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New Low and Mid Rise Housing Policies & is your property in the indicative zone
- T.K.
- Oct 8
- 4 min read
The legislation for low and mid-rise housing policy has now taken effect, igniting lively discussions about its possible effects on neighbourhoods across the region. Will this policy create affordable housing or was it just a pen stroke solution that looked good at the time.
As a brief breakdown the: the NSE Government updated reforms to make it easier to build affordable housing, and these reforms also incorporate sustainable urban growth principles. The updated policies, such as those in the Housing SEPP, offer incentives like bonus floor space and height for projects including affordable housing, aligning with the state's broader goal of increasing housing supply and diversity in well-located, sustainable areas.
Let’s break it down.
The Developer's Dilemma
When homeowners sell their properties to developers, they often expect a premium price. Selling to a developer can mean a substantial profit, as their land will be transformed into larger and potentially higher-value properties. For instance, a plot that might fetch $1,500,000 on the open market could see developers offering 50% or much much more on top and even more if you are in a prime location, inflating expectations during negotiations.
( off course it will depend on your land size and your location)
Furthermore, capital gains tax significantly impacts sellers. In Australia, for example, the capital gains tax can be extremely as high, even if the property is sold after 12 months of ownership. This financial burden pushes sellers to ask even more for their properties to maintain their future financial plans.
This scenario complicates affordability initiatives as the prices continue to rise.
Zoning Adjustments in Prime Locations
Zoning changes have mainly occurred in high-value areas, like urban town centers, where property prices are already steep. Suburbs where median house prices can reach $1 million or more do not provide a solid foundation for affordable housing.
Conversely, regional areas, which might offer median prices around $400,000, frequently get ignored. For example, while major cities like Sydney and Melbourne struggle with housing prices, places like Geelong or the Central Coast could support more affordable developments. This gap raises questions about the effectiveness of the new policies for those who need affordable living options the most.
The Developer's Costs
After acquiring land, developers face significant costs before any homes can be sold. Costs can include:
Holding costs: Property taxes and insurance during development can amount to thousands of dollars.
Construction expenses: Building materials and labor continue to rise, putting pressure on budgets.
Recent statistics indicate that construction costs in Australia increased by about 4.3% in 2022 alone. These costs may be transferred to buyers, making it unclear whether the resulting homes will be truly affordable or just higher-priced alternatives.
Community Changes and Infrastructure Strain
As low and mid-rise buildings transform neighbourhoods, local character can shift dramatically. Communities with unique features might be overshadowed by a surge of new residents, raising concerns about existing infrastructure.
For example, public transport systems may become overcrowded. If a town sees an increase of 20% in its population, can the local transit services keep up? Schools with waitlists and limited resources might struggle to accommodate new students, potentially affecting the quality of education.
These questions are vital to address as housing policies evolve.
Hornsby Council
The Australian Advantage: Space and Nature
Australia boasts considerable space, which sets it apart from many densely populated areas globally. While many countries are limited on space versus their population and have traditionally had unit or apartment living. The beauty of Australia is that we don't have to fit into boxes because we have plenty of space!
Australia offers the promise of a less cramped lifestyle, allowing people to enjoy gardens and public spaces without overcrowding.
Enhancing community engagement and promoting healthy lifestyles
Statistics highlight that about 80% of Australians live in urban areas, but many still value access to nature. A recent survey showed that 70% of Australians consider gardens essential for their quality of life, family & over all wellbeing. This strong connection to openness and green spaces is what attracts many to live in Australia and creates strong communities instead of isolation and disharmony, which is common in apartment living.
The Reality of Affordable Housing
What does all this mean for the future of affordable housing in your community? While the new low and mid-rise housing policies may appear encouraging, there is a risk of execution falling short of expectations.
With developers aiming for maximum profits and homeowners wanting to cash in, it is possible that increased costs will simply be passed to buyers, leaving affordable living more of a goal than a reality.
Final Thoughts on Planning and Impact
Navigating these new housing policies requires careful consideration. The intention of low and mid-rise housing is clear—creating more living options. However, it is essential to ensure that these developments do not sacrifice community character, overwhelm infrastructure, or compromise affordability.
The discussion surrounding housing in Australia will continue to be crucial. It’s important for policymakers, developers, and residents to collaborate on solutions that truly benefit everyone.
As we look ahead, let’s aim for changes that foster a truly inclusive and affordable living environment for all Australians.
Considering rejuvenating regional areas and utilising the space that the country offers overall, should be paramount for the government & be a strong consideration in planning for the future of Australia.
To find out if your property is in the indicative area and what that means check out the below links.
