Apartment or House? The First-Home Buyer Question More Australians Are Asking in 2026

For generations, the answer seemed obvious. If you had the choice, you bought a house. A backyard, extra space and a standalone title were often seen as the ultimate property goal. But in 2026, first-home buyers are approaching the decision very differently.

The question is no longer simply "Which property type is better?"

Instead, many buyers are asking: "Which option makes the most sense for me right now?"

As affordability considerations, lifestyle preferences and housing needs continue to evolve, both apartments and houses are playing an important role in helping Australians take their first step into the property market. The key is understanding which option aligns with your goals.

The Debate Has Changed

For years, the apartment-versus-house discussion focused heavily on what buyers might be sacrificing. Apartments were often viewed as a compromise. Houses were often considered the ultimate goal. Today's first-home buyers are taking a more practical approach.

According to Xin Janet Ge from the University of Technology Sydney, making the choice will depend on the life stage, lifestyle and budgets which are shifting as societal trends change. Families often prefer houses for space, while younger buyers may prefer apartments for convenience, low maintenance and affordability.

A major factor influencing first-home buyers when deciding whether to buy a house or an apartment is the shift in demographic and lifestyle trends in society. According to Australian Bureau of Statistics 2021 Census data, it was identified that couples without children is rising while couples with children are declining as seen in. Furthermore, there are rising numbers of people who live alone, making compact spaces more practical.

Another factor influencing the decision of unit or house is ‘trading space for place’, as households with dual income prefer living closer to the city centre to shorten commutes.

Rather than focusing on what they might be giving up, they're focusing on what a property can help them achieve. For some, that's entering the market sooner. For others, it's securing more space, establishing roots in a community or building long-term financial security.

The "best" property isn't always the biggest one. It's often the one that supports your next move.

When an Apartment Makes Sense, and When a House Does Too

For many first-home buyers, apartments can provide an accessible entry point into sought-after locations and established communities. When comparing median house and unit prices across Australia’s capital cities (Table 1), units generally offer a more affordable entry point into the property market for first-home buyers, including single, couples, and dual-income households with or without children.

Table 1 Source Cotality, 1st August 2026

Increased access to public transport, lifestyle amenities, cafes, entertainment precincts and employment hubs continues to make apartment living attractive for a growing number of Australians.

Apartments often appeal to buyers seeking:

• Lower-maintenance living
• Convenient locations
• Lifestyle-focused communities
• A shorter commute
• An opportunity to enter the market sooner

On the other hand, houses continue to hold strong appeal for buyers who prioritise space, privacy and flexibility.

More internal living areas, private outdoor spaces and room to adapt to changing circumstances can make houses an attractive long-term option for growing families or those planning to stay put for years to come.

Many first-home buyers are also drawn to the sense of independence and freedom that detached homes can provide. Ultimately, neither option is inherently better. The right choice depends on your lifestyle, budget and future goals.

The Better Question to Ask

The apartment-versus-house debate can sometimes distract buyers from what really matters.

Instead of asking "Which property type should I buy?", consider asking:

• What can I comfortably afford?
• How do I want to live day to day?
• What location best supports my lifestyle?
• How long do I see myself staying in the property?
• What are my longer-term property goals?

The answers to these questions often reveal far more than a simple comparison between property types.

A first home doesn't need to be perfect. It needs to support the life you want to build and put you in a position to take the next step when the time is right.

There Is No One-Size-Fits-All Answer

The reality is that today's first-home buyers are taking many different paths into the market.

Some begin with an apartment close to work and lifestyle amenities. Others prioritise space and purchase a house further from major centres. Some continue renting while carefully planning their next move.

First home buyers aren’t just making a trade-off on location but are also switching their preference on property type. From a survey conducted by Westpac their findings suggested that the proportion of first-home buyers intending to buy a house declined from 64% in 2021 to 53% in 2026. Contrarily, apartments, units and townhouses jumped from 24% to 47% in the same period.

This strengthens the point of a shifting first-home buyer preference from traditional standalone suburban houses to a higher-density option like apartments.

The Growing Impact of Affordability

Also apparent is the number of renters in the younger generations as first home buyers are getting older as there is more capital required for an initial deposit. In comparison to Baby Boomers Millennials have seen an increase of 12.9% for renters in the age bracket of 25-39. Westpac data reveals the average age of a first home buyer today is 34-years-old across the bank's network, with one in five first home buyer loans issued last year going to those aged over 40.

The findings suggest many buyers are prioritising getting into the market over waiting for the perfect suburb or property.

What's becoming increasingly clear is that successful buyers aren't necessarily chasing the same outcome. They're making decisions that suit their individual circumstances. And that's a positive shift.

The apartment-versus-house debate isn't likely to disappear anytime soon. But for first-home buyers in 2026, the decision is becoming less about choosing the "better" property type and more about choosing the right fit.

Whether that's an apartment in a vibrant urban precinct or a house with room to grow, the best first home is the one that aligns with your lifestyle, budget and future plans.

Frequently Asked Questions

Does location matter more than property type?

Not necessarily, but location can have a significant impact on your lifestyle, convenience and long-term satisfaction. Access to transport, schools, employment opportunities, parks and local amenities should all form part of the decision-making process.

How can I tell if a property is the right fit?

A good property should support both your current lifestyle and your future plans. Consider factors such as space, location, ongoing costs and how well the property aligns with your goals over the next few years.

What if my first property isn't my forever home?

That's becoming increasingly common. Many Australians now view their first property as a stepping stone rather than a final destination. The focus is often on making a smart first move that creates opportunities for future growth and flexibility.

Should I seek professional advice before buying?

Absolutely. Local property experts, mortgage brokers and conveyancers can provide valuable insights throughout the buying process, helping you better understand the market, navigate potential challenges and make informed decisions.

Every Property Journey Starts Somewhere

The right first home looks different for everyone. Whether you're considering an apartment, a house or simply exploring your options, the PRD team can help you make sense of the market and make informed decisions with confidence. Get in touch with your local PRD experts today.