Welcome to the James Hardie Modern Homes Forecast 2025, our second annual report created to inspire homeowners and trade professionals with the latest home design trends.

James Hardie commissioned a comprehensive study on the evolving future of modern home design in Australia. Led by research experts Fiftyfive5, the study integrates desktop research, advanced AI technology and insights from trade professionals.

The James Hardie Modern Homes Forecast 2025 highlights four influential lifestyle themes shaping home design and explores how these themes are reflected in the popular, enduring and emerging modern home styles.

The 2024 Forecast identified seven home styles designed to suit our modern lives: Box Modern, Modern Farmhouse, Modern Heritage, Japandi, Barn, Modern Coastal and Mid-Century Modern. The 2025 Forecast details the evolution of each of those styles and unveils new eighth style – Modern Classical. This new look is gaining traction with Australian homeowners and trade professionals due to its ability to blend timeless architectural elements with modern functionality.

Whether you or your clients are dreaming of an extension, planning a renovation, or embarking on a new build, this forecast will guide and support you every step of the way. It’s time to build your modern life.

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Intro Product-Detail

Stria™  Cladding Smooth painted in a bold rust colour provides the inspiration for an earthy palette used in the iconic Barn style home, designed by Julian Brenchley.

In 2025, we are placing a deeper focus on building efficiently, with the goal of creating resilient and flexible homes that adapt to the changing needs of homeowners. This forecast aims to inspire homeowners to bring their visions to life and empower trade professionals to confidently build modern dream homes.

This year, the forecast offers two ways to browse our findings. So whether you want to be ahead of the game in key lifestyle themes, or find inspiration for your own dream home style, look no further.

Drivers of change

Global and local factors are playing a significant role in shaping how housing design is evolving across Australia. There are significant global forces influencing the Societal, Technological, Environmental, Economic and Political (STEEP) drivers of change on a local scale.

Global

Our 2025 research reveals a broad range of global shifts shaping our world. From the rapid rise of Generative AI, to increasing climate risks, and the global epidemic of loneliness, these forces are reshaping how people want to live. According to Accenture’s Global Disruption Index, disruption has surged by 183 percent from 2019 to 2023, with a 33 percent increase in the past year alone.

This ongoing turbulence highlights the importance of safety, security and the protection of our homes and livelihoods. There is a renewed awareness of the stability we once took for granted—clean air, fresh water, a secure home and meaningful connections. Homes are being designed with this in mind, offering a sense of stability and comfort in an ever-changing world.

Local

Societal

With one-third of Australians feeling lonely often or most of the time, our homes are evolving into spaces that foster social connection and counteract isolation.

Thoughtfully designed environments can encourage meaningful interactions and help people feel more connected. As anxiety and burnout become increasingly common, connection and joy are no longer seen as luxuries—they're essential to a good quality of life. The home is now seen as a place that has the potential to restore our wellbeing. More than ever, our homes are our sanctuaries, designed to nurture us in every way.

The research shows an increased focus on wellbeing at home. This can include advanced filtration systems, connection to outdoor spaces, improving thermal performance and integrating sustainability measures, all of which help to enhance our comfort and wellbeing.

Technological

Technology is transforming the way we design and experience our homes, with AI leading the charge at incredible speed.

Today, 70 percent of architects are incorporating AI into their practices, creating a revolution in how we imagine and personalise our dream spaces. Homeowners now have access to tools that bring their visions to life—exploring 3D designs in real-time and customising every detail with greater ease.

AI isn’t just about personalisation; it’s unlocking creative solutions for architects and designers, combining materials in new ways to tackle challenges in climate, cost and design. These breakthroughs are making design more accessible, empowering more Australians to bring their dream homes to life.

These advances are also helping us reimagine how our homes function. By the end of 2023, 7.6 million Australian homes were equipped with at least one smart device, paving the way for smarter, more energy-efficient and secure living. Technology is empowering us to create homes that are precise, creative and sustainable—ready to meet the needs of tomorrow.

Economic

Cost of living pressures and a growing housing crisis are reshaping how Australians live. 

For many, the dream of home ownership feels further out of reach, while the 'bank of mum and dad' has become a lifeline for others looking to secure their own home.

Australians are deeply concerned about rising costs—from childcare, to housing, to aged care—accelerating a shift towards shared living arrangements. Multi-generational living is now the fastest-growing household type, with one in five Australians already living this way and projections suggesting it will rise to one in three by 2041. This shift is creating both challenges and exciting opportunities for how we design homes to meet changing needs.

Granny flats and prefabricated housing solutions are emerging as practical, affordable ways to support multi-generational living. Features like outdoor rooms, private spaces, soundproofing and accessibility modifications are increasingly essential to create harmony in shared living spaces.

Environmental

The impacts of climate change are becoming more difficult to ignore, driving change across legislation, the construction industry and consumer preferences.

Australian homes, however, remain underprepared for what lies ahead, with rising temperatures and extreme weather events projected to intensify faster here than in most other parts of the world. More heat, more rain, and more energy usage will drive a need to create more 'resilient ready' homes that can withstand environmental forces and comply with star energy rating requirements.

Energy efficient design is more front of mind as the impacts of climate change become more evident. Research shows that 87 percent of buyers are prepared to pay more for green features like solar panels, battery storage, and efficient insulation.

In addition, Indigenous architects and professionals are leading the way in designing homes that respect and acknowledge Country. By incorporating sustain-able and ecologically aligned principles, they are shaping homes that connect more deeply with their surroundings, demonstrating how tradition and innovation can come together to create truly future-ready designs.

Political

Australia’s housing policies are embracing liveability, with a focus on delivering thoughtfully designed homes at a faster pace to meet the growing demand.

High-density living and prefabricated homes are emerging as innovative, affordable solutions to create stable and sustainable housing options for communities across the country.

In August 2023, Prime Minister Anthony Albanese announced an ambitious plan to build 1.2 million new homes over five years, beginning in July 2024.This landmark initiative, agreed upon by the National Cabinet, aims to tackle the nation’s housing crisis by increasing supply and improving affordability. To support this effort, the Federal Government has committed $3 billion in incentive payments to states and territories that exceed their housing targets, accelerating construction and driving essential reforms to boost housing availability.

Australia is leading a new wave of productivity and innovation with the multi-billion-dollar Future Made in Australia Act. This initiative is advancing the transition to a net-zero economy by supporting natural reconstruction, upskilling the workforce, and investing in domestic manufacturing of batteries, solar panels, hydrogen technologies and green metals. Together, these efforts are paving the way for a more sustainable and secure future.

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Lifestyle themes

Global and local changes are reshaping how people live, and our homes are evolving to reflect these shifts. The research has uncovered four influential lifestyle themes that are shaping the way homes are designed and built.

  1. 01 Building Efficiencies

    The race to rethink how homes are built

    While indications show the cost of materials are stabilising, the housing and skills shortage in Australia will keep demand consistently high for the coming years. Despite this demand, an average of 247 building and construction companies became insolvent every month in Australia in the 2023-2024 financial year.

    Costs for building a new home increased by 2.6 percent in 2024, marking the smallest annual rise in the national Cordell Construction Cost Index (CCCI) since March 2002, yet construction costs remain 27.6 percent higher than at the start of 2020.

    Interest rates, rental prices, and building costs continue to escalate, driving a need for homes that deliver more for less. As budgets tighten, rethinking how we build becomes essential. Homes that fit every budget aren’t just a preference—they’re a necessity for today’s homeowners.

    Building efficiency is at the heart of this shift, with a growing demand for smaller yet smarter designs. Space-saving layouts, multi-storey solutions and modular or prefabricated housing are gaining popularity for their ability to address both affordability and faster build times. Architects, designers, builders and homeowners are embracing these innovative approaches, paving the way for homes that are as practical as they are beautiful.

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    Building-Efficiencies

    This two storey Mid-Century Modern home makes the most of vertical space with a cantilever deck and living area over the yard, designed by Happy Haus and clad using Linea™ Weatherboard Cladding.

    Prefab the new fab

    Prefabrication promises to reduce the time, cost and environmental impact of new builds. Design features of prefabricated homes include floor cassettes, wall panels, a facade system with Hardie™ products, and roof cassettes that all work together as an integrated structural system acting as a diaphragm. In contrast to traditional masonry construction, all these elements work together to carry the structural load, as well as create the envelope. This dual function allows the home to be lighter, more efficient and cost effective. Some prefab homes can be manufactured and delivered to site in just 12 weeks (James Hardie Builder Insights interview with MIRA Residential, 2025).

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    Repair and recycle

    Recycled materials are reducing build costs and carbon footprints. As the construction industry examines its circular impact, experts are mining 'anthropogenic' materials—waste from buildings and human sources—for reuse. Architects increasingly view waste as a design flaw, focusing on recycling and rebuilding with existing materials wherever possible.

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    Space-saving design solutions

    Owning a smaller block doesn’t mean compromising on style or functionality. Built-in storage maximises every corner, while compact layouts ensure efficient use of space. Multi-functional rooms—like a guest bedroom doubling as a home office—add versatility. Clever features such as fold-away desks, wall beds and retractable partitions create flexibility without clutter. With smart design, even the smallest home can feel spacious, practical and beautifully tailored to modern living.

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    Multi-storey living

    Space efficiency means more than optimising floor space. Maximise vertical space, especially when it is not possible to build separate wings, to create flexible, efficient homes that cater to individual and future residents’ needs. Building up, not out, is a smart way to utilise the existing land and stay within budget. Multi-storey homes can be designed with thoughtful features like stacked plumbing to reduce construction costs and clever layouts to save on materials. Use vertical space for storage or mezzanines and opt for cost-effective materials like Hardie™ cladding products for a durable yet beautiful facade. By focusing on flexibility and efficiency, you can create a stunning, functional home for years to come.

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  2. 02 Wellbeing

    Homes that support our wellbeing

    Our wellness routines have become a necessity, and the home is now a vital space for improving and protecting our mental, physical and social wellbeing. Australians are increasingly prioritising wellbeing within their homes, reflected in property search trends. Domain, one of Australia’s leading real estate platforms, has identified top keyword searches such as ‘pool,’ ‘view’ and ‘waterfront,’ highlighting the growing demand for features that enhance lifestyle and connection to nature.

    Australians are investing more in all aspects of wellness. According to the Global Wellness Institute's 2024 report, Australia ranks as the 11th largest wellness market globally, with a market size of $110 billion. Additionally, Australia holds the 7th position in wellness spending per capita, averaging $4,218 per person annually.

    Global events like the pandemic, coupled with environmental challenges like bushfires, floods and extreme weather, have intensified feelings of anxiety and burnout. These disruptions to daily life have led to a renewed focus on creating indoor spaces that provide comfort, reduce stress, and support emotional resilience. To find more space and a better way of life, many city dwellers are on the move, with regional migration hitting a 12-month high, now sitting 20 percent above the pre-COVID average.

    Today’s homes are designed to be true havens—where we can slow down, recharge, and connect meaningfully. From improving thermal performance, reducing noise and fostering a connection with nature, wellbeing is truly at the forefront of design. Features like biophilic elements, which bring the outside in through natural light, as well as ventilation, organic shapes and natural-look materials, help create a sense of calm and vitality.

    As smart home technologies and WELL-certified buildings become more popular, homes now actively support healthier lifestyles. Innovations in air and noise pollution reduction, along with designs that prioritise productivity and creativity, ensure that modern homes are not just where we live—they’re where we thrive.

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    Wellbeing

    Louvered windows address the need for both natural light and ventilation, as seen in the Ferndale Home designed by Webster Architecture.

    Connection to nature

    Connecting to nature doesn’t necessarily require a backyard—it’s about bringing nature indoors through natural materials, greenery and integration with the surroundings. Architects enhance this connection with elements like water features, plants, internal light wells and systems making the most of sunlight, fresh air and rainwater. Bright flowers, soothing scents, sensory landscaping and curved, nature-inspired materials create visually pleasing, harmonious spaces that nurture wellbeing and bring the outdoors inside.

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    Natural Light and ventilation

    Daylight enhances energy efficiency in our homes, as well as our mood and sleep by regulating circadian rhythms. This is achieved through skylights, clerestory windows and light wells. Innovative designs soften Southern Hemisphere sunlight into warming energy. Advanced insulation, indoor gardens and smart ventilation systems maintain fresh air, purify spaces and adjust to occupancy, ensuring our air quality and comfort year-round. Together, these elements create healthier and more energy-efficient homes.

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    Acoustics

    While blocking external noise is key in residential design, internal acoustics are equally crucial. Thoughtful acoustic design transforms homes into calm, harmonious spaces suited to individual work, rest and play. Acoustic engineering can tailor soundscapes to specific spaces, balancing the buzz of family life with private, quiet areas.

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    Curves and colour

    Curves and colour play vital roles in stimulating the senses and creating wellbeing. Curves, historically used to evoke grandeur, are preferred by the brain and can be used to enhance geometry in exteriors and functionality in interiors. Colour influences mood—bold palettes boost creativity and focus, while natural tones promote tranquility. Trends are shifting from neutral shades to vibrant, vivid colours, transforming homes inside and out into energising, harmonious spaces.

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  3. 03 Flexibility

    Flexible homes to serve more people and purposes

    Flexibility and adaptability in the home have never been more important as households evolve to meet new demands. In Australia, economic pressures are driving a resurgence in multi-generational living. Housing shortages, rising rental costs and an ageing population are bringing family members—young and old—together under one roof.

    While the average block size has shrunk by an average of 10 percent over the last decade, the homes being built on them remain the same size, as we look to squeeze in as much ‘house’ as possible. Councils and governments are making it easier to build granny flats and outdoor studios.

    This shift is challenging us to rethink our living spaces to make them work harder and smarter. Modern homes are now designed to serve multiple people and purposes, evolving with changing needs and living norms. From multi-generational living situations to hybrid workspaces, granny flats, outdoor studios, play areas and interconnected yet separate living zones, flexible designs ensure homes can adapt to whatever life brings.

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    Flexibility

    This Japandi home uses sliding doors to expand the living area out into the garden for indoor-outdoor connection.

    Granny pods

    With reviewed permit laws in many states, relocatable, efficient, and cozy pods are increasingly popular. These versatile structures, perfect for home offices, teenage retreats or self-sufficient tiny homes, combine functionality with aesthetics. Built to various sizes and purposes and in record time, with many completed in just 10–12 weeks, pods are a quick and appealing solution for contemporary multi-generational living. 

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    Changing rooms

    Sliding doors offer versatile solutions, concealing spaces or expanding and shrinking areas as needed. Soundproof options create quiet zones, while others bring the outdoors in. Inspired by Japanese architecture, they divide or open the kitchen, living and dining areas seamlessly. New modular designs eliminate walls entirely, enabling truly flexible spaces where furniture transforms and items like televisions or kitchens remain hidden, redefining how we live and adapt our homes.

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    Accessible spaces

    Townhouses and multi-story homes now feature separate entrances, self-contained kitchens and living spaces to accommodate Airbnb guests, adult children or elderly residents. Accessibility modifications rose by 20 percent for older family members in 2024 and updated construction codes across Australia mandate wider hallways and step-free entries, enhancing accessibility for all. These thoughtful designs balance functionality and inclusivity, making homes more adaptable to evolving family needs and modern lifestyles, while providing comfort and independence for diverse occupants.

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    Internal courtyards

    Internal courtyards provide privacy and seamlessly break up living areas, creating tranquil, functional spaces. Acting as connectors between rooms, they are ideal for fostering interaction while maintaining separation—perfect for people cohabiting at different life stages. With versatile designs, courtyards enhance natural light, airflow and greenery, blending practicality with aesthetics to create inviting and harmonious homes suited to miscellaneous family needs.

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  4. 04 Resilience

    Resilient homes are the new must-have

    Resilient homes are becoming less of a luxury and more of a necessity. With increasing pressure from insurance companies, evolving building codes and the growing visibility of extreme weather events, homes need to do more than just shelter us. Climate change is bringing more rain, more heat, higher energy usage and rising bills. Currently, 1.6 million Australian homes are at moderate or high risk from climate impacts—a number projected to climb to 2.6 million by 2050, with one in 25 homes becoming uninsurable by 2030.

    It’s no surprise that resilient and passive features are at the top of homebuyers’ wish lists, with the number of passive homes and apartments in Australia doubling. 

    Modern homes are being designed to be 'resilient ready,' adapting to environmental changes and technological advancements. From meeting 7-star energy requirements, to embracing all-electric designs with no gas, these homes are built to withstand environmental forces and enhance efficiency.

    'Country Centred design' is also emerging as Indigenous architects and professionals look to contribute to building design to make it more sustainable and ecologically true to its location.

    By incorporating innovative materials, efficient supply chains and value-adding features like high-performance insulation and passive cooling, today’s homes aren’t just more sustainable—they’re ecologically aligned with their surroundings, designed to endure and thrive in a changing world.

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    Resilience

    Passive passion

    Originating in Germany, Passivhaus (Passive House) principles have evolved and are now widely adopted in Australia for residential and commercial buildings. These principles include super-insulated envelopes, airtight construction, high-performance window glazing and heat recovery ventilation. The benefits are significant—no drafts, consistent comfortable temperatures, improved energy efficiency, cleaner air and superior soundproofing—creating healthier, more sustainable and comfortable living and working environments.

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    Resilient ratings and materiality

    With climate disasters on the rise, resilience is becoming more of a priority for homeowners. Hardie™ fibre cement offers a durable solution, engineered to withstand Australia’s harsh environment—fire and rot resistant, and resistant to moisture damage and termite damage. The Resilient Building Council of Australia’s National Bushfire Resilience Rating system helps homeowners improve safety while earning insurance discounts. In high-risk zones, bushfire protection measures are becoming mandatory, driving demand for robust building materials like Hardie™ products.

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    Water savers and rain makers

    Today’s architects face the challenge of managing water—allowing its flow through structures or preventing it entirely. Building above flood zones is one solution, but material selection is crucial when water and humidity take hold. Innovative modular homes are also emerging, designed to float as waters rise, offering a forward-thinking response to the increasing threat of floods, ensuring resilience and adaptability in changing climates.

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    Cool changes

    With increasing temperatures year-on-year, home designers are under pressure to find innovative ways to cool down such as e-coating and paint that reflects heat. Screens that open and close serve the dual purposes of allowing both ventilation and protection from the sun. Additionally, low lying buildings benefit from more stable thermal conditions. The ground temperature remains relatively constant, allowing these buildings to maintain cooler internal temperatures compared to taller structures, which are more susceptible to fluctuating.

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Modern home styles

Be inspired by these 8 popular, enduring and emerging modern home styles reimagined for 2025. Each home has been designed by an industry expert, including the newly emerged Modern Classical home style.

01 Box Modern Detail01 Box Modern Hero

01
Box Modern

02-Modern-Farmhouse02-Modern-Farmhouse Detail

02
Modern
Farmhouse

03 Modern Heritage Hero03 Modern Heritage Detail 4.5

03
Modern
Heritage

05 Barn Facade05 Barn Detail 4.5

04
Barn

04 Japandi Hero04 Japandi Rear

05
Japandi

06 Modern Coastal Hero06 Modern Coastal Detail

06
Modern
Coastal

07 Mid-Century Modern Thumbnail07 Mid-Century Modern Detail 4.5

07
Mid-Century
Modern

08 Modern Classical Thumbnail De08 Modern Classical Thumbnail Ro

08
Modern
Classical