A significant shift in housing demand is expected over the next decade as millions of people move into a new stage of life. Social demographer Bernard Salt highlights that those entering their early 40s often reassess their living arrangements, particularly when family needs expand. At this age, many households begin seeking larger homes, prioritising space and stability over the convenience of apartment living.
Currently, there are around 3.6 million people in Australia aged in their “40-something” bracket in 2026. This figure is forecast to increase to 4.2 million by 2036, representing a 16% rise. The growth of this demographic group is expected to play a pivotal role in shaping housing demand, especially in established urban areas where family homes remain desirable.
Entering the early 40s is often seen as a turning point in the typical housing lifecycle. Many couples reach a stage where career stability and growing families lead them to reassess their living environment. Apartments or smaller dwellings that once suited a younger lifestyle can become less practical as children arrive or work from home arrangements become permanent. The need for extra bedrooms, outdoor space, and proximity to schools begins to dominate housing decisions.
This demographic change is expected to increase demand for traditional detached homes on individual blocks of land. Larger houses in family oriented suburbs are likely to become particularly attractive to this cohort. Such properties offer the space and flexibility required for expanding households, making them the preferred option for buyers transitioning out of inner city apartment living.
The distribution of this population growth will not be uniform across the country. According to Salt’s projections, Melbourne will see the largest increase in people aged in their 40s, with an additional 131,000 residents in that age group over the next decade. Sydney is expected to add 114,000, while Brisbane will grow by around 57,000 within the same demographic bracket.
These increases will influence where housing demand concentrates. In Melbourne, established metropolitan areas will likely attract buyers looking for long term family homes. In Sydney, western suburbs are expected to see increased demand due to their relative affordability and availability of larger properties. Brisbane’s southern suburbs may also become more appealing as buyers search for space while remaining connected to employment centres.
Another factor that may influence purchasing behaviour among this group is the earlier transfer of family wealth. As property prices remain high and upgrading becomes more expensive, some parents may choose to assist their adult children earlier in life. Salt suggests that intergenerational wealth transfers could play an increasingly important role in enabling housing upgrades.
Rather than waiting decades to pass on assets through inheritance, families may decide to support their children financially while they are actively raising families. Providing assistance in a person’s 40s can have a greater impact than doing so later, particularly when housing costs and family expenses are at their highest.
This trend could reshape traditional patterns of property ownership. Younger generations may gain earlier access to housing upgrades, while parents see the benefits of helping their children establish stable family homes sooner. The timing of wealth transfers may therefore become a strategic decision rather than simply part of estate planning.
Overall, the growing number of Australians entering their 40s is expected to be one of the most powerful drivers of housing demand in the coming decade. Their preferences for larger homes, suburban locations, and family friendly environments will influence the types of properties that become most sought after.
As this generation progresses through the housing lifecycle, the ripple effects will likely be felt across the entire property market. Demand for larger houses may intensify, development patterns could shift, and generational wealth strategies may evolve to support housing transitions.
