Assemble's 393 Macaulay Road, Kensington Victoria development.

Around 6000 people have signed-up to a database in Melbourne to rent apartments for five years, with an option to buy – complete with all the trimmings you need to build a great community. 

Assemble managing director Kris Daff and the team arrived at the unique housing model from a bunch of research and lessons from overseas about what makes great apartment living.

One key discovery was that building a sustainable community is “super important.” He says if someone forms meaningful relationships they will stay in a home 2.5 times longer than someone who feels isolated.

The next step was a deep dive into the problems facing Australia’s housing market.

He says that Australia is a binary housing market, where you either own or rent. Unlike in Europe, where collaborative housing and other alternative housing models are common, in Australia “there’s sort of nothing in the middle”.

The challenging part of renting is tenure – it’s relatively short term, with year-to-year leasing common. This means tenants don’t have the same opportunities to become ensconced in a community and volunteer at the local charity, form a relationship with their GP or allow children to stay at the same school.

Renters are also dislocated from the building, with no say on how a building is run or managed. Even getting a tap fixed can be a nightmare.

People are starting to feel a bit “ripped off”

But skyrocketing housing prices means ownership remains out of reach for many, including middle income earners.

Daff says people are starting to feel a bit “ripped off” because they feel like the housing market is not designed for them and that they are stuck as a renter paying off someone else’s mortgage on their investment property.

Despite unfavourable conditions, Australians haven’t given up on home ownership. Daff’s view is that most Australians still associate home ownership with financial security because that’s how their parents and friends manage their personal wealth.

He says anxiety about retirement without home ownership creates a deep drive to own a home.

On top of that, the quality and safety issues plaguing the building industry make buying off the plan a risky prospect.

How to change things: give people a say, first up

So Daff came up with a model that addresses these challenges.

It works by allowing prospective purchasers input at key stages prior to construction, which maximises flexibility and customisation.

Customers are then invited to sign up to a five-year lease, with the option to purchase their apartment at a pre-agreed price.

The company also offers complementary financial coaching to residents to help them achieve their savings goal to buy their apartment at the end of the lease if they decide they want to.

Unlike a rent to buy model, which sees tenants pay above market rental rates to go towards a deposit, tenants don’t contribute to a deposit and just pay market rental rates.

That means if their circumstances change or they decide they don’t like the neighbourhood, they aren’t trapped into buying the home.

Critically, the model puts renters in a more empowered position.

“We try and foster a sense of ownership of the building in advance of any transfer of title or formality.”

Every six months an owners corporation-style meeting will be held for tenants.

This gives tenants owner-like control over mundane issues, such as a request to have the lobby swept more often, and it also creates an opportunity to come up with arrangements where instead of paying a gardener, residents choose to look after the communal garden and get a reduction on their rent.

The model also puts the onus on the developer to deliver high quality apartments, as residents can hand back the keys if they’re not satisfied.

It’s a bit like build to rent but not quite

Daff says the model shares some features of build to rent, including onsite building management staff employed to sign for packages and hold spare keys.

The difference is that the building is a wholly owned rental building for five years, and residences are then sold off individually after that time.

The response has been huge

People have moved into the developer’s first attempt at the model in Clifton Hill in Melbourne. A second 73-home development in the up-and-coming Kensington in Melbourne’s inner west is now being built, and now another site for a 210-home development has been secured around the corner.

Daff says the response to the model has been huge. Around 6000 people have signed-up to the database for the first Kensington project of 71 homes.

He says interest is coming from younger first-time home buyers, but the company is also fielding a lot of enquiries from older singles who are attracted to the idea of community.

There was some scepticism at first but with supporters such as ANZ and the state government, most people didn’t need that much convincing. The transparency around setting rent at the start also helps to quell doubts.

Getting social sustainability right in apartment blocks

Daff says environmental sustainability is now “almost a given” but what he believes is equally important is building sustainable communities. It’s not that easy, Daff explains, because designing for socially sustainable developments is still an emerging field.

“There’s a well-established industry to be sustainable on energy use and materials, but the way in which you design buildings to foster relationships for residents is less defined.”

Part of the challenge is encouraging organic connections. “We’re not going to run mandatory wine and cheese nights.”

It’s all about well design communal spaces. For example, there are always workshops on the ground floor with clear glass so that people walking by might see a neighbour struggling to fix their bike and can offer to help.

Spaces to work from home, communal gardens, children playgrounds and outdoor washing lines are the sorts of spaces prioritised by the developer.

Assemble’s 393 Macaulay Road development.

Many Australians still balk at the idea of living in an apartment because they forgo a real garden and a place to do messy jobs like painting a chair or fixing a bike.

Daff is all about overcoming the shortcomings of apartment living, such as the lack of space. That’s why the developments have lending libraries where people can borrow cordless drills and other tools that they don’t use every day.

He says all developments tread lightly on the planet with onsite solar, durable materials, flexible spaces, good access to natural light and a focus on cross flow ventilation to minimise reliance on mechanical heating and cooling.

There’s also Netherlands style bike ramps for people to park bikes and personal health and wellbeing spaces that can be booked for yoga and other activities.

Join the Conversation


Your email address will not be published.

  1. At last the idea has come full circle from the model started by public housing authorities. Just need to make sure they are designed to suit the lifespan so people can live there as long as they want regardless of age or level of capability into the future.

  2. A very interesting piece about what looks like a promising model for relatively well off people. But do we need anymore takes from upper middle class design professionals that reinforce the false stereotypes of our housing market? Including but not limited to the idea that existing apartment developments are somehow all horrible places. Millions of normal people in Australia live in apartments and have done for decades.

    “Daff says people are starting to feel a bit “ripped off” because they feel like the housing market is not designed for them and that they are stuck as a renter paying off someone else’s mortgage on their investment property.”

    Starting to feel a bit ripped off? This is utterly divorced from the reality of our capital city housing markets, which have been designed to keep poor workers paying punishingly high rents to serve the interests of landowners.

    We don’t need innovative models toward a mythical 100% ownership rate. We need enormous, sustained investment in social housing to redress 30 years of building nothing, and we need to change tenancy laws so people have some semblance of security in their home.

  3. Fantastic model Assemble. As you mention a game changer – and logical and simple, where people are treated well, with respect. Also good design leads yield. Brilliant work.