Australia’s housing market is facing a reality check: most households are small, but most homes are not. With 61% of Australian households made up of just one or two people, demand is shifting towards dwellings that better reflect how people actually live.
The Gold Coast Development Report – produced by Kollosche New Projects in collaboration with respected housing analyst Michael Matusik – reveals that “the missing middle” is now the fastest-growing segment of local development.
These boutique infill projects are small-scale, three-to-five storey apartment buildings and villas that slot into existing neighbourhoods, particularly along the light rail corridor.
Gold Coast City Council data shows 148 multiple-dwelling applications were lodged in 2024, with more than two-thirds involving fewer than 20 homes. That’s double the share seen just five years ago.
“Greenfield land south of Burleigh is essentially gone, so developers are focusing on infill sites,” said Mr Matusik. “The missing middle answers two problems at once – it’s more economical to build and it better matches the fact that most households today are one or two people, not families of four.”
The mismatch between household size and housing stock was highlighted in a report by Cotality, which found that only around 30% of Australian households are families with children, yet three- and four-bedroom homes dominate the market. By contrast, one-person households make up 27% of the population, but one-bedroom dwellings account for just 6% of the national housing supply.
Policy reforms are also aimed at narrowing the gap. The city’s new Low-Medium Density Residential Zone and a draft Temporary Local Planning Instrument both encourage townhouse and walk-up developments as the most efficient way to deliver housing.
The economics and planning settings are creating fertile ground for this shift. Buildings under 15 metres can clear code assessment more easily, while timber-frame walk-ups cost 30 to 50% less to deliver than high-rise towers. Shorter build times – often 18 to 24 months compared with three years or more for towers – further reduce cost escalation risks.
Emerging hotspots are forming around Stage 3 of the light rail. Areas such as Nobby Beach, Miami, Second Avenue in Burleigh Heads and South Palm Beach are attracting a wave of applications, with sites within 400 metres of new tram stops seen as low-risk, high-velocity opportunities for developers and investors.
Kollosche Managing Director Michael Kollosche said boutique properties had struck a chord with buyers seeking alternatives to both large homes and high-rise towers.
“Not everyone wants a 30-storey tower or a house with four bedrooms they’ll never use,” he said. “Some people are drawn to smaller buildings with fewer neighbours, more privacy, and lower body corporate fees. Boutique developments offer that balance – big enough to feel like home, small enough to fit modern life.”
With demographics, economics and planning rules now aligning, the missing middle is shaping up as the Gold Coast’s most important development frontier.
