In the heart of ultra-hip Brunswick, in Melbourne’s hotter-than-hot inner-north, a quiet housing revolution is underway.
It’s the dream of Melbourne architect Jeremy McLeod. Fed up with profit-driven projects and the lack of affordable housing in the inner city, he decided to re-imagine apartment development with an ethical edge.
Mr McLeod, founder of Breathe Architecture, and a group of like-minded architects decided to take matters into their own hands.
Enter the Nightingale model.
Built around the cornerstones of “intentional” community, environmental sustainability, and affordability, the model offers owner-occupiers the chance to buy thoughtfully designed apartments for 15 to 20 per cent less than market value.
“It’s really evident we need an affordable housing solution, and one that everyday Australians can attain, which isn’t really possible in the current market,” Nightingale business development lead Lola Digby-Diercks says.
The prototype, christened Nightingale 1, opened its doors to residents in late 2017. Among its eco credentials, the sustainable building has rainwater harvesting, a packaged heat pump, photovoltaic solar and rooftop gardens.
Ms Digby-Diercks said the idea of a ready-made community attracted purchasers, as much as the promise of sustainability and a discount on market prices.
“The purchaser group are put together a year before: they go on monthly walk-throughs, have drinks together, and get to know each other’s kids’ names,” she said.
For instance, purchasers in the group’s newest development, Nightingale Brunswick East, recently got together to watch the slab being poured for their future homes.
“It’s such a simple initiative, that we didn’t invent, but it’s so effective,” Ms Digby-Diercks said. “You know each other before you get the keys.”
Apartments in Nightingale buildings aren’t sold on the typical first-in, best-dressed basis. Instead, the developers use a “non-biased balloting system” – and every apartment has a covenant to ensure its affordability is passed on if residents sell. A maximum resale price is determined, using a formula based on market prices.
The company’s vision continues to expand, with plans for a village of affordable apartments in Brunswick, known as Nightingale Village. It will have seven buildings, and raise the bar even further – the aim is to supply homes for 25-30 per cent less than market value, using a German model known as Baugruppen.
The term translates as “building groups” and refers to a group that gets together to fund the development of a home.
Baugruppen is not uncommon in Europe, but such co-housing groups are relatively new to Australia. Nightingale Village will be the first commercial project to use the model.
“Until the housing market shifts or something radically changes to give everyone the opportunity to have a decent and affordable place to live, we’ll keep going,” Ms Digby-Diercks said.
Build-to-rent and rent-to-buy projects might also be on the cards,
“We’re not holding back in terms of trying things,” she said.
Supply and demand
With a nationwide waiting list of more than 5000 people, and just 400 apartments in the pipeline, Nightingale has more demand than supply.
“It’s such a pin-drop compared to the amount of people on our waiting list. We can’t keep up,” Ms Digby-Diercks said.
Commercial developers are also responding to demand for socially and environmentally sustainable housing – even if they are not yet addressing affordability.
“There’s a market shift in what developers are doing now. We’re not opposed to them copying part of [the Nightingale model],” Ms Digby-Diercks said.
“We’re not shy, we’ve seen it before, we know of developers quite close to us that are running similar models … we embrace it. If it changes the market, it’s good.”
“If it shifts the way they operate, and directs them towards a more sustainable housing model we’re happy.”
Sydney: The city that’s just too expensive
In bad news for Sydney-siders struggling to break into the market, high prices mean Nightingale is currently priced out of the market.
“We’re about delivering under the market rate – 20 per cent under – and at cost. If we know our starting cost is higher, then it’s [not feasible],” Ms Digby-Diercks said.
In June, Sydney’s median price was $1.012 million for houses and $752,625 for apartments, according to CoreLogic data. Despite Sydney dwelling prices falling slightly in the past year, it is still well above Melbourne’s median of $821,463 for houses and $574,304 for apartments.
“Anything we do comes down to site price, and where our purchasers are wanting to live,” Ms Digby-Diercks said.
“We can’t purchase the same sites as a developer because we’re delivering housing at cost.”