirected towards retirement savings or experiences. However, the decision isn't purely financial—many retirees discover they've downsized too aggressively and subsequently upsize to accommodate visiting family or hobby spaces.

Regional Migration: Major Lifestyle Changes Beyond Capital Cities

One of the most striking lifestyle changes from 2020-2025 has been the renaissance of regional property markets. Whilst capital city property values rose by modest margins through 2024-2025, regional areas recorded 1.0% quarterly growth even during periods when metropolitan markets contracted. This represents a complete reversal from historical patterns where capital cities consistently outperformed.

Regional areas now attract buyers seeking lifestyle improvements—better work-life balance, coastal proximity, and affordability. However, this trend faces challenges heading into 2026. Remote work adoption in regional Queensland, for instance, increased by only 16% compared to 30% in most other regional areas, partly due to lower wage offerings for remote workers in non-metropolitan locations.

Market Dynamics: Economic Lifestyle Changes

The relationship between interest rates and property needs provides crucial insights for 2026. The Reserve Bank of Australia commenced monetary policy easing in February 2025, with three rate cuts totalling 75 basis points bringing the cash rate to 3.60% by August 2025. These cuts have catalysed renewed market momentum, with national home values rising by 0.6% monthly through mid-2025.

Domain's Property Price Forecast Report projects average house prices will increase between 4-6% nationally through 2025, with KPMG predicting stronger 6% growth in 2026. However, these averages obscure significant variations. Perth is forecast to achieve 8-10% growth, whilst Melbourne is only beginning to recover from recent contractions of -1.3% for houses and -1.6% for units.

The Supply Challenge: When Lifestyle Changes Outpace Construction

Perhaps the most critical factor in understanding lifestyle changes and property needs is Australia's persistent supply shortage. The financial year 2024 recorded just 163,760 total dwelling approvals—dramatically below the National Cabinet's goal of 240,000 annual approvals needed to meet demand. This gap of approximately 76,000 dwellings annually compounds year after year.

Construction sector challenges intensified through 2024, with over 3,000 firms entering administration due to rising costs and shrinking profit margins. This supply constraint ensures that even with modest demand growth, property values remain supported. Rental markets reflect this imbalance acutely, with vacancy rates in Brisbane and Perth falling below 1%, driving significant rental price increases.

Looking Ahead: Anticipated Lifestyle Changes in 2026

As we approach 2026, several lifestyle changes will continue reshaping Australian property needs. Firstly, the "rentvesting" phenomenon—where younger Australians rent in desirable locations whilst investing in more affordable suburbs—will accelerate. This strategy allows lifestyle flexibility whilst building equity, reflecting evolved priorities among millennials and Gen Z buyers.

Secondly, the prestige property market shows signs of rebound. After two years where outer suburbs drove growth—with areas like Mount Druitt in Sydney's west surging from below $800,000 to over $1 million—the top 25% of homes by value began appreciating again in early 2025. This suggests the broader market recovery may follow historical patterns where luxury properties serve as bellwethers.

Thirdly, sustainability features will increasingly influence property selection. Energy-efficient appliances, solar installations, and water management systems are transitioning from nice-to-have amenities to essential features, particularly as utility costs rise. These environmental lifestyle changes reflect growing awareness among Australian buyers about long-term operating costs and environmental responsibility.

Finally, flexibility will remain paramount. Properties that can adapt—whether converting garages to studios, adding granny flats, or reconfiguring layouts—will command premiums. The lesson from 2020-2025 is clear: lifestyle changes drive property needs more powerfully than any other factor, and homes that can evolve with them offer the greatest long-term value.

The Australian property market has taught us that lifestyle changes are the primary driver of property demand. Whether you're a first-home buyer, upsizer, downsizer, or investor, success in 2026 and beyond requires understanding that property isn't static—it's a dynamic asset that must adapt to how we choose to live.

Understanding these lifestyle changes and their impact on property needs positions you to make informed decisions that align with both current market conditions and future trends. As Australians continue to redefine what home means to them, the properties that offer flexibility, functionality, and lifestyle enhancement will consistently outperform those that don't.

Disclaimer: This article is for informational purposes only and does not constitute financial or property investment advice. You should seek independent legal, financial, taxation or other advice to check how the information relates to your unique circumstances.